Understanding the Collective Redundancy Process
When a business proposes to make a large number of employees redundant within a short timeframe specific legal protections are triggered for the workforce under Irish employment law.
The most important of these protections is the mandatory consultation period. An employer cannot simply hand out notice letters. They are legally required to enter into an information and consultation process with employee representatives or a trade union. This consultation process must begin at the earliest opportunity and at least 30 days before the first notice of dismissal is issued.
During this 30 day window the employer must also formally notify the Minister for Enterprise Trade and Employment. The purpose of this period is to explore alternatives to the job losses, discuss the selection criteria used to choose who is made redundant and look at ways to mitigate the financial impact on the affected staff. Employees are fully protected during this initial 30 day period and cannot be dismissed.
Timelines Following the Consultation Period
Once the mandatory 30 day consultation period concludes, the employer can formally issue notice of redundancy. The length of your notice period depends on your length of service with the company as set out in the Minimum Notice and Terms of Employment Acts or your employment contract if it offers a longer period. You are entitled to be paid your normal wages during this notice period even if you are not required to work it which is commonly known as pay in lieu of notice.
Statutory Redundancy Payments
If you have two years of continuous service over the age of 16 you have a legal right to a statutory redundancy payment. This is calculated at two weeks of normal pay for every year you have worked for the employer plus one additional bonus week. The maximum weekly amount used for this calculation is capped by the government at 600 euros. This statutory payment is tax free and must be paid to you in a lump sum when your employment officially ends.
Partial Payments and Employer Insolvency
In some large scale redundancy situations employees hear rumours about partial payments or delayed settlements. If the employer is solvent your statutory redundancy and contractual notice pay must be paid in full on your final day.
However, if the business is entering liquidation and cannot afford the redundancy packages the state will step in. The Department of Social Protection operates a scheme that guarantees your statutory entitlement but processing these state applications introduces a different timeline and delays before you receive your money.
Protecting Your Rights During Collective Redundancy
The collective redundancy process is complex and the rules surrounding consultation periods, notice and insolvency can be difficult to interpret when your job is at risk. But making sure that your employer follows the strict legal timelines is vital to protecting your financial entitlements. the implications.
Contact MM Halley and SonsI
f you are impacted by a large scale redundancy and have concerns about the consultation process, your notice period or your final settlement our employment law team can help. We provide clear practical advice on your rights under the Protection of Employment Acts. Contact our offices today to discuss your situation.
Collective Redundancy Process Ireland FAQs
What happens if my employer does not consult with us before making redundancies?
If an employer fails to engage in the mandatory 30 day consultation process or issues notice of dismissal before this period ends they are in breach of the law. You may have the right to seek compensation through the Workplace Relations Commission for this failure.
Do I get my redundancy pay immediately if the company goes into liquidation?
No. If your employer is legally insolvent and cannot pay your statutory redundancy the liquidator must apply to the Department of Social Protection on your behalf. The State will pay your statutory redundancy from the Social Insurance Fund but this process involves administrative waiting times.
What is the maximum statutory redundancy payment I can receive?
Statutory redundancy is calculated at two weeks of normal pay per year of service plus one bonus week. However the government caps the weekly earning amount used for this calculation at 600 euros.
Can I be made redundant without notice?
In a collective redundancy situation you are entitled to your statutory or contractual notice period whichever is longer. You must be paid for this notice period even if your employer tells you that you are not required to work it.
