Ask a solicitor: My company is making redundancies
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Dear Reader,
Redundancy is governed by the Redundancy Payment Act 1960. Section and Section 8 of the Act sets out the right to redundancy.
Under Section 7(2), it states that an employee who is dismissed is to be taken to be dismissed by a reason of redundancy if the dismissal attributable wholly or mainly to:
- The fact that the employer has ceased or intends to cease to carry on the business for the purpose for which the employee was employed by him or has ceased or intends to cease to carry on the business in the place where the employee was so employed, or
- The fact that the requirements for that business for employees to carry out work of a particular kind or for employees to carry out a particular kind in that place where he or she was so employed have ceased or diminished or are expected to cease or diminish.
Redundancy typically occurs when an employee’s position ceases to exist and the employees is not replaced. Any employee who is over 16 years of age and has 104 weeks continuous service with an employer is entitled to a statutory redundancy payment. Typically, an employee receives a “Notice of a Proposed Dismissal for a Redundancy (form RP50) Part”.
The employee may decide to leave the employment earlier than the date of redundancy notified to them to take up an offer of alternatively employment. However, if they do decide to leave, there is a risk that they may lose entitlements to redundancy payments unless they notify their employer in writing and it is at the employer’s discretion as to whether they will grant such a request.
If your employer still refuses to pay it, and there is a dispute about the redundancy, you can bring a claim to the Workplace Relations Commission using the Workplace Relations Online E-Complaint Form. If you are applying to the Department of Social Welfare, you have to have an application form signed by your employer or a WRC decision confirming redundancy.
However, it should be noted that employers may enter into Redundancy Agreements, which are also known as Severance Agreements, where they may offer more than the Statutory Payment. Typically, with these agreements, an employer may offer an Ex-Gratia payment and they may also offer payment in lieu of notice.
The nature of these agreements tends to be that by signing these agreements, and accepting the payments that you would waive any potential claims that you would have against your employer under any employment legislation.
Typically, in these agreements, they may also make provision that you have to return company property and that the nature of the agreement is confidential and should not be disclosed to third parties. There may be restraint of trade type clauses in the agreement, depending on the nature of the agreement, and typically, there will be prohibition from you approaching clients of your employer.
Typically, there may be a period, which is known as Gardening Leave, where you will not be working, but the termination date of the contract may be a number of weeks or months after the agreement is signed. During this period, you are technically still working for your employer, although typically, you would not be working and you would be paid during this period.
If you are entering into a Severance Agreement, I would suggest that you try and obtain legal advice from a solicitor and often the employer is willing to make a contribution towards your legal costs in this respect.
Email: info@walshandpartners.ie
- Disclaimer: While every care is taken to ensure the accuracy of the information contained in this article, solicitor Stephen Coppinger does not accept responsibility for errors or omissions howsoever arising, and you should seek legal advice in relation to your particular circumstances at the earliest possible time.
