Note regarding rebates from 60% to 15%


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The employer rebate of statutory redundancy payments will reduce from 60% to 15%.

The change in rate will apply where the date of dismissal by reason of redundancy occurs on or after 1 January 2012.

What is the date of dismissal?

Date of dismissal as defined in the Redundancy Payments Act 1967 is as follows;

  1. "date of dismissal” in relation to an employee, means –

    1. where his contract of employment is terminated by notice given by his employer, the date on which that notice expires,
    2. where his contract of employment is terminated without notice, whether by the employer or by the employee, the date on which the termination takes effect, and
    3. where he is employed under a contract for a fixed term, and that term expires without the contract being renewed, the date on which that term expires."

Do the proposed changes affect redundancy claims already submitted?

Where the date of dismissal occurs on or before 31 December 2011 the 60% rebate rate will apply.

What happens in a situation where an employer has given an employee 4, 6 or 8 weeks’ notice in compliance with the Minimum Notice legislation?

The date of dismissal is the date the notice period expires. Depending on when the notice is due to expire this could mean that the date of dismissal will be on or after 1 January 2012. If this is the case, the 15% rebate will apply.

What happens if an employer gives pay in lieu of notice?

Pay in lieu of notice does not alter the actual date of dismissal. For redundancies with date of dismissal on or after 1 January 2012 the rebate rate of 15% will apply.

Last modified:09/12/2011
 

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