Redundancy Procedures


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Information

Employers are obliged to follow certain procedures when an employee becomes redundant. Redundancy occurs where you lose your job due to circumstances such as the closure of the business or a reduction in the number of staff. The Redundancy Payments Acts 1967–2012 provide a minimum entitlement to a redundancy payment for employees who have a set period of service with the employer. Not all employees are entitled to this statutory redundancy payment, even where a redundancy situation exists. You can read our document on qualifying for redundancy.

Employer rebate abolition: There will be no statutory redundancy employer rebate where the date of dismissal due to redundancy is on or after 1 January 2013 see 'Further information' below.

Rules

In addition to the provisions in the legislation as regards collective redundancies your employer must follow certain fair procedures that is, to give you at least 2 weeks' notice and on the date of dismissal pay your redundancy payment. There are also various procedures with regard to selection for redundancy, alternative work and time off.

Selection for redundancy

In selecting a particular employee for redundancy, an employer should apply selection criteria that are reasonable and are applied in a fair manner. You are entitled to bring a claim for unfair dismissal if you consider that you were unfairly selected for redundancy or consider that a genuine redundancy situation did not exist. Examples of these situations might include where the custom and practice in your workplace has been last in, first out and your selection did not follow this procedure. Another example may be where your contract of employment sets out criteria for selection which were not subsequently followed.

Under the unfair dismissals legislation, selection for redundancy based on certain specific grounds is considered unfair. These include redundancy as the result of an employee's trade union activity, pregnancy or religious or political opinions. The employment equality legislation also prohibits selection for redundancy that is based on any of the following 9 grounds: gender, civil status, family status, age, disability, religious belief, race, sexual orientation or membership of the Traveller community.

Alternative work

As with any dismissal, an employer must act reasonably when dismissing an employee in a redundancy situation. This requires prior consultation with you before the decision is made. In addition, your employer should consider all options including possible alternatives.

If your employer makes you a reasonable offer of alternative work, and you refuse it, you may lose your entitlement to a redundancy payment. Generally speaking, alternatives which involve a loss of status or worsening of the terms and conditions of your employment would not be considered reasonable. Similarly, you may be justified in refusing an offer that involves you travelling an unreasonable distance to work.

You may take up an alternative on trial for up to 4 weeks. Where the alternative involves a reduction of 50% or more in hours or pay, working under the new arrangements for up to 52 weeks will not count as an acceptance.

If you accept a new contract or re-engagement with immediate effect and the terms do not differ from those of the previous contract, you will not be entitled to claim redundancy. This also applies if you refuse such an offer unreasonably.

If you accept an offer in writing from your employer for a new and different contract which will take effect within 4 weeks of the ending of the previous contract, you will not be entitled to claim redundancy. Equally, if you refuse such an offer unreasonably, you will lose your right to a redundancy payment.

Your justifiable refusal of an offer of alternative work, followed by dismissal, may, depending on the circumstances, entitle you to seek statutory redundancy or make a claim for unfair dismissal.

Any offer of alternative work should be given to you in writing and you are entitled to full information concerning the details of the offer.

Notice from the employer

You are entitled to a minimum of 2 weeks' notice of redundancy. This notice period goes up depending on the period of service.

Period of service Notice required
Between 2-5 years 2 weeks
Between 5-10 years 4 weeks
Between 10-15 years 6 weeks
Over 15 years 8 weeks

Notice when on lay-off or short time: If you have been laid off or put on short-time work, this means that your contract of employment is temporarily suspended. If your employer then decides to make you redundant, he or she must re-activate your contract in order to dismiss you on grounds of redundancy. When your employer gives notice of redundancy you are entitled to the full notice period. If you are made redundant and you are not required to work out your notice you are entitled to payment in lieu of notice which is your normal pay for that notice period.

For example, if you have been on short-time work and your employer then makes you redundant your payment in lieu of notice is based on the hours of work in your contract of employment, not on the short-time hours of work.

Time off

If you are being made redundant, you are entitled to reasonable paid time off in order to look for a new job. This right is set down in law in Section 7 of the Redundancy Payments Act, 1979. (You should note that while the Redundancy Acts have been amended a number of times the provisions as set down in 1979 for time off, still remain in force today.)

Holidays

You are entitled to any holidays that are outstanding or payment in lieu of holiday.

Leaving before your notice expires

Between receiving your notice of redundancy and the date your employment ends, you may give your employer notice that you wish to leave before the end of your notice period. You do this by completing form RP6 (pdf) and giving it to your employer. Your employer has discretion as to whether to grant your request or not. You should note that leaving during the notice period without your employer's agreement may affect your entitlement to a redundancy payment.

Social welfare payments

When you lose your job you should register as unemployed by signing on with your local social welfare office. If you have enough social insurance contributions you may be entitled to Jobseeker’s Benefit. If you do not have enough PRSI contributions you may qualify for Jobseeker’s Allowance which is a means-tested benefit.

How to apply

Your employer must give you at least 2 weeks' notice of the redundancy. On the date of the termination of employment your employer should pay the redundancy lump sum due to you.

You can find information for employers on making a redundancy claim here. This must be done online using form RP50.

If your employer has not paid your redundancy lump sum, you should apply to your employer for it using form RP 77 (pdf). If your employer still does not pay it, you can apply to the Department of Social Protection for direct payment from the Social Insurance Fund as follows:

  • If your employer is unable to pay your redundancy lump sum, they should complete and sign the RP50. They should also submit a letter from an accountant or solicitor stating they are unable to pay and accepting liability for 100% of the lump sum (85% for a dismissal in 2012) owing to the Social Insurance Fund. Documentary evidence such as audited accounts should also be included.
  • If your employer refuses to pay your redundancy lump sum or if there is a dispute about redundancy you can bring a claim to the Employment Appeals Tribunal. You must use the online complaint form (available by selecting ‘Make a complaint in relation to employment rights’ on workplacerelations.ie). This must be done within one year of your dismissal. Then you apply for your lump sum by sending a completed form RP50 to the Redundancy Payments Section together with a favourable decision from the Employment Appeals Tribunal

Insolvency: If the company has been liquidated or is in receivership, the completed form RP50 should be sent in by the liquidator or receiver on behalf of the employees.

You can read this list of frequently asked questions about redundancy.

Where to apply

The application for payment from the Social Insurance Fund should be sent to:

Redundancy Payments Section

Department of Social Protection
Floor 2, Block C
The Earlsfort Centre
Lower Hatch Street
Dublin 2
Ireland

Locall:1890 800 699

For further information about the Redundancy Payments Scheme contact:

Workplace Relations Customer Services

Department of Jobs, Enterprise and Innovation
O'Brien Road
Carlow
Ireland

Opening Hours: Mon. to Fri. 9.30am to 5pm
Tel: (059) 917 8990
Locall: 1890 80 80 90
Homepage: http://www.workplacerelations.ie/en/

Further information

Employer rebate prior to 1 January 2013

Where the date of dismissal was before 1 January 2013, an employer who pays the statutory redundancy entitlement and gives proper notice of redundancy (at least 2 weeks) is entitled to a rebate from the Social Insurance Fund. Where the date of dismissal occurred in 2012 the employer rebate is 15%. If the date of dismissal was in 2011 or earlier the employer rebate is 60%.To make a claim for this rebate employers should submit the online form RP50 to the Redundancy Payments Section of the Department of Social Protection within 6 months of the date of termination of employment.

Last modified:12/03/2014
 

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