With talk of a tech crunch, and news of redundancies at Twitter, Stripe and Meta, many workers might have questions about their rights when told their job is at risk of redundancy. Redundancy arises where your job no longer exists due to a company closure or changes to the structure of the the company for technical or organisational reasons.
There is a duty on the employer to make fair selection of employees to be made redundant. They must utilise a transparent selection matrix, and rely on criteria such as voluntary redundancies, ‘last in, first out’, or a points based system considering things like skills, qualifications and experience.
Employers must not rely on any personal or non-job related criteria to make the selection. They must ensure the selection criteria do not directly or discriminate against any protected characteristics, for example on the grounds of age.
Employees who are on protected leave (such as maternity leave) are protected from being selected for redundancy until their return to work. Pregnancy or leave may not be a consideration in redundancy selection.
Employees are entitled to be consulted meaningfully in circumstances where their job is at risk. They should be offered alternative roles where appropriate. Redundancy should be regarded as a last option.
In a collective redundancy where a certain percentage of an organisation’s workforce is to be made redundant, the duty of consultation is increased and formalised. A 30 day consultation period must be followed, and greater transparency shown in relation to the process.
Once a worker has been informed in writing that they have been selected for redundancy, they are entitled to a notice period which is the greater of the period set out in their contract or a notice period of between one and eight weeks depending on their contract. They may or may not be required to work the notice period, but must be paid.
A worker is entitled to take any untaken annual leave during their notice period, or to be paid in lieu of annual leave. They are also entitled to take time off work to attend at job interviews or training.
A worker with in excess of 2 years continuous service is entitled to statutory redundancy pay. This tax free payment amounts to two weeks’ pay for each year of service plus and additional one week. A weeks’ pay is capped at €600 for the purpose of calculating redundancy.
An employer may offer an enhanced redundancy payment. They are not obligated to do so unless it forms part of your contract or has been a custom in the workplace. This payment is taxable but the worker may be entitled to tax relief in certain circumstances.
In the event you feel the redundancy was not genuine, that you were unfairly selected, or that you have not received your entitlements, you may bring a case to the Workplace Relations Commission.
The above is provided for information purposes and is not intended as legal advice. We, at Fitzsimons Redmond LLP, would be happy to talk to you about your redundancy situation . Please contact us on 01-676 3257.
By Lisa Quinn O’Flaherty
Partner at Fitzsimons Redmond LLP