Suspension of workers’ right to redundancy could be extended

The Government is looking at extending the suspension of the rights of workers who were laid off to seek redundancy from their employer.

Under the Redundancy Payments Act 1967, employees who have been laid off for at least four weeks have the right in certain circumstances to demand that their employer make them redundant.

Covid-19 emergency legislation introduced earlier this year contained a provision which suspended the right of laid-off employees to demand redundancy. This provision was supposed to come to an end on September 17th.

The Cabinet is expected to consider the issue on Tuesday and some informed sources said consideration was being given to a further extension. However sources said at the weekend that no decision had been taken at that stage on a final recommendation.

The aim of the 1967 legislation was to ensure that workers would not be left in an indefinite “limbo” – where they were neither at work, fully unemployed or available to take up a job elsewhere.

Under the legislation if an employer cannot guarantee 13 weeks of full- time work within four weeks, then the employee automatically becomes entitled to redundancy.

At the time of the suspension of the provisions of the 1967 legislation there were fears that the Covid-19 crisis could lead to large number of workers who had been laid off by their employer invoking their rights to be deemed to be redundant.

There were fears this could have had major impacts on the cash flow of business which would have had to pay redundancy lump sums or, alternatively on the State which could have to finance statutory redundancy terms where companies could not afford to do so.

At the height of the Covid-19 crisis at the end of April/early May there were just under 600,000 people receiving the special pandemic unemployment payment.

The basic statutory redundancy entitlement is two weeks per year of service capped at €600 per week plus a week.