Dáil Éireann Debate, Tuesday - 6 October 2020
494. Deputy Steven Matthews asked the Minister for Social Protection if provisions are being considered with regard to sole traders and the provision of redundancy to staff if they are to face closure due to the Covid-19 pandemic (details supplied). [28883/20]
View answerThe Redundancy Payments Act 1967, as amended, provides for the making of payments by employers to employees in respect of redundancy. It is the employer’s responsibility to pay statutory redundancy payments to all eligible employees. In the event that an employer is unable to pay due to financial difficulties, an application for payment from the Social Insurance Fund may be submitted to the Department.
When such a redundancy payment is made from the Social Insurance Fund, a debt is raised against the employer. The Department is obliged to make every effort to recover the debt owed, in accordance with Section 32 of the Act. The Department will engage with employers to establish their financial situation and seeks to recover the debt on a mutually agreed basis, including repayments by instalment, where appropriate.
In the case of sole traders, they do not have the protection of limited liability. In such instances the full liability remains with them or their estate. Since the start of the pandemic the Department has been very mindful of the difficulties that sole traders are facing. For a time, debt reminder letters did not issue. In some circumstances debt repayments were suspended until the business is in a better financial position. If a closure situation arises, the existing mechanisms are flexible enough to make statutory redundancy payments on behalf of employers and to adjust the repayment arrangements, thus easing the pressures on sole traders.
The Department’s policy is kept under review but any change to the policy must ensure that employer debt is recovered in full wherever possible.
