Wednesday, 25 January 2012

Questions (24)

Pádraig Mac Lochlainn


19 Deputy Pádraig Mac Lochlainn asked the Minister for Jobs, Enterprise and Innovation if he will detail the responsibilities in place to ensure that businesses maintain enough funds to cover liabilities arising from redundancies. [4121/12]

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Written answers (Question to Minister for Jobs, Enterprise and Innovation)

Responsibility for the operation of the statutory Redundancy Payments Scheme falls within the remit of the Minister for Social Protection and the legislation governing that scheme does not fall within my Department's purview. I understand that in accordance with the Redundancy Payments Acts 1967-2007 employees who have two years continuous service with an employer, are aged 16 years or over, and are in employment, which is insurable for all benefits under the Social Welfare Acts, are entitled to statutory redundancy payment from the employer in the event of being made redundant.

Where employment has been terminated, the employees have an entitlement to redundancy, and where the employer fails to pay the employee's statutory entitlement, a claim may be referred by the employee to the Employment Appeals Tribunal (EAT). On receipt of a favourable determination by the EAT the employee should submit the determination along with a completed RP50 form to the Redundancy Payments Section of the Department of Social Protection for payment from the Social Insurance Fund.

In a case where the employer cannot afford to pay an employee their entitlement, an employer and employee can apply to the Social Insurance Fund for a Redundancy Lump sum using form RP50. Proof of inability to pay is required together with an acknowledgement of the employer's liability for 85% (from 1 January 2012) of the statutory redundancy payment. The Minister for Social Protection will make the payment from the Social Insurance Fund and subsequently seek to recover repayment of 85% of the statutory redundancy payment.

Redundancy payment entitlement is two weeks wages for each year of service with a bonus week added on subject to a maximum ceiling on gross wage. The current ceiling on the weekly wage used for calculation purposes is €600. Where a company is forced to close, monies owing to workers (including redundancy) have a preferential status in the distribution of assets.