Section 12A of the Redundancy Payments Act 1967 is the emergency provision which suspends an employee’s entitlement to claim redundancy from their employer following certain periods of lay-off or short time work due to Covid-19. When this emergency provision ceases to have effect, eligible employees will be able to make a claim for redundancy from their employer. The employer can then agree to the redundancy payment if they do not have work to offer the employee, or they can give counter notice by offering the employee not less than 13 weeks unbroken employment.
Under existing provisions, in situations where an employer cannot sustain the cost of redundancy payments due to financial difficulties, the Department of Social Protection provides a safety net for both employers and employees and can make the statutory redundancy payment to eligible employees from the Social Insurance Fund on behalf of the employer. When such a redundancy payment is made, a debt is raised against the employer.
That Department will engage with employers to establish their financial situation on a case by case basis and will seek to recover the debt on a mutually agreed basis. Since the start of the pandemic, the Government has been very mindful of the difficulties that employers are facing. Where appropriate an agreed repayment plan can be put in place to minimise financial hardship on an employer. For example, the debt can be recovered by way of instalments over a period of time.
There has been ongoing dialogue with both employee and employer representative groups on the continued operation of the emergency provision, Section 12A of the Redundancy Payments Act 1967.
The Government has also put in place unprecedented levels of financial supports for businesses in response to the Covid-19 crisis which provides employers with the security of continued assistance, thereby sustaining jobs.