Dáil Éireann Debate, Tuesday - 28 September 2021
206. Deputy Louise O'Reilly asked the Tánaiste and Minister for Enterprise, Trade and Employment the estimated cost of the redundancy scheme and plan which he recently announced in the media that his Department is working off. [46551/21]
Amharc ar fhreagraReckonable service is service that is included in the calculation of a redundancy lump sum payment. The existing provisions of the Redundancy Payments Act 1967 provide that a period of lay-off within the final three years of employment before redundancy is not allowable as reckonable service.
Because the necessary Government-enforced lockdowns caused layoff situations which resulted in this loss of reckonable service for some employees, the State will make a payment in respect of periods of layoffs due to Covid-19, in situations of redundancy.
The payment will apply to workers who have been, or who will be made redundant in the next 3 years, and who have lost reckonable service due to layoffs caused by Covid-19 restrictions, and who were in receipt of PUP or other jobseeker’s payment for the period up to 30th September 2021, the date Section 12A of the Redundancy Payments Act will expire.
The calculation for the period of lay-off will be based on the existing provisions of the Redundancy Payments Act 1967. In summary, an eligible employee is entitled to two week’s remuneration per year. If the lay-off period is not an exact number of years, the “excess” days are credited as a proportion of a year. The weekly remuneration is subject to a ceiling of €600 per week.
The amount an eligible worker will receive will depend on the length of time they were placed on layoff due to Covid-19, and not otherwise working, before the date they were made redundant.
It is difficult to assess how many redundancies are likely to unfold in the economy which, in turn, informs cost projections. While many sectors are expected to rebound relatively quickly once restrictions are lifted, redundancies in some businesses are still likely.
It is worth emphasising that there has been an effective ban on employees claiming redundancy since March 2020 and there has been very few insolvencies during this time. It is expected that this will inevitably change as the economy fully re-opens and Covid related financial supports for businesses are phased out.
