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Many businesses are currently experiencing a downturn in the demand for their products or services and as a result are forced to assess their workforce numbers. There are a number of short term and long term options available, all requiring compliance with employment laws and due process.
A lay-off can occur for up to 4 weeks whereby an employee is not required at work, is not paid by the employer, and can claim social welfare payments. This could include shutting down over Christmas or in the New Year. Some organisations already include the option to shut down over Christmas in their employment contracts and request that employees hold some days from their annual leave entitlement for this purpose, generally between 2-5 days. A lay-off could be added on to this normal shut-down period to assist with a quieter time for your business, or part of your business. The whole business need not shut-down during the lay-off and only the employees affected will not attend work. Due process would need to be applied in these circumstances and justification for choosing one employee over another would need to be in place.
Short-time working occurs where a full-time employee works for 3 or less days per week either in a block of 4 weeks or for 6 non-continuous broken periods of weeks over a 13 week period. The employee is not paid for the days or hours not worked during this period and may be entitled to social welfare payments.
In these circumstances the employer must provide employees with reasonable notice of this requirement and facilitate the employee in completing social welfare forms.
A redundancy situation occurs when the work or role that the employee carries out ceases to exist and as a result the employees’ contract of employment is terminated. Employers must thread very carefully when opting for redundancy as there are legal guidelines which must be adhered to as well as exposure for future claims of unfair dismissal, particularly if the employee is replaced. Also employees with 2 year’s continuous service may be entitled to statutory redundancy payments, as well as minimum notice periods.
The following are some frequently asked questions in relation to reducing the workforce that may assist you with your own practices.
FAQ
How long does an employee have to be with the company before being entitled to a redundancy payment?
An employee must be employed with your company for 2 year’s continuously.
How much notice is an employee entitled to if they are being made redundant?
This is dependant on their length of service, starting at 1 weeks notice for employees with you more then 13 weeks, but less than 2 years. The notice periods increase dependant on length of service.
What paperwork do I need to complete?
You must complete an RP50 form for any statutory redundancies.
How long does an employee have to be employed before getting protection under unfair dismissals legislation?
1 year continuously, including any notice periods due.
How long does an employee have to be employed before getting protection under industrial relations legislation?
From day 1.
Do I have to pay for public holidays during periods of short-time working?
Once an employee has worked 40 hours in the 5 weeks preceding the public holiday they will be entitled to a benefit on the public holiday.
What happens if I have no work for the employee after 4 weeks?
Then you may have to make the employee redundant, subject to certain conditions.
What happens if I have no work for the employee after 13 weeks of on/off short-time working?
Then you may have to make the employee redundant, subject to certain conditions.
DISCLAIMER: The information in this newsletter is provided as part of Waterford Chambers newsletter for Chamber HR Club. We recommend that professional advice is obtained before relying on information supplied anywhere within this newsletter
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