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Redundancy

Lay-off and Short Time and Coronavirus-the Essentials

“Lay-off” and “short time” are phrases that are being bandied about now because of COVID-19. Do you know what they actually mean from an employment law perspective?

“Lay-off” is defined in the Redundancy Payments Acts 1967-2014 and happens when the employer is temporarily unable to provide work for the employee.

“Short time” describes the situation where the employer cuts the wages or hours of the employee to less than 50% of the normal hours or pay.

The employee is supposed to be given notice, although no time period is specified, and the employer must reasonably believe it is only for a temporary period of time. Choosing employees for lay off or short term should be done fairly and in a way that will not give rise to a claim of discrimination.

Pay

The employer cannot, at common law, put an employee on lay-off without pay or place him on short time unless

  1. There is a clause in the contract allowing lay-off or
  2. There is an implied right to do so

The implied right would derive from custom and practice in the industry or in the particular employer’s business.

However, there has been decided cases in the WRC (Workplace Relations Commission) or the Rights Commissioner Service/Employment Appeals Tribunal that held there is an established practice in Ireland that lay-off without pay can be permitted where it can be shown that it is custom and practice in the industry/trade.

Redundancy

The employee may be entitled to redundancy. If she has been laid off or on short time for 4 or more consecutive weeks or for 6 weeks (not more than 3 consecutive) in a 13 week period the employee can serve a notice on the employer to claim redundancy. The employer, however, can serve a counter-notice denying the redundancy if he can give the employee 13 weeks work without lay off or short time. This work must be available within 4 weeks of the employee’s notice.

Alternatives to lay-off and short time

Alternatives to lay-off and short time include 

  1. Annual leave
  2. Parental leave
  3. Unpaid leave

Both employer and employee need to be flexible at this time.You can learn more about short time, lay-off, and redundancy here.