Collective Redundancies: Employers’ Legal Obligations

4th May 2020

Amid the global concerns on the economic downturn many states are facing due to the COVID-19 pandemic, we’ve unfortunately already begun seeing the negative effects the crisis is having on local businesses, having already been engaged by particular companies in effecting proper redundancies.

Stultified economic stimulation has not only affected our small-scale local homerun businesses, but it has also seen large companies and corporations having to significantly cut down on their expenses, with some even being pushed to close their doors permanently. In a situation where a significant number of employees are being made redundant, it is of utmost importance to follow the provisions of the Collective Redundancies Regulations, which apply to redundancies effected over 30-day periods of:

  • 10 or more employees in establishments employing 20 to 99 employees
  • 10% or more of employees in establishments employing 100 to 299 employees
  • 30 or more employees in establishments employing 300 employees or more

A salient feature introduced by the Regulations obliges employers to notify employee representatives in writing (who should have been appointed or elected in terms of the Employee (Information and Consultation) Regulations. A copy of the notice should also be forwarded to the Director of the DIER. Representatives are naturally permitted to have their say (within no more than 7 days from the notification) in assessing methods to avoid redundancies altogether or at least have them effected with the least possible impact. Within the 7-day period aforementioned, the employer must also provide a written statement with the following information:

  • The reason for redundancies
  • The number of employees to be made redundant
  • The number of employees normally in employment
  • The criteria for selection of employees to be made redundant
  • Details on redundancy payments due
  • The period over which the redundancies will occur

This statement must also be delivered to the DIER Director. In general, the effective date of the redundancies must be at least 30 days following the notification to the Director, which period may however be reduced or extended by the Director depending on the circumstances.

Compliance with the Regulations is key.  Offences in contravention of the provisions of the Regulation can amount to a fine of at least €1,164.69. The 21 Law team is always ready to help should employers need assistance in effecting redundancies, or should employees be concerned as to the legitimacy of the way in which they were made redundant.