Dáil debates

Wednesday, 15 September 2021

Ceisteanna Eile - Other Questions

Redundancy Payments

11:10 pm

Photo of Leo VaradkarLeo Varadkar (Dublin West, Fine Gael) | Oireachtas source

I thank the Deputy. Reckonable service is service that is taken into account when calculating a redundancy lump sum payment. The current situation is that the law provides that a period of lay-off within the final three years of service before redundancy is not allowable as reckonable service and is not included as service for the purposes of the calculation of the redundancy lump sum payment. Therefore, as matters stand, an employee who is in receipt of the pandemic unemployment payment, PUP, and who was laid off from their employment, that period of lay-off is not allowable for reckonable service. I appreciate that this is an issue for certain employees who have been on lay-off for an extended period of time, as a result of the public health restrictions. This is legally complex for several reasons, but I can assure the House that my Department, alongside the Department of Social Protection, has been examining the matter for a number of months to come up with a fair solution. One the main considerations is to ensure that any proposal does not impose any further financial burden on employers beyond their current obligations under the Act. Indeed, it is unlikely that we would be able to impose such an obligation on them retrospectively. I intend to make announcement in relation to this matter and a solution that we have developed in the coming weeks, because we need to provide fairness to workers facing redundancy due to the pandemic.

As the House is aware, the section 12(A) emergency measure was introduced because the Government was concerned that the financial impact of redundancy claims on employers would have a serious impact on their business and on the economy as a whole. This, in turn, could have resulted in significant insolvency situations and further job losses. It is also considered important for employers to have a continued link to their job and a pathway to return to.

In June, I wrote to every registered business in Ireland to thank them for their efforts to date in keeping people safe during the pandemic and to update them on the suspension of section 12(A). Companies that are genuinely unable to pay will be able to avail of a deferred payment arrangement, as confirmed in the economic recovery plan. The current end date for section 12(A) is 30 September 2021. The Government is not giving any consideration to extending this.


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