Michael McGrath (Cork South Central, Fianna Fail)
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Question 103: To ask the Tánaiste and Minister for Enterprise, Trade and Employment if she will make a statement on a redundancy issue (details supplied). [41113/09]

Dara Calleary (Mayo, Fianna Fail)
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My Department administers the Social Insurance Fund (SIF) in relation to redundancy matters on behalf of the Department of Social and Family Affairs. There are two types of payment made from the SIF — rebates to those employers who have paid statutory redundancy to eligible employees, and statutory lump sums to employees whose employers are insolvent.

Payment of statutory redundancy is, in the first instance, a matter for the employer. When an employer has paid statutory redundancy to a former employee the Department, which administers the Redundancy Payments Scheme on behalf of the Department of Social and Family Affairs, will then pay the employer a 60% rebate.

In the case of lump sum redundancy claims where the employer is unable to pay the redundancy entitlement and provides evidence of such to the satisfaction of the Department, payment is made from the Social Insurance Fund and the Department then seeks to recoup 40% of the amount paid out from the employer.

If the employee believes he/she is entitled to a redundancy payment and the employer fails to complete the RP 50 form and/or fails to provide the evidence of inability to pay to the Department to allow the former employee to claim the lump sum, it is then open to the employee to bring a claim against his former employer before the Employment Appeals Tribunal for a decision in the matter. If the Tribunal decides in favour of the employee, the Department is then in a position to pay the statutory lump sum to the employee out of the Social Insurance fund on foot of the Tribunal determination. The Department then views the employer as a defaulter and seeks to recover from the employer the full amount of the redundancy payment to the Social Insurance Fund.

In all cases where a redundancy lump sum claim is lodged by the employer on behalf of an employee but the employer pleads inability to pay the statutory redundancy entitlement, the Department requests evidence of inability to pay from the employer. This includes a copy of the latest set of audited accounts and a statement from the company's accountant or solicitor attesting to this situation. If this is provided the Department will make the payment from the Social Insurance Fund and if this is not provided, the Department then advises the employee to take a case to establish redundancy entitlement to the Employment Appeals Tribunal (EAT). If a positive determination is obtained from the EAT, the Department will pay the employee the statutory redundancy lump sum and then seek to recoup the relevant amount from the employer.

Eligibility for statutory redundancy requires that:

The employee must have at least two years continuous service (104 weeks).

The employee must be in employment which is insurable under the Social Welfare Acts.

The employee must be 16 years or older

The employee must have been made redundant as a result of a genuine redundancy situation.