Written answers

Wednesday, 31 March 2021

Department of Enterprise, Trade and Employment

Covid-19 Pandemic Supports

Photo of Niamh SmythNiamh Smyth (Cavan-Monaghan, Fianna Fail)
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182. To ask the Minister for Enterprise, Trade and Employment the steps that have been introduced for small businesses, as in the case of a business (details supplied) that has no choice but to offer redundancy packages to employees, given the business will struggle to reopen. [16690/21]

Photo of Leo VaradkarLeo Varadkar (Dublin West, Fine Gael)
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I am acutely aware of the difficulties that the necessary ongoing Covid-19 restrictions are putting on businesses. With that in mind, the Government has put in place an unprecedented package to help businesses, including the Employment Wage Subsidy Scheme, the COVID-19 Restrictions Support Scheme, low-cost loans, the deferral and warehousing of tax liabilities and the waiver of commercial rates.

I also recently announced the new Small Business Assistance Scheme for COVID, details of which are available on www.enterprise.gov.ie. The closing date for Local Authorities to receive applications for this scheme is 21st April 2021.

If an employer must make an employee redundant, it is the responsibility of the employer to pay statutory redundancy to its eligible employees. However, in situations where an employer cannot sustain the cost of redundancy payments due to financial difficulties, the State may provide a safety net for both employers and employees by making the statutory redundancy payment to eligible employees on behalf of the employer.

When such a redundancy payment is made from the Social Insurance Fund, a debt is raised against the employer. The Department of Social Protection engages directly with the employer to ascertain their financial situation and their capacity to repay the debt. Where appropriate, an agreed repayment plan can be put in place to minimise financial hardship. For example, the debt can be recovered by way of instalments over a period of time.

The redundancy rebate scheme was abolished in 2013 as it was not deemed a targeted use of resources. In contrast, the Redundancy Payments Scheme as it now operates benefits employees whose employers are unable to make statutory redundancy payments. The scheme considers both an employer’s ability to pay and that the Social Insurance Fund can be reimbursed in the future, through debt repayment if an employer’s financial position improves. This is a more targeted use of funds.

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