Written answers

Tuesday, 5 December 2023

Department of Enterprise, Trade and Employment

Redundancy Payments

Photo of Seán CanneySeán Canney (Galway East, Independent)
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211. To ask the Minister for Enterprise, Trade and Employment to outline the supports that are available to employees who are owed wages from their employer who has closed his business. [53209/23]

Photo of Neale RichmondNeale Richmond (Dublin Rathdown, Fine Gael)
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Ireland has a robust suite of employment rights legislation in place to protect and support workers.

Statutory and contractual employment terms apply in relation to the payment of wages. Failure to pay all or part of the wages due to an employee is considered an unlawful deduction and a complaint can be made under the Payment of Wages Act, 1991.

The Payment of Wages Act 1991 establishes a range of rights for all employees in relation to payment of wages. The Act regulates how wages and salaries are paid and what deductions may be made from same. Under this Act, an employer is not permitted to make deductions from an employee's wages unless the deduction is authorised under the contract of employment, required by statute, or is made with the prior written consent of the employee.

If an employee believes that their employer has made an unlawful deduction from their pay, then they may refer a complaint to the Workplace Relations Commission (WRC).

It is unclear from the question whether the company is insolvent or has gone into liquidation but either way, the employees are entitled to pursue a claim for non-payment of wages either from the employer or the liquidator as the case may be.

It is the employer’s responsibility in the first instance to pay statutory redundancy to eligible workers. If employers are genuinely unable to pay redundancy due to financial difficulties or insolvency, the State provides a safety net and may make the statutory redundancy payments on the employer’s behalf from the Social Insurance Fund through the Redundancy Payments Scheme. The scheme is administered by the Department of Social Protection.

The Insolvency Payments Scheme is to protect certain outstanding pay-related entitlements due to employees in the event their employer becomes legally insolvent. Employees may claim, through an employer representative, such as the official liquidator, various outstanding debts including arrears of wages, holiday pay, statutory minimum notice. Payments are made from the Social Insurance Fund and the scheme is administered by the Department of Social Protection. The arrears of wages, holiday pay and minimum notice payable under the scheme are subject to a ceiling of €600 per week and are limited to 8 weeks.

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