Layoff and Short-time Working under Covid-19
Under the Redundancy Payments Acts 1967 to 2014 a lay-off situation arises if an employer is unable to provide work to an employee for which they are employed to do. A short-time situation arises if an employee's weekly pay or hours is less than 50% of their normal weekly pay or hours due to a reduction in the amount of work to be done for which they are employed to do.
Continuity of Service
Continuity of service is not normally affected by lay-offs. For example, if an employee has been working for an employer for 10 years and is laid off temporarily, their 10 years’ service will remain intact.
Annual Leave
Employees working short-time will continue to accrue leave for the hours they work.
Employees on lay-off will continue to accrue public holidays that occur during the first 13 weeks. They will not accrue annual leave during the period of lay-off.
The annual leave that they accrued up until the point of being laid off will remain intact. Employers should not pay employees in lieu of this annual leave. Rather, it should be made available to the employee to take once they return to work. Given the exceptional circumstances that we are living in, it could well be the case that an employee genuinely cannot take their accrued annual leave this year. If this situation arises employers should try to be flexible in terms of allowing an employee to carry over leave into the next calendar year.
Redundancy
The law on claiming redundancy following a period of lay-off or short-time working had been changed during the Covid-19 emergency period. The emergency period is currently set as 13 March 2020 to 31 May 2020, however this may be extended.
Normally, employees who are laid off or put on short-time hours, you can claim redundancy from their employer after 4 weeks or more, or 6 weeks in the last 13 weeks.
Under the Emergency Measures in the Public Interest (Covid-19), employees who have been laid off during the emergency period, as a result of the Covid-19 pandemic, are not able to claim redundancy.
Putting staff on layoff
As the country tries to get to grips with the Covid-19 pandemic and companies are struggling with temporarily closing their business and laying-off staff, here are some key things you need to know about layoff.
Layoff or redundancy?
As a result of the recent business closures, many employees have been layed-off. Layoff is a temporary measure, whereby the individual is still an employee of the company but they are not receiving any remuneration for the duration of the layoff. Normally, once the situation that led to the layoff is over, the employee will return to their previous role on the same terms and conditions, their length of service will not be impacted by the layoff. In the current situation, it is hoped that many business will be able to re-engage their staff once the current emergency situation eases.
Redundancy on the other hand occurs when the employee loses their job permanently, due to a business closure or a reduction in work levels.
Other Layoff Considerations
- Employers should give employees notice in writing that they will be put on layoff, although no time period is specified
- Notice can be given using form RP9
- Generally, in order to layoff an employee there should be a layoff clause in the contract of employment or it should be custom and practice in the company. It is imagined that flexibility will be shown at this exceptional time, if neither of these exist. However some employers may consider:
- including a layoff clause in the agreed terms of employment on a temporary basis,
- getting some form of confirmation, signature or email, from the employee to the layoff.
