FAQ for Employers
Printed from www.survivingredundancy.ie Copyright © 2012
How do I show my remaining employees that their colleagues are being treated well throughout the redundancy process? Click here for information on help we can offer.
I am scared of making people redundant as it is so expensive.
In fact, redundancy is not usually very expensive for the employer. The employee gets 2 weeks pay for every year + a bonus week. The maximum salary on which it is based is €600 per week or €30,000 per annum. You only pay 40% of it.
So an employee with 10 years service on €80,000 will cost you €5,000 (40% of €12,600) or less than one month's salary.
You have no obligation to pay them anything other than statutory redundancy.
So for someone with 4.5 years service who earns €800 per week.
|
Two weeks for every year 2 x 4.5 |
9 weeks |
|
Plus one week |
10 weeks |
|
multiplied by maximum weekly salary |
€600 |
|
= Statutory Redundancy |
€6,000 |
| Cost to employer is 40% | €2,400 |
Try our simple redundancy calculator.
The Department of Social Welfare has a more detailed Redundancy Calculator
Must I make people redundant on a last in first out basis?
No. Some people choose this as they cost less in terms of redundancy payments, but this is a false economy. Retain those whom you need for the business.
How much notice do I have to give?
Under the Redundancy Payments Acts and the Minimum Notice and Terms of Employment Act, the following minimum notice applies.
|
Years service |
Minimum Notice |
|
Up to 5 years |
Two weeks |
|
5 to ten years |
4 weeks |
|
10 to 15 years |
6 weeks |
|
Over 15 years |
8 weeks |
If your employment contract specifies a longer period, then the longer period takes precedence.
How much statutory redundancy will I get?
You have to have a minimum of 2 years service
You will get two weeks salary for every year + one bonus week
If you earn more than €600 per week, it is calculated based on €600 per week
Is statutory redundancy taxable?
No.
