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Layoff timespan crucial in totting up redundancy payoffs
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16 Sep 2020 / employment Print

Virus lay-off timing crucial in redundancy pay-off tot-up

A Mason Hayes & Curran LLP webinar on ‘HR in the New Normal’ heard this morning that short-time lay-offs were a crude tool used in early lockdown, given the speed of the measures’ introduction.

These lay-offs were supplemented by various State payment schemes introduced, but full redundancy is likely to loom larger for many workers in the near future.

“Now people have visibility of what their workplace is going to look like, and this will lead to more and more redundancies being considered,” MH&C partner Ger Connolly said.

Redundancy selection processes should be carried out across all employees, and not just those on lay-off, was the lawyers' advice.

Those who are laid off or on short time are "not automatically lawfully or correctly selected" for redundancy, because the country shut down very quickly with the onset of the virus.

And the MH&C lawyers cautioned that redundancy selection difficulties have always existed, for example, for those on sick leave or maternity leave.

“Those issues could be identified now, for vulnerable people, or those with an underlying illness, or older people who are more at risk from COVID-19,” the lawyers said.

“You don’t want to be seen to be simply selecting those people because they are less likely to come back to the office.”

The MH&C lawyers suggested that employers restart the whole redundancy process, particularly with lay-offs that were only intended for the short term.

Calculating redundancy

Over one million people will have received a State payment this year, so this throws up the question of what salary or weekly wage is used for calculating redundancy, Ger Connolly pointed out.

Employees on a COVID lay-off payment cannot currently claim redundancy.

This rule could yet be done away with, though an employer can still decide to implement redundancies currently.

The salary calculation for a redundancy pay-out will be based on earnings for a full week, if the timescale is within one year of the employee going on short time, and reduced money.

For redundancies initiated more than a year after short-time working, the payment calculation will depend on whether they accepted being put on reduced hours.

“That is a rule that I’m not sure is entirely fair … lots of people had no choice but to accept being put on reduced hours,” said associate Avril Daly.

Statutory redundancy entitlements will be calculated on the basis of normal pay, before a worker began on COVID payments.

Employers making redundancies may also seek to reduce or eliminate ex-gratia payments, on top of statutory entitlements, the seminar heard.

However, if there is a consistent practice within an organisation, of for instance four weeks’ pay per year of service, employees could argue that they have a contractual right to that package, by virtue of custom and practice.

Attendance at office

Employees who do not wish to attend their office because of COVID can also be compelled to take annual leave.

However, the employee’s opportunities for rest and recreation throughout the rest of the working year must also be taken into account.

Technically, 30 days’ notice must also be given for annual leave, MH&C employment associates Avril Daly and Orla O’Leary said at the webinar this morning.

Fewer than 30 days’ notice for annual leave would be a breach of legislation, the lawyers noted.

Practicality

Chaired by partner Ger Connolly, the session heard that since we are living in exceptional times, the practicality of leave requests may also have changed.

The theme of the organisation of working time legislation is that of proper rest and relaxation for employees, the speakers pointed out.

Employees can also be asked to take unpaid leave, but clear agreement is advised about both terms and duration.

A reasonable approach is essential and some employees may agree to taking unpaid parental leave, which can be broken up into blocks or hours, up to a maximum of 26 weeks.

New parents’ leave is also now available under the law, giving employees State benefits for the period off, provided they have enough PRSI contributions.

This leave must be taken within a year of the child’s birth or adoption, and the duration may yet be increased in October’s Budget ’21.

Technically, employees are required to give six weeks’ notice before taking such leave but this may not be practical in the current situation, the seminar heard.

Flexible

“Employers should try to be as flexible and accommodating as possible,” Avril Daly said.

She suggested that employers also consider flexible working options for employees, to work shorter hours, for instance, or earlier or later start times.

“The first port of call is to sit down with the employee, or by Zoom, and chat about all reasonable and practical options,” she continued.

‘Reluctant’ employees may be fit and healthy yet fearful about going back to work or using public transport.

‘Vulnerable’ employees are another category, where there is an underlying health condition, either directly or in a family member.

For ‘reluctant’ or fearful workers, who are otherwise fit, an employer’s obligations are in line with current Government advice, updated yesterday, which is to work from home if possible and only attend the office for essential onsite meetings, inductions, or training.

Off-peak work

“In that scenario, you have to engage with the employee and see if you can address their concerns directly,” Orla O’Leary said, suggesting that off-peak work which avoids public transport could be a solution.

But, if all reasonable responses are exhausted, a ‘robust’ response may require that the employee attend work, as per their contract of employment, or there is no entitlement to be paid.

The HSE has two categories of risk – ‘extremely vulnerable’ and ‘high-risk’, depending on medical condition and age.

The employer should follow advice from an occupational health advisor.

A high-risk employee could attend work but remain two metres apart from all other individuals while at work.

Overlap

The treatment of vulnerability in the context of COVID, and disability under employment legislation, are likely to overlap considerably, the seminar heard.

Employers have a statutory duty towards employees who have a disability, to actively engage to establish which measures will allow them to continue work, such as alternative duties, or changed working hours.

If the employee has a medical certificate confirming a medical condition, and stating that they should not attend the office, then the employee’s absence is going to be considered sick leave and it should be managed in the normal course, the webinar heard.

Medical cert

Without a medical cert, the employer is within their rights to require the employee to work from the office, or run the risk of not being paid.

Employment equality law prohibits discrimination on the grounds of an employee associating with a vulnerable person, even if they are fit themselves.

Engage with the employee to find reasonable measures to reduce risk, is the first port of call, the seminar heard.

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