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Termination

Notice

Are employers required to give notice of termination?

Statutory minimum periods of notice apply by virtue of the Minimum Notice and Terms of Employment Acts 1973 to 2005. In addition, in certain circumstances, absent any agreed notice period, the courts may imply a term into an employment contract to determine that the contract can be terminated on reasonable notice. What constitutes ‘reasonable’ depends on the circumstances and can range from one month for junior employees to 12 months for senior executives.

Redundancies

What are the rules that govern redundancy procedures?

Specific statutory redundancy rights exist for employees with at least two years’ continuous service:

  • Notice entitlements – employees selected for redundancy are entitled to:
    • the greater of statutory minimum notice under the Minimum Notice and Terms of Employment Acts 1973 to 2005 or notice in accordance with their contracts;
    • a minimum of 14 days’ notice of their redundancy under the Redundancy Payments Acts 1967 to 2012, which may run concurrently with their contractual or statutory notice entitlement; or
    • payment of salary in lieu of that notice period, if contractually provided for or accepted by the employee.
  • Statutory redundancy payment – employees with over two years’ service are entitled to a lump-sum statutory redundancy payment. The minimum statutory lump-sum payment is calculated as:
    • two normal weeks’ pay for each year of continuous and reckonable service with the employer over the age of 16 years; and
    • one additional week’s pay.

In each case, a week’s pay is capped at €600.

Employers must consult appropriately with affected employees before making decisions on redundancy, informing the employees of the possibility of redundancies and the business reasons for these. Employers must consider alternatives to making employees redundant, including alternative positions. Employees should be invited to conduct a similar exercise. If no alternatives are available, employers are not required to create positions.

Are there particular rules for collective redundancies/mass layoffs?

The Protection of Employment Act, 1977, as amended by the Protection of Employment (Exceptional Collective Redundancies and Related Matters) Act, 2007, contains certain notification and consultation obligations that apply where an employer is planning to implement a collective redundancy. A collective redundancy is the dismissal for reasons unconnected to the individual employee (ie, redundancy) over any period of 30 consecutive days, of at least:

  • five persons in an establishment that normally employs more than 20 and fewer than 50 employees;
  • 10 persons in an establishment that normally employs at least 50 but fewer than 100 employees;
  • 10% of the number of employees in an establishment that normally employs at least 100 but fewer than 300 employees; or
  • 30 persons in an establishment that normally employs 300 or more employees.

‘Establishment’ is defined in the Protection of Employment Act, 1977 as “an employer or a company, or a subsidiary company, or a company within a group of companies which can independently effect redundancies”. 

When calculating the number of employees normally employed in an establishment, employers must take the average of the number employed in each of the 12 months preceding the date on which the first dismissal takes effect.

In relation to the employer’s information and consultation obligations under the act, the key points for consideration are as follows:

  • Consultation with employee representatives should take place at the earliest opportunity and, in any event, at least 30 days before the first notice of dismissal is given; and
  • Collective redundancies cannot take effect until 30 days after the date of notification to the minister for jobs, enterprise and innovation.

Protections

What protections do employees have on dismissal?

Where an employee has accrued one year’s continuous service, he or she is entitled to protection under the unfair dismissal legislation. Under this legislation, the employee may be awarded up to two years’ remuneration by the Workplace Relations Commission (WRC), reinstatement or re-engagement.

Employees may bring claims for discriminatory dismissal under the equality legislation where their dismissal was related to a discriminatory ground. There is no service requirement for bringing such a claim. Again, an award of compensation of up to two years’ remuneration can be made by the WRC. However, where an employee brings a claim for unfair dismissal and discrimination, he or she must elect which claim to pursue before the WRC. Typically, complaints to the WRC must be presented within six months of the date of the alleged legislation breach. The timeframe for submitting a complaint to the WRC may be extended by a further six months if there is “reasonable cause for the delay”.

Employees may also seek a High Court injunction to restrain an employer from implementing a dismissal. An injunction preserves the status quo pending the determination of the employee’s breach of contract claim. If granted, it typically includes an order to maintain salary pending trial, which could be nine to 12 months away, with the risk of an order requiring the employer to reinstate the employee at trial. 

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