These unprecedented times have led to significant changes in working conditions, with many businesses having no option other than to consider lay-off and short-time.
Lay-off involves the temporary cessation of employment. Employers should be aware that there is no automatic right to lay-off staff without pay, unless it is specifically set out in the Contract of Employment or Staff Handbook, or unless it can be established that it is custom and practice within the organisation. In practice, employees are inclined to accept lay-off without pay in the hope of avoiding a redundancy situation. Best practice suggests that lay-off notice is served in writing via Form RP9 available from the Workplace Relations Commission, and the employee should be given as much as notice as possible.
Short-time involves a shortage of work whereby the employee’s weekly pay is less than half of their normal weekly pay, or the employee is working less than half the normal contracted weekly hours. Again, this is a situation which is reasonably believed by the employer to be temporary. As with lay-off, it is important that the Contract of Employment specifies that employees are paid for hours actually worked while on short-time, unless a customary practice has been established in the industry or organisation. In a situation where an employee is faced with a choice between reduced pay for short-time, and a redundancy situation, it is likely that they will agree to the short-time option.
During lay-off or short-time the employee is still employed, and the Contract of Employment remains in force. The employee is entitled to the benefit of any public holidays occurring during the first 13 weeks of lay-off, and while they do not accrue annual leave during lay-off, they are entitled to take annual leave accrued before being laid off.
Changes to redundancy rules during Covid-19
Under normal circumstances, if an employee is laid off or put on short-time hours, they can claim redundancy from their employer after 4 or more consecutive weeks, (or 6 weeks in the preceding 13 weeks). The emergency measures in the Public Interest (Covid 19) Bill provides that an employee is not able to claim redundancy during the emergency period, if they were laid off or put on short-time work as a result of the Covid 19 pandemic. The emergency period set out in legislation is 13th March 2020 to 31st May 2020, which may be extended.
Social Welfare Entitlements on lay-off and short-time
Employees who are laid-off temporarily as a result of the Covid 19 crisis can apply for Jobseekers Payment at www.mywelfare.ie. Employees who are put on short-time working hours by their employer due to a reduction in business activity related to Covid 19 may apply for a short-time work support payment which application may be made in person at an Intreo Centre. If your employer is able to continue to pay the employee under the temporary Covid 19 Wage Subsidy Scheme, the employee does not need to apply for a Social Welfare payment. If the employer cannot pay for this period, the special Covid 19 Pandemic Unemployment Payment is available at a flat rate payment of €350.00. This payment is for employees and self-employed people living in Ireland who have lost all their employment due to the Covid 19 public health emergency.