Redundancy

A redundancy means the loss of employment a dismissal wholly or mainly attributable to the fact that the employer has ceased or intends to cease to carry on the business for the purposes of which the employee was employed or to carry on that business in the place where the employee was employed. Redundancy also arises where the requirements of the business for employees to carry out work of a particular kind has ceased or diminished or is expected to cease or diminish. Employees are entitled to be consulted about redundancy and warned that they are at risk of redundancy.

A redundancy occurs when an employer feels it needs to reduce the number of employees. For a person to make a redundancy claim, the employee must have been employed for two continuous years.
Employees must be informed of the potential redundancy, prior to the redundancy. In other words, the employee cannot be told and made redundant on the same day.

Before the final decision is made as to who will be made redundant, employers must go through a process. The employer must adopt objective and appropriate criteria when deciding who is to be made redundant. The extent of the process depends on the number of redundancies to be made.

Employees may claim for compensation if they lose their job as a result of a redundancy. Redundancy compensation is determined by statute. Redundancy compensation is not equal to the person’s salary. The statutory entitlement to redundancy compensation is calculated by the employee’s age, number of years of employment, and the employee’s income.
 

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