Collective redundancy

Collective redundancy. Redundancies above a set number within a set period. They trigger consultation and notification duties.

What it is

A collective redundancy is a set of redundancies large enough, within a short enough period, to bring in the Collective Redundancies (Protection of Employment) Regulations (S.L. 452.80). They give effect to the EU directive on collective redundancies, and article 37 of the Employment and Industrial Relations Act makes failure to comply an offence.

When it applies

It is a termination of employment by the employer on grounds of redundancy, over a period of thirty days, of (regulation 2):

Establishment normally employing Collective redundancy if
more than 20 and fewer than 100 employees 10 or more are made redundant
100 to 299 employees 10% or more are made redundant
300 or more employees 30 or more are made redundant

Other terminations at the employer’s initiative, for reasons beyond the control of the individual employees, count towards the number, provided there are at least five redundancies. Fixed-term and specific-task contracts are left out, unless they are ended early because of redundancy (regulation 3).

What the employer must do

  • Notify the employees’ representatives in writing of the terminations it is contemplating (regulation 4).
  • Inform: within seven days, give them a written statement of all relevant information, including the reasons, the number of employees to be made redundant, the number normally employed, the proposed selection criteria, any redundancy payments due, and the period over which the redundancies will take place (regulation 6).
  • Consult: consultation must begin within seven working days of the notification, and covers ways of avoiding the redundancies or reducing their number, and of mitigating their consequences (regulation 5).
  • Copy the Director: send copies of the notification and the statement to the Director responsible for employment and industrial relations on the same day (regulation 8).
  • Wait: the redundancies take effect only thirty days after that notification. The Director may shorten the period in exceptional circumstances, or extend it by a further thirty days. Individual notice may run from the start of consultation (regulation 9).

These duties apply whether the decision was taken by the employer or by a company that controls it, and the employer cannot excuse a breach by saying the parent did not give it the information (regulation 7). A breach is an offence carrying a fine of at least €1,164.69 for every employee declared redundant (regulation 11).

Where it goes wrong

  • counting too narrowly, by splitting dismissals across periods or sites;
  • consulting after the decision has, in practice, been made;
  • selecting outside the right class of employment, or leaving out people doing the same work;
  • treating a sale or outsourcing as a redundancy when it is a transfer of business.

Each of these invites claims and costs goodwill with the staff who stay.

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