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Redundancy – Calculation of Entitlements for Employees whose hours of work may vary

Unfortunately redundancies are becoming more and more common in light of covid-19 and the ongoing challenges it places on both employers and employees.The recent case of Tarossa Freehill Limited and Mary O’Reilly RPD203 concerned an appeal by the employer in respect of a previous Workplace Relations Commission decision in respect of the Redundancy Payments Acts 1967 (as amended). The employee had previously won her case in respect of an entitlement to statutory redundancy and was awarded €7,648.The employer argued that the claimant had never given any notice of her intention to claim redundancy and that section 24 of the Redundancy Payments Acts provides that, in order for an employee to receive redundancy lump sun, payment must either be agreed and paid or a claim by notice in writing must be made within 52 weeks of the date of dismissal.The Labour Court accepted the evidence of the Complainant that she hand delivered a letter dated 7 December 2017 seeking payment for redundancy and, therefore, met the requirement as set out in s.24. The Court further noted:Because the working hours of the Complainant varied from week to week, the provisions of s.20 of Schedule 3 of the Act are applicable for the purposes of calculating the correct rate weekly earnings in order to then calculate the correct rate of redundancy payment. This was not disputed by the Complainant’s representative. This requires a calculation of the average earnings of the Complainant in the 52 weeks preceding the redundancy on 17 November 2017. The earnings in that period were €15950.40, divided by 52 =€306.74. That figure is the weekly earnings on which the redundancy payment must be calculated. The Complainant has service of 9 years and three weeks. The total amount due is €5858.60″Employers should be mindful of the above decision in respect of calculating statutory redundancy entitlements for employees whose hours of work may vary. The case is also useful insofar as it sets out the law in respect of redundancy including to be mindful of either laying employees off or putting them on short time as they may still have an entitlement to redundancy after a period of time. 

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