Number of notified redundancies triples in two years

THE number of notified redundancies tripled between 2007 and 2009 – but employers on the whole are resisting the urge to reduce redundancy payments in the current climate.

There were 77,001 redundancies in 2009 compared with 25,459 in 2007. In fact, according to Industrial Relations News (IRN), the 2009 total was greater than in the three years from 2005-2007.

IRN has published a sample list of 148 redundancy settlements, including 59 Labour Court cases, which occurred in 2009.

It found a major difference between severance packages in this recession compared to previous decades was that the statutory minimum was significantly higher at two weeks’ pay per year of service due to the increase negotiated by the social partners.

It also found that while most companies who had previous redundancy drives tried to offer the same redundancy terms this time round, while in some cases, severance terms dropped in value by as much as 50%.

Of the 59 cases concerning redundancies before the Labour Court during the year, 48 dealt with the level of severance pay involved.

Half of those were claims by unions or workers for an increase in an ex-gratia settlement already offered by the company.

The rest involved companies that had offered statutory redundancy only, with the unions/workers seeking some level of enhanced ex-gratia severance payment as well.

“Many of the cases involving the latter involved individuals or small numbers of people... where funding for enhanced redundancy was problematic,” IRN said.

“In almost all of these cases, the Labour Court recommended some level of enhanced severance, which at times was substantial.”