Redundancy and Severance Agreements

Redundancy and Severance Agreements

Unfortunately, due to a multitude of issues including rising cost of living, energy uncertainty and a reduction in available investment capital , many employees are being faced with the prospect of redundancy as their employers reduce the company headcount or as businesses cease trading entirely. However, regardless of the economic climate, employers are required to ensure that redundancy is both fair and valid. The purpose of this article is to provide guidance on what is required in order for a redundancy to be fair and valid and to provide insight into the effect of entering into a Severance Agreement in a redundancy situation.

Reasons For Redundancy

In order for a redundancy to be valid, the dismissal must arise for one of the following reasons:-

  1. Where an employer has/intends to cease carrying on its business, or at that location i.e. where the business moves to another location.
  2. Where the requirements for an employee to carry out work of a particular kind in the place where he/she was employed has/is expected to cease or diminish i.e. there is no longer a requirement for that role to be carried out.
  3. Where the employer has decided to carry on the business with fewer or no employees i.e. a reorganisation with fewer staff.
  4. Where an employer has decided that the work for which the employee has been employed should from now on be done in a different manner for which the employee is not sufficiently qualified or trained i.e. a reorganisation where the employee is not sufficiently trained and training would not be a viable option.
  5. Where it is decided that the role for which the employee has been employed should from now on be carried out by a person who is also capable of doing other duties for which the employee is not sufficiently qualified or trained, i.e. job enlargement where training would not be a viable option.

Collective Redundancies

The Protection of Employment Act 1977 was revised in October 2020 and governs the mandatory process that must be adhered to by employers who are proposing collective redundancies. Collective redundancies are where a specific number or percentage of employees, as set out in the legislation, are laid off for reasons which do not relate to a specific individual. Collective redundancies are not just limited to large companies and can include companies with as few as 20 employees.

Under the Protection of Employments Act, the employer must engage in a consultation process with employees with a view to reaching agreements and to consider alternatives such as avoiding redundancies or reducing the number of employees impacted. Where proceeding with making employees redundant, the company is obliged to provide information to those affected/their representatives (e.g. a trade union) including, i) the reason for proposed redundancies, ii) the number, description of categories of employees to be made redundant and iii) the selection criteria by which their decisions were made. Employees are also entitled to detail as to the calculation of ex gratia redundancy payments and the period of time over which it is proposed to make employees redundant.

In addition, employers are obliged to notify the Minister for Enterprise, Trade and Employment at least 30 days before the first redundancy takes effect. No redundancies can take place for this 30-day period from notification to the Minister. This notification must also include details of the consultation with the employees or their representatives.

The Selection Process

An important factor in the redundancy process is the selection criteria. While there is no set selection method outlined in legislation, the two main methods adopted are:

  1. Last in first out (LIFO).
  2. Selection process – for example, an interview or selection matrix where employees are scored against a list of pre-agreed criteria, levels of key skills held by employees as well as other work-related matters such as length of service, disciplinary record, punctuality and absenteeism where relevant.

The Consultation Process For Non-Collective Redundancies

In circumstances where your redundancy is not collective, there remains an alternative process which should be carried out over at least a two-week period (Employees who are impacted must be informed that they are ‘at risk’ of being made redundant.

Employees must be informed of:-

  1. The proposed redundancy;
  2. The procedures which will be followed;
  3. The selection criteria that will be used;
  4. Possible alternative positions within the company.

Employees should be issued with an ‘at risk letter’ following the initial meeting. Employers should also continue to consult with employees throughout the consultation process. Where no alternative to redundancy can be found, a final meeting should be held with employees to inform them whether or not they are being made redundant and what redundancy payment they will be paid, if they are entitled to one. Employers are then required to issue the relevant employees with their formal Notice of Redundancy.

Statutory Entitlements On Redundancy

The statutory redundancy payment is a lump-sum payment based on the pay of the employee. All qualifying employees with 2 years-service or more are entitled to:

  • Two weeks’ pay for every year of service over the age of 16; and
  • One further week’s pay.

The amount of statutory redundancy is subject to a maximum earnings limit of €600 per week. It is also common place for employers to offer ex-gratia payments on top of the statutory payment, however, there is no obligation on an employer to do so. Open Statutory redundancy entitlements calculator.

Severance Agreements

It is not uncommon for employers to request employees to execute a Severance Agreement in exchange for an ex gratia payment. Generally speaking, a Severance Agreement will prescribe the entire terms of the termination of the employment. A Severance Agreement can be a very useful tool for an employee. It can have the effect of securing a contractual commitment from an employee that he/she will not bring any form of claim against the employer in the future in exchange for a payment (the ex gratia payment). From the employee’s point of view, it is crucially important that independent legal advice on the effect and implication of the Severance Agreement is obtained. The agreement will contain a full waiver in favour of the employer preventing the employee from taking any case whatsoever against the employer.

Here at Amorys we regularly provide both employers and employees with advice in relation to redundancy and Severance Agreements. If you need any information in relation to redundancies or have been provided with a Severance Agreement, Amorys can assist you.

Whilst every effort has been made to ensure the accuracy of the information contained in this article, it has been provided for information purposes only and is not intended to constitute legal advice. Amorys Solicitors is a boutique commercial and private client law firm in Sandyford, Dublin 18, Ireland.

For further information and advice in relation to “Redundancy and the Impact of Severance Agreements”, please contact Brian Kirwan, Partner, Amorys Solicitors, telephone 01 213 5940 or your usual contact at Amorys.

Re-Mortgaging a Property in Ireland

Re-Mortgaging a Property in Ireland

The process of re-mortgaging is very often perceived in Ireland as a difficult process that may not be worth the hassle. This perception often arises from the experience of moving homes which people will often find to be a stressful experience. Re-mortgaging however can be a much more straight-forward experience.

With the current significant increase in the cost of living and current lower rates which the pillar banks have been offering, re-mortgaging may lead to significant monthly savings.

The vast majority of the work to be undertaken will be carried out by your solicitor who will take up your title deeds from your current lender, investigate title and arrange for the drawing down of your new mortgage as well as discharging the old mortgage. Typically, clients would be required to attend at our offices for the purpose of a re-mortgage on one occasion only to execute the necessary documentation.

It is also noteworthy, that whilst interest rates in Ireland are currently the second highest in the Eurozone, they have fallen dramatically in recent times. Arising from the decrease in rates and the entrance of new lenders into the market, the savings that can be made on the monthly repayments for a typical Dublin mortgage can be significant. From a financial viewpoint, there has never been a more opportune time to review your mortgage.

At Amorys, we will look after the majority of the process on your behalf. We have a large residential property department and have been providing legal advice in relation to residential property for in excess of thirty years. We offer fixed fee rates in relation to re-mortgaging.

If you would like any further information in relation to re-mortgaging or in relation to our residential property services then please contact Brian Kirwan at, telephone 01 213 5940 or your usual contact at Amorys.

Personal Injuries – The MIBI

The MIBI – Questions & Answers

  • What is the MIBI?
  • This is an acronym for the Motor Insurers Bureau of Ireland.
  • What does it do?
  • The State is obliged by the European Union Motor Insurance Directive 2009/103 to have a system for compensating the victims of uninsured motorists who have sustained personal injuries. This directive is implemented in Ireland by legislation and by an agreement between the Minister for Transport and the MIBI (“the MIBI Agreement”).
  • How is the MIBI structured?
  • It is a not-for-profit private company limited by guarantee.  All insurance companies authorised to issue motor insurance policies in Ireland must be members of the MIBI. All these companies are bound to contribute to a fund required to discharge MIBI claims each year.
  • What is the precise obligation of the MIBI?
  • The obligation of the MIBI in the case of an identified driver is to pay a judgement obtained against that driver when uninsured which judgement remains unsatisfied within 28 days. In other words, the case proceeds against the identified but uninsured driver and a judgement against the driver must be paid by the MIBI. Where the driver is untraced, the MIBI will be the defendant in your case.
  • How do I make a claim if I sustain personal injuries due to the negligence of an uninsured driver?
  • The MIBI Agreement deals with this by allowing the injured party to apply to the MIBI for compensation.  First of all, the personally injured party must apply to the Personal Injuries Assessment Board (“PIAB”).  Where the MIBI offers compensation that is unacceptable to the plaintiff then PIAB will issue an “authorisation” allowing you to proceed with the claim through the Courts.
  • What happens if I sustain personal injuries through the negligence of a driver who had insurance but whose insurer is insolvent?
  • The Irish Court of Appeal has held that the MIBI Agreement was intended to cover such a situation and in such circumstances therefore the MIBI would be obliged to pay the compensation awarded to you against the driver.
  • What happens where the driver of the vehicle who caused my personal injuries is untraced?
  • This is also covered by the MIBI Agreement but strict time limits do apply to the obligation to issue proceedings. Thus it is very important to obtain skilled legal advice as early as possible subsequent to your accident.
  • What happens if my personal injuries were caused by an uninsured driver – not by the negligent driving of the car – but as a result of the vehicle being used as a weapon?
  • In a very recent case of Mongan -v- Mongan and the MIBI which was decided earlier this year, i.e. 2020, the High Court decided that the MIBI was liable for injuries caused in such circumstances as a result of an assault and battery where the vehicle was used as a weapon against the plaintiff who sustained serious personal injuries. The High Court made it clear that people should be and will be protected should they find themselves personally injured and victim of assault and battery where a motor vehicle is used as a weapon.
  • What happens if there is uncertainty as to liability between two uninsured defendants?
  • This is a very good question and can often give rise to difficult legal problems. The short answer to your question is to seek legal advice at a very early stage from an experienced personal injuries solicitor who will guide you through the numerous pitfalls and legal complexities associated with such a set of circumstances.
Whilst every effort has been made to ensure the accuracy of the information contained in this article, it has been provided for information purposes only and is not intended to constitute legal advice. Amorys Solicitors is a boutique commercial and private client law firm in Sandyford, Dublin 18, Ireland.
For further information and advice in relation to “Personal Injuries – The MIBI”, please contact Daragh Burke, partner, Amorys Solicitors, telephone 01 213 5940 or your usual contact at Amorys.

Conveyancing Clients’ Competition

Conveyancing Clients’ Competition

Become one of our next 50 conveyancing clients starting today (1st day of November 2020) (“entry date”) and have a chance to win a super cash prize of€750! Good luck to all participating clients!

Question: What do you have to do to enter the competition?

Answer: Comply with the entry criteria as follows:-

  1. Instruct Amorys to act on your behalf in the sale or purchase of a house, duplex or apartment.
  2. Complete the sale or purchase in the normal way.
  3. Discharge Amorys’ fees and outlay as agreed.
  4. Provide the correct answers to 3 questions which we will send to you by email after your sale/purchase has been completed. All entrants will be asked the same questions.
  5. Await the result of the competition.

Conditions and Additional Information

  • If your sale or purchase does not proceed for any reason, you will not be eligible to participate in the competition.
  • For the avoidance of doubt, there is only one prize of €750. Joint sellers/purchasers will have to share the spoils!
  • The draw amongst successful participants (i.e. everyone who satisfies the entry criteria) will take place 14 days subsequent to completion of the 50th new sale and purchase agreed with clients subsequent to the Entry Date. Your Entry Date will be the date you sign and return your Letter of Engagement to Amorys. For obvious reasons, we cannot give any commitment as to when the draw will take place.
  • The draw will be conducted by one of our solicitors who will randomly pick the name/s of the lucky winner from a box containing the name/s and contact details of all eligible participants. An independent observer will supervise the draw.
  • We will notify the winner by phone and email immediately subsequent to the draw.
  • The prize will be paid immediately by EFT to your bank account or by cheque as the winner may direct.
  • Our Letter of Engagement will contain an opt-out option for any client who does not wish to participate in the competition. All other clients will automatically be entered in the competition in the absence of ticking the opt-out option. By accepting the prize the winner/s grants Amorys the right to use and publish his/her name in such media as Amorys may choose (including but not limited to the internet) for advertising and promotional purposes without additional consideration.
  • A copy of our Data Protection Policy can be found here.
Amorys Solicitors is a boutique commercial and private client law firm in Sandyford, Dublin 18, Ireland.
For further information and advice in relation to “Conveyancing Clients’ Competition”, please contact Deirdre Farrell, partner, Amorys Solicitors, telephone 01 213 5940 or your usual contact at Amorys.

COVID-19 and Data Protection Rights

Data Protection Rights and the Pandemic COVID-19

It was recently reported that the HSE had disclosed to an employer that one of their employees had tested positive for Covid-19 prior to informing the employee of their own test results. The HSE explained in a statement that in “exceptional circumstances”, “if it is considered essential for the public health good”, they would inform an employer of a Covid-19 positive test result prior to informing the employee. The HSE has since requested guidance from the Data Protection Commissioner (DPC) and has suspended the practice in the interim. Nonetheless, the issue has provoked serious concerns regarding the protection of employees’ sensitive medical data and whether there are any “exceptional circumstances” wherein the data protection rights of data subjects can be overridden in such a way.

Guidance from the Data Protection Commissioner (DPC)

Mass Covid-19 screening has been taking place across a number of sectors including meat processing plants and nursing homes, and which involves the processing of large amounts of personal data including employee names, addresses and dates of birth and sensitive ‘special category’ medical data over a relatively short period of time and with a high degree of urgency.

The Data Protection Commissioner has issued advice regarding data protection law and the measures being taken by governments, employers in the public and private sector and voluntary bodies in the wake of the pandemic. Firstly, any protection measures implemented as a result of the pandemic that involves the processing of personal data need to be proportionate and necessary. The pandemic does not give organisations the authority to circumvent data protection standards and the applicable law.

  • If an organisation is acting on the advice or direction of public health authorities or other authorities, the processing of personal data and data relating to health is permitted under the GDPR and the Data Protection Act 2018, provided the relevant safeguards are in place to include the deletion of the data under strict time limits, limitations on who can access the data and ensuring that staff are adequately trained regarding the protection of the data rights of individuals.
  • Under the Safety Health and Welfare at Work Act 2005, employers are legally obliged to protect their employees. Personal health data can be processed if it decided it is necessary to do so and it is proportionate under the 2005 Act and the GDPR.  The data should be processed in a confidential manner meaning that if there is an employee who has tested positive for Covid-19, staff should be advised without identifying the particular employee.
  • Organisations must be transparent regarding how they process personal data and sensitive ‘special category’ personal data, why they are collecting this data and how long the data will be retained in plain and clear language.
  • Confidentiality must be maintained and the necessary safeguards put in place to ensure the security of the data. There must be a very strong justification for identifying any individual affected by Covid-19 to a third party or colleagues.
  • Only the minimum amount of data required to implement the objective of preventing or containing the spread of Covid-19 must be gathered and any decision-making process of an organisation regarding their response to the pandemic which involves the processing of personal data should be retained by the data processor.

While the pandemic has rapidly changed the way organisations are functioning, the fundamentals of data protection remain intact.  Organisations must exercise caution when processing personal data and in particular when the data is health-related.

Whilst every effort has been made to ensure the accuracy of the information contained in this article, it has been provided for information purposes only and is not intended to constitute legal advice. Amorys Solicitors is a boutique commercial and private client law firm in Sandyford, Dublin 18, Ireland.
For further information and advice in relation to “COVID-19 and Data Protection Rights”, please contact Daragh Burke, Amorys Solicitors, telephone 01 213 5940 or your usual contact at Amorys.

Pin It on Pinterest