During Connect’s biennial conference this past weekend, delegates received backing for a motion to campaign over the outdated ceiling on statutory redundancy payments. Union’s general secretary, Paddy Kavanagh, stated during the event in Athlone that the existing 20-year old cap on statutory redundancy payments is grossly misaligned with the state of wages today and needs serious adjustment to provide better support for those undergoing job losses.
This cap, now deeply rooted in the lives of workers experiencing job losses, defines statutory redundancy as the minimum payment given to qualifying employees who lose their jobs, equivalent to two weeks’ salary for each year of service plus another week’s pay. However, the weekly pay used to calculate redundancy is currently restricted at €600 per week. This figure was established back in 2004, even if the present law requires the Minister for Enterprise to take into consideration adjustments in average earnings recorded by the Central Statistics Office in different sectors during any payment review – a rule that hasn’t been applied in 20 years.
Conference delegate Terry Gregg, who proposed the motion, indicated that while the CSO data from 2004 showed the average industrial pay rate to be €645.62 weekly, the number would likely rise to €1,014.69 per week by the end of 2021. As he drew attention to the necessity of the motion, Gregg mentioned that the antiquated statutory redundancy pay calculation was failing to keep up with the standard industrial wage, detrimentally impacting workers who have lost their jobs due to redundancy. Hence, he urged the conference to support the motion, which will commit the union to advocate for the weekly redundancy cap to be elevated to €1,015. Connect provides representation to skilled workers in an extensive array of sectors.
“Redundancy scenarios often arise from the restructuring or streamlining of flourishing businesses aiming for enhanced revenue generation, rather than companies facing a downfall or challenging times,” asserted Mr. Kavanagh.
Asserting the union’s intention to fight stoically until the connection with the medium industrial pay was re-established, he signified his commitment to the issue.
The payment, however, has remained untouched for the past two decades as indicated in the recent response to an inquiry in the parliament from Labour TD Ged Nash. Despite this, Minister for Enterprise, Peter Burke showed no immediate intentions to raise the rate.
Mr. Burke stressed on the need to prudently evaluate several factors while considering a hike in the €600 threshold. He said, “We need to strike a fine balance between the employee’s right for a fair redundancy pay and the potential rise in expenses that could burden some businesses.” He further emphasized on the need to partake in discussions with other government departments, employer and employee representation groups, and all other concerned parties before making a decision.