Case study: Calculating redundancy payment
Linda started her current job on 1 February 1998. She was given notice of redundancy on 6 July 2005 and her job ended on 31 August 2005. She was laid off from 6 to 10 June 2005. Her gross weekly pay (that is, her weekly pay before tax and other deductions) was €800. Linda wants to know how much her redundancy payment will be.
Answer
The current ceiling on wages that count for redundancy purposes is €600 per week. Linda's total service is 7 years and 212 days. She had no breaks in her continuity of employment. However, the 5 days laid off in June 2005 will reduce her reckonable service to 7 years and 207 days. 207 days is 57% (56.71%) of a full year.
Allowing 2 weeks for each year of service and for part of a year on a pro-rata basis, Linda will be entitled to 16.14 weeks (2 weeks x 7.57 years = 15.14, plus a bonus week). This will give Linda a redundancy payment of 16.14 x €600 = €9,684.
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Related Documents
- Lay off, short-time working and redundancy
Employees who have in a lay-off or short-time working situation may be entitled to a redundancy payment. Find out more. - Worksheet on calculating your redundancy payment
Your redundancy lump sum is calculated according a certain formula based on your years of service in an employment. This worksheet is to help you work it out for yourself. - Case study: Redundancy payment and short-time working
An employee who had been working reduced hours for over a year was made redundant. This case study shows how the value of a redundancy payment can depend on certain circumstances.
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