Lay-off, short-time working and redundancy

Introduction

Your employer may lay you off or reduce your working hours (put you on short-time) for a number of weeks. This can happen if there is a lack of work available or changes to the financial circumstances of the business.

The difference between a lay off and short-time can be confusing and you have different rights in each situation.

In short, a lay-off is when your employer tells you that they expect you to have no work for a temporary period and you will not be paid. If a lay-off goes on for certain period of time, you may be entitled to claim for redundancy.

On the other hand, short-time working is when your hours and pay are reduced due to a decrease in work.

For each situation, we explain your rights, your social welfare supports and tell you how to claim redundancy.

If your job has been affected by COVID-19, you can get more information about employment rights during the COVID-19 restrictions.

What is the difference between a lay off and short-time working?

Lay-off

You may be facing a lay-off if your employer:

  • Can't provide work for you
  • Believes this is a temporary situation
  • Gives you notification of the lay off before the work finishes

If you are laid off, while you may not be working, you are still an employee of the company. This means that, although, you are not being paid, you have rights.

Short-time working

Short-time working refers to a specific temporary situation where either:

  • Your weekly pay is less than half your normal weekly pay
  • The hours you work are reduced to less than half of your normal weekly working hours

Your employer must notify you of the reduction in hours or pay (or both) before short-time working starts.

What social welfare payments can I get during a lay-off or short-time working?

There are social welfare supports available, depending on your situation.

If you are laid off or are on short-time working, you may be entitled to Jobseeker’s Benefit or Jobseeker’s Allowance.

If you are getting Working Family Payment, this may be affected by the reduction in your working hours.

Your rights for short-time working and lay-off

You have rights and your employer must follow rules if they bring in temporary lay-offs or short-time working arrangements.

It must be in your contract or with your agreement

Your employer can lay you off or put you on short-time if:

  • It is in your contract of employment
  • It is custom and practice in your workplace

Otherwise, your employer will need your agreement to lay you off or put you on short-time. However, if you do not agree, you may be made redundant.

You can read more about your options if you do not agree in our page on being asked to reduce your pay or hours of work.

Employer must give you notice and keep you informed

Your employer should explain the reason for the lay-off or short-time working to you. They should keep you informed of the situation during the period of lay-off or short-time working.

Both a lay-off or short-time must be temporary situations and your employer must give you notice of this before they start. The law on lay-off and short-time does not set out any minimum period of notice you must get. Exceptional circumstances, such as the COVID-19 pandemic, are likely to justify a short notice period.

Employer must be fair and can’t discriminate when selecting employees

When selecting employees for lay-off or short-time working, employers should apply the same criteria for selection as for redundancy. The criteria should be reasonable and applied fairly.

For example, the custom and practice in the workplace may be last in, first out, or the contract of employment may set out criteria for selection.

Under employment equality law, the selection must not discriminate against employees on any of the following 9 grounds:

  • Gender
  • Civil status
  • Family status
  • Age
  • Disability
  • Religious belief
  • Race
  • Sexual orientation or
  • Membership of the Traveller community

You still receive public holiday benefit during lay-off or short-time

During lay-off or short-time working, you still are employed by your employer and your contract of employment remains valid. This means that you are entitled to benefit for any public holidays that occur during the first 13 weeks of lay-off.

Part-time employee must have worked at least 40 hours in the 5 weeks before the public holiday to receive this benefit.

You do not build up annual leave during lay-off, but you are entitled to take annual leave that you built up before being laid off.

Lay-off and reckonable service

To qualify for statutory redundancy, you must have 104 weeks of reckonable service with your employer. Reckonable service does not mean how many weeks you were employed for; it means how long you were actually in work doing the work. So reckonable service does not include holidays and periods you were absent through illness, career break or parental leave.

In this way, a period of lay-off is not reckonable service.

This means:

  • If you are laid off and you have less than 104 weeks of reckonable service, you do not qualify for statutory redundancy.
  • Your period on lay-off is not used to calculate your redundancy lump sum.

Laid off due to COVID-19?

Please see the table below to see what counts towards reckonable service.

What period IS counted towards reckonable service

The period you received …

What period IS NOT counted towards reckonable service

The period you received …

Temporary Wage Subsidy Scheme (TWSS) COVID-19 Pandemic Unemployment Payment (PUP)
Employment Wage Subsidy Scheme (EWSS) A jobseeker’s payment
Another social welfare payment

How to claim redundancy from your employer

The rules below were suspended temporarily during the COVID-19 emergency period. After 30 September 2021, you can claim redundancy and access redundancy payments in the usual way.

You can claim redundancy if you are on a lay-off or short-time working or a combination of both for either:

  • At least 4 consecutive weeks
  • 6 weeks within the last 13 weeks

You may be entitled to a redundancy payment provided that you qualify for redundancy.

When you claim for redundancy in a lay-off situation, you are stating that you believe that your employer cannot offer you work. And you want to be released from your contract, wish to receive your redundancy payment and want to look for new work.

A lay-off does not involve the termination of your contract of employment, whereas a redundancy does.

Step 1: Give your employer your written notice

You must give your written notice of your intention to claim redundancy payment in respect of the lay off-off or short- time. The best way to do this is by using Part B of form RP9 (pdf).

You do not have to give notice as soon as you have been laid off or kept on short-time. You can chose to wait longer. If the short-time or lay-off stops and you decide to claim redundancy payment, you must give notice within 4 weeks after the lay-off or short-time working ends. Once this deadline passes, you are no longer entitled to claim a payment in respect of the period of lay-off or short-time.

Step 2: Your employer responds or does not respond

Your employer has 7 days to either accept your claim or give you ‘counter notice’. If your employer does not give you counter notice, they are assumed to have accepted your claim.

Counter notice is when your employer tells you that there will be work for you to do that will:

  • Start in the next 4 weeks from the date of your claim
  • Last at least for 13 weeks without lay-off

It may be difficult for your employer to guarantee 13 weeks of unbroken work with the rapidly changing nature of the COVID- 19 pandemic.

How claiming redundancy affects your right to receive notice

You should note that if you claim redundancy, you have left your job voluntarily. Therefore, you lose any right to notice from your employer.

However, if you have been laid off and you are later made redundant by your employer, you keep your right to receive notice.

You can get more information in our frequently asked questions on redundancy.

What law covers claiming redundancy?

The Redundancy Payments Acts 1967-2014 covers redundancy rules.

Where to get more information

For more information on your employment rights, contact:

Workplace Relations Commission - Information and Customer Service

O'Brien Road
Carlow
R93 E920

Opening Hours: Mon. to Fri. 9.30am to 1pm, 2pm to 5pm
Tel: (059) 917 8990
Locall: 0818 80 80 90
Page edited: 2 December 2021