by Anne Lyne March-30-2020 in Employment Law, COVID-19

A version of this article first appeared in the Business Post on 29 March 2020

In these challenging and unprecedented times, organisations are rightly concerned about staffing issues and how to keep things “business as usual” when things are far from normal. For the vast majority of businesses there is an immediate need to cut costs where demand has stalled and a review of staff headcount forms part of the decision-making process. At the same time, knee jerk reactions around staff can culturally be unwise when things “return to normal”. In considering how best to manage any workforce change there are options short of redundancy for a business to consider.

Do the contracts provide a right to (a) make pay cuts (b) lay off staff or (c) put staff on ‘short time’ (this is the term used where an employee works less than half of his/her contractual hours, so the employee can then claim some social welfare payments). It would not be usual for firms to have all of these clauses but depending on the sector or the time of recruitment there may be an element of contractual leeway. Having a contractual right to take any of these steps makes things simpler from a legal perspective, but of course there is always the human element to any steps of this kind.

If the contract does not provide for these actions, then any steps taken to place staff on lay off/short term should be by agreement.  In this climate employees are likely to agree, because the alternative for an employee is compulsory redundancy.

The following are a number of considerations that a business should think about in relation to its workforce, short of making people redundant:

  1. New Hires – immediately look at new hires. Have any offers been made, but not accepted?  Should any or all of these be withdrawn?
  2. New Hires – in terms of signed contracts, it is more difficult. A business could look to delay a start date, by agreement.  This could leave the person unemployed, yet unable to claim any State benefit.  The other option is that the person starts but is put on lay off immediately, so s/he can claim social welfare.  Ideally the layoff would be agreed. If not, an employee may look to recover the lost income at some stage.
  3. Current Employees - Each team should look at its requirements, and the business could look at re-deployment. Shift work becomes more feasible where employees are working from home and the standard hours do not apply.  Ideally the contract would allow for this.
  4. Short Time/Lay off- whether short-time/lay offs are an option, instead of redundancy.  This can be attractive given the employee will receive a social welfare payment.
  5. Parental leave or Carer’s Leave - An employer could ask employees who cannot work remotely due to family demands, if they want to consider a period of parental leave or carer’s leave. Carer’s leave is paid by the State but requires sign off by a doctor and a minimum period of 13 weeks and up to 2 years’ leave. It is unlikely that there would be much take up where staff are concerned about job loss, but it is something to consider.
  6. Annual Leave - Ask employees to take outstanding holidays. However keep in mind, that this may not be ideal for cash flow. There is an argument that a “holiday” at this time doesn’t meet the criteria for “rest and relaxation” provided for in the legislation, but in these uncertain times, it would seem unfair to an employer, looking to keep the doors open, to be successfully challenged on this point.

There are a number of income supports that are available from the Department of Employment Affairs and Social Protection during a COVID-19 (Coronavirus) related absence or temporary lay-off from work, as follows:

  • employees and the self-employed who have lost employment due to a downturn in economic activity caused by the COVID-19 pandemic.
  • workers who are not diagnosed with COVID-19 but who self-isolate
  • workers whose employers do not supplement/top-up the State Illness Benefit payment (COVID-19)
  • workers who are requested to stay at home by their employer (COVID-19)
  • workers who are laid off temporarily or put on to short time working (COVID-19)
  • workers who need to take time off work to care for a person affected by COVID-19 (Coronavirus)

You will find more information on each on the above in the “Income supports” section here.

For further information, please contact Anne Lyne alyne@hayes-solicitors.ie at Hayes solicitors. 

 

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About the Author

Anne Lyne
Anne Lyne

Anne is a partner in the Employment team at Hayes solicitors. She has considerable experience advising and representing employers and employees on all aspects of the employment relationship from pre-employment matters to termination.