1. Does an employer need a reason in order to lawfully terminate an employment relationship? If so, describe what reasons are lawful in your jurisdiction?
Under common law, an employer can terminate an employment relationship for no reason provided the employer terminates in accordance with the contract of employment, including giving notice. However, "no fault" dismissals carry certain risks. An employee could seek to restrain their dismissal by way of an injunction in particular circumstances, therefore legal advice should be obtained before terminating employment without cause.
Under statute, the dismissal of an employee is presumed to be unfair unless the employer can show substantial grounds justifying the dismissal. To bring a claim under the Unfair Dismissals Acts 1977-2015, an employee must normally have one year's continuous service, but there are limited exceptions to this qualification.
The following are considered fair reasons for dismissal:
- reasons relating to the capability, competence or qualifications of the employee
- reasons relating to the conduct of the employee
- an employee being unable to work or continue to work without the employer contravening its legal obligations
Certain dismissals are automatically unfair for any of the following reasons:
- membership or proposed membership of a trade union or engaging in trade union activities
- religious or political opinions
- legal proceedings against an employer where the employee is a party or witness
- race, colour, sexual orientation, age or membership of the Traveller community
- pregnancy, giving birth or breastfeeding or any matters connected with pregnancy or birth
- availing of rights under legislation to maternity leave, adoptive leave, paternity leave, carer's leave, parental leave or force majeure leave
- unfair selection for redundancy
- making a protected disclosure (i.e. whistle-blowing)
In addition to proving that there were fair reasons for dismissing an employee, an employer must also show that it followed fair procedures in effecting the dismissal and that it acted reasonably in all the circumstances.
An employee can try to restrain their dismissal by a statutory injunction if they can demonstrate substantial grounds to contend that their dismissal would not have occurred but for having made a protected disclosure.
In addition, dismissal based on any of the nine discriminatory grounds is unlawful under the Employment Equality Acts 1998-2015. These nine grounds are gender, civil status, family status, age, disability, religious belief, race, sexual orientation and membership of the Traveller community.
2. What, if any, additional considerations apply if large numbers of dismissals (redundancies) are planned?
Special rules apply to collective redundancies, which arise where during any period of 30 consecutive days, the number of employees being made redundant are:
- five employees where 21-49 are employed;
- five employees where 21-49 are employed;
- 10% of the employees where 100-299 are employed; or
- 30 employees where 300 or more are employed.
The employer is also required to provide certain prescribed information in writing to the Minister for Employment Affairs and Social Protection at the earliest opportunity and, in any event, at least 30 days before the first notice of dismissal is served.
The employer is also obliged to consult with the employees' representatives with a view to reaching agreement about avoiding the proposed redundancies, reducing the number of employees affected, mitigating their circumstances by redeploying or retaining and deciding the basis on which it will be selected for redundancy. Individual employee consultation is also advisable before implementing any redundancies.
Employees with more than two years' service are entitled to a statutory redundancy payment. This payment is calculated based on two weeks' pay for every year of service and one further week's pay, subject to a maximum weekly earnings limit of €600. The statutory redundancy payment is tax-free. In addition, employees may also be entitled to an enhanced redundancy payment based on implied or express terms in their contracts.
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The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.