Redundancy in Ireland: what employers and employees need to know

Redundancy in Ireland is about the job, not the person. A role can disappear for a real business reason, and the dismissal can still be unfair if the process behind it was skipped. That gap between a genuine redundancy and a fair one is where most disputes start. It’s also where employers lose cases they expected to win, and where employees miss rights they didn’t know they had.

This guide covers both sides: what counts as redundancy, what you’re owed, what a fair process looks like, the extra rules for larger job cuts and lay-offs, what to check before signing an exit agreement, and the deadlines that apply if something goes wrong. It reflects the law as of October 2026.

What counts as a genuine redundancy

A redundancy happens when your job no longer exists, you’re let go, and you aren’t replaced. Citizens Information groups the usual reasons into four:

• Financial difficulty: the business needs to cut costs, and that means fewer staff.
• Less work: the employer no longer needs your skills, or needs fewer people with them, sometimes because new technology has taken over the task.
• Reorganisation: the business carries on with fewer staff, or your particular job disappears.
• Closure: the business shuts or moves.

The burden of proof sits with the employer. They have to show a real redundancy situation existed, that you were fairly selected, and that fair procedures were followed.

Citizens Information lists the warning signs that a redundancy may not be genuine: new people hired to do similar work, a poor relationship with your employer, or being singled out and treated differently from colleagues. A WRC decision from 2025 found one “redundancy” was a sham used to cut wage costs, because lower-paid staff were being recruited to do the same work. The award was €34,435.

Timing matters too. You can’t be made redundant while on maternity leave, and dismissal for redundancy during carer’s leave is treated as unfair. Selection because of pregnancy is automatically unfair.

Statutory redundancy pay

If you have at least two years’ (104 weeks’) continuous service in insurable employment, you’re entitled to a tax-free lump sum: two weeks’ pay for each year of service, plus one extra week.

The catch is the cap. Weekly pay is capped at €600 for the calculation, which works out at €31,200 a year. The cap hasn’t moved since 1 January 2005, and in 2024 the Minister told the Dáil there were no immediate plans to raise it. Anyone earning more than €600 a week gets proportionately less than their real pay would suggest.

Service	Gross weekly pay	Weeks owed	Statutory lump sum
3 years	€500	7	€3,500
10 years	€800	21	€12,600
20 years	€1,000	41	€24,600

A few points people often miss:

• The statutory payment is the minimum. Many employers pay more as an ex gratia sum, which has its own tax rules (see severance agreements, below).
• There’s no upper age limit. Service after 66 counts.
• Continuity isn’t broken by statutory family leave, illness, agreed absence, holidays, lay-off, or a transfer of the business.
• If your employer is insolvent and can’t pay, you can claim the statutory amount from the Social Insurance Fund through the Department of Social Protection.
• Employers no longer get a rebate. The old 60% rebate was abolished, so older guides that mention it are out of date.

Redundancy pay doesn’t replace notice. Unless your contract gives more, statutory minimum notice depends on service:

Service	Minimum notice
13 weeks to 2 years	1 week
2 to 5 years	2 weeks
5 to 10 years	4 weeks
10 to 15 years	6 weeks
15 years or more	8 weeks

A fair process

A real business reason answers why a role is going. It doesn’t answer why this person was chosen.

Nor does it answer how they were treated. Irish law asks both questions, and an employer has to pass both.

Under section 6(3) of the Unfair Dismissals Act 1977, where other people in similar jobs weren’t let go, a selection is unfair if it was made for a reason that wouldn’t justify dismissal, or broke an agreed or customary redundancy procedure. Where no procedure is agreed, the employer must act fairly and reasonably.

In practice, the WRC looks for these stages:

“Last in, first out” isn’t a legal requirement. It binds only where it has been agreed or is the established custom in that workplace. Otherwise it’s one method among several.

Three WRC decisions that show where it goes wrong

The common thread: each employer had a genuine reason for cutting jobs and still lost. In the first case, the award reflected months out of work and a lower-paid new job, so it isn’t a typical figure.

Decision	What the WRC accepted	What went wrong	Award
ADJ-00054906, Sept 2026	Real financial difficulty and a genuine redundancy	No warning the role was at risk, no criteria shared, no chance to suggest alternatives; the payment was sent before the appeal ended, and the appeal was called a “tick box exercise”	€60,000
ADJ-00029059	A real sales downturn	No objective criteria; the consultation masked a decision already made	€3,4644 weeks’ net pay
Scoring-matrix case	A genuine redundancy, with a matrix built by an outside HR consultant	No fair scoring system; disciplinary record and “attitude” weren’t objective	€2,688despite no financial loss

Collective redundancies: the 30-day rule

When enough jobs go within any 30 consecutive days, the Protection of Employment Acts add a formal process on top of everything above. The rules apply to establishments with more than 20 employees, whatever their length of service.

Employees normally employed	Redundancies that trigger the rules
21 to 49	5 or more
50 to 99	10 or more
100 to 299	10% or more
300 or more	30 or more

Once the threshold is met, the employer must:

• consult employee representatives at the earliest opportunity, and at least 30 days before the first notice of dismissal, with a view to reaching agreement
• give the representatives the reasons, the numbers and categories affected, total headcount, any agency workers, the timing, the selection criteria, and how any payment above statutory will be calculated
• notify the Minister for Enterprise, Tourism and Employment in writing
• issue no redundancy notices while consultation is running, and dismiss no one until at least 30 days after the Minister has been notified

Since 1 July 2024, liquidators and other court-appointed “responsible persons” must follow the same rules when a business is insolvent. An employee can complain to the WRC for failure to consult, failure to provide information, or dismissal before the 30 days are up. Each breach can carry up to four weeks’ pay, so up to 12 weeks in total. Dismissing too early can also bring a fine of up to €250,000 on conviction.

Lay-off and short-time: when waiting turns into a claim

When work dries up, an employer can put staff on lay-off (no work and no pay, but the job still exists) or short-time (hours or pay cut to less than half the normal week). Both must be temporary, and the employer must give notice before they start. The law sets no minimum notice period for this.

If it goes on long enough, the employee can claim redundancy instead of waiting. Under section 12 of the Redundancy Payments Act 1967, that point is reached after:

• 4 or more consecutive weeks of lay-off, short-time, or a mix of both, or
• 6 or more weeks within 13, with no more than 3 of them in a row

The claim is made in writing as a notice of intention to claim (the WRC’s Form RP9 can be used). It must be served no later than four weeks after the lay-off or short-time ends.

The employer then has seven days to respond. They can accept the claim, or give a counter-notice promising at least 13 weeks’ unbroken work starting within four weeks. If they say nothing within seven days, the claim is treated as accepted (Citizens Information).

Two cautions before an employee acts. Claiming means leaving: you end your employment by giving notice, and you generally give up notice pay. And statutory redundancy still needs two years’ service. For employers, the risk runs the other way: a “temporary” lay-off that drags on can turn into a redundancy bill that wasn’t planned for.

Severance agreements: read what you’re giving up

Many redundancies end with an exit agreement: a payment above the statutory minimum in exchange for the employee signing away claims against the employer. The payment is usually a few lines. What’s given up can run much longer: unfair dismissal and discrimination claims, “all claims known or unknown”, confidentiality, no negative comments, and an agreed reference.

Irish law allows employment claims to be settled this way, but only with informed consent. In Hurley v Royal Yacht Club (1997), the court said the agreement should list the Acts being waived, or make clear they were considered, and the employee should be advised in writing to take advice. The High Court endorsed that approach in Sunday Newspapers v Kinsella (2008). That’s why most agreements tell you to see a solicitor.

It depends on the facts. Waivers have been struck down where the employee had no real chance to get advice. The WRC has also upheld an agreement signed without advice, where the employee understood every clause and could have refused it and taken statutory redundancy alone.

Tax depends on what each part of the package is:

Part of the package	Tax treatment
Statutory redundancy	Tax-free
Notice pay and holiday pay	Taxed as normal pay
Ex gratia payment	First €10,160 plus €765 per full year of service is tax-free (the basic exemption); higher reliefs may apply

Two higher reliefs can replace the basic exemption: the increased exemption (up to €10,000 more, reduced by any tax-free pension lump sum) and SCSB, which is based on average pay and years of service. Tax-free termination payments are capped at €200,000 over a lifetime (Revenue).

If the deadline to sign is tight, ask for time to get advice. Oak Legal reviews severance agreements for employees.

Deadlines and remedies

The clocks are short, and they run from the date of dismissal or the breach, not from when you find out your rights. Complaints go to the Workplace Relations Commission. If you want to know what happens once a complaint is lodged, see What actually happens at a WRC hearing.

Claim	Deadline	Extension	What the WRC can award
Unfair dismissal, including unfair selection for redundancy	6 months	To 12 months for reasonable cause	Up to 104 weeks’ pay (4 weeks if no financial loss), or reinstatement or re-engagement
Statutory redundancy payment	52 weeks	To 104 weeks	The statutory lump sum owed
Collective redundancy breaches	6 months	To 12 months for reasonable cause	Up to 4 weeks’ pay per breach
Appeal of a WRC decision to the Labour Court	42 days from the decision	Exceptional circumstances only	Decided by the Labour Court

Common myths

“If the job is really gone, the dismissal is fair.” Not on its own. Selection and process are judged separately, and employers with genuine business reasons still lose on process.

“Last in, first out is the law.” Only where it’s agreed or the established custom in that workplace.

“Being laid off means waiting until they call you back.” After four weeks in a row, or six in thirteen, you can serve notice and claim redundancy.

“No legal advice means the agreement doesn’t count.” It depends on the facts. Some agreements signed without advice have been upheld.

“Redundancy pay is based on my full salary.” Statutory pay is capped at €600 a week.

Two checklists

Every redundancy turns on its own facts, so get advice on your situation.