New law to ensure furloughed employees receive full redundancy payments

Workers in Northern Ireland who are laid off while furloughed will receive redundancy pay based on their normal wage under new laws being brought in next month.

A spokesperson for the Department for the Economy (DfE) confirmed to Irish Legal News today that the changes being brought into effect in England, Scotland and Wales tomorrow will also be extended to Northern Ireland in “early August”.

Employees with more than two years’ continuous service who are made redundant are usually entitled to a statutory redundancy payment that is based on length of service, age and pay, up to a statutory maximum.

The new regulations aim to ensure that employees who are furloughed receive statutory redundancy pay based on their normal wages, rather than a reduced furlough rate.

The changes will also apply to statutory notice pay, which is where employees must be given a notice period before their employment ends, varying from at least one week’s notice up to 12 weeks’ notice, depending on how long they have worked for their employer. During this notice period, employees must be paid.

The spokesperson for the DfE said: “The law to ensure furloughed staff receive full redundancy payments will come into effect in England, Scotland and Wales on the 31 July. Northern Ireland regulations will come in to operation in early August.”

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