Employers Social Insurance Redundancy Rebate Abolished Jan 2013

In the last budget in December 2012, the employer rebate of statutory redundancy payments made to employees has been abolished completely. This means that from 1st January 2013, employers will no longer receive any rebate for employees who are made redundant after this date.

For employees made redundant prior to 2013, a 15% rebate applies. The employees last date of employment, which includes notice, will need to be prior to 2013 to qualify for this rebate. To make a claim for this rebate employers submit a form RP50 to the Redundancy Payments Section of the Department of Social Protection within 6 months of the date of termination of employment.

The Government has kept this deduction very quiet and they have managed to keep this change under the radar of many employers. The previous budget reduction from 60% rebate to 15% was significant and in one year it has gone from 60% rebate to zero.

Many employers used the rebate amount as a guideline and gave this figure back to employees as an exgratia payment. Many fear that this removal of a redundancy rebate will leave many employers unable to afford pay any statutory redundancy payment to employees and so they will need to seek the full payment from the Department of Social Welfare.

For further details and assistance on redundancy and outplacement services, please contact hr consultant Gillian@kala.ie in confidence or call 01 406 14 75.

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