The Government has been urged to do more to reduce the amount of time it takes to process redundancy payment rebates for businesses.
The Small Firms Association (SFA) said today that some firms are being told it will take up to 6 months to process rebates by the Department of Enterprise, Trade and Employment.
Under the Redundancy Payments Acts, employees with more than two years continuous service are entitled to a tax-free lump-sum payment on the termination of their employment due to redundancy of two weeks pay per year of service plus one bonus week. Employers can reclaim 60 per cent of this from the Social Insurance Fund, which is directly funded by employers’ PRSI contributions on an ongoing basis.
The SFA said that companies are experiencing serious cashflow difficulties due to the delay in processing rebates and warned of further job losses if the situation continues.
“whilst on the one hand Government is emphasising the need to support small businesses’ cashflow and putting rightful pressure on the banks; on the other hand, it itself is adding substantially to the problem by holding out on money it owes to small businesses for as long as 6 months," said the associaton's director Patricia Callan.
We want the Tánaiste to immediately commit to a target of 1 week processing time from receipt of the applications”, she added.
