Redundancy legislation needs to be urgently reformed to meet the changing needs of workers in a more volatile economic situation, according to the general secretary of SIPTU, Mr John McDonnell.
He has called for statutory payments to be raised from a maximum of one week per year of service to at least three weeks.
Commenting yesterday on recent closures, he said the discrimination suffered by younger workers under the 1967 Redundancy Payments Act should be abolished. The Act went against the spirit of the 1998 Employment Equality Act, which outlawed discrimination on the basis of age.
At present redundant workers aged under 41 receive half a week's pay for each year of service, while those aged 41 or over receive a week's pay for each year of service. Mr McDonnell said the minimum compensation should be raised to three weeks' pay for each year of service, irrespective of age.
Following representations to the Tanaiste, Ms Harney, Mr McDonnell said workers at Irish Ispat would now receive £5,000 each from the EU Coal and Steel Social Fund on top of their statutory redundancy. The union is also in discussions with the Minister for Finance, Mr McCreevy, to access EC loans to Ispat now being held in an escrow account. These could add to the redundancy package.
Mr McDonnell said the refusal of Irish Ispat to provide more than statutory payments underlined the discriminatory effect of current legislation. "A worker aged 51 with 30 years' service will only receive £8,000 under the Act, compared with £12,000 for a 61-yearold worker with 30 years' service."
The reason is that 20 years of the service of someone aged 51 is calculated at half a week's pay per year while in the case of a 61-year-old the lower rate applies to only 10 years of service.
"The low amounts and differential bring into sharp focus the need for an urgent review of the present Redundancy Payments Act," he said. "SIPTU's labour law monitoring group is currently working to produce a set of recommendations, which would substantially raise the legal minimum payments under the Act."
A spokesman for the Equality Authority yesterday said section 17.4 of the Employment Equality Act specifically excluded the age-related provisions of the 1967 Redundancy Act from the grounds on which cases of discrimination could be taken.
Besides increasing the statutory payments for all redundant workers, the SIPTU group advocates reducing the qualifying period for redundancy payments from two years' service to one year. The ceiling for calculating lump-sum entitlements should be raised from £400 a week to £500 a week and index-linked for the future.
"We would urge the Government to take these recommendations on board and ensure workers in vulnerable industries get the minimum of protection," he said.