REDUNDANCY

Redundancy is an action taken by an employer to terminate one or more positions on his workforce on account that these particular positions are no longer needed.

What is Redundancy

Redundancy is an action taken by an employer to terminate one or more positions on his workforce on account that these particular positions are no longer needed.

Redundancy benefit falls under the purview of the Protection of Employment Act (Volume 12, Chapter 89:02 of the Revised Laws of Dominica). Although it is currently administered by the Dominica Social Security, it is not a Social Security benefit.

Redundancy Benefit

Redundancy benefit is payable to an employee who suffers loss of employment arising out of the introduction of new methods of work, whether by automation, mechanization, rationalization or reorganization due to shortage of work in accordance with the Protection of Employment Act. In order to qualify for Redundancy benefit, an employee must have been employed for at least 3 years and must be Covered by the Protection of Employment Act.

A claim for Redundancy benefit must be submitted in writing to the Director, DSS, within 6 weeks of the date that the employee was made Redundant.

A person submitting a claim for Redundancy benefit must submit a written letter containing the following:

  • His name and Social Security number
  • His date of commencement and termination of employment on account of Redundancy
  • Proof or evidence that he has been made redundant
  • Proof that he has applied for the benefit from his employer and that his employer has failed to pay.

Where the DSS pays the benefit directly to the Employee(s) the amount so paid remains a statutory debt to be repaid by the Employer.

On the other hand, an Employer who has paid Redundancy Benefits to his former Employees can submit a claim for a Rebate to the Director of the DSS.

The Redundancy Rebate represents an amount refundable to the employer in respect of the amount paid to his employee as Redundancy benefit. The amount currently paid by DSS, as Rebate is 10% of the amount payable as Redundancy benefit, or the amount paid by the employer, whichever is less.

A claim for Rebate must be submitted in writing to the Director of DSS within 6 months of the date that the employee was paid Redundancy benefit.

The claim shall stipulate the following:

  • The reason(s) why the employee(s) was made redundant
  • The dates of commencement and termination of the employee’s employment
  • How the employee’s Redundancy payment was calculated by the employer
  • Proof of the amount that has been paid to the employee(s)
  • Any other proof that the Director may require for determining the rights of the employee, or the amount of the rebate
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