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A lay off is a temporary suspension of employment. This means that the employee is not required to work or receive pay, but is still on the books of the company as an employee.
Jamaican employers can implement lay offs for reasons such as:
- Financial Downturn: If the company experiences financial difficulties, such as declining sales or revenue, and needs to reduce costs.
- Temporary Shortage of Work: If there is a temporary shortage of work due to unforeseen circumstances.
- Natural Disaster or Emergency: If the company is shut down due to a natural disaster or emergency beyond its control.
Lay Off Duration
Employers can lay off employees for a maximum of 120 days without having to pay them. Therefore, lay offs can be longer than 120 days, however, employees have the right to choose to be treated as redundant after 120 days and claim their redundancy payments.
Employees who wish to be made redundant should make this request via writing and the employer does have to honour this request. Please note that it is not automatic that after 120 days you are entitled to redundancy; you, the employee, must make this request in writing.
When requesting redundancy, employees should bear in mind the following:
- Some employers cannot afford to make redundancy payments at all, much less in one payment, therefore you may have to wait a while before you get your money or accept your money via monthly installments.
- Redundancy payments are based on your recent wages, so if you have been laid off without pay for 120 days, your redundancy payment could be significantly lower than you expected.
- According to the Employment (Termination & Redundancy Payments) Act, when making your request in writing for redundancy, you should include an “effective date” for the redundancy. This date will be considered the relevant date for the purposes of the law. This date should be one that falls between 14 and 60 days after sending the notice.
Laid Off vs Fired
Being fired generally implies a permanent termination of employment due to performance issues or violations of company policies.
On the other hand, a layoff is a temporary measure, and employees are often expected to return to work when the situation improves.
Lay Off vs Redundancy
A lay off is a temporary suspension of employment without pay, usually due to economic hardship or other temporary circumstances.
Redundancy is a permanent termination of employment due to a surplus of labour or other structural changes in the workplace.
Lay Off Pay
During a lay off, the employer is not obligated to pay the employee.
However, the employer may choose to do so at their discretion. If the employee receives some pay or works for limited periods during the lay off, they may still be considered laid off by law.
Lay Off Notice
Employers are not required to give notice for a lay off, unlike terminations which require specific notice periods depending on the length of service of the employee.
Lay Offs in Jamaica
While the prospect of a lay off can be unsettling, understanding your rights and the nuances of this scenario can empower you to navigate it effectively.
Remember, a layoff is not synonymous with termination; it’s a temporary measure, and you retain options.
Ensure that you check your employment contract and your collective labour agreement (if applicable) to note what was agreed to in terms of lay offs. If you are unionized, ensure that you speak to your representative.
By knowing your options and communicating clearly with your employer, you can ensure a smoother transition during this potentially challenging time.
