Minister for Enterprise, Tourism and Employment Peter Burke has today started part of the Protection of Employees (Employers’ Insolvency) (Amendment) Act 2026, which aims to strengthen protections for workers whose employers cease trading.
The Insolvency Payments Scheme protects workers’ pay-related entitlements if their employer becomes insolvent.
The “Deemed Insolvent Process” – a new process under the Insolvency Payments Scheme – was launched today.
It is designed to support workerss who are owed money by their former employer, where the employer ceased trading without formally entering liquidation, receivership or bankruptcy, and these debts fell due on or after 8 December 2024.
Under the new process, the worker will first have to seek payment from their former employer. If the employer does not pay after eight weeks, the employee can then apply under the Insolvency Payments Scheme. Employers will be notified of any Deemed Insolvent Process claims and will have four weeks to respond.
Detailed guides to help employees and employers navigate this new process have been made available on gov.ie.
Minister Peter Burke said the Deemed Insolvent Process is an important new protection for workers who find themselves in a very difficult position when their employer ceases trading without going through formal insolvency.
“Although not a common occurrence, affected employees now have a clear pathway to ensure they are paid their statutory entitlements including outstanding wages, holiday pay and sick pay,” Mr Burke said.
“I encourage anyone who thinks they might be eligible to go to gov.ie/deemedinsolvency where we have clear information about the Deemed Insolvent Process and how to apply,” he added.
Minister of State for Small Businesses, Retail and Employment Alan Dillon said the new process has been designed to be straightforward and accessible for employees, while also ensuring fairness.
He said that employers will have an opportunity to respond to claims, and robust safeguards are in place to protect public funds.
“Importantly, a determination of ‘deemed insolvency’ applies only for the purposes of accessing the Insolvency Payments Scheme and does not affect an employer’s legal status under company or bankruptcy law,” he noted.
Minister for Social Protection Dara Calleary said the new process will expand access to the Insolvency Payments Scheme, that will be administered by the Department to protect employees of employers who cease trading without entering into liquidation, receivership or bankruptcy.
“Officials from my Department have engaged with officials from the Department of Enterprise, Tourism and Employment regarding the measures to be implemented, which are reflected in these new legislative and operational changes,” he added.
