Can Employees Be Paid Less Than The Minimum Wage?
The National Minimum Wage Act, 2000 states that the NMW is €8.65 per hour, there are some exceptions to this.
Where employees are under the age of 18 or within the first 2 years after the date of their first employment over the age of 18, the rate is €6.06 per hour
In the first 2 years after the date of first employment over the age of 18, the rate is €6.92 per hour in the first year and €7.79 per hour in the second year
Or
Where a trainee is doing a course which complies with S.I. No. 99 of 2000 for the 1st one third of the period the rate is €6.49 per hour, the 2nd one third the rate is €6.92 per hour, and the 3rd one third the rate is €7.79 per hour.
S.I. No 99 of 2000 is the Statutory Instrument which forms part of the National Minimum Wage Act, 2000
For the protection of both employees and employers a Contract of Employment, which is now a legal requirement, should be given to each employee as this will state clearly what is expected of both sides and will minimise or hopefully prevent issues arising that lead to ill feeling or disputes in the workplace.
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Zero hours contracts and the difference between Ireland and the UK
There has been a lot of discussion in the UK surrounding Zero Hour Contracts, after it has been reported that more than 1,000,000 in the UK are working under zero hours contract, which is 750,000 more than the Government had estimated. Questions have been raised over whether or not these are the right types of contracts for staff? and is the Irish experience different.
In the UK an employer can ask an employee to make themselves available for a set amount of hours each week but if they cannot provide hours there is no issue from the employers point of view, however the Irish experience of zero hours contracts are somewhat different. The same basic principle remains where an employer asks an employee to make themselves available for a set amount of hours and the employer is under no obligation to provide work, however, under Section 18 of the Organisation of Working Time Act,1997, if an employer cannot provide the employee with the contracted hours they are required to pay the employee at least 25% of the contracted hours or 15 hours (whichever is less).
This is how the Irish experience differs from the UK, as there is no remuneration payable to the employee in the UK if the employer cannot provide them with the contracted hours.
When looking at whether or not these are the right types of contracts for employees, you must look at the overall context of each industry, in some cases this will work out in the employees favour to have this flexibility, yet in other cases there is no security in income or hours each week which can be difficulty for more established workers, who have responsibilities and bills to be mindful of.
Unlike the UK experience employers in Ireland would be advised to steer clear of zero hours contract unless necessary, the requirement for remuneration leave an employers hands tied in that where no work is available there is still a requirement to compensate the employee.
A useful alternative to a zero hours contract would be a Casual hours contract, where the hours can vary each week in accordance with business needs, however where no work is available it is essentially a case of temporary layoff for the employee.
New Funding for Irish Employers
The Government has developed a Microfinance Fund to assist start-up and growing enterprises across all sectors with 10 or less employees. Loans of €25,000 are available to companies considered to be commercially viable even though they may not meet the conventional risk criteria applied by commercial banks. Applicants will have to demonstrate that they have been refused credit by a commercial lending institution before their application is considered.
The new fund will generate €90 million in new lending to 5,500 micro enterprises which will support 7,700 new jobs. Borrowers will pay a commercial interest rate. For more information see www.microfinanceireland.ie.
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2013 SFA Awards
We told you in December how, much to our delight, we had been shortlisted as a finalist in the 2013 SFA Awards, “Innovator of the Year” category directly resulting from our innovation in software development. This was in no small part attributable to our new dynamic software, BrightPay and Bright Contracts.
The final winner of the category was Megazyme, who were also announced as the overall winner of the awards.
Megazyme is a biotechnology company which employs 34 people and is involved in the development of analytical test kits and reagents for the agricultural, food, wine, dairy and biotechnology industries.
We extend our congratulations and good wishes for their continued success.
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Abolishment of REAs - what it means for you
The declaration on the 9th of May that Registered Employment Agreements (REAs) were deemed to be unconstitutional should have come as no surprise, given that they were introduced in the Industrial Relations Act of 1946. It took the National Electrical Contractors of Ireland 5 years before their challenge to Part III of the 67 year old Act was upheld in the Supreme Court.
As a result of the court ruling, there is now no legal requirement for industries to adhere to a pension scheme and the collection of the Construction Industry Monitoring Agency (CIMA) and the Electrical Pensions and Conditions of Employment (EPACE) have been abolished, effective immediately.
Please contact your scheme provider for further details.
http://www.cwps.ie/news/default.aspx?iid=43
http://www.neci.ie/2013/06/update-after-rea-callopse/
Entitlement to pay for a Bank Holiday
Full-time workers have an immediate entitlement to benefit for public holidays and part-time workers have an entitlement to benefit when they have worked 40 hours in the previous 5 weeks.
There are nine public holidays in the year. These are New Year’s Day - St Patrick's Day - Easter Monday - First Monday in May - First Monday in June - First Monday in August - Last Monday in October - Christmas Day - St Stephen's Day. Good Friday is not a public holiday, therefore a day off is not a statutory entitlement.
When a person works on a Public Holiday, they are entitled to be paid for the day in accordance with their agreed rates. In addition, they also have an entitlement to benefit for each public holiday. This can be different for each public holiday and each employee depending on the individual's work pattern.
If the business is closed on the public holiday and an employee would normally be due to work then they get their normal day’s pay.
If the business is open and the employee works, they are entitled to either, paid time off or additional days pay. This additional day’s pay is what was paid for the normal daily hours last worked before the public holiday.
If an employee is not normally rostered to work then they will be entitled to one-fifth of their normal weekly wage or a paid day off within a month or an extra day’s annual leave as the employer may decide.
If someone ceases to be employed during the week before a public holiday, having worked the four weeks preceding that week, they are entitled to benefit in respect of that public holiday.
If a person is on temporary lay-off they are entitled to benefit for the public holidays that fall within the first thirteen weeks of layoff.
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REA agreements deemed unconstitutional
On May 9th 2013, the Supreme Court ruled that Part III of the 1946 Industrial Relations Action, which provided the legal basis for Registered Employment Agreements (REAs), is unconstitutional, having regard to the provisions of Article 15.2.1. of the Irish Constitution.
Collective Agreements are agreements concluded between an employer and worker representatives. Employers and workers in any sector or enterprise can agree minimum rates of pay and conditions of employment.
Up to this Supreme Court ruling, they could have the agreement registered with the Labour Court as a Registered Employment Agreement (REA).
REAs were legally binding to the employers and employees in the sector of employment to which the agreement applied.
The Minister for Jobs, Enterprise and Innovation had previously announced proposals to alter the system of REAs with changes to be introduced in line with other developments.
The ruling does not alter previously negotiated contracts and only applies to future contracts.
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Read more at www.irishtimes.com >
Parental Leave
The EU (Parental Leave) Regulations 2013 (S.I. 81 of 2013) came into operation on 8 March 2013, amending the Parental Leave Acts 1998 to 2006. The Regulations made the following key changes to parental leave rights in Ireland:
Parental Leave entitlement increased to 18 weeks
The Parental Leave Acts provide parents, adoptive parents and persons in loco parentis, who have the required continuous service with their employer with the right to take unpaid leave to care for their children. The leave may be taken as a continuous block, or, if the employer agrees, it may taken over a period of time. The new Regulations increase the parental leave entitlement from 14 to 18 working weeks.
Leave for child suffering from long-term illness
Normally, parental leave must be taken before the child reaches 8 years of age, but leave can be taken to care for older children in certain limited circumstances, such as when a child has a disability. In such cases parental leave can be taken up until the child reaches 16 years, or the disability ceases, whichever first occurs. The new Regulations now extend the scope of this provision to allow for leave to be taken in respect of a child with a long-term illness until that child reaches 16 years, or the illness ceases, whichever first occurs.
Transfer of parental leave between parents limited to 14 weeks
Each parent has a separate entitlement to parental leave in respect of each child and there is no general right to transfer parental leave from one parent to another. However, in cases where both parents are employed by the same employer, either parent is entitled, subject to the consent of the employer concerned, to transfer all or part of their parental leave to the other parent. However, the new Regulations specify that the right to transfer parental leave is limited to 14 of the 18 working weeks.
Right to request change to working hours or patterns
The new Regulations also provide a statutory entitlement for employees returning from parental leave to request a change in their working hours or patterns for a set period of time. The request must be made not later than 6 weeks before the commencement of the proposed set period. The employer must consider, but is not required to grant, the request. When considering the request, the employer must have regard to the needs of the employer and the employee. The employer must then, within 4 weeks of receipt of the request, either (a) inform the employee in writing that the request has been refused, or (b) if the request is accepted, arrange for the employer and employee to sign an agreement confirming the proposed changes with the date of commencement, and duration of the changed working arrangements set out.
Other Important Aspects
Other noteworthy factors in addition to those above and those set out in the updated handbook section are as follows:
Social insurance contributions
- The Minister for Social Protection has previously introduced Regulations to ensure preservation of social insurance (PRSI) records for employees who take parental leave. The employer must write to the Records Update Section of Department of Social Protection, detailing the weeks not worked, so that the employee can get credited PRSI contributions for this time. Information about credited contributions and parental leave is contained on the Department’s website www.welfare.ie
Annual leave and public holidays
- While on parental leave, an employee must be regarded for employment rights purposes as still working. This means that annual leave is accrued while on parental leave. If annual holidays fall due during parental leave, they may be taken at a later time. A public holiday that falls while an employee is on parental leave and on a day which they would normally be working is added to their entitlement.
Amount of parental leave
- Where an employee has more than one child, parental leave is limited to 18 weeks in a 12-month period. This can be longer if the company agrees and parents of twins or triplets can take more than 18 weeks of parental leave in a year.
- The 18 weeks per child may be taken in one continuous period or in 2 separate blocks of a minimum of 6 weeks. There must be a gap of at least 10 weeks between the 2 periods of parental leave per child. However, if the employer agrees the leave can be separated into periods of days or even hours.
Other elements
- Generally an employee must have been working for the employer for a year before being entitled to parental leave. However if a child is very near the age threshold and an employee has been working for an employer for more than three months but less than one year they are entitled to pro-rata parental leave i.e. one week's leave for every month of employment completed.
- If an employee changes job and has already used part of their parental leave allowance they can use the remainder after one year's employment with the new employer provided the child is still under the qualifying age.
- Apart from a refusal on the grounds on non-entitlement, an employer may also postpone the leave for up to 6 months. This must be done before the confirmation document is signed. If the confirmation document is already signed, the leave cannot be postponed without further written agreement. Grounds for such a postponement may include lack of cover or the fact that other employees are already on parental leave. Normally, only one postponement is allowed, but it may be postponed twice if the reason is seasonal variations in the volume of work.
- Parental leave is to be used only to take care of the child concerned. If the parental leave is taken and used for another purpose The company is entitled to cancel the leave.
- Employers must keep records of all parental leave taken by their employees. These records must include the period of employment of each employee and the dates and times of the leave taken. Employers must keep these records for 8 years. If an employer fails to keep records they may be liable to a fine of up to €2000.
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Changes to parental leave
The Minister for Justice, Equality and Defence Mr Alan Shatter, T.D., signed regulations extending parental leave from 14 weeks to 18 weeks on 8 March 2013. The changes give effect to EU Council Directive 2010/18/EU of 8 March 2010 which implements a revised Framework Agreement on parental leave concluded by the European Social Partners.
The Regulations also allow parents returning from back to work from parental leave to request a change in their working hours or pattern. Employers must consider such a request but are not required to grant it.
This new regulations apply to all children who currently qualify for parental leave – children under 8 years of age, or in the case of child with a disability or long term illness, under 16 years of age.
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EAT awards €17,000 for dismissal after refusal to sign new contract
The need for employers to be careful in amending employee contracts has been highlighted in a case recently before the Employment Appeals Tribunal where a dismissed employee was awarded €17,000 by the Tribunal which indicated that it accepted the evidence of the claimant; that she was dismissed due to the fact that she refused to sign a new contract of employment.
The claimant who worked mainly evening shifts, weekends and bank holidays indicated that when she arrived at work one day, she was informed that there were new contracts on a desk and that all staff were to sign them on that day. She indicated to her employer that she wished to speak to him about this, however he indicated that there was nothing to be talked about. Her main concern at that point was that she was losing her days off.
She indicated to the Tribunal that her employer told her that he would drive through the changes without changes and whether they were legal or illegal and that when other members of staff refused to sign the employer blamed the Claimant for this. She claimed that she was then excluded from management meetings, her hours of work were reduced and ultimately she was informed that her position was made redundant.
While the employer indicated that the dismissal was due to redundancy, the Tribunal did not accept that it was a Redundancy and awarded the Claimant €17,000 in damages for Unfair Dismissal as well as €820 under the Minimum Notice and Terms of Employment Acts.
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