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Feb 19

Posted by
Jennie Hussey

Employment (Miscellaneous Provisions) Act 2018

The Minister for Employment Affairs and Social Protection, Regina Doherty has confirmed the new Employment Bill, which has been in the pipeline now for a number of years, will come into force on the 4th March. The Bill is being introduced to ‘improve the security of working hours for employees on insecure contracts and those working variable hours’, common in (but not exclusive to) service industries such as hospitality, tourism and retail. These industries often rely on flexibility in the employment contract and therefore the introduction of this new Bill will require them to take note.

The new Act makes certain breaches a criminal offence; where the employer does not comply with the new obligations in the Bill to provide the required information within one month, can lead to criminal prosecution. Fines on conviction could be up to €5,000 or imprisonment of up to twelve months or both. Directors, managers, secretaries or other officers of a company can be individually liable, i.e. be prosecuted individually for offences.

  • In summary, the new Act will:
  • Prohibit the use of Zero Hour contracts, save for exceptional circumstances
  • Obligate employers to notify new employees of five core terms of employment in writing within five days of commencing employment
  • Create a new entitlement to ‘Banded Hours’ contracts
  • Provide for minimum payments to employees who are required to be available to work but are not actually called to work

The Act also introduces an anti-penalisation provision whereby an employer may not penalize an employee for exercising their rights under the 1994 Terms of Employment Act. An employee who is penalized can be awarded compensation of such amounts as the WRC considers just but will not exceed four weeks remuneration.

The new Act will bring significant changes for Irish employers and employees and according to Minister Regina Doherty; the Act is a “once-in-a-generation reform of our labour market.”


Please visit for more information on the new Employment Bill which has been in the pipeline now for a number of years and is to be enacted on 4th March 2019.


Related Articles:

What are "banded hours"?

How to avoid PAYE Modernisation mistakes

Back to Basics - Disciplinary Steps and Sanctions


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Posted in Bright Contracts News, Employment Update

Feb 19

Posted by
Jennie Hussey

What are “banded hours”?

The Employment Act 2018 creates a new right for employees whose employment contract does not accurately reflect the reality of the hours they work on a consistent basis. After a reference period of 12 months, employees will be able to request in writing to be placed in a band of hours that better reflect their average weekly hours worked. In response, employers are obliged to place the employee in the appropriate band and should do so within four weeks of receiving the employee’s request.

The appropriate band is determined by the employer on the basis of the average number of hours worked by the employee per week during the reference period.

The appropriate bands are laid down in law as set out in the below table.

   Band A:       3 to 6 hours   
   Band B:       6 to 11 hours   
   Band C:       11 to 16 hours   
   Band D:       16 to 21 hours   
   Band E:       21 to 26 hours   
   Band F:       26 to 31 hours   
   Band G:       31 to 36 hours   
   Band H:       over 36 hours   

An employer may refuse to place an employee in a band in one of the following circumstances:

  • Where there is no evidence to support the employee’s claim
  • Where there have been significant adverse changes to the business during or after the reference period
  • Due to exceptional circumstances, an emergency or unforeseeable circumstances beyond the employer’s control
  • Where the average hours worked by the employee were affected by a temporary situation that no longer exists

In determining the 12 month reference period, a continuous period of employment immediately before the legislation is to be enacted on 4th March 2019 will be reckonable towards the 12 month reference period. Please visit for more information on the new Employment Bill which has been in the pipeline now for a number of years.

The Bill is being introduced to ‘improve the security of working hours for employees on insecure contracts and those working variable hours’, common in (but not exclusive to) service industries such as hospitality, tourism and retail. These industries often rely on flexibility in the employment contract and therefore the introduction of this new Bill will require them to take note.

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Posted in Employment Contract, Employment Update

Sep 18

Posted by
Jennie Hussey

Data Protection complaints increase since introduction of GDPR

Nearly 4 months since the General data Protection Regulation (GDPR) was introduced across all of Europe, complaints around Data Protection have nearly doubled in the UK and are up by nearly 2 thirds in Ireland.

GDPR was designed to give Data Subjects more control over their personal data, with more transparency and the threat of larger fines to those in breach of the new rules. The GDPR requires any company that suffers a data breach to notify its users/data subjects within 72 hours of the breach being discovered.

• Ireland’s Data Protection Commission (DPC), head of communications - Graham Doyle has said that ‘there has been a significant increase in the volumes of both breaches and complaints to the DPC since May 25th.’ Since GDPR enforcement began the DPC has seen monthly data breach reports double, while data protection complaints increased by 65%.

• Data protection complaints to the UK’s Information Commissioners Office (ICO) rose to 4214 in July compared to just 2310 complaints received in May before the GDPR came into force. A spokes person for the ICO said the increase was expected, as more users became aware of data protection because of publicity around the new rules and following a series of high-profile data scandals involving big technology firms.

Experts note, however that the increase does not mean that the number of data breaches has suddenly gone up, but rather reflects the full scale of the data breach problem becoming better known.
Organisations that fail to comply with GDPR can face fines of up to 4% of annual global revenue or €20 million, whichever is greater. So far none of the EU’s Data Protection Agency’s has issued any fines. Graham Doyle at the DPC said ‘It is too soon to expect to see any fines levied against organizations that have violated GDPR – given its only 3 months after it went into full effect.’


We will be hosting a free online webinar - ‘GDPR 3 Months On’ on Thursday September 20th at 11am, where Graham Doyle will joining us as a guest speaker.

To register for this webinar please click here.

Posted in Company handbook, Employee Contracts, Employee Self Service, Employment Update, Events, GDPR, General Data Protection Regulation

Nov 17

Posted by
Lauren Conway

€7,500 awarded for unfair interview questions

The Workplace Relations Commission has awarded €7,500 to a woman they found was discriminated against during a job interview with Minister of State for Training, Skills, Innovation, Research John Halligan. Mr. Halligan, during the course of the interview, said to the woman “I shouldn’t be asking you this, but....are you a married woman? Do you have children? How old are your children?”

Mr. Halligan said that the questions were asked in good faith as he wanted to make her aware that flexible working hours to allow his staff to take care of their families is something that he encourages. The WRC however, found that the questions were discriminatory under the Employment Equality Acts 1998-2005.

The legislation defines discrimination as treating one person in a less favourable way than another based on any of the following 9 grounds:

  • Gender
  • Civil Status
  • Family Status
  • Sexual Orientation
  • Religion
  • Age
  • Disability
  • Race
  • Membership of the Traveller community

When conducting an interview it is important for employers to build rapport with the candidate but they also need aware that asking questions or making comments in relation to the above 9 grounds will leave you at risk of a hefty discriminatory claim, even if you think you are just making small talk.

So what questions are appropriate and inappropriate to ask in a job interview?

Appropriate Interview Questions

  • Are you able to perform the specific duties of this position?
  • What days can you work? What hours can you work?
  • Are you available to work overtime on occasion?
  • Are you available to travel on occasion?
  • Are you able to start work at 8 am?
  • What are your long-term career goals?
  • Do you have any responsibilities that would interfere with traveling for us?

Inappropriate Interview Questions

  • Do you have or plan to have children?
  • If you get pregnant, will you continue to work, and will you come back after maternity leave?
  • What are your child care arrangements?
  • Are you married /engage?
  • How many children do you have? Do you have a babysitter available if we need you on a weekend? Do the working hours fit with your childcare?
  • Do you have a baby or small child at home?

Employment and equality legislation doesn’t just start once you hire someone, it’s applicable the moment you post a job advert. With this in mind employers need to be mindful of what they say even when making small talk and building rapport with candidates before and after the job interview. 

To view our full Interviewing Guidelines click here

Also see our blog ‘Be careful of discrimination in job interviews’ here

To book a free online demo of Bright Contracts click here
To download your free trial of Bright Contracts click here

Posted in Discrimination, Employment Update, Workplace Relations Commission, WRC

Sep 17

Posted by
Lauren Conway

What to be aware of when completing a reference check

As an employer, there will undoubtedly come a time that you will be asked to provide a reference check for a previous employee to their potential new employer. If you have a standout employee with plenty of praise for them, then providing their reference check may seem like a doddle, but if you have an employee that parted on bad terms the reference check can be less than straightforward.

Why you should be careful completing a reference check

You have a duty of care to provide a truthful reference check to potential employers – but this may come at a price. Be aware that you run the risk of being sued for defamation if a negative reference that was given cannot be verified. A new employer can also claim against you if an employee who you gave a great reference for turns out to be less than satisfactory.

What can you do to protect yourself?

• You are under no obligation to provide a reference check for employees. If you wish to refrain from providing reference checks you may include a policy in your staff handbook stating this.

• If you are willing to provide reference checks you may adopt a policy to keep it brief and only divulge factual information, including:

- Dates of employment
- Job title
- Relationship to the candidate
- Final Salary

• If you are happy to provide a full reference check for an employee and answer behavioral questions regarding their work ethic, attitude, timekeeping etc. ensure that all the information you provide is factual and true.

When you adopt a reference check policy that best fits your business, the key then is to be consistent. What you do for one employee you must do for all. Inconsistency could leave you wide open to a discrimination claim from a disgruntled employee. Be sure to include the policy in your staff handbook and make all employees aware of it.

Also, see…Top Tips for Reference Check Questions

Posted in Company handbook, Contract of employment, Employee Contracts, Employee Handbook, Employment Contract, Employment Update, SME, Staff Handbook

Jul 16

Posted by
Laura Murphy

7 Employment Myths

We've clarified the truth on some of the most common employment law myths.

Myth 1: No employment contract exists if there is nothing in writing or signed.

Fact: Even verbal agreements are binding. An employment contract exists from the moment a job offer is accepted. Legally, an employer should within two months of an employee starting work, issue a written statement of terms and conditions of employment. Even if this document has never been issued a binding employment contract still exists. The written statement does not have to be signed so if an employer issues one but the employee does not sign it, the employer and the employee are still bound by the terms stated in it.

Myth 2: Holidays start to accrue once the probationary period is successfully completed.

Fact: Holidays start to accrue from the first day an employee is employed. The existence of a probationary period will not affect a new employee's length of service or statutory employment rights.

Myth 3: Employees can say when they take their holidays.

Fact: Employees requests for annual leave can be refused by an employer for business reasons. However, when considering leave requests employers should also bear in mind the employees family responsibilities and entitlement to rest periods. Based on business needs employers can specify certain periods where annual leave can or cannot be taken. Employers should consult with employees at least one month before any holidays are due to commence.

Employers are advised to agree with employees how and when employees should give notice of annual leave. But in the absence of any agreement it is recommended that the notice period should be at least twice the period of leave to be taken. So for example if a weeks’ leave is requested then two weeks’ notice should be given.

Myth 4: Employees on long-term sick leave should be left alone.

Fact: Although employers should not put undue pressure on employees who are on long-term sick leave, they are entitled to find out more information about the illness with the aim of establishing when and how the employee could return to work. This would include consultation with the employee and, with permission, writing to the employee's GP (and any specialist) to find out about the employee's condition, the prognosis and whether there is anything the employer can do to help facilitate their return (such as reduced hours).

Myth 5: If an employee is on maternity leave it’s illegal for an employer to contact her about any work-related issues.

Fact: Employers can and should keep in contact with employees on maternity leave. It’s good practice to agree beforehand how this contact should take place and to be sensitive to an employee’s circumstances and preferences. You could agree when is best to telephone, write letters or email employees about workplace developments.

Myth 6: An employee’s continuous service resets after moving roles within a company.

Fact: Moving roles within the same company does not ‘reset’ an employee’s continuous service. Although after the move the employee may be in probation, this does not mean that their previous service for the same employer can be discounted.

Myth 7: A worker cannot be accompanied by a trade union representative at formal meetings unless the employer recognises the union.

Fact: Workers have a statutory right to be accompanied at formal discipline and grievance hearings by a trade union official, and there are no requirements regarding whether the specific union has been recognised by the employer or not. Alternatively, a worker can be accompanied by a colleague.

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Oct 15

Posted by
Sean McHugh

Workplace Relations Act 2015

Major changes in the manner employment disputes and complaints are dealt with as well as new procedures for ensuring compliance with employment law come into force on October 1st 2015. The newly enacted Workplace Relations Act 2015 provides for a range of changes to the bodies and the procedures which deal with the: 

- Resolution, mediation and adjudication of industrial disputes and
- Resolution of complaints about breaches of employment legislation

The New System

The Workplace Relations Act 2015 provides that there will be two bodies dealing with complaints and disputes in relation to industrial relations and employment law. These are the Workplace Relations Commission (WRC) and the Labour Court.

The Labour Relations Commission is being abolished and all its functions transferred to the WRC. The functions of the Equality Tribunal, including functions under the Equal Status Act, are also being transferred to the WRC.

The Employment Appeals Tribunal (EAT) is being abolished. Its functions in relation to claims for redress, disputes or complaints are being transferred to the WRC. Its functions in relation to appeals are being transferred to the Labour Court.

It should be noted that he EAT will continue to operate until it deals with the cases that are before it when this Act comes into effect. It will then be dissolved. The EAT currently has approximately 3,500 cases outstanding. The average waiting time for a hearing before the EAT is currently 63 weeks. In some areas it is significantly longer.

The Labour Court will continue in existence with a number of existing and additional functions. The current members will remain in place. In future, appointments as chair and deputy chairs will be by public competition. When vacancies arise for ordinary members, trade union and employer organisations will nominate three candidates and the Minister for Jobs, Enterprise and Innovation will choose one.

The Workplace Relations Commission

The WRC will have a representative board consisting of a chairperson and eight other members.

The main functions of the WRC are to:

- Promote the improvement of workplace relations, and maintenance of good workplace relations
- Promote and encourage compliance with the relevant laws
- Provide guidance in relation to compliance with codes of practice
- Conduct reviews of, and monitor developments as respects, workplace relations
- Conduct or commission relevant research and provide advice, information and the findings of research to Joint Labour Committees and Joint Industrial Councils
- Advise the Minister for Jobs, Enterprise and Innovation in relation to the application of, and compliance with, relevant laws
- Provide information to the public in relation to employment laws other than the Employment Equality Act

The WRC may also provide advice on any matter relating to workplace relations to employers, their representative bodies and to employees, trade unions or other representative bodies of employees.

The WRC also has specific functions in relation to the resolution of industrial disputes and the implementation of employment laws. It will be the body to which all industrial relations disputes and all disputes and complaints about employment laws will be presented.

Mediation and Adjudication

The WRC will employ Mediation and Adjudication Officers to deal with industrial disputes and complaints about non-compliance with employment laws.

Mediation officers

Complaints and disputes will initially be presented in writing to the Director General of the WRC. The Director General may refer the complaint or dispute to a mediation officer if it is considered that the complaint or dispute is capable of being resolved without being referred to an adjudication officer and if neither of the parties objects to it being dealt with in this way.

Mediation is conducted in private. If agreement is reached as a result of the mediation, that agreement is legally binding on the parties.


If mediation is not used or is not successful, the complaint or dispute is referred to an Adjudication Officer. The current Rights Commissioners and equality officers will be Adjudication Afficers. A further 19 adjudication officers are being appointed. References in existing legislation to a Rights Commissioner now refer to an adjudication officer.

If the dispute or complaint is referred to an Adjudication Officer, the adjudication officer then generally conducts an inquiry. The Adjudication oOficer may dismiss a complaint or dispute if it is considered to be frivolous or vexatious. Such a decision may be appealed to the Labour Court within 42 days.

The Director General may decide to deal with the complaint or dispute by written submissions only, unless either party objects to this within 42 days of being informed.

At the inquiry, the parties have an opportunity to be heard and to present any relevant evidence. Hearings by an adjudication officer will be in private. Up to now hearings by Rights Commissioners have been held in private but EAT hearings have been in public.

Complainants may be accompanied and represented at hearings before an adjudication officer by a specified or permitted representative.

The adjudication officer then makes a decision in accordance with the relevant law and gives that decision in writing to the parties.

Decisions by adjudication officers will be published on the internet without identifying the parties.

Time limits

In general, the time limit of six months, extendable in certain circumstances remains unchanged. There are specific provisions about when the time limits begin to run in cases of disputes about adoptive leave, maternity leave, parental leave and carer’s leave.

Enforcement of decision of adjudication officer

The employer has 56 days in which to carry out the decision of the adjudication officer. If the employer fails to do so an application can be made to the District Court for an order directing the employer to do so. In general, the District Court must make the order. If the decision was to reinstate or re-engage the employee, the District Court may substitute an order to pay compensation of up to 104 weeks’ pay calculated in accordance with the rules under the Unfair Dismissals Act 1977 to 2007.

In all cases involving compensation, the District Court may also order interest to be paid.

It is an offence to fail to comply with an order directing an employer to pay such compensation to an employee unless the employer can show, on the balance of probabilities that they were unable to comply with the order due to financial circumstances.

Appeal to Labour Court from decision of adjudication officer

Appeals against decisions of adjudications officers may be made to the Labour Court. Such appeals must generally be made within 42 days but this can be extended if the Labour Court is satisfied that there were exceptional circumstances causing the delay.

The Labour Court may decide to deal with the complaint or dispute by written submissions only, unless either party objects to this within 42 days of being informed.

Labour Court hearings on appeals are in public unless the Labour Court decides that they should be in private (or partly in private) because of special circumstances. Parties are entitled to be represented at Labour Court hearings in the same way as at hearings before an adjudication officer.

The Labour Court has wide powers to require witnesses to attend and to take evidence on oath.

The Labour Court may refer a question of law arising in the appeal to the High Court. The High Court’s determination is final and conclusive.

Either party may appeal the decision of the Labour Court to the High Court on a point of law. Such an appeal must be made within 42 days. The decision of the High Court is final and conclusive.

Enforcement of Labour Court Decisions

An employer has 42 days to implement the Labour Court’s decision. If the employer fails to do so, the employee, the WRC, the employee’s trade union or excepted body may apply to the District Court for an order directing the employer to do so. The District Court must grant the order. In cases where compensation is to be paid, the District Court may also order the payment of interest. It is an offence to fail to comply with an order directing an employer to pay such compensation to an employee unless the employer can show, on the balance of probabilities, that they were unable to comply with the order due to financial circumstances.

Enforcement of employment legislation

The authorised officers and inspectors who are currently employed by the National Employment Rights Authority will continue to have a similar role with the WRC. New arrangements for prosecutions and new compliance measures are introduced by the 2015 Act.

Inspectors have extensive powers to collect documentary and personal evidence in relation to alleged breaches of workplace legislation. This includes the power to enter premises, see and/or remove documents and interview people. If necessary, inspectors may be accompanied by other inspectors or members of An Garda Síochána. They may apply to the District Court for search warrants. Their powers under the various employment laws are restated and consolidated in the Workplace Relations Act 2015.


The Minister for Jobs, Enterprise and Innovation has the power under a number of employment laws to bring summary prosecutions against employers who are alleged to be in breach of the law concerned. These powers are being transferred to the WRC. The Act provides that, in most cases, the employer will be liable for all legal costs.

Compliance Notices

The Act provides a new process for the serving of compliance notices. An inspector may serve a compliance notice on an employer if satisfied that a contravention of the relevant legislation has occurred. This notice specifies how that contravention is to be rectified. An employer may appeal against the compliance notice to the Labour Court within 42 days. There is a further appeal from the decision of the Labour Court to the Circuit Court. It is an offence for an employer to fail to comply with a compliance notice.

The existence of a compliance notice or any dispute about it does not prevent employees from taking action in relation to any alleged breach of employment law in respect of them. Neither does it prevent any prosecution for an offence under employment laws.

Compliance notices may be used in relation to breaches of the following legislation:
- Notice to employees of procedure for and grounds for dismissal under the Unfair Dismissals Act 1977 to 2007
- Regulation of certain deductions made and payments received by employers under the Payment of Wages Act 1991
- Leave on health and safety grounds under the Maternity Protection Acts 1994 and 2004
- Requirement to give an employee a written statement of terms of employment and requirement to give written notice of changes to those terms under the Terms of Employment (Information) Acts 1994 to 2014
- A range of possible breaches of the Organisation of Working Time Act 1997 including those in relation to rest periods, Sunday work, working hours, information on working time, zero hours contracts and holidays
- Protection of employment rights under the Carer’s Leave Act 2001
- Obligation of hirers to agency workers under the Protection of Employees (Temporary Agency Work) Act 2012

Fixed payment notices

The Act provides for using fixed payment notices for certain offences. This is a new development which may well be expanded in future. Inspectors may issue fixed payment notices for amounts up to €2,000 where they have reasonable cause to believe that a person has committed a relevant offence. The fine must be paid within 42 days. The relevant offences are:
- Breaches of the obligation on employers to consult representatives of employees and to provide information to them under the Protection of Employment Act 1977 (collective redundancies)
- Failure to provide statement of wages and deductions from wages under the Payment of Wages Act 1991, or
- Failure to provide employee with statement of average hourly rate of pay for pay reference period under the National Minimum Wage Act 2000

General Powers of the WRC

The WRC inspectors and adjudication officers have various powers to get information from employers and employees and to provide that information to other official bodies. For example, they may:
- Require employers to disclose their registration number and employees to provide their PPSN and to disclose these numbers to official bodies for the purposes of investigating or prosecuting alleged offences under employment law
- Disclose information to public contracting authorities that a person with whom that authority has entered into a contract (either a primary contractor or a party to a secondary contract) has been in breach of employment legislation and may require such an authority to disclose similar information to them

The WRC may make arrangements with other official bodies to facilitate administrative co-operation.

It may also enter arrangements with foreign statutory bodies for the exchange of information relevant to its functions and for the provision of mutual assistance.

Codes of practice

The WRC may prepare codes of conduct for the guidance of employers, employees and others affected by employment laws. It does not have this function in relation to the Employment Equality Act 1998; codes of practice in relation to that Act are the responsibility of the Irish Human Rights and Equality Commission.


The Act allows for the charging of fees for services provided by the WRC and the Labour Court. The Minister has said that it is not the intention to introduce such fees in general. However, it is intended to introduce a fee of €300 for an appeal to the Labour Court where the party who is appealing had not turned up to a hearing at the WRC.

Changes to specific laws

Virtually all employment laws are changed to some extent by this Act because the enforcement procedures are changed. There are some other specific changes that relate to the Unfair Dismissals Acts, the Employment Equality Act, the Equal Status Act, and the Organisation of Working Time Act.


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Posted in Employment Update

Sep 15

Posted by
Denise Cowley

How employers pass on tips, gratuities and service charges to their employees

The Call for Evidence will look at how restaurants treat tips left by customers and whether government intervention is necessary to strengthen the voluntary code of practice run by the industry.

The inquiry will seek information and views from the hospitality industry and other key stakeholders and will consider whether there should be a cap on the proportion of tips restaurants can withhold from staff for administrative costs and, if so, what this level should be.

Research from 2009 found that one in five restaurants did not pass tips to their staff, yet the vast majority of customers said they wanted the waiting staff to receive tips left for them. More than three quarters wanted to clearly see the restaurant’s tipping policy displayed clearly.

While there is a voluntary code of practice which is overseen by industry body the British Hospitality Association, restaurants may currently choose to ignore its 4 principles of transparency and adopt various tipping practices.

The Call for evidence has been launched by the Department of Business, Innovation & Skills (BIS) and will run until 10th November 2015.

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Posted in Company handbook, Employment Contract, Employment Update

Jun 14

Posted by
Laura Murphy

Changes to Holiday Pay Calculations

As we enter the summer holiday season employers need to ensure that they are paying their employees correctly during annual leave.

A recent decision by the European Court of Justice (ECJ) will impact how some annual leave pay is calculated.
Do you pay employee’s commission? Is the commission calculated based on the amount of sales made or actual work carried out? If yes, according to the ECJ, holiday pay should include commission pay.

The decision was made in the case of Locke v British Gas Trading and Others. Locke was a Sales Representative whose commission made up approximately 60% of his remuneration. After taking two weeks leave in 2011, Locke suffered financially as he was unable to generate sales for the period he was on annual leave.

The ECJ ruled that the purpose of annual leave is to allow a worker to enjoy a period of rest and relaxation with sufficient pay. By not including commission payments with holiday pay, employees are less likely to take annual leave so as to avoid financial hardship.

It has been left to the national courts to determine how to calculate the commission to which a worker is entitled, however the court did suggest that taking an average amount of commission earned over a certain period, e.g. the previous 12 months.

Employers are advised to review their commission policies to establish which, if any, payments need to be included in annual leave pay.

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Posted in Annual Leave, Contract of employment, Employment Update, Pay/Wage

Oct 13

Posted by
Laura Murphy

What will the budget changes to Illness Benefit mean to Employers?

There have been mixed opinions on Budget 2014. Relief that tax rates have not been increased. Anger at cuts to pensioners and maternity benefits. But how will Budget 2014 affect employers?

An unexpected announcement made in the Budget and one that has been relatively unreported in the media was the rise of waiting days for Illness Benefit from after 3 days leave to after 6 days leave. Despite the lack of media attention this is not something employers can ignore!

The effect of sick leave on employers

Sick leave already has a significant negative effect on Irish businesses. According to IBEC’s 2011 Guide to Managing Absence over 11 million working days are lost in Ireland every year due to sickness, costing businesses €1.5 billion or €818 per employee. The report also found that on average employees missed 5.98 days per year.

Impact of the illness benefit change to employers

No matter how you approach sick leave and sick pay in your company this budget change is very likely to have a negative impact on your business:

A.      If, as an employer, you pay company sick pay in addition to illness benefit, you will be facing increased costs.

For Example: An employee earns 300 per week and is off sick for 1 week*[i]:


Company Sick Pay for the 1 week

Illness Benefit recouped by Employer

Actual Cost to Employer





As per Budget 2014




Additional Cost to Employer



Employers need to review sickness absence and sickness pay policies in their contracts of employment and staff handbooks. They need to consider:

  • Do the policies specifically refer to the illness benefit received from the State? Do the terms need to be changed?
  • Can the company afford the additional cost to their sick pay scheme? Is this something that needs to be amended?
B.      If as an employer, you do not pay sick pay in addition to illness benefit you may also want to review your policies and procedures. Will employees be forced to come into work when they are genuinely unwell because they cannot afford to take time off? Will this result in greater spread of illnesses across the company, further affecting workplace productivity and the cost to the business.

How can companies minimise the impact of sickness absences and the change to illness benefit?

Companies looking to minimise the impact of this budget change, and minimise the cost of sick leave in general, need to look at reducing sick leave levels in the workplace. Prevention is better than cure. Key to reducing sick leave will be to have effective sick leave policies and procedures in place. A sick leave policy will clearly set out the procedures that should be followed by both employees and management in cases of absence through illness. Implementing certain steps, such as having to speak to a manager to report your absence, or back to work interviews are proven to significantly reduce unnecessary sick leave absences. According to the CIPD’s 2013 Absence Management Survey, introducing a new sick leave policy was the top solution implemented by companies to manage short-term absences, with 63% of respondents having updated/implemented a policy.                               

By reducing the level of unnecessary sickness absence employers will be better placed to support those employees who are genuinely ill and who cannot and should not attend work, whether illness benefit applies or not. 

[i] The below assumptions have been made in the example above:
  • Employee normally works 5 days within the day range of Monday to Saturday. For the purpose of illness benefit the week is Monday to Saturday. An employee out of work Monday to Friday will be considered to have been out for 6 consecutive days under illness benefit.
  • Employees initial day of incapacity is Monday
  • Employer normally pays for the entire period of incapacity

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Posted in Company handbook, Contract of employment, Employment Update, Sick Leave/Absence Management

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