It’s an easy mistake to make.
If you are an employer you are in danger of leaving yourself wide open to expensive claims by your employees if you fail to follow some basic but essential steps in your employment relationship with your employees.
In addition to settling successful claims brought by employees you also run the risk of fines and other sanctions from the National Employment Rights Authority (NERA) which has a dedicated unit, the Prosecution Services Unit, which can refer cases to the Chief State Solicitors Office for prosecution.
There is a wide body of employment legislation in force in Ireland which can be confusing for many employers.
In addition some industries have their own industry specific agreements called registered employment agreements (REA) and minimum wage rates. It is worth noting that these registered employment agreements are binding on all parties once registered with the Labour Court.
UPDATE May 2013
The Supreme Court, in May 2013, ruled that registered employment agreements are unconstitutional. You will find more updated information about registered employment agreements and employment regulation orders here.
Minimum requirements in employment law
1. Written statement of certain terms and conditions of employment
This statement must be given to the employee within two months of commencing employment.
The relevant act is the Terms of Employment (Information) Act 1994 which sets out the basic information that an employee is entitled to be given in writing about their contract of employment. You need to be careful that you provide the additional information set out in the revised act, which is
( fa ) a reference to any registered employment agreement or employment regulation order which applies to the employee and confirmation of where the employee may obtain a copy of such agreement or order, ]
F6 [ (g) the rate or method of calculation of the employee ’ s remuneration and the pay reference period for the purposes of the National Minimum Wage Act, 2000,
( ga ) that the employee may, under section 23 of the National Minimum Wage Act, 2000, request from the employer a written statement of the employee ’ s average hourly rate of pay for any pay reference period as provided in that section,
You need to be aware of statutory instrument S.I. No. 49/1998 – Terms of Employment (Additional Information) Order, 1998, which provides that you must give the employee a statement in writing containing particulars of the times and duration of the rest periods and breaks referred to in sections 11, 12 and 13 of the Act (The Organisation of Working Time Act, 1997.)
2. Written statement of pay
The Payment of Wages Act, 1991 obliges the employer to give a written statement of wages and deductions at the time of payment. Learn more about payment of wages here.
3. The minimum wage
There are exceptions to the minimum wage in Ireland of €8.65 per hour but most adults will be entitled to it; in addition certain industries have their own higher minimum wage. Learn more about minimum wage rates.
4. Maximum hours worked
Employers must keep records of hours worked by employees to ensure compliance with the maximum working week average of 48 hours which may be calculated over a 4, 6 or 12 month period depending on the industry. Learn more about working time and rest breaks here.
5. Working time and breaks
The breaks to which employees are entitled are set out in the Organization of Working Time Act, 1997. Currently break entitlements are 15 minutes per four and a half hours work and a 30 minute break for six hours worked.
6. Holiday entitlements
Holiday entitlements are also covered in the Organization of Working Time Act, 1997. In general full time workers are entitled to four paid weeks holidays per year with part timers being entitled to similar holidays on a pro rata basis depending on hours worked which equates to one third of a week per month worked. (Learn more about how to calculate holiday entitlements.)
7. Minimum notice of termination of employment
The minimum notice periods are set out in the Minimum Notice and Terms of Employment Acts 1973 to 2001 and depend on the length of service with the minimum regardless of service being 1 week.
Employers can save themselves the considerable costs in money and time involved in defending or otherwise dealing with claims by their employees by some prudent management and housekeeping.
The list above is not exhaustive, but if you took care of those 7 areas you would be in good shape as an employer.
Doing business nowadays can be a worrying enough activity without inviting needless trouble on yourself for the want of a straightforward contract of employment and/or letter of offer and/or statement of your employees’ terms and conditions.
At a minimum you should carry out an audit of your
- Contracts of employment
- Staff handbooks
- Disciplinary and grievance procedures
- All workplace policy documents.
If you don’t have any of the above, you are asking for trouble, especially when there is a dispute or a NERA inspection.