New Employment Law Provisions in 2019: Zero Hours Contracts, Banded Hours Contracts, Criminal Penalties for Employers

zero hours contracts

The Employment (Miscellaneous Provisions) Bill, 2017, when passed into law in Ireland-expected to commence in March 2019-will bring about some significant changes for Irish employers and employees. In fact, it makes certain breaches of the act a criminal offence: if the employer incorrectly designates an employee as ‘self-employed’, for example

Purpose of the bill

The main thrust of this new law is to deal with ‘precarious work’, zero hours contracts, and uncertain working conditions for employees in industries which would have relied on a great deal of flexibility in the employment contract; service industries such as retail, hospitality, and tourism for example.

Most employers in these industries have made ample use of flexible working arrangements to meet the needs of their business, especially long working hours and seasonable peaks and troughs in trade and the demand for staff.

Main elements

The significant elements of this bill are

  1. The employer must give a written statement of 5 core terms of employment within 5 days of starting employment.

    These 5 terms are
    a) the full name of employer and employee
    b) the address of the employer
    c) the expected duration of the employment contract
    d) the method of calculating or rate of pay
    e) the expected normal working day and week

    Failure to provide this statement can lead to the criminal prosecution of the employer.

  2. Banded hours provisions

    The employee has a statutory entitlement to a banded hours contract where their contractual working hours over the previous 12 months do not reflect their actual working hours. If the employee requests such a contract he must be given the banded hours contract unless

    i) the employee’s claim is not supported by evidence
    ii) there have been significant adverse changes to the employer’s business in the previous 12 months
    iii) the hours worked in the previous 12 months were brought about by a temporary situation which no longer exists

    There are 8 different bands as follows:
    Band              From                     To
    A                     3 hours                 6 hours
    B                     6 hours                 11 hours
    C                     11 hours              16 hours
    D                     16 hours              21 hours
    E                      21 hours              26 hours
    F                      26 hours              31 hours
    G                     31 hours              36 hours
    H                     36 hours and over           

    Once an employee is placed on a particular band she is entitled to work an average of those hours for the following 12 months.

  3. Designation of employees

    An employer can be held criminally liable if she incorrectly designates and employee as ‘self employed’. Imprisonment of up to 12 months and fines of up to €5,000 are the maximum penalties.
    The employer has a defence, however, if he can show that he exercised due diligence and took all reasonable precautions when arriving at the designation.
  4. Prohibition of zero hours contracts

    Zero hours contracts will be prohibited unless used in specific exceptional circumstances of genuine casual employment and where they are essential for the needs of the business in the short term or in emergency situations.

  5. Continuity of employment

    Employees who are given a series of fixed term contracts will be deemed as being on layoff and will accumulate ‘continuous service’ for the purpose of protections from various employment law statutes.

  6. New minimum payment

    There will be a new minimum payment entitlement for employees who are not called into work on any given week. The employee will be entitled 25% of their weekly contracted hours.

  7. Strong penalties for employers

    The bill provides strong sanctions against employers for penalising employees who seek to enforce their rights under this bill and also strong penalties for not implementing the provisions of this bill.

You can learn more about the Employment (Miscellaneous Provisions) Bill 2017 here.

Unfair Dismissal Claims Arising from Redundancy-Employer’s Conduct Must Be Reasonable

redundancy procedure
Redundancy procedure must be fair and reasonable

Any decision to make an employee redundant runs the risk of being challenged by the employee with a claim to the Workplace Relations Commission for unfair dismissal.

In a non collective redundancy the employer needs to be absolutely satisfied that

    1. The redundancy is a genuine one, not a sham or a ruse to terminate the employment of an employee who has been targeted
    2. The selection process has been fair with “the selection criteria being used should be objectively applied in a fair manner.”
    3. The procedure in carrying out the redundancy is fair.

Two useful decisions in this connection are ADJ-00001516, a decision issued on 6th December, 2016 in which the employee was awarded €21,750 for unfair dismissal arising from a redundancy and a Labour Court decision, UDD 1638 in which the employee was awarded €35,000 in consequence of the way the employer carried out the redundancy.

The adjudication officer in ADJ-00001516 referred to a previous decision of the Employment Appeals Tribunal in Case No. UD206 / 2011. In that case the EAT held

“When an employer is making an employee redundant, while retaining other employees, the selection criteria being used should be objectively applied in a fair manner.”

The EAT also held that any consultation must be real and substantial, not merely a going through the motions or box ticking exercise.

Right to Appeal

IN the ADJ-00001516 case the adjudication officer also noted that

“I also note that the complainant was not advised of any process by which he could appeal the decision on the termination of his employment.”

The adjudication officer also referred to the following extract from the 2011 EAT case in which the EAT held that

“There was no serious or worthwhile consultation with the claimant prior to making her redundant. The consultation should be real and substantial.

No suitable or substantial consideration was given to alternatives to dismissing the claimant by reason of redundancy.

There was no worthwhile discussion in relation to the criteria used for selecting the claimant. The selection criteria should apply to all employees working in the same area as the claimant but should also consider other positions which the claimant is capable of doing.”

It is reasonable to assume that WRC adjudication officers will judge these types of case applying the above criteria. Therefore if you are an employer you would need to pay attention to this decision.

Labour Court

In a separate case, the Labour Court had to deal with an appeal by an employer against the decision of the WRC in which the employee was awarded €35,000 for unfair dismissal in a ‘redundancy’ situation.

The Labour Court held that there was a genuine redundancy but the conduct of the employer in carrying out the redundancy was not reasonable and varied the award from €35,000 to €20,000. The full decision of the Labour Court in this case ( UDD 1638) can be read here.

The Labour Court held,

It is clear to the Court that the Appellant, in the manner in which it executed the dismissal of the Respondent, engaged in the minimum of consultation and in effect put a decision rather than a proposal to the Respondent at a meeting on 27th and 28th October. The Court notes that some engagement took place as regards alternatives which might exist on 28th October.

It is clear to the Court also that the Appellant made no avenue of appeal available to the Respondent in a situation where the Respondent was dissatisfied with the decision to terminate his employment with the Appellant.

In its decision it also stated

The Court, while finding that the Respondent’s position was redundant also finds that the manner of his dismissal as result was procedurally unfair. The Respondent was not consulted adequately, he was not afforded representation at the meeting on 27th October 2015 and he was denied the opportunity to engage with the Company Board when he requested that facility in a situation where he was not satisfied with the termination of his employment which had been communicated to him at a meeting on 27th and 28th October 2015.

Takeaway for employers

You will note from both of these cases that the WRC and the Labour Court accepted that the redundancies were genuine in each case.

Where things went against the employer and substantial awards to the employee arose, however, were as a consequence of the procedures adopted to give effect to the redundancy.

In short, the conduct of the employer was not held to be reasonable in both cases. Thus, it is not enough that a genuine redundancy situation exists-the procedure used to carry out the termination must be fair and reasonable at each step.

And from the cases referred to above we can assume that the following steps are strongly advisable:

  • Real and substantive consultation
  • Right of representation
  • Right to appeal the decision.

A Sexual Harassment Story (Ana’s Story)

Ana came to Ireland from Croatia in 2014.

She knew a small number of Croats living in Dublin and they had told her she would find work here quickly enough.

They were right and she started a job in a coffee shop in the southside of Dublin within 2 months of arriving in Dublin. She quickly settled in Dublin and shared a house with 7 other people-2 Croats, 3 Poles, and 2 Irish.

Her English was not fluent but improving and she spoke well enough to get by, get her job done, and avoid too much confusion with anyone she came into contact with in the course of her days.

She spent a few weeks just clearing tables, cleaning, checking in orders, cleaning toilets, running to the cash and carry but soon she was pressed into service serving customers.

She found it difficult at first and was afraid of making serious mistakes.

But she learned quickly and was popular with the regulars who recognised her pleasant, friendly personality and smile, and her willingness to learn.

When she came to see me for the first time she fidgeted and played with a ring she wore.

She told me about her background, her 3 brothers and family in Zagreb. She never went into great detail when speaking with me about her time in Zagreb but her face darkened noticeably and I could see she was not comfortable speaking about it.

She did tell me, though, that she was on her way to primary school in May, 1995 when rocket attacks on Zagreb killed her uncle and aunt.

When she was sexually assaulted in the workplace, however, she made an oblique reference to her childhood in Croatia.

She said, “I’ve been through a lot at home in Croatia, I’ve seen most than most people my age, but this thing in the workplace was just a humiliation; I have put up with a lot of stuff before I came to Ireland but this was too much to expect me to take”.

She said the worst part wasn’t the assault, however, it was not being believed when she complained. And the investigation that was carried out being a complete whitewash and waste of time.

She had worked in the coffee shop for 7 months or so and was getting good experience under her belt. Her problems started when the manager of the coffee shop decide to go travelling for a couple of years with her boyfriend and the two of them went to Canada for a year.

The new manager, Seamus, was friendly at first; maybe too friendly. Always grinning at her like a shark.

Soon,however, Ana began to feel uncomfortable with Seamus’s attention. He was just weird and creepy.

At first he just made a small number of jokes with sexual innuendo.

Most people would probably consider them to be just part and parcel of the workplace, banter if you like.

But the “jokes” and innuendo got worse to the point where the situation was wearing Ana down.

She felt like quitting her job rather than face these dumb, offensive remarks every day-remarks about her appearance, her private life, her boyfriend, and so on.

Ana wasn’t in the job too long, however, and was still on probation so she felt the best thing to do might be to keep her head down, not rock the boat, and hope that Seamus would lay off or get fed up and just leave her alone.

She spoke to some of the other girls about it and they told her they had to put up with the same crap. They told her they were afraid to complain because they were not Irish and he was, and they were afraid they would not be believed and, anyway, who were they to complain to?

They weren’t sure of the whole situation, the legal situation, who was to help them; it was completely new to them but they were sure that the new manager would probably have more sway and influence with the owner than they had and would be more likely to be believed.

Besides it would be easier to replace one of the support or waitressing or retail staff rather than the manager. So they felt in a vulnerable situation.

What’s more, if they complained and were not believed the atmosphere in the workplace would be even worse, and they would feel like fools.

So they just stayed quiet and hoped he would get fed up and lay off.

Ana took the same approach and did nothing about the ‘jokes’ which were getting worse and more graphic.

Unfortunately this decision, however, backfired for Ana because Seamus took encouragement from her silence and her failure to make clear that his comments were unacceptable. He was emboldened. It got worse, not better, as time went on.

It was about 11 months after starting in this workplace that the final incident happened.

She remembered it well, it was a Tuesday afternoon at 3.45 pm. She could not believe it at first.

At first she was outraged but was so surprised and shocked that she wasn’t even sure it had actually happened.

What happened was Seamus had walked behind her back into the kitchen and put his hand on her bottom and whispered “you have a fine arse, Ana”.

Ana was stunned. She did not know what to do and went to the toilets, shook with anger and wept silently.

Her mind cleared, though, and then she was sure of exactly what he had done.

The bastard had put his hand on her bottom, treated her like a piece of meat, and ignored her dignity as a person. No respect.

This had gone on too long.

She dried her tears, gathered her courage as best she could and went straight to Seamus. She told him that what he had done was completely unacceptable, that she felt humiliated and demanded an apology.

Seamus’s face reddens and his mouth tightens and a little tic develops on the left side of his mouth. He denies it completely, tells her she is nothing but a troublemaker, and nobody will believe such a stupid allegation.

Ana felt faint, confused, could not think straight.

She goes into the little store at the back of the shop that passes for a staff room, takes her bag out of her locker, puts on her coat and heads for the bus stop to go home.

Ana sits in her kitchen for 90 minutes nursing a cup of coffee.

She debates with herself about what to do: should she leave or make a formal complaint or just forget about it and tough it out or start looking for another job?

She pulls out the staff handbook from underneath her bed and discovers how she is to make a complaint.

Two days later she receives a message from the owner of the business who tells her she has appointed an external HR person to carry out an investigation.

An investigation was quickly carried out and Ana made a statement about what happened and what had happened previously. She told the investigator that it was common knowledge what Seamus was like-all he had to do was check with the other girls.

The investigator called in the other 2 girls and asked them if they ever had any difficulty with Seamus.

They told of the long running difficulties that they had experienced with him: inappropriate remarks, comments about their clothes, how they looked, their make up, told them jokes that always involved some sexual comment, and so forth.

Ana reads the letter again for the second time and she can’t believe it. She has received it by registered post and it tells her the outcome of her complaint is that the investigator from the HR company does not uphold her complaint.

The reasons given are a “conflict of evidence” and one person’s word against another’s and the absence of any witness to the alleged incident.

The letter is worded really nice and professional and it tells her the employer values her greatly and hopes she will be able to come back to work soon and are sure that her relationship with Seamus can be rebuilt “going forward”.

Ana reads it for the third time. She cannot believe it. She’s thinks she is going to be physically sick. Really throw up.

She’s not sure what to do, or what she can do.

But she knows one thing: she cannot go back into that workplace.

Ana sits in my office now. She plays with her ring, a big blue stone of a thing. She is teary and weepy and I get a small box of tissues.

She is determined about one thing: she will not let this go. She wants to take it further and tell her story. She hasn’t come from a difficult upbringing in Zagreb to Ireland to have some deviant treat her like a piece of fine meat.

We submitted her claim to the WRC without delay. It was an Employment Equality act 1998 claim that she had suffered discrimination in the workplace by reason of her gender and had been the victim of sexual harassment.

Sexual harassment is defined in Section 14A Employment Equality Act 1998 as

references to sexual harassment are to any form of unwanted verbal, non-verbal or physical conduct of a sexual nature,

being conduct which in either case has the purpose or effect of violating a person’s dignity and creating an intimidating, hostile, degrading, humiliating or offensive environment for the person.

Now, it is 8 months later and we have received the decision of the WRC adjudicator. The WRC have found that Ana’s complaint was “well founded” and she has been awarded €27,000 in compensation.

It is open to the employer to appeal this decision to the Labour Court.

But Ana doesn’t care; she has told her story to an independent adjudicator and has been believed. Not alone that but the wrong that was done to her in the workplace has been recognised by an award of compensation. It wasn’t just a trivial, inconsequential, technical wrong.

It was a serious attack on her self respect and dignity.

The money is not the important thing to Ana, but it will give her time to get on her feet again, get another job, maybe send some home to her family outside Zagreb.

(Please note “Ana” and “Seamus” are not the real names of the parties involved in this case and some facts have been changed slightly to prevent identification).

 

Exceptions to the 12 Months’ Service Requirement in Unfair Dismissal Claims

fair-dismissal-procedures

If you are unfairly dismissed and wish to bring a claim under the Unfair Dismissals Act 1977 you will need to have been employed continuously for 12 months.

If you do not have 12 months’ service you cannot bring a claim for unfair dismissal or constructive dismissal if you cannot clear this hurdle.

That is the bad news; the good news is there are some important exceptions to this 12 months’ service requirement. Let’s take a look at them, shall we?

Exceptions to 12 Months’ Service Requirement

  1. Protected disclosure-if you are dismissed for having made a protected disclosure under the Protected Disclosures act 2014 you do not need 12 months’ service
  2. Discrimination-if you were dismissed on a discriminatory ground you will be able to bring a claim under the Employment Equality Acts without 12 months’ service
  3. Trade union-an employee who is dismissed for trade union membership or activity does not require 12 months’ service
  4. Pregnancy, birth, breastfeeding-any dismissal connected with these issues can be brought without 12 months’ service
  5. Maternity protection-any dismissal arising from the exercise of a maternity right does not need 12 months’ service
  6. Adoptive leave-any dismissal arising from the exercise of an adoptive leave right does not need 12 months’ service
  7. Parental leave and force majeure leave-12 months’ service is not required for unfair dismissal claims arising from these rights
  8. National Minimum Wage Act, 2000-any dismissal arising from the employee seeking to exercise rights under this act can be brought without 12 months’ service
  9. Carer’s Leave act-12 months’ continuous service is not required.

It is inevitable that if you bring a claim the employer may well argue that you do not have the necessary 12 months’ service and will deny that you were dismissed arising from any of the exceptions set out above.

Clearly, each case will be dealt with on its own facts and circumstances but you will need to be prepared for this argument and ready to put forward facts from which it can be inferred that your dismissal did arise from the exercise of one of the categories listed above.

Technical Breaches of the Law and the De Minimis Rule-the Labour Court’s Approach

the labour court

What happens if there is a technical breach of the law by an employer but the employee has not suffered any prejudice or detriment?

Do you know what the “de minimis rule” is? It might be a good idea to be aware of it.

Let me explain.

An employer must give an employee a written statement of certain terms and conditions of employment within 2 months of starting the employment. This is normally referred to as a written contract.

The relevant legislation-the Terms of Employment (Information) act 1994-sets out the various things that need to be included in this statement. There are some further matters that must be included pursuant to the Terms of Employment (Additional Information) Order 1998 (SI 49/1998).

Between the 1994 Act and the statutory instrument from 1998 there is approximately 20 matters that must be covered.

What happens however if there is a technical breach of the obligation? By this I mean an employer does indeed give a written statement but omits a small number of things that he should have included, or there is some other technical breach of the obligation.

What happens if a minor, trivial, technical breach does not lead to any prejudice or disadvantage to the employee?

A recent Labour Court case dealt with such a claim in Component Distributors (CD Ireland) Ltd and Brigid (Beatrice) Burns.

The Complainant, Ms Burns, had brought a claim to the Workplace Relations Commission alleging breach of the Terms of Employment (Information) act 1994. The breaches were minor and the Adjudicator awarded her €200.

She appealed this decision to the Labour Court.

The alleged breaches of the employer’s obligations were

1. The full name of the employer was not set out in the contract insofar as the contract omitted “CD” and “(Ireland)”

2. The statement did not set out the employee’s breaks

3. The employer’s annual leave year did not run in tandem with the leave year referred to in the Organisation of Working Time Act 1997

The Labour Court and the De Minimis Rule

The Labour Court referred to a case called Patrick Hall v Irish Water TED161 in which it set out its approach to be adopted where a technical breach of this Act which had no practical consequences occurred. It then adopted and applied the reasoning set out in that case and it is worth taking a look at here.

In Patrick Hall v Irish Water TED161 the Labour Court commented:

As appears from the above, these complaints are wholly devoid of any substantive merit. The State has already incurred the costs associated with providing the Complainant with a hearing of these complaints at first instance and it is now obliged to incur the cost in time and expense of providing him with a full appeal before a division of the Court. That takes no account of the cost incurred by the Respondent in defending this case, both at first instance and now on appeal. The combined associated costs of processing and hearing these complaints is grossly disproportionate to any value that could have accrued to the Complainant if the technical infringements of which he complains had not occurred.

Moreover, the letter of offer furnished to the Complainant dated 25th July 2014 invited him to contact a named person if he wished to discuss or seek clarification on any of the terms proffered. The Complainant signed the statement without demur and returned it to the Respondent. Neither then or at any subsequent time did he request further or better particulars on any matter pertaining to his employment. The Court has no doubt that had he sought further information on any matter pertaining to his employment, including the matters which form the subject of his present complaints, it would have been provided by the Respondent.

In the circumstances of this case that represents an unacceptable squandering of public resources. It is a manifest absurdity to suggest, as the Complainant does, that these contraventions, if such they are, could or should be met with an award of monetary compensation. That is particularly so in circumstances in which the matters now complained of could easily have been rectified by a simple request to the Respondent to provide any further information that the Complainant considered necessary.

De Minimis rule

It is an established principle of the common law that a Court should not squander its resources in dealing with claims that are without substance because the contraventions complained of had no practical consequence for the plaintiff. This principle is encapsulated in the Latin maxim de minimis non curat lex (the law does not concern itself with trifles). The classic statement of where this principle should be applied is contained in the judgment of Henchy J. in the Supreme Court’s decision in Monaghan UDC v Alf-a-Bet Publications Ltd. [1980] I.L.R.M. 64, at page 69. Henchy J articulated a generally applicable test in the following terms: –

“In such circumstances, what the Legislature has, either immediately in the Act or immediately in the regulations, nominated as being obligatory may not be depreciated to the level of a mere direction except on the application of the de minimis rule. In other words, what the Legislature has prescribed, or allowed to be prescribed, in such circumstances as necessary should be treated by the courts as nothing short of necessary, and any deviation from the requirements must, before it can be overlooked, be shown, by the person seeking to have it excused, to be so trivial, or so technical, or so peripheral, or otherwise so insubstantial that, on the principle that it is the spirit rather than the letter of the law that matters, the prescribed obligation has been substantially, and therefore adequately, complied with.”

The Labour Court went further:

The Court is satisfied that, in the circumstances of this case, any deviations that may have occurred from what the strict letter of s. 3 of the Act, or from what the statutory instrument at issue prescribes, are so trivial, technical, peripheral or otherwise so insubstantial as to come within the de minimis rule. There can be no doubt that the Respondent provided the Complainant with all the information that he required in relation to the essential elements of the terms and conditions attaching to his particular employment. What is complained of is a failure to provide information on matters that had no practical significance in the context of the employment that he was offered and accepted.

In this case, Component Distributors (CD Ireland) Ltd and Brigid (Beatrice) Burns, the Labour Court determined as follows:

Determination

The within appeal is upheld in part as set out above. In its decision in Irish Water the Court held that where mere technical breaches of section 3 of the 1994 Act occur, “the dictates of fairness or equity could not justify an award of compensation”. The Court follows that reasoning in its approach to this claim.

The Court determines that the amount of compensation which is just and equitable in all the circumstances is nil. The Recommendation of the Adjudication Officer is varied accordingly.

You will note that even though the Labour Court agreed that there were breaches of the relevant act those breaches were so trivial, technical, peripheral or otherwise so insubstantial as to come within the de minimis rule.

And the Labour Court held that the technical breaches did not justify any compensation and reduced the employee’s award from €200 to nil.