Working Time/Rest Periods

Calculating Hours Worked for Banded Hours Contracts-Is Annual Leave to Be Counted?


This case, between a ground staff member and an airline, turned on the question of how you are expected to calculate the hours worked for the purposes of awarding an employee a banded hours contract.

The employee had been placed on a banded hours contract pursuant to the Employment (Miscellaneous Provisions) Act 2018. Section 16 of this act provides for banded hours contracts to be given to employees based on the number of hours worked per week by an employee over a reference period.

In this case the employer placed the employee on a band which reflected hours worked over a reference period but did not include hours of full annual leave entitlement.

The employer’s position was that the legislation referred to the hours worked by the employee, and the employer was not obliged to consider time on annual leave. However, the employer did, on a discretionary basis, award some hours to the employee to cover the annual leave-that is, 4 hours “work” were awarded for each day of annual leave, and there was 21 such days.

The employer’s position was that there was no obligation to consider time that the employee was absent from work, regardless of the reason. They calculated the hours for the purposes of a banded hours contract by reference to clock in data, basic hours and overtime worked, and divided the total hours worked by 52 to arrive at an average weekly hours worked.

The employer also contended for the definition of working time as set out in the Organisation of Working Time Act 1997, section 2 as follows:

working time” means any time that the employee is—

(a) at his or her place of work or at his or her employer’s disposal, and

(b) carrying on or performing the activities or duties of his or her work,

and “work” shall be construed accordingly

Adjudicator decision

The adjudicator held that there was no express provision in the Employment (Miscellaneous Provisions) Act 2018 as to how absences from work are to be treated and no provision which deems time spent on annual leave (or other absences) as time worked for the purposes of section 18A of the Organisation of Working Time Act 1997.

Nonetheless the adjudicator held that the legislators, when drafting the legislation, did not intent the employee should suffer any disadvantage by taking annual leave. And section 22(2) of he Organisation of Working Time Act 1997 states

(2) For the purposes of section 21 , time off granted to an employee under that section or section 19 shall be regarded as time worked by the employee.

He went on to hold

In the instant case, if the mode of calculation canvassed by the respondent were to prevail, as a matter of mathematical fact, in every case where an employee avails of annual leave, her average weekly working hours over a 12-month reference period would be artificially reduced below their actual average, or normal working hours. Such a result would be inconsistent with other provisions of the Act and could not reflect the plain intentions of the Oireachtas.

For all these reasons, it seems clear that an employee average weekly working hour in a reference period should be ascertained by taking the total number of hours worked by that worker over the reference period and dividing that number by the number of weeks actually worked in the same period.

Read the full decision here in ADJ-00024906

The Employment Contract

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.

(This bill became law on 4th March, 2019: Employment (Miscellaneous Provisions) act 2018.)

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.

New minimum wage rates from 4th March, 2019

Rates on or after 4 March 2019

Min hourly rate% of min wage
Minimum wage9.80100
Aged under 186.8670
Aged 187.8480
Aged 198.8290

Since 4 March 2019 trainee rates are abolished.

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

Here is the Employment (Miscellaneous Provisions) Act 2018.