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05.02.2019

Employment law reforms come into effect in March

Prepare your organisation in advance of employment law reforms that commence in March

The President signed the Employment (Miscellaneous Provisions) Act, 2018 (the Act) into law on Christmas day last year.

This new employment law introduces numerous changes that all ROI employers need to actively prepare for before the law comes into effect in March 2019.

The Act represents a significant reform of two key employment statutes, the Organisation of Working Time Act, 1997 and the Terms of Employment (Information) Acts 1994 – 2014.

Read on to see how these reforms will affect your organisation.

  1. Five core terms to be issued within five days of employment

The Act provides that employers must give employees five core terms of employment within five days of commencement of employment.

  1. The full name of the employer and employee
  2. The address of the employer
  3. The expected duration of the contract (where the contract is temporary or fixed-term)
  4. The rate or method of calculating pay
  5. What the employer reasonably expects the normal length of the employee’s working day and week will be.

Criminal liability

Failing to provide employees with these core terms within five days of employment commencing will be an offence. Employers will be most concerned by the introduction of criminal liability for failure to provide the five core terms within one month of employment commencing. Employers who fail to comply with this new requirement may face 12 months’ imprisonment. It is also an offence for an employer to deliberately misrepresent any information provided in the statement of five core terms.

  1. Prohibiting zero hour contracts save in certain circumstances

The Act prohibits zero hour contracts except where the casual contract is essential to allow employers to provide cover in;

  • emergency situations or;
  • short-term relief work to cover routine absences for the employer.

 

  1. New minimum payments for employees not called into work on a certain week

The Act retains the same payment mechanism as per zero hour contracts legislation, which is 25% of the contract hours or 15 hours whichever is the lesser of the two. A significant change under the Act is the introduction of a minimum payment of three times the national minimum wage hourly rate or the rate as set out by an employment regulation order. The new minimum payments will be payable to employees who are not called into work on a certain week. The same rule applies to employees who have been asked to work less than 25% of their weekly contractual hours.

 

  1. Employees enjoy right to be placed in a band of hours

The Act introduces a new right for employees whose contract of employment does not reflect the reality of the hours they habitually work. Where an employee feels that their contractual hours do not accurately reflect the hours they are actually working, employees will now be entitled to request to be placed in a band of hours that more accurately reflects the hours they habitually work over a 12-month reference period as against their contractual hours.

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

 

Employers may refuse an employee’s request where:

  1. the facts do not support the employee’s claim
  2. significant adverse changes have impacted on the business (e.g. loss of an important contract)
  3. emergency circumstances (e.g. business has had to close due to flooding)
  4. where the hours worked by the employee were due to a genuinely temporary situation (e.g. cover for another employee on maternity leave).

The provision will not apply to banded hours’ arrangements which have been agreed through collective bargaining.

  1. Strong anti-penalisation provisions

The Act provides strong anti-penalisation provisions for employees who invoke their rights under the new legislation together with strong penalties for employers who do not comply with its provisions.

These include:

  • Awards to employees who are not issued with the core employment terms in writing within 5 days of starting employment (4 weeks’ pay, in line the Terms of Employment and Information Acts 1994-2014)
  • Fines of up to €5,000
  • Anti-penalisation awards of up to two years’ salary
  • Fixed penalty notices
  • Imprisonment of up to 12 months
  • Potential for personal liability for senior employees and directors where they have consented or connived in non-compliance in respect of certain offences

Practical steps to take

  1. Amend your contracts of employment to ensure compliance with the Act. Casual hours or zero hour contracts will be prohibited unless, you can demonstrate it is for genuine casual or short-term employment.

 

  1. Make it an essential HR practice to confirm the five core terms and conditions at the offer stage in writing, and follow on with the contract of employment in advance of the employee commencing employment.

 

  1. Any current employee that does not have a contract of employment on file should be issued with written confirmation of their terms and conditions in advance of the Act coming into effect in March 2019. The Act will apply to both current and new employees.

 

  1. Conduct an analysis of your casual work arrangements and assess what band of hours variable hours employees fall into.

 

Concerned about how this new employment law will affect your organisation? Please contact the advice line on +353 1 886 0350 to speak with a consultant on this or any other HR issue affecting your organisation.

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