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28.02.2019

Zero hour contract ban in force from 4th March

New working time laws come into force on March 4th

The Employment (Miscellaneous Provisions) Act 2018 (the 2018 Act) will amend one of the central pieces of Irish employment legislation, the Organisation of Working Time Act, 1997 (OWTA). From the 4th March, 2019 the changes to the OWTA will come into force introducing a prohibition on zero hour contracts and a new employee right to request to be placed in a band of hours that reflects their actual hours worked over a 12-month reference period.

Zero hour contracts banned

Section 18 of the OWTA is amended to prohibit zero hour contracts except in the following circumstances:

  • where the work is of a casual nature;
  • where the work is done in emergency circumstances; or
  • short-term relief work to cover routine absences for the employer.

Casual workers remain outside the scope of the 2018 Act

What are sometimes known as ‘if and when’ contracts are not covered by the Act or the OWTA. The main distinction between zero hour contracts and ‘if and when’ contracts is the absence of mutual obligation. Under an ‘if and when’ arrangement, there is no obligation on the employer to provide work and likewise the employee is under no obligation to accept any work offered.

Introduction of minimum payments when no work is available

The OWTA is also amended to allow for the introduction of minimum compensation payments in certain circumstances. The existing minimum payments mechanism that applies to zero hour contracts is retained subject to the introduction new minimum payments where an employee is called into work and sent home again without working their expected hours of work. Employees who do not receive their contractual weekly hours (or less than 25% of their weekly hours) are entitled to receive a payment of three times the national minimum hourly rate of pay or three times the minimum hourly rate of pay as set out in an Employment Regulation Order (if one exists and for as long as it remains in force). This new minimum payment will be payable on each occasion an employee, to whom section 18 applies, is called into work and does not receive the expected hours of work.

Banded hours

The introduction of banded hours affords employees with a new right to request to be placed in a band of hours that reflects the reality of the hours they habitually work over a 12-month reference period. The 2018 Act inserts a new section 18A into the OWTA. You should note that a continuous period of employment which has been in place immediately before the Act came into force is reckonable towards the 12-month reference period.

Employees must make the request to be placed in a band of weekly working hours in writing. If the employee’s request is substantiated, the employer place the employee in the relevant band no later than four weeks from the date the employee makes the request.

Banded hour arrangements entered into by agreement following collective bargaining are excluded from section 18A.

Anti-penalisation provisions

The 2018 Act also strengthens anti-penalisation provisions to protect employees who seek to exercise their rights under the OWTA. If an employee claims to have been penalised for asserting his/her rights under the Act, they will be entitled to make a claim in the Workplace Relations Commission and receive an award of compensation of up to two years’ remuneration.

Reform of Terms of Employment (Information) Acts

The 2018 Act also makes major changes to the Terms of Employment (Information) Acts

which include a requirement to provide employees with a “Day 5” statement setting out five core terms of employment. Failure to provide this statement within one month of employment commencing is a criminal offence punishable by a €5,000 fine or up to 12 months in prison or both.

For more information on the changes to the Terms of Employment (Information) Acts, click here.

With new employment laws coming into force, it is vital to review your employment practices to ensure they are compliant.

Please contact the advice line on +353 1 886 0350 to speak with a consultant regarding the new laws or any other HR issue affecting your organisation.

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