Employment (Miscellaneous) Provisions Act 2018

This Employment (Miscellaneous) Provisions Act 2018 (the ‘Act’) was enacted on the 25 December 2018 and is due to commence no later than March 2019.  One of the primary aims of this legislation is to provide security and certainty for employees and thereby assist their ability to access credit facilities.

Minister Regina Doherty T.D. who proposed the Employment (Miscellaneous Provisions) Bill in 2017 stated that the objective of the legislation was “to improve the security and predictability of working hours for employees on insecure contracts and those working variable hours”.

While the amendments do create security of employment and provide certainty for employees, this has resulted in employers being faced with additional administrative burdens and potential criminal sanctions for non-compliance. Although the Minister was adamant that the Act aimed to achieve some balance between employee and employer interests, the benefits to employees seem to pale in comparison to the burden now faced by employers.  

The key changes made to existing Irish employment law by the Act are:

  • Zero Hour Contracts

The Organisation of Working Time Act 1997 (the ‘1997 Act’) is amended by the Act to expressly provide that so called ‘zero-hour’ contracts (which are prevalent in the retail and hospitality sector) are no longer permitted save in emergency circumstances or in cases of short-term relief work.

  • Minimum Working Hours

Further amendments to the 1997 Act are made to the effect that in circumstances where an employee is required to make themselves available for work a certain number of hours per week and are not given at least 25% of those hours, the employee is to be entitled to a payment in respect of the deficiency, subject to a minimum payment of 3 times minimum hourly wage.

In addition, where an employee is required to make themselves available for work, but the work is carried out by another, the employee is to be entitled to payment equivalent to 25% of the hours worked by that other employee or 15 hours whichever is less, subject to a minimum payment of 3 times minimum hourly wage.

  • Banded Working Hours

The introduction of banded working hours, again by amendment of the 1997 Act, is designed to address the situation seen as unacceptable to the Minister where “..employers.. provide contracts of employment that are so vague about an employee’s hours of work as to be completely meaningless’.

Pursuant to the newly inserted section 18A the 1997 Act now provides that where a contract of employment does not provide certainty as to the number of hours to be worked by an employee, at the request of the employee they are entitled to be placed in a band of working hours that will more accurately reflect the number of hours worked. The employer has 4 weeks’ from the date of the employee’s request to be so placed, using the hours worked in the previous 12-month period as a reference.

When an employee is contractually banded as per the bands set out in the legislation, they are then entitled to work an average of these hours for the next 12 months.

Clearly these new provisions significantly improve the predictability and security of working hours for employees, and it is hoped, will thereby lead to a significant improvement in such workers being able to access credit facilities.

Under this new Section 18A, the 1997 Act an employee may make a complaint to the Workplace Relations Commission (‘WRC’) where its employer fails to meet their request for banded hours or unreasonable refuses to do so and seek the WRC to direct the employer to place the employee in the relevant band. 

Although, it is provided that an employer may not penalise any employee who invokes their rights under the Organisation of Working Time Act 1997, there is no ability for an employee to seek compensation for any failure on the part of the employer.

  • Five Core Terms in Five Days

Pursuant to Section 3(1) of Terms of Employment (Information) Act 1994 (the ‘1994 Act’), employers are obliged to provide each employee, within 2 months of his/her commencing work, with a written statement detailing certain prescribed terms that apply to their employment.

The Act now inserts a new Section 3(1A) in the 1994 Act which requires employers to provide a written statement to their employees, within 5 days of the commencement date, setting out the particular details of the following five core terms of employment:

  • the full names of the employer and the employee;
  • the address of the employer in the State;
  • in the case of a temporary contract of employment, the expected duration thereof or, if the contract of employment is for a fixed term, the date on which the contract expires;
  • 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;
  • the number of hours which the employer reasonably expects the employee to work in a normal working day and a normal working week.

Again, an employee can complain to the WRC where there has been a failure on the part of the employer to do so and the WRC is empowered under this legislation to require the employer to provide the written statement of terms to the employee and/or order the employer to pay compensation to the employee in an amount not exceeding 4 weeks remuneration.

  • Offences

Perhaps the most startling provision in the legislation is the introduction of criminal penalties for non-compliance by employers by virtue of the newly inserted section 6B of the 1994 Act.

An employer, who fails to provide the statement required at new section 3(1A) of the 1994 Act, or provides false or misleading information to an employee, shall be guilty of an offence and shall be liable on summary conviction to a fine or imprisonment (not exceeding 12 months) or both. Where a body corporate is the employer, the penalties may apply directly to the directing officer of that entity.. The relevant prosecution is brought by the WRC and, if successful, the court shall order the defendant to pay the costs and expenses of the WRC.

Again, the insertion of the new Section 6C to the 1994 Act protects employees from penalisation for invocation of their statutory rights.

Conclusion

The majority of Irish employment legislation is protective of employees and should be welcomed by both employees and employers however this Act brings with it significant new obligations on employers under the threat of criminal sanctions and exposure to compensation. Employers should be advised to review their current employment arrangements, policies and procedures and perhaps provide new enhanced terms of employment to employees affected by these legislative changes to ensure that they do not fall foul of the law.

For further information please contact Bríd McCoy (Partner), or your usual AMOSS contact.

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