The Employment ( Miscellaneous Provisions) Act 2018 commenced on the 4th March 2019. Employers will need to review their employment practices in detail to assess the impact of the new Act on their businesses. The new legislation provides that:
- Employers will need to give a written statement within 5 days of a new employee starting work.
- ‘zero hour’ contracts prohibited (unless there is a genuine requirement for a short-term/casual employee).
- Allow employees to request to be put in a ‘band of hours’ that reflects the actual hours worked rather than the contracted hours.
- New concept of ‘banded hours’ introduced.
- Provide a new minimum payment to be paid to employees who are expected to be available for work but not required to work on a certain week or who work less than 25% of their weekly contractual hours in a week
- Recognise that casual employees who are employed on a regular and systematic basis are entitled to deemed continuous service between separate periods of employment. Seasonal employees, for instance, who are re-engaged by their employer for a second period of employment will be deemed to have been on lay-off and will accumulate continuous service between contracts
- There are 5 core terms to be included in the Written Statement. These are as follows:
- The full name of employer and employee
- The address of the employer
- Where the contract is temporary, the expected duration of the contracts or the date of expiry of a fixed-term contract
- The rate or method of calculating pay and the pay reference period
- What the employer reasonably expects to be the normal length of the employee’s working day and week.
Under the new legislation, failure to comply can give rise to a criminal offence with fines up to €5,000 and imprisonment of up to 12 months. Liability falls to anyone with responsibility in the company
Zero-Hours Contract
A zero-hours contract of employment applies where you (the employee) are available for work but your hours of work are not specified under your employment contract. A zero-hours contract requires you to be available for a certain number of hours per week, or when required, or both. These are only available only exceptional circumstances:
- Work of a casual nature
- Work done in emergency situations
- Short-term relief to cover routine absences
For example, where a member of staff in a care facility must accompany a resident to hospital at short notice, an appropriate substitute worker can be called in to cover under a zero-hours contract. Similarly, schools maintain a panel of teachers to provide substitute cover for the unexpected absence of a regular member of the teaching staff.
Minimum payments
You must receive a minimum payment if you are called in to work but sent home without work (except in emergencies, exceptional circumstances or short-term relief, for example). You must get pay for 25% of the possible hours or for 15 hours, whichever is less.
New calculations for these minimum payments are set out in the new legislation. Your pay should be calculated as either 3 times the national minimum wage or, if applicable, 3 times the minimum hourly rate in an Employment Regulation Order.
An employee under a zero-hours contract who works less than 25% of their potential hours in any week should be compensated. The level of compensation depends on whether you got some work or none at all:
- If you got some work, your compensation should bring you up to 25% of the possible available hours or 15 hours, whichever is less.
- If you got no work, the compensation should be either for 25% of the possible available hours or for 15 hours, whichever is less.
For example, if you are required to be available for 20 hours per week, but you got no work, you would be entitled to be compensated for 15 hours or 25% of the 20 hours (that is, 5 hours), whichever is less. In this case, 5 hours is the lesser amount.
If, on the other hand, you got 3 hours’ work out of the 20, you would be compensated for 2 hours’ pay, to bring you up to 25% of the contract hours.
To calculate the minimum payment in this example, €9.80 per hour is the national minimum wage. Alternatively, you could substitute the ERO hourly rate if this applies to your job.
You got no work: (€9.80 x 3 times x 5 hours) = €147
You got 3 hours’ work: (€9.80 x 3 times x 2 hours) = €58.80
This minimum payment rate does not apply if you are on call.
Banded hours
Where an employee’s current employment contract does not accurately reflect the average hours per week that they actually work over a 12-month period, the employee is entitled to a banded hours contract. A banded hours contract gives the employee the right to work an average of the hours in your specified band for 12 months. There are 8 bands covering a certain number of hours per week:
Band A: 3 to 6 hours
Band B: 6 to 11 hours
Band C: 11 to 16 hours
Band D: 16 to 21 hours
Band E: 21 to 26 hours
Band F: 26 to 31 hours
Band G: 31 to 36 hours
Band H: Over 36 hours.
An employer has the right to refuse on the grounds of no evidence to support the employees claim such as there have been significant adverse changes to the business or due to exceptional circumstances e.g. emergency or the average hours were affected by a temporary situation. Any complaints are taken to the Workplace Relations Commissioners.
Minimum Wage
The minimum wage increased from 1st January 2019 to €9.80 per hour for an experienced adult worker. Under the new legislation anyone under 18 who is not experienced will receive 70% of the minimum wage, anyone aged 18 who is not experienced will receive 80% of the minimum wage and anyone aged 19 who is not experienced moves to 90% of minimum wage.
Top tips on how to prepare for the changes:
1. Review your current employment contracts
2. Do employee’s hours worked match contractual hours?
3. Do management understand their new obligations?
4. Will you be able to provide contracts within 5 days?
5. Review your zero-hours contracts/practices – are they justified?
