Although it can be difficult to keep track at times, it is essential for organisations to keep up to date with any key changes in employment law. These laws play a critical role in defining the relationship between employers and employees, covering vital areas like hiring practices, work conditions, compensation, benefits, and termination processes. It is crucial for businesses to stay informed to ensure compliance and reduce the risk of legal complications - neglecting to monitor these changes can result in expensive lawsuits, damage to reputation, and regulatory fines.
We're eager to help you stay up to date with these changes; that's why earlier this month, our final summer webinar focused on significant updates to Irish employment law and key considerations for upcoming changes. We were delighted to welcome back Catherine Monahan, Senior HR Consultant at Action HR Services, who provided an in-depth overview of these updates. Below, you’ll find a sum-up which you can use as a handy cheat sheet to refer back to when you need.
One key update for employers is changes to the national minimum wage, which will be replaced by the National Living Wage from 2026. The Living Wage will be set at 60% of the median wage in any given year - in 2024, this is expected to equal €13.80. The Low Pay Commission have also recommended to increase the National Minimum Wage in 2025 by between €0.80 and €1.20 per hour. If this comes into effect, the national minimum wage in Ireland will be between €13.50 and €13.90 an hour. Although there is no word on whether this recommendation will be accepted, it's worth noting that the Government has never rejected a recommendation from the Low Pay Commission.
The Low Pay Commission has also recommended that sub-minimum wage rates for workers under 20 years of age should be abolished by January 1, 2025. This recommendation aligns with evolving policies across the EU, where there is a growing movement against sub-minimum wages. According to the EU Directive on Adequate Minimum Wages, any variation or reduction from the national minimum wage must be fair, proportional, and serve a legitimate purpose. After reviewing these guidelines, the Commission found no legitimate reason, based on age alone, to justify paying younger workers less.
Starting this year, employees are entitled to 5 paid sick leave days per year - 70% of an employee's wages up to €110 a day - with plans to increase this to 7 days in 2025 and 10 days by 2026. However, any further expansion on this as of now is contingent on an economic assessment due to the increasing cost of labour regulations on businesses in recent times.
New regulations under this act were published in January 2024, consolidating penalties for breaches of employment law. Employers failing to provide terms of employment or mismanaging tips and gratuities may face substantial financial penalties.
Either compliance notices or fixed payment notices can be issued - or both. It's important for employers to note that fines are per breach of the relevant employment provision and therefore have the potential to be significant for employers.
Three new on-the-spot fines were introduced, the full details of which can be found below:
|
OFFENCE |
FINE |
LEGISLATION |
|
Employer fails, without reasonable cause, to provide an employee with their terms of employment within one month of their commencement date or provides false or misleading information to the employee |
€1500 |
Sections 6B(1) and (2) of Terms of Employment (Information) Act 1994 |
|
Employer does not provide employees with a written statement on the distribution of tips and gratuities or fails to treat a service charge as a tip |
€750 |
Sections 4B(8) and 4D(2) of the Payment of Wages Act 1991 (as inserted by the Payment of Wages (Amendment) (Tips and Gratuities) Act 2022) |
|
Employer does not display a ‘tips and gratuities notice’ or a ‘Contract Workers Tips and Gratuities Notice’ |
€500 |
Sections 4E(2) and 4F(3) of the Payment of Wages Act 1991 (as inserted by the Payment of Wages (Amendment) (Tips and Gratuities) Act 2022) |
The Work Life Balance and Miscellaneous Provisions Act 2023 introduces new provisions to support employees in achieving a better work life balance. One of the key components of this Act is the Code of Practice on the Right to Request Flexible and Remote Working.
The Code of Practice for the Right to Request Flexible and Remote Working sets out details of the processes regarding making and managing requests for flexible working and remote working. It supports employers in objective, fair and reasonable decision-making and offers practical guidance to ensure compliance with legislation.
This provision aims to accommodate a range of needs, from those seeking to reduce commuting time to those requiring a more flexible work environment. In terms of eligibility, all employees are entitled to request remote working arrangements, however for flexible working arrangements, employees with children under 12 or children under 16 if the child has a disability or illness or employees with other caregiving responsibilities are explicitly entitled to request this. Flexible working includes altered working hours, part-time work, or job sharing. The right to request flexible working is also extended to all employees, regardless of caregiving status, after they have completed six months of continuous service with their employer.
Employees must submit a formal request for both types of working arrangements with 8 weeks' notice in writing. For flexible working, this request must include the form of flexible working being requested, the starting date and proposed duration. For remote working, this request must include how many and which days being requested, start and end date if relevant and reasons for request. For remote working, employees must also specify where their remote working location will be, e.g. at home, a remote working hub etc., and information on the suitability of the location. Employers may request additional information to support the application.
Employers are required to respond to these requests within four weeks. The response must either approve the request or provide a clear and justified reason for any refusal. Employers should consider each request carefully and in good faith. Factors such as the impact on the business, the nature of the job, the needs of the team, and the potential benefits to the employee should be evaluated.
Employees whose requests are denied can appeal the decision internally. The Code outlines the process for submitting an appeal and the steps an employer should take to review and address the appeal. If internal appeals do not resolve the issue, employees may seek resolution through external dispute resolution mechanisms, such as the Workplace Relations Commission (WRC).
Proper record-keeping is essential for tracking requests, decisions, and any follow-up actions. This documentation will support compliance and provide evidence in case of disputes. In general, employers need to be proactive in understanding and implementing these changes, fostering a supportive work environment that meets both their business needs and supports their employees' wellbeing.
Collective redundancies occur when an employer plans to dismiss a certain number of employees within a 30-day period, and this number exceeds a specific threshold. The threshold varies depending on the size of the business. As of July 2024, protections for employees facing redundancy have been enhanced. Employers, liquidators, and other responsible persons must now adhere to stricter notification requirements, with employees being able to seek redress from the WRC if redundancies are made before the end of the mandatory 30-day notification period.
The Employment Permits Act 2024 came into effect this September, bringing in new changes to Ireland’s employment permit system. The Act aims to consolidate the law concerning employment permits and modernise the employment permit system. Key changes include the introduction of seasonal permits - employers will be required to apply annually for these permits to be approved. Permit holders can work for 7 months per calendar year, and a pilot scheme will run for this in the horticultural sector only in 2025.
Another change under this act is that holders of a general employment permit or a critical skills employment permit can apply to change employer after 9 months without the need to apply for a new permit. Once granted, they can work out the remaining time on their current permit with the new employer. The permit holder must carry out the same role (under a general employment permit) or same category of role (critical skills permit) for the new employer.
For subcontractors and agencies, the contract for services permit is expanded to include sub-contractors, and agencies can now be the employer of permit holders carrying out work for their clients. Employers applying for seasonal employment permits, general employment permits and contract for services permits are still required to complete labour market needs tests, but are no longer required to advertise in national newspapers.
From August 2024, parents are now entitled to 9 weeks of leave (up from 7 weeks) during their child’s first two years, or in the case of adoption, within 2 years of the placement of the child with the family. Employees can claim the additional 2 weeks parent's leave if their child is under the age of 2 on 1 August 2024 or their adopted child has been placed with the family less than 2 years on 1 August 2024.
Employers do not have to pay an employee while they are on parent's leave - employees earning over €20,000 annually are entitled to €274 per week in benefits during this period.
The 2024 Supreme Court decision in the Seamus Mallon v. Minister for Justice case upheld the legitimacy of mandatory retirement ages, provided they are justified by a legitimate aim and applied consistently. This ruling offers employers more clarity on how to apply and enforce retirement policies without breaching age discrimination laws.
Specifically, the Mallon case clarifies that:
The Automatic Enrolment Retirement Savings System Act 2024 was signed into law in July 2024 and is expected to be in place by the first quarter of 2025. Auto-enrolment will see everyone earning over €20,000 a year from all employments and aged between 23 and 60 automatically enrolled in a new retirement savings system where there is not already a contribution through payroll to a company or private pension. It is estimated that 800,000 workers are set to be enrolled in the scheme.
Those excluded from auto-enrolment include the self-employed, those not earning €20,000 a year from all employments, and those who are already part of a pension scheme through their employer. Employer and employee contributions start at 1.5% of gross salary, auto-escalating every three years, until reaching the maximum contribution rate of 6% in year 10. The State will make a contribution in place of tax relief – for every €3 an employee puts in, their employer will also put in €3 and the State will top this up by €1, providing additional financial security for employees.
Key features of this auto-enrolment scheme that employers should keep in mind are:
This bill, if enacted, won't be relevant to employers who don't have a mandatory retirement age or employers whose mandatory retirement age is at or above the state pension. The purpose of the bill is to ensure that people aren't left without an income from when they leave employment to when they can access their state pension.
The General Scheme gives the option to the employee:
Effectively this means employees can opt out of the mandatory retirement age. Three months' notice must be given in writing by the employee, and the employee can withdraw their notification, but they must provide contractual notice. Employers must ensure that mandatory retirement ages do not precede the state pension age, unless the employee consents to an earlier retirement. This change aims to give employees greater control over their retirement timelines.
This bill, published in July 2024, aims to ensure that women undergoing treatment for a serious physical illness will no longer be forced to use maternity leave during their treatment. They will be able to postpone all or part of their maternity leave for up to 52 weeks, provided it is medically certified. It is currently under review whether the provision should extend to very serious mental health issues.
If the bill is enacted, it will also amend the Employment Equality Acts, restricting employers from entering Non-Disclosure Agreements with employees who allege discrimination, harassment, sexual harassment, protected disclosures or victimisation.
These extensive legislative changes have far-reaching implications for employers, particularly in relation to wages, worker protections, and flexible working. As these laws come into effect, it’s essential for businesses to stay compliant and keep updated with ongoing legal requirements to foster a fair and productive work environment.
For a detailed discussion on each of these updates, check out the full webinar recording below 👇
More resources:
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