Proposal to ban zero hour contracts
Wednesday saw the approval of draft legislative proposals to ban the use of zero hour contracts. The proposal sees the ban on zero hour contracts in most circumstances and huge fines for employers for the misuse of them. The proposal brought to the cabinet by Minister for Jobs, Enterprise and Innovation Mary Mitchell O’Connor and Minister of State for Employment and Small Business Pat Breen, aims to stop the exploitation of, particularly low-paid and vulnerable workers.
The new proposal is a result of research conducted by the University of Limerick, in which they found that the use of zero-hour contracts has significantly increased in recent years. The research found that zero-hour contracts do cause issues for employees, namely uncertainty of earnings week to week. This can have a number of knock-on effects for the employee, including their ability to apply for a mortgage or their entitlement to sick pay or holiday pay.
In an effort to address these issues the draft legislation proposes a number of changes including:
- If an employee comes to work and is sent home, they will be compensated for three hours pay at three times the national minimum wage.
- Employers will be required to provide employees with clearer information about the nature and core terms of their employment arrangements within five days of commencing a job. This will include the expected duration of the contract and what the employer reasonably expects the normal length of the employee's working day and week will be.
Zero-hour contracts or if and when contracts, can offer some businesses the flexibility to manage their workforce, particularly where work demands fluctuate. The concern for small employers now is that this flexibility may be taken away from them and that they may endure significant costs if work is not available.
Although the changes may take some time to come into effect when they do they will be the most significant changes to modern employment legislation.
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Overtime working - how much can your employees do?
Getting employees to work overtime during busy periods is a great way to combat increased workload demands using your existing employees. But how much overtime can you legally require your employees to work and should you have to pay them extra for it? We take a look at what is required to keep you covered.
Overtime
The number of hours an employee is required to work a week will be included in their contract and if an employee works over this it is usually considered overtime. If you do require employees to work overtime during busy periods, this must be stated in their contract of employment. Within two months of commencing work, an employee must be provided with a contract of employment.
How much overtime can employees work?
The Organisation of Working Time Act 1997 states the maximum working week is 48 hours and this will include all overtime or second employment. The 48-hour working week can be averaged out:
- 4 months - for most workers
- 6 months - for employees working in: security industries, hospitals, prisons, gas/electricity, airport/docks, agriculture and employees in businesses which have peak periods at certain times of the year such as tourism
- 12 months - for all employees who entered into an agreement with their employer which is approved by the Labour Court.
Do I have to pay employees for working overtime?
Employers are under no obligation to pay employees for overtime worked as long as they ensure that the average pay for total hours worked does not go below minimum wage. Many employers do pay higher rates of pay for overtime or may give employees time off in lieu for hours worked overtime.
If you do require employees to work overtime you must ensure that this is clearly stated in their contract of employment. If an employee is paid overtime, this should also be included, stating overtime rates of pay and how these are calculated.
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Staff handbooks are not just for large organisations
Many small businesses that may only employ a small number of employees, often believe that they are exempt from having employee policies and procedures. This is not the case, policies and procedures are essential for not only setting clear boundaries in the employment relationship but also in protecting your business if a claim was ever brought against you to the Workplace Relations Commission or Labour Court.
A recent case study
A recent case was brought to the courts when an employee of a small, family run shoe and leather goods shop, claimed she had been harassed and sexually harassed by another concession stand holder. The employee alleged that her employer had failed to take the appropriate steps to prevent the harassment and then failed to investigate the allegations appropriately.
Finding
The employer claimed that, as a small employer, it was not necessary for them to have any anti-harassment policies in place. The court found that the Acts require employers, regardless of size, to take reasonable steps to ensure employees are protected. The court emphasised that employers must have effective measures in place to ensure sexual harassment does not occur and if it does occur that there are adequate procedures available to deal with the problem and prevent re-occurrence.
Although the court noted that the employer took appropriate action when dealing with the situation when it observed such behavior, it had failed to take appropriate measures to prevent such occurrences. The employee was rewarded €5,000 for distress and the effects of sexual harassment constituting discrimination.
Learning Points
No matter how small your workforce, be sure to protect your business with solid employee handbooks clearly outlining policies and procedures.
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€30,000 awarded to pregnant woman dismissed during probation
The Workplace Relations Commissioner ordered the owner of a seafood restaurant to pay €30,000 compensation to a pregnant employee who was dismissed during her probation.
The employee was pregnant at the time of commencing work at the restaurant as restaurant manager. Two months later, after getting the all clear in an ultra-sound, she informed her manager that she was pregnant. Following this she said she noticed a change in atmosphere. She was no longer invited to managerial meetings and then received an e-mail from her manager outlining some performance issues that had not been discussed with her previously. She replied to the email accepting responsibility to some of the issues but attributed most of them to inadequate training. She also offered to have a meeting with her boss to discuss these issues but despite her request no meeting ever took place. Three days after this e-mail was sent and one month after she gave notice of her pregnancy, she was let go.
She brought a claim under the equality legislation alleging that she had been discriminated against and dismissed due to her pregnancy. The restaurant contended that the dismissal arose from performance issues and was unrelated to the pregnancy. The restaurant claimed that adequate training had been given and that meetings to discuss performance issues took place before the announcement of her pregnancy, although no notes were recorded.
Finding
With no such records, the adjudicating officer ruled that she did not find it credible that such meetings took place. She found that due to the manager’s refusal for a meeting after the email was sent and the close proximity of the announcement of the pregnancy to the dismissal, that the pregnancy was a significant factor to the decision of her dismissal.
Learning Points
This case highlights the importance of following fair procedures and documenting these procedures when dismissing an employee. Even employees on probation are entitled to natural justice and fundamentally fair procedures.
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What harm can two jam tarts make?
The Employment Appeals Tribunal decided an employee was fairly dismissed when jam tarts were found missing from a packet. The man in question, Moran, worked in the warehouse for Keeling’s Logistics Solutions, who operated as a distribution company for the supply of goods to just one customer.
An investigation was carried out when the security manager saw Moran and a colleague “acting suspiciously” beside an open cage, containing boxes of jam tarts. He claimed to see the cage being moved and that he saw the men eating something and putting their hands inside the cage. The investigation found that Moran had tampered with a packet of jam tarts and two individual tarts were missing. CCTV footage was reviewed and the men claimed that they were sharing a Mars bar and denied eating the jam tarts.
Finding
The employer had a strict policy that no stock would be consumed on the warehouse floor and installed vending machines on the shop floor to prevent staff tampering with and eating their stock. The employer carried out a disciplinary procedure and dismissed Moran, who then appealed the decision but lost. The EAT found that Moran’s evidence was not credible and on the balance of probability that he did tamper with the stock.
“The Tribunal also found that there were no procedural defects which would render the dismissal unfair. The investigation, disciplinary meetings and appeal were thorough, fair and objective.”
Learning Points
The importance of having firm policies and applying procedures when dismissing an employee are prominent in this case. 80% of unfair dismissal cases are lost by employers not because they didn’t have a good reason for dismissing the employee but because they have failed to follow fair procedures. As an employer, you do not want to be subject for a hefty unfair dismissal claim that could have been easily avoided.
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Requiring staff to only speak English at work can be lawful
The WRC recently dismissed a claim brought by a Polish employee that alleged she had been discriminated against on the grounds of race. The Complainant in this case was told she had to speak English when working alongside colleagues who did not speak Polish.
The Company in question employed 838 people from 14 countries. The employee was asked by their supervisor to speak English while working on the factory line. The employee subsequently brought a discrimination claim against the Company. The Company argued that there was a business case for having one official language in the business.
The WRC found in favour of the employer based on evidence that they had provided diversity workshops, and had acted in good faith by asking the employee to speak English so as not to exclude other colleagues.
Learning Points
This is an area where employers need to thread carefully in order to avoid discrimination.
Generally, it is possible to limit the use of languages other than English at work, provided that the policy:
- applies to all nationalities
- there are justifiable (and non-discriminatory) reasons for imposing the policy.
Some possible acceptable reasons may include:
- Health and safety implications
- Security risks
- Impact on workplace effectiveness
It is advisable that requests to speak English should only apply to operational activities. Discussions at break times or in the canteen should be exempt.
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Constitutionality of WRC questioned
Leave has been granted to challenge the constitutionality of the Workplace Relations Commission procedures to determine employment rights disputes.
The actions could have important consequences for the WRC, which was established in 2015. It replaced the previous Employment Appeals Tribunal system of adjudicating claims for unfair dismissals and wages payment disputes.
The current case before the High Court was taken by solicitors on behalf of Tomasz Zalewski, who claims he was unfairly dismissed last December by Buywise Discount Store Ltd., where he was employed as a Store Supervisor and Security Guard.
Mr. Zalewski feels he was not afforded fair procedure and constitutional justice when the adjudication officer upheld the dismissal. Mr Justice Noonan granted Mr Zalewski leave to judicially review the officer’s decision and restrained the WRC from progressing Mr Zalewski’s appeal to the Labour Court until there is further order from the court.
The court was informed that the hearing was extremely brief, lasting around 10 minutes, with the adjudication officer accepting written submissions from both sides, but Mr Zalewski was given no opportunity to cross-examine.
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Sunday Working - what employers need to know
In today’s world, the reality is that many businesses are open on Sundays, requiring employees to work Sundays.
Employers of these businesses need to be aware of the additional responsibilities that apply to Sunday working.
Employment Contracts
Where an employee is required to work on a Sunday it should be specifically stated in their contract of employment, otherwise it may be fairly assumed that Sunday is a rest day, as per the Organisation of Working Time Act.
Compensation
The Act also specifies that employees who work on a Sunday must be compensated with a reasonable allowance, increase in pay, time off, or a combination of these.
Where confusion can occur, and conflict arise, is where the Act does not specify what or how much is considered to be a reasonable allowance or increase in pay. The amount of premium paid will vary between industries and employment. However, for further guidance on what actually is considered as a reasonable premium, case law does provide useful assistance.
Some learnings from previous decisions include:
- If a premium or increased pay is being paid it should be clearly set out, ideally in the contract of employment
- A rate of pay that exceeds the National Minimum wage is not automatically sufficient.
- Full-time and part-time staff may not be treated differently with regard to a Sunday premium.
- Payment in kind is not a premium, for example providing a meal on a Sunday would not be a reasonable allowance
- If an employee is employed to only work Sundays they will still be entitled to a Sunday premium.
A specific code of practice for Sunday working in the retail sector exists, employers within this sector should ensure they are familiar with the code.
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The importance of health and safety in the workplace
A High Court Judge has awarded a Dunnes Stores Deli worker €182,000 in damages after she fell on grease on the floor of her work station. The Judge said the accident was “eminently foreseeable” therefore making the employer negligible for not providing her with a safe place to work.
The Safety, Health and Welfare at Work Acts 2005 & 2010 entail details of specific health and safety laws which apply generally to all employments.
Employer Duties
In order to prevent workplace injuries the employer is required, amongst other things, to:
- Provide & maintain a safe workplace which uses safe plant and machinery
- Prevent risks from use of any article or substance and from exposure to physical agents, noise and vibration
- Prevent any improper conduct or behavior likely to put the safety, health and welfare of employees at risk • Provide instruction and training to employees on health and safety
- Provide protective clothing and equipment to employees
- Appoint a competent person as the organisation’s Safety Officer
Employee Duties
The duties of the employees include the following:
- Take reasonable care to protect the health and safety of themselves and others in the workplace
- Not engage in improper behaviour that could endanger themselves or others
- Not be under the influence of drink or drugs in the workplace
- Undergo any reasonable medical or other assessment if requested by employer
- Report any defects in the place of work or of equipment which may be a danger to the health and safety of those in the workplace
Every employer is required to carry out a Risk Assessment for the workplace under the Act. This should identify any hazards present in the workplace, assess the risks arising from such hazards and identify the steps needed to be taken to deal with the risk. The employer must also prepare a Safety Statement which is based on the Risk Assessment, employees should be given access to the Safety Statement and the employer should review it regularly.
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Lay-Off and Short Time Working
A shortage or work, or a temporary lull in business is not an uncommon feature for many employers. However how to manage such events can be tricky.
Staffing is one of the first concerns that employers will likely need to address, particularly when cost savings need to be made.
Lay-off and short-term working arrangements are therefore popular with employers looking for a solution to a temporary issue, rather than the more permanent option of redundancy.
Lay off: A lay-off situation arises where you are temporarily unable to provide work for your employees. Lay-off could result in work halting and no pay in relevant roles, alternatively it may be a pattern such as one week on, one week off, or working three out of four weeks.
Short-time: A short-time situation arises where, due to a reduction in the amount of work available, you reduce employees pay or hours to less than half their normal weekly amount.
Redundancy
An employee who has been laid-off or placed on short-time for four or more consecutive weeks, or for an aggregate total of 6 weeks in a 13 week period, can give written notice (through the form RP) to their employer indicating their intention to claim redundancy.
Upon receipt of such notice the employer can:
- Accept and pay the redundancy lump sum thereby accepting that there is a termination of employment
- Counter notice within 7 days, confirming that within 4 weeks the employee will be employed for a period of 13 consecutive weeks.
Notifying Employees of Use Lay-off or Short-time Working
As an employer you do not have an automatic right to lay-off employees or place them on short-time working. To do so without having an express term in the contract of employment, or without an established custom and practice, may well be seen as a breach of contract, particularly if agreement is not reached with effected employees. You may also be at risk of constructive dismissal claims or payment of wages claims.
Employers who feel their business is subject to fluctuating workloads are well advised to include a lay-off and short-term clause as standard in their contracts of employment.
Additionally, good communication is highly recommended. Informing staff of the situation will not be pleasant, but they should receive clear and honest communication from management. Failure to do so will more than likely result in an extremely disengaged, unmotivated workforce, particularly when they return to normal working.
There is no minimum notice required for lay-off or short-time, however employees should be given as much notice as possible, to allow them organise their own financial situation.
Once the final decision has been made, employees should be formally notified using the Form RP9.
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