Ireland

Almost all Irish employment law sees a difference between an employee and an Independent Contractor. The Independent Contractor gives services under a contract for services while an employee works under a contract of service. A person carrying out work who does not easily fit into one of these two categories may be nonetheless deemed to be an employee or a sub-contractor through an employment agency. Irish Law sees the status of that person as a question of fact determined having regard to rules of legal interpretation. These are:

Actual work practices, Written evidence of terms of employment

Does the works provide his/her work for payment in performing some service from employer.

Does he/she agree to be sufficiently subject to the other party’s control.

Are the terms of the contract consistent with it being a contract of service. The Employment Appeals Tribunal (Forum for dispute resolution) applies the law as interpreted by the Irish Courts. However, it has tended to take a broader approach in defining the employer/employee relationship. It has held that the following factors are to be taken into account:

Control

Was the claimant carrying out the job on her/his own behalf? Was he/she in business on her own account?

Was there a personal obligation to perform the work?

Was the relationship between the claimant and the respondent such that would allow her/him to do other work in his/her spare time, which would be inconsistent with the status of employee?

The deemed employee. A person may be deemed to be an employee, and therefore enjoy the protection that Irish and EU legislation offers, if that person is working for an employer through another body or agency, e.g. an employment agency. It is possible that a “deemed employer” will not know the existence of the deemed employee until a problem arises.

2. How do you define an employment contract?

An employment contract will be no different from other contract to the extent that it requires the four essential ingredients of:

Offer

Acceptance

Consideration

Intention to create legal relations

The matters will arise prior to a contract of employment being entered into. These are:

Interviews

Conditions precedent:

· References.

· Medical Evidence.

· Union Membership.

· Requirements in writing.

· Terms of Employment (information) Act, 1994.

The terms of an employment contract can be implied. There are four sub-categories of implied terms.

Terms implied by statute.

Terms implied by Custom or practise.

Collective agreements.

Terms implied by law.

3. What does an employment contract need to contain?

An employment contract will also contain express terms. The principal express terms that should be contained are as follow:

Parties

Date of commencement.

Job function

Hours of work

Place of Work

Exclusive service

Probation

Term of Contract

Salary/remuneration

Company Car

Holidays

Sick pay

Pension

Retirement age

Grievance procedure

Disciplinary procedure

Restrictive covenants

Notice

Search clause

Patents, copyrights and inventions

Share options

Bulling and harassment.

e-mail, intranet and internet use

Resignation of directorship or offices on termination of employment

Proper law (i.e. when employee may be required to work abroad, the law of which jurisdiction applies)

Miscellaneous

4. Is there a legal requirement to provide an employee with a written contract and if so, when does this have to be provided?

There is no legal requirement to provide an employee with a written contract.

5. How would you define a redundancy/economic dismissal?

The Redundancy Payment Act, 1967, Section 7 (2)(as amended by Section 4 of he Redundancy Payment Act, 1971) gives a statutory definition of redundancy as follows:

(An employee who is dismissed shall be taken to be dismissed by reason of redundancy if the dismissal is attributable wholly on mainly to:

The fact that his employer has ceased, or intends to cease, to carry on the business for the purposes for which the employee was employed by him, or has ceased or intends to cease, to carry on that business in the place where the employee was so employed; or

The fact that the requirements of that business for employees to carry out work of a particular kind in the place where he was so employed have ceased or diminished or expected to cease or diminish;

The fact that his/her employer has decided to carry on the business with fewer or no employees, whether by requiring the work for which the employee had been employed (or had been doing before his/her dismissal) to be done by other employees or otherwise;

The fact that his/her employer had decided that the work for which the employee had been employed (or had been doing before his/her dismissal) should hence forward be done in a different manner for which the employee is not sufficiently qualified or trained; or

The fact that his employer has decided that the work for which the employee had been employed (or had been doing before his dismissal) should hence forward be done be a person who is also capable of doing other work for which the employee is not sufficiently qualified or trained.

6. What is the procedure that an employer must follow when making an employee redundant or dismissing on economic grounds?

There are limited procedural requirements imposed on employers in Ireland in effecting redundancy dismissal, with the exception of collective redundancies. There are no specific requirements for prior consultation or the following of procedures, such as are laid down in relation to collective redundancies. The rules of natural justice do not apply where dismissal results from redundancy.

The Irish Supreme Court has held:

The rights of an employee in regard to dismissal do not depend on whether such employee is a servant or an officer but rather on the reasons for, or circumstances surrounding, the dismissal;

Since the appellant [employee] had not been dismissed through any fault or any failure to perform her duties properly, the rules of natural justice relevant to the dismissal of a person for misconduct do not apply to her case.

The above decision was made prior to the enactment of the Unfair Dismissals (Amendment) Act, 1993, this act provides that reasonableness of an employer’s conduct is now an essential factor to be considered in the context of all dismissals, including redundancy dismissals.

An employer should take the following steps before reaching a decision that an employee is, or an employee’s functions, are, redundant:

Employers should consider all options other than that termination of employment. The consideration given to all options should be noted so that a tribunal or a Court can see, at a future date, that the employer was reasonable.

Alternative employment should be considered by any reasonable employer.

Employers should ensure that consultation takes place, either with a recognised Trade Union or directly with the employee if there is no Trade Union.

7. Do you have laws against discrimination? If so, what types of discrimination do you have and how are they defined?

Irish Legislation defines dismissals into two groups. These are:

Dismissals deemed to be automatically unfair.

Dismissals deemed to be not unfair.

Irish Legislation provides that dismissals by reasons of the following are automatically unfair.

An employee’s membership or proposed membership or activity on behalf of a Trade Union when the times at which he engages in such activities are outside his hours of work or at permitted times during his hours of work.

The race, colour or sexual orientation of the employee.

The age of the employee.

The employee’s religious or political opinions.

Where the employee is engaged in Civil or Criminal proceedings against the employer or is party or a witness to such proceedings whether they are actually threatened or proposed or whether they have made any complaint or statement to the prosecuting authorities connected with the case.

Where the employee is a member of the travelling community.
The pregnancy of the an employee or matters connected therewith (note: The provision must be cross referenced to maternity legislation).

8. Do you recognise harassment and again, how is this defined?

The Employment Equality Act, 1998, which came into force in Ireland on the 18th October 1999, prohibits discrimination on the grounds of gender, martial status, sexual orientation, religion, age, disability, race and membership of the traveller community. Harassment on grounds of gender is seen as unwanted conduct with the purpose or effect of creating an intimidating, hostile, degrading, humiliating or offensive environment.

Irish Legislation in respect of harassment on grounds other than gender is defined as any act or conduct of a person including, without prejudice to the generality, spoken words, gestures or the production, display or circulation of written words, pictures, or other material in the action or conduct is unwelcome to the person and could reasonably be regarded, in relation to the relevant characteristics of the person, as offensive, humiliating or intimidating to the purpose.

The Irish definition incorporates an objective and subjective element. It makes reference to the effect on the person.

9. What can an employee do about discrimination?

The Employee who feels that he/she has suffered discrimination can seek the assistance of an Equality Officer whose status is conferred by the Employment Equality Act, 1998.

The Employee may also bring a claim before the Labour Court, which was instituted by the same Act.

In addition, the Director of Equality Investigations may have cases referred to her. The Director investigates complaints which are not resolved in mediation and gives a decision. The decision may be appealed to the Labour Court within thirty-five days of its issue.

In cases of gender discrimination only, a Claimant may bypass the Director and Labour Court and refer the matter directly to the Circuit Court.

10. What is unfair dismissal?

The 1977 Unfair Dismissals Act provides that dismissals by reason of the following are automatically unfair:

An Employee’s membership or proposed membership or activity on behalf of a Trade Union when the time in which he engages in such activities are outside his hours of work are at permitted times during his hours of work.

The race, colour or sexual orientation of the Employee

The age of the Employee

The Employee’s religious or political opinions

Where the Employee is engaged in Civil or Criminal Proceedings against the Employer or is a party or a witness to such Proceedings whether they are actually threatened or where they have made any complaint or statement to the prosecuting authorities in connection with the case

Where the Employee is a member of the Traveller Community
The pregnancy of an Employee or matters connected therewith (note: this provision must be cross-referenced to Maternity Legislation).

11. What can an employee do about an unfair dismissal?

An Employee may be able firstly to exploit the grievance procedure which may be contained in their Contract of Service or Union/Management Agreements or work rules books.

An Employee may bring an unfair dismissal claim to a Rights Commissioner or the Employment Appeals Tribunal within six months of the date of dismissal, extendable to twelve months under a 1993 Act where appropriate.

If the Employee chooses to lodge a claim with a Rights Commissioner the Employer may object and require that the hearing be carried out by the Employment Appeals Tribunal. The time limits remain the same.

12. If a dismissal is found to be unfair, what compensation can the Employee obtain?

Unfair Dismissal Legislation provides for three possible remedies as follows:

Reinstatement

Reengagement

Compensation

Compensation is the most common form of remedy and usually preferred by the parties. Remuneration is not simply basic salary but includes “allowances in the nature of pay and benefits in lieu of or in addition to pay”.

Remuneration may be awarded under the legislation to a maximum of 104 weeks gross entitlement.

13.& 14 Do you have collective/Trade Union Law? And, if so what rights does an Employee have.

The right of an Employee to become a member of a Trade Union is guaranteed in the Irish Constitution. If an Employee chooses to exercise this Constitutional right, the Employer is not, however, under any obligation to recognise that Union or negotiate with it. What would be considered to be “Trade Union Law” in Ireland is substantially based on precedent case law. However, the Industrial Relations Act of 1990 confers immunities on workers and their representatives for industrial action but only if they are acting within what is known as the “golden formula”.

This formula provides that the actions of such persons must be “done in contemplation or furtherance of a trade dispute”. The definition of a trade dispute under the 1990 Act has, in effect, limited the right of workers to take industrial action against their own employer and nobody else.

The 1990 Act brought in new definitions of industrial action and “strike”.

15. Does the employer have to accept collective trade union law?

As outlined above the employer is under no obligation to recognise a trade union or negotiate with it. However, should a trade union be in existence and act in full compliance with common practice recognised by the Irish Courts as lawful, as well as with the terms of the Industrial Relations Act, 1990, then an employer may find that he must deal with the actions of a trade union and seek redress by way of an injunction from the High Court.

Over the last 15 years or so, the interaction between large employers and trade unions has been shaped by what is known as “social partnership”. This partnership is a process by which the government and its agencies attempt to resolve potential conflict before industrial action is taken by either side.

16. Can any individual from another country come and work in your country?

Based on the principal of the free movement of labour as between E.U. Nation States, an individual from another E.U. State can come and work in Ireland. However, if the individual is from a non-E.U. Country, they can work in Ireland only if they have the appropriate Work Permit.

17. If so, are there immigration controls/work permits that need to be applied for?

The non-E.U. individual who wishes to work in Ireland requires a work permit to do so. This work permit is issued to the employer and is specific to the particular job to be carried out by the non-E.U. individual/employee for that particular employer. Therefore, the prospective employer in Ireland must contact the department of Enterprise Trade and Employment if he/she wishes to employee a non-E.U. national for a particular job.

18. What criteria are used for any such applications?

The primary criterion is the non-availability of local labour for a particular job.

19. What does an employer have to do if he receives an application for a job from somebody who is not a national in your country?

If the applicant is an E.U national, the employer is entitled to employ that individual. If the applicant is a non-E.U. national, then the employer must apply to the Department of Enterprise, Trade and Employment, as outlined above, for a work permit, which permit will be referable to that specific person to do that specific job.

20. What is the tax position for a foreign employee?

A foreign employee will be treated in the same way as a local or native employee for tax purposes. All labour taxes lawfully falling due in respect of an employee will apply to the foreign employee also. Accordingly, the employer of a foreign employee will be obliged to pay the Pay Related Social Insurance for that employee in the normal way. Furthermore, the employee is obliged to insure that his/her income tax is paid on his earnings in the same way as a local employee.

21. Are employees protected in the event of a sale or a purchase of a business?

Yes. The provisions of the Transfer of Undertakings Directive (77/187/EEC) provides for “the protection of employees in the event of a change of employer, in particular to ensure that their rights are safe guarded”.

In effect, the directive now obliges the new owner of a business to enter a contract of employment with an employee who is working in the business at the date of transfer. This obligation directly contradicts the common law principals governing the creation of contracts of any kind.

22. If so, what rights do employees have and what can they do about it?

The employees (individually or trade union) can bring a claim before the employment appeals tribunals. The Employment Appeals Tribunal has taken a wide purposive approach.

One of the most effective remedies for an employee is to obtain injunctive relief preventing any steps being taken in the transfer by either or both of the transferor and transferee until the employee’s rights under regulation 7 are honoured.

23. What does the employer have to do in the event of a sale or a purchase of a business which includes employees?

The employer must be aware that the rights and obligations of the Transferor arising from a contract of employment or from an employment relationship existing on the date of a transfer shall because of this transfer, be transferred to the transferee.

The issues in determining whether a transfer has taken place will be:

· Change of ownership.

· Contractual nexus between transferor and transferee.

· Transfer of activity.

· Stable economic entity.

· Assets or resources.

· Transfer of goodwill.

· Existence of organisational structure or organised grouping of resources.

Article 6 of the directive takes up all of section 3 of the directive and is headed “information and consultation”. It confirms joint obligations on the transferor and the transferee to inform employee representatives of the reasons for transfer, the legal, economic and social implications of the social implications of the transfer on the employees, and of any measures envisaged in relation to the employees. This information must be given in good time before the transfer is carried out and, in any event, before the employees are directly affected by the transfer “as regards their conditions of work and employment”.

The Irish Regulations provide a method of notifying the employees directly when they do not have representatives.

Having formed the preliminary intention to transfer the undertakings the transferor and the transferee must at an early stage have regard to their obligations under article 6 and regulation 7 and carry out detailed preparatory work to ascertain the full nature and extent of the obligations arising under the directive and regulations consequent on the proposed transfer.

What is the position regarding agents in your country, briefly outline how agents are dealt with and what documentation is required?

The European Communities (Commercial Agents) Regulations 1995 (FI33/1994) and 1997 define a Commercial Agent as

“a self-employed intermediary who has continuing authority to negotiate the sale or purchase of goods on behalf of another person, hereinafter called “the principal”, or to negotiate and conclude such transactions on behalf of and in the name of the principal”.

Where Agents come within the above definition, the Contract shall be invalid unless reduced to writing. If an Agency Agreement is not covered by the regulations, then they are subject to the normal rules of Contract.

The regulations outline the duties of the principal as follows:

Give his agent the required documentation regarding the goods concerned. What is required will depend on the circumstances of each case.

To alert the Agent within a reasonable time once the principal expects that the amount of transactions will be considerably lower than that which the Agent would otherwise have expected.

To obtain the information required for the performance of the Contract by the Agent.

To inform the Agent within a reasonable time of his refusal, acceptance and of any non-execution of a commercial transaction which the Agent has procured for the principal. Principals which fall outside the scope of these regulations are not under any similar duty under Irish Law.

The Principal must act in good faith.

The regulations define the Agent’s duties as:

(i)

He must share with his principal all required information available to him.

(ii)

He must make reasonable and proper attempts to negotiate and, where appropriate, conclude the transactions which he has been instructed to effect.

(iii)

He must adhere to the reasonable instructions given by his principal.

(iv)

He must act in good faith and dutifully and look after his principal’s interests.

Article 5 of the Regulations prohibit any derogation from the duties of both parties.

Ciara Farrell

Farrell & Partners

Ireland