Contracts of Employment

What is a contract of employment?

Anyone who works for an employer in Ireland for a regular wage or salary automatically has a contract of employment. While the complete contract does not have to be in writing, an employee must be given a written statement of terms of employment within two months of starting work.

A contract of employment is comprised of “expressed terms” and “implied terms”. Expressed terms are those expressly agreed and incorporated into the agreement by both parties at the time the contract is agreed.

An implied term refers to those terms that are incorporated into the agreement by an external source i.e., by law, collective agreement or by “custom and practice”.

The majority of employees work under open-ended contracts of employment, also known as contract of indefinite duration. In other words, the contract continues until such time as the employer or employee ends it. Many other employees however, work under fixed-term or specified-purpose contracts which are contracts which end on a specified date or when a specific task is completed.

What information should I receive?

The Terms of Employment (Information) Acts 1994 and 2001 provide that an employer is obliged to provide an employee with a written statement of terms of employment within the first two months of the commencement of employment. The statement of terms must include the following information:

  • The full name of employer and employee
  • The address of the employer
  • The place of work
  • The title of job or nature of work
  • The date the employment started
  • If the contract is temporary, the expected duration of the contract
  • If the contract of employment is for a fixed term, the details of that term
  • Details of rest periods and breaks as required by law
  • *The rate of pay or method of calculation of pay
  • The pay reference period for the purposes of the National Minimum Wage Act, 2000
  • *Pay intervals
  • *Hours of work
  • *That the employee has the right to ask the employer for a written statement of his/her average hourly rate of pay as provided for in the National Minimum Wage, Act 2000
  • *Details of paid leave
  • *Sick pay and pension (if any)
  • *Period of notice to be given by employer or employee
  • *Details of any collective agreements that may affect the employee’s terms of employment

 

*In the case of these items instead of giving each employee the details in writing, the employer may refer an employee to other documents, for example, a pension scheme booklet or a collective agreement, provided that the employee has easy access to such documents.

What if the employer gives me nothing in writing?

Your employer must give you a ‘written statement of terms of employment’. Within 5 days of commencement of work. If your employer fails to give you written details of the terms of your contract, you can bring a complaint to the Workplace Relations Commission. You must make the complaint while you are in employment or within 6 months of leaving your employment.

What if my contract contains something illegal?

A contract of employment should not contain any requirement or clause that is in contravention of Irish law. However, if there is an article in your contract which is not compatible with Irish employment law then it is invalid. The law of the State overrules any such clause.

My employer wants to change my contract/ terms and conditions, what do I do?

Changes to your contract of employment in Ireland can occur due to a change in the law, but otherwise, changes must be agreed between your employer and yourself.

If your employer is looking to change your terms and conditions, you should contact your Trade Union representative immediately.

What is a ‘fixed-term’ contract?

A fixed-term contract ends on an agreed date. The period of such a contract may range from a matter of months up to a period of a year or more.

A fixed-term contract can also be called a ‘specific purpose contract’ and so may not end on a specific date. Instead, it is agreed that the contract will finish when a particular stated task is completed, such as replacing an employee while she is on maternity leave.

Generally speaking, people employed under such contracts have the same rights as other employees. For example, employees with fixed-term contracts have the normal entitlement to annual leave (holidays), maternity leave, and wage slips. The Terms of Employment (Information) Act 1994 requires that employees with a fixed-term contract get written notice of the expiry date.

An employer must provide a fixed-term employee with a written statement as soon as possible, outlining what will trigger an end to the contract. That is, whether the contract will end on a specific date, following completion of a specific task or a specific event. In addition, where an employer intends to renew a fixed-term contract, a written statement must be supplied to the fixed-term employee not later than the date of renewal, setting out the objective grounds justifying the renewal and the failure to offer an open-ended contract.

Can I be unfairly dismissed on a fixed-term contract?

When an employee is dismissed at the end of the contract the unfair dismissals legislation applies as normal unless the employer has availed of the provision to exclude the operation of the legislation. To avail of that provision, the employer must put the contract in writing. The employer must include a clause stating that the Unfair Dismissals Acts 1977—2007 will not apply where the only reason for ending the contract is the expiry of the fixed term, or the completion of the specified purpose. Both the employer and the employee must sign the contract.

What if my employer will not give me a permanent contract?

An employee who has worked continuously for at least 104 weeks under a fixed-term or specified purpose contract may qualify for a redundancy payment when the contract ends.

If an employee who commenced employment on a fixed-term basis on or after 14 July 2003 has had two or more fixed term contracts, the combined duration of the contracts shall not exceed four years. After this, if the employer wishes the employee to continue, it must be with a contract of indefinite duration.

The Unfair Dismissal Acts 1977—2007 contain a provision aimed at ensuring that successive temporary contracts are not used in order to avoid that legislation. Where a fixed-term or specified-purpose contract expires and the individual is re-employed within 3 months, the individual is deemed to have continuous service.

What is a ‘Zero-hours’ contract?

A zero-hours contract of employment is a type of employment contract where the employee is available for work but does not have specified hours of work. If you have a zero-hours contract this means there is a formal arrangement that you are required to be available for a certain number of hours per week, or when required, or a combination of both.

How do I get paid?

The Organisation of Working Time Act requires that an employee under a zero-hours contract who works less than 25% of their hours in any week should be compensated.

The level of compensation depends on whether the employee got any work or none at all.  If the employee got no work, then the compensation should be either for 25% of the possible available hours or for 15 hours, whichever is less. If the employee got some work, they should be compensated to bring them up to 25% of the possible available hours.

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, 4 hours), whichever is the less. In this case, 4 hours is the lesser amount. If, on the other hand, you got 3 hours work out of the 20, you would be entitled to be compensated by one hour to bring you up to 25% of the contract hours.

Is there not a ban on zero-hours contracts?

Zero-hours contracts are banned in most cases but there are some exceptions.

Zero-hours contracts are allowed in the following circumstances:

  • Work of a casual nature
  • Work done in emergency situations
  • Short-term relief to cover routine absences

What is a ‘Casual Worker’?

There is no definition of ‘casual employees’ in employment law in Ireland. In reality, casual workers are on standby to do work as required without fixed hours or attendance arrangements. However, these workers are employees for employment rights purposes.

Some legislation will apply, for example, the right to receive a payslip. In other instances where a set period of employment is required it will be unlikely that a casual employee will have sufficient service to qualify. For example, 2 years’ service is required in order to be entitled to statutory redundancy.