Irish Employment Legislation Updates and Guidance

Effective from 1st July 2013, anyone who has not yet paid, or started to pay, their applicable local property tax (LPT) will have the option to have it deducted from their payroll (or occupational pension) available to them. Those who fail to submit their LPT return or fail to meet the relevant payment obligations will have mandatory deduction at source from salary or pension imposed.

 

Employers and occupational pension providers alike will be obliged to ensure this facility is available to employees from next month.
If property owners are availing of the option to have their applicable LPT deducted at source Revenue will notify the employer/ pension provider via the P2C (employer copy of the tax credit certificate in respect of the individual employee).

The relevant sum is to be deducted from the employee’s net pay.
The employer is to commence deducting the LPT once he or she has received the relevant P2C (but not prior to July 1^st 2013). The P2Cs are due to be issued to employers by mid June. The LPT to be deducted should be illustrated at the bottom of the P2C. The deductions are to be made, on a consistent basis only, over the 6 month period between July and December 2013. If the employee is paid weekly then the LPT deduction should be made weekly and if the employee is paid monthly then the deduction should be applied monthly.

For example if the LPT to be deducted is €300 then an employee who is paid weekly will see €300/26=€11.538 deducted from their weekly net salary (Any rounding should be in favour of the employee) - If an employee owing €300 is paid monthly then he or she is due to pay €300/6=€50 on a monthly basis.  Any refunds of LPT will be dealt with by Revenue – Employers are not to make any refunds of this kind.

 

If the employer receives the P2C detailing LPT after the July payroll has run then the total LPT should be deducted from August through December - the remaining 5 month period.

 

Employers will have to keep a record of the applicable LPT that they deduct for Revenue and will be required to account for the figures on the Forms P30 and P35 in respect of the employees concerned. The employer will also have to record the appropriate LPT data for employees on their payslips as well as P60’s and P45s.

Where there is a Court Order on file prior to the issuance of the P2C this will take precedence over the LPT deduction. However, if the P2C is issued prior to a Court Order being made then the LPT deduction will preside. Where the Court Order and P2C are issued or made effective from the same date the Court Order takes precedence. The LPT payment, however, takes precedence over all non-statutory deductions.

The Employer/Pension provider cannot take an instruction from the employee to stop deducting LPT from his or her salary – the employer is obliged to deduct the applicable LPT until the P2C shows that no further payment is due. If an employee would like to pay the relevant tax via a different method he or she should contact the LPT Branch and make these arrangements – then the employer will be issued with an updated P2C telling them to stop the deduction from pay/pension. Similarly if the employee feels as though there is a discrepancy in the amount of LPT they are being charged he or she should discuss this with the LPT Branch and if an adjustment needs to be made to the P2C then a revised directive will be issued to the employer.

 

According to Revenue “Where there are shortfalls due to insufficient net salary in a particular pay period(s) the employer should adjust the amount of LPT to be deducted per pay period (for the remaining pay periods in the year) to ensure the full amount of LPT is collected by the end of the year. Once this is done, the employer will not be required to notify Revenue about the shortfall. However, employers must notify Revenue in writing (e.g. by Secure Email to employersLPT@revenue.ie) where there will be insufficient income to satisfy the employee’s full LPT liability for the year, based on the expected income for the employee.”

Revenue has established a helpline for employers and pension providers alike to assist with their queries on how this LPT deduction at source will operate.

The Employer Helpline is 1890 25 45 65.

 

Effective 1^stFebruary 2014 the Single Euro Payments Area (SEPA) will standardise the processing of electronic payments in the Euro currency. The objective of SEPA is to make payments via credit transfer or debit card within the area fast, safe and efficient. The aim is that electronic cross-border payments are due to become as simple as paying with cash.

The scheme was established to overcome the technical, legal and market obstacles that exist from before the changeover to the Euro currency. The goal is to create a single market for Euro-denominated retail payments. SEPA will enable users to make cashless payments to payees anywhere within the SEPA zone using a single payment account and a single set of payment instructions.

This will allow for the easy movement of food, services and capital throughout the region. What this means is that citizens cannot only live and work anywhere in the area, but can also benefit from competitively priced goods and services, throughout the region.

The Euro currency came into effect in 1999 as an accounting currency (cash and coins were first circulated in the initial Euro currency countries in 2002). The long-term plan has always been to move away from the fragmented national payment markets and to move towards a European Union wide market that is more efficient.

SEPA will impact all citizens operating/living within its boundaries that hold a payment bank account. Those operating in participating countries will soon be able to make and receive Euro-denominated payments with a standard set of terms and conditions – regardless of whether the payments are made within or across national borders.

People will not be obliged to maintain bank accounts in any one particular country in the region to make or receive payments. An account anywhere in SEPA will be able to make or receive a Euro-denominated electronic transaction anywhere else in SEPA with ease. An Irish person living in France will not have to set-up an account in the host country to pay utilities and rent and so on electronically (as has been the case). SEPA will make life easier in this respect – People will no longer be constrained by national borders for banking and will instead be able to bank wherever suits them within the SEPA zone.

New business rules will be implemented with regard to payments. Along with this a set of common standards and requirements for issuing and executing electronic payment instructions in all participating regions will be introduced.

From 1^st February 2014 it will be compulsory for countries to withdraw existing “national only” payment standards/systems and it will be mandatory for members to migrate all electronic payments to the SEPA standards.

SEPA is being rolled out in thousands of banks in the countries and regions included in the scheme - the 27 European Union members (28 with the inclusion of Croatia in July 2013) as well as Norway, Monaco, Switzerland, Iceland and Liechtenstein. SEPA in Ireland is being overseen by the National Payments Plan (NPP) Steering Committee along with a National Payments Plan sub group which consists of representatives of the Central Bank of Ireland, Government, banks, businesses and consumers.

The European Union Commission has made SEPA migration mandatory and businesses, regardless of size, will have to make adjustments to their processes to ensure they comply with SEPA on credit transfers and direct debit payments – A lot of engagement is required with banks and advisors prior to the February 1^st 2014 deadline.

For SEPA to succeed it will require active participation from these new payment scheme users – namely public administrators, companies and consumers alike. SEPA will affect the vast majority of people and should not be overlooked. Timely migration is recommended – the deadline is quickly approaching.

When SEPA is effective the cost associated with making a payment outside of your own nation should not be any more than within your own national borders – this will be a huge benefit to both consumers and companies.

It is important to note that payments made in a currency other than Euro and to/from non SEPA countries may still attract foreign exchange charges and/or transaction fees.

Those who currently have direct debits leaving their accounts should experience a seamless transition. However, those collecting payments (the payees) of the direct debits will need to make changes to their internal systems. This is of particular importance for companies.

SEPA will have the biggest impact on companies as the standardised payment infrastructure should open up new possibilities to expand business beyond country borders. Common standards, faster settlements and simplified processing will improve cash flow, reduce costs and facilitate access to new markets further afield than before.

Like consumers businesses will need to use Bank Identifier Codes (BIC) and International Bank Account Numbers (IBAN) to identify their bank and account rather than the current identifiers (National Sort Codes and account numbers). Companies should obtain all relevant details on SEPA standards from their banks – the advice is to act quickly and to make the relevant modifications to existing systems or develop new ones without delay. Information technology system providers should be consulted from the outset as the migration could significantly impact these systems.

It is essential for companies to ensure they are informed on all relevant matters here.

 

 

 

 

 

Employees spend a good portion of their waking hours in the working environment (often with people who share similar interests to themselves) – given this it isn’t a surprise that relationships regularly develop in the workplace.

How employers deal with these relationships is the important element here. Risks for both the employer and the employees exist in these scenarios.

Some workplace relationships turn into long-term, healthy relationships where the couple are very happy with each other. However, often the situation doesn’t end on such a positive note and it can, in certain instances, create a very awkward working environment for the individuals involved as well as other members of the department who are present in the aftermath.

 

Office relationships can, at times, be a very positive thing for a business – it can encourage high levels of morale in the workplace and that, in turn, can improve standards of productivity and creativity. Unfortunately, however, workplace relationships can also have negative effects. Employee attention could be focused on the relationship as opposed to the duties of the role and this could lead to a decline in productivity or performance which, subsequently, could threaten the company’s success.

Banning relationships between colleagues isn’t the best route to take for a number of reasons (it isn’t really enforceable), however, it is absolutely essential that employers put certain policies in place in order to avoid what could result in a very awkward conclusion.

Clear rules should be devised for two employees who wish to engage in a mutual relationship. To ensure that your company avoids any hints of sexual harassment it is essential to put clear and concise guidelines in place (employers in Ireland are actually obliged to have policies and procedures on bullying and harassment in place).

It might be a good idea to have a rule that restricts employees from having a relationship with a superior in their own department, for instance, stressing that the rule is the same for all and that its function is to protect employees against sexual harassment and favouritism.

Restricting certain behaviour is absolutely paramount as inappropriate behaviour, such as public displays of affection, in the workplace is not acceptable and can compromise the internal culture of the company. Implementing strict rules that leave no room for ambiguity is advisable.

Dignity in the workplace is the right of every employee. It is imperative that you take the dignity at work policy very seriously to protect yourself, as an employer, from a lawsuit and to protect your employees at the same time.  The Employment Equality Acts 1998-2011 mean that employers are liable for harassment in the workplace. Harassment is defined as any form of unwelcome/unwanted conduct relating to any of the discriminatory grounds – gender, civil status, family status, sexual orientation, age, disability, race, religious belief and membership of the Traveller community.

Sexual harassment comes under the bullying and harassment umbrella and includes any act of unwanted verbal, non-verbal or physical conduct of a sexual nature. Sexual harassment violates a person’s dignity by creating an intimidating, hostile or humiliating environment for the person. 

It is crucial for employers to be aware that they may be held legally responsible/liable for the harassment or bullying that occurs in the workplace – even where they are not aware that this is taking place.

Employers should include an acceptable grievance or complaints outline in the dignity at work policy so that employees are not only aware of what is expected of them but what happens when they breach the policy too.

 

 

As you are probably aware three crèches between Dublin and Wicklow have come under intense scrutiny in recent days after it came to light that young children under their care were allegedly subjected to inappropriate and unacceptable treatment by staff at the childcare and early learning facilities in Stepaside, Malahide and Rathnew.

An RTÉ researcher, posing as a childcare worker, uncovered the substandard care while working at the facilities. The undercover researcher’s disturbing findings included video footage illustrating manhandling of infants and young children. The report, “A Breach of Trust”, was aired on Prime Time Investigates yesterday (Tuesday 28^th May 2013). The claims are currently being investigated by An Garda Síochána and the Childcare and Family Services unit of the HSE.

While the Prime Time Investigates programme focused heavily on three specific facilities it also highlighted failures in the entire childcare industry in Ireland. The researchers acquired a HSE inspection report that showed that a staggering 75% of Irish childcare facilities were in breach of regulations in 2012.

Minister for Children, Frances Fitzgerald, said that the HSE inspection reports into childcare facilities will be published online in the next few weeks.

Understandably, these statistics have caused uproar and have opened up a huge debate on childcare standards in Ireland. Many parents have been very upset by the recent revelations of breaches in child protection regulations. The poor practices exposed in certain crèches are likely to negatively affect the opinion held by many with regard to childcare facilities in Ireland.

These revelations will bring about intense scrutiny from parents of children in crèches all around the country. In order to protect their reputation it is absolutely vital that management take the time to ensure that all employees in crèches and childcare facilities in general are fully qualified for the roles in which they have been hired.

It is imperative that all employees working with children are vetted thoroughly and that all relevant paperwork is in place.

 

The HSE report from 2012 highlighted serious policy breaches and failures on numerous grounds like the child-carer ratio. It is imperative that employers seek advice from Employment Legislation experts if they need clarification on policies and procedures that they are required to have in place or if they need help in determining whether or not they have the appropriate paperwork on file. It is essential that all facilities are adequately staffed and that management take the necessary precautions to ensure a high standard of protection and care for children at all times.

One suggestion perhaps might be to install a CCTV system to monitor the interaction between employees and children – before doing so, however, a CCTV policy is required – again, it is essential to seek advice from the appropriate body if you are considering such a course of action.

Reports suggest that multiple employees have been suspended and that at least one employee has been dismissed by the crèches named in the report pending the conclusion of the Garda, HSE and internal inquiries.

Employers need to remember that, to avoid any risk of exposure, it is absolutely imperative to follow approved disciplinary procedures prior to disciplining employees. Regardless of the severity of the situation there are steps that need to be followed in order to ensure employers remain compliant with all Irish Employment Legislation. It is vital to follow procedures that are in line with the Labour Court recommendations to insulate your company against the risk of a future claim or fine. To avoid jeopardising the process contact an Employment Law expert prior to initiating any disciplinary action and arm yourself with the appropriate guidance.

 

 

Employee who was dismissed while on sick leave (for allegedly failing to discharge his duties as head chef and because of his unacceptable behaviour over a number of months) is awarded a sum close to €18,000 by the Employment Appeals Tribunal under the Unfair Dismissals Acts, 1977 and 2007, the Minimum Notice and Terms of Employment Acts, 1997 to 2005 and the Organization of Working Time Act, 1997.

According to the Employer the Employee in question allegedly displayed aggressive behaviour and appeared for work under the influence of drink. Reports of bullying of colleagues and name calling were filed with the Employer along with incidents of racism and other insults (for instance, calling a kitchen porter “stupid”, “slow” and “a druggie”). The Employee was also accused of throwing a knife at another member of staff - Matters the Employee refutes.

 

The Employee’s performance was called into question on a number of occasions prior to his dismissal – his failure to have adequate staffing and stock were criticized. A lack of communication and flexibility, in particular in relation to changing his time-off (for example, refusing to come to work on Good Friday when the Munster rugby team was playing) was outlined in an “Official Written Warning” on the 6^th of April (the second letter of its kind).

On the 7^th of April a dispute arose as to whether the Employee in question arrived for work “drunk”. He was instructed to get a blood test by his Employer. The Employee left the premises and sent a text message explaining that he would be on sick leave for the remainder of the week. Over the next few weeks the Employee sent numerous medical certificates indicating that he was suffering from an ulcer (the Employer was aware of this ulcer from early on in the employment).

On receipt of the “Official Written Warning” dated 6^th April (mentioned above) the Employee’s trade union sought a meeting with the Employer as the trade union maintained that the warnings had been issued “unfairly without any consultation or trade union representation”. This meeting was held on the 20^th of April in the hopes that issues between the Employer and Employee (who had previously been friends) could be resolved, however, the Employee’s unresponsiveness dissatisfied the Employer and he undertook to consult with his legal team. The Employee believed that the Employer wanted to replace him as he had advertised for a head chef the previous day (April 19^th).

On the 26^th of April the Employee enquired as to when he should return to work and the Employer replied telling the Employee to start back the following week (May 3^rd) but when the expected return date arrived the Employee again produced a medical certificate. Two days later the Employer instructed the Employee to post medical certificates and not to attend the premises, except to return keys, until the Employer had heard from his legal team.

When the Employee furnished medical certificates to cover him for the entire month the Employer wrote to the Employee dismissing him for failure to heed the warnings regarding his behaviour and for arriving to work under the influence of drink as well as throwing a knife at another staff member. 

The Employee believed the disciplinary action was taken against him as a result of a complaint that he had made to the National Employment Rights Authority (NERA) a few months prior to the dismissal.

The Employee was dismissed while on sick leave and the Employment Appeals Tribunal found that, based on the medical certificates and an endoscopist’s letter, the Employee had genuine reason for his absence. The Tribunal found that the procedures used by the Employer in dismissing the Employee were “flawed” and “deficient” because neither of the “official warnings” issued to the Employee put him on notice that his job was in jeopardy.

The Tribunal found that the Employer had not investigated the knife allegation in a “fair” manner. The Employee was dismissed without the benefit of a disciplinary hearing and without being afforded the opportunity to respond to the allegations made against him. In addition the Tribunal found that the Employee was not afforded an adequate opportunity to improve between his warning letter and his dismissal (as he was on sick leave during that period).

The Employee was awarded €14,500 under the Unfair Dismissals Acts, 1977 to 2007, €1,538 (being the equivalent to two weeks’ pay) under the Minimum Notice and Terms of Employment Acts, 1973 to 2005 and €1,691.80 (being the equivalent of 11 days annual leave) under the Organisation of Working Time Act, 1997.

In total the sum awarded to the Employee by the Tribunal was €17,729.80.

You might ask how this Employee received such a substantial award given his alleged appalling performance in the workplace...... The Employer failed to follow the correct process when disciplining, and then dismissing, the Employee and therefore left himself open to a claim under the Acts.

This was a very costly mistake on the part of the Employer and one that could easily finish a small business.

This example, along with thousands more, reiterates the significance of complying with Irish Employment Legislation and observing appropriate disciplinary procedures in order to insulate your company from the risk of a claim.

 

 

Published on Employment Appeals Tribunal Website – 29^th May 2013 – Sealed with the Seal of the Employment Appeals Tribunal. 

Source:

http://www.eatribunal.ie/determinationAttachments/indexedLiveDocs/c5e8f31a-cc9b-4ee6-8d59-1d9d7e1059ee.pdf