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EU Directive on Transparent and Predictable Working Conditions and its effect on existing Irish law

In June of this year, EU Directive 2019/1152 on Transparent and Predictable Working Conditions was adopted with an implementation date of August 2022. Once transposed into Irish law, the new regime will overhaul the existing standard for contracts of employments provided under the Terms of Employment (Information) Act 1994. The provisions contained under the Directive will supplement the Employment (Miscellaneous Provisions) 2018 Act; specifically addressing shortcomings regarding zero hour contracts.

The Directive’s aim is to make working conditions within the EU more predictable, introducing minimum rights, as well as creating new rules on the kind of information that must be relayed to workers regarding their terms and conditions of employment. Therefore, it follows as a corollary that this will increase the responsibilities employers to be more transparent when issuing terms of employment to their employees.

The scope of the Directive also extends to forms of employment that are often excluded, namely, housework, occasional workers, short term employees, domestic workers, platform workers, voucher-based workers, trainees, and apprentices etc. The only example of exempted workers not protected by the Directive are those whose ‘working time’ is less than 3 hours weekly across a 4-week reference period. The changes which have been made under the Directive will now be address in turn, under the following headings: (i) Terms of employment; (ii) probationary periods; (iii) limitation of outside employment; (iv) minimum predictability of work; (v) work-related training.

 

Terms of Employment

Current Irish legislation provides that an employee should be issued with their ‘core’ terms of employment within 5 days from their start date under the Miscellaneous Provisions Act which in turn is supported by the Terms of Employment (Information) Act, which stipulates that employees receive their remaining terms of employment within 2 months from their start date.

However now, under the Directive employers will be obliged to furnish a worker with a written or electronic document setting out crucial and more expansive aspects of their employment within 7 days from the commencement of their employment. These terms are as follows:

  • The employee’s grade, title, nature of work, or a brief specification of the work, place of work; or where there is no fixed place of work, the principle that the worker is employed at various places as needed or is permitted to determine his own place of work;
  • Initial basic remuneration, the method of remuneration, and the frequency of payment and the amount of paid leave allocated to the employee, or the procedures for allocating said leave;
  • The duration of the standard working day or week, where the work pattern is predictable; the number of guaranteed hours, and the remuneration for said guaranteed hours;
  • The date of commencement of the employment. The duration and conditions of any probationary period (Also amended with this Directive is that except in exceptional cases, probationary periods may be no longer than six months);
  • The procedure to be observed, eg applicable notice periods;
  • The identity of social security institutions the employer is obliged to pay on behalf of employee.

In addition to the above, any change to the mandatorily supplied information must be provided at the ‘earliest convenience’, or at latest, on the day of the change itself. A stark contrast to current regime of one month as under section 5 of the 1994 Act.

 

Probationary Periods

The Directive for the first time provides for the limitation of probationary periods in contracts of employment, prohibiting same from exceeding a 6-month timeframe. Moreover, when it comes to fixed term contracts, the employer must have regard to the proportionality of the probationary period, the expected duration of the contract and nature of the work involved when determining an employee’s probation. The Directive does however state that probationary periods may be longer than 6 months provided such is justified by the ‘nature of employment or is in the interest of the worker’.

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Under Art 15, Member States will be permitted to legislate for potential remedies which will be available to employees in circumstances where their employers fail to comply with the new regime laid out in the Directive. It will be interesting to see the knock-on effect this may have on the law of dismissals and the 12-month service requirement under the Unfair Dismissals Acts 1977-2019, potentially creating a new avenue of redress for employees with less than 12 continuous months of employment who have been terminated.

Further, under Art 12 of the Directive a worker with at least six-month service who has completed his or her probationary period (if any), may request a form of employment with more predictable and secure working conditions, where available. The employer must furnish him a ‘reasoned’ written reply within one month of the request.

 

Limitation of Outside Employment

Clauses of employment limiting the employee from taking up other employment will be much more difficult to use in future. An employer, under this Directive will no longer be able to permit the employee from taking up employment outside his or hers agreed work schedule, nor can the employee be penalised for doing so, except in the case of objective incompatibility. For instance, on health and safety grounds, confidentiality protection, integrity of public service, or avoidance of conflicts of interest.

 

Minimum Predictability of Work

The 2019 Directive also has significant implications for unpredictable work patterns. Art 10 requires that where a workers work pattern is entirely or mostly unpredictable the worker shall not be required to work by the employer, unless the following conditions are fulfilled:

  • The work takes place within predetermined reference hours and days referred to in contract.
  • The worker is informed of the work assignment within a reasonable notice period.

Where one (or both) of these conditions are not satisfied, the worker will have the right to refuse the work without adverse consequences. An employee will also be entitled to seek compensation if the employer, after a specific deadline, cancels the work assignment previously agreed with the worker.

The Directive also regulates so-called supplementary measures for ‘Zero Hour’ or ‘On Demand’ contracts. Member states who allow on-demand contracts must accept one or more of the following conditions to prevent abusive practices:

  • Limiting the use of on demand or similar contracts;
  • Will set a rebuttable presumption of the existence of an employment contract with a guaranteed amount of paid hours based on hours worked in a reference period; or
  • Will set equivalent measures that ensure the effective prevention of abusive practices.

 

Work Related Training

Also set out in the Directive is the requirement that where training is provided for the employee by the employer to carry out the work for which he is employed, it should  be provided free of cost, shall count as working time, and where possible, take place during working hours.

It is clear from the above, that there is a significant amount of work to be done in implementing this Directive into existing Irish law by August 2022. There is no doubt that the intended effect of the Directive is to address which was originally envisaged by the Miscellaneous Provisions Act 2018 by transforming and improving working conditions for all employees. It seems this Directive will have far reaching implications for employers going forward, however the extent of which remains to be seen. It is imperative that businesses are aware of potential legislation that may rise so that necessary preparations can be made in advance of its introduction.

 

 

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