Some UK businesses may decide to establish or expand their footprint in Ireland post Brexit. If you intend to take that step it is worth noting the key differences in employment law. Contributor Sinead Morgan Senior Associate – DWF Dublin.
Since the announcement that the UK were going to “Brexit” from the EU there have been ongoing discussions as to the possible impact that this might have on their closest neighbours, Ireland. Some believe that it will be extremely detrimental whilst others see it as an opportunity for business growth given that some companies are likely to want to establish a presence in the only other English speaking country in the EU post-Brexit. There have already been announcements from the Bank of Ireland, Barclays Bank and JP Morgan of their intention to expand their Irish operations.
Differences in employment law
Although UK and Irish employment law have primarily emanated from EU Directives, there are substantial differences between employment laws in the two jurisdictions. Many UK employers are surprised by these differences and the impact that they can have on their business models. Some differences are subtle while others are more dramatic. We regularly advise HR departments on the key differences between the two jurisdictions to allow them to harmonise terms while ensuring compliance with local law.
The key differences are as follows: Minimum terms /Employer obligations; Some of the key differences in relation to minimum terms and conditions are highlighted below: Minimum Wage – Ireland €9.55 per hour from 1 January 2018. UK £7.83 per hour (over 25s) from 1 April 2018.
Irish employers have no obligation to contribute to an employee’s pension, just to allow access to a pension scheme. Irish employers have no obligation to pay sick pay. It is open to Irish employers to provide a sick pay scheme on a contractual basis.
Nine public holidays versus eight public holidays in the UK, with the days differing in some instances. Differences in the employers’ notice obligations rising from 1 week to 8 weeks’ after 15 years’ service in Ireland; versus between 1 week and 12 weeks’ after 12 years’ service in the UK.
The nine grounds under equality law in Ireland differ slightly from the UK and are as follows: Gender, civil status, family status, sexual orientation, religious belief, age, disability, race (including nationality, colour or ethnic national origins), and membership of the travelling community.
Terminations/Disputes
Redundancy packages in Ireland are substantially more lucrative than in the UK, which can become a bone of contention. Statutory repayments are 2 weeks’ per year of service plus a bonus week’s pay. The weekly wage is capped to €600. Most importantly, unlike the UK the total redundancy payment has no cap. Ex-gratia payments are also common in Ireland.
Employees require 12 months’ service to bring an unfair dismissal claim compared to the 2 years’ service required in the UK. Sanctions of reinstatement, re-engagement and/or compensation up to a maximum of 2 years’ gross remuneration can be applied.
Senior executives in Ireland often seek interlocutory injunctions to restrain disciplinary processes or dismissals. The risk of injunction applications is far higher in Ireland than the UK. In transfer of undertakings situations, TUPE does not automatically apply to a service provision change unlike the UK.
The Workplace Relations Commission (“WRC”) operates as the Court of First Instance with appeals going to the Labour Court. The WRC is typically less procedural than the Employment Tribunal system with very little pressure on Claimants to set out their case in detail prior to the hearing date.
We would always recommend employers to take local advice when expanding into a new territory, harmonising terms across jurisdictions or dealing with a dispute in a new jurisdiction.
