Important Employment Legislation Updates - Construction Wages; Gender Pay Gap; Data Protection
1. New agreement on pay and conditions for construction industry workers
The first Sectoral Employment Order (SEO) under the Industrial Relations (Amendment) Act 2015 was signed into law on 19 October 2017 (the Construction Sector Order) with immediate effect. This Order fixes the statutory minimum pay, pension entitlements and sick pay entitlements for a number of categories of employees in the construction sector.
The Construction Sector Order is the first SEO under the revamped industrial relations legislation (Industrial Relations (Amendment) Act 2015 (the 2015 Act). It replaces the Registered Employment Agreement (REA) which applied to this sector until the Supreme Court decision in McGowan and Others v the Labour Court Ireland and Anor in 2013 which invalidated the REA process as unconstitutional The 2015 Act now provides a revised legislative framework for REAs, SEOs and Employment Regulation Orders.
What is a SEO?
A SEO sets out minimum pay rates as well as pension and sick pay scheme entitlements for a specific economic sector. They differ from REAs in that they are universally applicable to a particular sector.
Who does the Construction Sector Order apply to?
This SEO applies to a wide variety of employees in the construction sector, including: (i) operatives (general and skilled), (ii) general craft workers and (iii) apprentices in numerous trades (e.g. bricklayers, stone-layers, carpenters and joiners). It applies to all employers of such workers including agencies.
What does it provide?
The Construction Sector Order fixes new rates of pay for these workers. The new rates represent an increase of approximately 10% on the rates that had applied in the earlier REA. In determining these rates, regard was had to the criteria under the 2015 Act which permit the Labour Court to take into account comparators in that sector (which can comprise both unionised and non-unionised employers).
The Construction Sector Order also provides for: (i) pension benefits on no less favourable terms than those in the Construction Workers Pension Scheme; (ii) a mandatory sick pay scheme with terms comparable to the Construction Industry Sick Pay scheme; and (iii) a higher pay rate for unsocial hours. It does not provide for any travel allowance for workers as the Labour Court indicated there were a number of legal and technical issues around this which are being pursued separately.
Dispute resolution procedure
Significantly, no industrial action can take place until the dispute resolution procedure in the Construction Sector Order has been complied with.
Action points for employers
Employers in the construction sector need to review their payroll systems to ensure compliance with the new rates set by this SEO. If employment contracts or policies provide for pay rates which are less than that provided by the Construction Sector Order, these rates are now substituted by the new rates.
There are certain exemptions from the new rates which struggling businesses may apply for but majority employee consent is required before such exemptions will be granted.
2. Gender Pay Gap developments
Legislation in relation to the gender pay gap (GPG) continues to progress towards enactment.
Click here for our earlier alerter to recap on the background to the GPG in Ireland. The Irish Human Rights and Equality Commission (Gender Pay Gap Information) Bill 2017 passed Committee Stage in the Seanad on the 25th October 2017. It will now be scheduled for Report and Final Stage in the Seanad before going to the Dáil. We will continue to monitor and update on its progress.
3. General Data Protection Regulations (GDPR) update
The EU General Data Protection Regulations come into effect on 25 May 2018 bringing maximum fines for data protection breaches of up to €20million or 4% of global turnover, whichever is the higher. Employer obligations regarding data protection will be much increased and more onerous. Click here for our note on GDPR.
The Data Protection Bill 2017 is designed to give effect to, and provide for Irish derogations from, the GDPR. The General Scheme of the Bill was published in May 2017. The Bill is still at a preliminary stage. Currently the most significant parts relate to the new powers of the Office of the Data Protection Commissioner and enforcement procedures. Given that the Bill it is likely to change considerably before enactment we will continue to update and advise on evolving developments under the new GDPR regime.
Date Published: 27 October 2017