Farm Ireland

Wednesday 17 January 2018

Know your labour law

Are you leaving yourself open to legal action?

Table 1: PRSI and USC
Table 1: PRSI and USC
Table 2: Minimum wage
Table 3: Board and lodging

Darragh McCullough & Aidan O'Boyle

Last week we looked at some of the responsibilities that farmers take on when they decide to employ somebody, either on a temporary or more permanent basis. The initial steps that are required were outlined, including registration of the employer and employee, and tax returns for both parties.

This week we are going to outline the other charges every employer is obliged to deduct from their workers' wages, what the minimum wage rates are, and the laws that govern this potential legal minefield.


In most cases, employees or their employers will be liable for Pay Related Social Insurance (PRSI) and the new Universal Social Charge (USC), subject to income exemptions. The PRSI and USC rates for this year are based on current draft legislation, as seen in table 1.

The Government has proposed an amendment to the 2011 Finance Bill to limit the USC top rate charge to 4pc for all medical card holders. There is also a proposed amendment whereby self-employed persons earning more than €100,000 will pay an extra 3pc on the excess.

Minimum rates of pay

The minimum wage is higher for agriculture than the general minimum wage. This is set out in an employment regulation order, which was updated on December 31. The rates are in table 2.

An Experienced Adult Worker will be over the age of 18 and have completed the three-month probationary period.

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Task workers

In the case of workers being paid on task or a productivity basis measured in units of output or weight, it is the employer's responsibility to ensure that the average hourly rate of pay does not fall below the minimum rate. To calculate this, the employee's earnings are divided by the hours of work to calculate the average hourly pay rate.

The maximum length of reference period that can be used for this calculation is one calendar month. If the worker's earnings fall below this rate, the employer is obliged to top up the earnings.

Weekly hours

The normal hours of work for workers covered by the Employment Regulation Order will be a maximum of 48 hours per week. However, the hours of work may exceed 48 hours per week where the average number of hours worked over six months does not exceed 48 hours per week. Workers are entitled to at least one day off in a seven-day week and every third weekend off. Employees are entitled to time and one third for overtime or work on a Sunday. Employees are also entitled to 8pc of their time worked in holidays every year up to a maximum of four weeks. A worker with eight or more months' service is entitled to an unbroken period of two weeks' annual leave. Public holidays and periods of illness will be disregarded in the calculation.

Board and Lodging

If a worker receives board and lodgings, board only or lodgings only from his/her employer, the amounts in table 3 may be deducted from his/her pay.


In Ireland, employers who do not currently operate a pension scheme for their employees, or who operate an occupational pension scheme with limited eligibility for membership or retirement benefits, are generally required to provide employees with access to at least one standard Personal Retirement Savings Account (PRSA) where contributions can be made by payroll deduction.

Your insurance company will usually be able to facilitate you in this regard by putting you in contact with its local pension specialist.

Employment Law

There is a substantial amount of employment law in this country, governing rights such as wages, holidays and public holidays, working hours, redundancy, dismissal, and notice regarding termination of any employment arrangement. A lot of the rights arising from this law are governed by the National Employment Rights Authority (NERA), which provides information to employees and employers through its information unit, monitors employment conditions through its inspection services and can enforce compliance and seek redress.

NERA has around 90 inspectors, each of whom has the following powers:

  • To enter any premises at a reasonable time;
  • To demand sight of records;
  • To inspect records;
  • To take copies of records;
  • To interview and require information from any relevant person.

Where a breach of Employment Rights legislation has been identified, NERA's Inspection Services' primary role is to seek compliance with the legislation and rectification of the breach. This includes redress for the employees concerned and payment of any arrears due.

In certain circumstances, including where the employer fails to rectify the matter, where breaches of the Protection of Young Persons (Employment) Act 1996 have been detected, or where serious breaches of employment rights legislation have been detected, NERA's Prosecution Services refer the matter to the Chief State Solicitors Office with a view to initiating a prosecution in the courts, subject to their advice.

The Enforcement Services Unit can seek to have a determination of the Labour Court or the Employment Appeals Tribunal enforced through the Courts Service in certain specific circumstances.

Generally, where such an award is made in favour of an employee, the employer has six weeks to implement it. If they fail to do so within this period, the employee or the employee's trade union may make an application to the courts for an order directing the employer to carry out the determination.

Where they are not in a position to do so they can refer the matter to the Enforcement Services Unit, which may make an application to the courts for an order on their behalf.

Next week, we'll talk to Peter Byrne of FRS and Tom Bermingham of Farm Solutions about the options they provide for farmers.

Aidan O'Boyle is a manager in Grant Thornton's taxation unit

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