A Collection is a selection of features, articles, comments and opinions on any given theme or topic. It allows you to stay up‑to‑date with what interests you most.
Login here to access your saved articles and followed authors.
We have sent you an email so you can reset your password.
Sorry, we had a problem.
Tags related to this article
Published 4 febrero 2021
This article was originally published in Hospitality Ireland.
This year has seen businesses in Ireland and around the world face unprecedented challenges and the hospitality sector, in particular, has been significantly affected. Given the enormous financial impact of the pandemic, it is not surprising that many employer questions relate to their options in keeping and minding their staff and at the same time seeking to protect their businesses.
We address a number of common queries and concerns. Frequent changes to restrictions and associated guidelines mean that the employer response has been subject to change. At the outset of the pandemic many businesses faced questions, for example, concerning lay-off, for the first time and with an unprecedented urgency. They will have again faced these questions during the varying levels of the government’s response since March 2020. Decisions have had to be made quickly and with less focus than normal on the fundamental legal questions. This is understandable.
In writing this note we canvass some of the issues at a high level, while appreciating that we are living in extraordinary and unprecedented times and that employers, it must be said, have taken as much care as possible in continuing to foster staff wellbeing and the employment relationship. The summary below is intended for information purposes only and detailed advice should be sought in respect of specific queries.
The Employment Wage Subsidy Scheme (the “EWSS”) was introduced to replace the Temporary Wage Subsidy Scheme (the “TWSS”) from 1 September 2020. The EWSS is expected to continue until 31 March 2021. The qualifying criteria for the EWSS differ from the criteria that previously applied for the TWSS and a separate registration system applies. The key criterion is for employers to demonstrate an expected COVID-19 related 30% reduction or more in turnover or customer orders between 1 July 2020 and 31 December 2020 (looking at the period as a whole rather than on a monthly basis).
The reduction in turnover or orders can be relative to:
Employers must review continuing eligibility on the last day of every month (other than July 2020 and the final month of the scheme) and must withdraw from the scheme if they no longer meet the criteria. They must also ensure that they have continuing tax clearance from Revenue.
The subsidy rates from 20 October 2020 to 31 March 2021 are as follows:
Some employers are not eligible to participate in the EWSS. Alternatively, they may opt not to avail of it in respect of some or all of their impacted employees. Employees may instead be entitled to social welfare payments, including in accordance with new social welfare schemes introduced in response to the COVID-19 crisis, subject to any applicable requirements relating to means testing and/or PRSI contributions. These include of course the Pandemic Unemployment Payment and also short term work support although applying for these and other supports are largely matters for the staff themselves as opposed to the employer.
In short, the options include redundancies, lay-off and/or short-time. Employers have of course been encouraged throughout this pandemic to avoid the former and focus on the latter two. Other options include unpaid career breaks or forms of statutory leave and, initially at least, expediting the taking of annual leave. This note focuses on lay-off and short-time.
Lay-off or short-time arrangements have been partly facilitated by the rapid development of wage support and other schemes (including the EWSS) and some other legislative changes. Employers have been able to preserve more employment relationships than would otherwise have been the case, while of course many roles have unavoidably been made redundant.
Wage subsidies can apply even where businesses implement temporary lay-offs or reduce working hours.
Lay-off in this context is a term used to refer to a temporary period during which the employee does not work - and may or may not, depending on the circumstances, receive some level of pay. Short-time strictly speaking means working less than half normal hours, although many employees’ hours have been reduced to a different degree. The employer in either case must reasonably believe that the situation will not be permanent and notice must be provided to employees.
There is no minimum period of notice required, but notice should be reasonable in the circumstances. Notice during the pandemic has been much shorter than it would otherwise have been the case. But is the employer entitled to take these measures at all?
Firstly, some businesses have been well placed in terms of their contractual documents to implement such changes. Ideally businesses can rely on a clause in the written contract permitting lay-off without pay or hours reductions with corresponding pay reductions.
Secondly, in the absence of such documentation many employers will have relied on what can be broadly termed “custom and practice”. This may be defensible and has, even before the pandemic, been upheld in certain circumstances but specific advice should be sought.
Thirdly, many businesses which have not provided for lay-off or short-time in their contracts or which do not consider it to apply by reason of custom and practice, will have decided to ultimately reduce legal risk by seeking staff agreement to the measures, in the expectation that this is temporary and will avoid dismissals.
The law on implementing such measures may not have changed by reason of the pandemic, save in a limited way as set out below in relation to staff themselves triggering redundancies. There are potential risks in laying off staff or reducing pay otherwise than in accordance with the written contract or employee agreement. One might, perhaps rightly, expect forbearance but employers should exercise care. While they must be practical and consequently may proceed in any event to introduce such measures, they must be alive to the risks, including potential claims for lost salary payments.
Leaving aside the method used and justification relied on, another risk arises in relation to discrimination. In selecting employees for lay-off or short-time, employers should ensure that they apply reasonable and objective selection criteria and do not discriminate against employees on any of the nine protected grounds: gender, civil status, family status, sexual orientation, religion, age, disability, race, or membership of the Traveller community.
An employer can implement redundancies in the normal way, notwithstanding the COVID-19 pandemic. This is sometimes not appreciated by employees and employers alike. Legislation has been enacted to assist businesses by suspending the right of employees to claim redundancy where they have been placed on lay-off or short-time as a result of COVID-19, but there is nothing in the legislation prohibiting an employer from making employees redundant in the usual way.
The suspension of the normal right of an employee to claim redundancy from their employer (after 4 weeks of being laid off or placed on short time, or 6 weeks within a period of 13 weeks) was introduced on 13 March 2020 and has been extended a number of times, most recently until 31 March 2021.
Whether or not an employee is entitled to be paid will depend on his/her contractual entitlement to sick pay and the company’s policy on sick leave/sick pay. The position is not altered by the COVID-19 pandemic and there is no statutory requirement for an employer to pay an employee in these circumstances.
An employee will be required to self-isolate including where they have symptoms of COVID-19 and are awaiting a test appointment or test results. This means they are unable to attend the workplace. There is no statutory obligation to pay an employee who is self-isolating unless they can work from home in which case they are of course entitled to be paid in the normal way.
There are situations in which an employee will be required to restrict his/her movements and will be unable to attend work. For example, if an employee is a close contact of or lives with someone who has tested positive for Covid-19, but does not have symptoms themselves. Another example is where they have arrived in the State from a country other than Northern Ireland or a “green region” in accordance with the new EU “traffic lights” approach. There are exceptions to this including essential business travel and critical occupations and all subject to specific rules and guidelines. Again there is no statutory obligation to pay an employee unless they can work from home.
In general there is no statutory requirement for an employer to pay an employee who needs to care for someone else, but an employee may be entitled to unpaid carer’s leave.
An entitlement to paid leave will, however, arise where, for urgent family reasons, the employee’s immediate presence is indispensable to care for a close family member, that is a child, spouse/partner, parent, grandparent, sibling, or person to whom the employee has a duty of care or is in a relationship of domestic dependency. This is known as “force majeure” leave. An employee is entitled only to a maximum number of 3 days of such paid leave in any 12-month period or 5 days in a 36-month period. Due to the requirements of urgency and immediacy, force majeure leave is unlikely to apply to consecutive days of absence in most cases and prior approval cannot generally be sought.
This is a difficult and uncertain time for employers and employees alike. Employers are advised to maintain communication with employees and to keep them aware of developments that affect or are likely to affect their employment. There is risk around lay-off and hours reductions and these cannot be completely excluded in many cases, but at the same time may be of concern for the employer. Questions can also arise in relation to differing treatment of staff and whether or not any act or omission by management in relation to any member of staff could potentially constitute unlawful discrimination e.g. in terms of selection for pay reductions, hours reductions, assigning particular shifts or hours or patterns of work, or providing any access to any employer enhancements or supports.
Employers should re-familiarise themselves with their employees’ contracts of employment and their policies and procedures in adopting a strategy or strategies to retain staff and at the same time seek to reduce risk, always with business concerns and practicality at the forefront of the decision making.
+ 353 (0)123 19647
+353 1 231 9686
Aidan Healy, Jenny Wakely, Aisling Parkinson
James Colville, John Sheehy, David Kennedy
Lisa Broderick, Rowena McCormack, Julie-Anne Binchy, Charlotte Burke, David Freeman
Kate Sheppard, Deirdre Nally
Barry Reynolds, Jenny Wakely
Lisa Broderick, Rowena McCormack, Julie-Anne Binchy
Deirdre Nally, Kate Sheppard
Ronan McLoughlin, Sinéad Hennessy, Rowena McCormack, Julie-Anne Binchy
John Darmody, Sharon McCaffrey, Sarah Meehan