10 things employers need to know about Irish labor and employment laws
Considering expanding your business to the Republic of Ireland? With its highly educated workforce, access to the European market as an EU member state, and low corporate tax rates, it’s a great choice.
Before you open a branch in Ireland, however, it’s crucial to be aware that Irish employment law isn’t so much a uniform body of legislation; rather, it’s a maze of Acts, Codes, and other regulations that protect employee rights and require a good deal of expertise to ensure compliance.
In this guide, we’ll review the top 10 things employers should know when opening a company in Ireland. We’ll also answer some frequently asked questions so you go into your new venture prepared.
1. At-will employment doesn’t exist
Irish laws do not recognize at-will employment. If an employee has been with your company for at least 12 months, not providing them with a reason for the termination and the proper notice period will be considered unfair dismissal and could land you in legal hot water.
2. Misclassifying employees can result in serious legal consequences
Employees work under contract for an employer and are entitled to statutory benefits, including paid sick leave, maternity leave, and workers’ compensation insurance. Self-employed independent contractors, however, are not entitled to any benefits, have a high level of control over their own work, and are not directly supervised by a company manager.
Misclassifying employees as independent contractors can result in misclassification penalties by the Revenue Commissioners—the government agency that oversees taxation and related matters. These penalties can include 10 years of jail time, back taxes, interest, and associated fines, which could amount to as much as €250,000.
Employees work exclusively under the direct supervision of an employer for an indefinite time period and are entitled to benefits. Contractors are self-employed, work autonomously for a fixed time period, and are not entitled to benefits. Conflating these worker categories can result in misclassification penalties. This comes with fines, backpay, and retroactive benefits administration (with interest).
3. Ireland has strong anti-discrimination protections
The Employment Equality Acts 1998-2011, enacted by the Workplace Relations Committee, take a hard line against any form of discrimination in the workplace. Under these Acts, employers may not discriminate against would-be or current employees in the following areas:
- Promotions
- Pay
- Work experience
- Access to employment
Discrimination due to disability, age, race, religion, gender, membership of the traveller community (a group of nomadic peoples called Travellers in Ireland), sexual orientation, or civil or family status is also prohibited under the Employment Equality Acts 1998-2011.
4. Not all employees are entitled to redundancy pay
At times, companies find themselves in an economic quagmire that forces them to file for bankruptcy. At others, businesses must reorganize themselves to either save money or ensure they can compete with other companies in the same industry. In many of these cases, at least some employees find they’ve been made redundant—in other words, they’re being dismissed because their job is no longer necessary. While this is a justified reason to dismiss an employee, only workers who have been with the company for at least two years are entitled to receive redundancy pay. They’ll receive two weeks of pay for each year of service in one lump sum.
5. Irish workers have the right to unionize
Under the Irish Constitution, employees in Ireland have the right to join or leave the trade union of their choice. Ireland’s employment law protects them from being dismissed from their jobs or discriminated against for their trade union activities. To further provide employment protection, the Irish Congress of Trade Unions—the umbrella organization that oversees all trade union activities, from memberships to campaigning and collective bargaining on behalf of workers—keeps all applications and the names of members confidential.
6. Ireland offers special leave to carers
If an employee is the caretaker of a person who is entirely dependent on them to look after them, Irish employment law offers a special program called Carer’s Leave. The leave is both temporary and unpaid, but employers must leave the individual’s position open for them until they return. Carers can take leave for a minimum of 13 weeks; the maximum amount of time is 104 weeks.
7. NDAs are currently under legislative review in Ireland
Non-disclosure agreements (or NDAs) have long been used to protect trade secrets, intellectual property, and other material crucial to a company’s success. However, in 2021, the Workplace Relations Committee added an amendment to the Employment Equality Acts 1998 to prevent victims of sexual harassment, discrimination, employees involved in whistleblowing, and others from reporting incidents to the appropriate authorities.
8. Employers are responsible for workplace health and safety standards
The Safety, Health, and Welfare at Work Act 2005 sets out responsibilities for employers and employees alike to ensure everyone enjoys a safe and healthy workplace. The health and safety standards for employers are as follows:
- Training team members on health and safety
- Supervising employees to ensure they are healthy and safe and putting a stop to any behaviors that put workers at risk
- Providing PPE to employees when necessary
- Designating a competent safety officer
- Ensuring the workplace is safe and employees are protected from harmful noises and physical agents
9. Employers are responsible for employee data protection
As a member of the European Union, Ireland must comply with the General Data Protection Regulation (GDPR), an EU directive that regulates the use of sensitive, personal information given to employers by employees. This strict set of data protection rules governs, among other things, the accuracy of employee records, fairness and transparency, informed consent, and the security standards employers must follow to prevent data breaches.
10. Employers are required to provide employees with specific information under the Terms of Employment (Information) Act 1994
Under the Terms of Employment (Information) Act 1994, employers are legally required to provide their employees with specific information about their jobs. This includes an official contract of employment, their hours of work, a description of their role and duties, their pay, the name and address of the employer, their start date, the duration of the contract, and the duration of the probationary period.
Frequently asked questions about Irish labor laws
What is the minimum wage in Ireland?
Under the National Minimum Wage Act–a piece of employment legislation enacted back in 2000–the majority of Irish employees are entitled to the statutory minimum wage. As of January 1, 2023, this is €11.30 per hour for workers over the age of 20. For workers aged 19, the minimum hourly wage is €10.17; for workers who are 18, it’s €9.04 per hour.
The national minimum wage is expected to increase by €2 per year in 2024 and 2025.
What are the overtime laws in Ireland?
The Organisation of Working Time Act 1997 set the laws and regulations surrounding working hours, overtime, and rest periods. On average, the Irish working week is 48 hours. It’s important to note that while a worker may find themselves at their place of employment for more than 48 hours one week, when all the hours they worked that month are averaged, the number should come out to 48.
The Organisation of Working Time Act 1997 also has strict rules about rest periods. All employees are entitled to a 15-minute rest period after 4.5 hours of working. They get a 30-minute rest period when they’ve been working for 6 hours.
Finally, although employees who work on Sundays are entitled to benefits like extra pay, employers are not required to compensate workers who work overtime on any other day of the week. With that being said, many choose to pay employees who work overtime extra anyway or compensate them with additional days off in order to remain competitive and attract top talent.
If that sounds tricky to monitor, Rippling EOR will automatically track hours and give your Irish employees the correct overtime rate.
What are the required benefits in Ireland?
All full-time Irish employees are entitled to the following statutory benefits:
- Pension schemes/retirement contributions
- Workers’ compensation insurance
- Sick leave (which includes sick pay)
- Maternity leave
- Paternity leave
- Adoption leave
- Vacation entitlements
- Public holidays (there are 10 public—or bank—holidays each year)
Irish employees are entitled to at least four weeks of annual leave each year. Some employers choose to give more; the employees’ entitlement to paid annual leave should be spelled out clearly in their contract of employment.
Additionally, a word on pension schemes: While employers aren’t required to include company-provided pensions in their initial benefits package, if they choose not to, they must offer at least one Standard PRSA (personal retirement savings account).
For more information on mandatory benefits in Ireland, read our complete guide.
How do I terminate employees in Ireland?
As mentioned earlier, Irish employment law prohibits at-will employment. To avoid legal trouble, it’s crucial to be aware of how to terminate employees in Ireland, even though it’s probably the last thing on your mind right now.
Under the Unfair Dismissals Act 1977, termination of employment is considered unfair unless it falls under one of the following categories and the employer can prove they had “fair grounds”:
- Incapability: No matter how qualified the employee is on paper, if something is interfering with their ability to do their job—such as chronic absenteeism—and they’ve failed to change their behavior despite receiving written warnings, you can dismiss them.
- Incompetence: At times, such as when their duties change or when they’re promoted to a new position, you may find your employee is simply not up to the job. If they’ve worked for you for two or more years and continuously fail to improve despite your (and their) best efforts, incompetence is fair ground for termination of employment.
- Misrepresenting qualifications: If you find out a new employee lied on their resume to secure the job, you’re legally permitted to terminate their employment.
- Improper conduct: This broad category includes everything from small, also called “ordinary” instances of misconduct—such as taking an unauthorized vacation from work—to gross misconduct. The latter involves serious charges, such as stealing from the company, threatening other employees, and harassing coworkers. In the former instance, Irish employment law dictates you must try to solve the situation before terminating the employee. In the latter, however, employees guilty of gross misconduct can be terminated immediately without any notice period.
- Redundancy: At times, businesses make changes, such as a top-down reorganization, that render some workers’ jobs redundant. Redundancy is considered fair grounds for dismissal in Ireland.
To learn more about termination of employment, the Unfair Dismissals Act 1977, redundancy pay, notice periods, and more, read our guide on terminating employees in Ireland.
Hire and onboard Irish employees with Rippling
If you're hiring employees, independent contractors, or remote workers in Ireland, you need Rippling.
Rippling allows you to manage HR, IT, and Finance in one unified system. We make it easy to onboard, manage, and pay employees and contractors around the world—in a single system that helps keep you compliant with local employment laws and regulations.
Rippling and its affiliates do not provide tax, accounting or legal advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any related activities or transactions.
