Contract of Employment
Contracts of Employment
An employee who agrees to undertake work for an employer in return for a regular wage or salary automatically has a contract of employment. A contract can be oral or written however it is always recommended that a contract should be in writing. It is in fact a legal requirement that a statement of terms and conditions is provided to an employee as outlined below.
The majority of employees are employed under permanent or open ended contracts of employment. In other words, the contract continues until such time as the employer or employee ends it with the required notice. It is always recommended that a probationary period of approximately six months is inserted into a permanent contract to ensure the employee is a “good fit” for the employer. A probationary period can be extended in certain circumstances however it is recommended that this does not exceed 12 months as an employee may automatically accrue rights under the Unfair Dismissal Act 1977 (as amended).
Many other employees work under fixed-term or specified-purpose contracts which are contracts which end on a specified date or when a specific task is completed. Fixed term contracts are governed by the Protection of Employees (Fixed Term) Work Act 2003. Further information is available on this under our Section “Fixed Term Work”.
Part time workers are those who work less than full time employees and this relationship is governed by the Protection of Employee (Part Time Work) Act 2001 (as amended). Further information is available on this under our section “Part Time Work”.
As outlined above, an employer is under a legal obligation to provide a written statement of terms and conditions of employment to an employee within 2 months of the employee commencing employment. This is provided for in the Terms of Employment (Information) Act (1994) (as amended).
What information should be contained in a contract of employment?
At a minimum the following information should be included:
- the full name of employer and employee;
- the address of the employer;
- the place of work or where there is no fixed place of work, a statement providing that the employee is required or permitted to work at various places;
- the title of job or nature of work (job description);
- the date of commencement of employment;
- details of rest period(s) and breaks as required by law;
- remuneration of the employee (including when it is paid and the pay reference period for the purposes of the National Minimum Wage Act 2000(as amended);
- hours of work including overtime;
- duration of a temporary contract;
- that the employee has the right to ask the employer for a written statement of his/her average hourly rate of pay as provided for in the National Minimum Wage Act 2000
- details of paid leave;
- sick pay and pension (if any);
- period of notice to be given by employer or employee;
- details of any registered employment agreements or employment regulation order which applies to the employee and confirmation of where the employee may obtain a copy of such agreement or order.
What An Employer Must Provide
An employer must provide additional information to an employee who may be required to work outside Ireland for example, terms and conditions governing any secondment arrangement.
It should also be remembered that an employer cannot simply change an employee’s terms and conditions of employment without engaging with the employee to obtain their consent otherwise this may result in a unilateral breach of contract. An employer is obliged to notify an employee of a change in any terms and conditions within one month of the change taking effect however it is always good practice to engage with the employee well in advance of any changes being made.
The statement of these terms must be signed and dated by the employer and it is always recommended that an employee signs this also. The employer must keep a copy during the period of the employee’s employment and for at least a year after it ceases. It is recommended however that a copy is kept for up to six years pursuant to the Statute of Limitations 1957 (as amended).
It is always recommended that advice is obtained at the outset when drafting the terms and conditions of employment for a new employee as additional terms may be required such as restrictive covenants, confidentiality and intellectual property law to name but a few.
In the event of a breach of the Terms of Employment (Information) Act 1994 (as amended), an employee may have the option to lodge a claim with the Workplace Relations Commission where compensation can be awarded for failure to provide a statement of terms at commencement or for any other breach of the Act.