Employment Challenges for Irish Tourism

While the positive trends enjoyed by tourism in Ireland over the past two years continued through the first half of 2018, the sector is not without its challenges. Certain labour constraints remain a key talking point for many small to medium-sized businesses in the sector. These constraints tend to manifest themselves in the treatment of seasonal workers and the provision of short-term contracts which are areas of particular concern for many operators in the tourism trade. The fixed-term issue Seasonal businesses such as hotels, restaurants and bars that close for a certain period each year frequently query whether there are restrictions on the number of fixed-term contracts they can offer to employees? The law The Protection of Employees (Fixed-Term Work) Act, 2003 (the Act), sets out to provide equal treatment for fixed-term and specified purpose workers.  Fixed-term contracts may be used for a variety of purposes such as the provision of temporary cover during an employee’s maternity leave/sick leave, or the employment of an individual to work on a project which, once completed, will leave no further work for the individual to work on. The Act provides that where a person is employed on 2 or more continuous contracts the combined duration of those contracts must not exceed 4 years. In cases where this rule is broken (i.e. if a third contract is offered which extends the employees service beyond 4 years), the employee is entitled to a contract of indefinite duration. It is worth noting that this provision does not restrict employers from offering a standalone five-year fixed-term contract. The explanation Like most legal queries the answer to the fixed-term issue is not unequivocal. Provided that a business can demonstrate objective grounds for offering multiple, successive contracts there will be no restriction on the number of fixed-term contracts they offer employees. The fact that the business operates on a seasonal basis is (at the time of writing) considered objective grounds for offering multiple fixed-term contracts.  It is worth noting nonetheless that this interpretation has not been tested before a court since the commencement of the Act. Sunday premium rates of pay Another area of concern for many employers in the tourism sector is Sunday premium rates of pay. Workplace Relations Commission (WRC) inspectors are responsible for ensuring compliance with the provision of compensation for work on Sundays pursuant to section 14 of the Organisation of Working Time Act, 1997. In this regard, the amount paid to staff for working Sundays must be “reasonable… having regard to all the circumstances”. Over the past 12 months the Labour Court has made the following determinations in a number of cases involving hotels, restaurants and leisure centres: -

• a hotel paying staff a Sunday premium of 5 cents per hour was deemed “not reasonable”
• a restaurant paying staff a Sunday premium of 33% was deemed “reasonable”
• a leisure club paying staff a Sunday premium of 25% was deemed “reasonable”

Specified Sunday pay rates have been introduced in some industries such as mechanical engineering and construction. Comparable agreements have so far not been re-introduced in the tourism sector since the abolishment of the Joint Labour Committee rates which were deemed unconstitutional. There are currently no agreements in the pipeline for the tourism industry. Businesses are reminded that the onus rests in the first instance with the employer and the employee to agree on reasonable compensation for Sunday work. To learn more about the employment law challenges associated with the tourism industry please call the Peninsula 24-hour advice line on 0818 923 923 to speak with an advisor