Payment of Wages (Amendment) (Tips and Gratuities) Act 2022 Signed into Law by the President to Ensure Employees Receive “Fair Tips”

Introduction:

The Payment of Wages (Amendment) (Tips and Gratuities) Act 2022 was signed into law on 20 July 2022. The Act, which requires a Ministerial Order to commence, will require employers in certain sectors to pass tips and gratuities received in an electronic mode of payment to staff. The Act will also prohibit employers from using these tips and gratuities to ‘make up’ an employee’s basic wage and will provide more information to consumers about how their money will be distributed should they decide to leave a tip.

Key Components of the Bill:

    • Employers will no longer be allowed to use tips to make up statutory or contractual pay entitlements. Tips and gratuities will be distributed only in addition to wages.
    • Employees will now be entitled to tips paid electronically by credit or debit card. Employers will be obliged to show the value of tips received in a period and the portion paid to the individual employee for that period.
    • The Act only regulates electronic payments. Cash tips are not included as this would not be considered ‘workable’ according to the Workplace Relations Commission (WRC).
    • Employers will not be authorised to retain tips for themselves except where the employer can prove they perform, to a substantial degree, the same work performed by the employees who receive a share of electronic tips. The employer may only retain such amount that is fair and reasonable in the circumstances having regard to the amount of work performed during the period specified.
    • Any charge labelled as a ‘service charge’ or charge for service must now be dealt with the same as any other electronic tip received.
    • The Act requires employers to provide evidence of a clear policy, visible to the public on how the business deals with tips, gratuities and service charges.
    • Templates on how to display policy on tips will be circulated to employers.
    • The Minister for Enterprise, Trade and Employment must review the legislation after it has been in effect for one year.

Conclusion:

One of the main changes brought about by this Act is that it will eradicate certain bad practices that exist in areas such as parts of the hospitality sector. As society moves further away from regular cash transactions toward contactless payments, this protection for employees is absolutely necessary. The requirement for the employer to display a policy on tips publicly is also a welcome development for the consumer. This prevents any misleading of customers and gives the public the assurance that their money is reaching the person they intended to pay. For example, the Act removes any confusion surrounding the term ‘service charge’ and what this means. Overall, the Act is a positive development as it protects employees, informs the consumer and places little burden or cost on the employer.

For more information on this topic please contact Patricia Canty of our employment department on 021-7300200 or by email to pcanty@jwod.ie

Sick Pay Given Statutory Protection as Sick Leave Bill Passed by Oireachtas

As of 13 July 2022, the Sick Leave Bill 2022 has been passed by the Oireachtas and will come into force later in the year once the Minister signs a commencement order.

This legislation will bring Ireland into line with other developed states across Europe who provide statutory protection for those employees who cannot work due to illness.

The need for such legislation was highlighted during the Covid-19 pandemic in particular as currently, there is no legal requirement for employers to pay when an employee is out with an illness.

Tánaiste and Minister for Enterprise, Trade and Employment, Leo Varadkar, welcomed the development:

“This is a really important new employment right, that all workers will now have, no matter what their illness or job. Many employers pay sick pay, but the pandemic really highlighted the vulnerability of some workers, especially in the private sector and those on low pay. We’re also been behind our European counterparts on this, with Ireland being one of the few advanced countries without such a scheme.”

What the new Legislation entails:

  • The scheme will be rolled out over 4 years. Employees will be entitled to 3 days’ paid sick leave per year in year one. This will increase to 5 days in year two, 7 days in year three, and 10 days in year four.
  • Employees will receive 70% of their normal daily wage subject to a daily maximum of €110.
  • These provisions can be reviewed at Ministerial level in order to deal with inflation rates and increased incomes over time.
  • The scheme will be enforced through the Workplace Relations Commission and the Irish Courts system.

Requirements for employees in order to qualify: 

  • The employee must have worked for the employer for no less than 13 continuous weeks prior to seeking sick pay.
  • An employee seeking to avail of sick pay must have a valid medical certificate (i.e. certified by a GP as unfit to work).

Consequences for the employer:

  • Employers are not to treat differently those who take or apply for sick pay.
  • Employers are advised to review their standard employment contracts urgently.
  • If an employer offers a sick pay scheme which is as favourable as the statutory provision, then the employer is not under any new obligation.
  • If an employer offers a sick pay scheme more favourable than the statutory provision there is no obligation to adjust their existing scheme.
  • If an employer offers a sick pay scheme less favourable than the statutory scheme then it will be “deemed to be so modified” so that it is not less favourable.
  • An employer who cannot afford to pay workers in accordance with the scheme can apply to the Labour Court for an exemption. This exemption will last for a minimum of 3 months and up to 1 year.

Conclusion:

The passing of the Sick Leave Bill by the Oireachtas is a further example of Ireland’s commitment to provide a modern statutory framework which will protect the rights of employees. In recent years, the legislature has introduced acts governing paternity benefit, parental leave benefit, enhanced maternity benefit, treatment benefit and the extension of social insurance benefits to the self-employed. The Sick leave Bill 2022 will undoubtedly be a significant development in the law protecting workers in this state, particularly those in the low-income sector. The Bill aims to not impose any unrealistic obligations on employers through its 4-year implementation period as outlined above. This will give employers sufficient time to plan and budget if they do not have an adequate sick pay scheme in their standard employee contract.

For more information on this topic please contact Patricia Canty of our employment department on 021-7300200 or by email to pcanty@jwod.ie

Reform of duty-of-care legislation seeks to strike the right balance when considering an Occupier’s Liability

The Minister for Justice has now received Government approval to reform duty of care legislation. Following a review of existing legislation in this jurisdiction and abroad, it appears major changes are on the way for the Occupiers Liability Act, 1995 which will be seen to be a key factor in reducing insurance costs for the economy and communities.

The proposed reform will include “voluntary assumption of risk” under Head 5 of 1995 Act. The proposed reform contains 4 key developments:-

• Inserting into primary law a number of recent court decisions which rebalance the duty of care owed by occupiers to visitors and recreational users such as the Court of Appeal ruling in Byrne -v- Ardenheath Company Limited [2017] IECA 293.
• A change in the standard to clarify that when the occupier of a property has acted with reckless disregard for a visitor or customer, it is the standard of “reckless disregard” rather than the “reasonable grounds” which should apply in relation to any consideration of liability.
• Limits to the circumstances in which a Court can impose liability on the occupier of a premises where a person has entered onto the premises for the purpose of committing an offence; and
• Allowing for a broader range of scenarios where it can be shown that a visitor or customer has voluntarily assumed a risk resulting in harm.

The proposed amendments will seek to strike a fairer and more reasonable balance between the steps an owner or operator of a premises must take to keep their customers and visitors safe, and what individuals themselves can be expected to take responsibility for when entering a business, club or community building.

The proposed legislation will be placed before the Oireachtas for enactment as part of the Courts and Civil Law (Miscellaneous Provisions) Bill, 2022.

If you would like further information in relation to any of the above, please contact Ciara Lehane, Associate Solicitor by email to clehane@jwod.ie or call 021-7300200.

J.W. O’Donovan Solicitors LLP announces SHARE as its 2022 Charity Partner

 

 

J.W. O’Donovan Solicitors LLP are delighted to announce SHARE as its Charity Partner of the Year for 2022.

SHARE is a charitable organisation based in Cork, dedicated to providing housing and other support for the elderly. Over the past 52 years they’ve “brought help and hope, homes and happiness to the lonely old people who have been forgotten by society”.

SHARE provides supported independent living in their 140 comfortable and secure housing units across seven different locations, have piloted a dementia outreach programme which sees vetted volunteers and students visiting people living with dementia, and have up to 125 daycare centre clients, for whom they provide medical and social support services.

J.W. O’Donovan Solicitors LLP will announce as the year continues what we have in store in order for us to be able to support SHARE and how you can help them too. In the meantime, donations are welcome through their website.

J.W. O’Donovan Solicitors LLP acts for Trustap Limited in €3.1 million fundraising

John Fuller (Partner, Corporate) of J.W. O’Donovan Solicitors LLP has acted for Trustap Limited in relation to its recent fundraising of €3.1 million from Middlegame Ventures, Act and Atlantic Bridge.

Trustap is a digital transaction platform that protects a purchaser from being scammed when transacting with someone they don’t know and essentially brings peace of mind to the user when engaging in an online or face-to-face transactions.

Trustap Limited was founded in Cork in 2017 and is growing quickly, with offices in Ireland, the UK and the US. Chief executive and founder Conor Lyden is quoted in saying “the one thing that has been a big focus for us, is hiring more developers, and also the build out of our sales team, particularly in the US.” The largest fundraise to date for the company will see their Irish team grow again and will be used for marketing, expanding into new markets, and the roll out of new features.

J.W. O’Donovan Solicitors LLP were delighted to act in the fundraising for this Cork headquartered company and look forward to what’s to come for Trustap Limited.

FBD Judgment – Court clarification on compensation for disturbed pubs

The High Court has provided clarification on the extent of losses that Insurance group FBD must cover under its business interruption policy. Certain issues in relation to the scope of losses were raised a test case of four pubs. Following on from our previous articles in relation to this interesting case, Justice Denis McDonald ruled that FBD must indemnify Sean’s Bar in Athlone, as well as the Lemon and Duke, The Leopardstown Inn and Sinnott’s in Dublin as a result of these businesses having to close due to the Covid-19 pandemic.  It is reported that the ruling will affect an estimated 1,000 pub policies.

In Mr. Justice McDonald’s recent judgment, he provided further clarity concerning the issues to be taken into account by FBD in assessing the amount of compensation to be paid to the businesses.

Mr. Justice McDonald found that the Dublin pubs were subject to an early closing requirement during a number of periods from the 10th of August 2020 and were entitled to be indemnified in respect of the losses they had suffered.  He was also asked to adjudicate on a claim by the pubs for compensation in relation to retaining staff and continuing to pay certain staff while the premises were closed.  He found each of the claims to be partly successful, with the exception of the Leopardstown Inn in light of the evidence.

Mr. Justice McDonald noted the extensive efforts made by the parties to address the issues regarding the quantum of the losses and in relation to those issues that remained outstanding.

The Judge also concluded that FBD is not entitled to pursue any issue in relation to under insurance.

The case will return before the Court next month wherein we will provide a further update in relation to this interesting case.

Please email any queries to clehane@jwod.ie

J.W. O’Donovan LLP acted in the sale of Demesne Electrical Sales Limited to OEM International

J.W. O’Donovan LLP acted as legal advisors to the shareholders of Demesne Electrical Sales Limited in the sale of the company to OEM International.

The acquisition, which took effect on the 13th of January 2022, sees OEM International acquire Ireland’s leading independent importer and distributor of electrical control, switchgear, energy saving & installation products. Founded in 1977, Demesne Electrical has grown from humble beginnings in a house Dublin’s Robin Hill Road to a HQ facility in Dublin 24 and national distribution centres in Cork and Dungannon. The company’s total revenue is now circa €20 million. OEM International’s President and CEO Jörgen Zahlin is quoted in saying that their company’s ambition is to “further develop and grow the existing Demesne business and to gradually strengthen the customer offering”. Now under new ownership, Demesne Electrical Sales Limited will continue on a path of further innovation and excellence in the electrical industry.

The team at J.W. O’Donovan LLP was led by John Fuller (Partner, Corporate), with assistance from Anne-Marie Linehan (Partner, Property), and David Pearson (Partner, Employment).