1. Introduction
Irish law grants a range of protections to employees but is often considered a more flexible and employer-friendly than other European countries. Ireland has a highly educated, English speaking workforce which is the youngest in Europe and ranked first in the world for its flexibility and adaptability.
Employment law in Ireland is governed by common law, an extensive statutory framework (some of which has its origins in EU law) and a range of fundamental rights protected by the Constitution of Ireland.
LK Shields Solicitors has more than 60 solicitors based in offices in the cities of Dublin and Galway. Our Employment Law team advises domestic and international employers across a wide variety of industries on all aspects of employment law.
We take a practical, ‘hands-on’ and commercial approach, which translates into accessible, decisive and strategic advice, with client focused solutions.
* This guide relates to the law in the Republic of Ireland only.
2. Labour and Employment Law Requirements
A) Employer Policy Requirements
Disciplinary Policy
A disciplinary policy must be provided to the employee within 28 days of commencement of employment.
Grievance and Bullying and Harassment
Case law has made clear that employers should have in place both a Grievance and Bullying and Harassment policy as the absence of such policies will inhibit an employer’s ability to defend claims arising from these matters.
Whistleblowing
Since 1 January 2023 all private-sector organisations with 250+ employees are obliged to have established internal reporting channels and procedures for the making of protected disclosures. From December 2023 this obligation will extend to all employers with between 50-249 employees.
GDPR/Data Privacy Notice
An employee facing privacy notice is mandatory under the GDPR / Irish data protection legislation and relevant guidance from the Irish data protection commission. A data protection policy is also mandatory in circumstances where it covers an employee privacy notice. Certain other data protection related policies are also mandatory (e.g. CCTV policy, data record keeping and retention policy and IT usage policy) depending on the circumstances.
Other Policies
In addition to the above, there are a number of policies that employers often put in place to help manage employee relations and mitigate legal risk. We would typically see and recommend the following policies:
- Family leave policies (eg, maternity, adoptive, paternity, parental etc);
- Sick leave policy;
- Annual leave policy;
- Remote working and right to disconnect policies;
- IT and social media usage policy; and
- Health and safety policy.
B) Employee Training Requirements
An employer must provide any health and safety instruction and training necessary to ensure, as far as reasonably practicable, the safety, health and welfare of employees at work.
Anti-bullying and harassment training is also strongly recommended and considered necessary for an employer to be able to defend a claim in respect of harassment by showing it took reasonably practicable steps to prevent employees carrying out harassment in the course of employment.
In accordance with the European Union regulations, where training is mandated by law or collective agreement it must be provided free of charge. Time spent on such training will count as working time and will take place during working hours, if possible.
C) Employment Agreements
Employers are required to provide a written statement setting out the particulars of employment as follows:
An employer must provide a Statement of Terms within five days of commencing employment to include:
- The full name of the employer and the employee
- The address of the employer
- The expected duration of the contract
- The method of calculating pay and the pay reference period
- The expected length of the working day and week
- Duration and condition of probationary period, where one applies
- The place of work or where there is no fixed or main place of work, confirmation that the employee is employed at various places or is free to determine their own place of work
- The commencement date, title, grade, nature or category of work, or a brief specification or description of work and details of the terms and conditions relating to hours of work (including overtime).
Employers also must provide the following written terms within one month of commencing employment:
- Pay intervals, details of any paid leave, including annual leave and public holiday entitlements, details of any sick pay entitlements, details of any pension and/or pension schemes, the period of notice to be given by employer/employee and any collective agreements that may affect terms of employment
- Detail of training that will be provided, where mandatory training is required by law
- The identity of the social security institutions receiving the social insurance contributions attached to the contract of employment and any protection relating to social security provided by the employer
- If an employee’s working pattern is unpredictable, the employer must set out the number of guaranteed paid hours and the remuneration for those hours. The hours and days must be referenced, as well as the notice period for work assignments.
In practice, employers usually provide one document comprising the contract of employment prior to the employee commencing work.
3. Corporate Law Requirements
A) Compliance for Incorporation
LK Shields offers an in-house company secretarial service which can assist organisations with the necessary corporate filings when establishing in Ireland.
When setting up a business in Ireland, you can carry on the business as a sole trader or register the legal form of the entity with the Companies Registration Office (CRO) in Ireland. The CRO acts as the central repository of public statutory information on Irish companies, external companies (branches), limited partnerships and business names.
If a company is to be incorporated, there are various types of company that can be formed, including a private company limited by shares (LTD), designated activity company (DAC), public limited company (PLC) and company limited by guarantee (CLG). This summary considers the most common type of private company which is the LTD under the Companies Act 2014.
The incorporation of an LTD is relatively straightforward and involves the submission of a signed incorporation application form and Constitution to the CRO. If a company does not have at least one director resident in an EEA member state as required by the Companies Act 2014, a Section 137 insurance must be procured and filed with the incorporation application. The bond alleviates the requirement to appoint an EEA resident director.
To prepare an incorporation application for an LTD, you must have the following information:
Company Name – a company name must end with the word “Limited” and cannot be too similar to an existing company name, cannot be contain offensive words or words which suggest a connection with local government or authorities. Certain other restrictions to company names such as the use of the work “bank” or “banking” which requires permission of the Central Bank of Ireland.
Business Activity – a brief description of the primary business activity to allow classification with the Nace codes used by the CRO.
Registered Office Address – All Irish companies are required to maintain a physical registered office address in Ireland. PO Boxes are not acceptable.
Company secretary – all Irish companies must have a company secretary. The company secretary may be a corporate entity or natural person. There is no restriction on the residency or domicile of the company secretary.
Directors – An LTD may have a sole director provided that person is not also the company secretary. Corporate directors are not permitted.
Share Capital – the first shareholder(s) will sign the Constitution which is filed with the incorporation application. The Constitution must state the share capital of the company and the number of shares to be issued to the first subscriber(s). An LTD may have one shareholder with the minimum of one share issued to the shareholder. Shareholders may be individuals or corporate entities and there is no restriction on the residence or domicile of shareholders.
Once the above items are in place, a Form A1 and Constitution signed by all company officers and shareholders is submitted to the CRO. A bond must accompany the application if there is no EEA resident director. The application is mandatory online filing, and the signed application is uploaded to the web filing platform. The filing fee is €50. If approved by the Registrar, a Certificate of Incorporation will issue in 3 to 5 working days.
B) Post Incorporation Registrations
All newly incorporated companies are required to register their beneficial ownership details with the CRBO within 5 months of incorporation; however, in practice, the information must be filed as soon as possible following incorporation as “designated persons” such as banks and professional service providers are obliged to check that a company has filed its beneficial ownership as part of the designated person’s customer due diligence procedures.
A beneficial owner is a natural person who directly or indirectly owns or controls more than 25% of an Irish company. If there are no beneficial owners, a company must register its directors with the CRBO as the “senior managing officials”. All changes to the beneficial ownership of a company must be notified to the CRBO within 14 days.
All companies incorporated in Ireland are given an annual return date (“ARD”) when they are incorporated at the CRO. Annual Returns are filed at the CRO and must be filed not later than 56 days after the ARD each year.
Failure to file an annual return on time can have several consequences including the imposition of the late filing fee, prosecution of the company and/or its directors, the loss of the audit exemption or the possible involuntary strike-off and dissolution of a company by the Registrar.
Irish companies are also obliged to notify the CRO of certain changes and corporate actions such as allotments of shares, alterations to the Constitution, the passing of shareholder resolutions, changes of company officers and variations of share capital. The majority of notifications are now filed online.
4. Payroll and Benefits Providers
In Ireland, most small and medium-sized employers outsource payroll and benefit responsibilities to third party specialists to reduce administrative burden. We would be happy to recommend payroll and benefits providers to suit an organisation’s business needs.
