Employer Resources Newsletter - November 2021

Posted on 22 Nov 2021
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In the face of increasing infection numbers, the Government has again stated that employees should work from home unless it’s necessary for them to be in the workplace, which may be the case for some of those working in the nonprofit sector.

This is one of a number of new public health measures announced recently along with advice on household close contacts and the use of antigen tests, restrictions on opening hours of on-licenced premises and extending the use of COVID-19 certs for cinemas and theatres.

Given the return to remote working, it is a good time to remind employers across the nonprofit sector about their responsibilities.

Health & Safety

The health, safety and wellbeing of employees should be the number one priority for employers, particularly in light of the ongoing changes in working arrangements due to COVID-19.

Employers should have conducted risk assessments from the previous full lockdown but it is worth considering conducting revised risk assessments on each of their employees’ home workspaces and resolve any new issues raised. Under the Safety, Health and Welfare at Work Act 2005, employers have the responsibility to ensure employees have a safe workspace. Employers are reminded that any equipment or training needed by employees should be in place to ensure, not only a comfortable, ergonomic workspace but also to mitigate the risk of potential personal injury claims. While employers may have conducted risk assessments in the earlier lockdown, it would be prudent to carry out new assessments in the event of any changes.

At Adare Human Resource Management, we provide full online DSE Training and Ergonomics Assessments to support clients in the nonprofit sector.

Assess hybrid working models

Our most recent HR Barometer Report found that for many organisations, including nonprofit, hybrid working is not as productive as initially thought. Our research found that there has been a drop from three quarters of employers in March 2021 to one third in October 2021 seeing benefits of hybrid working.

There are a number of reasons for this, including not implementing an appropriate model for the organisational needs, performance management and unclear expectations. What we are recommending organisations do during the current restrictions is to assess the models that they have implemented, evaluate it against the organisational requirements and adjust the models accordingly. We know hybrid working may not suit every organisation but for most it can work if all understand the expectations and deliver on those.

Vaccines

We would again reiterate that employers cannot mandate employees are vaccinated. Nor can they ask if someone has been vaccinated. However, they can actively encourage it and communicate with employees about the importance of getting the vaccine.

We’d advise employers to be mindful and respectful of an individual’s right not to get vaccinated and take the time now to prepare additional working arrangements where appropriate. And avoid a situation that may constitute discrimination, leading to legal issues.

Communication & Employee Engagement

Employers should continue with ensuring there are adequate communications structures in place. In order to be effective, communication must continue to be frequent and transparent. While these structures may have changed somewhat with the return to the workplaces, organisations should be able to pivot back to remote working structures easily.

Employers and managers should be visible and in touch with employees, not only fostering engagement of their employees, but demonstrating their own level of engagement in order to project the wider organisational vision into their employees’ every-day working practices. Maintaining continuous communication is key; the result is the ongoing building of trust and inclusivity; particularly as we face uncertain months ahead.

Employees must be encouraged to be autonomous and where appropriate get involved in collaborative practices. Clear communication for employees on expectations of their roles, agreed workload, priorities and key performance indicators are crucially important to maintain engagement.

Again, empathy towards professional and personal matters is important; managers should be flexible, provide support and encouragement, particularly for those who may be struggling.

Conclusion

While the nonprofit sector, among others, have been here before, we cannot underestimate the impact this may have on employees in terms of their own health and wellbeing, disruption to their work life balance as well as their professional development. It is frustrating for employers but equally frustrating for employees.

Communication is more important than ever and using this time constructively to plan ahead for 2022 is crucial.

Court rules that Company’s Mandatory Retirement Age is Reasonable

Background

The Employee appealed the decision of the Adjudication Officer, under the Employment Equality Acts 1998 to 2015, which had held that his complaint of discrimination on the age ground made against his previous employer was not well founded. The appeal was heard at the Labour Court on 9 December 2020.

The Complainant commenced employment with the Respondent in September 1989 and his employment ceased by virtue of his reaching his 65th Birthday on 21st January 2020. The Complainant alleged he was discriminated on age grounds by having to retire at 65. The Respondent disputed that the Complainant was discriminated against and submitted that there was an objectively justified mandatory retirement age for this category of worker and that the Complainant was fully aware of this.

Summary of Complainant’s Submission

The Complainant submitted that he wished to work beyond his sixty fifth birthday, that he never had any sick leave and that he saw no impediment to continuing working after his sixty fifth birthday. He also outlined that he had received a contract but that he had not signed same. It was his submission that he was aware of one employee in an equivalent role who had continued in employment beyond his 65th birthday. While the Complainant did not dispute that the organisation’s retirement plan included a normal retirement age of 65, he argued that it also referenced remaining in service after age 65 with the agreement of the organisation. In July 2019 the Complainant wrote to the Respondent seeking to work beyond his 65th Birthday. The Respondent replied on July 16, 2019, refusing the request stating that it was the policy of the organisation that all workers of that category retire on their 65th birthday. The Respondent wrote to the Complainant again on November 14, 2019, noting his upcoming retirement and restating that it was the organisations policy to have a fixed retirement age due to succession planning.

At the date of his retirement there was no qualified category of worker available to replace him and the Union wrote to the Respondent on the December 19, 2019, requesting the Complainant be given an extension of one year to bring him up to the state pension age of 66. This request was refused by the Respondent. Included in their arguments on behalf of the Complainant, the Union submitted that there was neither an objective justification nor a legitimate aim for having a mandatory retirement age and that the Respondent did not have a mandatory retirement age in place. They also pointed to the fact that office staff were regularly allowed stay on beyond their retirement age of 65. Referencing the Code of Practice on Longer Working the Union noted that the employer did not carry out an assessment in respect of the request to stay on which is encouraged by the Code of Practice.

The Union submitted that the Complainant had demonstrated he was discriminated against on the basis of age and sought compensation equating to twelve months salary on his behalf.

Summary of Respondent’s Submission and Evidence

The Respondent’s representative submitted that the Complainant was not discriminated against as it had always been the practice of the Respondent that workers of that category were required to retire at age 65. While it was accepted that the written contract did not expressly provide for this it had been universally employed. The representative outlined that the practise was reflected in the Respondent’s handbook and in its Retirement and Death Benefits Plan, outlining that the Complainant was at all times aware of the mandatory retirement age and that he had engaged with the Chief Financial Officer since 2017 in respect of Additional Voluntary Contributions (AVC’s). Evidence was submitted in the form of written communication from the Complainant dated July 1, 2019, where he stated that he wished to extend his employment past his 65th birthday up to the time that he would qualify for the statutory old age pension, which was argued by the Respondent, to be a clear indication that the Complainant was aware that his employment would cease on his 65th birthday.

In her evidence for the Respondent the HR manager outlined that never had an employee in that role worked beyond their 65th birthday and the fact that some had even retired before their 65th birthday. In respect of the individual that the Complainant had referenced in his evidence, the Respondent confirmed that that person had changed roles for a period prior to reaching retirement age and he continued on to provide cover for a manager in that capacity only. It was put to the HR Manager in cross examination that the handbook and pension policy includes reference to ‘normal retirement age’ and if it was a mandatory retirement age why was that not stated. The HR Manager confirmed that those documents were in respect of all staff and not just the role the Complainant occupied.

The overarching argument of the Respondent was that there existed a mandatory retirement age implied into the contract, which was expressly contained in the Employee handbook and in the pension scheme and that it had been established through evidence that the Complainant was aware of this fact. The second issue was whether or not there was an objective justification underlying the mandatory retirement age which was argued by the Respondent’s as existing, due to the specialism for the role and the fact that it would take six years to train someone to do the job. In light of this the Respondent argued that a succession plan was vital to ensure that they had sufficient qualified staff at all times. Having a mandatory retirement age for this category of staff provided certainty, outlining the fact that from time to time the succession planning fails does not undermine it as a legitimate aim.

Discussion

Having considered the submissions from both parties and the evidence put forward by the Respondent the Court noted that while the Complainant disputed that a mandatory retirement age existed no explanation was offered as to why he looked for an extension if he did not know that retirement at 65 was mandatory.

The Complainant pointed to only one individual who had worked beyond 65 in support of his contention that a retirement age of 65 was not mandatory, but did not contradict the Respondent’s evidence that the individual in question had transferred out of his role five years before his retirement. Based on the evidence the Court found that on the balance of probabilities there was a mandatory retirement age for that specific category of staff. The next issue the Court considered was whether or not there was an objective justification that was reasonably justified by a legitimate aim for having a mandatory retirement age. The Court noted the undisputed evidence of the Respondent’s witnesses concerning the nature of the job, the fact that it was safety critical, the training period required for the specific role, and the investment required by the Respondent in terms of training to the standard they required.

Taking account of all of these issues the Court was satisfied in this instance, that a mandatory retirement age of 65 was objectively and reasonably justified as it constituted a legitimate aim. In this case the legitimate aim was to ensure a through flow of appropriately qualified staff in that category and to ensure that employees are not required to continue working until they are unable to perform the duties.

Determination

The Court determined that the Respondent acted in compliance with Section 34 (4) of the Act, that the mandatory retirement age of 65 which applied to the Complainant, was necessary, reasonable, proportionate and accordingly amounted to objective justification for that maximum retirement age. Accordingly, the Court confirmed the decision of the Adjudication Officer and rejected the appeal.

Our Commentary

It is important to note that for employers there must be an objective justification in pursuit of a legitimate aim and the means of achieving that aim are appropriate and necessary in order to justify a mandatory retirement age and a refusal to extend a contract beyond the retirement age. In this instance, the claimant’s contract did not include a retirement clause. Nevertheless, it is prudent to have a retirement clause in the contract and also to maintain the legitimate objective for the retirement age in that clause.

The respondent in this case contended there was an implied term in the employee’s contract that the retirement age was obligatory. The respondent claimed that the mandatory retirement age was empirically justifiable for succession planning as they needed to plan to have that category of staff ready to step into the retiring employee’s role. The court held that the employer had objectively justified the choice of a retirement age of 65 years of age regarding the employee’s role. Nevertheless, the reality is that there was no retirement clause in the complainant's contract of employment, which persists to be fascinating.

Draft Statutory Sick Leave Bill

The Draft Statutory Sick Leave Bill 2021, as published earlier this month provides for a statutory entitlement to a minimum period of paid sick leave for all employees in the event that they fall ill or sustain an injury which prevents them from being able to work.

The intention is that the proposed legislation will provide a floor level of protection to all employees and that existing less favourable sick pay arrangements will be rendered null and void. Where there are more favourable provisions relating to sick pay in the contract of employment any such provision shall be in substitution for and not in addition to statutory sick leave.

The Bill provides that an Employee, subject to their having 13 weeks continuous service with their employer shall be entitled to up to and including three sick leave days per annum, or such additional number of statutory sick leave days as may stand specified from time to time by order of the Minister.

Phasing of Paid Sick Leave:

  • 2022 – 3 days covered by employer
  • 2023 – 5 days covered by employer
  • 2024 – 7 days covered by employer
  • 2025 – 10 days covered by employer.

Rate of Sick Pay

The payment rate for statutory sick pay has been set at 70% of the employees’ normal rate, subject to a maximum of €110 per day. The employer must deduct taxes in the normal manner and the employee has to be medically certified as unfit for work to qualify for statutory sick pay.

Employers will have to retain records of all statutory leave taken by their employees for a period of four years and employees maintain all existing employment rights when availing of benefits under the proposed Statutory Sick Pay legislation. The right to sick pay will be legally enforceable by Employees through the Workplace Relations Commission and the Courts. Remedies available to successful complainants will include an award of compensation up to a maximum of 20 weeks remuneration.

What next for the Nonprofit Sector?

Given this will be an additional cost burden on employers, non-profit organisations will need to plan for the potential impact of the scheme and also consider where changes to existing policies are required, once the new scheme is introduced next year.


Employment Wage Subsidy Scheme – Time for Employers to Prepare

The Employment Wage Subsidy Scheme (EWSS) is due to cease on 31 December 2021. In the Government’s most recent announcement about imposing certain measures, there was no mention of any potential extension to the scheme.

According to information published by Revenue, 36,600 employers were still registered for the EWSS, supporting over 250,000 jobs.

For any nonprofit organisation still reliant on the EWSS, now is the time to start preparing and assessing their financial and headcount situation.

Adare Human Resource Management is available to help and support with any HR issues nonprofit organisations need as they plan for 2022.

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