Holiday entitlement and pay

The Organisation of Working Time Act, 1997, (the Act) in relation to annual leave, is applicable to all sectors both private and public with the exception of Garda Síochána and Defence Forces.

Under the Act, there is no qualifying period for entitlement to annual leave meaning it applies from day one of employment.

All time worked, including overtime, entitles an employee to paid annual leave.

Employees on protective leave including maternity leave, additional maternity leave, paternity leave, adoptive leave, additional adoptive leave, any maternity leave remaining to which the father is entitled in the case of the death of the mother, health and safety leave, jury duty, parental leave, force majeure leave and the first 13 weeks of carer’s leave, retain their annual leave entitlements.

Time worked on public holidays should also be counted when calculating annual leave entitlements.

Time spent on annual leave itself should be counted when calculating an employee’s annual leave entitlement, based on the hours an employee would have worked, had they not been on annual leave. Based on a European Court of Justice ruling in January 2009 and the Workplace Relations Act 2015, employees should continue to accrue statutory annual leave while absent on sick leave or from an occupational injury.

Where an employee is placed on short time i.e. working hours or pay are temporally reduced by 50% or more, annual leave entitlement will be based on actual hours worked.

Employees do not accrue annual leave while on a temporary lay-off, an absence by strike, a career break or during a period of unpaid leave.

For the purpose of the Organisation of Working Time Act, 1997, the leave year runs from 1st April to 31st March each year. However, employers are not prohibited from using a different 12-month period as long as the same leave year is used consistently. Many employers, for example, have changed this so that their leave year runs from January 1st to December 31st each year.

Under the Organisation of Working Time Act, 1997 employees have their holiday entitlement calculated in one of the following ways:

Employees working at least 1,365 hours in a leave year will be entitled to four working weeks’ annual leave entitlement.

For example, an employee works Monday to Friday, 9am to 5.30pm = 37.5 hours per week worked excluding breaks.

37.5 x 52 = 1,950 hours worked in the leave year. Therefore he/she is entitled to four weeks of annual leave (in this case, 20 working days of holiday entitlement).

Employees working at least 117 hours per month will have an entitlement to 1/3rd of their working week as annual leave entitlement.

For example, an employee works Monday to Thursday, 9am to 5.30pm = 30 hours per week worked for a period of 6 months. 30 x 4 weeks = 120 hours worked per month for 6 months. Therefore he/she is entitled to 1/3rd (1.33 days) of a week for each month worked i.e.,1.33 days x 6 months = 7.98 rounded up to 8 days holidays.

This formula is used primarily for part-time employees who work less than the hours in either of the above cases. But it can also apply to employees that leave an organisation during the year or those that join the organisation during the year. They will be entitled to 8% of the hours worked as their annual leave entitlement.

For example, an employee works Monday to Friday 9am to 1pm on a part time basis. Therefore he/she works 4 hours per day x 5 days per week = 20 hours per week. 20 hours per week x 52 weeks =1,040 hours worked per year by 8% = 83.2 hours rounded up to 83.5 hours holiday entitlement.

When determining when an employee will be granted annual leave, the employer must consider the employee's need to balance work and any family responsibilities, as well as the employee's need for rest and recreation.

The employer must consult with the employee or his or her trade union at least one month before the start of the leave. The employer must also ensure that the employee receives the leave within six months of the end of the leave year.

An employee who works for an employer for a continuous eight-month period shall be entitled to an unbroken period of two weeks’ annual leave.

Employees are entitled to be paid for annual leave before the leave takes place and at the normal rate of pay. In instances where the board and lodging constitute part of the employee’s remuneration this will not be received while the employee is on annual leave.

There are ten public holidays that fall in each calendar year as follows:

• New Year’s Day (January 1st)
• St Bridget’s Day (First Monday in February)
• St. Patrick’s Day (March 17th)
• Easter Monday
• First Monday in May
• First Monday in June
• First Monday in August
• Last Monday in October
• Christmas Day (December 25th)
• Stephen’s Day (December 26th)
• Any other day or days prescribed for the purpose.

All full-time employees have an immediate entitlement to a public holiday benefit.

Where an employee is terminating their employment in the week before the public holiday is due to fall, they are entitled to receive payment for that public holiday, equal to what they would have received had they remained in work. An employee is not entitled to benefit from a Public Holiday if they are absent due to the following circumstances:

• an absence in excess of 52 weeks by reason of an occupational injury
• an absence in excess of 26 weeks by reason of illness of injury an absence in excess of 13 weeks by reason not referred to above but being
• an absence authorised by the employer, including layoff
• an absence by reason of a strike
• an absence by reason of being placed on health and safety leave.

There are five sets of circumstances in which an employee will not be entitled to a Public Holiday. These are as follows:

• the employee is absent for a period of 52 weeks (or more) due to an occupational injury
• the employee is absent for a period of 26 weeks (or more) due to illness or injury
• the employee  is absent for a period of 13 weeks (or more) not in relation to (a) or (b) except in the case of authorised absence by the employer including lay off excluding maternity leave, adoptive leave or parental leave
• the employee is absent due to a strike
• the employee is absent owing to being placed on Health & Safety Leave.

Employees who are not full-time have to fulfil the following criteria to obtain a public holiday benefit. They must have worked for the employer concerned for at least 40 hours in the preceding five weeks ending on the working day before the public holiday.

Employees who meet this criterion and who normally work on the day in which the public holiday falls are entitled to one of the benefits outlined below, based on the number of hours he or she would normally work on that day.

• a paid day off on that day
• a paid day off within a month of that day
• an additional day of annual leave
• an additional day’s pay

If the employee so requests, no later than 21 days before the public holiday, the employer must inform the employee which of the above arrangements will apply no later than 14 days before the holiday. If the employer does not specify the arrangements on time, the employee will receive a paid day off on the public holiday. Employees meeting this requirement, but who do not normally work on the day the Public Holiday falls, are entitled to one-fifth of the benefit based on their normal working week. For example, an employee who works 20 hours per week from Tuesday to Friday is entitled to 4 hours benefit for a public holiday that falls outside of these days (see below for employee entitlements for a public holiday).

Example 1:

An employee on reception who works 37.5 hours per week Monday through to Friday is requested to work the May Bank Holiday Monday. The employee is entitled to be paid for the day at their basic rate (unless their terms and conditions allow for a higher rate) as well as receiving one of the following:

• a paid day off within one month
• an extra day of annual leave
• an extra day’s pay

Example 2:

An organisation hires a part-time receptionist working 20 hours a week (5 hours per day Tuesday through to Friday). The receptionist is not required to work the May bank holiday.

The employee is entitled to the following payment 5 hours per day x 4 days =20 hours per week 20 hours per week x 5 weeks = 100 hours worked in the preceding 5 Weeks.

Payment due for the bank holiday = 4 hours, i.e. 1/5th of his/her working week.

Example 3:

An employee ceases employment the Friday prior to the May bank holiday. On calculation of the final payment a normal day's pay is payable by the business with whom the employee was employed the week prior to the Public Holiday.

The Act provides for the following Church Holidays:

• 6 January, except when it falls on a Sunday
• Ascension Thursday
• The Feast of Corpus Christi
• 15 August, except when it falls on a Sunday
• 1 November, except when it falls on a Sunday
• 8 December, except when it falls on a Sunday

An employer may for the purpose of fulfilling any relevant obligation under the Act treat as a Public Holiday in lieu of a Public Holiday:

• the Church Holiday falling in the same year immediately before the Public Holiday
• the Church Holiday falling in the same year immediately after the Public Holiday.

The Workplace Relations Act (Commencement) Order 2015 provides that statutory annual leave entitlement accrues during a period of certified sick leave, and for an increase in the annual leave carryover period from 6 months to 15 months for employees who could not, due to illness, take annual leave during the relevant leave year or during the normal carryover period of 6 months.

The amendments provide, in the event of termination of employment, for payment in lieu of annual leave which was untaken as a result of certified illness in circumstances where the employee leaves the employment within a period of 15 months following the end of the leave year during which the leave entitlement accrued.

It should be noted that this decision and the Workplace Relations Act 2015 only apply to statutory annual leave and not to additional or other leave, such as service days or company leave. Because there is a limit to how much annual leave an employee can earn in a year, sporadic and low-level absences from work will not affect a person's annual leave entitlement over the course of a year. However, where a person is on long-term absence from work, this ruling may have a significant cost-increasing effect for employers. Therefore, it is advisable that long periods of absence are adequately managed to ensure that the employee either successfully returns to the workplace or there may be  sufficient evidence to warrant termination of the contract of employment on the grounds on "incapability".

The Act stipulates that sickness (covered by a medical certificate) while on annual leave is not counted as part of holiday leave.

An Employment Regulation Order (ERO) establishes the minimum rates of pay and working conditions for employees in a specific industry.

There are currently three EROs in operation, one for each of the following:

• Sector of contract cleaning
• Security sector
• Early childhood education and care 

Employers are required to pay the wage rates and provide the working conditions outlined in the ERO. They cannot offer less favourable wages or working conditions than the ERO.

Security Industry:

Annual leave entitlements remain unchanged and are as per the previous Security Industry ERO. It provides for levels of annual leave equivalent to the statutory minimum and are based on employees who work at least 1,365 hours per annum. Part time employees' annual leave entitlement is calculated on a pro rata basis. Thus, the proposed ERO is not requiring the employer to afford additional leave entitlements to employees than they otherwise would have attracted under the Act if there were no ERO in place.

Changes have been made to the public holiday entitlement under the new Security Industry ERO. The proposed ERO does not require the employer to afford additional leave entitlements to employees other than those leave entitlements the employees would have been entitled to under the Act if no ERO was in place.

Contract Cleaning Industry:

Annual leave entitlements remain unchanged in terms of normal leave accrual and are as per the Contract Cleaning Industry ERO. It provides for levels of annual leave equivalent to the statutory minimum and are based on employees who work at least 1,365 hours per annum. Part time employee’s annual leave entitlement is calculated on a pro rata basis. Thus, the ERO does not requiring the employer to afford additional leave entitlements to employees than they otherwise would have attracted under the Organisation of Working Time Act if there were no ERO in place. There has been changes in respect of Good Friday however. The proposed ERO does not require the employer to afford additional leave entitlements to employees other than those leave entitlements the employees would have been entitled to under the Act if no ERO was in place.

Since 1st October 2015, employees are entitled to public holiday terms in respect of Good Friday provided:

• they were employed prior to 2 August 2012, and/or
• they are entitled to such a rate in their contract of employment. However, for all other employees Good Friday will just be deemed a normal working day. In respect of public holidays, under the previous Contract Cleaning Industry ERO, employees were entitled to public holidays in line with the Act “exclusive of any qualifying number of hours required in that Act”. This latter sentence has been removed from the new ERO which now means, for example, that part time employees will be required to have worked 40 hours in the previous 5 weeks in order for public holiday rates to be applicable.

Early Childhood Education and Care:

The levels of annual leave provided for are the equivalent to the statutory minimum and are based on employees who work at least 1,365 hours per annum. Part time employees' annual leave entitlement is calculated on a pro rata basis. Thus, the proposed ERO is not requiring the employer to afford additional leave entitlements to employees than they otherwise would have attracted under the Act if there were no ERO in place. Employees' entitlements are those that they would have received under the Organisation of Working Time Act if there had been no ERO.

Employers are legally obliged to maintain comprehensive records for each employee that contain:

• the name, address, PPS Number of the employee and a brief statement of the employee’s duties. Reference to the employee’s job description or job classification is acceptable, for example Grade 2 Officer or HR Manager
• a copy of the employee’s contract of employment or offer letter which complies with the requirements of the Terms of Employment (Information) Act, 1994
• records of the days and total hours worked each week by the employee. Records of any days and hours of leave taken (annual or public holidays), and payment made in respect of them to the employee in any given week
• records of any additional days’ pay made to the employee in respect of public holidays, if the employee was required to work on a public holiday occurring in any given week. If applicable, these records should be accompanied by copies of the 14-day notification to work letter provided by the employer to the employee and any notices that were posted conspicuously in the employer’s employment of the requirement for the employee to work on the public holidays
• a copy of the notification provided to the employee by the employer, at least 24 hours before the first day, of the start and finish times on each day, or as the case may be, the day or days concerned, to be worked in each week by the employee. This requirement applies if neither the employee’s contract of employment or offer letter specify the normal start and finish times of work.

Where an employer does not use a clocking in system to record each employee’s daily and weekly working hours, the employer must use a form which meets the Minister’s requirements. Should an employer introduce a working time form, with both parties’ agreement, the employee may complete it on a daily or weekly basis.