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Overview

Employees are entitled to a minimum paid annual leave entitlement of four weeks under the Organisation of Working Time Act, 1997 calculated in one of a variety of methods. Employers are permitted to offer holiday entitlements in excess of this amount and entitlements must be set out in the employee's written statement of terms and conditions. There are also a number of Public Holidays and Church Holidays which carry qualifying conditions if leave is to be taken. Holiday pay is payable at the employee's normal pay rate and is to be paid in advance of the holiday. If employees' pay fluctuates because of their particular pattern of work, an average of pay is to be taken over the preceding 13 weeks in order to reach a value for holiday pay.

Many employers adopt rules for the booking of annual leave in order to ensure that operational requirements are maintained to an acceptable level eg placing a cap on the number of employees who may be on leave at any one time. However, employers must take into consideration an employee's need to reconcile work with any family responsibilities and the need for rest and recreation.

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 an 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 ie 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, there is no restriction on employers using a different 12 month period provided the same leave year is used consistently. For example, many employers have amended this in order for their leave year to run from 1st January to 31st December 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 annual leave (in this case, 20 working days 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 the employer is determining the times at which an employee will be granted annual leave, the employer must consider the employee’s need to reconcile work and any family responsibilities coupled with the employee’s need for rest and recreation.

The employer must consult with the employee or his/her trade union not later than one month prior to the commencement of the leave. The employer must also ensure that the employee is granted the leave in the leave year to which it relates or within six months.

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 nine public holidays that fall in each calendar year as follows:

  • New Year’s Day (January 1st)
  • 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, he/she is 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 in the event that 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:

  • he/she is absent for a period of 52 weeks (or more) due to an occupational injury
  • he/she is absent for a period of 26 weeks (or more) due to illness or injury
  • he/she 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
  • he/she is absent due to a strike
  • he/she 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 criteria 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 is important to note that this decision and the Workplace Relations Act 2015 only apply to statutory annual leave and do not apply to additional or other leave i.e. service days or company leave. As there is a cap on how much annual leave can be earned by an employee in one year, sporadic and low-level absences from work will not affect a person's annual leave entitlement over 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 tightly managed to ensure that the employee either successfully returns to the workplace or there is 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.

The Organisation of Working Time Act, 1997 gives an employer the right to schedule annual leave for employees as long as one month’s notice is given by the employer as to when the annual leave is to be taken.

This also applies during a period of notice. The company can choose whether:

  • to schedule an employee’s annual leave to be taken during the notice period
  • to allow an employee to take annual leave during their notice period (where the employee has applied to do so)
  • to refuse an employee’s application to take the leave during the notice period and provide payment for the leave in the final wage payment instead.

This should be managed in a consistent way based on objective business requirements, to avoid treating employees unfairly.

An employee who is leaving employment has to receive the full annual leave entitlement for the period they have worked. For example, a full-time employee who works 37.5 hours per week 7.5 hours per day, Monday to Friday, resigns half way through the leave year.

The employee’s statutory annual leave entitlement for the year-to-date would be calculated as follows:

  • 37.5 hour week x 26 weeks worked in the leave year = 975 hours worked to date
  • 975 hours worked x 8 per cent = 78 hours of annual leave accrued for year-to-date
  • 78 ÷ 7.5 hour days = 10.4 days of annual leave accrued
  • employee’s annual leave entitlement for the year-to-date is 10.4 days.

If the employee has only taken 6 days annual leave in the year-to-date, then they have to receive pay equivalent to the remaining 4.4 days leave.

Where an employee has taken more than their entitlement, eg taken 14 days and their entitlement is only 10.4 days, then they owe the company the equivalent of 3.6 days of leave. However, the company is only allowed to reclaim this if they have previously informed the employee that they have to right to do so in the contract of employment/annual leave policy e.g. “When an employee is leaving the company, and the paid holidays taken exceed the paid holiday entitlement at the date of termination, the company will deduct the excess holiday pay from their final wage.” Otherwise the company must get permission from the employee to make the deduction.

The employee’s annual leave entitlement, and any days for which they were paid or had deducted on leaving, must be fully documented to avoid any future dispute.

When an employee leaves employment, and they have an entitlement to a Public Holiday benefit as per the Organisation of Working Time Act, 1997, the employee is entitled to receive payment from the employer for any Public Holiday occurring within the next 7 days after termination eg an employee finishes on a Friday and St Patrick’s Day falls the following Thursday.

The area of Employment Regulation Orders (EROs) and Registered Employment Agreements (REAs) has been quite contentious in Ireland in the last number of years with both being rendered unconstitutional in July 2011 and May 2013 respectively. Importantly, it was only those EROs and REAs that were drafted in accordance with the Industrial Relations Act 1946 that were rendered unconstitutional which means that any ERO introduced under the recent Industrial Relations (Amendment) Act, 2012 in respect of any particular industry will be valid and will bind all employers within those industries.

The EROs for both the Security and Contract Cleaning Industries came in to effect on 1st October 2015.

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 proposed ERO is 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.

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, in the event that 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.