[Ireland] Navigating minimum wage increases

In Ireland, the government is expected to raise the national minimum wage from €13.50 to approximately €14.17 per hour later this year or early next, Lexology reports.

The pending rise follows a 5 per cent increase proposed by the Low Pay Commission, which the government is expected to accept.

This reportedly marks a further step toward a possible long-term goal of implementing a "living wage" rather than just a minimum wage.

Experts from international law firm Fieldfisher offered guidance for employers on how to proceed.

They said, “Such proposed increases typically trigger a predictable debate between employers' groups and unions/workers' rights representatives. As expected, it has sparked concern among small and medium-sized enterprises. Industry groups such as Retail Excellence and Small Firms Association warn that such cumulative wage increases – which some claim are 35% over 5 years - are unsustainable and may lead to reduced working hours, job losses, and increased insolvency.

“Leaving aside that debate, from an employment law perspective, it is important for employers, particularly in traditionally lower-paid sectors, to ensure that wages comply with applicable minimum thresholds. While this may be straightforward enough for hourly paid employees, it is less obvious for salaried employees, particularly where base salaries have not been increased for some time and also, for example, where a Sunday premium rate needs to be factored in.”

Even for employers in better-paid sectors who could expect not to be troubled by such increases, the experts reportedly cautioned that there may be some employees at the lower-paid end where a review may be required.

They said, “Statutory claims for underpayment of wages can be brought by employees to the Workplace Relations Commission (WRC), or, in more extreme cases, an employer can be subject to prosecution. 

“To mitigate such legal and reputational risks, employers who feel they may be exposed should audit current pay structures to ensure compliance with minimum wage rates.”

Source: Lexology

(Quotes via original reporting)

In Ireland, the government is expected to raise the national minimum wage from €13.50 to approximately €14.17 per hour later this year or early next, Lexology reports.

The pending rise follows a 5 per cent increase proposed by the Low Pay Commission, which the government is expected to accept.

This reportedly marks a further step toward a possible long-term goal of implementing a "living wage" rather than just a minimum wage.

Experts from international law firm Fieldfisher offered guidance for employers on how to proceed.

They said, “Such proposed increases typically trigger a predictable debate between employers' groups and unions/workers' rights representatives. As expected, it has sparked concern among small and medium-sized enterprises. Industry groups such as Retail Excellence and Small Firms Association warn that such cumulative wage increases – which some claim are 35% over 5 years - are unsustainable and may lead to reduced working hours, job losses, and increased insolvency.

“Leaving aside that debate, from an employment law perspective, it is important for employers, particularly in traditionally lower-paid sectors, to ensure that wages comply with applicable minimum thresholds. While this may be straightforward enough for hourly paid employees, it is less obvious for salaried employees, particularly where base salaries have not been increased for some time and also, for example, where a Sunday premium rate needs to be factored in.”

Even for employers in better-paid sectors who could expect not to be troubled by such increases, the experts reportedly cautioned that there may be some employees at the lower-paid end where a review may be required.

They said, “Statutory claims for underpayment of wages can be brought by employees to the Workplace Relations Commission (WRC), or, in more extreme cases, an employer can be subject to prosecution. 

“To mitigate such legal and reputational risks, employers who feel they may be exposed should audit current pay structures to ensure compliance with minimum wage rates.”

Source: Lexology

(Quotes via original reporting)