Welcome to the final day of our 12 Days of Christmas series! After an eventful 2018, today the Employment & Benefits team takes a look towards the year ahead, sharing their predictions for topical employment and pensions issues for 2019.
1. Breach of restraint of trade clauses
Restrictive covenants in Ireland are considered a contractual matter between an employee and an employer. As the economy continues to boom, movement within the jobs market continues to heat up and we have witnessed an increase in queries and litigation related to the enforcement, or otherwise, of contractual restrictive covenants. In the absence of specific legislation, carefully drafted and well thought-out restrictive covenants offer the best protection to employers seeking to restrain staff from jumping ship to their competitors.
2. Sexual harassment
Over the course of the past year, the momentum of the #metoo movement has continued, with several more high-profile sexual harassment cases widely reported in the media in 2018. The fight against sexual harassment looks set to continue and while most employers are aware that they bear a responsibility for protecting their employees from unwanted sexual comments and attention, not all are proactive in this area. Employers need to have more than just a piece of paper outlining a sexual harassment policy; they must implement preventative measures to avoid sexual harassment taking place and take active steps to ensure that all staff members are aware of the contents of the policies in place. A clear line of communication must be available, and a no-tolerance policy adopted throughout every company, big or small. Support from the top can go a long way in setting the culture in this regard.
3. Parental Leave
The EU Commission has cited caring responsibilities as the reason for 20% of the unemployment of women within the EU (as opposed to 2% of men). It is hoped that measures such as the proposed extended Parental Leave scheme under the Parental Leave (Amendment) Bill 2017 and the Shared Maternity Leave scheme that has been put forward under the Shared Maternity Leave and Benefit Bill 2018 will be positive steps in the move towards a better work-life balance. With both Bills at the third stage of Dáil Éireann, employers can begin to consider how they will introduce these new measures in their workplace in the New Year.
4. Gender Fluidity
The idea of gender neutral bathrooms at work may not be in the plans for a lot of employers, but as gender diversity becomes more understood, it is clear that adaption and inclusion will be big topics in the year to come. A number of Irish employers have introduced gender neutral bathrooms and changing areas in the workplace. Given that gender identity can be an emotional topic, employers should be aware that the topic should be treated in an appropriate and sensitive manner. Practically speaking, this means more than just a gender-neutral bathroom or changing facility, it means easily amending a personal file or ID card if required and having a zero-tolerance policy of bullying and derogatory remarks. As the workplace strives to become a more inclusive environment this is likely to be a topic that we will see more of in 2019.
5. IORP II
The IORP II Directive has a deadline for transposition of 13 January 2019. It is expected that the Irish legislature will publish transposing Regulations in early 2019. The Pensions Authority is also expected to issue supporting guidance materials. For many schemes IORP II will require them to completely revise how they approach scheme governance. We intend to schedule a client briefing on IORP II early next year to support trustees and sponsors in addressing the new requirements IORP II will introduce.
The Government is set to finalise the design of the proposed auto-enrolment system for Ireland by Q1 of 2019. This is a promised action point in the Government's "A Roadmap for Pension Reform, 2018-2013" (the "Roadmap"). In finalising the design of the proposed system it will be interesting to see whether Government has taken on board the concerns raised by many on that proposed design during the recent consultation process.
7. Defined Benefit (DB) reforms
Proposed reforms for DB schemes were included in the pre-legislative draft of the Social Welfare Pensions and Civil Registration Bill 2017. However. these proposals, which included a provision empowering the Pensions Authority to impose a statutory debt on employers in certain circumstances, were later dropped. Speaking in the Dáil on 14 November 2018, Minister Doherty reiterated her intention to re-introduce the DB reforms to the Social Welfare Pensions and Civil Registration Bill 2017 which have been held up at Committee Stage for the last year or more. Employers with DB schemes should watch out closely for these developments in 2019.
8. EIOPA/ECB reporting
New reporting requirements for pension schemes have been introduced by EIOPA and the ECB. EIOPA’s requirements for quarterly reporting will apply from Q3 of 2019. The first reporting deadline for the ECB is end of Q4 2019. The Central Bank of Ireland has published a list of pension schemes that the ECB requirements will apply to, and any scheme not on the list has been granted a derogation. The Pensions Authority has also contacted all Registered Administrators regarding the data collection process. We expect Registered Administrators will be in contact with schemes affected by this process during 2019.
9. Equal pensions treatment
Reforms to deal with the case of Parris v Trinity College Dublin (which we wrote about here) had previously been included in the pre-legislative draft of the Social Welfare Pensions and Civil Registration Bill 2017 but were later dropped (along with the DB reforms mentioned above). The Social Welfare, Pensions and Civil Registration Bill 2018 now includes new provisions to deal with the Parris case. The Bill may have limited application in practice to certain DB schemes with so called "death bed marriage" rules. This Bill passed its final stages in the Dáil and Seanad on 18 December 2018 and at the time of writing is awaiting presentation to the President for signing into law.
10. Master trusts
The Pensions Authority carried out a consultation on the proposed regulation of master trusts in Ireland which ended on 5 October 2019. The Government's proposals are related to IORP II and auto-enrolment. Master trusts are viewed as a possible vehicle for the roll-out of auto-enrolment and as a solution to consolidation of DC schemes in Ireland (which may be accelerated by the increased governance requirements of IORP II). Accordingly, this topic is likely to stay on the agenda for 2019.
11. Ombudsman regulations
New Year's Day 2019 will mark the first anniversary of the commencement of the Financial Services and Pensions Ombudsman Act 2017. This Act repealed the sections of the Pensions Act 1990 which had governed the former office of the Pensions Ombudsman and revoked the related Regulations made under it. Regulations have not yet been published under the Financial Services and Pensions Ombudsman Act 2017 to deal with topics such as Internal Dispute Resolution (IDR). If Regulations are published in 2019, trustees may need to update their IDR procedures accordingly.