The Employment Rights Compliance Bill 2008, which will place the National Employment Rights Authority (NERA) on a statutory footing is expected to be enacted before the end of July 2009. At present, NERA is operating on an interim basis and the Inspection services staff of almost 90 labour inspectors are conducting regular inspections at places of employment, under powers derived from existing employment rights legislation. NERA's quarterly review for the first quarter of 2009 was recently published on the NERA website, and states that in the first three months of 2009 it conducted 4,570 calls, interviews and inspections and collected over €471,328 in arrears due to employees.

NERA's review further confirms that the sectors in which most inspections took place, and consequently the highest number of breaches of employment law detected and the highest level of arrears recovered, were catering, construction, contract cleaning and retail grocery. In the first quarter of 2009 NERA referred 43 cases to the Chief State Solicitor's office for prosecution following the detection of breaches of employment law during their inspections.

Forthcoming targeted inspection campaigns

NERA conducts targeted inspection campaigns and current campaigns are targeting contract cleaning as a sector. In addition NERA is targeting employers in all sectors seeking compliance with the National Minimum Wage Act 2000.

The Tanaiste recently announced that changes are to be made to The Employment Permits Act 2006 to restrict the categories of eligible workers for permits. NERA's Inspection Services intend to shortly commence targeted inspection campaigns seeking evidence of compliance with the newly restricted employment permits regime once that legislation is enacted. (Click here for our recent article detailing changes to the Employment Permits Act 2006.)

NERA Inspections – recent trends

A NERA inspection usually involves a physical inspection of a sample number of records at a place of employment. In most cases the inspection will be by prior notification and such notification may commence by way of telephone call, email or formal letter of notification of inspection. An employer in receipt of such a communication should be aware that any reply to such a communication forms part of a statutory investigation and may have serious consequences for the employer in the event that the inspector forms the view that employment rights legislation has been breached. Furthermore, a request to send documents to a labour inspector may give rise to data protection issues in certain circumstances. The Employment Law Compliance Bill includes a provision that the furnishing of records to the Director of NERA shall not be precluded by any rule of law prohibiting or restricting the disclosure or communication of information, however, no such provision exists under current employment legislation.

Business Impact

In the event that an employer receives either a formal letter of notification of a NERA inspection, or an informal email request for employment records, it is important to establish the particular legislation under which the inspection is being conducted and the relevant timeframe for the employment records sought. Most records are required to be kept for a period of three years from the making of the record but this varies depending on the legislation concerned. Whilst one of the purposes of the Employment Law Compliance Bill, 2008 is to strengthen the powers of labour inspectors, currently they are restricted to operating within the powers set out in existing employment legislation.