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images3UV0EBFTThe Workplace Relations Commission (WRC) aims to secure compliance with employment rights legislation through inspection and prosecution services.  These services were formerly operated by the National Employment Rights Authority (NERA). Under the Workplace Relations Act 2015, which came into effect on 1st October 2015, the WRC monitors employment conditions through its Inspection Services to ensure the compliance and enforcement of employment rights legislation.

The WRC  can carry out an inspection of your workplace in one of 3 ways:

  1. by prearrangement
  2. at any time following a complaint from an employee (16% of the 2013 inspections)
  3. at random

And the WRC is busy – there were 5546 inspection cases completed by NERA in 2013 – 18% up on 2012 – all aimed at ensuring compliance.  (Expect a similar number for 2014 – NERA’s 2014 report is yet to be published but InsightHR will look closely at it once it is!)

So what does compliance look like?  What is the WRC’s actual goal?  A core element of compliance is the requirement for employers to have proper record keeping.  To aid employers in assessing whether or not they are in conformance from a record point of view, the WRC has published an employer‘s checklist.  The checklist is on page 13 of their Employer’s Guide to NERA Inspections.  If you can tick all the checkboxes it is more than likely that your organisation will have met its “legal obligations in relation to record keeping, provided the records are maintained and presented for inspection in an appropriate format”.

Note though that paperwork alone does not suffice.  Verification is also required – typically achieved by the WRC inspector interviewing a sample of employees.

It is important to realise that cooperation with the WRC is not optional.  As an employer you cannot hide from the WRC.  If the WRC wishes to inspect your organisation then it is legally entitled to.

There is no need to be overly-concerned at receiving a notice of inspection.  In all likelihood you are not being targeted.  And, even if you feel inadequately prepared, it is surprising what can be accomplished in the days preceding an inspection.  Even if you are non-compliant it will be helpful to your case to be able to demonstrate that you have commenced a process towards attaining compliance and to be able to point to the changes that you have implemented.  Of course your efforts will carry more weight if they commence after reading this article rather than awaiting an inspection notice!

Any advance preparation you do could also reap another reward: An Inspection will typically last 2-3 hours but the WRC will stay onsite for as long as is necessary – and the length of time will depend on not just the volume of records but also on their quality.

A notice of inspection will include a proposed date and time.  If you have a valid reason as to why the inspection cannot be carried out at that time then you can contact the Inspector (named in the notice) to arrange an alternative – but not a cancellation.  (Obviously this does not arise in the case of unannounced inspections – though such unannounced inspections are typically only used to verify that young people are only doing work “which is not harmful to their safety, health, or development and does not interfere with their attendance at school”.   Similarly, the Inspector will presume that the inspection is to be carried out at your premises – as that is where you are required by law to keep your employment records.  If you wish to have the inspection carried out elsewhere you should issue your request to the inspector.

You may also want to have an expert present during an inspection for support and to assist you in dealing with the Inspector.  Having the expert present may enable you to resolve/clarify issues during the actual inspection.

This flexibility over date, time and venue is consistent with the WRC not wanting to use a heavy-handed approach.  Rather, the WRC seeks to gain compliance through the provision of information and through inspections.  There may also be associated follow-ups.  For example, if unpaid wages are owed, identified and demonstrably paid, then typically the case will be closed.    Not that you want to be in arrears on wages however – €824,052 in unpaid wages was recovered in 2013!

Also, if required, the WRC has the statutory power to prosecute employers.  Prosecutions were initiated in 2013 in just 84 or approximately only 1.5% of inspection cases.  But compare that prosecution rate to the overall compliance rate of 55%!  It is obvious that the WRC is loath to prosecute.  What the WRC wants to see in the absence of compliance is that the employer is genuinely working with them to achieve compliance.

The decision to prosecute is only likely to occur if the employer refuses to comply with the law and/or fails to cooperate with the process and/or is found to be repeatedly in breach of the law.  This is a path to be avoided – the cost of such non-compliance extends beyond the purely financial cost –there will be reputational damage in the case of conviction.  Employers will have difficulty attracting and retaining top people if they are publicly known to be non-compliant with employment legislation!

Employment legislation covers a broad spectrum of areas – but one of the core elements is pay.  Employment legislation sets the legal minimum hourly rates payable by employers.  But for many organisations there is more than just legislation to be considered.  Businesses in certain sectors will have to comply with Employment Regulation Orders (EROs) and Registered Employment Agreements (REAs).  And the WRC is tasked with ensuring compliance with such EROs and REAs.

The impact for employers?  Employers need to be mindful of whether they operate in a sector that is covered by a JLC – and whether there will be an associated ERO or REA.  Minister for Business and Employment, Ged Nash TD, signed two new ERO’s into effect on 1st October 2015 for the security and contract cleaning industries.  EROs for the other JLCs may well be published this year.

In summary, employment legislation is increasing in complexity – so compliance is no simple matter.  To explore any aspect of WRC inspections call Mary Cullen, Patrick Foley or Liam Barton on 056 770 1060 or email mcullen@insighthr.ie.

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