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Euro Currency

The National Minimum Wage Increase

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On the Up

As of February 1st, 2020, there will be an increase in the National Minimum Wage for employees over 20 years of age. The minimum wage for these workers has increased from €9.80 to €10.10 with immediate effect. It is advisable that you notify all employees currently receiving a minimum wage of this change before their next payslip to ensure that they know this change will be in effect immediately.

For all workers under the age of 20, there will also be an increase in line with the minimum wage guidelines. These new rates will be as follows:

  • Employees under the age of 18: €7.07 per hour.
  • Employees aged 18: €8.08 per hour.
  • Employees aged 19: €9.09 per hour.

Regina Doherty of the Department of Social Protection has said of the increase:

“Since 2016, a minimum wage employee working a 39-hour week has received a gross pay increase of €2,331. Since 2015, we have increased the minimum wage by 13.2% ahead of the rate of inflation.”

There is still a way to go before we are on par with the current living wage estimate of €12.30 per hour, but any increases are of course a step in the right direction for low-income workers and their families with our ever-increasing cost of living as we continue to see working people living under the poverty line. Chief Executive of Social Justice Ireland has stated that Ireland has one of the highest rates of low-paid employment in the OECD (The Organisation for Economic Co-Operation and Development).

It is also advised that in light of these increases, employers should take a look at their current rates for Sunday work as legislation states that employees should receive reasonable compensation for this work, whilst the amount is not specified it is suggested that a 25% premium may find its way into legislation and it may be wise to follow this template going forward.

Should you have any concerns or queries on any business or financial matters, please don’t hesitate to contact us here at EcovisDCA where we are always happy to help.

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~ DCA PARTNERS, DECLAN DOLAN & EAMONN GARVEY

Bank Holiday Payment Entitlements

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Time Marches On

March is always a strange month, whilst January can seem endless and February spins by before you’ve even adjusted to writing the New Year on your documents, March somehow signals that more time has passed in the current year than we could have realised. One bonus that comes along with March for those of us working away on our fair green Isle is that it offers us our first little break in the year in the guise of parades and fairs celebrating our patron saint.

One thing to be aware of however is that occasionally, as was the case this year, the Public Holiday may not fall on the traditional Monday associated with a Bank Holiday. In this scenario there are a number of ways to tackle the change and we thought it prudent to give information on who may be entitled to Bank Holiday payment.

Contrary to popular opinion, there is not an automatic entitlement to the Monday following the 17th of March off, but it does usually suit business operations to proceed in this manner.

The entitlement for full-time employees is as follows:

  • A paid day off either on the public holiday, or the following Monday for those who work Mon-Fri when the public holiday falls outside of the standard.
  • An additional day of annual leave
  • An additional day’s pay in this pay round.
  • A paid day off within a month of the Public Holiday.

It is also not always widely known that the employee is entitled to ask which options apply to their circumstance 21 days before the Public Holiday, and should the employer fail to respond within 14 days of the holiday, the employee then becomes automatically entitled to take the Public Holiday as a paid day off. It is advised to communicate this to your employees well in advance in order to avoid confusion on either side.

The entitlement for part-time employees is as follows:

  • Employees who have not worked at least 40 hours in total in the 5 weeks prior to the Public Holiday to not meet the minimum requirement to avail of their Public Holiday entitlements.

The payment options for a Public Holiday are as follows:

  • If the employee works on the Public Holiday they are entitled to payment for that day worked, as well as an additional day’s pay equivalent to the last day worked prior to the holiday.
  • If an employee normally works the day that the Public Holiday falls on they are entitled to the day off and their normal day’s pay.
  • If an employee does not normally work on the day the Public Holiday falls and is not required to work on this date, they are entitled to one-fifth of their normal wage.
  • Employees on sickness and maternity leave will also have entitlement as though they worked on this day.

We hope that you all enjoyed the first Public Holiday of the year and that this information will be of use for those still to come. Should you have any queries or concerns on any business or financial matters, please don’t hesitate to contact us here at EcovisDCA, where we are always happy to help.

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~ DCA PARTNERS, DECLAN DOLAN & EAMONN GARVEY

When a Squeeze Becomes a Pinch

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The term ‘middle-class squeeze’ refers to the situation wherein increases in wage do not equate with inflation rates for middle income earners and the cost of living continues to increase. This leads to a perceived decline in actual wages which seems to primarily affect this middle level income earners. The ‘squeezed middle’ is something that we hear in general and political conversation quite a lot in Ireland these days as the issue continues to heat up alongside the ever increasing housing prices (both rental and purchase) and the increases in the cost of living.

In recent days, Junior Finance Minister Michael D’Arcy has taken note of these ongoing conversations and complaints and stated that this ‘squeezed middle’ are in dire need of some manner of assistance, going as far as to suggest that a third ‘middle’ rate of tax is now being considered. D’Arcy was quoted as saying:

“People accept at this stage the people in the working middle need to get something back. So what we now have to do is to help people who are in that mid-range. Both the Taoiseach and the finance minister are extremely eager to do something there. There is a train of thought that there should be a third middle rate of tax between the two rates at a lower space. We have to reduce the burden of income tax on those people.”

This will be welcome news to anyone currently floundering in the squeezed middle. The Junior Minister went on to outline that that this new tax level will rest somewhere in between the top and lower standard rates, stating that the entry point to the higher rate which is currently €33,800 is “damaging” to job creation as workers earning less than the average industrial wage (€45,075) can still be paying the top level of tax, which is an anomaly that seems to only be faced here.

Junior Minister D’Arcy also damned the culture of “welfare dependency” which has sprung up in Ireland as a result of these issues, with tax levels and the cost of living leaving many to believe that they will earn more on welfare than working when the cost of travel etc. is factored in and suggested that the strategy from this point will be to make sure that work done is paid for appropriately, and to possibly introduce this new tax bracket to allow mid-level earners to take home enough pay to live more comfortably.

As always we are available for any advice or guidance you may require on business or finance matters.

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~ DCA PARTNERS, DECLAN DOLAN & EAMONN GARVEY