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That new law on working hours… April 30, 2019

Posted by Tomboktu in Business, Collective Bargaining, Employment Rights, Labour relations, Trade Unions, Workers Rights.
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Last week, we got two opposing views on whether the changes in the law on working hours are an improvement for workers. (The changes came into force in March.)

On Tuesday, Mandate’s communications officer, David Gibney, had an article on the Irish Broad Left for ‘yes’, and on Friday, two academics at the Kenny Business School in the University of Limerick, Juliet Mac Mahon and Tony Dundon, had an article in the Irish Times for ‘no’. (The article by MacMahon and Dundon does not refer to Gibney’s and the fact that their article was published a few days after his seems to be a coincidence rather than an explicit response to Gibney’s article.)

Gibney refers to five changes to employment legislation that came into effect on 4 March, but two are key to the problems that workers experience with working hours. One of them is an amendment to an existing section in the Organisation of Working Time Act 1997 that is labelled as being about zero-hours working practices. (The wording of the heading is changed by the amendment.) The other change is the introduction into the Act of a new section that regulates ‘banded hours’. On these two changes, he says that “Zero–hour contracts are banned in almost all circumstances” and “Workers are entitled to be guaranteed hours of work that reflect their normal working week.”

I think that the first of these claims is mistaken and the second is not as good as he says.

Zero hours

Understanding the first difference in our assessments, on zero-hours contracts, is a painful task. The relevant section of the legislation — section 18 of the Organisation of Working Time Act, both before and after the amendment — is a wojusly painful piece of English to read. (The Irish Human Rights and Equality Commission said: “Section 18 (and in particular the current subsection (2)) is a very complex provision and is written in a way that makes the law difficult to understand.“)

From zero to one

There are a number of amendments to section 18, but the one the probably underpins the view that the change is a victory is the following new subsection that has been inserted into section 18:

(2) In a contract for a certain number of hours of work referred to in paragraphs (a) and (c) of subsection (1), the number of hours concerned shall be greater than zero.

At first glance, this looks like it is a ban on zero-hours contracts. But there are two reasons why this is not a victory for workers. The first is the most obvious but the least important: the phrase “shall be greater than zero”. The number one is greater than zero and an employer who wants to get around the substance of the ban simply has to specify that the “certain number of hours” is a single guaranteed hour of paid work per week. The amendment changes the problem from zero-hour contracts to one-hour contracts. Technically a victory, but a hollow one.

The missing letter

The second reason why this amendment is not a victory for workers is the more important one. The source of that is the missing letter in the phrase “in paragraphs (a) and (c) of subsection (1)”. The missing paragraph, (b), provides an alternative to zero-hour contracts, namely “if and when” contracts. Mac Mahon, the lead author of Friday’s article in the Irish Times, was a member of an eight-strong research team undertook research (commissioned by the then Department of Jobs, Enterprise and Innovation) that was published in 2015 which found that in practice employers do not use paragraphs (a) and (c) but do use “if and when” contract under paragraph (b) to create a contract that is in practice equivalent to a zero-hours contract but — importantly — is not legally a zero-hours contract. Paragraph (b) is left unchanged by the amendment. This is the key point Mac Mahon and Dundon make in their Irish Times article last week, though there they use the term “casual” rather than “if and when”. (And, to add to the potential confusion, the paragraph (b) that causes the fundamental problem contains the phrase “as and when” rather than “if and when”.)

Normal hours

The second point on which I disagree with Gibney is his statement that the amended act means workers are entitled to be guaranteed hours of work that reflect their normal working week.

The source of the problem here is the practice of giving a worker a contract that says they will be provided with a certain number of hours — say, 15 hours per week — but providing (and possibly in reality expecting attendance for) longer hours, such as a full-time pattern. The expression of the problem arises when the worker has come to expect and rely on a full week of work with the corresponding full week of pay but a conflict occurs and the employer’s response it to cut the hours back to the minimum stated in the contract as a legal form of “punishment”.

The new law deals with this by creating a system of “banded hours”. The bands in the law are the following:
3 hours to 6 hours
6 hours to 11 hours
11 hours to 16 hours
16 hours to 21 hours
21 hours to 26 hours
26 hours to 31 hours
31 hours to 36 hours
36 hours and over.

The law provides that if your normal working pattern falls within in a particular band, then your employer cannot change your working hours to a total in a lower band without your agreement.

I would agree with Gibney in the view that this is a significant improvement on the previous situation. And he valuably points out that the previous situation was not a legally theoretical one. Workers in Dunnes Stores did have their hours cut to their contractual minimum after they came back off strike, with the consequent, and perfectly legal, severe cut in pay.

A smaller cut, but still a big one?

But there are two serious problems with the new law. The first is the bands. The use of bands creates a system where an employer can legally inflict a sizeable pay cut on a worker. The sizes of the cuts may not be as large as the one that Dunnes inflicted on full-time workers that it reduced to shifts of 15 hours per week, but the potential cuts are still big. For example, a worker in the seventh band who is working 35.5 hours per week would have a 12 per cent pay cut imposed if their hours were cut to 31 hours per week, the lower end of the band they are in. The potential cut rises to 21 percent for a worker in the second band (6–11 hours).

In my view, this system does not amount to a guarantee of hours of work that “reflect” a worker’s normal working week, or if in the world of employment lawyers it does, then the word “reflect” is too flexible and allows cuts that are too large. We need a law where the normal hours of work are what you are entitled to, and not a hours within a wide band.

On the other hand, Mandate was successful in securing a change to the first proposal on banded hours. The original bill contained four wider bands, which would have allowed much larger cuts than the final act permits. It was Mandate’s work that secured the less draconian measure that is now the law.

Loophole

The second problem with the new law on banded hours is that it creates an incentive for employers to switch away from full-time employment as a norm, including in particular those employers that have in the past exploited the lack of rules that would have prevented the abuse Mandate campaigned against in Dunnes. Currently, an employer who needs extra work to be done can typically expand the hours of part-time workers. (There can be exceptions to that. An example might be a sandwich bar that needs additional part-time workers to cover growing demand for a few hours each day at lunch-time.)

An employer who does not want to give their employees the greater rights that the new law provides can do so in a very simple way: hire more part-time workers rather than offer your current staff the chance to move to longer or full-time hours. Without a new corresponding legal right for part-time workers to expand their hours if extra work becomes available, then the introduction of banded hours could have the opposite effect of that intended and increase the number of workers with precarious, part-time employment.

— * — * —

The law on workers’ rights is a complex mess. Irish employment law — and conditions that apply to them — is spread over 20 separate acts and regulations (and many more if amending acts and instruments are counted). In places, the writing is complex and almost impossible to understand, even for employment lawyers. The law creates categories and makes distinctions that the people affected may not understand — worker versus employee, for example. Across the legislation some rights or obligations are given different names and are subject to different conditions in ways that have no rational basis — penalisation and victimisation, for example.

In the economy, paid work is undertaken in a wide range of contexts: part-time work, full-time work, freelance work, 9.00 to 5.00, shift work, hourly paid work, piece work, salaried work, long-term contract work, self-employment, temporary employment, permanent employment.

Laws on workers rights interacts with other laws in complex ways. For example, the law on banded hours has a band that straddles 19 hours per week, which is a key working week for determining if low paid workers are entitled to Family Income Supplement.

The power relations, economics, and working practices differ across industries and different groups of workers in those industries. Some employers exploit laws that are are legitimate when applied to one type of worker by applying it to other categories — the classification of Deliveroo workers in the UK as self-employed is an example that has been in the courts in the last few years.

Our trade unions set up the Nevin Economic Research Institute to provide a central, worker-friendly source of expert analysis of economic data and policy and to shift the ‘discourse’ in Ireland, north and south. We need similar expertise and sustained research and technical analysis in the complex area of employment law.

Comments»

1. Alibaba - April 30, 2019

About working hours mention, I read Dave Gibney’s article yesterday and couldn’t make head nor tail or it.

The reasoning of MacMahon and Dundon isn’t easy to follow too, but it strikes me as far more compelling and its forewarning is so true.

‘Research in Ireland and Britain shows many of these workers are not aware of the implications of signing such agreements; or, if they are aware, they are reluctant to question them.’

I couldn’t agree more your final sentence.

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2. Tomboktu - April 30, 2019

Since I finished writing this post, I spotted a very interesting blog post by Michelle O’Sullivan, who is another author of the UL study that the Department published in 2015, over on the TascBlog:

https://www.tasc.ie/blog/2019/04/16/zero-hours-work/

From the conclusion:

The effectiveness of regulations on zero hours and on-call work depend on a wide variety of factors including the coverage of workers, scope of issues and strength of enforcement. Overall, the laws introduced in the six countries have generally sought to regulate some of the features of non-guaranteed hours such as minimum notice, minimum shift hours and information to employees. None ban zero hours work completely, none provide workers with a guaranteed minimum number of hours and none provide workers with certainty over the scheduling of their hours.

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