IPU Seminar Sunday 28 th February 2010 Negotiating Terms and Conditions of Employment Dermot Casserly Partner Beauchamps Solicitors

Introduction (i)Type’s of employment contracts (ii)Key provisions in contracts (iii)Changing Terms and Conditions (iv)Redundancy (v)Termination of Employment (vi)Other Opportunities (vii)Conclusion

Introduction Employer’s market Pharmacy sector? Supply and demand of qualified pharmacists General rule – only senior or highly sought after employees get to individually negotiate T&Cs Contracts of employment are sometimes described as “living contracts”…relationship changes over time Negotiation at commencement stage, during the contract and at the end of the contract

Employees have little or no legal rights until they have 12 months’ service (some exceptions) Employee “on risk” when they leave an existing job to take up new employment as can be dismissed for any reason or no reason during the probation period or up to one year’s service Once employee has over one year’s service, they are protected under unfair dismissals legislation

Type’s of contract Indefinite term contract of employment Fixed term contract of employment Specified purpose contract of employment Part-time contract of employment Employee normally better protected with indefinite term contract

Key Provisions The package The hours/duties/reporting structure Probation period Termination clauses Right to amend/vary contract

Package Salary Paid sick leave Holidays – 20 day statutory minimum Other benefits – pension provision, permanent illness cover, health cover, bonuses Shares/partnership Professional subscriptions

Other conditions Examine closely any restrictive covenants They are clauses which legally restrain you from working for a competitor or setting up in competition to your employer Avoid entering into restrictive covenants if at all possible

In current market better to have a long termination clause, e.g. 3 months Employer usually reserves the right to pay in lieu of notice If contract is silent – employee is entitled to reasonable notice

Changing to Terms and Conditions Starting point – review your contract of employment - is there a clause providing for variation of terms and conditions? Have you over 12 months’ service – protection from unfair dismissal Contractual position – one party cannot unilaterally vary the terms of a contract. There should be agreement/employee consent

If an employer implements a pay cut without employee agreement, the employer may be found to be in breach of contract Legal remedies – Payment of Wages Act claim, breach of contract claim, constructive dismissal If you agree to a pay cut – consider conditional acceptance such as: –Assurance as to security of position –Re-instate salary after specified period of time –Reduce hours/increase holidays in proportion to pay cut

Redundancy Legal entitlements –Right to notice (contractual or “reasonable”) –Right to statutory lump sum –Right to payment for accrued but untaken holidays Ex-Gratia –No entitlement to an ex-gratia payment unless there is existing custom and practice

Validity of Redundancy? –Selection criteria –Alternatives to redundancy –Consultation, consultation and consultation Remedies? –Unfair dismissal claim? –Compensation –Re-instatement –Re-engagement Time limit –Six months time limit (12 months in exceptional cases)

Employee must have two years’ service to qualify for statutory redundancy Statutory payments are quite low – two weeks’ salary per year of service (week’s salary capped at €600) plus an additional week Example: Employee with 3 years’ service entitled to a maximum statutory redundancy of €4,200

Termination of Employment Deal – employer agrees to pay a termination payment In return employee agrees to waive any legal rights and resigns by “mutual agreement” Components: –Termination payment –Reference –Holiday Pay –Confidentiality –Non-disparagement –Waiver of all rights

Other Opportunities Setting up own pharmacy? Buying out employer/partnership arrangement

Conclusion Employment contracts generally drafted in favour of employer Employees generally have little leeway to negotiate Difficult times for employers and employees – both parties should be flexible where possible Know your employment rights and contractual entitlements prior to any negotiation

Dermot Casserly Partner Beauchamps Solicitors Tel: