Tip of the Week - Navigating Ireland’s Minimum Wage Increases: Employers – make sure you're compliant.

This follows a 5% increase proposed by the Low Pay Commission, which the government is expected to accept. This marks another step toward a possible long-term goal of implementing a "living wage" and not just a minimum wage.

Such proposed increases typically trigger a predictable debate between employers' groups and unions / workers' rights representatives. As expected, it has sparked concern among small and medium-sized enterprises. Industry groups such as Retail Excellence and Small Firms Association warn that such cumulative wage increases – which some claim are 35% over 5 years - are unsustainable and may lead to reduced working hours, job losses, and increased insolvency.

Leaving asie that debate, from an employment law perspective, it is important for employers particularly in traditionally lower paid sectors to ensure that wages comply with applicable minimum thresholds. While this may be straightforward enough for hourly paid employees, it is less obvious for salaried employees, particularly where base salaries have not been increased for some time and also, for example, where a Sunday premium rate needs to be factored in.

Even for employers in better paid sectors who might expect to be untroubled by such increases, there may be some employees at the lower paid end where a review may be required.

Statutory claims for underpayment of wages can be brought by employees to the Workplace Relation Commission (WRC), or, in more extreme cases, an employer can be subject to prosecution.

To mitigate such legal and reputational risks, employers who feel they may be exposed should audit current pay structures to ensure compliance with minimum wage rates.

The above is for general guidance only and is not intended as professional advice. Advice should always be taken before acting on any of the issues identified. Please contact Barry Walsh, Greta Siskauskaite or Paul Bruun-Nielsen should you require specific legal advice on this area or indeed any employment law issues.