Construction Wage Disputes Surge: A Warning for Irish Employers
Nearly €17,000. That’s the sum Kenplast Ltd. was recently ordered to pay a worker after a dispute over underpayment, a figure that underscores a growing trend of successful claims against construction companies in Ireland. This case, heard by the Workplace Relations Commission (WRC), isn’t an isolated incident; it’s a stark warning to employers about the increasing scrutiny of wage compliance and the potential financial repercussions of failing to adhere to Sectoral Employment Orders (SEOs) and basic employment law.
The Case of the Missing Payslips and Discrepancies
Plasterer Joseph Lennon discovered a “discrepancy” between his received pay and what was reported to Revenue. Initially provided with no payslips, and later with those containing “insufficient information,” Mr. Lennon took the unusual step of hiring his own accountant to investigate. This proactive approach proved crucial. The company’s initial assurances of compliance were quickly debunked, leading to a WRC hearing where Mr. Lennon’s evidence went “uncontested.” The adjudicator found Kenplast Ltd. in breach of the Industrial Relations (Amendment) Act 2015 and the Terms of Employment (Information) Act 1994, awarding compensation for unpaid wages, lack of a pension scheme, absence of sick pay and death-in-service benefits, and failure to provide a proper statement of terms of employment.
The Rising Tide of SEO Enforcement
The core of this dispute revolved around the SEO for the construction sector. Between November 2024 and May 2025, the minimum hourly rate for a craft worker was €22.24, yet Mr. Lennon was receiving €19.85. While a difference of €2.39 per hour might seem small, it quickly adds up, especially considering the potential for back pay claims. The WRC is demonstrably increasing its enforcement of these orders, and workers are becoming more aware of their rights. This is fueled, in part, by increased union activity and readily available information online.
Beyond Hourly Rates: The Hidden Costs of Non-Compliance
The Kenplast Ltd. case highlights that non-compliance extends far beyond simply paying the correct hourly rate. The substantial portion of the compensation (€10,000) related to the absence of essential benefits like pension schemes, sick pay, and death-in-service cover. These are not optional extras; they are legally mandated under the relevant SEOs. Employers who fail to provide these benefits are exposing themselves to significant financial risk. Furthermore, the cost of legal fees and the damage to company reputation should not be underestimated.
The Accountant as a Key Ally – For Both Sides
Interestingly, this case underscores the growing role of accountants in identifying and resolving wage disputes. Mr. Lennon’s decision to engage his own accountant was pivotal. Accountants are uniquely positioned to spot discrepancies between reported income and actual pay, providing crucial evidence for workers. However, this also places a responsibility on company accountants to ensure full compliance. The fact that the company accountant initially dismissed the concerns only exacerbated the situation.
What’s Driving This Trend? Increased Awareness and Proactive Enforcement
Several factors are contributing to the rise in these types of claims. Firstly, there’s a growing awareness among workers of their rights, driven by trade unions like the Operative Plasterers & Allied Trades Society of Ireland (OPATSI). Secondly, the WRC is demonstrating a willingness to investigate and enforce SEOs more rigorously. Finally, the increasing complexity of employment law makes it easier for employers to inadvertently fall foul of the regulations. The recent focus on Sectoral Employment Orders is a clear indication of this trend.
Looking Ahead: The Future of Wage Compliance in Construction
We can expect to see a continued increase in wage disputes in the construction sector. The WRC’s recent decisions send a clear message to employers: compliance is not optional. Furthermore, the introduction of automatic enrolment for pension schemes will add another layer of complexity and potential liability. Proactive measures, such as regular wage audits and robust payroll systems, are no longer a luxury – they are a necessity. Companies that prioritize compliance will not only avoid costly legal battles but also attract and retain skilled workers in a competitive market.
What steps is your construction company taking to ensure full compliance with SEOs and employment law? Share your strategies in the comments below!
