Money Mentor: Statutory obligations when hiring farm labour

Demand for farm labour has always been an issue, never more so than now, with the increases in the average dairy herd on farms. COVID-19 and the Pandemic Unemployment Payment (PUP) also have not helped. Sourcing and retaining farm labour is an ongoing challenge. Employment law and hiring employees involves employees’ rights as well as employers’ obligations as set down by the Workplace Relations Commission (WRC). This also covers the cost of labour.

Labour costs

Currently agricultural workers come under the remit of general employment legislation. Well-trained farm labour is not cheap. The current statutory minimum wage is €10.20 per hour (increased by 30c in Budget 2022, commencing 1 January 2022). In reality not many young trained farm labourers will work for the minimum wage.

An experienced dairy worker could earn anything from €600-€750 per week gross, (before tax and PRSI is deducted), depending on cow numbers and hours worked. This could work out at an equivalent of €13-€15/hour. These rates are generally exclusive of any meals or benefits. According to payscale.com the average gross pay for a farm worker is €27,000 per annum.

Experienced adult workers in Ireland are entitled to be paid a minimum rate per hour. There are, however, some exceptions to the minimum wage, including those employed by close relatives, those aged under 18 and trainees or apprentices.

Employer obligations

Before you hire anyone there are basic laws you need to be aware of such as, employment law, taxation law and health and safety. Your accountant, solicitor or an employment agency can also be of assistance. Also, it is no harm, before you hire a farm worker to write down what you expect of them – their role and tasks and the experience, skills and qualifications you are seeking.

As an employer, you will need to register with Revenue which involves online real-time filing of wage payments as they are made. The WRC will require detailed records of pay and hours worked and can inspect these records at any time. There are minimum periods for which these records must be kept, generally three years.

Health and safety considerations are vital to ensure a safe working environment and prevent accidents or injuries to employees, especially if specific training is needed.

A useful guide for employers is the Teagasc Farm Labour manual available on their website (teagasc.ie).

Employee rights

Under employment law, employees have wide-ranging rights and entitlements such as, statutory holidays of four working weeks per year and are not required to work anymore than 48 hours per week.

If any employee is employed for two continuous years or more, they are entitled to statutory redundancy equivalent to two weeks pay for each year of continuous service, between the ages of 16 and 66 + one further week’s pay. There is a ceiling of €600 on this per week. A week’s pay includes overtime and the value of any benefits-in-kind. Any redundancy costs paid are borne by the employer who are not entitled to a rebate on this and employees can take a case of unfair dismissal (if employed longer than 12 months), if unfair or constructive dismissal can be proven.

Dear Money Mentor,

I am a dairy farmer and I am considering employing a farm worker to help out with the milking. I milk 150 cows and I avail of the Farm Relief Services occasionally. I have a young family so I would like to have more free time.

I have considered robots but I am not sure they are totally suitable for my farm. Any advice would be welcome, in particular what my obligations would be under employment law.

Regards

Jim

Margaret writes

Hi Jim,

You have a big workload with 150 cows to milk each day. Taking on an employee might be the answer to help with that. There are many obligations on you as an employer, and rights for the employee involved here. You should seek professional advice from your accountant/adviser and solicitor to ensure you are aware of all of these. You will need to register with the Revenue as an employer.

One of the main obligations for you as an employer will be to ensure the employee is provided with a written statement of terms and conditions of employment, and to give the employee a written statement of pay (or payslip). You will also be obliged to pay employees not less than the statutory minimum wage rates and to comply with the maximum working week requirements. The employee will need to be registered for tax before they start. You will need to provide breaks and rest periods during working hours and provide annual leave from work. You must also maintain employee records of pay and hours worked. You will need to have a risk assessment or safety statement available and notify your insurers that you have taken on an employee.

Kind regards

Margaret

Teagasc is responsible for running programmes leading to Green Certificate qualifications which involves placement of students on suitable host farms. The recommended “expense allowance” paid to these student/trainees has not been updated since 2007, and therefore it can vary considerably what these students actually get paid while working a 35-hour week or more.

Having spoken to head of education at Teagasc Anne-Marie Butler, she confirmed that there is a review underway currently to help clarify this and it needs to be updated.

It is hoped this review will result in a recommended rate allowance to ensure host farms pay an appropriate allowance to these students.

College student placements (work experience) can be either paid or unpaid. If it is a paid placement, the expectation is the pay will be no less than the minimum wage.

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