An Employment Contract is an agreement between an employer and an employee that describes the terms and conditions of the job. It forms the basis of the working relationship by clearly outlining the terms and conditions of a job position, including compensation, vacation time, work duties, and other essential details. 

An Employment Contract may also be referred to as a: 

• Hiring contract 
• Work contract 
• Job contract

Employers, managers, and human resources professionals should use an Employment Contract when onboarding new staff. Importantly, employees in Ireland have the right to request a formal Employment Contract if one isn't initially provided.

Employees vs. independent contractors

An Employment Contract is not appropriate for an independent contractor or self-employed worker. Contractors are not the same as employees; they have different tax obligations and statutory rights. They act as their own boss, negotiate their working arrangements, and may work for multiple clients simultaneously. 

Contractors and self-employed workers should use an Independent Contractor Agreement to outline terms and conditions between the contractor and the client. 

Irish law requires all new employees to receive a Day 5 Statement of Terms (Section 3(1A) Statement) within five days of the employee’s start date. This document should include the core employment terms, including the following:

• Employers’ and employees’ full names 
• Principal place of business 
• Employee’s place of work 
• Title, grade, and category of work for the employee 
• Employment start date
• Probationary period conditions, if applicable 
• Contract duration
• Salary or remuneration
• Number of hours the employee should work per day and week 
• Any additional terms and conditions, including overtime 

The employer must also provide a Written Statement of Terms (Section 3(1) Statement) within one month of employment. This document should include:

• Employers’ and employees’ full names and the employer’s address 
• The right of an employee to request a written statement of their average hourly rate of pay
• Pay schedule, whether it’s weekly, fortnightly, or monthly 
• Terms and conditions relating to paid leave 
• Terms and conditions relating to incapacity for work due to injury or illness 
• Terms and conditions relating to pensions 
• Period of Notice or method for determining such 
• A reference to any collective agreements, if they affect employment terms
• A reference to any additional agreements, REA, or ERO 
• Training entitlement details 
• Identity of the user undertakings if the employee is a temporary agency worker 
• Any other relevant details if the employee’s work pattern is entirely or mainly unpredictable (due to the number of guaranteed paid hours)

While these statutory statements are legal requirements, a comprehensive written Employment Contract offers significant advantages for both employers and employees. 

It provides a legally binding framework that formalises the relationship, establishes clear expectations, and offers legal protection for both parties in the event of a disagreement. It's important to remember that, regardless of a formal contract, employees are always entitled to the minimum legal standards.

There are multiple types of employees. Understanding the different employment types is crucial, as each comes with specific entitlements. The Employment Contract should reflect these terms.

Full-time permanent

A full-time permanent position runs continuously until either party terminates it. These contracts are open-ended and have no end date. Maximum work hours are an average of 48 hours per week for adults 18 years or older.

Full-time permanent employees are entitled to paid annual, sick, and protective leave. 

Part-time permanent

Part-time permanent employees work fewer hours than comparable full-time employees. The hours can be set or casual, which means they are more sporadic. The Protection of Employees (Part-Time Work) Act, 2001, mandates that an employer cannot treat part-time employees less favourably than full-time employees.

It’s important to note that, in most instances, Ireland does not permit zero-hour contracts. Zero-hour contracts require you to be available for work for certain hours of the week, but your hours are not specified under the work contract, nor guaranteed. This may be overlooked in casual work, jobs done in emergencies, or during short-term relief to cover routine absences. 

Fixed-term 

A fixed-term contract is temporary and has a set end date. Fixed-term employees can be full-time or part-time depending on the company's needs. These contracts are often seasonal, frequently in the agricultural, tourism, horticultural, or construction industries. 

LawDepot's user-friendly template guides you through a simple questionnaire to capture all necessary details for a customised and legally sound Employment Contract.

Your Employment Contract should include details about the following:

1. Each party’s name and employer’s address (for agency workers, name the person or firm who hired the worker)
2. The place or places of work
3. The date the employment starts, and the end date if the contract is temporary or fixed-term
4. A brief job description with the title or nature of work
5. Payment details, including rate and pay intervals
6. Expected work hours 
7. Probation period conditions and duration, if applicable
8. Paid leave, holiday entitlements, and sick pay
9. Pension and pension schemes
10. A required notice to be given by the employer or employee before terminating employment
11. Any training to be provided by your employer

Ireland has several employment laws. Key legislation impacting Employment Contracts in Ireland includes:

Several key agencies and associations in Ireland also play a vital role in protecting workers' rights: Workplace Relations Commission (An Coimisiún am Chaidreamh san Áit Oibre) and Irish Business and Employers Confederation (IBEC). 

In addition to employment legislation, employees in certain sectors have specific industry agreements. The employer must include these in the Employment Contract.

Some Employment Contracts may include restrictive covenants, also known as restraint of trade clauses. These protect the employer's legitimate business interests by limiting specific employee actions during and after employment.

To be legally enforceable in Ireland, these clauses must be reasonable in scope and typically have limitations regarding time and geographical area.

For a restrictive covenant to be valid, it must:

• Be reasonable and necessary to protect the employer's legitimate interests.
• Not be detrimental to the public interest or local commerce.
• Not unduly restrict the employee's ability to earn a living.

Confidentiality clause

A confidentiality clause prevents employees from sharing or using an employer’s confidential business information. It functions similarly to a Confidentiality Agreement.

Non-solicitation clause

A non-solicitation clause prevents employees from soliciting or recruiting an employer’s clients, customers, or other employees. 

Non-compete clause

A non-compete clause prevents employees from using the employer’s information to gain a competitive advantage in the same field. The employer may also use a Non-Compete Agreement.

Circumstances may necessitate changes to an employee's contract during employment, such as adjustments to working hours, pay, or employment type.

No changes can be made to an Employment Contract without the employer and employee's mutual agreement and written consent (i.e., signature). Any amendments must also comply with the minimum legal standards.

Employers can efficiently implement changes to an existing contract using a Contract Addendum, avoiding the creation of an entirely new document.

If an employer or employee breaches the Employment Contract, the affected party usually has actions they can take to resolve the issue. The consequence will relate to the severity of the breach. 

Employer breaches

An employer’s breach of an Employment Contract may include unsafe workplace conditions, discrimination or harassment, lack of pay, or illegal practices. Employees can contact the Workplace Relations Commission (WRC) using their online complaint form to report their employer. 

When an employer breaches an Employment Contract, they may encounter the following consequences:

• Inspections for regulation compliance by the WRC
• Compliance notices from the WRC with instructions on how to adhere to regulations
• Fixed payment notice, which demands payment to the WRC of a specified amount within 42 days of the notice
• Adjudication hearings with the WRC if the employer is unable to comply with regulations and mediation is unsuccessful 
• Prosecution for ignoring fixed payment notices and non-compliance with the WRC

Employee breaches

Employee breaches might involve lateness, failure to perform duties, or unauthorised absences. These infractions may result in a warning from their employer that allows them to fix the behaviour and abide by the Employment Contract. 

Immediate termination may occur if employees continually breach their contract without fixing the issue. Similarly, an employer may terminate staff when serious breaches happen (e.g., workplace theft).

Either party in an Employment Contract can terminate it at any time. However, both parties must abide by the notice requirements according to the law. 

The statutory minimum notice period for employees who have worked for the company for more than 13 weeks is one week. For employment shorter than 13 weeks, no notice is required.

An Employment Termination Letter lets the employer end the original contract. Employers have different notice guidelines, as follows: 

If both parties agree on ending the employer-employee relationship, they can sign a Termination Agreement. This records the end of the original contract and ensures both parties are released from their obligations.