On 13 April 2023, the Department of Enterprise, Trade and Employment (Department) approved and published a draft SI Sectoral Employment Order (Construction Sector) 2023 (the Order). What do you need to know?
When will the Order take effect?
The Order will come into operation on 18 September 2023. Further rises in minimum hourly rates of pay will then come into effect from 5 August 2024. The Order amends the Sectoral Employment Order (Construction Sector) 2021 as previously reported on by William Fry here.
To whom will the Order apply?
The Order will apply to workers in the construction sector, including craft persons, construction operatives and apprentices.
The Order follows from a Labour Court Recommendation. Such recommendations form part of the Sectoral Employment process as a statutory wage-setting mechanism based on the principles of collective bargaining.
The Order will create new statutory minimum pay, pension and sick pay entitlements for workers in the construction sector, including craft persons, construction operatives and apprentices.
These pay increases may potentially negatively impact the cost of development projects or works. Depending on how risk has been allocated under a construction contract, development agreement or agreement for lease envisaging works, this cost increase may be borne by either the developer or the contractor.
For more information or advice on how this impacts projects and construction contracts or forward sale, funding, acquisition of developments or works, please contact Cassandra Byrne, Jarleth Heneghan, Jeffrey Greene or your usual William Fry contact.