Tuesday, 5 November 2019

Questions (1027)

Fiona O'Loughlin


1027. Deputy Fiona O'Loughlin asked the Minister for Employment Affairs and Social Protection if her attention has been drawn to companies that employ persons on 24-month contracts and terminate the contracts prior to the contract date, with pension investments being paid back to employers; and if she will make a statement on the matter. [44773/19]

View answer

Written answers (Question to Employment)

I have not been made aware of instances such as those referred to by the Deputy.

The Unfair Dismissals Acts 1977 to 2015 provide protection for employees from being unfairly dismissed from their jobs by laying down criteria on which the fairness or otherwise of dismissals can be judged, and by providing an adjudication system and redress for an employee whose dismissal has been found to be unjustified. The Acts apply to employees who (with certain exceptions) have had at least one year’s continuous service with the same employer.

If an employee considers that he or she has been unfairly dismissed, he or she may apply to the Workplace Relations Commission (WRC) for a hearing by a WRC Adjudication Officer of a case under the Unfair Dismissals Acts. If the Adjudication Officer finds that the dismissal was unfair, redress can take the form of financial compensation or re-instatement or re-engagement. A WRC Adjudication Officer's decision may be appealed by either party to the Labour Court.

The Pensions Act 1990, as amended provides for the preservation of retirement benefits for members of occupational pension schemes who leave employment before their normal pensionable age for any reason, other than death, provided they satisfy certain qualifying conditions.

Section 28 of the Pensions Act provides for an entitlement to the preservation of pension benefits where a person has completed at least two years’ qualifying service. If a person is a member of a pension scheme and has less than 2 years' qualifying service they may be obliged, when they leave service, to take a refund of the value of their own contributions less tax at the basic rate. In such circumstances, the employer contributions would be refunded back to the employer.

Some schemes may permit a person with less than 2 years’ scheme membership to leave their contributions in the scheme, even though they are not required to do so by law. Additional voluntary contributions (AVCs) are treated in the same way as main scheme benefits. Even if a person is not obliged to take a refund of contributions and have less than two years' qualifying service, they may still choose to do so.

The Pensions Authority is the regulatory body charged with the supervision of pension schemes and has the necessary powers under statute to investigate the conduct of a pension scheme should it become aware that a scheme is not in compliance with the provisions of the Pensions Act. Where a pension scheme member is of the view that the scheme is not in compliance with legislative requirements he or she may make a formal complaint to the Pensions Authority.

I hope the above clarifies the matter for the Deputy.