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Expat Briefing Editorial Team
27 August, 2014
New legislation recently enacted in Ireland will usher in substantial improvements to work permit rules with the aim of attracting more high-calibre expat information technology professionals to the country and driving economic growth. This feature summarises the changes being brought about by the Employment Permit (Amendment) Act 2014.
The new law has been delivered as part of the Irish Government’s Action Plan for Jobs and in particular the joint ICT Skills Action Plan developed by the Ministry of Jobs, Enterprise and Innovation and the Ministry of Education. The plan is targeting an increase the number of skilled ICT graduates available in Ireland through the education system as well as the employment permits system. According to the Government, the new employment permit system will help make Ireland the top global location for ICT skills and confirm the country’s status as “the internet capital of Europe”.
Existing Rules For Expat Workers
In general, non-EEA nationals must have a permit to work in Ireland. EEA and Swiss nationals do not need an employment permit.
The EEA consists of the 28 European Union member states together with Norway, Iceland and Liechtenstein.
Under the Employment Permits Act 2003 and the Employment Permits Act 2006 there are four types of employment permits: work permits, Green card permits, spousal/dependant work permits and intra-company transfer permits. The rules for each type of permit are outlined below.
Work permits are available for occupations with annual remuneration of EUR30,000 or more. They are normally granted for two years initially, and then for a further three years, after which a work permit may no longer be needed.
Work permits for jobs with annual remuneration below EUR30,000 are only considered in exceptional cases. These exceptions include students who have graduated in the previous 12 months and have been offered a graduate position from the Highly Skilled Occupations List and individuals with specialist language skills.
Either the employer or employee can apply for a work permit, based on an offer of employment. However, a “labour market needs test” is required with all work permit applications made by the employer. This test requires that the vacancy must have been advertised with the Department of Social Protection employment services/EURES employment network for two weeks and in either a local newspaper or jobs website for three days. If the post remains unfilled, the employment services office will decide whether a work permit is justified to fill the vacancy upon the employer’s request.
The green card permit is an employment permit for most occupations with annual remuneration of over EUR60,000 or certain occupations where there are skill shortages. It is also available for a restricted list of occupations with annual remuneration of EUR30,000 to EUR59,999. The eligible occupations list includes the following posts:
The green card permit is issued for two years and a renewal permit is not required. However, Green card holders must remain with their first employer for at least 12 months before changing jobs.
Holders of a Green card permit can have their spouses, civil partners and families join them immediately.
Employers or employees can apply for a green card permit, and there is no need for an employer to complete the labour market needs test. However, an employment permit will not be granted to companies if the granting of the permit would mean that more than 50% of the employees would be non-EEA nationals.
Spousal/Dependant Work Permit
Applicants are subject to rules similar to those for ordinary work permits in that they are subject to the labour market needs test and are subject to fees. Furthermore, they will not be considered for occupations listed as ineligible for work permits, which includes the following jobs:
Intra-Company Transfer Permits
The Intra-Company Transfer Employment Permit is designed to facilitate the transfer of senior management, key personnel or trainees who are foreign nationals from an overseas branch of a multinational corporation to its Irish branch. These permits are considered invaluable in the initial establishment of a foreign direct investment company.
The main attraction of this permit is that it facilitates the temporary injection of corporate or HQ personnel and also provides for such employees to stay on the foreign payroll. This can be desirable for the employee as it can ensure they retain certain benefits (e.g. foreign pension contributions).
An intra-company permit cannot, however, be used to permanently substitute the filling of a vacancy which otherwise would have resulted in a job opportunity in the domestic labour market.
Furthermore, in relation to employees remaining on a foreign payroll, the Government’s preference is for all permit holders to be employed, salaried and paid under an Irish employment contract. It therefore applies strict criteria in situations where employees remain employed by a foreign-based employer.
Intra Company Transfer Employment Permits are strictly limited to the following eligible positions:
Senior Management refers to an employee primarily having one of the following functions:
Key personnel refers to persons working within an organisation who possess specialist knowledge essential to the establishment’s service, research equipment, techniques or management.
At the cessation of the employment or when the permit expires the employee/transferee in question must return to their country of origin. However, after holding an Intra-Company Transfer Employment Permit for one year an employee may apply for an alternative employment permit e.g. a Green card or a work permit.
The New Employment Permit
According to the Government, the new Employment Permit system has been designed with flexibility in mind in response to a rapidly changing labour market, work patterns and economic development needs. It is said that the “robust” new system provides clarity and certainty to potential investors and employers, both domestic and multinational, to enable them to better plan their employment needs.
The new law also addresses recent deficiencies in employment legislation identified by the High Court, which have the potential to allow employers to benefit from illegal employment contracts in situations where an employee does not hold an employment permit but is required to do so.
There are nine different purposes for which an employment permit may be granted under the new legislation. These are:
However, the Employment Permit (Amendment) Act retains and extends the requirement for a labour market needs test, with certain grounds for waiver including an exemption for applications for Critical Skills Employment Permits.
The requirement that at least 50% of an enterprise’s employees must be Irish or EEA nationals where an employment permit is to be issued is also retained and extended under the new law, although provisions have been made for this requirement to be waived for enterprise start-ups for a designated period.
Publishing the legislation in April 2014, Minister Bruton said:
“The legislation… will make a major contribution to the overall reforms we are delivering in the employment permits area. It codifies and clarifies the law in this area to make the system more transparent and obligations clearer to businesses and other stakeholders. It also makes the system more flexible and responsive to changing economic circumstances, so that our employment permits system can respond quickly and allow our economy benefit from quickly-emerging opportunities.”
“The law also addresses deficiencies in the law identified by the High Court in the Muhammad Younis case, and makes sure that employers cannot benefit, at the cost of the employee and his/her employment rights, from situations where employment contracts cannot be enforced because an overseas employee does not hold an employment permit. When this case first emerged I was appalled at its facts and pledged to move to remedy the law in this area – this legislation will deliver on this pledge”.
The changes have generally been welcomed by business associations in Ireland, including the American Chamber of Commerce Ireland. “Broadening the talent pool strengthens our competitive offering and there will always be the need to attract highly skilled individuals from overseas to work in Ireland,” the Chamber said of the proposed legislation earlier this year. “Streamlining the Employment Permits process is strategically important as it will make it easier to address short term skills deficits while at the same time positioning Ireland to attract the best global talent.”
Others however, are more cautious, preferring to wait and see how the new system works in practice before issuing judgment.
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