Updating the SEO for the Construction Sector

The new SEO, which is the fifth of its kind since the first SEO issued in 2017, was the result of an application by five trade unions to the Labour Court, who sought a review of pay, pension, and sick pay entitlements for various construction sector employees. Following a comprehensive examination of the proposal, including public hearings and submissions from interested parties, the Labour Court recommended the SEO to the Minister for Business, Employment and Retail (the Minister). The Minister presented the SEO to the Oireachtas for approval on 6 November 2024 noting that the SEO will play a significant role in supporting the construction sector by maintaining harmonious industrial relations. The Minister also acknowledged the importance of a SEO which in her view is to ensure that during economic downturns, workers are properly protected, and the sector maintains its attractiveness as a profession for apprentices. The Oireachtas approved the SEO on 7 November 2024. 

Terms of the SEO

The SEO will amend Sectoral Employment Order (Construction Sector) 2023, S.I. No. 207 of 2023 which came into effect on 18 September 2023 (for details on the 2023 SEO please click here). Below we summarise the salient provisions of the new SEO which will take effect on 1 August 2025. 

Minimum hourly rates of basic pay

Apprentices will be entitled to the following percentages of the minimum pay rate applicable for the relevant year (1 August 2025 to 31 July 2026 and from 1 August 2026):

In addition, a minimum hourly rate of basic pay of €16.74 will apply for two years after entrance to the sector to all new entrant operative workers who are over the age of 18 years and entering the sector for the first time. From 1 August 2026, this will increase to €17.28. 

Minimum pension contributions

Sick Pay

The weekly contribution with effect from the date of the coming into operation of the SEO is as follows:

• Employer €2.37
• Employee €0.63

Key Takeaways

• Approximately 46,600 construction workers in Ireland will benefit from increased pay, pension, and sick pay entitlements under the new SEO..
• It is hoped that the SEO will make the sector more attractive for new workers; an imperative as Ireland seeks to increase its housing and infrastructure projects for which skilled workers will be required. 
• Contractors should be cognisant of the costs in labour when tendering for projects. 
• Employment contracts should be updated for relevant workers to ensure that they adhere to the terms of the SEO.