Employment Law in Gibraltar

Gibraltar is a British Overseas Territory. It is self-governing and has its own parliament, government, and legal and judicial systems. The UK is responsible for foreign affairs and defence. Gibraltarians are British citizens.

Employment legislation is largely based on that of the UK, though with various omissions, variations and additions. The main item of relevant legislation is the Employment Act 1932 which notably deals with employment contracts, sex discrimination, probationary periods, notice periods, unfair dismissal, collective redundancies, transfers of undertakings and protected disclosures. Regulations made under the Employment Act 1932 govern matters such as written information on terms of employment, maternity leave, parental leave, fixed-term contracts, part-time employees, temporary agency workers, employee information and consultation, trade union recognition and work permits.

The Employment Act 1932 empowers the Government — after consulting a statutory Conditions of Employment Board — to issue binding “conditions of employment orders”. These set minimum standard conditions of employment either for all employees or for a particular class or classes of employees. In the former case, such “general” orders have been issued that establish all employees’ minimum entitlements in respect of minimum wages, redundancy pay, sick pay, annual leave and public holidays. In the latter case, “particular” conditions of employment orders have been issued that establish certain minimum conditions for bus drivers and conductors, shop assistants and employees working in the retail distributive trade, wholesale trade, licensed non-residential establishments, transport contracting undertakings and the printing industry. While still in force, the particular orders have not been updated for many years (most recently in 2009) and their main significance now appears to be in setting overtime pay rates.

Outside the framework of the Employment Act 1932, the main employment-related laws are the:

• Working Time Act 1999

• Employment (Bullying at Work) Act 2014

• Equal Opportunities Act 2006

• Trade Unions and Trade Disputes Act 1947

• Factories Act 1956 and accompanying regulations, especially the Management of Health and Safety at Work Regulations 1996.

The other main sources of employment law are English common law, case law and employment contracts. Collective agreements also play a role in certain sectors.

As a result of the UK leaving the EU, Gibraltar too ceased to be part of the EU. EU law has not applied in Gibraltar since 31 December 2020. The Trade and Cooperation Agreement agreed to govern post-Brexit relations between the EU and the UK does not apply to Gibraltar, and negotiations over a similar agreement on Gibraltar-EU relations have not at the time of writing (April 2023) resulted in a deal. Since 1 January 2021, provisional ad-hoc arrangements have governed matters such as the Gibraltar-Spain border, customs, trade and the position of frontier workers.

• Before recruitment, employers must register all vacancies with the public employment authorities. Recruitment and Selection

• The first week of employment is deemed to be probationary and employment may be terminated at the end of the week by either party without notice. Recruitment and Selection

• Where an employer intends to engage an “entitled” worker — this category notably includes Gibraltarians and other British nationals — it must notify the public employment authorities about the terms of engagement, while it if intends to engage a “non-entitled” worker, it must obtain a work permit. Recruitment and Selection

• Within 14 days after the start of a worker’s engagement, the employer must provide them with a document setting out their main terms and conditions. Employment Contracts

• If an employer terminates a fixed-term contract early, it must pay the employee half of the wages due in respect of the remainder of the term, unless it is entitled to dismiss the employee without notice for reasons such as misconduct. Employment Contracts

• If an employee has been continuously employed on successive fixed-term contracts for four years or longer, they are considered to be employed on a permanent basis, unless the employer can justify another renewal of the fixed-term contract on objective grounds. Employment Contracts

• Employers must pay their employees weekly, fortnightly or monthly (depending on how their wages are calculated) and provide them with an itemised wage statement for each pay period. Pay and Benefits

• A statutory “standard” minimum wage applies to almost all employees aged at least 15 years. Pay and Benefits

• A worker’s total weekly working time, including overtime, must not exceed 48 hours, on average over a reference period of 17 weeks: however, workers may agree to opt out of the 48-hour limit and in certain circumstances the 17-week reference period may be increased to as long as 52 weeks. Working Time, Rest and Holidays

• Workers are entitled to a rest break of at least 20 minutes if their daily working time exceeds six hours, a daily rest period of at least 11 consecutive hours and an uninterrupted weekly rest period of at least 24 hours. Working Time, Rest and Holidays

• Employees are entitled to paid annual leave: for those working a five-day week, the full entitlement ranges from 15 to 25 working days, depending on length of service. Working Time, Rest and Holidays

• Working mothers are entitled to 14 weeks of maternity leave (two weeks of the leave are compulsory) and, if they have at least one year’s service, up to 26 weeks of additional maternity leave: the leave is unpaid but the employee may be entitled to a social security allowance. Parenthood and Work-life Balance

• Working parents with at least one year’s service are entitled to take four months of parental leave in the period up until their child’s fifth birthday, though no more than four weeks’ leave in any one year. Parenthood and Work-life Balance

• Employees with at least three months’ service are entitled in any 12-month period to two weeks’ sick leave on full pay from their employer, followed by four weeks’ sick leave on half pay. Parenthood and Work-life Balance

• Employers must not discriminate in relation to employment on grounds of the protected characteristics of sex (including marital or family status), pregnancy or maternity leave, racial or ethnic origin, age or age group, disability, religion or belief, sexual orientation or gender reassignment. Equality and Discrimination

• Harassment based on a protected characteristic constitutes unlawful discrimination, as does sexual harassment. Equality and Discrimination

• Employees have a right to form and to join, or not join, trade unions, and have protection from dismissal for various trade union-related reasons. Industrial Relations and Collective Rights

• There is a statutory mechanism whereby trade unions may obtain recognition from employers for collective bargaining purposes. Industrial Relations and Collective Rights

• Employers have a duty to ensure, so far as is reasonably practicable, their employees’ health, safety and welfare at work, and must comply with various specific health and safety obligations, while employees have certain duties and rights in this area. Occupational Health and Safety

• Employees have the right not to be unfairly dismissed and the employer must have a fair reason for dismissal — these mainly relate to the employee’s capability/qualifications, conduct or redundancy — act reasonably and follow a fair procedure, while there is a range of reasons for dismissal that are “automatically” unfair. Termination of Employment

• In most cases, employees must have at least 52 weeks’ service in order to bring a complaint that their dismissal is unfair, but employees dismissed for certain automatically unfair reasons may claim unfair dismissal without any qualifying period of service. Termination of Employment

• Employers and employees must, after the first week of employment, observe a minimum statutory notice period when terminating an indefinite-term employment contract, except where summary termination is warranted by the other party’s conduct. Termination of Employment

• Employees with at least one year’s service are generally entitled to service-related statutory redundancy pay if they are made redundant, capped at a maximum of one year’s pay. Termination of Employment

• An employer may dismiss an employee at or over the age of 65 on grounds of retirement but must consider any request by the employee to continue working beyond retirement, following a statutory procedure. Termination of Employment

• If the Employment Tribunal finds a dismissal to be unfair, it may order the employee’s reinstatement or re-engagement, or award compensation. Termination of Employment

• Employees must not be subjected to bullying in relation to their employment, and employers must implement a bullying at work policy meeting statutory requirements in order to avoid liability. Other Key Issues