SECTION 8(1)(A), ANTI-DISCRIMINATION (PAY) ACT, 1974
GALLAHER (DUBLIN) LIMITED,
(REPRESENTED BY THE IRISH BUSINESS AND EMPLOYERS' CONFEDERATION)
- AND -
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
Chairman: Ms Owens
Employer Member: Mr Brennan
Worker Member: Ms Ni Mhurchu
1. Appeal against Equality Officer's recommendation No. EP8/96.
2. The case concerns an appeal by 3 female members of the Union. The Company operates an annual bonus scheme directly related to profits and paid as a percentage of annual salary. The latest payment is in the order of 20%. There are certain conditions attached to qualifying for the bonus, one of which is attendance i.e. the first 3 weeks of any long term absence is excluded from the calculation in the case of illness and maternity leave. It is the application of the 3 week exclusion period for maternity leave which has given rise to the case, as the 3 workers believe that they are being discriminated against as women because maternity leave cannot apply to their male colleagues.
The Union's case is that under the Maternity Protection Act of 1994, a person availing of maternity leave is deemed to be still in employment and all rights to annual leave, increments, seniority etc. are preserved. To do otherwise would discriminate against one gender. By equating the discount of 3 weeks for absence due to maternity leave with absence due to sick leave is of itself discriminatory; one is exclusive to women while the other is common to both sexes.
Part of the Company's case is based on Section 22 of the Maternity Protection Act, 1994 which states that:-
"During the period of absence from work by an employee while on
(a) maternity leave
............ the employee shall be deemed to have been in the employment of the employer and, accordingly, while so absent the employee shall .....be treated as if she had not been so absent; and such absence shall not affect any right (other than, except in the case of natal care absence, the employee's right to remuneration during such absence)....."
On this basis the Company contends that no entitlement to bonus exists whilst one is on maternity leave as bonus is clearly remuneration.
The Company also cites the case of Gillespie and others v Northern Health and Social Services Board and other (C342/93) in which the European Court of Justice stated that there is no requirement under law for women to receive full pay during maternity leave.
The full background to the case can be found in EP8/96. The Equality Officer's recommendation is as follows:-
"I find that Gallaher (Dublin) Limited did not discriminate against the 3 workers when it excluded the first three weeks of their annual bonus.
(The 3 workers were named in the above recommendation)
The Union appealed the recommendation on 27th November, 1996, in accordance with Section 8(1)(a) of the Anti-Discrimination (Pay) Act, 1974, ('the 1974 Act'). A Labour Court hearing took place on 12th June, 1997
The kernel of the dispute in this case is the manner in which the Company calculates the amount of bonus payable to workers (including, in particular, the three claimants) who have been absent from work for a period of time on maternity leave.
Therefore, while the dispute is about 'remuneration', and whether the complainants are receiving 'equal pay', it is also about whether the claimants have suffered discrimination by being treated less favourably than their colleagues in the manner in which the bonus has been calculated, given that the lesser payment arises from their pregnancy-related absences from work.
The bonus payable by the Company to its employees is calculated as a percentage of the basic pay of the employees. It is discretionary, and is directly related to trading results. Payment is also dependant on attendance at work. There are special provisions for the payment of the bonus to certain categories of employees who, for one special reason or another, are not at work during the entire period of calculation for payment of the bonus. These categories include workers who have retired, workers who have died, workers who have been absent due to illness or injury, and workers who have been absent on maternity leave.
Calculation of the payment for each of the special categories is still related to their attendance at work. Pensioners and deceased workers are treated as if they had been in attendance during the whole of the year. In the case of workers in the other categories, a three week period is discounted, but otherwise the bonus is calculated on 'notional earnings'.
The Union argues, however, that since maternity leave is particular to women, the discounting of the period of calculation in relation to workers who have been absent because of taking maternity leave is discriminatory.
The Court does not agree with this argument. The grounds on which the Company pays the bonus at a lesser rate to workers who have been absent on maternity leave are, as with any other employee, absence from work. The same grounds are applied to workers who are absent due to illness. But in the case of both those categories of absences, the period of absence is 'allowed', apart from a three-week period. In the case of the other special category of absentees, namely retired and deceased workers, the entire period of absence is 'allowed'. Thus all the special categories of absent workers are to be paid the bonus, either in full, or with reductions calculated according to notional attendances. Far from treating the workers absent on maternity leave in a discriminatory manner, the Company treats them with the same level of favour as other workers absent for reasons related to involuntary and temporary incapacity for work.
The logic of the Union's position in this case is that the absence of workers on maternity leave should be disregarded or 'allowed' in full for the purposes of calculation of the bonus. The Court would point out that the decision of the European Court of Justice in the case of Gillespie and Others v Northern Health and Social Services Board and Others (C-342/93) of 13th February, 1996, has established that there is no requirement under the Equal Pay Directive for women on maternity leave to receive full pay during such leave. It would appear to this Court to be reasonable by analogy to say that there is equally no requirement to calculate an element of pay as if such women were actually in work.
With regard to the claim under the 1974 Act, the Court is satisfied that in so far as the claimants' remuneration is less than that of their colleagues who remain in work during the entire of the period during which the bonus is calculated, the difference in the amount paid is due to their absence from work, which the Court finds is grounds other than sex.
The appeal is dismissed.
Signed on behalf of the Labour Court
29th July, 1997______________________
Enquiries concerning this Determination should be addressed to Ciaran O'Neill, Court Secretary.