ADJUDICATION OFFICER DECISION
Adjudication Decision Reference: ADJ-00000527
Complaint(s)/Dispute(s) for Resolution:
Complaint/Dispute Reference No.
Date of Receipt
Complaint seeking adjudication by the Workplace Relations Commission under section 13 of the Industrial Relations Act, 1969
Date of Adjudication Hearing: 08/08/2016
Workplace Relations Commission Adjudication Officer: John Tierney
In accordance with Section 41(4) of the Workplace Relations Act, 2015 [and/or Section 8(1B) of the Unfair Dismissals Act, 1977, and/or Section 9 of the Protection of Employees (Employers’ Insolvency) Act, 1984, and/or Section 79 of the Employment Equality Act, 1998, and/or Section 25 of the Equal Status Act, 2000] following the referral of the complaint(s)/dispute(s) to me by the Director General, I inquired into the complaint(s)/dispute(s) and gave the parties an opportunity to be heard by me and to present to me any evidence relevant to the complaint(s)/dispute(s).
Complainant’s Submission and Presentation:
My Employer made changes to the PHI Policy which has resulted in a loss in benefit from 66% to 50%. I was not informed of the changes. This entitlement has been part of the Claimant’s terms and conditions since 1987. There was no consultation or agreement with the Claimant’s union in respect of this change.
The Claimant had a legitimate expectation that his entitlement would continue.
Respondent’s Submission and Presentation:
The Respondent’s business suffered badly during the financial crisis. It went from a modest profit of €30m in 2008 to losses of €230m in 12 months. Despite efforts to save including pay freezes, branch closures and redundancies, losses continued to grow. Ultimately, in 2012 the business had to be recapitalised to the tune of €4 billion of taxpayer’s money. Part of the business had to be sold off.
As part of the recapitalisation the Minister for Finance gave an instruction to cut the cost of remuneration and benefits by 6 – 10 %. This was achieved through on-going pay freeze, closure of the pension scheme and withdrawal of other benefits.
The cost of maintaining the Income Protection Benefit (IPB) was €860,000 which could not be sustained. Eventually by cutting the existing benefit from 66% of salary to 50% brought the cost down to €580,000. The Respondent stated that they had no choice but to cut the level of benefit the same all other areas to save money.
Section 41(4) of the Workplace Relations Act 2015 requires that I make a decision in relation to the complaint(s)/dispute(s) in accordance with the relevant redress provisions under Schedule 6 of that Act.
I have considered the submissions of both parties. It is public knowledge that the Respondent’s business has seriously suffered during the financial crisis. The Respondent’s staff have taken pay freezes, closure of the pension scheme and loss of other benefits. To ensure the survival of the IPB scheme it also had to be reduced the same as other benefits. In these circumstances, the Respondent had no option but to cut in line with other benefits.
I do not find the claim well founded and it fails.
Dated: 8th December 2016