ADJUDICATION OFFICER DECISION
Adjudication Reference: ADJ-00014033
Parties:
| Complainant | Respondent |
Anonymised Parties | A Software Developer | A Financial and Business Solutions Provider |
Representatives | The Complainant attended in person | Ibec |
Complaint:
Act | Complaint Reference No. | Date of Receipt |
Complaint seeking adjudication by the Workplace Relations Commission under section 6 of the Payment of Wages Act, 1991 | CA-00018449-001 | 11/04/2018 |
Date of Adjudication Hearing: 08/08/2018
Workplace Relations Commission Adjudication Officer: Enda Murphy
Procedure:
In accordance with Section 41 of the Workplace Relations Act, 2015 following the referral of the complaint to me by the Director General, I inquired into the complaint and gave the parties an opportunity to be heard by me and to present to me any evidence relevant to the complaint.
Background:
The Complainant was employed by the Respondent as a Software Developer from 16 July, 2013 until 23 February, 2018 when she resigned her employment. The Complainant’s annual gross salary on her termination date was €53,060.40. The Complainant claims that the Respondent made an unlawful deduction from her wages contrary to Section 5 of the Payment of Wages Act 1991 on the termination of her employment. The Respondent strongly disputes the claim and contends that no unlawful deductions were made from the Complainant’s wages on the termination of her employment. |
Summary of Complainant’s Case:
The Complainant claims that the Respondent made an unlawful deduction from her wages contrary to Section 5 of the Payment of Wages Act 1991 on the termination of her employment. The Complainant resigned from his position as a Software Engineer with effect from 23 February, 2018. The Complainant claims that she worked 17 days during the month of February, 2018 prior to her termination of employment. The Complainant didn’t take any holidays in 2018 so she had accrued an entitlement of 3.5 days annual leave for 2018 and also had an untaken entitlement of 2 days annual leave accrued from 2017. The Complainant submits that she was paid her usual monthly salary of €4,421.70 for January, 2018. However, the Complainant claims that her pay was calculated incorrectly for February, 2018 and that she was only paid €4,183.60 whereas she should have been paid her normal monthly salary of €4,421.70. The Complainant claims that the method by which the Respondent calculated her pay for February was incorrect and resulted in an unlawful deduction in the amount of €340.10 being taken from her final pay on the termination of her employment. |
Summary of Respondent’s Case:
The Respondent submits that the Complainant resigned her position in writing on 23 January, 2018 and stated in her resignation e-mail that she was happy to work until 23 February, 2018. On 23 February, 2018, the Complainant e-mailed the Respondent’s HR Department and indicated that she had 4 days annual leave carried over from 2017 that was not paid as part of her final pay. The Respondent’s HR Department replied to the Complainant on 23 February, 2018 confirming that she had 2 days accrued annual leave carried over from 2017 that she would be compensated for which would be paid to her in March, 2018. On 26 February, 2018, the Respondent’s Payroll Manager met with the Complainant to talk through the payroll leaver process. During the meeting it was explained to the Complainant that “leavers payroll is calculated based on the working days in the year and – in the Respondent company - the working days per year is set at 260”. During that meeting the Complainant requested to change her leave date with the Respondent. However, the Respondent was not in a position to change or alter the leave date due to the fact that the Complainant’s resignation had been tendered on 23 January, 2018, the Respondent accepted the resignation date and it was agreed in January, 2018 that the leave date would be 23 February, 2018. The Complainant expressed her dissatisfaction to the Respondent that her leave date could not be changed and there was a subsequent exchange of e-mails between the parties on this matter. The Respondent reiterated its position to the Complainant that it was not possible for her to change or alter her leave date at that juncture. On 21 March, 2018, the Complainant e-mailed the Respondent’s HR Business Partner, outlining that in her opinion the issue was not closed and that she was owed €340 by the company. The Complainant asked “what manageable option” the company could offer and that she was “sure – the company – can be a partner in sorting this out”. On 22 March, 2018, the Respondent’s Business Partner replied to the Complainant and indicated that the calculation method, when calculating her final pay, was consistent with the way all employees who leave are processed and as such no exception could be made in her case. There was a further subsequent exchange of e-mails between the parties to try and resolve this matter but to no avail. The Respondent submits that the wages “properly payable” to the Complainant within the meaning of Section 5(6) of the Act were the wages she received in her final pay and as noted on her final payslip on 23 February, 2018 and the two additional accrued, but unused annual leave days carried over from 2017 that were paid on 30 March, 2018. These payments are outlined below: January 2018 · Salary paid on the last Friday of every month i.e. Friday 26 January. · The Complainant received a gross payment of €4,421.70 (Annual Salary €53,060.40 / 12 = €4,421.70). · Payment was made by way of bank transfer on the 26 January but included payment up to 31 January, 2018. February 2018 · Salary paid on last Friday of every month i.e. Friday 23 February. · The Complainant worked from 1 to 23 February, 2018. This was a total of 17 days. · The Complainant received a gross salary payment of €3,469.33 (Annual Salary €53,060.40 / 260 * 17 days = €3,469.33. · The Complainant had 3.5 accrued but unused annual leave days. These were paid as part of her final pay on 23 February (Annual Salary €53,060.40 / 260 * 3.5 days = €714.27). · In total the Complainant received a gross payment of €4,183.60 on 23 February, 2018 for days worked and accrued but unused annual leave in 2018. March 2018 · The Respondent was made aware that the Complainant had 2 accrued but unused annual leave days carried over from 2017. · These were paid top the Complainant on 30 March, 2018 (Annual Salary €53,060.40 / 260 * 2 days = €408.16). · Total final payment to the Complainant was €4,591.76. This was inclusive of the 17 days worked by the Complainant from the 1 to 23 February, 2017, 3.5 days accrued and unused annual leave in 2018 and 2 days accrued and unused annual leave in 2018. The Respondent submits that the Complainant’s wages were paid in accordance with its internal policy and procedure and the terms of her employment. There is precedent within the organisation for the utilisation of the above mechanism/formula as the normal method of establishing wages owing and properly payable to employees upon cessation of employment. The Respondent submits that the total amount paid to the Complainant in this case is the total amount of wages that were properly payable to her and thus no deduction as defined by the Act occurred. |
Findings and Conclusions:
The Law Section 1 of the Payment of Wages Act provides for the following definition of “wages”: “wages”, in relation to an employee, means any sums payable to the employee by the employer in connection with his employment, including— (a) any fee, bonus or commission, or any holiday, sick or maternity pay, or any other emolument, referable to his employment, whether payable under his contract of employment or otherwise, and (b) any sum payable to the employee upon the termination by the employer of his contract of employment without his having given to the employee the appropriate prior notice of the termination, being a sum paid in lieu of the giving of such notice.” Section 5(1) of the Act provides: “(1) An employer shall not make a deduction from the wages of an employee (or receive any payment from an employee) unless— (a) the deduction (or payment) is required or authorised to be made by virtue of any statute or any instrument made under statute, (b) the deduction (or payment) is required or authorised to be made by virtue of a term of the employee’s contract of employment included in the contract before, and in force at the time of, the deduction or payment, or (c) in the case of a deduction, the employee has given his prior consent in writing to it.” Section 5(6) of the Act provides:— (a) the total amount of any wages that are paid on any occasion by an employer to an employee is less than the total amount of wages that is properly payable by him to the employee on that occasion (after making any deductions therefrom that fall to be made and are in accordance with this Act), or (b) none of the wages that are properly payable to an employee by an employer on any occasion (after making any such deductions as aforesaid) are paid to the employee, then, except in so far as the deficiency or non-payment is attributable to an error of computation, the amount of the deficiency or non-payment shall be treated as a deduction made by the employer from the wages of the employee on the occasion. The issue for decision is whether the Respondent made an unlawful deduction from the Complainant’s wages contrary to Section 5 of the Payment of Wages Act 1991 on the cessation of her employment. The Complainant claims that the method by which the Respondent calculated her pay for the month of February, 2018 was incorrect and resulted in an unlawful deduction in the amount of €340.10 being taken from her final pay on the termination of her employment. The Respondent disputes the claim and contends that the Complainant’s pay for February, 2018 was calculated in accordance with its established policy for the calculation of leavers pay on the cessation of her employment. In considering this issue, I note that the Respondent submitted documentary evidence (including payslips) in relation to the wages paid to the Complainant upon the cessation of her employment. I have carefully considered this documentation and the method by which the Complainant’s pay for the month of February, 2018 was calculated and I am satisfied that her pay was calculated correctly for this period and that she received the wages which were properly payable to her in accordance with the terms of her contract of employment. Having regard to the foregoing, I find that the Respondent did not make an unlawful deduction from the Complainant’s wages contrary to Section 5 of the Act. |
Decision:
Section 41 of the Workplace Relations Act 2015 requires that I make a decision in relation to the complaint in accordance with the relevant redress provisions under Schedule 6 of that Act.
I find that the Respondent did not make unlawful deductions from the Complainant’s wages contrary to Section 5 of the Payment of Wages Act 1991. Accordingly, I find the Complainant’s claim under the Payment of Wages Act 1991 is not well founded. |
Dated: 25/10/18
Workplace Relations Commission Adjudication Officer: Enda Murphy
Key Words:
Payment of Wages Act 1991 – Section 5 - Unpaid wages – Claim not well founded |