SECTION 7(1), PAYMENT OF WAGES ACT, 1991
A RETAIL COMPANY
(REPRESENTED BY MS. MAIREAD MCKENNA B.L.)
- AND -
(REPRESENTED BY MR. LARS ASMUSSEN B.L.)
1.An appeal of an Adjudication Officer's Decision No(s)ADJ-00005949 CA-00008230-002
The Complainant is a Personnel Manager in one of the Respondent’s stores and is a longstanding employee. This case is an appeal of an Adjudication Officer’s decision in a case taken by the Complainant alleging an unlawful deduction from the Complainant’s wages by the Respondent contrary to s.5 of the Payment of Wages Act 1991, ‘the Act’. The claim to the Workplace Relations Commission was lodged on 17 November 2016. Therefore, the cognisable period for the claim, as per s.41 of the Workplace Relations Act 2015, is the six months preceding that date.
The Adjudication Officer found that the amounts concerned had not been unlawfully deducted.
At the time of the circumstances of this case, the Complainant was working in the Respondent’s store in ‘X’ location. In 2014 the Respondent undertook a re-organisation, as a result of which it identified a need for less roles for Personnel Managers.
Various options were offered to existing Personnel Managers including, for a limited period, the option of voluntary severance. The Complainant was not interested in voluntary severance on the terms offered.
A dispute then arose between the parties regarding the terms of the Complainant’s contract, in particular as to whether the Complainant could be required to support the store ‘Y’, in addition to the store ‘X’.
The Complainant initiated the company’s Grievance Procedure but, after some initial activity, this was not progressed as the Complainant went on extended sick leave from March 2015. The certificates submitted to the Respondent referred to ‘stress/stress at work’.
There followed some considerable correspondence regarding the dispute between the parties.
The Complainant was medically certified as fit to return to work after 8 August 2016. The Respondent refused to allow the Complainant to return to work citing non co-operation with its back to work protocols and as she continued to refuse to support store ‘Y’ and, as a result, she continued not to be paid.
On 17 November 2016, the Complainant lodged a claim with the Workplace Relations Commission, ‘WRC’, under the Act stating that her employer had unlawfully deducted wages that were properly payable to her, contrary to the terms of the Act. The case was heard by an Adjudication Officer,
When the AO found that the claim was not well founded, the Complainant appealed to the Court.
The parties to the case informed the Court that they were in agreement that the Court could deal with the case on the basis of written arguments submitted to the Court. When invited to do so, neither party chose to comment on the other party’s submission at the hearing.
The Complainant had wages properly payable to her unlawfully deducted by her employer, contrary to s. 5 of the Act.
InMaria Cronin v. Eircom Limited (2007)18 ELR 84, Laffoy J. held that an employment contract contains an implied term that an employer will provide appropriate work to an employee. She went further to say that ‘A contractual term of mutual trust and confidence should be implied into each contract of employment in this jurisdiction by operation of law’. In that case damages were awarded for breach of contract because the employer had failed to provide work to the Plaintiff for an extended period.
In the instant case, the Complainant, on a number of occasions, advised the Respondent that she was fit, able and ready for work. Despite the legal obligation on the Respondent, they failed to provide her with work and failed, refused or neglected to pay her for those periods when she was fit and available. This amounts to an unlawful deduction in the Complainant’s wages. None of the authorised deductions provided for in s.5 of the Act are applicable to the circumstances of this case.
The Complainant asserts that she was entitled to be paid her wages, having proclaimed herself to be medically fit to return to work on 8 August 2016. Alternatively, she appears to be claiming that she was placed on administrative leave and was entitled to her contractual pay.
The Complainant did not have a contractual entitlement to pay during her period of absence as she had exhausted her contractual entitlements to paid leave prior to 8 August 2016.
The Complainant’s absence did not end until she returned to performing her obligations under her contract of employment. Until this time, the Complainant had no contractual entitlement to any wages as she was not fulfilling her contractual duties.
The Complainant chose not to return to work and to comply with what she was reasonably required to do.
The Complainant is aware that once she complied with the Respondent’s return to work protocols and undertook to perform her contractual duties she would be welcomed back to work and, once she did so, she was returned expeditiously to her work.
The claim under the Act is fundamentally misconceived and manifestly unstateable.
The Applicable Law
Payment of Wages Act 1991
“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:
5.— (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.
Workplace Relations Act 2015
(6) Subject tosubsection (8), an adjudication officer shall not entertain a complaint referred to him or her under this section if it has been presented to the Director General after the expiration of the period of 6 months beginning on the date of the contravention to which the complaint relates.
Deliberation and Determination
Both parties argue in this case that the other party failed to abide by the Complainant’s contract.
The Complainant argues that when she was certified as fit to return to work, she was prevented from doing so because of on-going arguments regarding her contractual obligations, which, she says, do not require her to take on responsibilities in respect of store ’Y’.
The Respondent in the course of their submission state at one point in respect of the attempts by the Complainant to return to work in August 2016 that ‘The sole requirement for her to return to work was that she comply with the Respondent’s return to work protocols as required by the sickness policy which makes up part of her contract’. In this regard, it is noted that the Complainant refused to meet a manager in a coffee shop on 10 August 2016, deeming the location to be inappropriate. However, it is clear from the submission made to the Court that the Respondent was unwilling to allow the Complainant to return to work until she was willing to comply with what the Respondent believes to be the terms of her contractual obligations in respect of taking on responsibilities in store ‘Y’ and that this was the main requirement before the Respondent was willing to facilitate a return to work.
As this Court noted inFinancial Services Union v. Gerry Hanna PWD202, ‘Where a deduction is made in an employee’s salary it is incumbent on the employer making the deduction to identify the statutory or contractual provision under which that deduction is authorised’.
In the instant case, the observations of White J. inJohn Lawe v. Irish Country (Pig Meats) Ltd (1998) 9 ELR 266,are relevant when he noted that ‘An employer’s fundamental obligation is to pay the agreed remuneration for the times of work during which the employee is prepared to work’. This is consistent with the judgement in theEircomcase referred to in the arguments for the Complainant.
Therefore, an employer is not entitled to rely on a failure to facilitate an employee in returning to work as a basis on its own for refusing to pay their wages. They must rely on either a statutory or contractual basis for doing so. In the instant case, the question for the Court is whether the Respondent was entitled, as per s.5 1(b) of the Act, to rely on the Complainant’s contract in refusing to permit her to return to work.
There are some elements of the Complainant’s contract that require examination in this regard. The Complainant contends that the mobility clause in her contract required her agreement before she could be required to work in another store. The relevant provision reads;
‘As part of your on-going development you may be required to move to another store. This would be achieved by agreement’.
The provision which refers to the Complainant being ‘required’ to move to another store is at variance with the provision that this would happen ‘by agreement’. The Court is of the view that, as it is clear that there is a contractual requirement for agreement, the Respondent cannot compel such a move, in the absence of such agreement. The Court did not have the benefit of argument as to whether or when any such agreement might be considered to have been unreasonably with-held, so it must rely solely on the terms of the contract, as written. In that regard, the Court is clear that the Respondent is not entitled to rely on this provision in the contract as a basis for refusing to meet its fundamental obligation to pay the ‘agreed remuneration for the times of work during which the employee is prepared to work’ as noted by White J.
The Act does not permit an employer to use a refusal to pay wages that are properly payable within the meaning of the Act as leverage in a contractual dispute, unless the worker is acting contrary to the terms of their contract or there is a statutory basis for doing so.
The Respondent is correct to point out that its return to work protocol forms part of the Complainant’s contract and they are entitled to draw attention to the fact that this protocol requires a back to work meeting with a manager, which never took place due to the Complainant’s refusal to meet in a coffee shop. However, in a letter to the Complainant on 11 August 2016, the day after the aborted meeting, Mr. T. for the Respondent wrote that ‘whereas we are delighted if your doctor is indeed advising that you are fully fit to return to work, there still remains the outstanding question as to whether or not you are prepared to return to work in accordance with what is required of the role…’ He goes on to say ‘we do urgently require confirmation by you….if you are now willing to return to work in accordance with what is required of the role’ and finally he adds ‘In the event that we do not receive the confirmation required by Friday 12thAugust……..the Company will have to carry out a review of your position..’
In light of this correspondence, it is somewhat surprising that a representative of the Respondent wrote to the Complainant’s representative on 12 August 2016 regarding the requirement for a back to work meeting stating ‘This is a standard back to work meeting that is scheduled with all absentees and to suggest that the company is in some way forcing your client to resign her position is absurd’.
In the ordinary course, if an employee returning to work expressed concern about the location of a back to work meeting, the parties would reach an easily agreed alternative. While the Complainant is required to abide by the Respondent’s back to work protocols, it is not unreasonable for her to seek a mutually acceptable location for any meeting. The correspondence from Mr. T makes clear, in any event, that such a meeting would not have resolved the question of the Complainant’s return to work as the Respondent continued to prevent such a return until the Complainant waived her contractual right to refuse to agree to take on responsibilities in respect of store ‘Y’. It is clear that this was the outstanding matter to be resolved to the satisfaction of the Respondent before the Complainant was to be permitted to return to work. Indeed, the Respondent stated that a required response on this matter was urgent and that failure to respond in order to confirm her agreement to changes in her contract would trigger a review of the Complainant’s continued employment.
Throughout the correspondence between the parties, the Respondent refers constantly to the fact that the full time role in store ‘X’ no longer exists and there is a clear hint of exasperation at the Complainant’s refusal to take on responsibilities in store ‘Y’. However, until such time as a contract is terminated, its terms subsist and either party is entitled to rely on it. Indeed, as Costello J. noted inIndustrial Yarns v. Greene (1984) ILRM 15, even in the unique circumstances of lay-off where there is a ‘cesser of employment…the contract still subsists’. In the instant case, the Respondent was entitled to seek the agreement of the Complainant to vary the terms of her contract. However, in the absence of her agreement to do so, they were obliged to honour that contract for as long as it subsisted.
In all the circumstances, the Court concludes that the Complainant’s wages were properly payable for the period in which she was medically fit to return to work in the cognisable period up to the date on which she lodged her complaint on 17 November 2016. While the Complainant states that she was fit for work from 8 August 2016, there is confusion as to the certification for that date. Furthermore, under the Respondent’s back to work protocols the aborted meeting was scheduled for 10 August 2016, which would suggest that, even if all had gone well, the earliest realistic date of return would have been on 15 August 2016.
The Complainant’s weekly wage was €951.73 gross. The wages properly payable to her for the period 15 August to 17 November 2016, which were deducted unlawfully, contrary to s.5 of the Act, total €12,943 gross and, in accordance with this Determination, should now be paid to the Complainant.
The Decision of the Adjudication Officer is overturned.
Enquiries concerning this Determination should be addressed to David Campbell, Court Secretary.