Complainant

Respondent

Parties

Derek Steele

TBF Thompson (Garvagh) Ltd t/a TBF Construction Machinery

Representatives

  Self-represented

 Self-represented

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-00066134-001

20/09/2024

The complainant referred a complaint to the Workplace Relations Commission under the Payment of Wages Act 1991 that his employer had not paid him or had paid him less than he was due. 

The complaints referable to the Payment of Wages Act 1991 were in respect of a €5,000 bonus payment the complainant asserted should have been received on 28 June 2024, and payment for accrued annual leave on cessation of employment.

The complainant gave sworn evidence that each year he was paid a bonus based on the company’s performance.  He was verbally told it was based on sales figures and turnover.  In December 2020, he was paid €2,000 in a bonus.  In June of 2022 and 2023, he was paid €5,000 as a bonus payment.  The June 2022 bonus payment was for company performance in 2021, and the June 2023 payment was for 2022 company performance.   The complainant understood the €2,000 payment in December 2020 to be for 2020 company performance.  

There is no reference to a bonus payment in the contract, but it was verbally agreed after the contract was entered into.  It was agreed that the parts manager and parts assistant would get the same amount of bonus because they were doing the same volume of work.

The respondent paid the complainant the following by way of discretionary bonus payment:-

•  €2,000 in December 2020,
•  €5,000 in May 2022, and
•  €5,000 in June 2023.

The discretionary payments were based on profit, not turnover, and were paid to the complainant as an additional voluntary contribution to the complainant’s pension.

Mr Doherty in sworn evidence described the payments as discretionary, and in the nature of retention or loyalty payments. 

At all material times hereto, the complainant worked for the respondent in Dublin as a parts manager.  The complainant gave notice of resignation from employment on 21 June 2024.  The respondent asked the complainant to finish in the workplace on that date. 

It was accepted by the respondent that the complainant did not receive payment on cessation of employment for 4 days accrued annual leave.

The complainant asserted non-payment of a bonus payment payable to him in June 2024.

I have carefully reviewed and considered the documentation provided to me and given due weight to the evidence of the parties.

Section 5 of the Payment of Wages Act 1991 (the “1991 Act”) prohibits the making of deductions from wages save in certain circumstances.  Section 5(6) provides that where on any occasion an employee is paid less than the total amount of wages that is properly payable to the employee on that occasion, the amount of the deficiency or non-payment is to be treated as a deduction. 

In the first instance, I must assess the wages properly payable to the complainant.  This means determining whether the complainant was properly entitled to payment of a €5,000 bonus payment in June 2024.

The letter of offer and contract of employment, issued to the complainant on 30 September 2019, make no reference to a bonus payment.  The remuneration package is detailed as a starting salary of €50,000 gross per annum and there is provision for optional pension contributions on successful completion of probation.   The complainant did however receive payments in addition to salary in December 2020, May/June 2022 and June 2023.  The December 2020 payment was in the sum of €2,000, and the 2022 and 2023 payments were in the sum of €5,000.   The parties differed regarding the purpose of these payments and how they were calculated. 

I do not find support for the submissions that the payments were calculated by reference to either profit and/or turnover; the evidence was of payment of the exact same amount in both 2022 and 2023 and there was no information before me as to how the payment was calculated by reference to either profit and/or turnover.  It is unclear to me how a payment calculated in this way for two different trading years was in the same amount. 

An email from the complainant in February 2022 requested that any bonus that may be coming his way be paid directly to his pension as an AVC.  In an email of May 2023, the complainant asked whether there was any sign of a bonus for last year’s efforts.  I consider these communications indicative of a bonus payment being discretionary in nature.  

On balance, I find that the payments made to the complainant in addition to salary were discretionary payments based on loyalty or service.  I am further supported in this regard by the payment of €2,000 in December 2020, the fact that there was no payment in 2021, and on the complainant’s evidence that he understood the June 2022 and June 2023 payments to be based on the respondent’s performance in the previous year.

On the evidence before me, I am not satisfied that an annual bonus payment of €5,000 in addition to salary was properly payable to the complainant in June 2024.  Accordingly, I do not find there to have been a deduction contrary to section 5 of the 1991 Act in respect of a bonus payment.

I find that the complainant was not paid wages properly payable to him on cessation of employment in respect of accrued but untaken annual leave, and that the non-payment of same amounts to an unlawful deduction within the meaning of section 5 of the 1991 Act. 

I therefore find in accordance with section 6 of the 1991 Act that the complaint of a contravention of section 5 is in part well founded, and I direct the respondent pay to the complainant compensation of €951.14 which I consider reasonable in the circumstances.  The compensation is based on the complainant’s gross weekly pay and is in respect of accrued but untaken annual leave of 4 days.  This award of compensation is payable in accordance with section 6(1)(a) of the 1991 Act.

For the reasons set out above, my decision is that this complaint of a contravention of section 5 of the Payment of Wages Act 1991 is in part well founded and I direct the respondent pay to the complainant compensation of €951.14 which I consider reasonable in the circumstances.

Payment of Wages Act - Bonus payment – Accrued annual leave payment – Properly payable