Complainant

Respondent

Parties

Igor Stanic

Pjb Management Ltd

Representatives

Self-represented

Company director

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-00067307-001

11/11/2024

The complainant was employed by the respondent as Hub Manager, based in Cork.

The complainant gave notice of resignation from employment on 15 May 2024. 

The complaint referred to the Commission under the Payment of Wages Act 1991 concerned non-payment of wages and holiday pay on 24 May 2024.

The respondent submitted that the complainant had breached material terms of his contract of employment, including an exclusive service clause, and that deductions in respect of those breaches were provided for in the complainant’s contract of employment.

The complainant submitted that he had not been paid wages for work with the respondent from 13 to 16 May 2024 inclusive, and that he had not been paid accrued annual leave on cessation of employment.  The value attributed to the unpaid wages was €560.00, and to the unpaid accrued annual leave was €1,008.00.

Summary of complainant’s sworn evidence

The complainant’s last day of work with the respondent was 16 May 2024.  He was ordinarily paid weekly in arrears by electronic funds transfer.  He was not paid for work with the respondent from 13 to 16 May inclusive.   The complainant was working for the respondent on those days on a campaign for a client account.  The complainant disputed working for a competitor during this period.

The respondent’s annual leave year ran from January to December.  Annual leave was calculated by reference to 8% of hours worked.  The complainant had not taken any annual leave in the period from 1 January to 16 May 2024 but was not paid for accrued annual leave on cessation of employment.

The complainant commenced working with a competitor of the respondent in the weeks preceding the termination of his employment with the respondent.   The complainant was using the respondent’s property in the period from 13 to 16 May 2024 to recruit and transfer over respondent employees to the competitor company and to travel to Dublin for a training course.  On receipt of the complainant’s resignation email, the respondent became aware of what was going on and the respondent’s director travelled to Cork to address issues and remove the complainant from the office.   

The respondent referred to the exclusive service and discharge of duties clauses in the complainant’s contract of employment.  The complainant was working for a competitor from 13 to 16 May 2024, which constituted numerous breaches of his contract of employment and justified non-payment of wages to the complainant in respect of those dates.

The respondent accepted the complainant had not taken annual leave from January to May 2024.  The respondent did not pay the complainant for accrued annual leave on cessation of employment due to an issue with a vehicle that belonged to the respondent.

The Relevant Law & Findings

Section 1 of the Payment of Wages Act 1991 (the “1991 Act”) defines wages in relation to an employee as meaning:-

“…. 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: Provided however that the following payments shall not be regarded as wages for the purposes of this definition:

(i) any payment in respect of expenses incurred by the employee in carrying out his employment,

(ii) any payment by way of a pension, allowance or gratuity in connection with the death, or the retirement or resignation from his employment, of the employee or as compensation for loss of office,

(iii) any payment referable to the employee's redundancy,

(iv) any payment to the employee otherwise than in his capacity as an employee,

(v) any payment in kind or benefit in kind,

(vi) any payment by way of tips and gratuities.”

Section 5 of the 1991 Act prohibits the making of deductions from wages save in certain circumstances. 

Section 5(6) of the 1991 Act provides as follows:-

“Where-

(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 complaint before me is in respect of non-payment of wages in the sum of €560.00 for 13 to 16 May 2024 inclusive, and non-payment of accrued annual leave on cessation of employment in the sum of €1,008.00.

It was common case that the complainant’s gross weekly wage at the material time was €700.00, and that the complainant had 7.2 days accrued annual leave as of 16 May 2024, the monetary value of which was €1,008.00.

The respondent relied on the contract of employment, alleged breaches of the contract and its submission that the complainant had not worked for the respondent in the week beginning 13 May 2024 to justify the non-payment of wages/deductions. 

I have carefully reviewed the contract of employment, submitted by the respondent after the hearing.

The exclusive service and discharge of duties clauses in the contract of employment placed obligations on the complainant during the continuance of his employment and in discharge of his duties.  The contract of employment also provided for summary termination on certain grounds, including where an employee is guilty of any material breach or non-observance of the contract provision, grave misconduct or serious act of dishonestly. 

In adjudicating on this complaint under the 1991 Act, I am not adjudicating on the grounds put forward by the respondent to justify the termination of the complainant’s employment with immediate effect on 16 May 2024. 

My adjudication is concerned with assessing the wages properly payable to the complainant on 24 May 2024.

Section 5(1) of the 1991 Act prohibits an employer from making a deduction from the wages of an employee unless-

(a)    the deduction is required or authorised to be made by virtue of any statue or any instrument made under statute,

(b)   the deduction 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

(c)    the employee has given their prior consent in writing to the deduction. 

On the evidence before me, I find that the complainant’s employment with the respondent was terminated by the respondent with immediate effect on 16 May 2024.

I am satisfied that there was no term of the contract of employment between the parties that required or authorised the deductions made by the respondent from the complainant’s wages in the circumstances contended for by the respondent. 

Furthermore section 5(2) of the 1991 Act precludes an employer from making deductions from wages in respect of any act or omission on the part of an employee unless certain conditions are satisfied.  The conditions include provision to the employee, at least one week before the making of the deduction, with particulars in writing of the act or omission and the amount of the deduction.  There was no evidence before me of the relevant conditions having been complied with by the respondent.

A clause in the contract headed “Deductions of Salary” provided: -

“In the event that there has been any overpayment to the Employee of any type or if at any stage, he lawfully owes the Company money then the Company is hereby expressly empowered to deduct such sums directly from any salary and/or amounts properly due to the Employee.  It is hereby expressly agreed that such deductions shall be expressly authorised and will not contravene the provisions of the Payment of Wages Act, 1991.”

The respondent has not established to my satisfaction that the complainant lawfully owed the respondent money by reason of a breach of a material term of the contract of employment, which breach was disputed by the complainant, or otherwise. 

I find that the complainant was entitled to payment of wages for 13 to 16 May 2024 inclusive, and to payment of accrued annual leave on cessation of employment.  The respondent’s non-payment of the previously mentioned wages constitutes a contravention of section 5 of the 1991 Act.

I therefore decide that this complaint is well founded and direct, in accordance with section 6 of the 1991 Act, the respondent to pay to the complainant compensation of €1,568.00 which I consider reasonable in the circumstances.

My decision is that the complaint is well founded, and I direct the respondent pay compensation to the complainant in the amount of €1,568.00.

Payment of Wages Act 1991 – Deductions – Contract of employment – Properly payable