EMPLOYMENT EQUALITY ACT, 1977
EQUALITY OFFICER'S RECOMMENDATION NO. EE 08/1996
P A R T I E S
Ms. A. Kirwan
(Represented by Spring, Murray & Co)
AND
PWA International Limited.
(Represented by I.B.E.C.)
1 Dispute
1.1 This dispute concerns a claim by Ms. Kirwan that she was
discriminated against by P.W.A. International Limited
when it offered her a promotion in October 1993 and did
not offer her a salary increase as it did to two males
who were promoted at the same time.
2 Background
2.1 The Company repairs jet engine cases and was established
in 1989. The claimant started work with the Company in
January 1990 as a Financial Accountant. In May 1993 she
was promoted to Assistant Manager of Financial
Operations and in addition took on the role of
Management Accountant. In October 1993 the Company
offered promotion to four members of staff, to the
Management posts of Engineering, Quality, Production and
Finance, the latter being offered to the claimant. The
Managers of Engineering and Quality were given
File No. EE 12/1994
increases. The newly appointed Manager of Production did
not get an increase but had got one earlier in the year
(January 1993) during a pay freeze. The claimant who
had taken on the extra responsibility of Management
Accountant in May was not offered an increase in either
May or October. She sought a 5% increase and indicated
to management that she was prepared to accept the
position and negotiate the increase separately. The
Company withdrew the offer of promotion when she did not
accept a 3% "goodwill" increase it offered her.
2.2 The claimant referred the dispute to the Labour Court on
the 7 April, 1994 under Section 2(a) and (d) of the
Employment Equality Act, 1977. The Labour Court
referred this claim to the Equality Service on the 13th
April, 1994.
2.3 The claimant submitted a further claim under Section
2(d) of the Act to the Labour Court on 28th September,
1994 and this dispute was referred to an Equality
Officer on the 6th October, 1994. This latter claim has
been dealt with under Recommendation No EE 09/1996.
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3 Summary of the Claimant's case
3.1 The claimant says that she joined PWAI as a Financial
Accountant in January 1990 and subsequently reported to
the Financial Controller. A Management Accountant (Mr
McClave) was appointed in June 1991. In 1993 the
Financial Controller, a U.S. expatriate on secondment,
returned to the U.S. The claimant and Mr McClave
applied for the ensuing vacancy and following two
interviews Mr. McClave was promoted to Financial
Controller and the claimant was appointed to the post of
Assistant Manager of Financial Operations with
responsibilities of both Financial and Management
Accountant under this new title in May 1993.
3.2 The claimant says that in October 1993 a new layer of
management was introduced by the Company and four
positions as Managers of Engineering, Production,
Quality and Finance were offered to current members of
staff. The claimant was offered the position of Manager
of Finance but was told there would be no increase in
salary with this job. The three other promotees were
males.
3.3 The claimant argues that the Managers of Engineering and
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Quality were awarded increases of 7.5% and 8%
respectively in line with the new managerial positions
and the new Manager of Production had been promoted from
Senior Production Engineer to Production Superintendent
in January 1993 and was awarded an increase of 8%, even
though there was a pay freeze at that time in the
Company.
3.4 The claimant claims that this was the second time in the
space of five months that she was denied a salary
increase following a promotion.
3.5 The claimant indicated to the Financial Controller that
promotion to Manager of Finance was not acceptable
unless she was given an increase in line with those on
offer to the male managers and indicated that 5% would
be an acceptable figure, both in relation to the
increases on offer to the other managers and in relation
to market salary levels. The claimant also argues that
she was refused an increase by the Company because her
salary was in line with outside relativities while the
Manager Quality Assurance was given an increase in
advance of his market rate because it considered that
the market survey did not match his value to the
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Company.
3.6 The claimant says that the four managerial positions are
comparable in terms of status and seniority and on this
basis sought an increase when the promotion was offered
to her. The Company offered her an increase of 3% as a
"gesture of goodwill" but this was not acceptable to her
and she indicated to the Financial Controller that she
considered that this was discrimination on the basis of
her sex and told him that she intended seeking third
party advice in relation to the Employment Equality Act.
The Employment Equality Agency subsequently wrote to the
Company on her behalf in November. She argues that
subsequent to raising the possibility of making a claim
that she was treated unfavourably by the Company.
3.7 The claimant argues that she was treated less favourably
because of her sex because PWA International is a male
dominated organisation. In support of this she points
out that there are 93 employees, 13 of these are female.
Of the 10 lowest paid people in the organisation 7 of
these are female. She holds the most senior female
position in PWAI. She is the only female to have been
promoted to management level. She argues that PWAI are
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not in a position to demonstrate how favourably or
otherwise they have treated other female members of
staff in terms of promotion, either married or single.
3.8 The claimant maintains that the main reasons for
believing she was treated less favourably because of her
sex are;-
1. Discrimination against her by the Company when Mr.
McClave was promoted to the position of Financial
Controller, but accepts that this complaint is out
of time in relation to the 1977 Act.
2. She claims she was treated less favourably than Mr.
McClave, when on returning to work after maternity
leave in September 1992, in her comparative role as
accountant, she was excluded from certain functions
e.g. budget planning, and consequently did not have
the same company profile when the post of financial
controller was being filled.
3. The Company discriminates against other females in
the organisation with regard to pay.
4. She claims that in every incident of promotion or
increased responsibility for male members of staff,
a pay increase has been awarded (4 incidents in
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particular)
5. She claims that the Company has a policy of paying
higher starting salaries to male members of staff
compared with female members engaged in like work
or of similar professional qualification. She says
that a female engineer was paid less on recruitment
than a male recruited at the same time although
both had similiar experience and qualifications.
6. She claims that her current salary reflects only
two general pay increases since January 1991 but
says that the Company insist she is earning enough.
She claims that it is the Company's intention to
hold her salary virtually static until the other
male managers have caught up with her.
3.9 The claimant argues that she was penalised because;
1. She was denied the position of Manager of Finance
subsequent to informing Mr. McClave that she
intended to seek third party advice.
2. She was deliberately excluded from meetings,
memoranda circulations and information which
directly impacted upon her work scope and position.
Prior to October 1993 it would have been normal
practice for her to be in attendance. (At least 6
8
incidents).
3. Mr. McClave as Financial Controller and as one of
the two senior managers is in an influential
position to exercise his control and autonomy. He
has publicly undermined her authority to run the
finance department on at least 3 occasions.
4. She claims that in November 1993 each of the other
three managers were requested to document their
1994 work objectives. A meeting was held in April
1994 between the three managers, Mr. McClave and
the General Manager to discuss these objectives.
She also operates in a supervisory capacity to
three members of staff and the Company's revised
organisational chart in November 1993 (see Appendix
1) recognises her on par with the other three male
Managers in terms of seniority. She was not
included in these discussions and she considers
that she should have been.
5. She claims that a meeting was held in December 1993
by the previous General Manager Mr. Konrad
explained that the "new organisational structure"
was intended to see the Company through the next
couple of years. She considers she has been
penalised in terms of her progress and development
9
in PWAI and her opportunity for future promotion
has been adversely affected by being denied the
position of Manager of Finance.
6. She claims that Mr McClave's unacceptable behaviour
towards her and his deliberate attempts to exclude
her from the mainstream of management activity has
lead to her making two official complaints about
him to the General Manager. The latter agreed to
investigate this to promote a return to proper
communications and professionalism.
4 Summary of the Company's arguments
4.1 The Company says that PWA International was established
in 1989 and is a joint venture between Pratt & Whitney,
the U.S. jet-engine manufacturer, and Airmotive Ireland.
The Company repairs jet engine cases in its facility
near Rathcoole, Co. Dublin. This is a high technology
operation involving advanced processes in welding,
machining and metal finishing, providing a high quality
competitive service to the aviation industry world wide.
4.2 The Company argues that the claims made by the claimant
in this case that she was discriminated against on the
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grounds of her sex under the terms of the Employment
Equality Act, 1977, when she did not receive a salary
increase when offered the position of Manager (Finance),
is not relevant to the Employment Equality Act, 1977.
Furthermore, the Company says in relation to the
claimant's allegation that she has been penalised for
referring this case under the 1977 Act, that without
prejudice to its first argument, it rejects the
allegation that it discriminated against the claimant on
the grounds of her sex in not offering her a salary
increase when offering her the position of Manager
(Finance), and argues that it did not penalise the
claimant in any way as a result of her pursuing this
claim.
4.3 The Company also argues that the claim is not relevant
to the Employment Equality Act and in support of this
quotes Section 3(1) of the Act which states that:
"a person who is an employer or who obtains under a
contract with another person the services of employees
of that other person shall not discriminate against an
employee or a prospective employee or an employee of
that other person in relation to access to employment,
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conditions of employment [other than remuneration
(Company emphasis) or any condition relating to an
occupational pension scheme], training or experience for
or in relation to employment, promotion or regrading in
employment or classification of posts in employment"
It claims that remuneration is specifically excluded
from the 1977 Act, and that because the claimant is
seeking a pay increase which is remuneration it
therefore renders this claim invalid under the terms of
the 1977 Act. It says that remuneration is defined in
the Anti-Discrimination (Pay) Act, 1974 as including:
"any consideration, whether in cash or in kind, which an
employee receives, directly or indirectly, in respect of
his employment from his employer".
4.4 The Company argues that the definition of "consideration
" is crucial to determining what is included in the term
"remuneration". This issue was addressed in two
previous cases by Equality Officers. The two cases
concerned were (1) Male Employees v Educational Building
Society(EP 9/87) and (2) 127 Catering Assistants v
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British Home Stores (Dublin) Ltd (EP 01/1988). In both
of these cases the issue of consideration was looked at
in detail. The Equality Officers involved in the two
cases accepted that:
"consideration may be described as some advantage
moving from one party to a contract to the other party
to the contract in return for something given or
promised to the other party under the contract."
4.5 The Company argues that if the above definition is
applied to this case, then the pay increase is an
advantage given by one party (i.e. the Company) to the
other party in return for agreeing to take up a middle
management position in the Company, under the terms
offered. As a result, claiming discrimination because
one was not given a pay increase involves consideration
(and thus remuneration), and is therefore specifically
excluded from the terms of the Employment Equality Act,
1977.
4.6 The Company argues that by referring to pay in her
submission that the claimant has accepted that this
dispute is one of pay.
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4.7 The Company rejects both claims or allegations made by
the claimant under the 1977 Employment Equality Act. It
rejects:
1 the allegation that she was treated less favourably
than the three comparators when offered a Middle
Management position in the Company and that this
was less favourable treatment because of her sex
and
2 the allegation made by the claimant that she was
penalised for taking action in pursuance of her
entitlement under the 1977 Act.
In relation to the allegation by the claimant that she
was discriminated against when offered a middle
management position and not offered a salary increase at
the time, the Company argues that one of the comparators
mentioned by the claimant, Mr. Furlong, was not offered
a salary increase at this point in time either. The
Company argues in Mr. Furlong's case, who had been given
a salary increase in January 1993, that this increase
had no link whatsoever with the offer of promotion to a
middle management position made to him in October 1993,
as the whole concept of introducing a new middle
management tier to the organisation had not even been
conceived in January 1993.
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4.8 The Company argues that in October 1993 Ms. Kirwan and
Mr. Furlong found themselves in very similar
circumstances i.e. both offered middle management
positions within the Company with no increase in
responsibilities and no increase in salary but merely a
change in title i.e both male and female were being
treated identically.
The Company says that Mr. Furlong accepted the position
as offered. It says that Ms. Kirwan, although being
paid 13% higher than Mr. Furlong, rejected the terms and
conditions of the position on offer and thereby created
a dilemma for the Company making her appointment
impossible. It says that Ms. Kirwan demanded a 5%
increase in her salary and that it, the Company,
recognising Ms. Kirwan's discontent made her an offer of
3% as a gesture of goodwill and in an effort to seek
compromise. This offer was rejected. The Company, at
this point, felt that it had done enough and to go any
further would be to discriminate against every other
person in the organisation in favour of Ms. Kirwan.
4.9 The Company claims that Ms. Kirwan was not offered a
salary increase because of where her salary stood in
15
relation to market rates for the proposed position. The
Company had made reference to two reputable market
surveys to assist in determining the going market rates
for the job under consideration;
1 Report on executive salaries and fringe benefits in
Ireland 1992 (IMBUCON)
and
2 Careers Register salaries survey 1991/92 .
The Company claims that these were the most up to date
available at that time contrary to the claimant's
allegations.
4.10 The Company says that the IMBUCON survey suggests that
the claimant should earn between £20,675 and £22,929 per
annum. The Careers Registers survey suggests that her
earnings should be between £26,000 and £28,400 per
annum. The Company says that it opted to use the
Careers Registers survey for comparison and that as the
claimant was earning £29,364 it considered that a salary
increase was inappropriate. The Company argues that the
claimant was then and is still the highest paid of the
four people proposed to assume middle management
positions. The Company's decision not to offer her an
increase in salary had nothing to do with her sex. It
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claims that if a male had been in the same position as
the claimant then he would have been treated no
differently.
4.11 The Company says that to determine where the salaries of
the newly appointed managers stood in relation to market
rates for their proposed positions, the Company also
referred to the IMBUCON survey. It determined that Mr.
Geoghegan (Manager Engineering) and Mr. Furlong (Manager
Production) were paid below the market rates. The
Company says that the IMBUCON survey did not adequately
represent the importance and responsibilities of a
Manager Quality Assurance (Mr.Murphy) in the aviation
industry. The Company therefore decided to increase Mr.
Murphy's salary to the same level as the lowest salary
proposed for the three other middle management
positions.
4.12 The Company makes reference to the fact that the
claimant said she was discriminated against on the
grounds of her sex on being refused a salary increase
when she assumed additional responsibilities as
Assistant Manager Financial Operations. The Company
claims this is the first time this allegation has been
17
made against the Company. It was never part of the
claim referred by the claimant on the claim form sent to
the Labour Court. On the form, the claimant only makes
reference to the alleged discrimination act occurring on
the 15th October, 1993. The Company argues that there
are numerous examples within the Company of males who,
even when they have taken on significantly greater
responsibilities and/or new job titles, have not
received pay increase. This was because the Company
regarded them as being adequately compensated for their
skills and responsibilities. It pointed out that on a
particular occasion when the Company had employed two
welding supervisors and one left, it made an additional
payment to the remaining supervisor to ensure that he
would continue in the service of the Company.
4.13 The Company also gave an example of where a male,
although his duties were changed, got no increase in
pay. This was Mr. Hensey who was employed as a Manager
of Technical Sales reporting to the then Commercial
Manager. When the latter left the company Mr. Hensey
then reported directly to the General Manager and his
title was changed to International Sales Manager. This
change involved taking on the responsibility for sales
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within Europe which was a significant increase in
responsibility, and the new job involved a considerable
amount of time travelling abroad, where previously he
would have remained in the Company and the Commercial
Manager did all of the travelling.
4.14 The Company says that these examples show clearly that
the Company does not automatically increase a person's
pay when there is a change in their job title or
increase in responsibilities. The Company argue that
males have failed to get pay increases when they have
taken up new job titles within the organisation and/or
when they have taken on increased responsibilities. It
argues that there is no basis to the claim being made by
the claimant that it was because she was a female that
she got no pay increase when she was offered the
position of a middle manager in the Company.
4.15 The Company also addressed the allegation made by the
claimant that she had been penalised for having made a
claim under the 1977 Act. The Company denies all of the
allegations made by her in her submission. The Company
says that the claimant was not excluded from the
position of Manager of Finance by the Company but that
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she did not accept the terms and conditions attaching to
the position and therefore, denied the position to
herself. It says that the position of Manager of
Finance was not denied to her subsequent to her telling
the Company that she intended seeking third party
advice.
4.16 The Company maintains that she was not excluded from any
meetings or memoranda circulations and information as a
result of her claim. The Company argues that the
Financial Controller has the right to talk directly to
and request information from all the employees in the
Finance Department without having to refer to the
Assistant Manager Financial Operations prior to doing so
and consequently, he has in no way undermined her
authority due to this discrimination claim.
4.17 The Company further emphasises that the claimant has
never been excluded from anything that she has an
entitlement to attend. In reference to the point she
made concerning a meeting in April 1994, the Company
argues that the reason she was excluded from this
meeting was because only new managers were in attendance
at this meeting and as she was not one of this group,
20
she had no entitlement to attend. Other people within
the organisation with subordinates did not attend this
meeting either.
4.18 With reference to an organisation chart referred to by
the claimant (Appendix 1), the Company says that it is
incorrect to imply that it recognises the claimant as
being on a par with the three middle managers. It
argues that this chart was prepared by the Technical
Department and does not accurately reflect the levels of
people within the organisation as it was not prepared by
the Human Resources Department. Not all the people
listed in a vertical axis would be regarded as being at
the same level in the Company. The Company points out
that in one such chart it shows senior management
positions and a middle management position on the same
vertical axis. The Company does not view these
positions on the same level. Furthermore, the claimant
is named as Assistant Manager in the organisation
charts, compared with Mr. Murphy, Mr. Furlong and Mr.
Geoghegan who are listed as Managers. Notwithstanding
the above, the Company acknowledges that placing Ms.
Kirwan on the same vertical axis as the three middle
managers was misleading.
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4.19 The Company argues that the claimant was offered the
position but refused to accept the terms and conditions
attaching to it. The claimant has not been penalised in
terms of her progress and development in the Company and
in the opportunities for future promotion because of her
sex or because she has pursued an equality claim. The
Company claims that the official complaints the claimant
made about the Financial Controller to the General
Manager were in fact about the Financial Controller's
behaviour towards her staff and secondly, concerning a
meeting which the Financial Controller asked her to
attend in his office when she arrived accompanied by one
of her staff saying she would not talk to the Financial
Controller henceforth without a third party being
present. The Company argues that this working
arrangement was impossible to sustain and the Financial
Controller asked her to leave his office. Subsequent to
this, the General Manager was notified by the Financial
Controller of this issue and he in turn told her that
there should be one to one contact between herself and
the Financial Controller concerning work issues. Thus,
the Company claims, what happened in this incident had
nothing whatsoever to do with the fact that Ms. Kirwan
22
had made a claim under the Employment Equality Act
against the Company.
4.20 The Company says it is incorrect for the claimant to say
that she occupies the most senior female position in
PWAI as there are no female or male positions in PWAI.
It also says that it is incorrect for the claimant to
say that she is the only female to have been promoted in
the Company. It says that one woman who commenced
employment with the Company as a secretary/receptionist
has since been promoted to Documentation Controller, to
Quality Assurance Assistant and then to her current
position of Quality Administrator. In another case a
woman, who was appointed Inventory Controller in January
1991, had her salary moved from £10,000 to £14,500 in 15
months, due to a change in reporting structures.
4.21 The Company pointed out that the claimant's references
to discrimination, i.e. Mr. McClave's promotion to
Financial Controller, her less favourable treatment in
comparison to Mr. McClave on return to work after
maternity leave and also that the Company has
discriminated against other females in the organisation
with relation to pay, are allegations that were not
23
raised prior to this case with the Company and were
never part of the claim referred by the claimant on the
claim form to the Labour Court. It also argues that
notwithstanding that, these issues have no basis in
fact. The Company further refutes the claimant's
allegation that where male members of staff were given
promotion or increased responsibility a pay increase has
always being awarded. It has given examples of males who
have taken on increased responsibility and have not
received a corresponding pay increase. The Company also
denies that it has a policy of paying higher starting
salaries to male members of staff compared with female
members engaged in like work or of similar professional
qualifications.
4.22 The Company also rejects the claimant's allegation that
it is the Company's intention to hold her salary
virtually static until other male managers have caught
up with her. It claims that this allegation is
incorrect. It claims that Ms. Kirwan has been for quite
some time the highest paid non senior manager in the
Company.
4.23 The Company claims that it has always actively avoided
24
discrimination of any kind in relation to its employees
or prospective employees. It points out that it employs
two physically handicapped people and it also employed a
female who was the only female to apply, as an
engineering operative on the shop floor. The Company
rejects the allegation by the claimant that she was
discriminated against because of her sex/or marital
status. It argues that the claimant, in referring this
case is really looking for a pay increase which should
properly be referred under the Anti-Discrimination (Pay)
Act 1974. The Company also says that without prejudice
to that argument, it rejects the allegation that it
treated the claimant less favourably because of her sex
and/or marital status. The Company also rejects the
allegation that the claimant was penalised for taking
action in pursuance of an entitlement under the
Employment Equality Act 1977.
5 Equality Officer's Conclusions
5.1 In investigating this case concerning the offer of
promotion to the claimant, I have taken into account the
total evidence made available to me i.e. the oral
submissions made in the course of a hearing attended by
25
both parties and the written submissions made by them,
both before and after the hearing.
5.2 The claimant has alleged that she was discriminated
against by the Company when it did not award her a pay
increase in October 1993 in conjunction with the offer
of appointing her to the post of Manager of Finance.
She claims that males in the Company have always been
awarded increases when they have been promoted. She has
also alleged that the Company operates a discriminatory
policy against female staff members.
5.3 The Company argues that the dispute relates to
remuneration and as such is specifically excluded from
the 1977 Act.
5.4 I note that the claimant served the claim because she
was not offered an increase in pay when she was offered
a promotion in October 1993 as were two of three men
also offered promotion at that time. She sought an
increase of 5% and was offered 3% by the Company. I
consider that the dispute between the parties in October
1993 was the amount of an increase due to the claimant
on foot of the Company's offer to her of the post of
26
Manager Finance. This increase, if agreed, would form
part of the claimant's total remuneration.
This claim has been served by the claimant under the
Employment Equality Act 1977. The Employment Equality
Act 1977 excludes disputes relating to remuneration;
Section 3(1) of the Act states:
"A person who is an employer or who obtains under a
contract with another person the services of employees
of that other person shall not discriminate against an
employee or a prospective employee or an employee of
that other person in relation to access to employment,
conditions of employment (other than remuneration or any
condition relating to an occupational pension scheme),
training or experience for or in relation to employment,
promotion or re-grading in employment or classification
of posts in employment."
I find therefore that the claim is not appropriate for
consideration under the 1977 Act.
5.5 I have also taken into consideration the claimant's
contention at the hearing that she is seeking equal
treatment with the male employees promoted in October
1993 and consequently that she should have been awarded
27
a pay increase as they were. Four people were offered
promotion, one woman and three men. I note however that
the Company offered increases to two of the four
appointees. The claimant and one of the males were not
offered an increase at this time. I note that he had an
increase awarded to him in January 1993 (some 10 months
previously) when he was promoted from supervisor to a
production Superintendent. However the Company treated
both her and one of the male appointees in a similiar
fashion in October 1993 and consequently I consider that
it did not discriminate against the claimant in relation
to this appointment.
6 RECOMMENDATION
6.1 In view of my conclusions in the previous paragraph that
the dispute relates to remuneration, I find that the
claim is excluded from the provisions of the 1977 Act.
--------------------
Mary Solan Avison
Equality Officer
11th April, 1996.
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