FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : BORD GAIS EIREANN (REPRESENTED BY ARTHUR COX) - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION DIVISION : Chairman: Mr Hayes Employer Member: Ms Cryan Worker Member: Mr Nash |
1. Compensation for loss of earnings
BACKGROUND:
2. The worker has been employed by the Company as a gas fitter (a band 9 position) for 28 years. His pay for that period has been made up of basic salary, stand-by payment, overtime payment and productivity payment. In June, 2009, the Company advertised the position of Training Co-ordinator and the worker applied for the post which is band 5. He was successful and was offered a contract in August, 2009. The dispute arises from the fact that if the worker accepts the position his basic salary would increase but his gross earnings would be substantially reduced as he would lose various additional payments that he received as a gas fitter i.e stand-by, overtime and productivity. The Union's case is that the worker should be left on a personal salary which would include the stand-by payment or else be compensated for his loss which, the Union claims, has happened in similar circumstances in the past. The Company's case is that the worker was aware of the salary/situation involved when he applied for the post.
The dispute was referred to the Labour Relations Commission (LRC) and a conciliation conference took place. As the parties did not reach agreement, the dispute was referred to the Labour Court on the 26th August, 2010, in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 13th January, 2010.
UNION'S ARGUMENTS:
3. 1. The formula being sought by the Union,which is set out in R2000 Agreement, has been applied several times by the Company over the last 10 years. It is used to facilitate greater flexibility in the movement of staff across categories.
2. As recently as 2009 one of the worker's colleagues was successful in being appointed to the Gas Control Department and the formula was applied to him.However, in this case the Company refuses to compensate the worker concerned.
COMPANY'S ARGUMENTS:
4. 1. The Company clearly set out the minimum and maximum points in the band when it advertised the post so all applicants were fully aware of the potential earnings involved. The Company agreed to place the worker at the top of the band 5 scale, taking into account his previous overtime earnings, which is the maximum that he could earn in that position.
2. The worker's colleague referred to by the Union who was compensated was part of a specific agreement finalised by the parties in October, 2007. The agreement was made where the Company sought to impose particularly onerous changes on the position of Gas Controller. The agreement only lasted to October, 2008, and so did not apply to the worker concerned.
RECOMMENDATION:
The Court has carefully considered the written and oral submissions of both parties in this case.
Normally the Court takes the view that any person who responds to an advertised vacancy on a company notice board implicitly commits to accepting the job, if successful at interview, on the terms and conditions set out in the advertisement. This is particularly the case where the rates of pay and conditions of employment of the post have been established by way of a collective agreement.
A company is entitled to withdraw an offer of employment that it has made to a successful candidate if that person seeks to impose conditions on his acceptance of the job offer that are more onerous on the company than those set out in the advertisement.
Compensation for loss of earnings may arises where the company seeks to implement changes that have the effect of reducing the structured historical earnings level of employees affected by the change.
This is the principle set out by the Company in this case and the Court would normally support that position.
However, the Company has not been consistent in the manner in which it has applied this principle in the past. It has departed from it on a number of occasions for various reasons and particularly in relation to its application to the grade of gas fitter.
This inconsistency, in the Court’s view, gave rise to a legitimate expectation on the part of the claimant that he could accept the job on the terms offered and in addition be entitled to compensation for “loss of earnings” associated with his previous position in accordance with the formula set out in the R2000 Agreement.
In order to bring this matter to a conclusion and establish the principle that will apply in the future, the Court recommends that the Company apply the loss of earnings formula set out in the R2000 Agreement in this case. In addition, the Court recommends that the Union accept that this is an exceptional case and that, in the absence of a specific agreement to the contrary, no such legitimate expectation will arise in the future and the principle set out above will apply to all future job advertisements.
The court so recommends.
Signed on behalf of the Labour Court
Brendan Hayes
21st January, 2011______________________
CONDeputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Ciaran O'Neill, Court Secretary.