The Equality Tribunal
EMPLOYMENT EQUALITY ACTS 1998 - 2008
DECISION NO. DEC-E2011-165
PARTIES
Denis Coonan
(Represented by Cian O'Carroll Solicitors)
AND
Stada Production Ireland Limited
(Represented by IBEC)
File reference: EE/2008/478
Date of issue: 7 September 2011
Headnotes: Employment Equality Acts, 1998-2004 - sections 6 and 19 - equal pay - age - like work
1. DISPUTE
This dispute involves a claim by Mr Denis Coonan that he performs "like work", in terms of section 7 of the Employment Equality Acts with six named comparators and is therefore entitled to access to the same redundancy package in accordance with section 19(1) of the Acts. The respondent rejects the complainant's assertion that he performs "like work" with the named comparators and notwithstanding this argument it submits that there are grounds unconnected with age which render the rates of remuneration paid to the complainant and comparators lawful in terms of section 19(5) of the Acts. The complainant also made claims in relation to discriminatory treatment in relation to promotion/re-grading, conditions of employment and a collective agreement but these were withdrawn.
2. BACKGROUND
2.1 The complainant submits that he performs "like work" in terms of sections 7(1) of the Employment Equality Acts with six named male comparators and he is therefore entitled to access to the same redundancy package. He referred a complaint under the Employment Equality Acts to the Equality Tribunal on 15 July 2008. On 3 June 2010 in accordance with his powers under the Acts the Director delegated the complaint to the undersigned, Hugh Lonsdale, Equality Officer, for investigation and decision and for the exercise of other relevant functions under Part VII of the Acts, on which date my investigation commenced. A Preliminary Hearing took place on 29 September 2010. As like work was disputed by the respondent work inspections took place on 9 February 2011, a substantive hearing of the claim took place on 9 March 2011 and final information was received on 3 June 2011.
3. SUMMARY OF THE COMPLAINANT'S CASE
3.1 The complainant started working for the respondent (a pharmaceutical company) in 1970 as a sugar coater. He was hired because of his specialist knowledge and started up the sugar coating area in the respondent. He submits that he was placed in a supervisory role over the other staff in the coating area. He did not have significant personnel duties but he did attend the weekly supervisors' meeting, he was authorised to countersign the same documents as other supervisors, he was required to check and approve paperwork and sign off on the correctness of work, also he was issued with a supervisor's uniform.
3.2 The complainant submits that the respondent unveiled a restructuring plan in December 2006 in which all the supervisors were offered a redundancy package; apart from himself, another supervisor in the coating area and one other. They were told they were "red circled". When he asked he was told that he was not eligible because his skills were essential. The complainant submits that this did not make sense because at this time he was spending most of his time doing bulk packaging and only sugar coating when another supervisor was unavailable.
3.3 The complainant submits that the respondent's refusal to allow him access to the redundancy package was a cost saving measure for them as he was due to retire in two years. The six comparators were all supervisors who availed of the redundancy package.
3.4 The complainant submits that when he was refused access to the redundancy package he applied for early retirement because he was suffering from arthritis in his hands. He was refused early retirement but was told that if he changed his job to a General Operative then management would make him redundant after a few months. After three months he asked to be made redundant and was told that due to financial constraints the respondent could not afford to make him redundant. He was advised to go on medical certificates and he did this from November 2008 until he retired in February 2009.
3.5 The complainant submits that he undertook work of a similar nature with the comparators, in accordance with section 7(1)(b) of the Acts and is therefore entitled to equal remuneration in accordance with section 29 of the Acts. The complainant further submits that redundancy payments are a form of pay and he should therefore have been entitled to have access to the same redundancy package as the comparators. The complainant submits that he was refused access to the redundancy package because it would have been expensive for the respondent to make him redundant as he had thirty seven years service. It was cheaper for them let him retire naturally two years after the announcement of the redundancy package. He submits that this refusal amounts to discrimination in relation to equal pay on the grounds of age.
4. SUMMARY OF THE RESPONDENT'S CASE
4.1 The respondent confirmed that the complainant started work for them on 1 July 1970 and worked as a Coater not a Supervisor for thirty seven years.
4.2 In December 2006 the respondent proposed a restructuring plan that included a voluntary redundancy package for employees in particular roles throughout the plant. The plan was agreed with the union and the roles to be made redundant included 10 production supervisors, as well as three warehouse staff, eight QA/QC staff and one person in shipping.
4.3 The ten production supervisors all worked under the same job description which had been signed off by the supervisors in November 2004. They were a key link between the department manager and the shop floor operatives. They were responsible for communicating production plans to all operators and over-seeing the implementation of these plans. All ten supervisors were made redundant and their jobs were taken up by Shift Managers. The ten supervisors took either voluntary redundancy, or were redeployed as operators or appointed as Shift Managers.
4.4 The respondent submits that the complainant's job does not come under the job description for supervisor. He worked in a specialist role as a coater and did not carry out supervisory duties. Because of his specialist role the complainant was at a higher rate of pay (€14.10) than the supervisors (€13.01), at the time the Restructuring Plan was proposed (December 2006). The restructuring plan had no proposals for change to the coating area, therefore no staff in the area had access to the voluntary redundancy package.
4.5 The respondent submits that the complainant and the colleague in the coating area referred to by the complainant in his submission raised an objection to being excluded from the redundancy package. In response the respondent set out the reasons they had been excluded but in an attempt to resolve the perceived sense of grievance they were offered €2,000, a similar payment to the supervisors who were redeployed, provided "it is accepted that they are not eligible for redundancy as per the terms of the restructuring agreement". This was accepted immediately by the colleague and sometime later by the complainant. The respondent made this payment on the understanding that the complainant's grievance regarding the redundancy package was settled.
4.6 The respondent submits that in early 2007 the complainant requested help in relation to a retirement pension as he had not contributed to a pension scheme. In order to assist it was suggested that if he took up a role of Facilities Caretaker as there was a possibility that such a role would no longer be required in two years time. The complainant moved into the role and maintained his Coater level of pay. After three months the complainant asked to be made redundant and the respondent submits that it was not in a position to make the role redundant after such a short period.
4.7 The respondent submits that the complainant was not a production supervisor as he claims. He did not carry out work of equal value with the six comparators. He was a Coater, which was a specialist job and he was paid €1.09 per hour more than the production supervisors. Furthermore his role continued after the restructuring, whereas the production supervisor roles no longer existed. Therefore he was not eligible for redundancy and no discrimination took place.
5. FINDINGS AND CONCLUSIONS OF THE EQUALITY OFFICER
5.1 The complainant received an hourly rate that was €1.09 per hour more than the comparators However, he makes the claim that redundancy payments are a part of remuneration for the purposes of section 29 of the Acts and his exclusion from a redundancy package was discriminatory in relation to equal pay. Section 2 of the Acts defines remuneration "in relation to an employee, does not include pension rights but, subject to that, includes any consideration, whether in cash or in kind, which the employer receives, directly or indirectly, from the employer in respect of the employment". The Labour Court in Determination No. FTD066, considered this issue. Whilst it was an appeal under the Protection of Employees (Fixed -Term Work) Act, 2003 I consider it relevant to this case as their definition of remuneration is: "a) any consideration, whether in cash or in kind, which the employee receives, directly or indirectly, from the employer in respect of the employment, and
(b) any amounts the employee will be entitled to receive on foot of any pension scheme or arrangement." The Labour court stated: "The question of whether redundancy payments come within the definition of pay was directly considered by the Court in Case C 262/88 Barber v Guardian Royal Exchange Assurance [1990] ECR 1-1889. The Court said the following-
12 As the Court has held, the concept of pay, within the meaning of the second paragraph of Article 119, comprises any other consideration, whether in cash or in kind, whether immediate or future, provided that the worker receives it, albeit indirectly, in respect of his employment from his employer ( see, in particular, the judgment of 9 February 1982 in Case 12/81 Garland v British Rail Engineering (( 1982 )) ECR 359, paragraph 5 ). Accordingly, the fact that certain benefits are paid after the termination of the employment relationship does not prevent them from being in the nature of pay, within the meaning of Article 119 of the Treaty
13 As regards, in particular, the compensation granted to a worker in connection with his redundancy, it must be stated that such compensation constitutes a form of pay to which the worker is entitled in respect of his employment, which is paid to him upon termination of the employment relationship, which makes it possible to facilitate his adjustment to the new circumstances resulting from the loss of his employment and which provides him with a source of income during the period in which he is seeking new employment .
14 It follows that compensation granted to a worker in connection with his redundancy falls in principle within the concept of pay for the purposes of Article 119 of the Treaty.
In this case the severance payments were paid because the recipients were employees of the Respondent who were losing their jobs. There was thus an unseverable causal connection between the employment and the payments. It follows that the payments were in respect of the employment. It is clear from the decision in Garland that the ex-gratia nature of the payments is irrelevant to their classification as remuneration. Accordingly the Court is satisfied that the payments at issue are remuneration and come within the purview of Section 6 of the Act."
I therefore conclude that redundancy payments falls within the definition of remuneration and this claim can be considered as a claim for equal remuneration in accordance within the terms of section 29 of the Acts.
5.1 The issue for decision by me is whether or not the complainant performs "like work" with the six named comparators in terms of section 7(1)b) of the Acts, in that "the work performed by one is of a similar nature to that performed by the other and any differences between the work performed or the conditions under which it is performed by each either are of small importance in relation to the work as a whole or occur with such irregularity as not to be significant to the work as a whole" or if in accordance with section 29(5) of the Acts that "nothing in this Part shall prevent an employer from paying, on grounds other discriminatory grounds, different rates of remuneration to different employees". In reaching my conclusion I have taken into account all of the submissions both written and oral made to me by both parties.
5.2 The respondent has argued that contends that the redundancy package was only offered to those members of staff whose jobs were being made redundant as part of their restructuring plan. Ten posts of Production Supervisors were done away with and their duties re-allocated. That is accepted by both parties. What is in dispute is whether the complainant was in this category. In order to clarify this dispute and to ascertain if the complainant undertook work of a similar nature to the comparators I undertook work inspections.
5.4 None of the named comparators were still working for the respondent, as they had taken the redundancy package. Also the post of production supervisor was no longer in place. However, I undertook a work inspection with the help of one of the production supervisors who stayed working for the respondent. He showed me his duties immediately before the restructuring plan was put into effect. I also had the benefit of the job description that had been agreed in November 2004 which I accept as reflecting the duties of the named comparators at the time immediately before the restructuring did away with their jobs. This job description is attached at Appendix 1. The Production Supervisor's main responsibility was to be a key link between the department manager and the shop floor operatives. They were also responsible for communicating production plans to all operators and over-seeing the implementation of these plans. The work inspections confirmed they signed-in products, ensured the products went through the correct manufacturing process and then signed them out and oversaw the clean-up for the area before the next batch of production was started. Most of the production process was undertaken by operatives whose work was overseen by the comparators. When circumstances allowed or necessitated the supervisors assisted in the production process.
5.5 The complainant also signed-in and signed-out batches of products that were sugar coated but this could also be carried out by the colleague who was also not offered the redundancy package. His main responsibility was to make up the sugar coating formulation and then carry out the sugar coating. This is a process that was considered to be highly skilled and the complainant and his colleague were the only people with the skills to undertake this work. The level of skill was the reason he received a higher rate of pay than the production supervisors. No separate job description was available from the respondent for the complainant so I have drafted a job description from the work inspections, see Appendix 2.
5.6 My conclusion from the work inspections and from all the information provided by both sides is that there are distinct differences between the role of the complainant and the named comparators. The complainant spent most of his time undertaking the specialist role of sugar coater and his pay reflected this. All the named comparators undertook similar roles to each other in different areas of the plant which involved the supervision of staff and their work, in which the complainant had minimal involvement. Accordingly, I find that the complainant did not undertake the duties of a production supervisor.
5.7 The respondent contended that there were reasons other than age for the difference in pay, in this case by offering the redundancy package to the comparators but not to the complainant. They argued that the production supervisors were a group whose role the respondent decided to do away with in their restructuring plan whilst the complainant's role was unaffected by the restructuring plan. There were two others working at a similar level who were also not offered the redundancy package. The first person was the colleague of the complainant who also worked in the sugar coating area and was not offered the redundancy package for the same reason. The other person worked in the maintenance area which was also not affected by the restructuring plan. I accept the arguments of the respondent and find that the respondent had good reason, unconnected with the age of the complainant, not to offer the complainant access to the redundancy package and this lawful in accordance with section 29(5) of the Acts
6. DECISION OF THE EQUALITY OFFICER.
I have concluded my investigation of this complaint and hereby make the following decision in accordance with Section 79(6) of the Employment Equality Acts.
I find that there are grounds other than age for the difference in pay between the complainant and the named comparators in accordance with section 29(5) of the Acts. Accordingly, I find that the respondent did not discriminate against the complainant on the age ground contrary to section 29(1) of the Employment Equality Acts in relation to his remuneration.
_____________________
Hugh Lonsdale
Equality Officer
7 September 2011
APPENDIX 1
JOB DESCRIPTION
PRODUCTION SUPERVISOR
The supervisors provide a key link between the department manager and the shop floor operators. They are responsible for communicating production plans to all operators and over-seeing the implementation of these plans. The specific duties of supervisors are listed below:
Assign duties to all Grade 1 operators, Grade 2 operators, chargehands and line leaders. Ensure that the work centres in use are staffed with appropriately trained personnel.
Allocate time for the training of plant personnel on GMP, Health & Safety and new versions of SOP's. Move operators to work centres for training purposes.
Liaise with the department manager on a regular basis so that all issues relevant to plant performance are communicated effectively.
Check sign raw materials in the dispensary.
Release rooms after partial cleandowns/changeovers
Review batch documentation.
Carry out duties of the line leader when necessary.
Liaise with QC personnel so that they are kept informed of the timings of cleandowns and changeovers.
Liaise with Maintenance personnel so equipment breakdowns are communicated rapidly and unplanned downtime minimised.
Attend daily Production briefing meetings.
Ensure that batch documentation (PCR's) is completed correctly and passed between work centres (where applicable)
Assist in the efficient operation of stock takes
Notify the department manager of any operator training requirements
Record work centre performance data
These tasks are not intended to represent a comprehensive and exhaustive list of all supervisor duties. However, they outline the principal responsibilities and serve as a guide as to where attention should be directed each day. The manager should always be consulted regarding any difficulties in carrying out supervisor responsibilities.
APPENDIX 2
JOB DESCRIPTION
SUGAR COATER
The sugar coater is responsible for:
Ensure that batch documentation (PCR's) is completed correctly and passed between work centres (where applicable)
Make up the sugar coating formulation
Carry out all stages of the sugar coating process
Check sign work for other coaters
Undertake cleandown between batches and release rooms. Liaise with QC personnel when needed.
Undertake training in sugar coating as required
Liaise with Maintenance personnel so equipment breakdowns are communicated rapidly and unplanned downtime minimised.
Attend daily Production briefing meetings.
Assist in the efficient operation of stock takes
Notify the department manager of any operator training requirements
Liaise with the department manager on a regular basis so that all issues relevant to plant performance are communicated effectively.
These tasks are not intended to represent a comprehensive and exhaustive list of all Sugar Coater duties. However, they outline the principal responsibilities and serve as a guide as to where attention should be directed each day.