EMPLOYMENT APPEALS TRIBUNAL
CASE NO.
PW785/12
PW786/12
PW787/12
APPEALS OF:
Honeywell Aerospace Ireland Limited - appellant
against the decisions of the Rights Commissioner in the case of:
Jim Treacy - respondent no. 1
Thomas Coady - respondent no. 2
David Wyse - respondent no. 3
under
PAYMENT OF WAGES ACT 1991
I certify that the Tribunal
(Division of Tribunal)
Chairman: Ms D. Donovan B.L.
Members: Mr J. Browne
Ms S. Kelly
heard this appeal at Waterford on 12th January 2015, 31st March 2015 and 11th June 2015
Representation:
Appellant: Ms Kate O’Toole B.L., instructed by
Ms Catherine Hayes, Lewis Silkin LLP, 5 Chancery Lane,
Clifford's Inn, London, Ec4a 1bl, UK.
Respondents: Mr Pat Kavanagh, Technical Engineering & Electrical Union,
83 Lr Yellow Road, Waterford
The decision of the Tribunal was as follows:-
These appeals came by way of the appellant (the employer) appealing against the Decisions of the Rights Commissioner (ref. r-122910-pw-12/MMG, r-122916-pw-12/MMG, r-122913-pw-12/MMG.
Summary of Evidence:
Respondent No. 1
This matter comes before the Tribunal by way of appeal by the appellant (the employer) in respect of decisions of the Rights Commissioner dated 13th November 2012 which held that a service award of €250 was wages and that the complaint under the Payment of Wages Act 1991 in respect of the failure to pay it was well founded.
The appellant is a multinational company with a presence in Dublin and Waterford. The respondent’s evidence was that he commenced employment with the appellant on 1st July 1996. The Tribunal notes that the date of commencement of employment on the complaint form is 21st October 1996.
A service award scheme had been introduced in the company in 1991. This scheme was not set out in the respondent’s letter of contract dated 5th March 1997. Originally vouchers were provided to recipients of an award under the scheme but in order to comply with Revenue requirements the vouchers were replaced with a cash payment. The Employee Handbook dated January 2006 at page 16 sets out the details of the cash scheme (hereinafter “the first scheme”) which are as follows:-
SERVICE AWARDS
The company will reward you for your years of service as follows:-
5 Years: €80, plus one extra annual leave day (i.e. total 168 hours)
10 Years: €160
15 Years: €250, plus one extra annual leave day (i.e. total 176 hours)
20 Years: €320, plus one extra annual leave day (i.e. total 184 hours)
25 Years: €400
The respondent had previously been a recipient of the 5 year and 10 year service awards. The respondent does not recall ever receiving vouchers and his evidence was that it was always cash. In 2011 the respondent would have been entitled to receive a 15 year service award and accepted that it would have been paid to him the previous July, being July 2010.
It is the respondent’s contention that this service award is a contractual entitlement and the cash element of the award is wages for the purpose of the Payment of Wages Act 1991.
It is the appellant’s position firstly, and as a preliminary issue, that the appeal is statute barred and secondly that the payment is a discretionary payment, is non-contractual and was not part of any negotiated agreement with the union.
In February 2010 the appellant notified its employees that in line with their operations in other countries a new scheme was being introduced whereby instead of a cash payment qualifying employees would be given a gift chosen from a catalogue (hereinafter “the second scheme”).
The respondent was unhappy about the replacement of the cash with a gift and did not consent to or accept the second scheme. Negotiations between the respondent’s union representative and the appellant were ongoing until December 2010 and it was the respondent’s position that because he never accepted the second scheme the first scheme remained in place.
As already noted above, the respondent would have completed 15 years’ service in 2011 and in accordance with practice under the first scheme he should have received a cash payment of €250. It was undisputed that the award ceremony, certificate and the cash payment under the first scheme were always paid the July of the previous year and therefore the payment date for the €250 would have been 22nd July 2010.
The respondent’s representative submitted that time started to run not from the date of notification of the second scheme, being 1st February 2010, but rather time started to run on the date the second scheme affected the respondent being the fifteenth anniversary date of his service, being either 1st July 2011 or 21st October 2011. The complaint was lodged with the Rights Commissioner on 21st May 2012 and it was submitted that although outside six months exceptional circumstances (being on-going negotiations by the Union to resolve the matter) prevented the presentation of the complaint within six months and accordingly the Tribunal should extend the time for a further six months.
Counsel for the appellant submitted that the date time commenced running for the purpose of the within payment of wages complaint was the date the respondent would have received the cash payment under the first scheme and this date, which was not disputed, was 22nd July 2010 and accordingly the complaint was not only outside the six month limitation period but was also outside twelve months which meant the Tribunal had no jurisdiction to extend the time. It was also submitted on behalf of the appellant that it was not open to the respondent to bring an appeal for an alleged contravention under the first scheme and use the operative date of the second scheme to measure time for the purposes of section 6(4) of the Act particularly as the benefit under the second scheme was not wages for the purpose of the Payment of Wages Act 1991.
Respondent No. 2
This matter comes before the Tribunal by way of appeal by the appellant (the employer) in respect of a recommendation of the Rights Commissioner dated 13th November 2012 which held that a service award of €250 was wages and that the complaint under the Payment of Wages Act 1991 in respect of the failure to pay it was well founded.
The appellant is a multinational company with a presence in Dublin and Waterford. The respondent commenced employment with the appellant on the 16th September 1996.
A service award scheme had been introduced in the company in 1991. This scheme was not set out in the respondent’s letter of contract dated 5th March 1997. Originally vouchers were provided to recipients of an award under the scheme but in order to comply with Revenue requirements the vouchers were replaced with a cash payment. The Employee Handbook dated January 2006 at page 16 sets out the details of the cash scheme (hereinafter “the first scheme”) which are as follows:-
SERVICE AWARDS
The company will reward you for your years of service as follows:-
5 Years: €80, plus one extra annual leave day (i.e. total 168 hours)
10 Years: €160
15 Years: €250, plus one extra annual leave day (i.e. total 176 hours)
20 Years: €320, plus one extra annual leave day (i.e. total 184 hours)
25 Years: €400
The respondent had previously been a recipient of the 5 year and 10 year service awards. The respondent does not recall ever receiving vouchers and his evidence was that it was always cash. In 2011 the respondent would have been entitled to receive a 15 year service award and accepted that it would have been paid to him the previous July, being July 2010.
It is the respondent’s contention that this service award is a contractual entitlement and the cash element of the award is wages for the purpose of the Payment of Wages Act 1991.
It is the appellant’s position firstly, and as a preliminary issue, that the appeal is statute barred and secondly that the payment is a discretionary payment, is non-contractual and was not part of any negotiated agreement with the union.
In February 2010 the appellant notified its employees that in line with their operations in other countries a new scheme was being introduced whereby instead of a cash payment qualifying employees would be given a gift chosen from a catalogue (hereinafter “the second scheme”).
The respondent was unhappy about the replacement of the cash with a gift and did not consent to or accept the second scheme. Negotiations between the respondent’s union representative and the appellant were ongoing until December 2010 and it was the respondent’s position that because he never accepted the second scheme the first scheme remained in place.
As already noted above, the respondent would have completed 15 years’ service in 2011 and in accordance with practice under the first scheme he should have received a cash payment of €250. It was undisputed that the award ceremony, the certificate and the cash payment under the first scheme were always paid the July of the previous year and therefore the payment date for the €250 would have been 22nd July 2010.
The respondent’s representative submitted that time started to run not from the date of notification of the second scheme, being 1st February 2010, but rather time started to run on the date the second scheme affected the respondent being the fifteenth anniversary date of his service, 16th September 2011. The complaint was lodged with the Rights Commissioner on 21st May 2012 and it was submitted that although outside six months exceptional circumstances (being on-going negotiations by the Union to resolve the matter) prevented the presentation of the complaint within six months and accordingly the Tribunal should extend the time for a further six months.
Counsel for the appellant submitted that the date time commenced running for the purpose of the within payment of wages complaint was the date the respondent would have received the cash payment under the first scheme and this date, which was not disputed, was 22nd July 2010 and accordingly the complaint was not only outside the six month limitation period but was also outside twelve months which meant the Tribunal had no jurisdiction to extend time. It was also submitted on behalf of the appellant that it was not open to the respondent to bring a complaint for an alleged contravention under the first scheme and use the operative date of the second scheme to measure time for the purposes of section 6(4) of the Act particularly as the benefit under the second scheme was not wages for the purpose of the Payment of Wages Act 1991.
Respondent No. 3
This matter comes before the Tribunal by way of appeal by the appellant (the employer) in respect of a recommendation of the Rights Commissioner dated 13th November 2012 which held that a service award of €250 was wages and that the complaint under the Payment of Wages Act 1991 in respect of the failure to pay it was well founded.
The appellant is a multinational company with a presence in Dublin and Waterford. The respondent commenced employment with the appellant on the 17th August 1996.
A service award scheme had been introduced in the company in 1991. This scheme was not set out in the respondent’s letter of contract dated 5th March 1997. Originally vouchers were provided to recipients of an award under the scheme but in order to comply with Revenue requirements the vouchers were replaced with a cash payment. The Employee Handbook dated January 2006 at page 16 sets out the details of the cash scheme (hereinafter “the first scheme”) which are as follows:-
SERVICE AWARDS
The company will reward you for your years of service as follows:-
5 Years: €80, plus one extra annual leave day (i.e. total 168 hours)
10 Years: €160
15 Years: €250, plus one extra annual leave day (i.e. total 176 hours)
20 Years: €320, plus one extra annual leave day (i.e. total 184 hours)
25 Years: €400
The respondent had previously been a recipient of the 5 year and 10 year service awards. The respondent does not recall ever receiving vouchers and his evidence was that it was always cash. In 2011 the respondent would have been entitled to receive a 15 year service award and accepted that it would have been paid to him the previous July, being July 2010.
It is the respondent’s contention that this service award is a contractual entitlement and the cash element of the award is wages for the purpose of the Payment of Wages Act 1991.
It is the appellant’s position firstly, and as a preliminary issue, that the appeal is statute barred and secondly that the payment is a discretionary payment, is non-contractual and was not part of any negotiated agreement with the union.
In February 2010 the appellant notified its employees that in line with their operations in other countries a new scheme was being introduced whereby instead of a cash payment qualifying employees would be given a gift chosen from a catalogue (hereinafter “the second scheme”).
The respondent was unhappy about the replacement of the cash with a gift and did not consent to or accept the second scheme. Negotiations between the respondent’s union representative and the appellant were ongoing until December 2010 and it was the respondent’s position that because he never accepted the second scheme the first scheme remained in place.
As already noted above, the respondent would have completed 15 years’ service in 2011 and in accordance with practice under the first scheme he should have received a cash payment of €250. It was undisputed that the award ceremony, the certificate and the cash payment under the first scheme were always paid the July of the previous year and therefore the payment date for the €250 would have been 22nd July 2010.
The respondent’s representative submitted that time started to run not from the date of notification of the second scheme, being 1st February 2010, but rather time started to run on the date the second scheme affected the respondent being the fifteenth anniversary date of his service, 17th August 2011. The complaint was lodged with the Rights Commissioner on 21st May 2012 and it was submitted that although outside six months exceptional circumstances (being on-going negotiations by the Union to resolve the matter) prevented the presentation of the complaint within six months and accordingly the Tribunal should extend the time for a further six months.
Counsel for the appellant submitted that the date time commenced running for the purpose of the within payment of wages complaint was the date the respondent would have received the cash payment under the first scheme and this date, which was not disputed, was 22nd July 2010 and accordingly the complaint was not only outside the six month limitation period but was also outside twelve months which meant the Tribunal had no jurisdiction to extend time. It was also submitted on behalf of the appellant that it was not open to the respondent to bring a complaint for an alleged contravention under the first scheme and use the operative date of the second scheme to measure time for the purposes of section 6(4) of the Act particularly as the benefit under the second scheme was not wages for the purpose of the Payment of Wages Act 1991.
Determination on the Preliminary Issue:
Having considered the evidence adduced and submissions made regarding the preliminary issue by the appellant and the respondent, the Tribunal finds that the time started running for the purpose of section 6(4) of the Payment of Wages Act 1991 on 22nd July 2010 because that was the date the respondents would have received the cash payment under the first scheme and the failure to pay them this cash payment is the alleged contravention in respect of which they brought their complaints to the Rights Commissioner.
The Tribunal finds that the date of the alleged contravention is 22nd July 2010. The complaints were lodged with the Rights Commissioner on 21st May 2012. The complaints were, therefore, statute barred and the Tribunal has no jurisdiction to extend the time as the complaints were brought outside the twelve months prescribed in Section 6(4) of the Payment of Wages Act, 1991.
Accordingly, the appeals under the Payment of Wages Act, 1991 succeed and the Tribunal sets aside the decisions of the Rights Commissioner dated 13th November 2012.
In the circumstances the Tribunal makes no determination on the substantive issue as to whether or not the service award is a payment for the purposes of the Payment of Wages Act, 1991.
Sealed with the Seal of the
Employment Appeals Tribunal
This ________________________
(Sgd.) ________________________
(CHAIRMAN)