DEC-E2015-150

EMPLOYMENT EQUALITY ACTS

DECISION NO. DEC-E2015-150

PARTIES

Catherine Hanrahan

(Represented by Mandate)

-V-

Shaw & Sons Ltd t/a Shaws Department Stores

(Represented by Peninsula Business Services)

File reference: EE/2013/015

Date of issue: December 2015

HEADNOTES: Employment Equality Acts Sections 6 and 8; Conditions of Employment – Family Status-Gender – Discrimination

1 DISPUTE

1.1 This dispute concerns a claim by Ms Hanrahan that she was discriminated against by the company on the grounds of gender and family status in that her employer decided not to pay part of a two additional week’s pay bonus she claims was due to receive in December 2012 under the terms of a collective agreement. This resulted from her absence on maternity leave in the course of the preceding year which she claims is contrary to the terms of 6 (2) (a) and (c) of the Employment Equality Acts and of Section 8 in that these payments formed part of her conditions of employment.

1.2 The complainant referred her claim to the Director of the Equality Tribunal on 22nd January 2013 under the Employment Equality Acts. On 17th August 2015, in accordance with his powers under section 75 of the Acts, the Director delegated the case to me, Pat Brady, an Equality Officer, for investigation, hearing and decision and for the exercise of other relevant functions of the Director under Part VII of the Acts, on which date my investigation commenced. Submissions were received from both sides and in accordance with Section 79(1) of the Acts and as part of my investigation I proceeded to a hearing on September 1st 2015.

1.3 This decision is issued by me following the establishment of the Workplace Relations Commission on 1 October 2015, as an Adjudication Officer who was an Equality Officer prior to 1 October 2015, in accordance with section 83 (3) of the Workplace Relations Act 2015.

2 COMPLAINANTS' SUBMISSION

2.1 The complainant has worked on a full time basis as a Supervisor for the respondent since 10th November 2000.

2.2 In 2004 the company concluded a collective agreement with the union to facilitate Sunday opening (henceforward ‘The 2004 Agreement’). It contained the following provision (at Paragraph 5);

The company will pay two additional weeks basic pay at Christmas in recognition of ongoing cooperation with Sunday and Public Holiday working commencing Christmas 2004.

2.3 The union says that there was no reference in the agreement to this being dependent on the employee being present in the workplace for any specific qualifying period, and there were no other compliance requirements such as attendance, performance, or company profitability as may arise in other bonus schemes and that it should be construed on the basis of what it said.

2.4 The claimant was absent on maternity leave in 2012 and when her bonus was paid it was reduced to one week because of her absence on maternity leave. Following maternity leave in 2009 she had been paid the full bonus and the claimant was the first person to have the bonus reduced due to absence on annual leave.

2.5 On raising the matter with the company it appeared that there were a variety of systems in operation in its different stores but the union says this was not the case in Waterford that a number of named employees who had availed of maternity leave were paid the full bonus.

2.6 It says that the company’s actions are in breach of the Acts on the basis that it falls under the conditions of employment provisions of the Acts and is discriminatory in that a deduction on this basis can never be made from a male employee’s bonus.

3 RESPONDENT'S SUBMISSION

3.1 The company stressed in its submission that she was ‘an exemplary employee’.

3.2 The respondent agrees that there was inconsistency in the application of the 2004 Agreement across its five stores and in 2010 it sought to standardise the position by introducing a pro rata reduction where more than six weeks in cumulative absences during the year were recorded, regardless of the reason for the absences. Having regard to the economic circumstances of the time it regarded these changes as reasonable and equitable and these were applied in the Waterford store in 2010.

3.3 It claimed that four other named employees who had been on maternity leave had their bonuses reduced as a result of their absence.

3.4 It also named other male employees who had reductions applied to the bonus and said that determining remuneration based on attendance at work cannot be regarded as other than objectively justified employees.

3.5 It also said that Paragraph five of the 2004 agreement created a requirement that an employee be in the workplace in order to demonstrate the on-going cooperation referred to and that maternity leave accounts for only 14% of absences.

3.6 Reference was made to case law and various legislation to support the case that a pro rata reduction of a bonus to reflect absence on ordinary leave was not discriminatory, and which dealt with various other aspects of issues arising during or following periods of maternity leave. These were the subject of full discussion at the hearing and I consider them below.

4 FINDINGS & CONCLUSIONS OF THE EQUALITY OFFICER

4.1 I have to decide if the complainant was subjected to discriminatory treatment on the grounds of family status and gender. In reaching my decision I have taken into account all of the submissions, oral and written, made to me in the course of my investigation as well as the evidence presented at the hearing.

4.2 The parties were agreed that the net point was whether the scheme of bonuses in the 2004 agreement required any qualifying criteria, and even if it did not, (following disputed revisions to the scheme in 2010) whether the inclusion of maternity leave in those varied arrangements in 2010 constituted a breach of the Acts as alleged by the complainant.

4.3 On the first aspect of this the union submitted that on the ordinary reading of he agreement it did not, and that had it done so it would not have been accepted by its membership in the company. Indeed it referred to additional inducement in the form of a payment to the employees’ social fund which was made at the time to encourage the acceptance of the deal. On this point I accept the complainant’s submission.

4.4 The subsequent variation of the agreement was effected without union agreement and while this may raise issues of an industrial relations nature the only issue for decision in this case is whether the inclusion of periods of time spent on maternity leave is discriminatory.

4.5 A number of authorities were opened by the respondent. It submitted the judgement of Bean J. in Hoyland v Asda (EATS/0058/04) was authority for the proposition that it was not discriminatory or a pregnancy related detriment to reduce a bonus pro rata to reflect an absence on maternity leave. However, in that case there was a stipulation that the bonus was dependent on the company’s sales performance. Other cases referred to in that judgement were not on point as the issues were variously the payment of wages during the absence on maternity leave or had a clear qualifying period for the bonus. (CNAVTS v Thibault [1998] IRLR 399)

4.6 An exception to this was the English case of GUS Home Shopping v Green and McLaughlin [2001] IRLR 75 which the court in Hoyland regarded as not being relevant to that case it is relevant to the complainant’s claim in this case.

4.7 In GUS v Green etc a discretionary loyalty bonus was introduced to recognise employee cooperation with a move of office location in April 1998. Payment was ‘contingent on an orderly and effective transfer of the marketing department…cooperation and goodwill of the individual employee, and the employee remaining in post until March 31st 1998. The plaintiffs were absent on maternity leave and one received no payment and the other a reduced payment. Their claim that the withholding or reduction of the bonus was a result of pregnancy and was an act of ‘sex discrimination’ was upheld by the Employment Tribunal and on appeal by the Employment Appeals Tribunal.

4.8 While the respondent pointed out that there are some distinctions between GUS and the current case (the bonus was discretionary), for example the UK EAT accepted the analysis (quoted in Hoyland) that

‘’It (the bonus) required no more than the contract of employment to continue and it required the employee to do no more than comply with the contract of employment, namely to cooperate and show good will’.

In other words there were no other ‘satisfying requirements.’ To that extent at least this decision must be regarded as relevant to the current case and somewhat persuasive. The other authorities opened by the respondent can be distinguished from the current case by reason of, for example the qualifying criteria. I find there were no special compliance requirements to render an employee eligible for the bonus under the original 2004 agreement.

4.9 The question therefore comes down to whether in varying the agreement (leaving aside the industrial relations issues which are not relevant here) the respondent was in breach of the acts in including absence on maternity leave as an abating factor.

4.10 The provisions of the Acts in this regard are outlined in Section 6 as follows.

6.—F13[(1) For the purposes of this Act and without prejudice to its provisions relating to discrimination occurring in particular circumstances discrimination shall be taken to occur where—

(a) a person is treated less favourably than another person is, has been or would be treated in a comparable situation on any of the grounds specified in subsection (2) (in this Act referred to as the ‘discriminatory grounds’) …..

and the discriminatory grounds are stated as (among others)

(2) As between any 2 persons, the discriminatory grounds (and the descriptions of those grounds for the purposes of this Act) are—

(a) that one is a woman and the other is a man (in this Act referred to as “the gender ground”),…….

(c) That one has family status and the other does not (in this Act referred to as “the family status ground”),

4.11 Section 8 of the Acts prohibits discrimination in relation to ‘conditions of employment’ which clearly applies to the 2004 agreement and the variation in 2010.

5. DECISION

5.1 I have investigated the above complaints and make the following decisions in accordance with section 79 of the Acts that:

· Both because absence on maternity leave is a specially protected period and because it was included for the purposes of abating the bonus it is discriminatory on both gender and family status grounds as this is a consideration that only affects female, pregnant employees.

· I order the payment of the shortfall of the bonus to the claimant and that she should be paid the additional week’s pay for 2012 which was withheld.

· I also award her €6,000 being three months salary for the breach of her rights under the Acts. This figure represents compensation for infringement of her rights under equality legislation in relation to discrimination and does not include any element relating to remuneration, and is therefore not taxable.

· I further order in accordance with section 82 (1) (d) that the company terminate the practise of abating the periods spent on maternity leave for the purposes of calculating the bonus in the 2004 Agreeement.

____________________

Pat Brady

Equality Officer

December 2015