EMPLOYMENT APPEALS TRIBUNAL
CASE NO.
PW304/2014
PW306-309/2014
APPEAL(S) OF:
Mervue Creche Limited T/A The Little Acorn
- Appellant
against the recommendation of the Rights Commissioner in the case of:
Joan Brennan
Respondent 1
Eamie Murphy
Respondent 2
Ashley Kelly
Respondent 3
Patricia Kirwin Connolly
Respondent 4
Edel Irwin
Respondent 5
under
PAYMENT OF WAGES ACT 1991
I certify that the Tribunal
(Division of Tribunal)
Chairman: Ms. E. Kearney BL
Members: Mr. W. O'Carroll
Ms H. Murphy
heard this appeal at Galway on 3rd September 2015
Representation:
Appellant: Mr. Mike Cusack, Helix HR, Deerpark, Clarecastle, Co Clare
Respondent(s): Ms Noreen Parker, SIPTU, Liberty Hall, Dublin 1
This case came before the Tribunal by way the employer appealing the recommendation of the Rights Commissioner under the Payment of Wages Act 1991 reference: r-143406-pw-14, r-143410-pw-14, r-143409-pw-14, r-143412-pw-14 and r-143413-pw-14.
Background:
The respondents (employees) were employed as Childcare Leaders being paid an hourly rate of €12.50 per hour. The respondents submitted claims to the Rights Commissioner from March 2012 with a cut in their hourly rate. The respondent employees lodged complaints before the Rights Commissioners under the Payment of Wages Act, 1991 on the 8th April 2013, the 3rd October 2013 and the 31st March 2014 respectively. The Rights Commissioner upheld their appeal and awarded them respectfully.
The Rights Commissioner found in the respondents favour and awarded them the following amounts:
Respondent 1: r-143406-pw-14/SR - €82.96
Respondent 2: r-143413-pw-14/SR - €254.47
Respondent 3: r-143412-pw-14/SR - €258.09
Respondent 4: r-143409-pw-14/SR - €136.85
Respondent 5: r-143410-pw-14/SR - €115.63
The appellant company appealed the Rights Commissioner decisions to the Employment Appeals Tribunal.
Summary of Evidence:
The appellant company operates as a community crèche facility and receives government funding and is a non-profit making organisation. The Tribunal heard evidence that the company implemented deductions to the pay of the five named respondents. The respondent (employees) submitted that the deduction to their pay was unauthorised.
The first named respondent gave evidence of commencing employment with the company in September 2008 when the crèche opened. She is no longer employed by the appellant company. The employer informed staff at a meeting on the 11 May 2012 that a pay cut would be implemented. This was not negotiated or agreed with staff. A number of meetings took place and the employees were represented by their union however no agreement was reached. Initially the pay cut was €1 per hour for all room leaders. Rather than the pay cut being applied to five employees it was suggested that all employees would have their pay cut by fifty cent per hour. Twenty five cent per hour was restored in November 2013.
Board member of the appellant company gave evidence of meeting employees in November 2011 seeking suggestions on saving money. Government funding was being cut and savings were required to ensure the service continued. The company was in serious financial difficulty and in order to make savings the company changed service providers for waste, telephone and food suppliers as part of a cost cutting exercise. Employees were told that a cut to pay was a temporary measure. It was suggested that the pay cut be fifty cent across the workforce rather than €1 pay cut to the leaders. The funding provided by the government agency Pobail reduced from €178,793 in 2011 to €89,018 in 2014.
On the 4 June 2012 the pay cut was implemented across the board. In November 2013 a twenty five cent per hour rate was restored and following a further review in 2014 the rate of pay was fully restored in September.
The witness accepted that no written consent was sought or obtained from the employees in advance of implementing the pay cut and in hindsight agreed that written consent should have been sought. The witness added that at the meeting in May 2012 employees did not voice any objection. From a workforce of seventeen the five respondents were the only employees claiming this was an unlawful deduction.
Determination:
The Tribunal have carefully considered the sworn evidence and submissions adduced in this matter.
Section 5 of the Payment of Wages Act 1991 provides that:
“An employer shall not make a deduction from the wages of an employee (or receive any payment from an employee) unless-
(a) the deduction (or payment) is required or authorised to be made by virtue of any statute or any instrument made under statute,
(b) the deduction (or payment) is required or authorised to be made by virtue of a term of the employee's contract of employment included in the contract before, and in force at the time of, the deduction or payment, or
(c) in the case of a deduction, the employee has given his prior consent in writing to it.”
Having considered Section 5 (1) of the Act it appears no prior consent was sought in writing from the employer in respect of these deduction. As this is the case the Tribunal are bound to uphold the Rights Commissioners Decision under the Payment of Wages Act, 1991 and award the respondents the following respected sums:
Respondent 1: r-143406-pw-14/SR - €82.96
Respondent 2: r-143413-pw-14/SR - €254.47
Respondent 3: r-143412-pw-14/SR - €258.09
Respondent 4: r-143409-pw-14/SR - €136.85
Respondent 5: r-143410-pw-14/SR - €115.63
Sealed with the Seal of the
Employment Appeals Tribunal
This ________________________
(Sgd.) ________________________
(CHAIRMAN)