PWD1642

The Adjudication Officer issued the decision on 16 August 2016. The Complainant filed an appeal with the Labour Court on 6 September 2016. The case came on for hearing before the Court on 11 November 2016.

Background

The Respondent operates a large chain of retail supermarkets within the state. It employed the Complainant as a General Assistant in 2008. He was promoted to the grade of Team Leader in August 2010. Team Leaders are paid an additional payment of €1.25 per hour which he received on taking up the post.

In and around 21^stto 24^thSeptember 2015 the Complainant’s Manager instructed him to carry out a specific number of duties while at work. He refused to carry out the duties as instructed. The Manager reported the matter to her superiors and an investigation was initiated. This investigation ultimately led to a disciplinary meeting after which the Complainant was issued with a final written warning and demoted to the grade of General Assistant.

That decision was communicated verbally to the Complainant on 13 November 2015, was given effect on 16 November 2016 and confirmed in writing on 4^thDecember. However the letter of 4th December made no mention of the decision to return the Complainant to the General Assistant Grade with consequent loss of the Team Leader Allowance. This was described as an omission by the Respondent who corrected it by letter issued on 20th January 2016 but dated 4th December 2015.

The Complainant was advised that he was entitled to submit an appeal against the decision to demote him and or issue him with a formal Warning under the relevant procedures. He did not appeal under those procedures.

However on 25 January 2016 he submitted the instant complaint to the Workplace Relations Commission.

The matter came before the Adjudication Officer on 24 May 2016. Having given the parties an opportunity to submit relevant evidence and make relevant submissions he decided as follows

• “Based on the evidence presented at the hearing, I find that the Complainant is not well-founded and therefore fails. The Respondent had a legitimate right to demote the Complainant and to withdraw the additional payment the he received as a Team Leader. He filed to follow legitimate instruction from the Respondent”

Complainant’s Case

The Complainant submits that his appointment to the Team Leader Position was the subject of an express contract the terms of which, in relevant part, stated

“If at some stage you decide not to continue with the duties of a Team Leader or your performance is not satisfactory, you will move to a general assistant role and the additional payment will cease.”

He submits that on 25 September 2015 he was invited to a meeting the purpose of which “is to discuss an allegation of wilful and unreasonable refusal to carry out a legitimate instruction by a manager, and a failure to complete routine procedures correctly.”

The letter goes on to state

• “Please be advised that this allegation falls under serious misconduct, which may result in disciplinary action being taken, up to and including your dismissal in accordance with the Company Disciplinary Procedures.”

• “In certain disciplinary situations where the company decided to stop short of dismissal, and in particular, where the situation relates to incompetence in carrying out duties, the company reserves the right to demote/relocate a staff member to a more suitable position should the company decide that this is a viable , reasonable alternative to dismissal.”

• “Should a staff member not accept a demotion as an alternative to dismissal, the company will then follow the dismissal procedure. In cases where an individual chooses to avail of a right of appeal and follows the appeal procedure, they will work under protest for the duration of the appeal.”

He submits that he was subsequently notified by letter sent over six weeks later but dated 4th December 2015 that the sanction in fact included a demotion with loss of allowance. He submits that this was not a valid notification as it sought, with retrospective effect, to vary the decision already formally communicated to him.

He submits that his letter of appointment to the Team Leader position sets out the terms of his appointment and the terms on which he could be removed from that appointment. He submits that those terms relate to performance in the role and not to his conduct in the role. He submits that the reason outlined to him for effecting his demotion relates to his conduct and not to his performance and consequently submits that any sanction so grounded has no basis in contract and cannot be lawfully implemented. He further submits that as the decision to demote him infringes his contract of employment the consequent decision to deduct the Team Leader allowance from his pay infringes section 5(1)(b) of the Act.

He further submits that the company infringed its own procedures in the manner in which it demoted him. He submits that demotion is only permitted as a substitute for dismissal. Accordingly he submits that the company must show that it considered dismissal an appropriate sanction in this case but had decided to substitute it with a decision to demote instead demote him. Having done so the discretion to accept or reject that substitution moves to the Complainant who may decide to reject the decision to demote him and challenge the decision to dismiss him. He submits that in this case the Respondent never made a decision that the infractions committed by the Complainant justified dismissal. Accordingly, he submits, the Respondent had no right to proceed as though it had complied with a procedure it manifestly failed to adhere to. He submits that everything that flowed from that misfeasance can have no validity before the Court and the deduction of pay it made cannot be lawful.

Respondent’s Case

The Respondent submits that the Complainant was promoted to undertake the duties of a Team Leader and was paid accordingly. It submits that he continued to be bound by the full terms and conditions of employment that applied to him as a General Assistant. The promotion to Team Leader did not diminish these. Rather it augmented them.

It submits that there is a fundamental requirement set out in the contract of employment of all staff that requires them to carry out the lawful instructions of their managers. In this case the Complainant’s manager issued him with a lawful instruction. He refused to carry out this instruction despite being told to do so on a number of occasions. It submits that having investigated the matter the Respondent formed the view that the Complainant had engaged in gross misconduct. However it decided, in all the circumstances of the case, not to dismiss him from his employment but rather to demote him and to issue him with a final written warning.

It submits that there was no doubt in the Complainant’s mind that it had been decided to effect both sanctions against him. He had engaged with the Decision Maker and had had the decision clearly set out for him. Indeed it had been implemented as announced to him by the Decision Maker.

It admits that there was an error in the note confirming the sanction that subsequently issued to the Complainant. However it reiterates that there was no delay in effecting the correct sanction merely a delay in recording it in writing. It submits that when it noticed the error it immediately corrected it and continued with the sanction as implemented.

It submits that as the Complainant was not carrying out the duties of a Team Leader he was not entitled to be paid as one and consequently no improper deduction of wages could arise. It submits that it paid the Complainant his full entitlement for the work he performed and that it at all times acted in compliance with its procedures and with the Complainant’s contract of employment.

The Law

The Act defines wages in the following terms

“wages”, in relation to an employee, means any sums payable to the employee by the employer in connection with his employment, including—

(a) any fee, bonus or commission, or any holiday, sick or maternity pay, or any other emolument, referable to his employment, whether payable under his contract of employment or otherwise, and

(b) any sum payable to the employee upon the termination by the employer of his contract of employment without his having given to the employee the appropriate prior notice of the termination, being a sum paid in lieu of the giving of such notice:

Section 5 of the Act in relevant part states

5.—(1) 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.

(2) An employer shall not make a deduction from the wages of an employee in respect of—

(a) any act or omission of the employee, or

(b) any goods or services supplied to or provided for the employee by the employer the supply or provision of which is necessary to the employment,

unless—

(i) the deduction is required or authorised to be made by virtue of a term (whether express or implied and, if express, whether oral or in writing) of the contract of employment made between the employer and the employee, and

(ii) the deduction is of an amount that is fair and reasonable having regard to all the circumstances (including the amount of the wages of the employee), and

(iii) before the time of the act or omission or the provision of the goods or services, the employee has been furnished with—

(I) in case the term referred to in subparagraph (i) is in writing, a copy thereof,

(II) in any other case, notice in writing of the existence and effect of the term,

and

(iv) in case the deduction is in respect of an act or omission of the employee, the employee has been furnished, at least one week before the making of the deduction, with particulars in writing of the act or omission and the amount of the deduction, and

(v) in case the deduction is in respect of compensation for loss or damage sustained by the employer as a result of an act or omission of the employee, the deduction is of an amount not exceeding the amount of the loss or the cost of the damage, and

vi) in case the deduction is in respect of goods or services supplied or provided as aforesaid, the deduction is of an amount not exceeding the cost to the employer of the goods or services, and

(vii) the deduction or, if the total amount payable to the employer by the employee in respect of the act or omission or the goods or services is to be so paid by means of more than one deduction from the wages of the employee, the first such deduction is made not later than 6 months after the act or omission becomes known to the employer or, as the case may be, after the provision of the goods or services.

Section 5(6) of the Act states

Section 5(6) of the Act provides:
“Where—

• •(a) the total amount of any wages that are paid on any occasion by anemployer to an employee is less than the total amount of wages that is properly payable by him to the employee on that occasion (after making any deductions therefrom that fall to be made and are in accordance with this Act), or

  •(b) none of the wages that are properly payable to an employee by an employer on any occasion (after making any such deductions as aforesaid) are paid to the employee then, except in so far as the deficiency or non-payment is attributable to an error of computation, the amount of the deficiency or non-payment shall be treated as a deduction made by the employer from the wages of the employee on the occasion.”

The Court must first decide whether the claimed unlawful deduction was in fact properly payable to the Complainant. SeeDunnes Stores (Cornelscourt) Limited Trading as Dunnes Stores v Margaret Lacey,and Nuala O'Brien IEHC 417 2004 unreported Finnegan P.

In this case the Complainant was initially employed as a general assistant and paid the contractual rate of pay applicable to that position. That is not in dispute. He was subsequently promoted to undertake the work of a Team Leader and paid the agreed rate for that position. He was subsequently removed from that post and reverted to the grade of general assistant, undertook the work of that grade and was paid a rate of pay appropriate to that grade.

The Complainant rests his case on his contention that the decision to revert him to the grade of general assistant was not taken in accordance with the terms of his contract of employment.

The Court has examined that contention carefully. The Court notes that the Complainant’s contract of employment contains a provision that states “wilful and unreasonable refusal to obey a legitimate instruction given by a department manager or other members of management” will constitute serious misconduct. It goes on to state that where an employee is guilty of serious misconduct s/he may be issued with a final written warning or suspended from duty without pay or subject to demotion/relocation or dismissed or a combination of the above depending on the gravity of the situation.

The respondent decided that the gravity of the offence warranted both demotion and a final written warning as sanctions in this case. The Complainant was offered an opportunity to appeal against those decisions under the terms of the procedures in force. He chose not to do so. Accordingly the Court finds that he accepted or at least acquiesced in those sanctions and took no further action to challenge them.

In those circumstances the Court finds that he cannot now claim that having accepted that he would no longer hold the grade of Team Leader he can expect to be paid the rate for that grade. It further finds that as he was not performing the work of a Team Leader he has no grounds for maintaining that the rate of pay appropriate to that grade was “properly payable” to him.

Accordingly the Court finds that as the impugned allowance was no longer properly payable to him withholding it does not amount to an unlawful deduction within the meaning of the Act.

Determination

The Court determines that the complaint is not well founded. The decision of the Adjudication Officer is affirmed. The Court so determines.

Signed on behalf of the Labour Court



Brendan Hayes
CR______________________
29th November, 2016.Deputy Chairman



NOTE

Enquiries concerning this Determination should be addressed to Ciaran Roche, Court Secretary.