EMPLOYMENT APPEALS TRIBUNAL
CASE NO.
UD1069/2014
PW124/2014
TE84/2014
WT164/2014
APPEAL(S) OF:
Jozef Lakatos -appellant
against the recommendation of the Rights Commissioner in the case of:
K Connolly Transport Limited -respondent
under
UNFAIR DISMISSALS ACTS 1977 TO 2007
ORGANISATION OF WORKING TIME ACT 1997
PAYMENT OF WAGES ACT 1991
TERMS OF EMPLOYMENT (INFORMATION) ACT 1994 TO 2014
I certify that the Tribunal
(Division of Tribunal)
Chairman: Mr. N. Russell
Members: Mr. T. O'Grady
Mr. J. Flannery
heard this appeal at Carlow on 11th October 2016 and 5th December 2016
Representation:
Appellant: Ms Andrea Cleere, SIPTU, Liberty Hall, Dublin 1
Respondent: Peninsula Business Services (Ireland) Limited,
Unit 3 Ground Floor, Block S, East Point Business Park, Dublin 3
Background:
This appeal came before the Tribunal by way of an employee (the appellant) appealing against the Decision of a Rights Commissioner (references: r-139498-ud-13/JT, r-138261-pw-13T, r-133152-te-13/JT, r-138272, 138274, 138275-wt-13/JT).
A Hungarian interpreter was present for the hearing.
At the outset of the hearing the respondent conceded it was the employer and consented to an amendment in this regard. The respondent’s name in this Determination differs from the respondent’s name in the Rights Commissioner Decision for this reason.
Summary of evidence:
It was the appellant’s case that he was initially paid €120/€130 per day. This sum comprised wages and subsistence. There was a dispute between the parties as to whether this sum was a gross or net figure.
A contract of employment was opened to the Tribunal. In the section entitled “remuneration” it stated that the appellant’s rate of pay would vary between €120/€130 gross per day depending on the type of work. It further stated that remuneration would comprise of pay and allowable subsistence rates taken from the Department of Finance and the Irish Road Haulage Association Agreement.
A letter of offer to the appellant was also opened to the Tribunal. It detailed some terms of the appellant’s employment including salary and stated that this salary would comprise of a weekly pay amount subject to PAYE and PRSI deductions. The document stated a rate of €100/€120 per day.
The company was inspected by NERA in 2012 and the inspection included a possible overpayment of subsistence to drivers. As a result the manner in which the company calculated the employees’ wages was reconfigured. The basic pay increased and the subsistence reduced which in turn meant that the employees were liable to pay more tax.
The appellant gave evidence that his complaints included being paid a flat rate of €60 for annual leave days and bank holidays. This sum did not represent the usual daily wage. The appellant stated that there were times that he was not paid for Saturday work.
The appellant stated that on other occasions he worked approximately 48 hours per week but did not receive overtime payment nor did he receive a Sunday premium payment for Sunday work. A number of time sheets were opened to the Tribunal during the hearing.
The Financial Controller for the company gave evidence that the company suffered a significant reduction in a large contract. This led to a pay cut being implemented in 2010 in order to alleviate the company’s losses. A letter issued to all employees informing them that due to an economic downturn all employees in the company were being asked to accept a 10% pay cut to help sustain the employment of all employees. The pay cut was later restored to the employees in 2015.
The appellant was unhappy with the reduction in wages that occurred as he felt that the company was busier than ever. He was not advised in advance of the changes to his terms and conditions nor did he accept the changes.
It was the appellant’s case that there were many problems regarding the payment of wages. The appellant contacted KC of the company in April 2013 to query his wages. A number of drivers also sought a meeting with KC on the 25th April 2013 regarding ongoing issues with wages but this meeting did not take place.
The appellant’s evidence was that he was instructed on a number of occasions to use the drive and rest switch in the vehicle and not the work switch. He stated that the loading and unloading of trucks should be part of driving time but the drivers were instructed to exclude this time in order to reduce the number of hours that showed as work on their tachographs. The Financial Controller gave evidence that the message to drivers may have just been a reminder to have the switch set correctly. A rest time was a full stoppage of work.
It was also the appellant’s case that he was expected to drive the truck when the load was overweight and he feared the loss of his license for doing so. He adduced documentary evidence from August 2013 in support of this evidence. He outlined that the documents showed that the vehicle was 4 tonnes overweight. The appellant found this situation very stressful as he knew he could be imprisoned in the UK for such an offence. He raised the matter with the Transport Manager who laughed at him and told him to “do the work”. The appellant also gave evidence of being asked to work abroad on more occasions than Irish drivers. He did not receive any extra payment for this work.
On 16th September 2013 the appellant attended his doctor who certified him as unfit for work due to a stress related illness. In the latter part of that month the appellant noticed that he had not received the usual Family Income Supplement (FIS). When he contacted the Department of Social Protection about this matter he was informed that the company had said he was no longer in employment. It was the company’s case that the payment could have been stopped for other reasons.
The appellant queried this matter with the company. The company responded by letter dated 18th October 2013 stating that they were obliged by law to inform the Department of Social Protection of changes to the appellant’s circumstances. Accordingly, they had notified the FIS section that the appellant was on sick leave.
It was the company’s case that on the 8th October 2013 they received notification that the appellant was bringing an unfair dismissal claim. This was the first indication the company had that the appellant had departed the employment. The claim was filed on the 1st October 2013 when the appellant was still on sick leave. However, the appellant continued to furnish the company with medical certificates after that date.
It was the appellant’s case that a union representative attempted to confirm with the company that the appellant’s position was there for him once he was well enough to return from sick leave. The company confirmed to the appellant that he was not dismissed by letter dated 26th November 2013.
In light of correspondence received from the union the appellant was invited to an informal welfare meeting on 4th December 2013. However, the meeting did not proceed on that date. The appellant wrote to the company in early December 2013 seeking a meeting after an upcoming medical appointment on the 11th December. In light of that correspondence confirming that he was on sick leave the company asked if he had retracted the unfair dismissal claim which he had lodged.
The appellant failed to attend the rescheduled meeting on the 23rd December 2013. Inter-party correspondence ensued in relation to rescheduling the meeting for a further date. A date of 24th January 2014 was set as the final rescheduled date but the appellant failed to contact the company. The company asked the appellant to state his intentions in circumstances where numerous attempts had been made to meet and discuss matters with him and in light of the fact that the company continued to receive medical certificates from him yet they had also been made aware of his intention to pursue a claim for unfair dismissal.
The appellant refuted that a meeting had ever been scheduled for the 17th January 2014 as the company contended. Any letters he received he had responded to. He did not receive all of the letters which the company said they had sent to him. The appellant wrote letter dated 10th February 2014 stating that with the exception of the letters of the 16th and 23rd December he had not received notice from the company to attend meetings.
The appellant felt that he had no option but to resign and did so by letter dated 10th February 2014. The appellant gave evidence of his financial loss. He secured new employment in May 2014 earning €120 net per day. He became fit to seek new work in or around April / May 2014.
A number of work sheets were opened to the Tribunal and evidence was adduced by both parties. The appellant claimed that he did not receive full pay for annual leave as he only received €60 per day on such days. His loss for those days was submitted as €60 per day. It was submitted by the respondent that the claim period for holidays was six months and that the claim for public holidays could only refer back to the period to the 2nd April 2013 from the date of the claim. The Financial Controller for the company gave evidence that the sum of €60 rather than €120 was paid as the sum of €120 included subsistence. The relevant regulations state that this should be deducted when making payment for a public holiday.
Payslip dated 9/8/13 was opened and contained a handwritten note that the appellant had queried that he was due an extra .5 day’s pay for 10/08/2013 but it was the company’s note on this document that the .5 day’s pay was included in another payroll cycle and that the matter would require further investigation.
The appellant adduced his loss regarding the taxation of expenses as €50/€60 on each occasion.
Determination:
This matter came before the Tribunal on appeal from a Rights Commissioner. The Tribunal conducted a full “de novo” hearing over two days.
On the claim under the Unfair Dismissals Act 1977 to 2007, the Tribunal finds in favour of the respondent. The appellant’s case is that he was dismissed in September 2013 when the respondent allegedly informed the Department of Social Protection that his employment had ceased. This was disputed by the respondent. The appellant did not adduce sufficient evidence before the Tribunal to point to the termination of his employment by the respondent. Thus the Tribunal upholds the Rights Commissioner Decision in this regard.
On the claim under the Payment of Wages Acts, the Rights Commissioner professed himself satisfied that the appellant had received his entitlements in that the issue was governed by a decision which the Commissioner believed was binding on him and had settled the distinction between “reductions and deductions” McKenzie & Anor-v- Min for Finance (2010) IEHC461
This Tribunal does not concur. The comments in McKenzie are obiter and, accordingly, not binding. Further, the comments related to specific allowances covering various expenses incurred by members of the Defence Forces.
The definition of Wages in the Payment of wages Act 1991 defines “Wages” as excluding reimbursements to an employee “in respect of expenses incurred by the employee in carrying out his employment”.
It is clear to the Tribunal that the appellant had a legitimate expectation to a net wage which the company paid by way of a combination of payment subjected to PAYE/PRSI and a payment classified as “subsistence” by the company.
It was clear from the evidence given to the Tribunal by the respondent’s Financial Controller that the appellant’s net wage was made up by way of a payment classified as a subsistence payment. There appears to have been a benefit to the company in dealing with the matter in this way. However, the subsistence payment in this instance was not the type of expenses payment envisaged by the Payment of Wages Act 1991 as being excluded from the definition of Wages. The Tribunal is satisfied that the subsistence payment was an element of the appellant’s Wage as defined in the Act.
The fact that Revenue allows this “subsistence” payment for tax purposes is of no concern to the Tribunal.
When the Respondent introduced an adjusted split between the payment subjected to PAYE/PRSI and subsistence payment so as to meet minimum wage requirements and to bring itself into line with NERA requirements this did not in the Tribunal’s opinion, entitle the respondent to reduce the appellant’s net pay.
The appellant had an average weekly reduction in his weekly net pay of in or about €54. The appellant lodged his claim on the 1st October 2013 and is entitled to recover for the six month period prior to that date and is awarded a sum of €1,404.
Similarly, as the payment classified as subsistence by the respondent was wages in this instance as defined in the Payment of wages Act 1991 the Appellant was underpaid holiday pay and public holiday pay.
The Tribunal awards the appellant holiday pay of €540 comprising payment for ten days annual holidays and €216 for four public holidays (paid previously at a gross daily rate of €60.00 only).
Thus the Tribunal upsets the Rights Commissioner Decision under the Payment of Wages Act.
The Tribunal is satisfied with the finding of the Rights Commission that the claim under the Terms of Employment (information) Acts 1994 to 2001 is not well founded.
The employee also lodged appeals under the Organisation of Working Time Act in relation to excessive working hours. The Tribunal’s jurisdiction under this Act is in relation to annual leave and public holidays only. These matters have been addressed by the Tribunal under the Payment of Wages appeal. Accordingly, the Tribunal dismisses the appeal from the Rights Commissioner under the Organisation of Working Time Act, due to lack of jurisdiction.
Sealed with the Seal of the
Employment Appeals Tribunal
This ________________________
(Sgd.) ________________________