Complainant

Respondent

Anonymised Parties

Accountant

Performance Management Services

Representatives

Melanie Crowley of Mason Hayes & Curran, Heather Byrne, Amanda Ruane

Act

Complaint/Dispute Reference No.

Date of Receipt

Complaint seeking adjudication by the Workplace Relations Commission under section 6 of the Payment of Wages Act, 1991

CA-00014478-001

26/09/2017

The Complainant stated that he had completed the work for the financial year. He had therefore qualified for the bonus. He accepts that the bonus is discretionary but he always received it. He had therefore a legitimate expectation of receiving the bonus. The bonus is discretionary and may be withdrawn but in that financial year it was not withdrawn. The bonus was due to be paid in June. He relied upon the High Court decision in Cleary & Others v B & Q, which stated the “bonus crystallises at the time of earning”. Therefore, his bonus had crystallised at the end of the financial year, not at the pay-out date. He sought from the Respondent whether there was a written policy on the pay-out of the bonus and he was informed by e-mail from the company representative that there was no written policy. His position was made redundant. It was not his choice to leave the company therefore the pay-out date in June should not be applied to his situation. He was told by the Respondent that the reason why he did not receive the bonus was that he was not in employment at the pay-out date in June. As part of the severance agreement he was given a document on 31st March and was given till the following Monday 3rd April to accept it or forfeit everything except the statutory redundancy. He spoke to a solicitor who advised him that he had no choice but to accept the package or forfeit most of it.

He believes that he was coerced into signing the document of acceptance. He had a legitimate expectation of receiving this payment. He had earned it. He had worked for the entire financial year. He is claiming the bonus payment.

The Respondent stated that the Complainant received a severance package of €8,835.62 statutory redundancy, €4,089.97 in outstanding holiday pay and €41,152.38 in an ex-gratia payment. He entered into a clear and unambiguous settlement with the company in the form of a severance agreement which was signed by the Complainant on 3rd April 2017 after he had the benefit of taking full independent legal advice. There was a clear understanding by both parties that this was a full and final settlement between the parties. The settlement agreement states that the payments being made were in full and final settlement of all statutory contractual rights and entitlements connected to the Claimant’s employment. The Respondent has relied upon the judgement of the High Court in Sunday World Newspapers Limited v Kinsella and Another [2007] IEHC 324 “the agreement is expressly stated to be in full and final settlement and that means what it says”. The fact that professional advice had been received before the agreement was signed was also significant. His solicitor witnessed the signing of the agreement. This agreement clearly stated “payment of the ex-gratia amount is subject to you waiving any rights you have or may have against the Company”.

It is their position that the Complainant’s claim cannot succeed in circumstances where he signed a severance agreement and must be considered full and final settlement of his claim. He had full knowledge of the disputed matter when he signed the agreement. Therefore, the claim under this Act must fail.

I note that the Complainant’s claim is for the non-payment of a bonus that he believed was properly earned and should have been paid to him.

I note that there was a severance agreement signed by both parties which was in full and final settlement of all matters relating to this employment.

I note that the Respondent is relying upon this severance agreement in its defence of this claim.

In view of this severance agreement it is not appropriate that I should consider the merits or otherwise of the bonus structure and payment procedure.

This matter has been superseded by the all-encompassing severance agreement.

While I note that the Complainant had a short time to consider the matter before signing he had the benefit of legal advice, who recommended that he should sign and this legal adviser witnessed the signature.

I note that the Complainant is an adult and a qualified accountant. Therefore, I have no doubt as to his understanding of or the import of this severance agreement.

I find that the agreement is clear and precise. It is in full and final settlement and as cited in the High Court decision in Sunday World Newspapers Limited v Kinsella and Another [2007] IEHC 324 case the agreement means what it says, full and final.

So there the matter rests.

I find that the Complainant has freely entered into an agreement with the benefit of legal advice and so is bound by that agreement.

Therefore, he has no right to amend that agreement unless both parties are agreeable to do so and in this case the Respondent clearly is not agreeable.

Therefore, that agreement stands and this claim must fail.

Non-payment of Bonus