Complainant

Respondent

Anonymised Parties

A Sales Representative

A Mechanics’ Training Business

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-00027489-001

03/04/2019

The complainant worked for the respondent company as a sales representative from June 17th 2017 until December 21st 2018. He said that his employment ended due to redundancy. His complaint is that he was informed by his manager that, on the termination of his employment, he would receive one month’s pay as “a token of appreciation,” but he has not received this payment.

The complainant said that he received a letter on Friday, December 14th 2018, informing him that his employment would be terminated on December 21st, due to redundancy, “because of the loss of a big customer.” Due to an accident at work on November 26th, he was out sick when he received the letter.

The letter refers to a meeting on November 19th at which the complainant’s line manager informed him that his job was being made redundant and that, as he didn’t have enough service to qualify for a redundancy payment, he would be paid four weeks’ pay as a token of appreciation. This payment was conditional on the complainant signing a “Termination Agreement” which, according to his line manager’s letter, was delivered to him on Friday, November 23rd.

The complainant said that no meeting took place on November 19th and he didn’t receive any Termination Agreement on November 23rd, as referred to in the letter.

Having received his notice of redundancy on Friday, December 14th, the complainant said that his manager phoned him on Monday the 17th and confirmed that he would be paid four weeks’ wages. He also said that his manager said that he would be paid his wages while he was out sick.

On Friday, January 11th, the complainant returned all the company property in his possession and, on the same day, he received his final wages up to December 21st 2018 and his outstanding holiday pay. He did not receive the four weeks’ wages as a token of appreciation, as set out in the letter of December 13th.

Following the submission of this complaint to the WRC, the complainant said he received a telephone call from the respondent’s solicitor. The solicitor said that the company was willing to pay the complainant €2,500, equivalent to four weeks’ wages, on condition that he sign “a contract.” He said that he was unwilling to do so.

The letter of December 13th issued by the respondent’s general manager states that, on November 23rd, the complainant was sent two copies of a Termination Agreement, both signed him. The complainant was asked to sign both copies of the Agreement and to return one copy to the company. The letter of December 13th states:

“You agreed to sign the Termination Agreement on the 19th of November 2018 but have failed to do so despite being requested several times.”

The correspondence sent by the general manager to the WRC on June 5th 2019 states that the complainant was entitled to one week’s notice of the termination of his employment. He received this notice in writing on December 13th, although the manager said that, on November 19th, he had a meeting with the complainant and informed him that his job was redundant. The complainant said that this meeting did not take place.

The complainant submitted this complaint under the Payment of Wages Act 1991. Section 1 of the Act sets out a definition of Wages:

“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 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.”

This is a complaint about the fact that the complainant did not receive an “ex gratia” termination payment that he claims he was promised as a result of the redundancy of his job on December 21st 2018. It is apparent that the payment was on condition that the complainant signed a Termination Agreement. There is conflicting evidence about whether he received a copy of this Agreement before his employment was terminated.

Payments offered to an employee as an expression of gratitude at the termination of employment, often referred to as “ex gratia payments” are not covered by the definition of wages, as set out at section 1 of the Payment of Wages Act. For this reason, I find that I have no legal jurisdiction to adjudicate on this complaint. At the end of the hearing, I advised the complainant to get in touch with the solicitor who contacted him in June, and to seek advice regarding the terms set out in the Termination Agreement proposed by the respondent.

As I have concluded that “ex gratia payments” are not included in the definition of wages as set out in the Payment of Wages Act, I decide that this complaint is dismissed, because it is misconceived.

Ex gratia payment