Complainant

Respondent

Anonymised Parties

Assistant

Tourism Body

Representatives

Lorraine Williams Chief State Solicitor's Office

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-00000496-001

28/10/2015

The Complainant has been employed with the Respondent Company since 10th April 2007. She is paid €2173.67 gross per month and she works 22 hours a week. The Complainant referred a complaint to the Workplace Relations Commission on 5/11/2015 alleging the Respondent had breached Section 5 of the Payment of Wages Act, 1991 in relation to pension deductions. The Complainant had been provided with a written statement of her Terms and Conditions of Employment.

The Respondent Company is one of the participant bodies in the North/South Pension Scheme. Following legislative changes in the UK and Northern Ireland to Public Sector Pensions Schemes, it was decided to unilaterally apply these changes to Scheme Members based in Ireland. One of the changes was a substantial increase in the level of pension contribution by the employee from 1.5% of pensionable pay to 5.45% of pensionable pay, as well as substantially poorer pension benefits. This increased monthly deduction amounts to €93.36 a month – payslips provided. These changes were applied to employees in the Republic of Ireland from 1st April 2015. This the Complainant maintains is a breach of Section 5 of the Act.

The Complainant argues that any deductions can only be made if required by statute, or with her agreement and this is not the situation. Neither has the Complainant given any other party any express or implied right to negotiate on her behalf or to agree any contractual amendments. The Pension Scheme contribution rate was part of her terms and conditions of employment. The Pension Scheme Rules are not incorporated into her contract of employment and the only reference to them is that “you will continue as a member of the North South Pension Scheme”. In the event that the pension scheme rules were part of her Contract of Employment, which is not accepted, the express written terms take precedence over any term imported from a subsidiary document.

The Pension Scheme Rules can be amended and the Complainant stated she accepted the right of the Respondent to amend these. The Complainant stated that she is not aware of any legislation or statutory instrument enabling the Respondent to change her express terms of her contract without her consent. She also stated that the Department of Public Expenditure and Reform did not have this right.

The Complainant provided copies of Counsel’s opinion on the issue of whether the North South Pension Scheme is a statutory instrument and the Respondent’s response to this opinion and a further response from Counsel.

The Complainant referenced a number of similar complaints which they asserted had been successful and a further case which they stated had been settled prior to a hearing in the High Court.

The Respondent Company was set up in December 2000 under the British Irish Agreement Act, 1999 to manage the promotion and marketing on an all-Ireland basis. The Respondent referenced Section 3(1) of (named) Memorandum of Association, the Minister for Public Expenditure and Reform has express powers.

The Complainant commenced employment on 10th April 2007 and in accordance with the terms of her contract she was automatically enrolled in the North South Pension Scheme as a core member. On 26th January 2010 the Complainant received a new Contract of Employment to reflect the fact that she was moving to part-time working arrangement and this states that “You will continue as a member of the North South Pension Scheme………You will contribute at a rate of 1.5% of your salary as at present.”

The North South Pension Scheme was set up in 2005 and while the Respondent was not one of the six original implementation bodies referred to in the Act of 1999, the North South Pension Scheme equally applied to employees of the Respondent. The Respondent was defined as one of the “bodies” covered under the new Scheme. This scheme has been amended on seven occasions with the approval of the North South Ministerial Council. This Scheme was particularly attractive to employees of the Respondent as the Pension Scheme was uncoordinated, meaning that on top of their occupational pension, members would also receive the state contributory pension once they reached state pension age.

In July 2013 the Minister for DEPR and the Minister for Finance and Personnel Northern Ireland agreed to reform the Pension Scheme and it was agreed that parity of Core Terms must continue on both sides of the border. These changes were to take place on 1st April 2015 having been agreed at the North South Ministerial Council in February 2015. The main amendment was that it introduced parity of contribution rates for all as higher rates had been introduced for Northern Ireland Members from 1st July 2014.

The Department of Public Expenditure and Reform acknowledged that the increase in contributions was significant and to address concerns raised agreed to delay the implementation in order for conciliation negotiations take place before the Labour Relations Commission. Following talks on 14th and 27th March 2014 where members were represented by IMPACT and SIPTU the LRC issued a letter dated 24th April 2014 which confirmed that all members in the South of Ireland were to be given the option of Core Scheme Membership or Reserved Rights Scheme which would involve no net increase in pension contributions. All members were to be clearly advised of their options and that their decision to opt for either the Core Scheme or the Reserved Rights Scheme would take effect on 1st April 2015.

The Complainant was advised that if she wished to remain in the Core Scheme her pension contributions would increase from 1.5% to 5.45% of her monthly salary. The Complainant was also advised that if she opted for the Reserved Rights Scheme her contribution would remain at 1.5% but she would not receive the additional benefit of the State Contributory Pension when she reached the state pension age. The Complainant and all the employees were asked to confirm by 31st March 2015 as to which pension scheme they wished to opt for and it was made clear that if they did not opt by that date then they would automatically remain in membership of the Core Scheme. The Complainant did not opt by 31st March 2015 and therefore she remained in the Core Scheme.

This issue has already been determined by the Labour Court in Determination No. PWD 1643 dated 9th December 2016. Therefore it is submitted that the Complainant is bound by the conciliation agreement which preceded the introduction of the increases on the 1st April 2015.

On the basis of the evidence from both Parties I find as follows –

This issue has been determined by the Labour Court in a very detailed Decision Determination NO. PWD 1643 dated 9th December 2016 in which the Court held that that complaint was not well founded.

In accordance with Section 41(5) of the Workplace Relations Act, 2015 I declare this complaint is not well founded. The Labour Court has already issued a detailed Determination on this issue.

Payment of Wages Act, 1991 – increase in pension contribution on 1st April 2015 – Complainant given an option to remain in the Core Scheme with the resultant increase in pension contributions or opt for the Reserved Rights Scheme with no increase in pension contributions. – Complainant choose not to opt for either by 31st March 2015 – she therefore remained in the Core Scheme with the resultant increase – complaint not well founded as the Labour Court has already determined the issue.