Complainant

Respondent

Anonymised Parties

A Security Officer

A Security Company

Representatives

Appeared in person,

Act

Complaint Reference No.

Date of Receipt

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

CA-00021961-001

19/09/2018

This case centres on how a termination of employment pay slip was administrated. The Complainant, submits that he suffered an illegal deduction of €334.14, amended at hearing to €416.44, during receiving his termination of employment final pay slip dated 6 September 2018.

Complainants Case:

The Complainant is a Lithuanian National who worked as a Security Officer, 24 June 2016 until 30 August 2018 through a variable work pattern of part time and full-time commitment. He signed a contract of employment. This was his first job.

The Complainant gave an outline of his case and submitted documentation in support. He submitted that he gave notice of his intention to leave employment on August 16, 2018 which was accepted one day later. He sought a reference letter and acknowledged the valuable experiences he had gained while working as a student.

On 17 August, he received an email from the company requesting that he arrange to return all Company belongings, dry cleaned to the company. He arranged for his uniform to be dry cleaned and returned to the company.

He received 2 further pay slips. One dated 30 August 2018 which was not contentious and a second dated 6 September 2018 from which this case arose. This payslip reflected that he had earned gross pay of €416.44 and did not result in any direct payment as he was deducted two unanticipated amounts:

1 €84.12 Uniforms

2. € 334.14 Overpayment

On September 6, 2018 he raised this shortfall with his former line manager as he had left the company. He sought “a detailed explanation of each deduction on the pay slip “before 14 September 2018, after which he would reserve his rights under the Payment of Wages Act 1991 to contact a third party for legal assistance.

He did not receive a response to this submission and he had no further direct contact with the company until the day of hearing. The Complainant sought an itemised report to explain the deductions which he submitted were made illegally.

In responding to the Respondent submission, The Complainant argued that he had not been made aware in real time of the reason for the deductions

The Respondent operates a Security Company of 1200 employee. The Complainant was provided with a contract of employment which permitted that the company could recoup overpayments of holidays and overpayments where the uniform on termination of employment was not submitted in the prescribed manner, i.e. dry cleaned and receipted.

The Company is subject to Private Security Association guidelines and a uniform once recouped is cut up and destroyed. In the complainant’s case, the complainants uniform was submitted back to the Respondent encapsulated in a black plastic bag and unreceipted. This warranted a deduction in wages as provided for in the contract of employment .The parties had previously engage on this issue and  while the company had sought to explain this process through WRC mediation , the matter remained unresolved .The Respondent submitted that the correct deduction involving the Uniform ought to have been €100 but given the overpayment of annual leave of €334.14, there were insufficient funds in the gross pay to cover both .The Respondent reduced the uniform liability to €84.12 .

The Respondent submitted that their actions were covered by Section 5(1)(b) of the Act as the deductions were permitted by contract.

The Respondent tabled the annual leave records 2016-2018 which exhibited an overpayment of -29.44 hrs annual @11.35 euro per hour. The Respondent made the point that annual leave records were not indented on employees on line pay slips but were indented on the hard copy versions.

The Respondent went on to submit that the complainant should have known to raise issues of pay directly with pay roll rather than a line manager and the Respondent felt certain that this matter would have been discussed.

I have considered the facts of this case. The Complainant submitted on his complaint form that he had been deducted €334.14 on 6 September 2018. He sought to amend this at hearing to €416.44 to take account of the deduction attributed to the uniform. The Respondent did not object to this amendment and given that his complaint reflected the” plural deductions “I am mindful that I should allow that amendment. The Respondent furnished comprehensive responses to both aspects of the complaint.

The Complainant was requested to present his case in line with WRC procedures. He mentioned during the introductions that his Mother would be in attendance and I welcome her to the hearing at the same time as I welcomed the Respondents presence of Director of Human Resources and Payroll Manager. The Complainant confirmed that he was representing himself and that was accepted.

This was the complainants first job and there were no reported issues outside the final pay slip. I explained to the parties that I would decide on the claim of whether the deduction was in contravention of Section 5 of the Act or not. The Complainant had a more expansive expectation of the hearing and sought on several occasions that the Respondent would compile a report on the deductions and he sought minutes of the hearing. I encouraged the complainant side to consider the WRC procedural guidelines on Adjudication hearings. The Complainant was dissatisfied with this information.

The Complainant submitted that he had allowed a two-week response time to his email of September 6. On a careful review of this document, I noted that the email was sent at 9.49 pm on September 6 seeking a response before September 14, some seven days later. Of course, the respondent should have engaged with this communication and the lack of response was short of best practice. I asked the Respondent if they had any records of engagement on the request for information, there were none available to me.

I requested additional information from the parties. I sought a copy of the contract of employment. I also agreed to allow the complainant to make a submission on the holiday records presented at threading. I received the documents as requested. The final information in this case was received from the Respondent on 13 February, from the company payroll manager.

Section 1 of the Act defines Wages as: “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:

Provided however that the following payments shall not be regarded as wages for the purposes of this definition:

Section 5(1) of the Act prohibits deduction from wages save for a term of statute, contractual term or express permission in writing.

I reviewed the contract of employment signed by the complainant at the commencement of his employment and this established two keys clauses in relation to this case.

1 The Complainant had delegated authority to the respondent to deduct excess of holiday pay over entitlement. I have considered the complainants presentation on the report of excess holiday pay. I have also considered the response. It is regrettable that the Respondent did not communicate their intention to make this deduction prior to completion. I can understand the complainants disappointment to see a last pay slip evaporate. I note that the Respondent confirmed that the complainant had elected to receive an electronic pay slip, where the total of annual leave was not available to him outside a hard copy. I would also emphasise that the parties ought to have joint discussions on this issue prior to referral to the WRC.

I have considered both parties responses on the annual leave and I must resolve the conflict in favour of the respondent. The complainant could not benefit from cessor pay under the Act as he had overtaken his leave. While he disputes the €334.14 overpayment in favour of €181.94, I must find in favour of the respondent records on €334.14. I find that the Respondent is entitled to rely on Section 5(1) of the Act, having made a deduction based on a contractual term. I am not, however satisfied at the manner in which this transaction was completed, and it should have been prefaced by an explanation and a written notification to reflect a respectful employment relationship.

I find this aspect of the complaint to be well founded.

I must now address the uniform related deduction. I cannot establish any contractual term to justify a deduction in wages if the Uniform, necessary for work was not returned in the preferred state. I did establish that the respondent could make a deduction from the value of uniform within the first 90 days of employment. That time had long since passed.

Section 5(2) prohibits a deduction from wages in the case of an act or omission of an employee in response to goods supplied by the employer which were necessary for work, 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.

In considering the Respondents submission on why the deduction was first quantified at €100 and later reduced to € 84.12 to fit into the quantum available on the wage slip, I was struck by an inconsistency.

The Respondent had submitted that once received, the uniform was for disposal/ destruction .I am at a loss at the enduring cash charge in that regard . I appreciate that there was unease surrounding the less than perfect state of the uniform on submission, however, once again there were no real time discussions to try and resolve this issue or written notification of the next step. It is not fair or reasonable to make an arbitrary deduction in wages without recourse to the terms of Section 5(2) of the Act .

I must find that that the Respondent did not have the protection of a contractual term here to justify this deduction.

I find that this aspect of the complaint is well founded.

Decision:

Section 41 of the Workplace Relations Act 2015 requires that I make a decision in relation to the complaint in accordance with the relevant redress provisions under Schedule 6 of that Act.

Section 6 of the Payment of Wages Act 1991 requires that I make a decision in relation to the complaint in accordance with Section 5 of the Act .

I have found that one aspect of the complaint, that is the deduction related to the Uniform amounted to an illegal deduction. I order the Respondent to pay the complainant €84.12 in respect of the breach of Section 5(2) of the Act.

Treatment of an overpayment of wages.