Complainant

Respondent

Anonymised Parties

A Member of Ground Staff

An Airline

Representatives

Deirdre Canty SIPTU

Rachel Barry, BL instructed by Arthur Cox

Act

Complaint/Dispute Reference No.

Date of Receipt

Complaint seeking adjudication by the Workplace Relations Commission under Section 18A of the Organisation of Working Time Act, 1997

CA-00031690-001

15/10/2019

This case surrounds a claim for a banded hours contract on behalf of a member of Ground staff represented by Deirdre Canty, SIPTU. The complainant has taken issue with the Band F offered and contends that she ought to have been offered a Band G.

The Respondent represented by, Rachel Barry BL disputed the claim and submitted while prefaced by an error in computation, the offer of Banded Hours contract F was an accurate reflection of the average hours worked over the preceding year.

Both parties made extensive written and oral submissions in support of their respective positions

The Union in this case, SIPTU opened a claim on behalf of the complainant, a member of Ground Staff from 27 April, 2015 . This claim is conjoined with three other cases detailed at the headline of this decision. The Union outlined that the complainant had a contract of employment for 20 hours, however, she was usually rostered in excess of this.

The Union contended that the complainant had been placed on the incorrect banded hours contract and sought that she be placed on the appropriate Band of hours as per section 18 A of the Organisation of Working Time Act 1997.

“ I was not placed on the appropriate band of hours “

The Union submitted a brief background that it had pursued full time hours for the grouping in which the complainant worked for several years. The members had an expectation that the new “banded hours legislation” would finally address this inequity for the staff and the complainant in this case.

Background of the case:

The complainant is employed as Check In staff and has a contact for 20 hours, exclusive of all breaks. On March 19, 2019, the complainant applied to be placed on a new contract to match her hours worked under the new Miscellaneous Provisions Act.

The Complainant was first notified of being placed on Band H, 37.5 hr week on 16 April 2019

On 1 May 2019, the respondent confirmed that an error had occurred through the “double counting of overtime” and notified that the complainant would be placed in Band G (average working week of between 31 and 36 hrs (35.6 hours), exclusive of all breaks), with effect from 16 April 2019.

A letter to this effect issued on the same day. The complainant signed for Band G on May 8, 2019 .

The Union submitted that the details of the review conducted were not issued to the complainant and this prompted a belief that the calculation of hours in the respondent conducted review were wrong and the complainant contended that she had been wrongly denied Band H.

The Union submitted that the respondent had not included the hours of full annual leave entitlement in the base numbers relied in deciding the appropriate banding. This resulted in a false and lower calculation of average hours for the Banded hours over the 12-month reference period.

The Union contended that the calculations for annual leave should be calculated on actual hours worked instead of the contracted hours as this would provide a true calculation for the reference period informing the Banded Hours and would result in the requested elevation to the higher band of H sought.

The Union exhibited pay slips, where annual leave was clarified

The Union proceeded to argue that the provisions of section 19 of the Act confirm the way the calculation of annual leave is to be applied.

Section 20(2)(b) sets down that annual leave shall be paid at the normal weekly rate.

Moving on to Section 16 of the Employment (Miscellaneous Provisions) Act, 2018 addresses” banded hours” and amends the Organisation of Working Time Act

The Union cited all sections and emphasised:

(4) the band of weekly working hours on which the employee is entitled to be placed shall be determined by the employer on the basis of the average number of hours worked by that employee per week during the reference period

The Union contended that the annual leave calculations in the complainant case were incorrectly recorded which in turn caused the calculation for the reference period to be flawed.

The Union, on behalf of the complainant contended that the respondent entered the 20 hours per week and not the average hours worked. The complainant sought an order to place her on the correct band of H.

The Respondent runs an Airline and operates a number of bases in the country. The Respondent was on notice of the conjoined claims referred to above and has responded in the case of the instant case by rejecting the Union claim. The Respondent confirmed that the complainant had been placed on the correct band.

Counsel for the respondent outlined the legislative background to the Employment (Miscellaneous Provisions) Act, 2018, commenced on March 4, 2019. She submitted that section 18A of the Act does not provide for any specific method of calculation to be applied when calculating entitlements under the Act.

The respondent stressed the operational background to the complainant’s base which is subject to seasonal commercial demands which have a direct impact on rostering. A seasonal variation in operating air craft exist and further 4% reduction is anticipated in 2020. The respondent is therefore compelled to adjust working patterns to respond to these commercial demands and this is known by employees from the outset of their employment.

The complainant in the case is a Guest services agent and has a contract of indefinite duration since October 2015, having commenced work in April, 2015. Irregular hours have been the hallmark of her employment. The   standard working week was described on the contract as 20 hours, where additional floating hours were an ongoing feature of employment based on the exigencies of the business and paid at an agreed rate of overtime. The respondent considers employees placed in Band H to be full time employees who are entitled to a contract for at least 37.5 hrs per week.

The respondent operates an automated time measurement and recording tool. This calculates the annual leave and holiday pay entitlement of those working irregular hours.

Counsel drew the hearings attention that absences from work were not earmarked by a measurement tool and in that vacuum, the respondent initiated a Banded Hours Policy, based on business exigencies. 130 employees have been offered banded hours arrangements in accordance with the Policy. Band H reflects a full-time working Commitment.

In addressing the current claim, the respondent submitted that the complainant had been absent from work for annual leave for 21 days during the reference period. The respondent having regard for the banded hours calculation only, incorporated the complainant’s pro rata contracted hours as equivalent working time. This amounted to a credit of 4 hours for each of the days marked as annual leave and was an entirely discretionary action by a responsible employer.

The respondent commenced a review of the average hours per week worked by the complainant prior to March 19 2019 in accordance with the Banded Hours Policy. On 16 April 2019 the complainant was informed that she would be placed in Band H category from 29 April 2019. However, this was incorrect as the recording of overtime, undertaken differently at different bases was calculated in error in the complainant’s case. This was addressed by the respondent and an apology issued for the acknowledged error.

On May 1, 2019 the respondent apologised to the complainant and was informed that the correct band applicable to her was Band G (31 to 36 hours). This was accepted by the complainant on 8 May, 2019.

The respondent has not disputed the legitimacy of the complainants request for a banded hours contract. The issue between the parties is the resultant band applied.

Counsel for the respondent submitted that the higher band sought by the complainant was not required by section 18 A of the Act. The respondent had operated a method of calculation compliant with the Act.

Application of Banded Hours Policy:

The respondent exhibited a copy of Banded Hours contract Policy, February 2019. The Banded Hours Calculation Administrator is to review the working hours reliant on a Banded Hours Working Hours Tool. The Respondent clarified that the Policy formulation had been the respondents work and not a collaborative exercise.

Acceptance Guidelines:

The band of weekly working hours in which the employee is entitled to be placed will be determined by the respondent based on the average number of hours worked by the employee per week during the reference period

The reference period was clarified as

meaning 12 months immediately before the employee makes a request in writing for their banded hours to be reviewed

The review consists of:

1 Clock In data

2 Basic Hours and overtime worked

3 No obligation to consider absences under S. 18 A

The Respondent exercises a discretion and reviews the absences of the applicant. Absences arising from annual leave, maternity and paternity leave, the working time equivalent to the applicants pro-rated contracted hours is used as a calculation.

4 The total hours worked are then added to the outcome of the calculation and then divided by 52 to arrive at the average weekly hours worked, the appropriate band. The aim of this calculation was to protect operational sustainability.

The respondent inserted a diagram which detailed the application of this process to the complainant which amounted to a bottom line permutation of 30.45807 which placed her in the Band F category.

1. Clock in data = 1,783.19 hours
2. Annual leave     21 days
3. Credit for annual leave = 84 hrs (4 hours per day)
4. Cumulative total inclusive of discretionary calculation on annual leave = 1,867.19 divided by 52 weeks = 35.9075

This placed the complainant in the appropriate band of G (31 to 36 hours )

The Respondent engaged in an analysis of section 18 A of the Act.

Counsel outlined that this was a new provision which amounted to a brand-new right and a brand-new calculation where the respondent carries the responsibility for band determination in accordance with the Act.

Section 18 A is intended to operate to ensure that an employee’s contract of employment reflects the hours worked by an employee over a reference period.

Section 19 provisions were limited to Section 19 only. Pay for annual leave refers to the calculations for the purposes of Section 20 and 23 of the Organisation of working Time Act, 1997.

In drawing on the terms of section 2(1) of the Act, Counsel emphasised that:

Working time means any time that the employee is

(a)    At her place of work or at her employer’s disposal   and

(b)    Carrying on or performing the activities or duties of her work

She submitted that the Act does not specify a method for calculating the appropriate band of hours to be applied.

S 18 (A) (4)

The band of weekly working hours on which the employee is entitled to be placed shall be determined by the employer based on the average number of hours worked by the employee per week during the reference period.

Counsel referred to the principles contained in S. 18A (13), where she submitted that the respondent was not obliged to offer hours of work in a week where there was no expectation to work or where the job was not being carried out and S. 18 A (14) which determines the parameters of the “ reference period “ as 12 months after commencement of employment and immediately before the request for banded hours .

The Respondent submitted that only hours worked in accordance with S2(1) should be considered for the banding calculation. There is no requirement to treat annual leave in a “manner analogous to how payment during annual leave is calculated in accordance with the 1997 Regulations “

Section 3 (1) of the Regulations is confined to determining the normal weekly rate of an employees pay for purposes of SS. 20 and 23 of the Act. This would conflict with the provisions of section 2(1) of the Act and would result in a distorted calculation of hours.

Counsel submitted that there could be no prohibition on a careful exercise of discretion by the respondent to provide some credit in respect of statutory leave to ensure that leave is taken and not resiled from by an applicant.

Counsel contends that it falls to the employer in the case to determine the appropriate banding based on an averaging of hours worked by the complainant during the referencing period. Accuracy of calculation plays a central role in this.

The respondent has an obligation to consider commercial and seasonal variation demands and the corporate treatment of absences is a key consideration for the respondent in Section 18 A of the Act.

Counsel stressed that the Legislation had not set down a calculator, inclusive of absences for the average number of hours worked by an applicant during the reference period. The respondent had sought to be fair in the establishment of a Banded Hours Policy to ensure consistency and efficiency while considering operational limitations and protective sustainability

The Respondent submitted that calculations undertaken to arrive at the banded hours offer of G were grounded on the average number of hours worked by the complainant per week during the reference period.

Counsel made the request to arrive at a finding that the complaint was not well founded.

I have considered both parties written and oral submissions in this case. I had some difficulty in interpreting the particulars of the claim as it lacked a stated focus target. I received clarification at the hearing and all parties were clear that the complainant was pursuing a Banded Hours Contract at H grading instead of her G grading.

The net issue in this case is how to establish a workers average weekly working hour in a reference period for the purposes of S. 18 A of the Organisation of Working Time Act, 1997 as amended by section 16 of the Employment (Miscellaneous Provisions) Act, 2018.

Section 18 A introduces the concept of Banded Hours, which addresses a scenario where an employee’s contract of employment does not reflect the number of hours worked per week, the employee is entitled to be placed in a band A-H of weekly hours specified in the table of S. 18A.

This is predicated on a written application and the employee must be placed in a Band determined by the employer within 4 weeks from the date of request, pursuant to S18A (2)-(4) of the Act.

Once placed on a band, the employee must be provided with working hours, which on average, fall within that band.

Section 18(8) creates a new complaint for redress before the WRC, where the employee believes that her employer has failed to place her in a Band within a 4-week period of request or unreasonably refuses a request to be placed in a Band. If upheld, the remedy of specific performance is allowed without an order for compensation.

This complaint was submitted to the WRC on 15 October 2019, where the complainant contended that she had been wrongly refused a Band H through an inaccurate calculation of hours worked.

The Respondent, while initially offering a Band H, withdrew this offer due to an error of computation of overtime and calculated that the complainant had worked an average of 35.9075 hrs per week which culminated in a Band G, exclusive of breaks.

Section 18 A provides:

Banded hours

18A

18A. (1) Where an employee’ s contract of employment or statement of terms of employment does not reflect the number of hours worked per week by an employee over a reference period, the employee shall be entitled to be placed in a band of weekly working hours specified in the Table to this section.

(2) In accordance with subsection (1) , where an employee believes that he or she is entitled to be placed in a band of weekly working hours, he or she shall inform the employer and request, in writing, to be so placed.

(3) The employee shall be placed by the employer in a band of weekly working hours from a date that is not greater than 4 weeks from the date the employee made the request under subsection (2) .

(4) The band of weekly working hours on which the employee is entitled to be placed shall be determined by the employer on the basis of the average number of hours worked by that employee per week during the reference period.

(5) An employer may refuse to place an employee on the band requested —

( a ) where there is no evidence to support the claim in relation to the hours worked in the reference period,

( b ) where there has been significant adverse changes to the business, profession or occupation carried on by the employer during or after the reference period,

( c ) in circumstances to which section 5 applies, or

( d ) where the average of the hours worked by the employee during the reference period were affected by a temporary situation that no longer exists.

(6) This section shall not apply to banded hour arrangements which have been entered into by agreement following collective bargaining.

(7) An employee placed on a band of weekly working hours shall work hours the average of which shall fall within that band for a period of not less than 12 months following that placement.

(8) Where an employee believes that his or her employer has failed to place the employee in a band of weekly working hours in accordance with subsection (3), having been requested to do so under subsection (2) or unreasonably refused a request to be placed on a band of weekly working hours, the employee may make a complaint in accordance with Part 4 of the Workplace Relations Act 2015 .

(9) A decision of an adjudication officer under section 41 of the Workplace Relations Act 2015 in relation to a complaint of a failure to comply with this section shall do one or more of the following, namely —

( a ) declare that the complaint was or, as the case may be, was not well founded, and

( b ) where the decision is that the complaint was well founded, require the employer to comply with this section and place the employee on the appropriate band of hours.

(10) Notwithstanding section 27(3)(c) , a decision in accordance with subsection (9)(b) shall not order an employer to pay compensation to the employee for the employer ’ s failure to comply with this section.

(11) Either party to proceedings under subsection (8) may appeal a decision of an adjudication officer to the Labour Court in accordance with section 44 of the Workplace Relations Act 2015 .

(12) A decision of the Labour Court under section 44 of the Workplace Relations Act 2015 , on appeal from a decision of an adjudication officer referred to in this section shall affirm, vary or set aside the decision of the adjudication officer.

(13) Nothing in this section requires an employer to offer hours of work in a week where the employee was not expected to work, or requires an employer to offer hours of work in a week where the employer ’ s regular occupation, profession or trade is not being carried out.

(14) In this section ‘ reference period ’ means a period of 12 months after the commencement of employment with the employer and immediately before the employee makes a request under subsection (2) , and a continuous period of employment with that employer occurring immediately before the commencement of section 18 A shall be reckonable for the purposes of this section.

TABLE

Bands of weekly working hours

There is no express provision on how absences from work are to be treated in establishing the average weekly hours worked during the 12-month reference period, 18(A) (14).

Both parties accepted that they had not entered into a Collective Agreement on this “averaging mechanism “and the work surrounding the Policy which was exhibited in draft form dated February 2019 was undertaken by the respondent who sought to take on the responsibilities for “averaging“ inherent in the Act. I could not establish any reference to calculation for absence due to annual leave in this Draft Policy dated February 2019.

There is no provision in the Act which deems time spent on annual leave (or other absences) as time worked for the purposes of S. 18 A.

In his book, Organisation of Working time Act, 1997, Anthony Kerr, BL in referring to the Labour Court case of Cementation Skanska v Carroll 38/2003 stated:

“the obligation to provide annual leave is imposed for health and safety reasons, regarded as a fundamental social right in European Law “

In drawing on the Labour Court case in Royal Liver Assurance ltd v SIPTU DWT 41/2001, he adds

Although the term” paid annual leave Is not defined in the Act, the Labour Court has ruled that is a term of common usage in Industrial Relations and it is well understood as meaning a period of rest and relaxation during which a worker is paid her normal wages without any obligation to work or provide any service to the employer “

Article 7 of EC Directive 2003/88/EC directs Member States to take measures necessary to ensure that every worker is entitled to paid annual leave of at least 4 weeks in accordance with conditions for entitlement to and granting of such leave laid down by national legislation.

A careful reading of Section 18(A) (4) suggests that what is to be determined is “the average number of hours worked by that employee per week during the reference period “which is a cumulative total of hours worked where the divisor is the number of weeks worked.

Total Number of Hours (TNH)

---------------------------------------               =         Average Number of Hours for Reference

Number of Weeks worked

The Respondent reflects this result matrix in the Acceptance Guidelines of draft 2 of the Policy on Banded Hours

“the band of weekly working hours in which the employee is entitled to be placed will be determined by the respondent based on the average number of hours worked by the employee per week during the reference period.

The “Reference Period “means the 12 months immediately before the employee makes a request in writing for their banded hours to be reviewed “

While the respondent has not inserted the discretionary adjunct hours measurement in the draft Policy, Counsel explained that the respondent, while not obliged to factor in absences through statutory /sick leave, decided to credit absent days through annual leave at 4 hrs for each day of absence. This was calculated on an ex parte basis.

I have some difficulty with this adjunct. If this interpretation contended for by the respondent was correct the mode of establishing the average weekly working hours would be to take the total hours worked and divide it by 52, regardless of hours worked. This would always amount to a distortion.

For instance, an employee who works 39 hours every week, avails of 4 weeks annual leave per year. On a plain language understanding, her average weekly working hours are 39. However, if the annual leave is removed in its entirety and the 39 hours x48 weeks =1,872 divided by 52 would reduce this average to 36. This constitutes a declared variance.

The absence of any clear description on a mode or matrix of calculation to accompany the terms of section 18A (4) renders this section obscure and ambiguous. section 5 (1) of the Interpretation Act, 2005 provides, in effect, that where a provision of any Act is obscure or ambiguous, the provision is to be given a construction that reflects the plain intention of the Oireachtas where that intention can be ascertained from the Act as a whole.

The issue of working time has been the focus of labour market debate in both Ireland and EU over the past 4 decades and has been linked to safety and health at work and crystallised in section 19(1) of the Act.

An employee shall be entitled to paid annual leave equal to

(a)    4 working weeks in a leave year where she works at least 1,365 hours

(b)    ….

(c)     8 per cent of hours she works in a leave year, subject to a maximum of 4 working weeks.

Paid annual leave is inextricably linked to a working week.

Since August 1, 2015, employees who have been absent from work due to medically certified illness have been entitled to accrue annual leave as if they were at work. Section 19(1) (A) of the Act.

C-350/06 Schultz-Hoff [2009] ECR 1-179

The European Court of Justice concluded that the characteristics of working time could be found in an on site on call arrangement for Spanish doctors in the case of C-308/98 Sindicato de Medico de Asistencia   Public( SIMAP) v Conselleria de Sanidad y Consumo de la Generalida Valenciana

It seems clear that the Oireachtas intended that an employee should not suffer any disadvantage or diminution in her conditions of employment by taking annual leave. This is evident from Ss. 19 and 22 of the Act which provide in effect that time spent on annual leave and public holidays is to be regarded as time worked for the purposes of ascertaining entitlement under S. 19 and S. 21 of the Act

Section 22(2)

For the purposes of section 21, time off granted to an employee under that section or section 19 shall be regarded as time worked by the employee.

Having regard for submissions raised on Regulation 3 of the Organisation of Working Time (Determination of Pay for Holidays) Regulations 1997 (SI 475/1997), this provides that average weekly pay is to be determined by reference to time worked in the prescribed reference period.

Normal weekly rate of pay

—      3(1) The normal weekly rate of an employee's pay, for the purposes of sections 20 and 23 of the Act (hereafter in this Regulation referred to as the “relevant sections”), shall be determined in accordance with the following provisions of this Regulation.

(2) If the employee concerned's pay is calculated wholly by reference to a time rate or a fixed rate or salary or any other rate that does not vary in relation to the work done by him or her, the normal weekly rate of his or her pay, for the purposes of the relevant sections, shall be the sum (including any regular bonus or allowance the amount of which does not vary in relation to the work done by the employee but excluding any pay for overtime) that is paid in respect of the normal weekly working hours last worked by the employee before the annual leave (or the portion thereof concerned) commences or, as the case may be, the cesser of employment occurs.

(3) If the employee concerned's pay is not calculated wholly by reference to any of the matters referred to in paragraph (2) of this Regulation, the normal weekly rate of his or her pay, for the purposes of the relevant sections, shall be the sum that is equal to the average weekly pay (excluding any pay for overtime) of the employee calculated over—

(a) the period of 13 weeks ending immediately before the annual leave (or the portion thereof concerned) commences or, as the case may be, the cesser of employment occurs, or

(b) if no time was worked by the employee during that period, over the period of 13 weeks ending on the day on which time was last worked by the employee before the annual leave (or the portion thereof concerned) commences or the cesser of employment occurs.

The respondent has led out on an adjunct calculation of 4 hours per day to cover absence through annual leave. This did not arise through a collaborative engagement as the complainant approached the hearing unsure of the matrix used which kept Band H from her reach. It seemed unusual to me that the parties had not agreed an application form template to accompany the 130 Banded Hours contracts already issued at the enterprise.

I appreciate that a high level of confusion accompanied the discovery of the regional variation in the calculation of overtime.

I have considered the respondent submissions on the provisions of section 2 of the Act, where they contend that absence through annual leave constitutes an absence from work, not fulfilling the test for “working time “as physically present and active in the workplace. To balance this absence, they introduced a 1/5 divisor (4 hours per day) on an accumulated total of absence to arrive in this case as a credit of 84 hours 21x4 rather than 21x 7.5 hrs (pro rata). They did this to balance service exigencies and to avoid employees resiling from availing of annual leave. I have found that the respondent may have misinterpreted the spirit of Section 18(A) (4) in that regard. I appreciate that the respondent did seek external advice on the best practice computation but there was nothing forthcoming.

In the instant case, if the mode of calculation canvassed by the respondent were to prevail, as a matter of mathematical fact, in every case where an employee avails of annual leave, her average weekly working hours over a 12-month reference period would be artificially reduced below their actual average, or normal working hours. Such a result would be inconsistent with other provisions of the Act and could not reflect the plain intentions of the Oireachtas.

For all these reasons, it seems clear that an employee average weekly working hour in a reference period should be ascertained by taking the total number of hours worked by that worker over the reference period and dividing that number by the number of weeks actually worked in the same period.

In applying that formula, I have revisited the Respondent application of the complainant’s request. I have done this as the complainant’s application did not contain this formulaic detail:

Total Hours worked 1,783.19 + 21 annual leave days calculated on the basis of totalled annual leave rather than pro rata.

Divided by 52    

This amounts to the criteria for Band H.

I find that the claim is well founded.

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

Section 27 of the Organisation of Working Time Act, 1997 requires that I decide in accordance with Section 18 A of the Act.

I require the respondent to place the complainant on a Band H contract from 16 April 2019.

I would also advise the parties to agree a more robust engagement on information sharing of hours worked through the Time Management System for any application made under Section 18 (A) (4) of the Act.

Measurement of Annual Leave in Banded Hours Contracts