Complainant

Respondent

Anonymised Parties

A Pharmacist

A Healthcare Provider

Act

Complaint/Dispute Reference No.

Date of Receipt

Complaint seeking adjudication by the Workplace Relations Commission under section 13 of the Industrial Relations Act, 1969

CA-00033398-001

18/12/2019

The employee is employed as a Senior Pharmacist working with a healthcare provider. He commenced employment in March 2002 and worked in a number of different clinic locations.   In August 2019 one of those clinics, where he had worked for 15 years, closed. In the intervening years the employee had reduced his work commitment to that clinic due to educational commitments. At the time of the closure he was working one weekend per month in that location. He contends that the employer has not paid him correctly for his loss of earnings relating to this closure.

The employee outlined his employment history from March 2002 and confirmed his reduced hours due to educational commitment. He confirmed that one of the clinics where he worked closed in August 2019 and that he was not contacted by his employer or offered alternative work. He advised that he contacted his line manager on several occasions and that finally she advised him to contact another manager in a different area who might have work available. When he made contact that manager confirmed that they had work available but only covering for staff absences. Due to concerns regarding the safety of such an arrangement the employee declined the offer. The employee also outlined that following further discussion with his line manager it was acknowledged that there could be risk associated with the proposed arrangement and that the constraints of the employee’s availability due to educational commitments was also a limiting factor in finding suitable alternative employment.   In these circumstances it was accepted that the employee would be paid loss of earnings in respect of the reduction in hours suffered as a result of the clinic closure.

The employee then sought a meeting with the relevant HR representative to confirm the arrangements but was refused as he was advised in writing that he was not an employee of that particular area. He was also advised that as he wasn’t an employee of the area he had no entitlement to a loss of earnings. The employee pointed out that regardless of which area he is deemed to be assigned to, he is an employee of the employer. The employee confirmed that he was seeking either a fixed alternative place of work with hours equal to those lost and compensation for the hours already lost or in the alternative compensation for the full and ongoing loss of earnings.

The Employer confirmed the closure of the clinic and the impact on the employee in terms of loss of earnings. The employer also confirmed their acceptance that the proposed arrangements to cover for staff absences could pose risk and in those circumstances this option was not being pursued. The employer confirmed that it was accepted that compensation for loss of earnings in accordance with the provisions of the national agreement was the appropriate mechanism to address the matter.

At the hearing the employee acknowledged that the employer had confirmed their willingness to address the matter by means of compensation for loss of earnings, but he raised concerns as to the methodology for calculating the loss.   The employee pointed out that on occasion he might be asked to provide short term cover in his current work location and that in order to assist his manager and his colleagues he would make himself available if at all possible. He proposed that this type of ad hoc work should not be considered in calculating loss of earnings. He also pointed out that within the timeframe relevant to the calculation of loss of earnings a pay increase had occurred and that this should also be discounted when calculating the loss.

The employer clarified that all loss of earnings calculations are based on a standard formula arising from the national agreement i.e. that the loss be calculated based on the earnings in a full twelve month period both before and after the change. In this case the change occurred in August 2019, the relevant comparator years are August 2018 to July 2019 vs August 2019 to July 2020. The employer contended that as the relevant comparative period has not yet been reached it is not yet possible to calculate the loss of earnings. The employer was unclear how the salary increases which occurred in year 2 would be considered in finalising this calculation.

The employee considered the employer methodology to be incorrect and indicated that ad hoc work should not be considered. He contended that since he lost 12 weekends per annum each consisting of 12 hours of work, in total he lost 144 hours.   In these circumstances he contended that he should receive compensation of a sum equal to 144 hours at his hourly rate of pay. He also contended that this methodology was applied on a previous occasion, approximately two years earlier when he had experienced a previous loss of earnings.   He further contended that another colleague had previously been paid in accordance with the methodology he was proposing.

At the hearing I was struck by the employee’s interest in his work, his focus on professional development, his support for his manager and colleagues and his commitment to patient safety. Notwithstanding the bona fides of those representatives present at the hearing on behalf of the employer I was also struck by the failure of the employer to act in a reasonable manner when handling significant change that had serious consequences for the employee. Regardless of what area an employee is assigned to or what area holds the pay budget there should be clear and unambiguous arrangements in place to assist an employee to have their grievances addressed within the workplace. It is also clear to me that if an employer is planning to close a service it has an obligation to consult with the employees impacted by that decision in advance of the closure. In the circumstances which occurred in this case representatives on behalf of management should have engaged with all employees impacted by the decision to close the clinic and real efforts should have been undertaken to find suitable, safe, alternative employment. Instead this employee found out that the closure had occurred when he returned from leave in September 2019 and was left to fend for himself in terms of seeking alternatives. When the question of compensation for loss of earnings arose, he was then passed around from one area to another, with nobody taking responsibility for addressing his issues. In fact, he received correspondence where a HR representative refused him a meeting on the basis that he was not an employee of that specific area.

Based on the above matters I find that the treatment of this employee by the employer was unreasonable.

In relation to the methodology for the calculation of the loss of earnings I note the Labour Court recommendation in this regard (LCR 19995) which provided that “the compensation for actual loss of earnings arising from the new arrangement be calculated at 1.5 times the actual loss.   The level of loss should be established in each case by comparing earnings in a full twelve-month period in which the new arrangement has been in operation with a corresponding period in which the current system operated”. I note also correspondence which issued to the Public Service Committee of the Irish Congress of Trade Unions from Ms. Oonagh Buckley, Secretary of the Implementation Body for the Public Service Agreement dated 8 March, 2011 confirming that “ the members of the Body agreed to endorse this recommendation of the Court as the formula to be applied in the case of actual loss of earnings (in a context other than redeployment) under the Agreement to the Public Service Executive of the ICTU and to public services management in each sector”.

While it is not helpful that in similar circumstances different methods of calculation were applied within the same employer, such erroneous methodologies can never be considered an appropriate precedent and take priority over a precedent set by the Labour Court and endorsed by the National Implementation Body. Considering the above Labour Court recommendation and the position set out by Ms. Buckley on behalf of the Implementation Body, I find that the employer must calculate the loss of earnings on the basis of earnings from August 2018 to July 2019 vs earnings from August 2019 to July 2020.     I note that the Labour Court recommendation is silent in relation to the impact of pay increases in these circumstances and this is not surprising as at that time of the issuing of this decision the public service was operating in an environment of pay cuts rather than pay increases. On that basis I believe it is open to me to address that matter. It seems to me that if the employer was to include the pay increase as part of the earnings in year 2 then the earnings in that year would be artificially inflated. I therefore find that in calculating the earnings for year 2 the employer should deduct any additional earnings in year 2 that arise as a direct consequence of the pay increase and compare Year 1 earnings to Year 2 earnings adjusted for the wage increase.

Section 13 of the Industrial Relations Acts, 1969 requires that I make a recommendation in relation to the dispute.

Based on my findings above I make the following recommendations:

·       That the employee’s loss of earnings be calculated on the basis of earnings from August 2018 to July 2019 vs earnings from August 2019 to July 2020 adjusted to negate the impact of any pay increase in the second year

·       That the employee receive compensation of €2000 for the failure of the employer to consult and engage with him in relation to the change and it’s impact on him and for the failure of the employer to have appropriate arrangements in place to allow the employee address his grievance internally in a timely manner

I further recommend that the employer:

·       Put in place arrangements across all areas within the employment to ensure that adequate consultation takes place with employees in advance of the implementation of significant change

·       Review current arrangements for dealing with staff grievances and put in place revised appropriate arrangements to ensure that staff are clear as to whom they should address their grievances.

·       Issue guidance to all HR staff at local level providing clarity on the correct methodology to be applied in calculating loss of earnings in accordance with the recommendation of LCR 19995.

Loss of earnings, grievance handling, consultation on change