ADJUDICATION OFFICER DECISION
Adjudication Reference: ADJ-00026343
Parties:
| Complainant | Respondent |
Anonymised Parties | Actuarial Trainee | Insurance Company |
Representatives | Self | HR Manager |
Complaint(s):
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-00033530-001 | 08/01/2020 |
Complaint seeking adjudication by the Workplace Relations Commission under section 6 of the Payment of Wages Act, 1991 | CA-00033531-001 | 08/01/2020 |
Complaint seeking adjudication by the Workplace Relations Commission under section 6 of the Payment of Wages Act, 1991 | CA-00033532-001 | 08/01/2020 |
Date of Adjudication Hearing: 07/08/2020
Workplace Relations Commission Adjudication Officer: Janet Hughes
Procedure:
In accordance with Section 41 of the Workplace Relations Act, 2015 and section 6 of the Payment of Wages Act 1991, following the referral of the complaint(s)/dispute(s) to me by the Director General, I inquired into the complaint(s)/dispute(s) and gave the parties an opportunity to be heard by me and to present to me any evidence relevant to the complaint(s)/dispute(s).
Background:
There are three CA numbers for this ADJ. At the hearing, the complainant confirmed that there is one complaint concerning one deduction from his wages. The complaint is concerned with the deduction of €2265.39 from his final salary payable when he was leaving the employment. The deduction was made by reference amounts the respondent claimed were deductible from his final salary for study costs incurred while he was employed as a trainee actuary. The hearing was conducted remotely by agreement with the parties. |
Summary of Complainant’s Case:
The complainant commenced employment as a trainee actuary in December 2016. His rate of pay at the time of termination was 4083.33 gross or 2900.16 per month. In May 2019 he spoke to a manager about his rate of pay indicating he felt it was below the market rate for the job. Subsequently he was informed that he was to be promoted. Subsequently he received documentation which extended his notice period from one to three months. He objected to this extension and he was unhappy with the level of remuneration and the training terms. His pay was increased without his having accepted the revised terms and subsequently when he met with management he was told to forget about the training contract for now. He eventually agreed to sign the promotion contract for the salary increase but indicated he would continue his job search. He did not sign or return the training contract. On 30 August 2019 he gave one month’s notice. He was then asked to return the signed training contract. He subsequently received an invoice for a total charge of €3265.39 of which €1000 remained outstanding as the full balance of his final nett pay due on termination was deducted or withheld by the employer. Legal correspondence sent on his behalf objecting to the deduction failed to resolve the problem and he then referred the matter to the Workplace Relations Commission. The position of the complainant is that at no stage did he sign any contract which allowed for the full deduction of his trainee costs and therefore he had never agreed to such a deduction, that the deduction was unreasonable, and he submitted ADJ-00019646 as a precedent. In that case the adjudicator held that the withholding of training fees from a final salary was unreasonable even though in that case the complainant had signed a contract agreeing to such a deduction. In his experience speaking to other trainees a full deduction of fees was not the case in all employment of this kind.
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Summary of Respondent’s Case:
The deduction of training fees prior to qualification is standard practice in the employment. The complainant enjoyed all the benefits of the training scheme. The complainant had signed a contract of employment in December 2016. He was also provided with a separate document entitled Actuarial Study Programme which clearly set out the terms of that programme with a specific clause regarding the reimbursement of fees in the event of resignation prior to completion of the course and provides for agreement to reimbursement of the fees by reference to clauses 9 and 15-17. The respondent accepts that they do not have a copy of the relevant terms signed by the complainant. However, given he claimed every benefit accruing for the scheme, they believe he received a copy of the terms at the time they were issued and was well aware of the respondent terms for supporting him through his studies. The respondent had not reviewed the terms of ADJ-00019646 and could make no comment on its applicability or otherwise in this current case. It was submitted that the respondent had followed the practice set out in the staff handbook in all other cases of this kind and to decide that the deductions were unlawful in this instance would set a precedent against the respondent. |
Findings and Conclusions:
Section 5 of the Payment of Wages Act,1991 contains the following provisions which are relevant to deciding this case: (1) An employer shall not make a deduction from the wages of an employee …….unless: (b) the deduction(or payment) is authorised or required to be paid by virtue of a term of the employee’s contract of employment included in the contract before ,and in force at the time of the deduction or payment, or (c) in the case of a deduction, the employee has given his prior consent in writing to it. These two clauses are intertwined in this case. On the balance of probabilities, the complainant did not receive the terms of the study scheme. The respondent has no copy of it signed by the complainant nor did they follow up seeking a copy. A systems failure perhaps, but the fact remains they have no evidence of him signing up to such terms as they are relying on to render the deduction lawful. It could be argued that the Complainant would not have agreed to taking the trainee position without some understanding that if he did not complete his qualification, there would be a deduction for course fees. As the respondent has asserted he claimed all the benefits of the scheme which he contends he did not see. I am satisfied that the complainant understood there could be some deduction of fees but genuinely did not expect to have incurred a full reimbursement of all fees at the time. A deduction was authorised by virtue of section 5 (2) An employer shall not make a deduction from the wages of an employee in respect of- (b) any goods or services supplied to or provided for the employee by the employee by the employer the supply or provision of which is necessary to the employment, Unless (i) The deduction is required or authorised to be made by virtue of a term of(whether expressed 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 of the circumstances(including the amount of the wages of the employee),and So even allowing that the complainant as a trainee actuary well aware of the norms of that programme regarding the conditions for being financially supported during training and having availed of the benefits of the study programme is found to have had an implied term of contract to repay some of the costs of his fees if he left the employment before achieving qualification, what occurred in this instance was not reasonable. The Respondent was reaching back over the full period of the employment a period spanning almost three years, the deduction was taken from his nett wages and the charge against him was in excess of his total gross wages on termination with a balance of €1000 in excess of his nett wages-leaving him without pay at the end of his months work for the employer in a promoted position, carrying greater responsibility, in September 2019. In effect , the respondent was deduction for good provided by them to the employee which were essential for his duties and reclaiming all those goods in one deduction. This represents a deduction which was neither fair or reasonable. The final amount factored into the total deduction i.e. €995 nett is deemed a fair and reasonable deduction in all the circumstances. |
Decision:
Section 41 of the Workplace Relations Act 2015 requires that I make a decision in relation to the complaint(s)/dispute(s) in accordance with the relevant redress provisions under Schedule 6 of that Act.
The Payment of Wages Act,1991 requires that I make a decision in accordance with the relevant redress provisions under section 6 of that Act.
The complaint brought by the complainant is well founded. The respondent is to pay the complainant €1270.39 nett. |
Dated: 2nd September 2020
Workplace Relations Commission Adjudication Officer: Janet Hughes
Key Words: Deduction of trainee costs on resignation.
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