Complainant

Respondent

Parties

Thomas  Hickey

Dept Of Defence

Representatives

Jason Murray BL.   

Peter Leonard BL instructed by Jennifer Murray , Employment Law Section, CSSO.

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-00036103-001

11/05/2020

The Complainant is a former member of the Permanent Defence Forces and for the final one year of his service was employed as an Air Traffic Controller with the Air Corp.

Upon the completion of an Aerodrome Air Traffic Controller's course and promotion to the rank of Corporal on 15/11/2018, the Complainant was posted to 505 Squadron and began operational shifts as an Air Traffic Controller at Casement Aerodrome, Baldonnel. This position attracts extra allowances, namely technical pay and flying pay.

The Complainant was paid his Corporal Pay (his basic salary), his Technical Pay but not his Flying Pay.

This deduction in his wages amounted to €43.54 per week, which amounted to an estimated €2,177 during his tenure as an Air Traffic Controller.

 Numerous efforts were made by the PDFORRA representative to secure his underpayment and/or deduction in wages. Since leaving the Defence Forces the Complainant has also followed up by writing to the necessary personnel and the deduction and/or underpayment is still outstanding.

The last date of payment received by the Complainant from the Defence Forces was the 15/01/2020.

During the hearing of the complaint the rep from PDFORRA verbally outlined that the Complainant was not receiving his flying allowance although he was carrying out all the functions of an Air Traffic Controller.

Background 

The Complainant is a former member of the Air Corps, who served in 505 Squadron, 5 Support Wing up to his discharge, in or around 15 November 2019. 

The Complainant had previously served as a private within the Permanent Defence Forces. However, on 29th August 2018, following a two-year training course in air traffic control, he received his Air Traffic Control Tower endorsement qualification. 

As a result, he applied for a transfer from the Army to the Air Corps. This transfer took place on 14 November 2018 and the Complainant was promoted to the rank of Corporal on 15 November 2018. 

 It is the case that the Complainant had not at that point, completed the Non-Commissioned Officer (“NCO”) training which is normally required in order to be appointed to the rank of Corporal. However, as the Complainant had successfully completed his Air Traffic Control training, the Chief of Staff agreed to waive the NCO training requirement and appointed him to the rank of Corporal. 

However, due to the structure of the Air Corps - and the structure that applies generally in the Permanent Defence Forces - at the time the Complainant transferred to Air Traffic Control, the two existing Corporal positions were already filled by serving Corporals, who though serving as acting Sergeants, were awaiting promotion to the rank of Sergeant on a permanent basis. 

Accordingly, at that point in time there was not a vacant Corporal position in Squadron 505 available to the Complainant. 

However, in acknowledgement of the Complainant’s status as a newly promoted Corporal, and to ensure that he was able to avail of his technical grade while working in Air Traffic Control, the Complainant was assigned to a vacant Corporal position in No. 3 SP wing. This arrangement was entered into on a temporary basis on the understanding that the Complainant would transfer over to Squadron 505 once one of the Corporal positions therein became available. 

This arrangement was fully explained to the Complainant by his Commanding Officer who also explained to the Complainant that until he was assigned to one of the serving Corporal positions in Squadron 505, he would not be entitled to avail of the flying allowance which attaches to Air Traffic Control personnel within Squadron 505. As a result, she assured him that he would not be required to fly at any time, or engage in flying duties generally, while he was temporarily assigned to No. 3 SP Wing. 

It is strongly the Respondent’s position that the Complainant fully understood this arrangement and clearly accepted it. It is further submitted that the Complainant would have been fully aware that such arrangements have been traditionally applied within the Permanent Defence Forces, in circumstances where ranks must be vacated in order for new recruits to be appointed to those ranking positions.

Flying Pay.

In accordance with Defence Force Regulations S.3 “Pay and Allowances” Flying Pay is set out as follows at Section 19: 

“A non-commissioned officer or private filling a vacancy in the establishment of the Air Corps or Air Support Company, Communications and Information Services Corps, in one of the occupations set out in the tables in Schedule 6 and engaged on duties which require to be carried out in the air shall receive flying pay at the daily rates as prescribed in Schedule 6.” 

Accordingly, as contained in the Defence Forces regulations, Flying Pay is paid to personnel whose duties require them to fly in service aircraft. Therefore, it is important to state, that this allowance arises only where active participation in flying duties is required. 

In the context of air traffic controllers, flying duties would normally arise in the context of professional development; testing of procedures; flights associated with the planning or, the conduct of security operations. During the period 15 November 2018 to 15 November 2019, which is the operative period for this claim, Air Traffic Services personnel were required to fly 11days, both for professional development and security reasons.

PDFORRA COMPLAINT 

 It is acknowledged that on 14th March 2019, a representative of PDFORRA wrote to the Air Corps on behalf of the Complainant raising the issue of the Complainant’s entitlement to Flying Pay. In the letter the following is stated:

“Since his promotion, the Complainant has been deployed as an operational member of  505 SQN, therefore it is my view that appropriate administration should now take  place to ensure he receive all pay and allowances comparable with a 505 SQN CPL  vacancy, it is further my view that he should have his flying pay back dated  to his promotion date 15/11/18, to date he is at a loss of €41.37 per week  compared to his ATC Colleagues performing similar functions” 

 However, it is noteworthy that the PDFORRA letter accurately acknowledged the arrangement which had been entered into by the Complainant, whereby he had been temporarily assigned to No. 3 SP Wing until a Corporal position in Squadron 505 would become available. The letter said:

“To my knowledge both Corporal vacancies in 505 SQN are currently being held by two (2) individuals who are also holding Sergeant appointments in an ‘acting paid’ capacity, this would indicate that CPL xxxxx is holding a vacancy elsewhere in the Air Corps”.

However the position, as had been outlined by the Commanding Officer to the  Complainant when he first joined the Air Traffic Control division in November 2018,  namely that there would be no Corporal vacancy in Squadron 505 until one of the  existing Corporal’s was promoted and that he was not required to do flying duties  while temporarily attached to No. 3 SP Wing, remained the position until he retired  from the Air Corps, nine months later, in November 2019. 

The Law 

Section 5 of the Payment of Wages Act 1991 defines what constitutes an unlawful deduction from an employee’s salary as follows:

"S5 (1) An Employer shall not make a deduction from the wages of an employee (or receive any payment from an employee) unless -"

(a) the deduction (or payment) is required or authorised to be made by virtue of any statute or any statutory instrument made under statute, 

(b) the deduction (or payment) is required or authorised to be made 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." 

In the most recent High Court decision in this area, in Marek Balans v Tesco Ireland Limited [2020]IEHC 55 Mr Justice McGrath confirmed again that the Payment of Wages Act 1991 concerns only wages that are properly payable to a complainant. 

The case law in this area generally focusses on circumstances where an allowance which has been traditionally enjoyed by an employee has been withdrawn. It is important to state that in the context of the Complainant’s claim there is no suggestion of any withdrawal of an allowance, and instead the Complainant will have to satisfy this Honourable Commission that flying pay was properly payable to him as part of his salary. However, it is submitted that the case law, while not on all fours with the circumstances which apply in terms of the Complainant’s complaint, is helpful in that it sets out the approach the Courts have followed in closely related matters. 

In McKenzie and PDFORRA v Minister for Defence 2010 IEHC 461 - determined against the backdrop of the financial restructuring that occurred as a result of the banking crisis - Mr Justice Edwards was required to determine if the withdrawal of the RDF allowance to members of the Permanent Defence Forces by the Departments of Defence and Finance amounted to an unlawful deduction within the meaning of Section 5 of the 1991 Act. 

 In a well-known passage within his decision, Mr Justice Edwards made a distinction between a “deduction” and a “reduction” and ultimately concluded that the reduction of an allowance did not constitute a deduction from wages which were properly payable. He said: 

Finally, the Court agrees with the respondents' submission that the Payment of Wages Act, has no application in the circumstances of this case. First, as has been pointed out, correctly in the Court's view, the reduction in the PDF allowance is not a "deduction" from wages payable. It is a reduction of the allowance payable. The Act has no application to reductions as distinct from "deductions".  Secondly, even if that were not so, any alleged breach of the Payment of Wages Act, is not a justiciable controversy before the High Court in circumstances where that Act sets up a specific enforcement mechanism to be availed of elsewhere in such circumstances. 

While it is fair to say that in more recent related case law the High Court has on occasion taken a slightly different approach to that of Mr Justice Edwards, his finding in respect of reductions and deductions as applied to allowances remains the law. 

In Sandra Cleary & Ors v B & Q Ireland Limited [2016] IEHC 119 the most recent High Court case in this area, Mr Justice McDermott inter alia looked at the definition of wages and expenses as set out in Section 1(1)(i) of the 1991 Act in making his determination. In this instance the Employer had withdrawn an allowance traditionally enjoyed by Dublin based employees and the Court was required to determine if the withdrawal of this allowance amounted to a breach of the 1991 Act. 

Prior to the case ending up before the High Court, the Employment Appeals Tribunal had found that the allowance did not form part of wages properly payable and therefore the withdrawal of the allowance did not come within the terms of the 1991 Act. Mr Justice McDermott set out the position as follows: 

With respect to the zone allowance, the Tribunal considered the definition of wages and expenses under section 1(1)(i) of the 1991 Act that payments will not be regarded as wages for the purposes of the Act if they include: - ‘Any payment in respect of expenses incurred by the employee in carrying out his employment.’

The Tribunal's determination further states: - 

‘There can be no doubt that the allowance paid was a separate and distinct payment from that of the salary and had a separate and distinct purpose. Wages are paid in consideration of work carried out. Zone allowances were paid as a form of compensation for working in a particular area and therefore come under the umbrella of section 1 (1)(i) [of the Act of 1991].’ 

Mr Justice McDermott found that the Tribunal was correct in its determination. He concluded that the Zone Allowance in this instance, though not tied to directly expenditure on the part of the employee, as would normally be the case in terms of expenses, could still properly be regarded as a payment in respect of expenses and therefore did not form part of wages deemed properly payable.

He said: 

Section 1(1)(i) provides that any payment ‘in respect of expenses incurred by the employee in carrying out his employment’ is not to be regarded as ‘wages’ under the 1991 Act. The zone allowance in this case is clearly not a payment in respect of expenditure by an employee in carrying out the duties of his or her employment which is then to be recouped from the employer nor did the employer ever claim that it was.  It is claimed by the employer and was so found by the Tribunal, that the zone allowance was paid separately from the amount paid for basic salary for the purpose of ‘compensation for working in a particular area’ and is properly to be regarded as an expense based upon a wider definition than that of the more familiar ‘vouched’ expense. 

In London Borough of Southwark v O'Brien [1996] I.R.L.R. .420 Mummery J., considered the equivalent provision of English law contained in section 7(2)(b) of the Wages Act 1986. At issue was the withdrawal of a mileage allowance payable to an employee which, he claimed, was an unlawful deduction of wages under the Act.  The Industrial Tribunal determined that the allowance constituted wages because it provided benefit over and above an expense actually incurred. Mummery J., delivering the judgement of the Employment Appeal Tribunal overturning the decision stated:  ‘…when asking ‘Is the payment in respect of expenses incurred by the employee’?, it is not necessary for the payer to show that what he has paid is precisely a reimbursement of the sum expended by the worker. ‘In respect of’ means ‘referring to’ or ‘relating to’ or concerning in a general way, whereas the expression used by the chairman in his

decision, ‘payment of expenses’, would appear (wrongly, in our view), to equate the statutory provision with reimbursement of a precise amount’. 

The EAT concluded that the mileage allowance was an expense under section 7(2)(b).  I am satisfied to adopt the same approach to the interpretation of section 1(1)(i). 

Again, while the case law sets out how the High Court regards allowances generally, the circumstances which pertain in the Complainant’s case herein are more properly reflected in the recent WRC decision in An Area Manager v An Engineering Company ADJ-00028414. Here the issue of custom and practice, as an implied term of a contract of employment as well as direct assurances given by management, were central to the WRC Adjudicator’s decision making. 

In this case the employee had been placed on lay-off and he claimed that this amounted to a breach of Section 5 of the 1991 Act. At the hearing the Employer claimed that lay-off without pay had been established as a term of the Complainant’s contract of employment by way of custom and practice and accordingly no deduction had occurred. 

In his decision the Adjudicator held that custom and practice (such as layoff) can form part of an employee’s contract of employment as an implied term. However, in this instance the Employer had overridden this implied custom and practice term by making a specific commitment to the employee that lay-off would not be applied to him. On the basis that the employer had reneged on a clear commitment, the Adjudicator held that the Employer could not rely on custom and practice as a defence. 

The respondent submits that there is a custom and practice within Ireland, and particularly in the context of Covid 19, that periods of temporary layoff and short time working are without pay. Where such a custom and practice exists, this forms part of the employee's terms and conditions of employment, as an implied term.  Implied terms are terms of the employment contract that are not necessarily set out in writing or agreed orally but will nevertheless form part of the agreement between the employer and employee. Such clauses are not confined to implied statutory terms but

may also include clauses with which both parties might reasonably be considered to have agreed to. The final contract agreed between the complainant and the respondent must be seen in light of the exchanges that took place before it was signed. It is clear that it was expressly agreed that the employer would not have the right to lay off the complainant, or impose short time, as evidenced by the agreement of both parties to remove the enabling clause relating to layoff/short time. The removal of this clause can only reasonably be interpreted as an agreement that the respondent could not unilaterally impose a lay off or short time on the complainant and therefore this would supersede any implied term by custom and practice that might otherwise have existed. 

It is submitted that Adjudicator’s reasoning, as set out above, is relevant to the Complainant’s case herein in two respects. Firstly, the arrangement whereby a ranking position has to be vacated by the serving officer before a new recruit can be appointed to that ranking position, is well established within the Permanent Defence Forces. It is respectfully submitted that the Complainant would have been well aware of that custom and practice. 

Secondly, the outset of the Complainant’s appointment to the Air Traffic Control division, his Commanding Officer, clearly explained the position to him. She further assured him, that as the temporary role he had been assigned to did not have an entitlement to flying pay, he would not be required to engage in flying duties. Accordingly, at the time the Complainant commenced working for Air Traffic Control, both in terms of custom and practice and management assurances, he had been fully appraised of the nature of his arrangement and the reasons for it. Again, as has been clearly stated above, he was not required to do the duties upon which the flying pay allowance was based. 

The position that the Complainant found himself in and the subject of the complaint as presented under the Payment of Wages Act was not unique to the Complainant. In evidence we heard from the PDFORRA representative that this type of arrangement happens on a frequent basis, he then went onto provide the example of army personnel preparing to start an overseas tour of duty.

The arrangement whereby a ranking position must be vacated by the serving officer before a new recruit can be appointed to that ranking position, is well established within the Permanent Defence Forces. It was submitted that the Complainant would have been well aware of that custom and practice. 

At the commencement of the Complainant’s appointment to the Air Traffic Control division, his Commanding Officer, clearly explained the position to him. She further assured him, that as the temporary role he had been assigned to did not have an entitlement to flying pay, he would not be required to engage in flying duties. Accordingly, at the time the Complainant commenced working for Air Traffic Control, both in terms of custom and practice and management assurances, he had been fully appraised of the nature of his arrangement and the reasons for it. Again, as has been clearly stated above, he was not required to do the duties upon which the flying pay allowance was based. 

On 14th March 2019 the PDFORRA representative wrote to “Since his promotion, the Complainant has been deployed as an operational member of 505 SQN, therefore it is my view that appropriate administration should now take place to ensure he receive all pay and allowances comparable with a 505 SQN CPL vacancy, it is further my view that he should have his flying pay back dated to his promotion date 15/11/18, to date he is at a loss of €41.37 per week compared to his ATC Colleagues performing similar functions”.

This letter should not have gone unanswered.

Representative for the Respondent has mentioned Custom and Practice. In Employment Law (Tottel Publishing 2009 – General Editor Maeve Regan (chapter [3.67]) describes Custom and Practice as follows:

A term can be implied into a contract of employment by what is known as ‘custom and practice’. This arises where a custom or practice is so well known, clear and uninterrupted that it can be implied into the contract. Terms that are more frequently said to be implied by custom or practice relate to sick leave, ex gratia redundancy payments or leaves of absence.

The UK Court of Appeal (in Albion Automotive Ltd v Walker [2002] EWCA Civ 946) listed the relevant factors as follows:

a)      Whether the policy was drawn to the attention of the employees.

b)      Whether it was followed without exception for a substantial period.

c)       The number of occasions on which it was followed.

d)      Whether payments were made automatically.

e)       Whether the nature of communication of the policy supported the inference that the employers intended to be contractually bound.

f)        Whether the policy was adopted by agreement.

g)      Whether employees had a reasonable expectation that the enhanced payment would be made.

h)      Whether terms were incorporated in a written agreement.

i)        Whether the terms were consistently applied.

During her evidence the Complainant’s Commanding Officer informed the hearing that the Air Traffic Control function was operating with fewer staff than the established staff compliment. This resulted in a situation that saw the two approved Corporals carrying out duties above their rank and in receipt of the Flying Pay allowance, this made it impossible for the Respondent to receive Flying Pay allowance.

This situation was explained, albeit informally, to the Complainant by the Commanding Officer who believed she had reached an understanding with the Complainant.

In reaching a decision in this complaint I have to accept that custom and practice within the Defence Forces is well established and the Complainant and his PDFORRA representative were aware of this fact.

It is for this reason alone that I cannot find in favour of the Complainant and therefore must deem the complaint as not being well founded.

As outlined above.

Payment of Wages Act, 1991.