Complainant

Respondent

Parties

Denis  Babic

Reginald’s Tower Bar and Restaurant ltd (Title amended on consent)  

Representatives

  Appeared In Person

 Proprietor

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-00041766-001

25/12/2020

This matter was heard by way of Remote Hearing pursuant to Civil Law and Criminal Law (Miscellaneous Provisions) Act, 2020 and SI 359/2020, which designates the WRC as a body empowered to hold remote hearings.

On 25 December 2020, the Complainant, a Lay Litigant submitted a claim that he had been paid €770.69 less than what he was due to receive on 30 August 2020.

On 2 July 2021, the Respondent came on record. The Respondent took issue that the claim had been notified to the Pay Roll Administrator, who had not worked at the business in over 6 months.

The Respondent disputed the claim and requested to be given the opportunity for due process. At that point, he sought that Adjudication be reversed on grounds of lack of notification.

On 19 July 2021 the Respondent was advised that the hearing would proceed on 21 July and was invited to submit any documentation he was intending to rely on at hearing.

The Respondent submitted a written response to the claim on 19 July 2021, which was shared with the Complainant.

Both parties saw no difficulty advancing the case in the aftermath of Zalewski v Adjudication Officer [2021] IESC 24.

At the conclusion of the hearing, I sought access to pay slips, Revenue records and the Complainants balancing statement for tax year 2020.

The Complainant had difficulty maintaining his video on the remote platform. The Respondent agreed to proceed.

The Complainant had worked as a Kitchen Porter from 10 January 2020 to 29 August 2020. He did not have a contract of employment and was paid €10.15 per hour.

The Complainant submitted that he worked on average 48 hours per week. He stated that he only received payment for 35 hrs.

The Complainant found that he was underpaid by €770.00 and had approached the WRC for options to resolve this matter. He had previously approached the Company Accountant 6 or 7 times without a resolution. He was advised to pursue the matter with Revenue.

He submitted that pay slips had reflected €350 per week irrespective of what he worked. He confirmed that had received 33 hours pay in hours owed in addition to annual leave

The Respondent operates a business within the Hospitality Industry. He rejected the claim for payment of €770.00. He contended that the Complainant had received all payment owed.

The Respondent confirmed that the Business was closed from March 14- June 29 due to the Pandemic. The Complainant received the covid support payment.

The Respondent submitted that the business had a positive reputation for ensuring staff are paid fully as part of the overall mission statement that staff are always treated with respect and dignity.

He advised that the Complainant had entered employment with an unusually low tax cut off and tax credit. He understands that he was engaged in separate employment and half the tax-free allowance of his other staff.

During the Covid 19 Pandemic the business relied on the Temporary Wage Subsidy Scheme (TWSS) It was not possible to note the complainants’ hours worked on each weeks pay slip. However, he was provided with this detail of hours worked, inclusive of paid annual leave on his departure from employment.

Revenue advised that wage “top ups “applied to a reconciling exercise to bring wages to normal nett take home pay rather than gross pay. The Respondent submitted that the complainant had been advised on the correct application of TWSS   against his tax credit. He argued that he was confused regarding the application.

This involved calculating what a person’s normal take home pay would be after tax, USC, PRSI. This system would have been easily achievable for core hours working but became quite complex in a variable hour setting i.e., the complainants work pattern.

The Respondent exhibited the system adopted which he understood was replicated across the industry.

1 Identify Tax Credit and Cut Off Point

2 Calculate normal statutory reductions on gross pay of hours worked

3 Identify Potential for “top up pay “

4 Record Hours worked and diversify into hours worked and banked hours (TWSS linked to threshold)

5 Pay Wages and issue weekly pay with gross and nett details.

The Company passed a Revenue TWSS Inspection in October 2020. The process was flagged with WRC Inspectorate without concern.

The Respondent demonstrated an 8-week payment of wages breakdown, 6 of which weeks attracted the “banked hours “principle discussed.

The Respondent submitted that Revenue could resolve the complainant’s issue with pay and he confirmed that the complainant had been paid in full for all hours worked.

I have been requested to make a decision in relation to the claim for unpaid wages of €770.69. In reaching my decision, I have had regard for the parties oral and written submissions in addition to evidence adduced at hearing.

I have also considered the post hearing documentation submitted by the parties, the remainder of which was received early September 2021.

I did not have the benefit of a contract of employment in this case .

The context and background to the circumstances which arose in the case have their basis in the Emergency Measures in the Public Interest, Covid 19 Act, 2020.

In particular Section 28 on the evolution of the Temporary Wage Subsidy (TWSS). This was a State funded payment to Employers who could demonstrate a loss of 25% turnover between 14 March and 30 June 2020.

 It amounted to a “top up “payment on was based on nett pay, specifically the previous weekly average takes home pay based on January and February 2020.

Both parties to this case accept that the complainant received TWSS within the cognisable period of this claim.

 specified employee’, in relation to an employer, means —

(a) an individual who was on the payroll of the employer as of 29 February 2020, and the following is the case, the employer —

(I) has submitted to the Revenue Commissioners a notification or notifications of the payment of emoluments to the employee in February 2020 in accordance with Regulation 10 of the Regulations, and

(ii) has submitted the return required under section 985G of the Act for the month of February 2020 on or before the return date (within the meaning of section 983 of the Act) for that month.

It is clear to me that the administration of this payment is complex. I have reviewed the Respondent Excel sheet which charted the identification of the wages paid over July and August 2020. I have also reviewed the pay slips submitted by the complainant which governed this period.

I can see that the Complainants wages were identified in nett format over the 7 weeks of the claim. The TWSS was applied, and actual pay committed to the pay slip.

The Respondent made the argument that there were 33.32 hours withheld from that process and these were reconciled alongside annual leave and public holidays as the complainant left employment. I note that the final pay slip reflects a payment of €338.25 gross for these “loose hours”.

Wages are described in Section 1 of the Payment of Wages Act, 1991

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:

I asked the complainant to provide me with a structured breakdown of payments he believed that he had not received. He outlined 7 weeks of reduced payments which totalled €1106.91. I requested the pay slips to cross match this submission.

The Complainant accepted that he had worked the hours detailed on the Respondent submission. I appreciate that for 5/7 weeks these payments were two staged, this may have confused the complainant.

However, I have not identified a shortfall in payment of hours worked. I saw that TWSS and its successor EWSS were applied to 8 weeks’ pay, inclusive of cessation pay on 30 August 2020. I realise that the Respondent relied on nett pay as provided in the TWSS scheme. I note that details of the top up payment and move to PRSI J9 were properly delineated on the pay slips in accordance with the provisions of the Emergency Legislation.

To assist in my inquiry and mindful of the findings in ADJ 30547, a case in relation to a pay cut on consent and application of TWSS, I requested that the complainant provide me with a Revenue Balancing Statement. This was received and dated as 21 January 2021 and provided a refund of tax, usc and credit for tuition fees of €2,987.35 to the complainant.  This suggests to me that the complainant may have reconciled his perceived differential gross to nett pay loss. I understand that he received covid support payment prior to his return to work in July 2020. I also note that the complainant commenced full time employment in a new job in September 2020.

Section 5(1) of the Payment of Wages Act, 1991 prohibits a deduction in pay save for the circumstances of a term of statute, contract or consent.

I have not established a deduction in pay in this case. Instead, I found that the complainant was a participant in the TWSS scheme which “netted pay down “but did not reduce pay. I found that he was understandably confused by the application of TWSS and the fragmented system of pay, finally reconciled on 30 August pay slip.

I have found that the complainant was paid for his hours of work   between July and August 2020. The Emergency Measures Act ,2020 provides for an avenue of appeal to Revenue directly in Section 28 (12) 

(12A) A person aggrieved by an assessment or an amended assessment to relevant tax made on that person may appeal the assessment or amended assessment, as the case may be, to the Appeal Commissioners, in accordance with section 949I of the Act, within the period of 30 days after the date of the notice of assessment or the amended assessment, as may be appropriate. 

(13) Any amount of relevant tax payable in accordance with this section shall carry interest at the rate of 0.0219 per cent for each day or part of a day from the date when the amount is due and payable.

I have given the facts adduced in this case careful consideration and cannot agree that the complainant was deducted €770.69 from his wages at the respondent business.

I find the claim is not well founded.

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 that Act.