ADJUDICATION OFFICER DECISION
Adjudication Reference: ADJ-00030361
Parties:
| Complainant | Respondent |
Parties | Jennifer Healy | XS Direct Insurance Brokers Ltd |
Representatives |
| Lucy O'Neill Mason Hayes & Curran Solicitors |
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-00039884-001 | 17/09/2020 |
Complaint seeking adjudication by the Workplace Relations Commission under section 6 of the Payment of Wages Act, 1991 | CA-00039884-002 | 17/09/2020 |
Date of Adjudication Hearing: 28/05/2021
Workplace Relations Commission Adjudication Officer: Davnet O'Driscoll
Procedure:
In accordance with Section 41 of the Workplace Relations Act, 2015 following the referral of the complaint to me by the Director General, I inquired into the complaint and gave the parties an opportunity to be heard by me and to present to me any evidence relevant to the complaint.
Background:
The Complainant worked as a claim’s handler with the Respondent since 2015. She received an operational bonus in addition to salary every month. |
Summary of Complainant’s Case:
The Complainant was a claims handler with the company. She was notified of a reduction from her monthly wages of fifteen percent which applied from 28th April 2020. The following month she was notified of a reduction in her monthly bonus of fifteen percent in addition. The company initially said the reduction was due to the Covid-19 pandemic, but there was no reduction in the Complainant’s hours or workload. The Complainant was then informed the company would make the deduction regardless of her consent. In June of 2020 the company did not qualify for Covid-19 support scheme as its income had recovered. However, the company extended the pay cuts due to other costs for a further six months. The Complainant never signed any document to confirm her consent to the pay cuts. She was worried about her bills and could not afford the pay cut. She requested the pay cut, be reinstated but the company refused. The Complainant subsequently left the company and is owed €5,250 wages and €1,508.94 bonus total €6,758.94. |
Summary of Respondent’s Case:
The Respondent says the Complainant consented to the deduction from 1 April 2020 to 17th August 2020. After that the Complainant made clear she did not consent to the pay cut. The company was in a very difficult financial position following the pandemic and with Brexit. Sales dropped significantly. The company was in an extraordinary situation and chose to implement pay cuts rather than redundancies, as insurance claims had to be dealt with. The company submitted company accounts for 2019 and 2020 to verify substantial financial losses incurred in 2020 to the Adjudication Officer. The company submits that the reduction was proper and reasonable in accordance with S6 (2) of the Payment of Wages Act 1991 due to the financial circumstances of the company and no compensation should be payable to the Complainant. |
Findings and Conclusions:
I have heard and considered the written and oral submissions of the parties. The Complainant’s contract of employment with the company states the following:
“All salary and other payments if any shall be subject to deductions for PAYE, Pay Related Social Insurance (PRSI) contributions and other agreed and statutory deductions”. Staff of the company were notified of a pay deduction of fifteen percent in their wages in April 2020, with an additional fifteen percent bonus deduction commencing in May 2020.The company was in a difficult financial position and cut wages and bonuses in order to avoid redundancies. S5(1) of the Payment of Wages Act 1991 regulates deductions by employees and states no deduction shall be made unless- (a) the deduction (or payment) is required or authorised to be made by virtue of any statute or any 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. The Complainant says she never agreed to the deductions from her wages or bonus verbally or in writing. The company proceeded with the wage and bonus deductions, regardless of consent. There was no agreement to the deduction as required by S5 (1) (b) or consent provided by the employee as required by S5 (1) (c) of the Payment of Wages Act 1991. However, the company was in some financial difficulty and subsequently made twenty-four staff redundant in 2021. I find the complaint well founded and direct payment of €6,758.94 arrears of wages and bonus by the company to the Complainant. Taking into account the circumstances, I find compensation is not warranted. |
Decision:
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.
I find the complaint well founded and direct payment of €6,758.94 arrears of wages and bonus by the company to the Complainant. |
Dated: 18-01-2022
Workplace Relations Commission Adjudication Officer: Davnet O'Driscoll
Key Words:
Deductions from employee, authorised, compensation for employee |