Parties:

Complainant

Respondent

Parties

Kate  Foskin

The Minister for Education

Representatives

Forsa Trade Union

Cathy Smith SC instructed by State Solicitors Office

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-00042594-001

19/02/2021

The Complainant is seeking to be retained on her Increment which the Respondent alleges was an error and the Complainant is seeking repayment or stoppage of any overpaid pay that has/will be deducted by the Respondent.

 The Complainant has previous employment with the DoE employed as a Teacher and following a break in service returned to work as an Educational Psychologist.

The Complainant commenced employment with the Department of Education on the 1st of February, 2019.

In early October 2020, the Complainant read an e-mail from the National Shared Services Office dated the 19th of August advising” Following a recent review by the National Shared Services Office (NSSO) Increments & Schemes Team of increments awarded under Circular 07/2019 (Application of additional increments awarded in relation to New Entrants under the Public Services Stability Agreement 2018-2020). I regret to inform you that we have established that you were awarded additional increment(s) under Circular 07/2019 in error. On commencement in your new position your starting salary was matched and you are not considered a “New Entrant” under the terms of the circular.   You are therefore not eligible to benefit from the additional increments provided for in Circular 07/2019.  As a result of this error, you have been overpaid since moving to Step 5 on 01/02/2020. In order to correct this error the NSSO Increments & Schemes Team have submitted Case Number: 1818512 to the NSSO Paycentre.   This case will instruct the Paycentre to place you on Step 4 (€62,531.00 pa) from 01/02/2020”

The Complainant happened to be on maternity leave around the same time and became aware of the e-mail after she received correspondence dated the 13th of October that was sent to her home address.The correspondence of the 13th October is an Overpayment Notification Letter from Peoplepoint, National Shared Services Office and sets out the value of the overpayment and how Peoplepoint intend to recoup the monies.

Following receipt of correspondence on the 13th of October, the Complainant received further correspondence of the 4th of February again setting out that she had accrued an overpayment of €1166.12 (gross amount) and deductions of €203.55 commenced on June 16th June 2021. It is worth noting that having applied Circular 07/2019 to the Complainants salary, they then reverted the Complainant on the pay scale effective from the 14th of August, 2020.

The Complainant contends that she is entitled to have the terms of Circular 07/2019(as referenced in the correspondence from the NSSO) applied to her case and failure to apply the terms of the circular to them has resulted in the non-payment of wages properly payable to the Complainant and as such is an unlawful deduction from wage.  This deduction is on-going.

In December 2010 a circular issued from the Department of Public Expenditure and Reform reducing pay for all direct entry recruits with effect from the 1st of January 2011.  Section 4 of the Circular sets out how the 10% reduction in salary should be applied. Under the Public Service Stability Agreement 2018 -2020 agreement was reached to give effect to the measure of intervention to salary scales of civil servants grades recruited since 2011 on the 1st of March 2019.

The Circular provides the terms that should apply to certain direct entry grades to the Civil Service recruited since 2011 that were subject to reduction under Circular 18/2010 as subsequently amended by Circular 02/2014.

It also provides for the implementation of Clause 2.31 of the Haddington Road Agreement – revised pay scales and allowances for persons recruited to certain direct entry grades. It sets out the revised pay rates that apply to civil service direct entry grades which were previously adjusted under Circular 18/2010 and also sets out how the terms should be applied to the Civil Service and to Public Service Bodies.

As set out in the introduction some time before August 2020 the terms of the relevant Circulars were applied to the Complainant and following review the Complainant was found not to have met the terms of the relevant Circulars and in the words of the NSSO they were deemed not to have been considered a ‘new entrant’ under the terms of the Circular.

The issue of whether an Educational Psychologist is one of the specific direct entry grades affected is not in question and is agreed between the parties as some of the grade have had the terms of the Circular applied to them.

The Complainant commenced employment with the Department of Education on the 1st of February, 2019. The Complainants previous employment with Enable Ireland commenced in September 2014 (employment through an Agency). On the 9th of February, 2015 the Complainant was offered a contract for part time hours directly with Enable Ireland which she took up but her working hours were full time hour’s right through until she was offered a permanent contract on the 1st of December, 2015 where she continued working full time hours.

On recruitment to NEPS, the Complainant was on maternity leave from Enable Ireland.  HR in the DoE advised her that they needed her to commence with them straight away. The Complainant advised HR that she was on maternity leave and she needed to return for 3 months before she would be available. HR sought permission from the Complainant to contact Enable Ireland to negotiate the 3 month notice required as they expressed that they considered the funding for both organisations to be ‘exchequer funding’ so there should not be an issue. (This information was exchanged in a phone conversation). The Complainant is not aware if this negotiation ever took place or not but she returned from maternity leave and served out her 3 months notice and took up the post with the DoE.

In other relevant correspondence dated the 18th of December 2020  from the Department of Public Expenditure and Reform to the Department of Education, the e-mail states:

 “Essentially where people joined the public service on point 3 or above, on a salary rather than incremental credit basis, the issue rests on whether there is public service history on points 1 or 2.  Following internal legal advice – agency and Section 39 experience, although paid on similar pay scales, does not qualify as eligible public service history under the terms of the Circulars. Regarding cases A, F and G I have now set out the position below, based on the information received and on the assumption that the individuals were not awarded incremental credit when joining the Department of Education and Skills. Standalone query from DES – Educational Psychologist with prior service in Enable Ireland. The individual is not eligible as the individual’s service at point 1 or 2 of the payscale is not reckonable as a Public Servant (i.e. the individual worked for a Section 39 grant funded agency).”

With reference to all of the above, we contend that there is in effect no differentiation that can be made between incremental credit and ‘salary matching’.  There was no formal agreement for ‘incremental credit’ for professional and technical grades in the Civil Service as ‘salary matching’ was incremental credit by any other name and every department in the Civil Service that had direct entry professional or technical grades took account of both service and existing salary at the time of recruitment.

If the only existing argument for the non payment of proper wages is based on the assumption that these Civil Servants were not awarded incremental credit when they joined the DoE then Forsa contend that there is no basis in fact for this assumption. Forsa acknowledges that Section 39 agencies are agencies under Section 39 of the Health Act 2004 where the HSE provides a grant to allow the agency to provide services similar or ancillary to the HSE.

It is widely accepted that the terms of the Haddington Road Agreement were implemented in various Section 39 organisations at the direction of the government at the time and the HSE despite the fact that they were not party to the Public Service Agreements. Both contracts submitted are evidence of this fact.

In October 2018, an agreement was reached by the parties at the Workplace Relations Commission in relation to a process of pay restoration for staff employed in some Section 39 organisations who are funded by way of a Service Level Agreement (SLA).

The agreement reached at the WRC noted that some of the organisations (approximately 250) which did not form part of the pilot phase of 50 organisation, were also likely to have pay restoration issues. A further WRC engagement followed in December 2020 in relation to a final phase of 250 SLA funded organisations who were identified as part of the earlier agreement. A payment arrangement for pay restoration was agreed.

If the government acknowledges that employees of up to 300 Section 39 organisations are entitled to pay restoration in line with Section 38 organisations for example, then it would appear that the same should apply to direct recruits into the Civil Service from those Section 39 organisations.

It is also noteworthy that the Department of Public Expenditure and Reform recognise that the current Incremental Credit agreement is not fit for purpose and so the parties are currently engaged in a process to amend same to take account of the different arrangements that apply in the Health and Education Sectors.

They have acknowledged the issues raised by Forsa particularly in relation to appointees to NEPS and have confirmed that it is proposed that the review will address the application and suitability of the current arrangements, section 39 organisation and related circumstances, developments in EU law; and the impact of Brexit. Having said this the current position taken by the Department of Education and the Department of Public Expenditure and Reform is that referenced above.

The Payment of Wages Act 1991 provides for the regulation of certain deductions made and payments received by employers and we contend that the employer has deducted properly payable wages to the Complainant by deducting the value of the restoration of pay from the Complainant and others as provided for in Circular 07/2019.

We contend that these circulars should apply to both cases as the terms of the Haddington Road Agreement which gives rise to these circulars applied to this case as evidenced in action and in previous contracts.

The Complainant is a new entrant into the Civil Service and they meet all the criteria as set out in the Circulars.

By complaint form received by the WRC on 19 February 2021, the Complainant complained that deductions were made from her salary contrary to the terms of the Payment of Wages Acts (“PWA”).

The HR Unit Department of Education (as stated on the Complaint form) is not the Complainants employer.  The Minister for Education is the correct Respondent.

The Respondent denied that it has acted in breach of the PWA. 

The Respondent denied that it has made an unlawful deduction from the Complainant’s Wages. 

The Respondent disputes that the Complainant has an entitlement to additional increments arising under Circular 07/2019. With the exception of an overpayment of wages paid to the Complainant in error, the Complainant has at all times received the wages which are properly payable to her. 

The issue for determination is what was properly payable to the Complainant as wages at the relevant time.  This requires consideration and interpretation of the following

Circular 07/2018

Circular 07/2019

Circular 04/2020

Public Services Stability Agreement

It is the Respondent’s position that Circular 07/2019 has never applied to the Complainant. Its terms were at one point applied to her in error which resulted in an overpayment of wages which is required to be reimbursed to the exchequer. 

The Complainant was appointed as an Educational Psychologist at the National Educational Psychological Service (NEPS) which is a section of the Department of Education with effect from the 1 February 2019. 

The Department made her a salary offer of €58,951. In making this offer to the Complainant the Department took account of her existing salary pertaining to her role in Enable Ireland.  The salary offered represented an increase in salary in the sum of €2,627  p.a. This was offered for the purpose of attracting the Complainant to the position.  

The Complainant accepted the salary offer which was at Level 3 of the Pay Scale. She was not subjected to serving time on inferior Haddington Road pay points while a civil servant. 

The Complainant was not awarded incremental credit as contended by her in her complaint form.  

In 2011, prior to the Complainant ’s appointment, the Government introduced new pay scales under the Haddington Road agreement.

In relation to educational psychologists a revised 13-point scale was introduced which contained 2 inferior starting points to the scale, which had not been in place previously. This meant that in practice a new recruit had to spend an additional 2 years' service to reach the maximum of the scale and they were 2 points lower than their counterparts who had been engaged before 2011.

The Complainant was not recruited at the starting point of the scale and in fact commenced her employment at Point 3 of the scale. 

The Public Service Stability Pay Agreement 2018 to 2020, ('the Agreement") which was reached in June 2017 sought to address the salary scales for new recruits at entry grades which had been introduced in the Haddington Road agreement. 

Section 4 of the Agreement makes specific reference to the arrangements for “those public servants recruited at entry grades since 1 January 2011”.  The agreement provides for a commitment to examining the pay scales “in respect of post January 2011 recruits at entry grades” within twelve months of the commencement of the Agreement.

The Complainant was not recruited at an entry grade post January 2011. She was recruited at point 3 on the scale. She has subsequently been awarded further increments on 1 February 2020 and 1 February 2021.

In 2019, in accordance with the Agreement, the Department of Public Expenditure & Reform introduced Circular 07/2019. This provides for skip increments for new entrants who were subjected to inferior lower pay scale points (1st and 2nd points) introduced by the Haddington Road Agreement. In order to qualify for the award of the additional skip increments an employee must be:

A new entrant.

A civil or public servant.

Have been subjected to serving time on the inferior pay points one and two of the pay scale as introduced in the Haddington Road agreement.

The Complainant was a new entrant, and a civil servant but she had not been subjected to serving time on the inferior pay points 1 and 2 as she was recruited at point 3 of the scale.

Accordingly the terms of Circular 07/2019 do not apply to her. 

The National Shared Services Office (NSSO) were requested to implement the Circular for the Civil Service. In relation to the Complainant it awarded her skip increments in error. This resulted in a salary overpayment and the NSSO notified the Complainant of the position in accordance with the terms of Circular 07/2018.

The Complainant ’s union contended that the Complainant and others may be in a position to show that they had been subjected to serving time on the two inferior Haddington Road pay scale points in the event that they had prior employment at the Health Service Executive. Further to this contention the Respondent engaged with the Department of Public Expenditure and Reform and it was confirmed that in the event that an employee was formerly employed as a public servant at the HSE after 2011, was a new entrant and served time on the inferior pay points that they may qualify under Circular 07/2019.

The Respondent sought information from the Complainant on her former employment in order to ascertain whether she satisfied the aforementioned criteria. The complainant duly provided a copy of her contract of employment with Enable Ireland.  Enable Ireland is a limited company registered with the Company Registration Office under company registration number 13909. It is also a registered charity.

The Respondent included the Complainant ’s position as part of a submission to DPER for consideration of the issue. DPER responded confirming that as the Complainant ’s former employment did not equate to public service employment. DPER further stated that as Enable Ireland is a section 39 body under the terms of the Health Act, 2004 she did not satisfy the condition of being a public servant. 

In contrast to Section 38 bodies under the 2004 Act, persons employed in Section 39 bodies are not public servants. 

Section 39 of the Health Act 2004, provides that the HSE may give assistance to any person or body that provides or proposes to provide a service similar or ancillary to a service that the HSE may provide. The HSE provides a grant to a range of private sector service providers under section 39. The HSE puts in place is service level agreement that sets out the level of a service to be provided for the grant. The employees of section 39 organisations are not HSE employees, they are not public servants and they are not encompassed by public service pay agreements. They were not subject to the FEMPI legislation. They are not members of public sector pension schemes; and unlike their section 38 counterparts, they are not directly bound by the Department of Health consolidated pay scales.

In these circumstances the Respondent cannot award the Complainant additional increments arising from her private sector employment. 

It is further clear that in her terms of employment at the Department she has not been subjected to serving time on the inferior pay points. 

Her employment at Enable Ireland was private sector employment in a private company and does not equate to public sector employment.

The Complainant’s contractual relationship with the Respondent commenced with effect from 1 February 2019. Accordingly it is not sustainable to claim as the Complainant has done that she has entitlements prior to this date which she claims the Respondent is obliged to discharge.  

The Complainant in her WRC complaint form bases her claim on her service at Enable Ireland to include an agreement facilitated and concluded by the WRC to which the Respondent is not a party. This is unsustainable.  

The NSSO issued additional skip increments to the Complainant in error. It is incumbent on the NSSO to recover and on the Complainant to pay, the overpaid sum in accordance with Circular 07/2018. This is further a term of The Complainant ’s contract of employment wherein she has agreed that:- 

“… any overpayment of salary or travel and subsistence may be deducted from future salary payments due to you in accordance with the Payment of Wages Act, 1991. In the event of such an occurrence, the Department will advise you in writing of the amount and the details of any such overpayment and give you at least one week’s notice of the deduction to take place and will deduct the overpayment at an amount that is fair and reasonable having regard to all the circumstances.”

The Respondent relies on Section 4(5) of the PWA in support of its position that the provisions of Section 4 do not otherwise apply to this situation where the deduction was made in respect of an overpayment of wages and it does not exceed the amount of the overpayment.  6.2. Section 4(5):-

(5) Nothing in this section applies to–

(a) a deduction made by an employer from the wages of an employee, or any payment received from an employee by an employer, where—

(i) the purpose of the deduction or payment is the reimbursement of the employer in respect of–

any overpayment of wages, or

any overpayment in respect of expenses incurred by the employee in carrying out his employment, made (for any reason) by the employer to the employee, and

(ii) the amount of the deduction or payment does not exceed the amount of the overpayment,

In order to determine whether there was an overpayment of wages, the Adjudication Officer is required to consider what wages were payable to the Complainant and, in particular what wages were properly payable to her at the time. 

While “wages” is defined in Section 1 of the PWA, in Sullivan v Department of Education PW 2/1997 (reported at [1998] E.L.R. 217), the Employment Appeals Tribunal took the word “payable” to mean “properly payable”.

The importance of establishing what remuneration was “properly payable” was also emphasised by Finnegan P. in Dunnes Stores (Cornelscourt) Ltd v Lacey [2007] 1 I.R. 478 and in MacGrath J. in Balans v Tesco Ireland Ltd [2020] E.L.R 125.

It is also important to consider Section 4(6) of the PWA. In Sullivan v Department of Education PW 2/1997 (reported at [1998] E.L.R. 217) the Employment Appeals Tribunal held that, if employees do not receive from the outset what is “properly payable” to them, then this could amount to a deduction within the meaning of the Act.

The Complainant relies on the terms of Section 4(6):-

(6) Where—

the total amount of any wages that are paid on any occasion by an employer to an employee is less than the total amount of wages that is properly payable by him to the employee on that occasion (after making any deductions therefrom that fall to be made and are in accordance with this Act), or

none of the wages that are properly payable to an employee by an employer on any occasion (after making any such deductions as aforesaid) are paid to the employee,

then, except in so far as the deficiency or non-payment is attributable to an error of computation, the amount of the deficiency or non-payment shall be treated as a deduction made by the employer from the wages of the employee on the occasion.

The Complainant was paid the wages that were properly payable to her, until an error was made by the NSSO in awarding “skip increments” to her under Circular 07/2019. There is no entitlement on the part of the Complainant  to such skip increments in circumstances where she was not a new recruit who had been required to commence at the inferior points 1 and 2 of the salary scale. Circular 07/2019 was specifically to address the situation of those persons and does not apply to The Complainant ’s circumstances where she was recruited at Point 3. 

The skip increments that were awarded to her were not properly payable and accordingly she received an overpayment of wages.

In accordance with Section 4(5) of the PWA the recoupment of the overpayment of wages in the manner agreed between the parties in the contract of employment, and in accordance with Circular 07/2018 complies fully with the terms of the PWA. 

There is no unlawful deduction from the Complainant’s wages on the part of the Respondent and there is no breach of the PWA. 

In addition to the submissions made above the Respondent responds to the following specific points raised by the Complainant in her submission, as follows:

The Complainant was not employed by the Respondent until 1 February 2019. In circumstances where she did not have service prior to this date as a public servant, the terms of Circular 18/2010 did not apply to her. 

On her appointment to her role with the Respondent, the Complainant’s previous salary in Enable Ireland was matched and in fact increased. Accordingly, she was not subjected to a salary decrease in her employment with the Respondent. 

Section 4.1.3 of the Public Service Agreement (2018 to 2020) provides that the government agreed to examine the issue of the increased length of salary scale in certain instances. This resulted in Circular 07/2019 which provides for two skip increments in order to enable employees who were subjected to having to serve on points 1 and 2 to attain parity with their peer workers going forward. the Complainant was appointed at point 3 of the scale and this circular did not apply to her. 

While Enable Ireland may have followed circulars on pay, they were not obliged to do so and this is not a relevant factor in the employment relationship between the parties to this complaint. 

Circular 07/2019 applies to civil servants only. This is clearly stated at paragraph 1.1 of the Circular. DPER Circulars addressed to Government Departments do not apply to the private sector.  While it is correct that the circular was applied to some Educational Psychologists, this was only where those persons were civil servants who had been placed on the first or second point of the scale, either in their employment with the Department or with a previous public sector employer. 

The Respondent took all efforts to properly consider the Complainant’s position. The HR Unit ensured that the recovery of overpayments was suspended while it sought previous employment information in support of the Complainant’s position. The HR Unit subsequently made a submission to DPER in respect of The Complainant ’s position. DPER confirmed that the service at Enable Ireland was not public sector service. On this basis the overpayment fell to be recovered. 

The factual assertions relevant to prior employment with a private employer do not support the claim that is made in this case. 

The condition pertaining to maternity leave in her employment with Enable Ireland is not a feature of public sector employment and further highlights the reality of The Complainant ’s prior employment with a private employer. 

The Respondent repeats its position that it did not award incremental credit to the Complainant . It is incorrect to equate the salary offer to the award of incremental credit, of which there is no documentary evidence to support such a contention. 

It is further the case that service in Enable Ireland is not reckonable as pensionable service in respect of the Complainant ’s civil service pension. This further demonstrates the differences in the periods of employment with a private sector employer and the Department. 

The points made in the Complainant ’s submission pertaining to the 2020 agreement is of no relevance to the Respondent or the Minister who was not a party to that agreement. This agreement however further demonstrates the different treatment between section 38 and section 39 bodies under the Health Act, 2004 and supports the Respondent’s position rather than that adopted on behalf of the Complainant. 

The Respondent further relies on email communications received from both the Department of Health and Enable Ireland to support the point that Section 39 are private organisations and further that Enable Ireland no longer align salaries with HSE pay scales. Insofar as they may have been aligned in the past, this was entirely a matter for Enable Ireland and was not pursuant to any obligation to do so. 

The Complainant has made a statement attributable to the Department of Public Expenditure and Reform and the Respondent requests that the Complainant prove the said statement.  This relates to a contention that  “the Department of Public Expenditure and Reform recognized that the current Incremental Credit agreement is not fit for purpose and so the parties are currently engaged in a process to amend same to take account of the different arrangements that apply in the health and education sectors.”

No documentary evidence has been provided in support of this statement. Further the Department has not been involved in any meetings or discussions with DPER in relation to incremental credits, on the basis contended for on behalf of the complainant. Further, this contention on the part of the complainant is in direct conflict with the email issued by DPER to the Department in which it is stated that service at Enable Ireland does not qualify under Circular 07/2019.

The Respondent submits that its version of events which is supported by documentary evidence is to be preferred over that advanced on behalf of the Complainant on this issue.

In any event, this point on the part of the Complainant does not advance matters in respect of the case that has been made on her part. 

The Complainant has no entitlement to be paid skip increments under the terms of Circular 07/2019.

The Complainant cannot satisfy the requirements in Circular 07/2019 in circumstances where prior to her appointment with the Department, she was not in public or civil service employment. 

The Respondent engaged with DPER in relation to the Complainant’s position proactively and positively and at all times has treated the Complainant fairly and reasonably. 

Once it was established by DPER that the Complainant’s prior service, was not civil or public service, the Complainant had accordingly been overpaid in error. The overpayment constitutes an overpayment of wages within the meaning of the Payment of Wages Act, 1991. The recovery of overpayments is a condition of the Complainant’s contract of employment and satisfies the terms of Section 5.5(a) i.1 of the Payment of Wages Act, 1991 and Circular 07/2018. 

Recoupment of the overpayment has properly and lawfully occurred in accordance with the contract of employment, Circular 07/2018 and the Act. 

There is no unlawful deduction on the part of the Respondent.

The complaint is not well founded. 

The Complainants contract of employment states her starting salary is determined (partly) by the Department of Public Expenditure and Reform Guidelines. Therefore, these guidelines are an expressed term of her employment. In order for the Complainant to prove that she should be retained on the original salary level she must have been a new entrant, a civil or public servant and been subjected to serving time on the inferior pay points one and two of the pay scale as introduced in the Haddington Road agreement. The Complainant was a new entrant and a public servant and was not placed on the first two points of the scale. The Complainants case that her prior service with Enable Ireland should qualify her for service increments on the scale is ill founded. Her employment with Enable Ireland was with a private company and while Enable Ireland may well have been following public service pay scales (matching as contended by the Complainant) that does not equate to time as a public servant. The argument that the Respondent consulted/engaged with Enable Ireland prior to the Complainant commencing employment with the Respondent on certain issues regarding the Complainants salary level does not confer public service with Enable Ireland as a result. The issue of whether the current situation is fit for purpose, which appears to be under review, is not relevant to this Decision as the Adjudicator has to deal with the situation as he finds it and not what might be in the future.

The Respondent incorrectly applied the Public Service Guidelines and applied a higher point on the scale to the Complainant based on an error of assessment of her circumstances. Therefore, under the Contract of Employment and Section 5 of the Payment of Wages Act 1991 the Respondent was entitled to correct this error and adjust the Complainants salary accordingly as the salary paid was not “properly payable”.  As a result any overpayments that were then recovered (or about to be recovered) by the Respondent and taken from the Complainants wages were taken properly within the law.

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. I Decide that the Complainant is not well founded.

Deduction of Wages