ADJUDICATION OFFICER DECISION
Adjudication Reference: ADJ-00037000
Parties:
| Complainant | Respondent |
Parties | Luciana De Castro | Aon Ireland Limited |
| Complainant | Respondent |
Parties | Luciana De Castro | Aon Ireland Limited |
Representatives | self | Maeve Griffin Fieldfisher |
Complaint(s):
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-00048323-001 | 26/01/2022 |
Date of Adjudication Hearing: 12/09/2022
Workplace Relations Commission Adjudication Officer: Brian Dalton
Procedure:
In accordance with Section 41 of the Workplace Relations Act, 2015 following the referral of the complaints to me by the Director General, I inquired into the complaints and gave the parties an opportunity to be heard by me and to present to me any evidence relevant to the complaints.
Background:
The Complainant resigned her position from the Respondent employer. In her complaint form the following was ticked: I did not receive the appropriate payment in lieu of notice of termination of my employment At the hearing, the Complainant confirmed that this complaint had been withdrawn. However, two other matters while not ticked on the form were specifically detailed in the complaint form concerning holiday pay and an entitlement to a bonus. The complaint relating to holidays was withdrawn. However, the Respondent in a preliminary application stated that the Commission and Adjudication had no jurisdiction to hear these two separate matters as the Complaint that issued related to “the appropriate payment in lieu of notice. It was argued by Respondent that these two other matters concerning payment for holidays and bonus are not properly before the Adjudicator and should be dismissed.
Evidence was given under oath and the opportunity to cross examine was provided. The hearing facilitated the Complainant to attend by electronic platform and the Respondent attended in person. |
PRELIMINARY MATTER
A preliminary matter was raised by the Respondent concerning two other matters raised by the Complainant in the narrative of her form but not ticked on the form. It was argued by Respondent that these two other matters concerning payment for holidays and bonus are not properly before the Adjudicator and should be dismissed. The Adjudicator requested any authorities on that point to be opened.
The narrative in question is as follows:
Noticed started 10/12/21, last day of employment 07/01/22. I had 11 days AL left to be taken in 2021, manager accepted 5 days carry forward to 2022 leaving me with a balance of 6 days to be taken or paid in 2021. I did not take extra days in 2021 therefore I am due 6 days AL. Jan 2022 AL is 0.5 days plus NY bank holiday = 1.5 day. That was paid correctly. Also, I am due the performance bonus payment. Self-evaluation was to be submitted by
Jan 04th (I was still in employment), I submitted the form Dec 21st (if I am not mistaken, it was def Christmas week). Bonus is paid on March payroll in respect of performance for the year 2021 - Jan to Dec cycle. I worked through an injury, never missed a deadline, did not leave work behind by the time (contrary to my predecessor -long history of complaints to management regarding this subject). Company is refusing to pay me because according to them "Annual bonus is paid out in March payroll each year, and any colleague who gives notice before the March 25th payment date is not eligible to receive the bonus".
The complaint form is not a statutory form The key consideration relates to any prejudice and disadvantage that may arise to the Respondent concerning the inclusion of the complaints relating to holidays and bonus in the narrative of the form. It would not appear that a prejudice has arisen as the Respondent is on notice of these complaints and has not sought time to respond or reply to them. There has been no surprise regarding these matters.
I refer to the commentary on the relevant case law concerning amending the WRC complaint form in Employment Law 3rd Ed, Bloomsbury:
Amendment of complaint form
[28.11]
The circumstances in which the details on a complaint form can be amended were fully considered by the Labour Court in An Employer v A Worker. 28 In this case, the complainant alleged that she was discriminated against in the course of applying for a position with the respondent company. The company contended that she had not applied for a job but for a self-funded training programme. The Labour Court was satisfied that, if the interview following which she was not selected was not directed at access to employment within s 8(1)(a) of the Employment Equality Act 1998, it was ‘most undoubtedly directed at vocational training’ within the meaning of s 12(2). Having regard to the observations of McGovern J in County Louth VEC v Equality Tribunal 29 that the complaint form was only intended to set out in broad outline the nature of the complaint and that it was permissible to amend a claim set out therein ‘so long as the general nature of the complaint...remains the same’, the Court was satisfied that the complaint form could be legitimately amended to reflect the proper construction of the claim.
In Ballarat Clothing Ltd v Aziz, 30 the complainant (who was not legally trained or advised) incorrectly filled in the complaint form naming the individuals who were directors of the company, but not the company itself, as the employer. The Equality Tribunal dismissed the complaint under s 77A (1) of the 1998 Act as being ‘frivolous, vexatious or misconceived’. The complainant appealed to the Labour Court and the company submitted that the Court had no authority to substitute it for the two named directors.
The Court noted that the company acknowledged that it was aware from the commencement of the case that an error had been made and that it would suffer no prejudice were the appeal to be allowed. In these circumstances, the Court felt that, not to allow the appeal for such a technical reason would be a ‘grossly disproportionate response’.
In Department of Foreign Affairs v Cullen, 31 however, the Labour Court said that an amendment would not be allowed if its effect would be to permit the complainant to pursue a complaint that would otherwise be excluded by s 77(5) of the 1998 as being statute barred
I determine that the complaints are properly before me as the narrative detailing what the complaints were about were clearly set out in the narrative of the form and the Respondent suffers no prejudice.
Summary of Complainant’s Case:
The Complainant accepted that she had received the right notice and holiday pay. Some administrative errors had been made when her holiday pay was not properly calculated; however, these were rectified, and any monies owed have been paid other than the bonus. At the hearing, the core complaint related to her entitlement to an annual bonus that she believed she was entitled to, as she had been with the company for the relevant 12 months period that entitled her to payment. The payment was typically made in March or 3 months after the relevant year had ended and while she had left the company, it was unreasonable to withhold the bonus payment. She stated that others had received it and based on this practice and the merits of the case it was unreasonable for the employer not to pay her the bonus. |
Summary of Respondent’s Case:
The Complainant resigned on the 10th of December 2021 and her contract of employment ceased on the 7th of January 2022. The employee was not in employment on the bonus date in March 2022 which is an express contractual condition of the scheme. As she was not in their employment at the time, she was not eligible for the bonus. |
Findings and Conclusions:
Wages in the Payment of Wages Act 1991 is defined as: “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 The key issue before me is whether the amount being claimed was due. Section 5 of the Act states: 5.— (1) An employer shall not make a deduction from the wages of an employee (or receive any payment from an employee) unless— On the facts no deduction has taken place. Section 5 (6) states: (6) Where— (a) 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 (b) 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 dispute concerns a payment that maybe paid; not one that is properly payable as per the Act. This arises as the condition of payment is an express term of the contract that requires that the employee be in employment when the bonus is being paid. The complainant appeals to natural justice to support her claim. However, the redress sought under the Payment of Wages Act does not provide the adjudicator with such discretion. The company relies on the provisions of the scheme that states: “Colleagues must be actively employed by Aon (and must not have either given or received notification of their termination or resignation) and on the Aon payroll on the date of the payout (unless dictated otherwise by local laws and/or guidelines) to be eligible. Payout is generally as soon as administratively feasible following the close of the application of the Performance Year.” The Respondent was requested to consider Eamon Finnegan v J & E Davy [2007] IEHC and how it may inform the decision of this tribunal. A supplementary submission was provided to detail how case law has determined when a bonus earned may be paid if the employee is no longer an employee at the time of the bonus pay out. The company distinguishes Eamon Finnegan v J & E Davy [2007] IEHC from this complaint where it was held that the bonus should be paid to an employee who had resigned from the Respondent employer. That case was based on a legitimate expectation and where no express clause existed that made being in employment on the date of payment a condition of the bonus scheme. This case is different as there was a clear express clause that precluded payment. The case law to support this position and relied upon by the Respondent is Horkulak v Cantor Fitzgerald International [2005] ICR 402 and more recently Board Gais Energy v ThomasPWED 1729 where the Labour Court held that: “The Court places considerable weight on the fact that the Complainant’s contract sets out the eligibility requirement for payment” In Devlin v Electricity Supply Board PW 550/2011 the tribunal noted that: However, a discretion, although it may seem absolute, is not unfettered and must be exercised reasonably and in good faith Horkaluk v Cantor Fitzgerald [2004] 1 ICR 697 and Lichters & Hass v Depfa [2012] IEHC 10. Hedigan J in Lichters affirmed that a discretion is not unfettered: In Clarke v Nomura International [2000] IRLR 766 the Court of Appeal for England and Wales considering this type of situation observed: - "An employer exercising a discretion which on the face of the contract of employment is unfettered or absolute, will be in breach of contract if no reasonable employer would have exercised the discretion in that way." He went on to say that, 10 6.9 Whether in the context of a contract in restraint of trade if that is the case, or to determine the proper exercise by the defendant of its discretion as an employer, the question for the court is as to whether it can be considered that in the circumstances of this case no reasonable employer would have acted as the defendant company did In this case it cannot be said that no reasonable employer would have acted as the defendant company did and arising from the fact that the express term of the scheme required that the Respondent be in employment no unlawful deduction was made. A bonus payment can have several goals including retention. By delaying the payment and making it a condition of being in employment a choice to leave must be made with a consequence of forfeiting the bonus. While the employee may see it as unreasonable, the test is an objective one and, in this case, it can be argued persuasively that other employers would also apply a similar condition for sound business reasons. The complaint is not well founded. |
Decision:
Section 41 of the Workplace Relations Act 2015 requires that I make a decision in relation to the complaint(s) in accordance with the relevant redress provisions under Schedule 6 of that Act.
In this case it cannot be said that no reasonable employer would have acted as the defendant company did and arising from the fact that the express term of the scheme required that the Respondent be in employment and the Complainant was not; no unlawful deduction was made. I do not find that the bonus was unlawfully withheld. The complaint is not well founded. |
Dated: 18th October 2022
Workplace Relations Commission Adjudication Officer: Brian Dalton
Key Words:
Bonus |