Worker

Employer

Anonymised Parties

A Teacher

A University

Act

Dispute Reference No.

Date of Receipt

Complaint seeking adjudication by the Workplace Relations Commission under section 13 of the Industrial Relations Act, 1969

IR - SC - 00000916

06/12/2022

The dispute before comes by way of a claim under Section 13(9) of the Industrial Relations Act, 1969.

The complainant is a university teacher, and her employer is a University. Her dispute is that she did not receive her full entitlement to a redundancy payment as was agreed with the respondent.

She commenced employment in September 1995, and in 2011/2012, the complainant and colleagues referred several claims to the Labour Court and the Employment Appeals Tribunal.  In February 2013, following further litigation the parties settled the claims.

The settlement agreement contained a clause that in the event of an exit from the University, the employer would pay the complainant a package of "5 week's pay per year of service” and that the payment would not be capped.

In February 2021, the Human Resources department approached the complainant to discuss the possibility of her accepting a redundancy package. Prior to this, the complainant had not considered this and assumed she would retire in the normal way in 2028.

Subsequently, matters progressed vis-à- vis the severance, culminating in offer which comprised two options; The options provided were: Statutory Plus 2 Weeks €31,825.53 or Statutory Plus 3 Weeks totaling €39,706.43, respectively. The correspondence went on to ask explicitly if the complainant wished to proceed with the three-week option (€39,706.43).

Two options were presented to the complainant, one offering €31,825.53 for accepting the statutory entitlement plus two weeks' pay and the other offering €39,706.42 for accepting the statutory entitlement plus three weeks' pay. On October 6th, 2021, her union responded confirming acceptance of the three-week option (€39,706.42).

Despite numerous delays and communications in late September 2022, the complainant received a final payment of €31,511.50, which falls short of the clearly understood and agreed-upon amount between the parties by some €8,154.93. In actual fact, the figure did not amount to either the Statutory Plus two weeks offer of (€31,825.53) or the Statutory Plus three Weeks offer totaling (€39,706.43).

The underpayment was processed without any accompanying explanation and shortly thereafter, the complainant contacted her employer vis-à-vis the shortfall in the final payment.

On December 1st, 2022, some 14 months after accepting the offer (€39,706.43), as above, the respondent wrote to the complainant explaining 'the background to the payment'.

It is clear that at all times, the complainant was offered and accepted the proposition of a package of Statutory Plus three Weeks totaling €39,706.43 as was provided for by the High Court settlement dated February 28th, 2013.

At no point prior to the complainant confirming her preferred option or indeed until after the point of processing the payment was there any mention of the imposition of a cap of two years' salary. course" conclusion that the Claimant is entitled to the total amount of €39,706.43.

The complainant requests a recommendation affirming her case to be well-founded and rectifying the discrepancy between the redundancy payment received and the figure agreed upon between the Employee Relations Manager and our member, €8154.93.

The University is satisfied that the complainant was paid the correct amount of redundancy, in full, and in line with the relevant collective agreements and DFHERIS approval. Therefore, the University believes that her complaint should be dismissed.

The complainant opted for a redundancy arrangement with the University and ceased employment with the University on the September 30th, 2021. She was paid statutory redundancy based on the ceiling of €600 per week of service. A statutory redundancy payment of €16,062.91 was paid to her on January 28th, 2022.

An ex-gratia payment of €15,448.59 was paid on September 28th, 2022.

In accordance with arrangements in the public service, employees have two options for an additional ex-gratia payment. They have the option of 2 weeks’ pay per year of service, or the option of 3 weeks’ pay per year of service, subject to approval by DFHERIS.

Clause 15 of Circular 09/2018 ‘Consolidation of arrangements for the offer of severance terms in the civil and public service’, states the following:

“15. Discretionary severance payments should be calculated in accordance with the terms set out in the Collective Agreement on Redundancy Payments to Public Servants reached between this Department and the Public Service Committee of the ICTU and attached to this Department’s letter to Personnel Officers dated 28 June 2012 (Ref No: E150/07/12). In particular, any ex-gratia payment to a public servant employed for a period not less than 2 years, shall amount to no more than 3 weeks’ pay per year of service, subject to the total statutory redundancy and ex gratia payment not exceeding either 2 years’ pay or one half of the salary payable to preserved pension age, whichever is less.”

Ex-gratia options are subject to the terms of the Collective Agreement on Redundancy Payments to Public Servants (and are also subject to the approval of DFHERIS. 

The ex-gratia amount for the 2-week option was an additional €15,761.79 and the three-week option was an additional €23,642.69. These figures were subsequently confirmed by the University’s Finance Department. The ex-gratia options are gross amounts, and the usual terms of the Collective Agreements were to apply to the options and subject to the approval of DFHERIS. This was communicated to the complainant on September 28th, 2021.

The respondent again confirmed that the ex-gratia payment was subject to approval from DFHERIS before payment, in an email the union on October 8th, 2021.

The respondent told the complainant‘s union, by email on December 13th, 2021, that DFHERIS was experiencing a backlog in processing sanctions to pay redundancy payments and that the University would process the payment once approval was received from DFHERIS.

It is clear from the correspondence that the complainant was made aware, on numerous occasions, that an ex-gratia payment was subject to the terms of the Collective Agreements and subject to approval from DFHERIS.

The total (statutory + ex-gratia) for option 1 was €31,825.53, and for option 2 was €39,706.43. The University did seek approval from DFHERIS on October 14th, 2021, however, DFHERIS wrote back to the University on December 8th, 2021, to advise that the payment of the statutory and the ex-gratia payment could not exceed the cap of two year’s salary or one half of the salary payable to the preserved pension age, whichever is the less.

As both options 1 and 2 exceeded the cap (€31,511.50), the University wrote to DFHERIS on the February 10th, 2022, seeking approval to pay a revised option 1, i.e., €31,511.50. The University did not seek approval for option 2, as this amount was higher than the cap.

The Department subsequently approved the ex-gratia payment on September 7th, 2022.

The respondent wrote back to the complainant on December 1st, 2022, setting out the background to the approval and payment of her redundancy payment.  Based on the information received from DFHERIS, and the approval that was granted by DFHERIS, the University paid the complainant the appropriate statutory and ex-gratia payment.

The University believes that it has discharged the statutory and ex-gratia payment in the complainant ’s case, subject to the terms set out in the Collective Agreement on Redundancy Payments to Public Servants and in line with DFHERIS approval.

For the reasons outlined above, the complainant ’s claim should be rejected.

In conducting my investigation, I have taken into account all relevant submissions presented to me by the parties.

The facts are set out above and the difference between the parties is clear enough.

The respondent as a public service employer operates within a regime where approval and sanction for various issues related to pay and conditions of employment is required from its ‘parent department’ of State.

It set out above the terms of the relevant Circular Letter; the mechanism by which these matters are ordered. It is quite clear.

Equally clear are the terms of the High Court settlement of 2013 which were submitted for the hearing.

The relevant section reads as follows.

The appellant is willing to agree severance arrangements for those of the respondents who wish to exit the University. The severance arrangement if accepted would be based on the agreed sum in paragraph 6 and a package of five weeks’ pay per year of service (on the basis of average annual earnings of each respondent since 2006). The appellant is willing to make this time available on the basis that all the remaining respondent claims are resolved on the basis of the within terms.

These terms of settlement were agreed on February 28th, 2013, and are signed on behalf of the respondent by the Bursar of the university, its most senior financial officer, and by the complainant in this case (among others).

I can find no basis to undermine the binding validity of this agreement.

By any view of it, an agreement made as part of a settlement in the High Court and recorded with an official High Court reference must be accorded the highest possible deference, and, with all due respect to it, greater deference than a general circular letter which followed some five years later.

It is, of course specific to the complainant (or any other party to the settlement) and does not affect the general application of the Circular.

Accordingly, I uphold the complaint on these significant merits and recommend the payment to the complainant of the difference between the payment made and that sought by the complainant some €8,154.93.

Validity of agreement.