Complainant

Respondent

Parties

Barbara  Remic

Suirsafe Technologies Limited

Representatives

  Self

No appearance by, or on behalf of, the Respondent

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-00057564-001

06/07/2023

Complaint seeking adjudication by the Workplace Relations Commission under Section 27 of the Organisation of Working Time Act, 1997

CA-00057564-002

06/07/2023

Complaint seeking adjudication by the Workplace Relations Commission under Section 8 of the Unfair Dismissals Act, 1977

CA-00057564-003

06/07/2023

The Complainant commenced her employment with the Respondent on 1 September 2021 as Head of Products and Marketing. Initially she was paid €15,000 gross per month. This was reduced by agreement in May 2022 to €7,500 gross a month.

The Complainant referred her first claim to the WRC on 3 October 2022 (ADJ-00042575). She referred further claims on 5 December 2022, 15 February 2023, 1 May 2023 (bearing reference number ADJ-00043760) and 6 July 2023 (bearing reference number ADJ-00046718). The complaints were heard together at the adjudication hearings held on 21 June 2023 and 30 August 2023.

The Complainant referred her claim CA-00057564-001 to the Director General of the WRC on 6 July 2023 pursuant to Section 6 of the Payment of Wages Act, 1991 alleging that the Respondent has not paid her or paid her less than the amount due to her.

At the adjudication hearing, the Complainant sought to have two additional claims introduced:

·       A claim of unfair dismissal pursuant to the Unfair Dismissals Act, 1977 and

·       A claim regarding outstanding annual leave entitlements under the Organisation of Working Time Act. 1997.

There was no attendance by, or on behalf of, the Respondent at the adjudication hearings and no submissions were furnished by the Respondent.

In considering the introduction of the new claim, I am guided by the High Court judgment in the case of County Louth Vocational Educational Committee v The Equality Tribunal and Pearse Brannigan [2009] IEHC 370 where it was held at paragraph 6.2;-

‘I accept the submission on behalf of the respondent that the Form EE1 was only intended to set out, in broad outline, the nature of the complaint. If it is permissible in court proceedings to amend pleadings, where the justice of the case requires it, then a fortiori, it should be permissible to amend a claim as set out in a form such as the EE1, so long as the general nature of the complaint (in this case, discrimination on the grounds of sexual orientation) remains the same.’ 

I note that McGovern, J. also stated in this judgment at paragraph 6.3 that this can only be done so long as "the respondent in the claim must be given a reasonable opportunity to deal with these complaints, and the fair procedures adopted by the Equality Officer must be fair and reasonable and in compliance with the principles of natural and constitutional justice."

I also note the dicta of MacMenamin J. in the Supreme Court in County Louth VEC v Equality Tribunal [2016] IESC 40:

‘It goes without saying, first, that the duty of the Equality Officer is both statutory, and, ultimately, delimited by constitutional considerations. As part of fair procedures, it is necessary that all parties be aware, in a timely way, of the case which they must meet. Consequently, it would be wrong, were a situation to evolve in this investigation, where one or other of the parties was under a misapprehension of precisely the range of legitimate inquiry. Second, it is hardly necessary to reiterate that it is not possible for any tribunal, upon which a particular jurisdiction has been conferred by statute, to extend or confine the boundaries of that jurisdiction by an erroneous determination of fact (see State (Attorney General) v. Durkan [1964] I.R. 279, approved in Killeen v. DPP [1998] ILRM 1). There may also be circumstances in which a tribunal, although holding jurisdiction to enter upon an investigation or inquiry, may render its decision a nullity by, for example, a denial of fair procedures.’

I further note that in his judgment in Clare County Council v Director of Equality Investigations [2011] IEHC 303 Hedigan J. stated at paragraph 6.5:- 

‘It is clear from the foregoing that because the EEI form is only designed to set out the generality of a complaint, complainants should be allowed to expand on matters not specified in the form. So long as respondents are not taken by surprise, or alternatively given adequate time to answer, there can be no injustice therein.’

I further note the dicta of Charleton J. in Galway-Mayo Institute of Technology v Employment Appeals Tribunal [2007] IEHC 210:

“It follows from the foregoing that a judicial or quasi-judicial tribunal is not entitled to invoke a statutory remedy which no one has sought and in respect of which no one is on notice. For the purpose of fulfilling the requirements of natural justice, however, I would have thought that if any such tribunal does have jurisdiction to give a remedy under a particular Act, then if this remedy is sought in an originating document, for instance by ticking a box giving a choice of remedies, or if it is orally sought to in the course of the hearing, such a tribunal is entitled to make a choice in favour of it. If that happens, parties have to be taken as being aware that in the event that a decision goes a particular way the tribunal may look to a remedy claimed. In that regard, I would regard a written claim or an oral assertion seeking a particular remedy as being sufficient for the due administration of constitutional justice provided the tribunal has jurisdiction in respect of it. If remedies are complex, and a tribunal has rules as to notice in the form of simple originating documents, then it should abide by its own procedures or consider the grant of an adjournment to a genuinely surprised party.”

Applying these dicta, I note that the WRC complaint form is not a statutory form. It is intended to set out the outline of a complaint or complaints, so that, and in line with fair procedures, the Respondent knows the issues it faces. In the present case, the new claim regarding unfair dismissal which the Complainant sought to introduce at the hearing was raised in the complaint form dated 6 July 2023 where the Complainant outlined that she had to resign her position due to not receiving her salary for twelve months. The matter of annual leave entitlements was outlined in all complaint forms (3 October 2022, 5 December 2022, 15 February 2022,1 May 2022 and 6 July 2023). The complaint forms were copied to the Respondent. I am thus satisfied that the Respondent was on notice of the claims.

I am satisfied, given all of the circumstances of the present case, that I do have jurisdiction to permit the introduction of the new claims and to investigate these complaints.

The Complainant submits that she was initially paid €15,000 gross per month. Her salary was subsequently reduced by agreement to €7,500 gross per month from May 2022. The Complainant exhibited a copy of her employment contract and a copy of the “Contract Adjustment”.

The Complainant submits that the Respondent did not pay her her salary from July 2022 to June 2023. She is therefore, owed her salary for April, May and June 2023.

She also alleged that she was owed her outstanding annual leave entitlements for 2022 which were due to her in June 2022.

There was no appearance by, or on behalf of, the Respondent. I am satisfied that the Respondent was properly on notice of the date, time and location of the hearing.

The Law

Section 5 of the Payment of Wages Act provides as follows:-

5. Regulation of certain deductions made and payments received by employers

(1) An employer shall not make a deduction from the wages of an employee (or receive any payment from an employee) 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.

In Marek Balans v Tesco Ireland Limited [2020] IEHC 55 MacGrath J considered Section 5 of the Act as follows:

36. The provisions of s. 5(6) of the Act of 1991 were considered by Finnegan P. in Dunnes Stores (Cornelscourt) Limited v. Lacey [2007] 1 I.R. 478. A Rights Commissioner had found in favour of the respondents holding that the cessation of service pay amounted to an unlawful deduction, which was upheld by the EAT. It was argued that the EAT should address the question of remuneration properly payable to an employee before considering the question of a deduction or whether a deduction was unlawful. Finnegan P. concluded at p. 482:-

“I am satisfied upon careful perusal of the documents relied upon by the respondents that the same cannot represent the agreement or an acknowledgement of the agreement contended for but rather contain a clear denial of the existence of any such agreement. No other evidence of an agreement was proffered. In these circumstances I am satisfied that the Employment Appeals Tribunal erred in law in failing to address the question of the remuneration properly payable to the respondents, such a determination being essential to the making by it of a determination. Insofar as a finding is implicit in the determination of the Employment Appeals Tribunal that the appellant agreed to pay to the respondents service pay and a long service increment, then such finding was made without evidence and indeed in the face of the evidence: I am satisfied that there has been no deduction of pay from the respondents within the terms of the Act of 1991 but rather their remuneration has been unilaterally increased by the appellant making a payment which recognises their long service in excess of that which was payable prior to the 18th September, 2002. In either case there has been an error or law. Accordingly I allow the appeal.”

The High Court made it clear that, when considering a complaint under the Act, an Adjudication Officer must first establish the wages which were properly payable to the employee before considering whether a deduction had been made. If it is established that a deduction within the meaning of the Act had been made, the Adjudication Officer would then consider whether that deduction was lawful.

It is for the Complainant to make out that the wages payable to her during the period encompassed by the claim are properly payable to her under the Act.

The Labour Court in Hannigans Butchers Limited v Jerko Anders Hresik Bernak DWT 194 held as follows;-

“This Court in Melbury Developments Ltd v. Arturs Valpeters EDA0917, in a case under the Employment Equality Acts, put it clearly in stating, ‘Mere speculation or assertions, unsupported by evidence, cannot be elevated to a factual basis upon which an inference of discrimination can be drawn’ and that ‘The Complainant must first establish facts from which discrimination may be inferred’. While these observations of the Court reference specific requirements under the relevant legislation, the sentiments are equally applicable to the exercise of rights under other Acts covering employment law. Indeed, it is a well-established general rule of evidence to quote Palles CB in Mahony v. Waterford, Limerick and Western Railway Co., (1900)2 IR 273,that ‘…it is a general rule of law that it lies upon the plaintiff to prove affirmatively all the facts entitling him to relief…’

In the present case, the Complainant alleges that the Respondent has not paid her her salary for the months of July to December of 2022, and January to June 202. She also alleged that the Respondent owed her the payment in respect of outstanding annual leave entitlements.

The Complainant referred to her contract of employment dated 14 August 2021 and a document titled “Contract Adjustment” which confirmed that her monthly salary as of May 2022 was €7,500 gross.

The Complainant also exhibited a copy of an email exchange with the Respondent where the matter of non-payment of wages was discussed. I note that in one of the emails, Mr Sheldon Li, on behalf of the Respondent, admits that “It is not fair” to ask the Complainant to work for the Respondent “without receiving salaries”. In another email Mr Li states that the Respondent had no budget for the Complainant’s salary.

The matter of the non-payment of wages for the months July, August and September 2022 has been dealt with in ADJ-00042575 and is, therefore, disposed of. The matter of the non-payment of wages for the months from October 2022 to March 2023 was dealt with in ADJ-43760 and is, therefore, disposed of.

Based on the uncontested evidence of the Complainant, I find that the Respondent has not paid the Complainant her wages for the months of April, May and June of 2023.

I declare this complaint to be well founded. I direct the Respondent to pay the Complainant the sum of €22,500 in respect of her wages for the months of April, May and June of 2023.

The Complainant submits that she did not receive her annual leave entitlement for 2022 (from January 2022) and 2023.

The Respondent did not attend the adjudication hearing.  I am satisfied that the Respondent was properly on notice of the date, time and location of the hearing.

The Law

The Organisation of Working Time Act, 1997 stipulates as follows;-

19. Entitlement to annual leave

(1) Subject to the First Schedule (which contains transitional provisions in respect of the leave years 1996 to 1998), an employee shall be entitled to paid annual leave (in this Act referred to as “annual leave”) equal to—

(a) 4 working weeks in a leave year in which he or she works at least 1,365 hours (unless it is a leave year in which he or she changes employment),

(b) one-third of a working week for each month in the leave year in which he or she works at least 117 hours, or

(c) 8 per cent of the hours he or she works in a leave year (but subject to a maximum of 4 working weeks):

Provided that if more than one of the preceding paragraphs is applicable in the case concerned and the period of annual leave of the employee, determined in accordance with each of those paragraphs, is not identical, the annual leave to which the employee shall be entitled shall be equal to whichever of those periods is the greater.

23. Compensation on cesser of employment

(1)

(a) Where—

(i) an employee ceases to be employed, and

(ii) the whole or any portion of the annual leave in respect of the relevant period remains to be granted to the employee,

the employee, shall as compensation for the loss of that annual leave, be paid by his or her employer an amount equal to the pay, calculated at the normal weekly rate or, as the case may be, at a rate proportionate to the normal weekly rate, that he or he would have received had he or she been granted that annual leave.

The Complainant alleged that she did not receive her annual leave entitlements accrued during the period from January 2022 that has been carried over and any annual leave that was accrued to the termination date.

On the basis of the uncontested evidence of the Complainant, I find that she is entitled to compensation in respect of the annual leave she accrued in the period from January 2022 to 4 July 2023.

I declare this complaint to be well founded. I direct the Respondent to pay the Complainant compensation of €10,384 which is approx. 6 weeks leave. In addition, I direct the Respondent to pay the Complainant €3,000 in compensation for the breach of the Act.

The Complainant submits that the Respondent has not paid her her salary since July 2022.

The Complainant submits that she, together with her colleague who has referred a separate claim against the Respondent, emailed the Respondent on numerous occasions inquiring about the outstanding monies.

The Complainant clarified that, after resigning her position with the Respondent on 4 July 2023, she registered with Employment Service in her native country as an active job seeker. She received the decision of the Employment Service on 16 August 2023 to receive unemployment support for 6 months. In this period she has to find a job that suit her qualifications. The Complainant confirmed that one of the requirements of the service was to actively look for a new employment and report on her efforts.

The Complainant clarified by email dated 2 September 2023 that as of that date, there were no job positions which would suit her qualifications so she had not sent any job applications.

The Respondent did not attend the adjudication hearing.  I am satisfied that the Respondent was properly on notice of the date, time and location of the hearing.

Section 1 of the Unfair Dismissals Act provides the following definition of “dismissal”:

“dismissal”, in relation to an employee, means—

“(a) the termination by his employer of the employee’s contract of employment with the employer, whether prior notice of the termination was or was not given to the employee,

(b) the termination by the employee of his contract of employment with his employer, whether prior notice of the termination was or was not given to the employer, in circumstances in which, because of the conduct of the employer, the employee was or would have been entitled, or it was or would have been reasonable for the employee, to terminate the contract of employment without giving prior notice of the termination to the employer.”

The term “constructive” dismissal is not specifically provided for in the Unfair Dismissals Act 1977. However, it is a term commonly understood to refer to that part of the definition Section 1(b) of the Act (as quoted above).

As the Complainant is claiming constructive dismissal, the onus of proof rests with the Complainant to establish facts to prove that the actions of the Respondent were such to justify terminating her employment.

The legal test in respect of constructive dismissal was provided by the UK Court of Appeal in the case of Western Excavating (ECC) Ltd -v- Sharp [1978] IRLR 332.  It comprises of two tests, referred to as the “contract” and the “reasonableness” tests. It summarised the “contract test” as follows:

“If the employer is guilty of conduct which is a significant breach going to the root of the contract of employment, or which shows that the employer no longer intends to be bound by one or more of the essential terms of the contract, then the employee is entitled to treat himself as discharged from any other performance.” 

The “reasonableness test” assesses the conduct of the employer and whether it “…conducts himself or his affairs so unreasonably that the employee cannot fairly be expected to put up with it any longer, [if so] the employee is justified in leaving.”

In both situations, the conduct must be of sufficient gravity so as to entitle the employee to terminate the contract without notice or render it reasonable for him or her to do so. Therefore, the question which I must decide in the present case whether, because of the conduct of the Respondent, the Complainant was entitled, or it was reasonable for her, to terminate the contract of employment. It is well settled law in the area of constructive dismissal that an employee who terminates their own employment because of the unreasonable conduct of the employer may only succeed in a constructive dismissal action where they show that they themselves acted reasonably by seeking, prior to termination, to bring complaints to the attention of the employer with a view to resolving the issues.

In Berber v Dunnes Stores [2009] 20 ELR, the Supreme Court held that;-

“There is implied in a contract of employment a mutual obligation that the employer and the employee will not without reasonable and proper cause conduct themselves in a manner likely to destroy or seriously damage the relationship of confidence and trust between them. The term is implied by law and is incident to all contracts of employment unless expressly excluded. The term imposes reciprocal duties on the employer and the employee. In assessing whether there has been a breach by the employer what is significant is the impact of the employer’s behaviour on the employee rather than what the employer intended. Having regard to the mutuality of the obligation the impact of an employee’s behaviour is also relevant. The test is an objective one: if conduct objectively considered is likely to cause serious damage to the relationship between employer and employee a breach of the implied obligation may arise.’”

Finnegan J. further described the test in the following terms regarding whether an employer’s actions breached the term of trust and confidence:

“1. The test is objective

2. The test requires that the conduct of both employer and employee be considered.

3. The conduct of the parties as a whole and the accumulative effect must be looked at.

4. The conduct of the employer complained of must be unreasonable and without proper cause and its effect on the employee must be judged objectively, reasonably and sensibly in order to determine if it is such that the employee cannot be expected to put up with it.”

In the present case, the Complainant has alleged that that she resigned her position on 4 July 2023 due to the fact that the Respondent failed to pay her wages due to her for the period from July 2022 to the date of her resignation.

In considering this issue, I am satisfied that the Respondent had no established grievance procedure in place. I am satisfied that, in the absence of a grievance policy or procedure, the Complainant had used the only method available to her to resolve her grievance and both herself and her colleague engaged in an extensive exchange of emails with the Respondent.

Addressing a situation where an employer had ceased to pay an employee, the Employment Appeals Tribunal held as follows in Kilkerr v Burke Fabrications Ltd UD470/2013:

“When an employee provides labour and services to an employer it is reasonable for the employee to expect to be paid for its labour and or services. In the present case the Respondent, over a long period of time, made part payment of wages to the Claimant and furthermore requested that the Claimant return to his workplace, on a promise that wages due and owing would be sorted out. The Claimant did not return to work as the mutual trust, which is an essential component of the contract of employment, was breached so many times by the Respondent’s promise to pay his wages and then failing or refusing to do so. False promises, delayed and inconsistent part payments from the employer do not dilute the breach of trust between the employee and employer."

In circumstances where the Complainant had not been paid her salary at all for some twelve months, it is clear that she was entitled to regard the behaviour of the Respondent as repudiatory of her contract of employment in respect of the non-payment of wages.

For the reasons set out above I find the Complainant has established that in all the circumstances it was reasonable for her to terminate her contract of employment.  As the Complainant’s termination of her contract of employment was, in all the circumstances, reasonable I find that the Complainant was unfairly dismissed.

It follows that the Complainant is entitled to redress under the Act. The Complainant sought compensation. I am satisfied that the behaviour of the Respondent company was such that trust and confidence had broken down completely and, therefore, compensation is the appropriate form of redress in the within case.

In assessing the level of compensation to be awarded I note that the Complainant resigned her position on 4 July 2023. At the adjudication hearing on 30 August 2023, it was confirmed that she was paid €1,730.77 gross weekly by the Respondent. The Complainant’s evidence was that she registered with the Employment Service in her native country and, as of 16 August 2023, she was in receipt of state support. The Complainant clarified by email dated 2 September 2023 that as of that date, she had not applied for any jobs.

The requirement on a dismissed employee to seek alternative employment is very significant. The Employment Appeals Tribunal in Sheehan v. Continental Administration Company Ltd. UD858/ 1999noted that:- 

“The time that a claimant finds on his hands is not his own, unless he chooses it to be, but rather to be profitably employed in seeking to mitigate his loss.”

In arriving at my decision as to the amount of compensation that is just and equitable, I have considered the Complainant’s insufficient attempts to mitigate her loss.

I declare this complaint to be well founded. I direct the Respondent to pay the Complainant €6,923 (six thousand nine hundred and twenty-three)(equivalent of approx. 4 weeks’ pay) in compensation.

Non-payment of wages – annual leave – unfair dismissal