Complainant

Respondent

Parties

Brendan  Dowling

Carlow County Council

Representatives

Ger Malone SIPTU

Keith Irvine LGMA

Act

Complaint/Dispute Reference No.

Date of Receipt

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

CA-00046249-001

15/09/2021

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

CA-00046249-002

15/09/2021

This matter was heard by way of remote hearing pursuant to the Civil Law and Criminal Law (Miscellaneous Provisions) Act, 2020 and S.I. No. 359/2020 which designates the WRC as a body empowered to hold remote hearings.

The complainant took the affirmation at the start of the hearing, however there was no disagreement between the parties as to the facts of this case. Both parties relied upon their written submissions.  They also made reference to, and indicated that I should take account of, a decision of the Labour Court that they were both awaiting at the date of the hearing, indicating that it dealt with the same set of facts and revolved around the same set of principles, although in the name of a different named complainant.

The finalisation of this decision was delayed due to the impact of Covid 19.

The complainant submitted that the case before the WRC is for the inclusion of regular and rostered overtime and allowances in the calculation or annual leave and Public Holiday pay.

The complainant submitted that he is relying upon the decision of the Court of Justice of the European Union (‘the CJEU’) in Lock v British Gas Trading Limited (2014) ICR 813 in support of his submission that overtime payments and allowances are reckonable for the purposes of calculating annual leave pay.

In addition, the complainant submitted that having regard to the decision of the Court of Appeal in Northern Ireland in Chief Constable of the Police Service of Northern Ireland & Anor v Agnew (2019) NICA 32 (‘Agnew’) and the judgment of the CJEU in King v Sash Window Workshop Limited (Case C-214/16) (‘Sash Windows’), he is entitled to seek retrospection of any underpayments in respect of annual leave retrospective to the date his employment with the Respondent commenced in December 1996.

The respondent submitted that it complies fully with sections 19 and 20 of the Organisation of Working Time Act 1997 and with the provisions of the Organisation of Working Time (Determination of Pay for Holidays) Regulations 1997.

The respondent submitted that it has gone above and beyond its statutory obligations in so far as it has entered into an agreement with the complainant’s Trade Union to include regular and rostered overtime in the calculation of employees’ holiday pay.

The respondent submitted that none of the authorities cited by the complainant support the retrospective element of his claim.  The respondent noted that from its perspective, Agnew is primarily concerned with the application of time limits as provided for in the relevant Regulations in place in Northern Ireland and is, in any event, under appeal to the UK Supreme Court.

The respondent also submitted that the decision in the Sash Windows case is distinguishable on the facts from the within case as the Plaintiff in that case had been denied any opportunity to avail himself of paid annual leave throughout his period of employment because he had been wrongly characterised as an independent contractor and commenced his litigation to seek payment in lieu of untaken annual leave on the cessation of his employment

Both parties indicated that they were awaiting on the decision in the case of ADJ 32324 Coughlin v Carlow Co. Co. and that the present case was on ‘all fours’ with that complaint and appeal in terms of the facts of the cases.  They indicated that they had comprehensively presented their arguments to the Labour Court and urged the Adjudication Officer to take this appeal into account when it is published.

The Labour Court considered that case and issued its decision Carlow v Carlow Co. Co. (DWT2228) on 12 July 2022.  Having considered the decision, I am in agreement with the parties when they say that the matters revolve around the same set of facts and that it sits on ‘all fours’ with the instant case.  In that case, the Labour Court considered matters and I consider it instructive to include their deliberations at length here:

Statutory Time Limit

As stated previously, the Complainant referred his complaint under the Act to the Workplace Relations Commission on 8 March 2021. As his claim relates to the calculation of payment for annual leave (as opposed to the granting of annual leave), in the Court’s judgment, the cognisable period covered by the claim – having regard to section 41(6) of the Workplace Relations Act 2015 - is the period 9 September 2020 to 8 March 2021. It is also the Court’s judgment that none of the cases cited by the Complainant are authority for the Court assuming, on the facts of the within appeal, an enlarged temporal jurisdiction over and above that specified by the Oireachtas.

For the avoidance of doubt, the Court fully accepts the Respondent’s submission that the judgments in Sash Windows and in Agnew, respectively, for the reasons stated, do not support the Complainant’s submission that this Court – were it to uphold the substance of his claim that overtime payment should be included in the calculation of payment for annual leave – can award redress retrospective to the date of commencement of his employment in 1999.

Within the cognisable period, the Complainant availed himself of, and was paid for, annual leave as follows: 9 October 2020 – 8 hours; 23 October 2020 – 8 hours; 6 November 2020 – 16 hours; 20 November 2020 – 8 hours; 15 January 2021 – 32 hours. His pay in respect of this annual leave was calculated in accordance with his basic rate of pay.

The Court’s Jurisdiction Confined to Statutory Annual Leave

The within appeal is before the Court under the Organisation of Working Time Act 1997. The Act provides, inter alia, for an entitlement to a minimum period of annual paid leave, calculated in accordance with section 19 of the Act. The Complainant’s statutory annual leave entitlement is twenty days. He has a further contractual entitlement to five days’ leave annually. In dealing with a claim brought under the Act, the Court has no jurisdiction per se with regard to a complainant’s extra-statutory leave.

Calculation of Payment for Statutory Annual Leave

The Organisation of Working Time Act 1997 was enacted to give effect to Directive 93/104/EC of 23 November 1993 of the Council of the European Communities which delegated to the Member States of the European Union the right to determine all aspects of holiday pay, including its calculation. The Directive left it to national legislation to determine the conditions of entitlement to, and granting of, an employee’s paid annual leave, including the determination of the basis upon which payment is calculated for such periods of leave and the level of such payment.

Section 19(1) of the Act provides for the calculation of statutory annual leave as follows:

“(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.”

Section 20(2) makes provision in general terms for the basis on which payment for statutory annual leave is to be calculated and subsection (4) of that section enables the Minister to promulgate regulations for the purpose of determining the manner in which “normal weekly rate [of pay]” is to be determined:

“(2) The pay in respect of an employee's annual leave shall—

(a) be paid to the employee in advance of his or her taking the leave,

(b) be at the normal weekly rate or, as the case may be, at a rate which is proportionate to the normal weekly rate, and

(c) in a case in which board or lodging or, as the case may be, both board and lodging constitute part of the employee's remuneration, include compensation, calculated at the prescribed rate, for any such board or lodging as will not be received by the employee whilst on annual leave.

(3) ….

(4) In this section “normal weekly rate” means the normal weekly rate of the employee concerned's pay determined in accordance with regulations made by the Minister for the purposes of this section.”

The Organisation of Working Time (Determination of Pay for Holidays) Regulations 1997 SI No 475 of 1997 (‘the Regulations’) address these matters. Regulation 3(2) expressly and unambiguously excludes overtime from the calculation of annual leave pay. It provides:

“(2) If the employee concerned's pay is calculated wholly by reference to a time rate or a fixed rate or salary or any other rate that does not vary in relation to the work done by him or her, the normal weekly rate of his or her pay, for the purposes of the relevant sections, shall be the sum (including any regular bonus or allowance the amount of which does not vary in relation to the work done by the employee but excluding any pay for overtime) that is paid in respect of the normal weekly working hours last worked by the employee before the annual leave (or the portion thereof concerned) commences or, as the case may be, the cesser of employment occurs.”

This Court has addressed the issue of the non-inclusion of overtime in the calculation of annual leave having regard to Regulation 3(2) of SI 475 of 1997. See, for example, the Court’s Determination in MCM Security Limited v Tom PowerDWT0895 where the Court stated:

“It is clear from the wording of both Regulation 3(2) and Regulation 5(1) that payment in respect of overtime is not reckonable in the calculation of pay for either annual leave and public holidays.

The Union accepts that the Claimant’s normal pay is made up of 39 hours pay at the standard rate prescribed by the ERO for the sector and six hours overtime pay at the premium rate. It is clear that this overtime element is not reckonable in applying the formula prescribed by Regulation 3(2). It follows that the Claimant’s claim for the inclusion of this overtime in the calculation of the rate at which he is paid for annual leave cannot succeed in the present proceedings.”

Allowances Received by the Complainant

The Complainant is in receipt of two allowances which he submits ought to be reckonable for the purposes of calculating payment for annual leave: a non-taxable eating on-site allowance of €9.50 per week and an on-call allowance of €80.62 per week for each of the six weeks per year for which is required to be on-call. In the Court’s judgment, neither of these two allowances is comprehended by Regulation 3(2).

The eating on-site allowance is not treated as pay for taxation purposes. The on-call allowance does vary in so far as it is only payable when the Complainant is actually available for on-call duty outside core hours on six pre-determined weeks in any year.

Conclusion

For the reasons set out in the body of this Determination, the Complainant’s claim for retrospective payment of alleged underpayment of annual leave back to the date of commencement of employment fails. The Court’s judgment is that its jurisdiction is limited temporally to the cognisable period referred to earlier and is confined also to considering the calculation of payment for statutory annual leave only.

It is also the Court’s judgment that the Respondent has properly calculated the Complainant’s pay in respect of the statutory annual leave he availed himself of during the cognisable period comprehended by the claim having done so in accordance with SI 475 of 1997. The claim that the calculation of the Complainant’s annual leave for the purposes of the Act should include regular and rostered overtime and an amount in respect of the allowances he is in receipt of, has not been made out.

In relation to the jurisdiction in relation to Annual Leave, I am persuaded by the Labour Court’s reasoning and similarly conclude that the cognisable period is 16 March 2021 to 15 September 2021.  I am also persuaded by the Court’s conclusion that there is no jurisdiction per se with regard to the complainant’s extra-statutory leave.

Having regard to all the written submissions made in relation to this complaint, I am satisfied that no reasonable argument has been made out as to why I should differ from the Labour Court decision made under identical facts.

CA-00046249-001

As indicated by the parties in the oral submissions at hearing, I have followed the decision taken by the Labour Court’s in Coughlan and Carlow County Council, and accordingly I find that the complainant’s claim that his regular and rostered overtime and his allowances should be included in his holiday pay is not in accordance with the provisions of Regulation 3(2) of SI 475/1997. Accordingly, I find that this complaint is not well founded.

CA-00046249-002

Regulation 5 of SI 475/1997 addresses the calculation of pay for public holidays:

(1)   If the employee concerned works or is normally required to work during any part of the day which is a public holiday, then—

(a) in case the employee's pay is calculated wholly by reference to any of the matters referred to in Regulation 3(2) of these Regulations, the relevant rate in respect of that public holiday shall be the sum that is equal to the sum (including any regular bonus or allowance the amount of which does not vary in relation to the work done by the employee but excluding any pay for overtime) paid to the employee in respect of the normal Daily hours last worked by him or her before that public holiday[.]

Sub-section (b) has no relevance to the case under consideration here.

The findings in MCM Security are relevant with regard to the complainant’s claim that his pay for public holidays should be based on his “normal weekly pay” as the Court found that overtime is not reckonable in the calculation of pay for public holidays.

Having regard to the Labour Court findings in Coughlan (above), I find that the eating on site allowance and the on-call allowance are also not reckonable in the calculation of public holiday pay.  Accordingly, I find that this complaint is not well founded.

CA-00046249-001

Having regard to all the written and oral submissions made in relation to this complaint, my decision is that this complaint is not well founded.

CA-00046249-002

Having regard to all the written and oral submissions made in relation to this complaint, my decision is that this complaint is not well founded.

Organisation of Working Time Act – not well founded