ADJUDICATION OFFICER DECISION

Adjudication Reference:  ADJ-00040726

Parties:

Complaints:

Date of Adjudication Hearing:  26/04/2023

Workplace Relations Commission Adjudication Officer:  Gaye Cunningham

Procedure:

In accordance with Section 41 of the Workplace Relations Act, 2015 and Section 6 of the Payment ofWages Act 1991,fand Section 77 of the Employment Equality Act 1998, 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.

The complaint under the Employment Equality Act 1998 was withdrawn at the hearing.

Background:

The complaint is that the Respondent failed to pay the Complainant wages properly payable to her from 5th June 2020 when she became eligible for appointment to the highest point on the AP Higher pay scale.  Following the Complainant’s early retirement in January 2022, she was notified of retrospective pay increments and a further potential pay increment which would have resulted in an improvement in lump sum and annual pension.

Summary of Complainant’s Case:

The Complainant is a retired civil servant.  At the time of her early retirement, she believed she was at the top of her scale and could achieve no further pay increases.  She subsequently learned she was entitled to an increment backdated to 2020,  which was withheld due to her sick leave record. 

The Complainant took early retirement on 3rd January 2022.  At the time she was working at the level of Assistant Principal and was assessed for pension entitlements on the basis of her final salary.  The Complainant was notified for the first time by her employer that she had not received a pay increment to the AP Higher Scales to which she had been entitled.  The pay increment should have taken effect on 5th June 2020, approximately 18 months before she opted to take early retirement. 

She submitted her Payment of Wages complaint at the time as the Respondent was refusing to pay her the additional increment which fell due on 5th June 2020 on the basis that it claimed she had in excess of 56 days sick leave prior in the four-year period prior to 5th June 2020, the increment’s operative date.  While it is the case that following extensive correspondence, which included the submission of medical records, the Respondent has confirmed that the issue of sick leave no longer applies to the Complainant and the 5th June 2020 increment will be applied retrospectively, it is submitted that this does not address sufficiently the significant loss experienced by the Complainant as a result of the failure of the Respondent to award her the increment at the time it fell due.

At the time she opted for early retirement the Complainant believed that she was at the top of her pay scale and therefore taking early retirement when she did would not impact her pension entitlement.  However, in correspondence that she received from the Respondent on 8th December 2022 she was informed for the first time that she would be entitled to a further increment on 15th November 2023.  It is the Complainant’s position that had she been aware of this entitlement, she would not have taken early retirement when she did, as this additional increment would have resulted in a significant improvement on her annual pension and lump sum entitlement.   

Following her retirement on 3rd January 2022, there was an exchange of correspondence between the Complainant and Respondent in which it emerged that her file had initially been misplaced by her Department and then it was confirmed that it was transferred from her previous department.        The correspondence further dealt with the matter of the Higher scale appointment and she was eventually awarded the point on the higher scale on 8th December 2022, retrospectively.

However, crucially she was advised at the time that the next increment would be due on 15/11/2023, however her last day of service was 03/01/2022. 

The relevant pay rates for AP and AP Higher scales were submitted in evidence.  As a result of not receiving the increment which she was due on 5 June 2020 the Complainant experienced a loss of salary up to 3rd January 2022, her date of early retirement, of €4,226.15.  However, of greater significance is the fact that the failure to award and notify the Complainant of her entitlement to a higher pay scale in June 2020, meant that she elected to opt for early retirement on the false premise that she had exhausted her income entitlements.  Crucially she was not aware that had she remained with the Department for a further 22 months, her income would have increased significantly, with a consequent increase in her pension and lump sum entitlements.  For example, had she stayed in work until 16 November 2023 she could have retired with a pension and lump sum based on €95,871.83 instead of €85,375. Further increases in line with pay increases awarded to people still working at her grade would have increased the annual pension accordingly.

The Law

Under Section 1 (1) of the Payment of Wages Act 1991:

“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
• (b) any sum payable to the employee upon the termination by the employer of his contract of employment without his having given to the employee the appropriate prior notice of the termination, being a sum paid in lieu of the giving of such notice:

Section 5 (1) states

Case law was cited to support the Complainant’s arguments regarding “wages properly payable”, Marek Balans v Tesco Ireland Limited [2020] IEHC 55.

Summary of Respondent’s Case:

The Complainant made two complaints on 22 July 2022.  One related to alleged discrimination under section 77 of the Employment Equality Act, 1988. It is apparent from the submissions of the Complainant, which do not mention the Employment Equality Act, that this claim is not being proceeded with. It is noted in the submission of the Complainant that the Respondent has retrospectively applied the increment sought by the Complainant and this therefore renders moot the claim in relation to the Employment Equality Act. 

The second complaint advanced by the Complainant is on the basis of the Payment of Wages Act 1991. In her submissions, the Claimant is seeking an award in relation to a pension lump sum and ongoing pension for her expected lifetime.

No jurisdiction in relation to pension entitlements 

It is submitted that, pursuant to section 1 of the 1991 Act, there is no jurisdiction in relation to awarding an amount in respect of pension. In that section “wages” are defined as follows:

“"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

(b) any sum payable to the employee upon the termination by the employer of his contract of employment without his having given to the employee the appropriate prior notice of the termination, being a sum paid in lieu of the giving of such notice: Provided however that the following payments shall not be regarded as wages for the purposes of this definition:

(i) any payment in respect of expenses incurred by the employee in carrying out his employment,

(ii) any payment by way of a pension, allowance or gratuity in connection with the death, or the retirement or resignation from his employment, of the employee or as compensation for loss of office,

(iii) any payment referable to the employee's redundancy

(iv) any payment to the employee otherwise than in his capacity as an employee,

(v) any payment in kind or benefit in kind, (vi) any payment by way of tips or gratuities.”

It is submitted that it is clear that the case of the Claimant is based on the pension and lump sum entitlement on retirement. These matters are explicitly excluded from the operation of the Act. It is therefore submitted that there is no jurisdiction to consider the case of the Complainant.

Claimant excluded in any event on the basis of the time of submission

It is apparent from the Claim Form of the Complainant that she has stated that the date on which she should have received payment in relation to the matters complained of was 5 June 2020. 

The Respondent therefore submits that the complaint of the Complainant falls outside the time provided under section 44 of the Workplace Relations Act, (being more than the maximum of 6 months plus another six months where reasonable cause is shown) and this complaint should not be entertained by the Adjudication Officer. 

In this regard, the Respondent will rely in particular on the decision of Keane J. in the High Court in Moran v. Employment Appeals Tribunal [2014] IEHC 154. [Appendix 1] The claim as presented begins on 5 June 2020 and as such, is similar to the claim by the Appellant in that case, which the court refused, stating at para. 21 that “…the appellant did not, as a matter of fact, present a complaint to the rights commissioner relating to a contravention of the 1991 Act alleged to have occurred on any specific date or dates within 6 months of the 17th May 2020. The appellant himself identified the contravention to which his complaint relates as an ‘application…for payment of a 5% wage increase awarded by Government to [HSNs] in the [HSE] with effect from 14 September 2007.’” 

It is submitted that in similar terms, the Complainant here has set out her complaint as starting on 5 June 2020, and that the case should not be entertained.  The Respondent also relies in this regard on the decision of Hogan J. in the High Court in Health Service Executive v. McDermott [2014] IEHC 331 [Appendix 2] where he stated as follows:

“For the purposes of this limitation period, everything turns, accordingly, on the manner in which the complaint is framed by the employee. If, for example, the employer has been unlawfully making deductions for a three year period, then provided that the complaint which has been presented relates to a period of six months beginning “on the date of the contravention to which the complaint relates”, the complaint will nonetheless be in time.  It follows, therefore, that if an employer has been making deduction X from the monthly salary of the employee since January 2010, a complaint which relates to deductions made from January, 2014 onwards and which is presented to the Rights Commissioner in June, 2014 will still be in time for the purposes of s. 6(4). If, on the other hand, the complaint were to have been framed in a different manner, such that it related to the period from January, 2010 onwards, it would then have been out of time.”  Again, it is submitted that the reasoning of Hogan J. above can be applied directly to the case at hand, and this case should be not be entertained as being out of time. 

Both of the above decisions were considered and applied in the decision of the Labour Court in The Institution of Engineers in Ireland/Engineers Ireland v. Richard Seaver PW/17/2. In that case, the Court examined the application of the Complainant and found that the case was out of time: “On examination of the relevant papers the Court finds that the Complainant framed his complaint in relevant part in the following terms ‘This complaint is about an alleged breach of contract and non-payment of wages. Contractual bonuses that were due to me in 2009, 2010, 2011 and 2012 continue to be withheld and unpaid. My contractual bonuses for 2013, 2014 and 2015 have been significantly underpaid. The non-payment and underpayment total is €31,538 but with compound interest this could be up to €35,000.’ As framed the Court finds that the complaint has its origins in an action of the respondent that commenced in 2009. The Complaint was not submitted to the Workplace Relations Commission until May 2015 some six years later. As the Complainant delayed some six years before bringing the Complaint the Court finds that as framed it must decide that it was commenced outside the statutory time limit for the bringing of complaints under the Act. Accordingly the Court must find that complaint is statute barred and that it has no jurisdiction to hear the instant appeal.”

In similar fashion, the Complaint in this case is framed in relation to a breach from 5 June 2020 and it is therefore submitted that it should not be entertained as it is out of time.

No jurisdiction to award ongoing losses

In the submission of the Respondent it is set out in the submissions of the Complainant that she is claiming for ongoing losses in relation to her pension. 

Without prejudice to the submission above that the complaint relates to pension, and is out of time as it relates, in the complaint form as set out by the Complainant, to a period of time commencing more than 12 months before the lodging of the form, it is submitted that the WRC does not have the jurisdiction to award monies in relation to ongoing alleged deductions. This was set out clearly in the case of A Public Servant v. A Public Authority ADJ-00027683  In the section headed “Summary of Respondent’s case” it is stated as follows:

“On the WRC complaint form the complainant has asserted that she is claiming for “ongoing losses”. Neither the Workplace Relations Act 2015 nor the Payment of Wages Act 1991confer jurisdiction on the WRC to make awards in respect of “ongoing losses” and the jurisdiction of the WRC is limited to complaints in respect of alleged contraventions that have occurred prior to the submission of the complaint.”  In this case, the losses claimed by the Claimant are calculated on the basis of her life expectancy “over her lifetime assuming she lives to 84 which is the average life expectancy for Irish women.”

Conclusion in relation to jurisdiction on the law on the preliminary issue: 

It is submitted that evidence in relation to the jurisdiction of the WRC should be heard as a discrete issue on the first day of hearing and that the Adjudicator should determine whether the Complainant’s claim is properly before them, in advance of hearing any evidence in relation to the substantive claim. It is submitted that such an approach is an efficient use of the resources and time of the WRC.

Submissions in relation to the substantive case

The case of the Complainant 

It is submitted that the Complainant’s substantive case is, in any event, not supported by the facts. The Complainant states that she would have remained in work, had she known that she could have improved her pension significantly within 18 months, through being put onto a higher scale and working for longer service on that scale.

Complainant not “entitled” to Higher Scale 

The Complainant was not at any stage “entitled” to be put on the Higher Scale. Rather, she had an entitlement to be considered to be put on that scale. The awarding of higher scales is predicated on satisfactory sick leave record and PMDS rating.

Complainant should have known of the salary scales 

The Complainant was a long-standing civil servant, having worked in the service since 1989. It is to be noted that the Complainant worked in National Shared Services Office (NSSO) from 25 March 2013. She commenced as a HR Manager in the Chief State Solicitor’s Office on 13 July 2015. She had also worked as an Assistant Principal in the Human Resources directorate of the Irish Prison Service. With her long career in Human Resources, the Complainant should have been aware of the Higher Scale which is set out in Circular 24/1995.  Her work in the Chief State Solicitors Office would have meant she was accustomed to reading legal documentation.

The Complainant retired at 53, but should have been aware that while she may have reached the highest point on the salary scale she was on, she could progress to the Higher Scale with satisfactory service. If it had not occurred in 2020, it could have occurred later with satisfactory service. Therefore it is submitted that a theoretical case whereby the Complainant asserts that she would have worked for a longer period of time had she been aware of certain facts, that we strongly assert that a person with her professional knowledge, longevity of service and particular experience should have known, should not be successful.  In this regard, the submissions of the Claimant asserts that she did not know that there was a Higher Assistant Principal scale that she could progress through. It is submitted that this should not be accepted.

No additional obligation to inform

It is asserted in the submissions that the Complainant should have been informed by her employer of possible future entitlements. This is rejected. The Complainant, as with all her colleagues, is informed of the existence of the relevant circulars. In addition, it should again be noted that the Complainant worked in the HR function and advised others in relation to their entitlements, and therefore should have been particularly well-versed in pay and salary scales. Further, the submission of the Complainant highlights that the Complainant carried out an examination of the scale she was on prior to considering to retire early. It is submitted that it is hardly believable that such an examination could have been carried out by such an experienced HR practitioner without becoming aware of the existence of Higher Scales. 

The Complainant never sought to have sick absences discounted at the time they were accrued. Instead, years after the fact she sought retrospectively to have absences discounted so she could be considered for a higher salary scale, which was eventually done on appeal to the Personnel Officer who has discretion in these matters. Such discretion was ultimately exercised in the Complainant’s favour.  It is noted that the Complainant continued to take sick leave for pain up to August 2021, as set out in her record of absences.

Given the correspondence between the parties about the sick leave record and the resulting discounting of certain days, the discretionary awarding of the increment retrospectively to the Complainant, and back-dating it to 2020, is more than fair, and goes beyond what is supported on the documentation.  In addition, the Complainant has asserted that the failure of the Respondent to inform her of the scale (any such obligation being denied) led directly to her application for early retirement. No evidence has been produced to this effect.  In fact, it is the position of the Respondent that no enquiry in relation to the Complainant’s pension benefits was submitted to the National Shared Services Office in the 6 months prior to the retirement.

Conclusion 

The Claimant’s case as now formulated through submissions is based on seeking pension payments which are specifically excluded under the Payment of Wages Act.  In any event, the Complainant has failed to submit her complaint within the required 6- month timeframe, as it has been based on a claim from June 2020 onwards, which is well beyond 12 months before 22 July 2022, and therefore outside the timeframe for consideration by the WRC.  In addition, the Complainant is claiming for alleged ongoing losses, which, it is submitted, cannot be awarded under the 1991 Act. 

In relation to the substantive case, it is submitted that the Complainant knew or ought to have known of the relevant wage scales, given her history in the civil service and her particular roles including in HR. 

It is denied that there was an obligation on the employer to inform her of the possibility of her advancing to another scale in those circumstances.  In any event, it is denied that the Complainant can assert after the fact that she would have remained working for a period of time, and claim the potential benefits that would have accrued to her if she had so worked. It is submitted that it is not certain that she would have advanced on the scale, as that is dependent on attendance and performance which cannot be stated with certainty.  The Respondent therefore seeks this case to be dismissed in its entirety.

Findings and Conclusions:

Jurisdictional issue

There were a number of preliminary and jurisdictional issues raised by the Respondent.

Those issues can be summarised as pension being excluded from the definition of wages and time limits in respect of the claim around the wording “beginning on the date to which the complaint relates”.

The applicable law

The full definition of wages contained in the Act is as follows:

“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
• (b) any sum payable to the employee upon the termination by the employer of his contract of employment without his having given to the employee the appropriate prior notice of the termination, being a sum paid in lieu of the giving of such notice:

Provided however that the following payments shall not be regarded as wages for the purposes of this definition:

• (i) any payment in respect of expenses incurred by the employee in carrying out his employment,
• (ii) any payment by way of a pension, allowance or gratuity in connection with the death, or the retirement or resignation from his employment, of the employee or as compensation for loss of office,
• (iii) any payment referable to the employee's redundancy,
• (iv) any payment to the employee otherwise than in his capacity as an employee,
• (v) any payment in kind or benefit in kind.

I find that the element of the Complainant’s complaint as it relates to her pension payments is not covered by the definition in the Act.  I therefore have no jurisdiction and this element of the complaint is not well founded.

In the matter of whether another element of the complaint encompassing wages deemed by her to have been properly payable in the course of her employment, before retirement, the matter of time limits has to be considered.

Time limits

The complaint was received on 22nd July 2022.  At that stage the Complainant was retired at the top of the scale of the AP ordinary scale.   

Section 41 (6) of the Workplace Relations Act 2015 provides:

“Subject to subsection (8), an adjudication officer shall not entertain a complaint referred to him or her under this section if it has been presented to the Director General after the expiration of the period of 6 months beginning on the date of the contravention to which the complaint relates.

Section 41 (8) provides:

“an adjudication officer may entertain a complaint or dispute to which this section applies presented or referred to the Director General after the period referred to in subsection (6) or (7) (but not later than 6 months after such expiration), as the case may be, if he or she is satisfied that the failure to present the complaint or refer the dispute within that period was due to reasonable cause”.

The Respondent’s point is that as the Complainant’s case is framed in relation to a breach from 5 June 2020, it should be deemed to be out of time.  At the point of submission of the complaint, the Respondent was refusing to award the Complainant the increment which was later awarded retrospectively.  The decision of Hogan J. in Health Service Executive v McDermott [2014] IEHC 331 is pertinent.  In it he states:

“… the key question is the “date of the contravention to which the complaint relates”. In other words, time runs for the purposes of the Act not from the date of any particular contravention or even the date of the first contravention, but rather from the date of the contravention “to which the complaint relates”. 

In this instant case, the Complainant specifically refers to deductions made from 5 June 2020.However had the Complainant been given the increment in June 2020, she would have been paid at that rate during the course of her employment from then until her retirement in January 2022.       She did not become aware of the eligibility for appointment to the top of the AP Higher scale until April 2022 and there ensued lengthy correspondence between her and the Department around the award of the increment which was originally denied by the Department.  I note that she did not become aware of the whole situation until after she retired.  I note that in the period July 2021 to January 2022, she was on the top of the AP scale.  At that point neither she nor the Department appeared to be aware of the potential award of a further increment.  I find that as the Complainant was not aware of the situation until April 2022, and she spent some considerable time arguing her case for award of the increment, it is reasonable to extend the time for consideration of her complaint to run from 22 July 2021.    

The question then is whether she was in receipt of wages “properly payable” from then until her retirement.  I note the awarding of the increment is not automatic. 

There were many hypothetical arguments put forward in this case.  What if the Complainant had been awarded the increment in June 2020?  What if she had knowledge of this and the potential for securing a further long service increment?  She stated that she would have stayed on in the employment had she known this.  I find that the Payment of Wages Act is not designed to cover complaints of what might have been.   I find that at the time which I have extended to include July 2021 to January 2022, the Respondent did not deduct wages from the Complainant or act contrary to Section 5 (6) of the Act.

For the reasons stated, I find the complaint to be not well founded.

Decision:

Section 41 of the Workplace Relations Act 2015 requires that I make a decision in relation to the complaint in accordance with the relevant redress provisions under Schedule 6 of that Act.

I have decided that the complaint is not well founded.

Dated:  04 July 2023

Workplace Relations Commission Adjudication Officer:  Gaye Cunningham

Key Words: