ADJ-00037898

Complainant

Respondent

Parties

Sharon  Brennan

Tesco Ireland Limited Tesco

Representatives

Ken Reilly, Mandate Trade Union

Niamh Ní Cheallaigh, Ibec

Act

Complaint/Dispute Reference No.

Date of Receipt

Complaint seeking adjudication by the Workplace Relations Commission under section 6 of the Payment of Wages Act, 1991

CA-00049306-001

23/03/2022

The Complainant commenced employment with the Respondent on 21 December 2016 and is employed on a 20-25hr per week contract earning €13.49 per hour as a Customer Assistant.

This complaint was received bt the Workplace Relations Commission on 23rd March 2022.

1.      The Complainant was absent due to ill-health for the period 13 June 2021 to 19 September 2021.

2.      Accordingly, the Respondent proceeded to pay the Complainant sick pay in line with the company sickness policy and company sick pay scheme. The Respondent provided 8 weeks sick pay to the Complainant in line with her contract of employment and Company Sickness Policy

3.      At section 12 the contract states that “Sick pay is paid less the current value of social welfare illness benefit and is conditional upon the provision of medical certificates and compliance with procedures for notification. Your sick pay can be paid up to a maximum of 8 weeks in any one year. The first 3 days of any period of sickness absence is unpaid. The sick pay scheme is managed in line with the Company Sickness Policy.’’

4.      The Respondent’s social welfare process in relation to sick pay as agreed with Mandate/SIPTU trade unions outlines that from the fourth day of consecutive sickness absence the Company will adjust the employees pay downward by the value of the illness benefit for each paid sick day. The employee will retain any social welfare illness benefit cheques received from the Department of Social Protection. The employee’s absence will be recorded on their payslip, normally the week after they are absent.

5.      Due to the length of time it takes to receive Illness Benefit cheques from the Department of Social Protection, colleagues do not see the adjustment in their pay until 3 weeks’ time, which in effect means that the adjustment is on a 3-week delay.  This is to ensure that colleagues are not unnecessarily inconvenienced where there may be a delay in receiving cheques. 

6.      In addition to the above to further support colleagues the agreed Company/Union Social Welfare process states:

“All staff members employed on or after 1st January 2012 that work less than the full-time hours that apply in their store, and do not at the time of a period of certified sickness absence have an Illness Benefit entitlement, and submit written evidence of this from the Department of Social Protection (see contact details below) within 2 weeks of the start of the sickness absence, to their Line Manager, will be subject to a reduced (pro-rata) adjustment to their Company sick pay reflecting their actual rostered hours”.

7.     The Complainant was employed post 2012, works less than full time hours and at the time of her absence submitted evidence from the Department of Social Protection that she was entitled to €1 Illness Benefit. Rather than treat her as having an illness benefit entitlement which would have resulted in a social welfare adjustment of a total of €1624 over the 8 weeks (€203*8) the Respondent applied the rules of the Sick Pay Scheme Process under point 5 (set out above). This meant that she received a reduced (pro-rata) adjustment to her sick pay reflecting her actual hours (€203/39 fulltime hours *20 hours = €104*8 = €832). Therefore, in line with Company Policy and procedures that is applied across the entire business the total amount of the Illness Benefit downward adjustment applied was €832.

8.      It should be noted that the Complainant was refunded €17.80 for the error caused by her being deducted €849.80 instead of €832.00.

9.      On 20 November 2021 the Complainant raised a grievance setting out that she believed she was owed €841.80 as it was her contention that she should have received 8 weeks full pay less social welfare entitlement.

10.   Ms Mary White, Colleague Relations Partner, investigated the Complainant’s grievance. Having conducted a full investigation and taking everything into consideration, Ms White issued the outcome on 23 December 2021 in which she set out that the Complainant had been paid correctly in line with the Respondent’s policy and therefore she was not entitled to a payment of €841.80 as contended by her.

11.   The Complainant appealed the grievance outcome which was heard by Ms Deborah Comiskey, Store Manager who did not uphold the appeal.

Respondent’s Position

12.   The Respondent refutes the claim under the Payment of Wages Act in its entirety as no unlawful deduction of wages has occurred in line with the Complainant’s contract. Furthermore, the Respondent is at a loss to understand why we are here today, as the agreed Company/Union Social Welfare process in relation to sick pay was followed in full.

13.   Section 5 of the Payment of Wages Act 1991 states as follows:

(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.

14.   At no point has the Complainant received a salary below her contractual salary. In making this statement the Respondent is taking into account not only the Complainant’s clear written contract of employment, but also the operation of this contract in reality and the established norms of the Respondent more generally.

15.   The Complainant is arguing that there was a deficiency in payment of her wages in the period in question. The Payment of Wages Act, 1991, under section 5(6) states:

“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, […] then […] the amount of the deficiency […] shall be treated as a deduction made by the employer from the wages of the employee on the occasion”.

16.   Thus, the important element to establish is what were the wages “properly payable” to the employee on “that occasion”. The Respondent contends that the wages “properly payable” to the employee were the wages as advised to the employee in line with the Respondent’s Sickness Policy cited in the Complainant’s contract of employment. No deduction as defined in Section 5 of the Act has been made. Accordingly, no jurisdiction exists under the Payment of Wages Act 1991 for this claim to be heard.

17.  Any deduction made to the Complainant’s salary were made in accordance with Section 5 of the Act, namely deductions 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.

18.   Section 6 of the Act of 1991 states as follows:

“A decision of an adjudication officer under section 41 of the Workplace Relations Act 2015, in relation to a complaint of a contravention of section 5 as respects a deduction made by an employer from the wages of an employee or the receipt from an employee by an employer of a payment, that the complaint is, in whole or in part, well founded as respects the deduction or payment shall include a direction to the employer to pay to the employee compensation of such amount (if any) as he considers reasonable in the circumstances not exceeding —

(a ) the net amount of the wages (after the making of any lawful deduction therefrom) that —

in case the complaint related to a deduction, would have been paid to the employee in respect of the week immediately preceding the date of the deduction if the deduction had not been made,

or

in case the complaint related to a payment, were paid to the employee in respect of the week immediately preceding the date of payment,

                   or

(b ) if the amount of the deduction or payment is greater than the amount referred to in paragraph (a) , twice the former amount.”

19.   Further to the above, redress under Section 6 of the Act of 1991 does not apply as a contravention of Section 5 in respect to a deduction made by the Respondent did not occur.

20.   Notwithstanding the above point, in relation to the Social Welfare illness benefit adjustment the Respondent seeks to rely on the particulars of their Sickness Policy and Social Welfare process in relation to sick pay which states that:

“From the fourth day of consecutive sickness absence the Company will adjust your pay downward by the value of the Illness Benefit for each paid sick day. You will retain any Social Welfare Illness Benefit cheques received from the Department of Social Protection. Absence will be recorded on your payslip normally the week after you are absent.’’

21.   The Social Welfare Process further states:

“All staff members employed on or after 1st January 2012 that work less than the full-time hours that apply in their store, and do not at the time of a period of certified sickness absence have an Illness Benefit entitlement, and submit written evidence of this from the Department of Social Protection within 2 weeks of the start of the sickness absence to their Line Manager will be subject to a reduced (pro-rata) adjustment to their Company sick pay reflecting their actual rostered hours.’’ 

22.   The process sets out an example of how the reduced pro rata adjustment applies;

“Example - €37.60 is the current social welfare illness benefit entitlement for 8 hours. €188 is the illness benefit entitlement for a full week. The employee’s average earnings over the previous 13 weeks will be used to calculate a week’s hours. In this example the stores standard full-time hours is 39 hours. Therefore 24 hours average weekly earnings will be the IB value adjustment €115.70 (188/39 * 24). Where the standard hours are different to 39 hours in a store then the calculations will be made accordingly”.

Note: this reflects the value of the IB benefit in 2012 which in 2021 was €203 therefore the calculation for the Complainant is 203/39*20 = €104 per week * 8 weeks is €832

23.   The Respondent correctly applied the above protocol during the Complainant’s period of absence.

Conclusion.

It is the Respondent’s position that they complied with the Complainants terms and conditions of employment including the correct application of the Company Sickness Policy and Company/Union agreed Social Welfare Process correctly. Therefore, no unlawful deduction was made and the complaint under the Payment of Wages Act is not well founded.

Based on the detailed arguments above, the Respondent respectfully submits that there is no case to answer by the Respondent and accordingly the matter should be dismissed.

The current company process for sick pay was agreed between the company and two trade unions representing the workforce, this agreement took effect from 1st January 2012.

Representative for the respondent has stated the following through submission:

“The Complainant was employed post 2012, works less than full time hours and at the time of her absence submitted evidence from the Department of Social Protection that she was entitled to €1 Illness Benefit. Rather than treat her as having an illness benefit entitlement which would have resulted in a social welfare adjustment of a total of €1624 over the 8 weeks (€203*8) the Respondent applied the rules of the Sick Pay Scheme Process under point 5 (set out above). This meant that she received a reduced (pro-rata) adjustment to her sick pay reflecting her actual hours (€203/39 fulltime hours *20 hours = €104*8 = €832). Therefore, in line with Company Policy and procedures that is applied across the entire business the total amount of the Illness Benefit downward adjustment applied was €832”.

In addition to this statement the following table of payments was included:

I have no expert knowledge of sick pay policy in operation however I cannot find fault with what the Respondent has done.

It is for this reason that I find that the argument presented by the Respondent is more credible.

It is for this reason that I find that the complaint as presented is not well founded,

I have no expert knowledge of sick pay policy in operation however I cannot find fault with what the Respondent has done.

It is for this reason that I find that the argument presented by the Respondent is more credible.

It is for this reason that I find that the complaint as presented is not well founded.