Worker

Employer

Anonymised Parties

Worker

Employer

Representatives

  Self

Employee Relations Manager

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 - 00001567

20/07/2023

The Worker has been employed by the Employer since 1998 in a professional healthcare role on a sessional part-time basis.  She is seeking admittance to the Employer’s pension scheme with effect from 2002 on the same basis as other healthcare professionals who carry out a different role.

The Employer has offered to admit the Worker to its pension scheme on the same terms as offered to another employee in accordance with a ruling of the Pensions Ombudsman.  This offer is not acceptable to the Worker.

The Worker submits as follows:

The Worker is employed on a sessional basis. The Worker submits that they have been paid a flat hourly rate from the beginning of their employment which has never been reduced depending on hours worked.  Furthermore, their hours were never limited to 21 hours per week. This means that they are paid outside the parameters for sessional workers set out in the consolidated pay scales.  This was a decision that was made by the Employer and the Worker was never consulted about this decision nor was this decision negotiated on their behalf.

The service in which the Worker is employed was expanding rapidly at the time of their recruitment.  Like the Worker, many of the staff were employed at grades that were not included in, or deviated from, the consolidated pay scales.

The Worker’s conditions of employment are not the same as non-sessional workers who carry out the same role. The Worker’s hourly rate is €47.65. The Worker is entitled to 20 days paid annual leave.  The Worker is deemed ineligible for overtime rates and receives no allowances e.g. mileage, subsistence etc.  The Worker worked part-time for nine years, becoming full-time in mid-2007.

In 2021, the Worker discovered that a colleague who had started in the service around the same time, albeit in a different role, had been admitted to the Employer’s pension scheme in 2004 despite also being employed on a sessional basis.  The Worker was told that the colleague’s pensionable income was capped at 39 hours per week and that other colleagues who worked under 39 hours were allowed to join the pension scheme on a pro-rata basis. The Worker subsequently wrote to the Employer’s superannuation section requesting to join the pension scheme on the same basis as their sessional colleagues.

Having received no reply on two occasions, the Worker made a complaint to the WRC.  The outcome of that complaint was that they were offered a pension based on two rulings by the Pensions Ombudsman in 2009 and 2011.

Until the Worker read the Employer’s submission, they had not realised the significance of how they were employed.  Unlike the other sessional workers in the same role currently, the Worker had been given a contract at the start of their employment in which they were designated an Officer of the Employer.

The Worker submits that the Employer accepts that that gave the Worker the right to be admitted into the pension scheme in 2002 when temporary officers were given an option to join the scheme.  The Worker submits that they were not given the option to join the pension scheme at the time, and were only informed of this, over 20 years later, via the submission of the Employer to the WRC.

An FOI reply obtained from a colleague in May 2010 confirms that a small number of employees who are in receipt of a sessional rate of pay have been admitted to the Employer’s pension scheme. The first of these individuals was admitted in 2002, as the Worker should have been, and the last was admitted in 2003. 

The Worker contends, therefore, that they should be admitted to the pension scheme in the same way as other temporary officers were.  The Worker asserts that rulings made years later in 2009 and 2011 by the Pensions Ombudsman do not apply to them for the following reasons:

·        The rulings are personal rulings for the two employees concerned.

·        The Employer admitted that, as a Temporary Officer, the Worker should have been offered admission to the pension scheme in 2002, seven and nine years earlier.

·        The Employer claimed in its evidence to the Pension’s Ombudsman in one case that it believed that sessional workers were providing a contract for service, and that they were not employees. A large part of the work done by the Pension’s Ombudsman in that case was to try to establish if the employee in question had a contract for service or a contract of service. The Worker asserts that this is not applicable in their case as they were employed as a Temporary Officer.

·        The Pensions Ombudsman was misinformed about the rate of pay for sessional workers who are carrying out the same role as the Worker in this case.  In one of his determinations, the Pension Ombudsman stated that:

“I am conscious that sessional workers receive payments which are not based on a uniform rate per hour, but that the effective hourly rate changes…Those who work the smallest number of hours receive a proportionately higher payment than those who work the maximum number.  It therefore appears to me that the equitable treatment of such workers may be useful.  The following paragraphs are therefore to be regarded as such guidance and are not intended to dictate the rules of the scheme, merely to suggest a method by which an equitable solution may be reached.

“In the case of sessional [workers], the maximum hours envisaged appear to be 21, which yields the minimum effective hourly rate for the job.”

·        The Pensions Ombudsman was not informed that the consolidated pay scale was applied only at the headline hourly rate and that:

o   the hourly rate remained uniform for all hours worked daily or weekly and was not reduced after the first six hours;

o   the hours for a sessional worker in the Worker’s role was never capped at 21 hours per week;

o   those who work the smallest number of hours do not receive a “proportionately higher payment than those who work the maximum number” – they receive the same hourly payment;

o   therefore, no “effective hourly rate” exists and this should not have been used to calculate pro-rata integration;

o   The Employer admitted in its submission that the changing rate and maximum hours were never applied to sessional workers in the Worker’s role.

·        The Pensions Ombudsman was misinformed regarding the “comparator grade” for one of the employees:

o   The Pensions Ombudsman was given the salary of a lower grade to compare with the salary of a sessional worker despite a company/union agreement that all whole- and part-time employees working in the service are appointed at a higher grade to acknowledge the specialist nature of the service; and

·        The Pensions Ombudsman was not informed by the Employer in either case that another cohort of sessional staff, who work in the same service were granted pro-rata entry to the pension scheme in 2004 at their actual hourly rate of renumeration, capped at 39 hours per week. 

·        Also relevant in the Pension Ombudsman’s determination is:

o   the full-time equivalent salary figure used in the calculations should be the annualised sessional rate less the loading for pension (the Employer has agreed a 10% loading for pension); and

o   pensionable service will be pro-rated to the hours actually worked in any year or portion of a year worked i.e. aggregate hours worked divided by (33.75* x 52.14) (*weekly hours are now 35).

The Employer submits as follows:

The Worker’s complaint relates to their dissatisfaction with the offer from the Employer to allow them to join the Employer’s pension scheme on the same terms as offered to another employee in accordance with a ruling of the Pensions Ombudsman.    

It is not within the ability of the Employer to amend a recommendation of the Pensions Ombudsman and the appropriate avenue for the Worker to have their pension issues dealt with is through the Pensions Ombudsman.  It is the contention of the Employer that this is not an individual issue but one that will affect all sessional working within the Employer organisation in the same role as the Worker. 

Sessional workers in the same role as the Worker are paid in accordance with the Employer’s consolidated pay scales. They are not paid in line with the full-time salary for the role. It was always envisaged that they were providing a contract for service to the Employer rather than as an employee. It is against that background that payment is based on an hourly commitment and paid according to hours worked. The inappropriate use of sessional part-time rates is currently under review and cannot be applied to new staff.

It should be noted that this contractual arrangement and payment level is contingent on a maximum hourly commitment of 21 hours per week. That cap was not applied as the service when introduced was under significant pressure. 

Historically, where such a claim was made the question of salary to be pensionable was always at the centre of the dispute. The Pensions Ombudsman has issued decisions on similar claims.

Many of the sessional workers engaged by the Employer were working anything from 6 hours a week to 50 hours a week and they received the higher rate for all hours worked. That led to those working 39 hours or more earning well in excess of an employee in the same role employed on a contract of service by the Employer.  It should be noted that Employer’s funding authority does not approve of pension benefits flowing from such an enhanced rate of pay, a rate of pay that is not the standard salary for the grade. 

In this case, a further consideration arises in terms of when the Worker might have a right to enter the pension scheme. The Worker commenced employment in February 1998. The Worker was engaged on a temporary basis. In their role, the Worker would be designated as an officer. Temporary Officers were given an option to join the scheme in February 2002. Therefore, if the Worker is deemed to be an employee and accepts that the salary for pension is based on the consolidated salary, they can only have access to the scheme from 2002. 

A business case has been submitted to the Employer’s funding authority setting out the basis of the Worker’s role with the Employer organisation from 1998 together with their request to join the pension scheme. That case is under consideration. 

Essentially the claim is for approval to access the Employer’s pension scheme. It has been the stated position of the Employer that persons engaged by the service on a sessional basis are precluded from joining the pension scheme as their pay is not based on the standard salary scale as approved by the funding body. Sessional workers in the Worker’s role are paid an enhanced rate of pay per hour based on a contract for services relationship. There is a process by which individuals can opt to join the scheme. That entails reducing their salary to the standard pay scale, pro-rated to the hours worked if less than 39. They are also required to repay the enhanced part of their salary for the duration of service. This proposal was not acceptable and sessional staff have decided to retain their enhanced rate of pay. 

With the introduction of the Protection of Employee (Part-Time Work) Act 2001 and the Protection of Employees (Fixed-Term Work) Act 2003, sessional staff were afforded additional statutory rights where they can show that they are working under a contract of employment. This was an argument by sessional staff to challenge the need to reduce their salary stating that they do not have access to the employment rights enjoyed by those on the approved salaries. The only difference between the sessional staff and those on the approved salary is access to the pension scheme. Sessional staff however continue to enjoy remuneration that is much greater than those on the approved salary scale. 

Two cases that mirror this case were submitted to the Office of the Pensions Ombudsman in 2009 and 2011. The Pensions Ombudsman put forward a proposal where the Employer could allow sessional staff access the pension scheme. He annualised the rate applying for the hours capped at 21 per week and then suggested an unloading of the annualised salary to take account of the additional remuneration included as compensation for the lack of pension benefits. As of October 2021, that annualised rate would amount to €63,204.29. Unloading the percentage for the pension component of say 10% would leave a salary for pension purposes of €56, 883.86.  It should be noted that one of the determinations did not call for the sessional worker to repay the enhanced portion of salary they received from their commencement date. 

In a more recent Labour Court case, LCR22378, a recommendation issued in terms of a similar case. In that case, there was no dispute between the parties as regards whether the claimant should be permitted access to the pension scheme. The dispute was in relation to the rate of pay for pension purposes and the entry date for the claimant to the pension scheme. The Court agreed that the break in service served to delay the claimant’s entry to the scheme and put forward a rate of pay for pension purposes. This rate of pay was significantly less than the remuneration the claimant was in receipt of. There was no dispute in relation to the liability of the claimant for pension related deductions / contributions including retrospective contributions / deductions. The Court recommended that the claimant, prior to implementation of the terms of the recommendation, be supplied with full and comprehensive detail of her liability for all appropriate contributions and deductions that result from entry to the scheme.

Application was made by the Employer to its funding authority to ascertain if the Worker was eligible to access the Employer’s pension scheme.  A reply was received outlining that the Worker satisfied the criteria to access the Employer’s pension scheme subject to conditions outlined.  The Employer will now facilitate the Worker in accessing the appropriate scheme once they indicate that they agree to do so.  

If the Worker is willing to accept this offer, the Employer will immediately facilitate them with access to the scheme on the same basis as that granted by the Pension Ombudsman to a named colleague.  If the Worker is not satisfied with the decision, they may appeal it to the Pensions Ombudsman.

In the course of the hearing, the Employer referred to a pensions appeals process which exists within its organisation.  The Employer noted that, in all likelihood, the appeals process would involve the appeals officer examining all the facts pertaining to the Worker’s case.  If the appeals officer finds against the Worker, then the matter can be referred to the Pensions Ombudsman.

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

I note that the Employer has an internal pensions appeals process which has not been utilised by the Worker to progress her dispute.

In Geoghegan T/A Taps v a Worker INT 1014 the Labour Court held that:

“The Court is not prepared to insert itself into the procedural process in a situation where the dispute procedures have been bypassed.”

It is well established by the Workplace Relations Commission and the Labour Court that they do not intervene in a dispute under Section 13 of the Industrial Relations Act 1969 until all internal grievance procedures have been fully exhausted.

As it has not been shown that the internal procedures have been exhausted, I recommend that the Worker engages in a meaningful way with the Employer’s pensions appeals process regarding the investigation of her complaint. 

Industrial Relations Dispute – requirement to exhaust internal procedures