Complainant

Respondent

Parties

Ivica  Parlov

Pfp Fire Systems Ireland Pfp Ireland

Complainant

Respondent

Anonymised Parties

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Representatives

  Mr Michael Hegarty

 Mr Daniel Knight, Operations Manager

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-00065097-001

30/07/2024

The complainant, Mr Ivica Parlov, worked for the Respondent, PfP Fire Systems PfP Ireland.  In early 2024 he had his hourly rate of pay reduced by €2.50.  The respondent’s position is that this was permitted under the terms of his contract and that the reduction related to performance.

Evidence was given under oath/affirmation by Mr Parlov with the assistance of an interpreter who also took an oath/affirmation.  Evidence was given under oath/affirmation, on behalf of the respondent, by Mr Daniel Knight, Operations Manager.  All evidence was subject to cross examination.  Any written submissions and documents received were considered by me.

The complainant commenced employment with the respondent on 2 October 2019. His starting wage during the probationary period was €14.52 per hour. After successfully completing the probationary period, his employment was confirmed as permanent on 18 March 2020 and he was issued with a statement of the main terms of employment on 18 March 2020 which he signed. Throughout his employment with the Company, the complainant worked very hard and his Supervisors and Managers regularly expressed satisfaction with his work. The Company acknowledged its satisfaction by incrementally increasing his starting wage from €14.52 an hour to €19.50 an hour. On the morning of Wednesday 31 January 2024, the complainant was taken ill and certified by a doctor until 2 February 2024. He  was paid 3 days statutory sick pay. The complainant returned to work on Tuesday 06 February 2024 (Monday 05 February was a bank holiday). On Thursday 8 February 2024 he received a letter from the respondent’s Operations Manager stating the following;

 “Dear Ivica, following a recent performance review I can confirm the decision has been made to decrease your weekly pay. As discussed with your contracts manager earlier this week, your BORIS uploads do not match the expected values from an operative with your employment costs. As of the 12th of February, your hourly Rate of pay will be €17.00 per hour. This new rate will be reflected on the payslip for week 08, dated the 23rd of February. Your performance will be reviewed again within 8 weeks and at that review we would expect to see a significant improvement to at least meet the minimum acceptable level. If you are not reaching the required standard by this stage then a further pay grade deduction will be sanctioned or if deemed necessary, full dismissal from PFP Ireland may be actioned. Further information regarding a strategy to meet company expectations can be provided by your Contracts Manager:

What action or improvement is to be taken to prevent further disciplinary action.

The time limit by which action should be taken or improvement made.

 A plan for assistance and review.

Quantifiable instructions directed to meet minimum standards.

Thank you for yourunderstanding and please appreciate this does not have to be a permanent reduction.”

The decision to unilaterally reduce the complainant’s hourly wage was made without agreement or consultation. Further he was given no right of appeal. It should be noted that he was warned that if there was not a significant improvement in his work within 8 weeks “a further pay grade deduction will be sanctioned or if deemed necessary, full dismissal from PFP Ireland may be actioned.” With effect from 12 February 2024 his hourly wage was decreased from €19.50 to €17.00 per hour (a reduction of €2.50 an hour). Mr Derek McCloskey, the complainant’s on-site manager, informed the complainant that he wanted this decision to be an incentive for him to improve his work and effort. He said it was unacceptable to not enter anything in the "Boris" app (a system for recording output of staff), and that the complainant couldn’t let his colleagues slow him down. He attached 3 tables of logs from "Boris" on which the complainant’s performance review was based, showing he did not reach the required quota for the week. It should be noted that all 3 attachments were the same and related to the week when the complainant was ill and had worked only 2 days that week. This pay decrease could have led to the complainant losing mortgage approval.

The respondent relies on the complainant’s contract of employment which states as follows;

PAY

Pay will be in compliance with the Construction Industry Sectoral Employment Order.

(details of various applicable hourly rates for different levels)

Your level of pay will depend on your experience and productivity as well as the quality of install and accuracy of Boris (for which training will be provided). A performance review will be carried out quarterly to assess that you are on the appropriate level of pay. Your pay level on commencement of this contract is level 4.

In the final quarter of 2023 the complainant’s performance as evidenced in the ‘Boris’ system was significantly below the expected level.  The decision to reduce his hourly rate was based on a period of time before he had his sick leave issues. 

Section 5 of the Payment of Wages Act 1991 states;

5.—(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.

The respondent relies on (b) above and has argued that the following clause in the complainant’s contract allows for the reduction in hourly pay;

Your level of pay will depend on your experience and productivity as well as the quality of install and accuracy of Boris (for which training will be provided). A performance review will be carried out quarterly to assess that you are on the appropriate level of pay

However, the clause in the complainant’s contract relating to pay also stated that ‘Pay will be in compliance with the Construction Industry Sectoral Employment Order’

Sectoral Employment Orders SEOs) place a legally binding floor on rates and obligations in the sectors throughout the country. The SEO defines what activities place an employer within the construction sector and what experience and qualifications place a worker in a particular employee class.  There is nothing in the provisions of the SEOs that allow for the hourly rate to be reduced in the manner applied by the respondent in this instance. 

Secondly, it is clear from the letter notifying the complainant of the reduction in pay that it was considered to be a disciplinary issue.  From the evidence given at the hearing I am satisfied that the normal rules governing any disciplinary process were not applied and due process was ignored.

In both of these circumstances I find that the reduction in the hourly rate was unlawful and the complaint is well founded.

The complainant quantified his loss at €1,075 and the respondent did not provide any evidence to the contrary.

The complaint is well-founded and I order the respondent to pay the complainant €1,075 in respect of the unlawful deduction of wages.

Reduction in hourly rate of pay.  Sectoral Employment Orders