Complainant

Respondent

Parties

Malachy  Duffy

Eurotech Renewables Ltd

Complainant

Respondent

Anonymised Parties

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Representatives

  In person

Anna Rosa Raso ESA Consultants

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-00065580-001

23/08/2024

This is a payment of wages complaint arising out of a deduction from the Complainant’s wages on the last day of his employment, following a finding by the Respondent that a hot water boiler in a home of a  customer of the Respondent had been fitted negligently.

The Complainant gave the following evidence under affirmation:

1.       He was employed by the Respondent as a plumber on 23 January 2023.

2.       He was assigned to do a job in Galway on 22 March 2024 which included fitting a new hot water cylinder in a customer’s house.

3.       As far as the Complainant was concerned, there was nothing wrong with the work that he did and his supervisor who had worked alongside him on the job, signed off on the adequacy of the job when they had finished.

4.       Having told his employer that he intended to leave the job on 19 July 2024, on 16 July 2024 he was asked to attend an exit meeting on the last day of his employment.

5.       On 19 July 2024 at the exit interview during he was told that his defective work on the Galway job, had cost the company €1100 to remedy and that this cost would be charged to him and the other worker on the job. The Complainant was told that his contribution would be €491.73 which would be deducted from his last salary payment later that day, namely on 19 July 2024.

6.       A deduction of €491.73 was applied to his salary on 19 July 2024 and the Complainant contends that this deduction was in breach of the Payment of Wages Act 1994.

In cross examination the Complainant admitted as follows:

7.       His contract expressly allows for a deduction to be made in accordance with section 5 of the Payment of Wages Act 1991.

8.       He said that he was unaware of any damage done to the boiler at the time of the fitting.

9.       He did not take photos of the fitted boiler because that was more properly the responsibility of the supervisor who attended the job with him.

10.   When asked if a damage report form was served on him after the customer complained, which would have put him on notice of the customer complaint, he said that it was not. He said that he was not made aware of any difficulty with the work or that a salary deduction was being made until the last day of his employment.

11.   When asked did he not contact management when, what he claims was an unlawful deduction,  was made, he said that her texted the director of the company but that he did not have this text available as evidence at the Adjudication hearing.

Gerard Duffy, Head of Mechanical Engineering with the Respondent gave the following evidence under affirmation:

1.       The Complainant was assigned a job of installing a hot water cylinder in a customer’s home in Galway on 22 March 2024.

2.       The customer complained to the Respondent by email on 26 March 2024 that the hot water cylinder was badly damaged and that the two employees of the Respondent had not told her of the damage at the time of the installation.

3.       A damage report form showed that the cylinder had been forced into a hot press cupboard, which had damaged the cylinder. The customer refused to pay the Respondent for the work until the issue was rectified.

4.       A new replacement cylinder had to be fitted by the Respondent. This was done by another Respondent plumber who was able to replace the broken cylinder with a new one by himself without any assistance.

5.       The Complainant was sent a damage report form after the customer complaint was received and despite being asked, the Complainant did not complete or return it.

6.       What the Complainant says about not being aware of any problems with the work this is untrue. The Complainant was sent an damage report form at the time and then, when the defective cylinder was returned to site,  the Complainant took a photograph of himself with his arm around the clearly damaged cylinder.

7.       The Complainant tendered his resignation and between that and his last day of work, there was no time to give him any notice that a deduction to his wages would be made other than on the last day of his employment on 19 July 2024. He was informed that this deduction would occur at an exit meeting and he was told that it would be deducted on that date. The same deduction was made in respect of the Complainant’s co-worker.

8.       The Complainant’s contract allowed for a deduction in such circumstances and the deduction was made in accordance with the Payment of Wages Act 1991.

The Complainant did not cross examine this witness.

This complaint requires a consideration of the following question:

Was the deduction that was applied to the last salary payment to the Complainant on 19 July done in compliance with the statutory requirements of the Payment of Wages Act 1991?

The Law:

Section 5 of the Payment of Wages Act 1991 regulates where a deduction can be made from an employee’s wages. Specifically,  section 5(2), relates to a deduction made in respect of an act or omission of an employee, which is the relevant section for the facts of this case.

Section 5(2) PWA

An employer shall not make a deduction from the wages of an employee in respect of—

(a) any act or omission of the employee, or

(b) any goods or services supplied to or provided for the employee by the employer the supply or provision of which is necessary to the employment,

unless—

(i) the deduction is required or authorised to be made by virtue of a term (whether express or implied and, if express, whether oral or in writing) of the contract of employment made between the employer and the employee, and

(ii) the deduction is of an amount that is fair and reasonable having regard to all the circumstances (including the amount of the wages of the employee), and

(iii) before the time of the act or omission or the provision of the goods or services, the employee has been furnished with—

(I) in case the term referred to in subparagraph (i) is in writing, a copy thereof,

(II) in any other case, notice in writing of the existence and effect of the term,

and

(iv) in case the deduction is in respect of an act or omission of the employee, the employee has been furnished, at least one week before the making of the deduction, with particulars in writing of the act or omission and the amount of the deduction, and

(v) in case the deduction is in respect of compensation for loss or damage sustained by the employer as a result of an act or omission of the employee, the deduction is of an amount not exceeding the amount of the loss or the cost of the damage, and

(vi) in case the deduction is in respect of goods or services supplied or provided as aforesaid, the deduction is of an amount not exceeding the cost to the employer of the goods or services, and

(vii) the deduction or, if the total amount payable to the employer by the employee in respect of the act or omission or the goods or services is to be so paid by means of more than one deduction from the wages of the employee, the first such deduction is made not later than 6 months after the act or omission becomes known to the employer or, as the case may be, after the provision of the goods or services.

It is necessary to emphasise that the conditions as set out at (i) to (vii) above are mandatory and must all be met,  in order for a permissible deduction under section 5(2) to be made.

Application of section 5(2) to the facts:

Based on the evidence which as regards this complaint is largely not in dispute, I am satisfied that:

(i)                  The Complainant’s contract included a provision which permitted a deduction to be made from the Complainant’s wages in accordance with section 5 of the PWA 1991.

(ii)                The deduction that was made, was fair and reasonable having regard to the cost to remedy the damage

(iii)               The Complainant was on notice of the fact that clause in the contract which would allow the deduction to be made

(iv)               The Complainant was not furnished, at least one week before the making of the deduction the particulars in writing of the act or omission.

While I accept the Respondent’s evidence that he was sent a damage report form immediately following the complaint however, he was not furnished at least one week before the making of the deduction the amount of the deduction being made. This was not disputed by the Respondent witness. While the Respondent witness explained that this was because was because he believed that the Complainant should be paid wages that were owed to him on the last day of his employment, it does not explain why the particulars of the deduction was not provided at the earliest opportunity ie when he gave notice and or why the payment of his wages was not withheld for one week to allow compliance with the PWA.

As all the conditions set out in S.5(2) of the PWA are necessary to be fulfilled it is not necessary for me to now go through the rest of the section 5(2) criteria to determine if these were also met. If one of the section 5(2) criteria is not met, the law is clear, a wage deduction may not be made. 

As I am satisfied that the Complainant was informed of the deduction amount on the day that the deduction was applied, I am compelled to find that he did not receive “one weeks’ notice of particulars in writing of the act or omission and the amount of the deduction.”  

I find therefore that section 5(2) (iv) was not complied with by the Respondent and the mandatory wording of section 5 (“shall not make a deduction”) precludes me from upholding a deduction from the Complainant’s wages being made unless all criteria of section 5 (2) (i) – (iv) were satisfied.

Based on the above reasoning I find this complaint to be well founded.

I award the Complainant the sum of €491.73.

I find this complaint to be well founded.

I award the Complainant the sum of €491.73