PWD2528

PARTIES:

DIVISION:

SUBJECT:

Appeal of Adjudication Officer Decision No's: ADJ-00044419 (CA-00054950-001)

BACKGROUND:

This is an appeal of an Adjudication Officer’s Decision made pursuant to the Payment of Wages Act, 1991. The appeal was heard by the Labour Court in accordance with Section 44 of the Workplace Relations Act, 2015. 

The following is the Court's Decision.

DECISION:

Background to the Appeal

This is an appeal by Mr Robert Mikolajczyk (‘the Complainant’) from a decision of an Adjudication Officer (ADJ-00044419, dated 2 February 2024) under the Payment of Wages Act 1991 (‘the Act’). Notice of Appeal was received in the Court on 11 March 2024. The Court heard the appeal in Waterford on 7 February 2025.

The Complaint under the Act

The Complainant submitted a complaint under the Act which was received by the Workplace Relations Commission on 9 February 2023. He outlined his complaint as follows:

“I have not received the bonus payment due to me for the sales I made in the calendar year to 31st December 2021. This bonus payment is normally paid at the end of March the following year. Despite requests, my former employer has not paid the requisite amount.”

The Factual Matrix

The Complainant was employed by Musgrave Wholesale Partners (‘the Respondent’) as a Business Development Manager until his resignation took effect on 10 January 2022. His written contract of employment dated August 2018 provided for a bonus element to his remuneration as follows:

“Performance Incentive Scheme:

A Sales Performance related incentive will be paid on the achievement of agreed targets. This will change in line with the needs of the business each year. It is a requirement of this position that you meet or exceed targets on an ongoing basis in line with the needs of the company. The Incentive Structure for 2018 will be communicated to you by your Manager.”

It is common case that the Complainant tendered his resignation on 13 December 2021 and that the resignation was effective from 10 January 2022. Having submitted his resignation, the Complainant raised a query with his Line Manager, Mr Jason Finnegan, regarding his eligibility to receive a bonus payment for 2021. Mr Finnegan consulted with Ms Marta Hliwa, Head of Human Resources, and reverted verbally to the Complainant to advise that he would not be eligible for any bonus that fell due for payment after the cessation of his employment.

On 14 January 2022, the Complainant emailed Ms Hliwa in relation to the same issue. His email explicitly acknowledges his understanding that he would not be paid a bonus for 2021 in circumstances where his employment had ceased before the bonus became payable. Ms Hliwa replied on 21 January 2022 and stated:

“Hi Robert,

Happy new year and I hope you are keeping well.

Jason had informed me that he had spoken to you on this before your departure from the company and explained that you wouldn’t be eligible for payment as you would not be any longer an employee of the Company at the time of the bonus payment.

In relation to your email below, please be advised that a bonus is a discretionary payment awarded to colleagues who are still on payroll when the bonus is determined an paid, which usually happens in April.

As you are aware, you have also been awarded this discretionary payment in April each year in the past when you were here with the Company.”

The Complainant’s Solicitors submitted an initial complaint under the Act on 24 August 2022 seeking compensation of €9,481.00. This form requested that the complaint be referred to the Inspection Service of the Workplace Relations Commission. When the Complainant’s Solicitors enquired on 1 February 2023 as to when the complaint was going to be dealt with, they learned of the error that had been made in filing the original complaint form and submitted a fresh one dated 9 February 2023 without prejudice to their stated belief that the first form submitted was valid and within time.

Preliminary Issue

The initial complaint submitted by the Complainant’s Solicitors expressly requested that the complaint be referred for inspection. This cannot be retrospectively amended by the Court to read as a referral to the Adjudication Service.

The second complaint submitted under the Act was received by the Workplace Relations Commission on 9 February 2023. The cognisable period comprehended by that complaint is, therefore, 10 August 2022 to 9 February 2023. It is common case, that the disputed bonus payment, fell due for payment in March/April 2022 i.e. outside the period comprehended by the second complaint.

Reasonable Cause for the Delay

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

“(6) 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.”

Subsection (8) of section 41 states:

“(8) An adjudication officer may entertain a complaint or dispute to which this section applies presented or referred to the Director General after the expiration of 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 established test for deciding if an extension should be granted for reasonable cause shown is that formulated by this Court in Labour Court Determination DWT0338 Cementation Skanska (Formerly Kvaerner Cementation) v Carroll. Here the test was set out in the following terms: -

“It is the Court's view that in considering if reasonable cause exists, it is for the claimant to show that there are reasons which both explain the delay and afford an excuse for the delay. The explanation must be reasonable, that is to say it must make sense, be agreeable to reason and not be irrational or absurd. In the context in which the expression reasonable cause appears in the statute it suggests an objective standard, but it must be applied to the facts and circumstances known to the claimant at the material time. The claimant’s failure to present the claim within the six-month time limit must have been due to the reasonable cause relied upon. Hence there must be a causal link between the circumstances cited and the delay and the claimant should satisfy the Court, as a matter of probability, that had those circumstances not been present he would have initiated the claim in time.”

In that case, and in subsequent cases in which this question arose, the Court adopted an approach analogous to that taken by the Superior Courts in considering whether time should be enlarged for ‘good reason’ in judicial review proceedings pursuant to Order 84, Rule 21 of the Rules of the Superior Courts 1986. That approach was held to be correct by the High Court in Minister for Finance v CPSU & Ors [2007] 18 ELR 36.

The test formulated in Cementation Skanska (Formerly Kvaerner Cementation) v Carroll draws heavily on the decision of the High Court in Donal O’Donnell and Catherine O’Donnell v Dun Laoghaire Corporation [1991] ILRM 30. Here Costello Costello J. (as he then was) stated as follows:

“The phrase ‘good reasons’ is one of wide import which it would be futile to attempt to define precisely. However, in considering whether or not there are good reasons for extending the time I think it is clear that the test must be an objective one and the court should not extend the time merely because an aggrieved plaintiff believed that he or she was justified in delaying the institution of proceedings. What the plaintiff has to show (and I think the onus under O. 84 r. 21 is on the plaintiff) is that there are reasons which both explain the delay and afford a justifiable excuse for the delay.”

It clear from the authorities that the test places the onus on the applicant for an extension of time to identify the reason for the delay and to establish that the reason relied upon provides a justifiable excuse for the actual delay.  Secondly, the onus is on the applicant to establish a causal connection between the reason proffered for the delay and his or her failure to present the complaint in time. Thirdly, the Court must be satisfied, as a matter of probability, that the complaint would have been presented by the Complainant in time were it not for the intervention of the factors relied upon as constituting reasonable cause. It is the actual delay that must be explained and justified. Hence, if the factors relied upon to explain the delay ceased to operate before the complaint was presented, that may undermine a claim that those factors were the actual cause of the delay.  Finally, while the established test imposes a relatively low threshold of reasonableness on an applicant, there is some limitation on the range of issues which can be taken into account. In particular, as was pointed out by Costello J in the passage quoted above, a Court should not extend a statutory time limit merely because the applicant subjectively believed that he or she was justified in delaying the institution of proceedings.

The Complainant submits that his delay in initiating his complaint under the Act was due entirely to his Solicitors’ failure to correctly complete the first complaint form submitted to the Workplace Relations Commission. The Court accepts that the foregoing circumstances satisfy the requirements of the test set out in DWT0338 Cementation Skanska (Formerly Kvaerner Cementation) v Carroll. Accordingly, the Court accedes to the Complainant’s application to extend time and, therefore, deems that the Complainant’s referral to the Workplace Relations Commission on 9 February 2023 falls to be determined.

Discussion and Decision of the Substantive Issue

The bonus payment that is in dispute would have been paid to the Complainant on 14 April 2022 had he still been in employment as of that date. It will be recalled that the Complainant had tendered his resignation to the Respondent on 13 December 2021 and that his resignation was effective from 10 January 2022.

It is common case that there was an established practice where the Respondent paid out the annual bonus to employees in the April following the preceding calendar year as the Respondent’s accounts are not finalised for the preceding year until March and it is only then that it becomes known whether bonus criteria have been met.

The Court finds that the bonus for Year 2021 was not properly payable to the Complaint in April 2022 because he was no longer in the Respondent’s employment as of the date that that bonus became payable. The Court is satisfied that the practice at all material times is that the bonus is paid to those who are in employment when the bonus falls due to be paid. The evidence before the Court is that it was common knowledge that Respondent paid out the bonus in April each year to those in employment at that time and eligible to receive it. The Court is further satisfied that the evidence established that former employees, who may have achieved their targets in the relevant year, but who were no longer in employment when the bonus became payable and were not paid a bonus.

Finally, the Court is clear that the evidence establishes that the Complainant was aware of the foregoing practice, and that this had been confirmed to him by his line manager and by HR in and around the time of his resignation.

The appeal accordingly fails.

The Court so decides.

	Signed on behalf of the Labour Court
	Alan Haugh
AR	______________________
31 July 2025	Deputy Chairman

NOTE

Enquiries concerning this Decision should be addressed to Mr Aidan Ralph, Court Secretary.