Complainant

Respondent

Parties

Ian  Armstrong

Bankhawk Limited

Representatives

Eamonn Gibney HR Dept

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-00063516-001

16/05/2024

The Complainant submitted that he did not receive the commission due to him from the Respondent as provided for in his contractual arrangements and that he was owed for annual leave accrued at the time of the termination of his employment.

The Respondent rejected the complaint on the basis that the Complainant had revised contractual arrangements in place and on the basis that the Complainant was not solely responsible for the sales activity upon which he based his claim.  In that context, it was the Respondent position that the Complainant had overstated his claim for commission and that it had paid him the correct amount.  It was also the Respondent position that the Complainant did not have accrued annual leave.

The Complaint Form

In his complaint form, the Complainant submitted that he had been employed by the Respondent from 13 March 2017 and that as part of his package and as set out in his contract he was to be paid a bonus commission of 12.5% of related sales revenue.  He outlined that the CEO made a habit of seeking to delay commission payments for various reasons over the years of his employment and he noted that in an earlier effort to receive already outstanding pay he had agreed to reduce the commission rate to 10%.  He confirmed in his complaint that he had based his outstanding pay claim on that rate.

In his complaint form he outlined that by Q3 2023 his outstanding commission had accumulated to as much as €117,680 on the back of signing and successfully delivering 3 of the Respondents largest clients who generated over €1m in revenue for the Respondent. He outlined that despite this, the CEO still asked to defer receipt of commission as the Respondent wanted to raise investment.  He stated that it had become an issue for him and so agreement was reached to pay half of the amount due in Q4 2023 and the remainder in Q1 2024. He confirmed that he did receive €60,000 in Q4 2023 but that in January 2024 a redundancy process was commenced, and his employment was terminated on 11 March 2024.

The Complainant outlined that during numerous meetings and communications commencing on 12 January 2024 he raised the issue of a redundancy consultation while the balance of his commission of €57,680 remained outstanding and he received numerous promises and assurances that the commission would be paid.  The Complainant confirmed that his final payment from the Respondent was made on 10 April 2024 and that this payment only took account of his statutory redundancy entitlement and he outlined his confusion as to whether or not he had been paid for his arrears of commission or his statutory redundancy as he had not received a payslip.

He submitted that in addition to the arrears outlined above he had closed eight sales immediately prior to termination of employment, valued at €64,000, thus resulting in a further €6,400 of commission due.  He stated that in addition to the outstanding commission due to him, he was also due to be paid for untaken annual leave carried forward each year and he advised that payment for untaken annual leave should reflect commission payments per average week’s pay.  The Complainant outlined in his complaint form that he had not received payslips but that he had other documentation which would support his claim.

Complainant Submission

In his submission the Complainant advised that he started employment with the Respondent in 2017 initially as Business Development Lead but that this evolved into a wider client delivery role and commercial responsibilities which had elements of sales, marketing, finance, client consulting etc.   He submitted that he had a contract of employment from the outset and that some changes were agreed at a later date.  These changes related to a salary increase to €6,000 per month gross and commission percentage reducing from 12.5% to 10% in 2022.  He confirmed that while these changes were documented between the parties, new contracts were not completed.

The Complainant submitted that the outstanding wages at issue related to unpaid bonus after the Respondent CEO had requested, and he had agreed, to delaying commission payments owed at various times. The nature of the Respondent business meant that customers paid long after signing contracts with many based on a percentage of savings model i.e., receiving % of savings generated for clients through the services, such services taking months to deliver at times. He submitted that this meant that the parties would often have sight of large fees far into the future and so this arrangement was acceptable.   He submitted that by Q3 2023 after some very large successes and almost €1m collected from the Respondent’s largest clients in Q1 2023, his outstanding commission had risen to €117,680 and he outlined to the CEO that he needed to receive it.

The Complainant submitted that In August/September the parties agreed he would receive half (€60,000 gross on top of September payroll so €66,000 total) with the remainder to be paid in Q1 2024. This was to soften the impact of €117,680 on 2023 performance while the CEO had intentions/efforts for a fund raising from a position of strength.

The Complainant confirmed that he received the €60,000 of arrears commission in October 2023, however, on 8th January 2024, he was invited to a HR Meeting scheduled for January 12th, at which he was informed his role might be made redundant. The Complainant submitted that during that meeting he raised concern that he was owed arrears of commission valued at €57,680 with such a redundancy process due to start. He submitted that at the meeting of 12 January he was made multiple promises that he would be paid the outstanding commission. He provided a copy of a transcript of the meeting taken from a recording of the meeting which he proposed to bring to the WRC hearing. 

The Complainant submitted that despite those assurances what followed was three months of prevarication and delays, U-turns and attempts to have him sign various agreements which he was not prepared to do. In addition to many verbal commitments, the HR Advisor agreed to confirm the payroll point in the January 12th follow up meeting minutes, but this did not happen. The Complainant submitted that on 23 January he highlighted this and further raised concerns/risk of now irreparable relationship breakdown due to outstanding wages and that on 30 January he made a further request to get paid and highlight how distressing it was becoming.  Both communications were in writing.

At a meeting on February 12th, the Complainant submitted that he was informed of the decision to make his role redundant and again he received yet more reassurances he would be paid the outstanding bonus. He submitted that he then received a letter on 16 February confirming redundancy and informing him that he would finish work on 11 March and receive statutory redundancy and notice following his last day.

The Complainant submitted that, in tandem, he received a proposed “Settlement Agreement” which he appended to his submission. He outlined that the proposed agreement included waiving his rights to take a claim under the Payment of Wages Acts/other employment or WRC recourse options, and an enhanced NDA over that which he had signed when he started work with the Respondent. He submitted that he was not prepared to enter into such agreements and was unhappy with outstanding wages being used in such a manner. He further submitted that he was also required to agree to spread his outstanding wages over four months and that this is discussed in detail at the various meetings.

The Complainant outlined that on 11 March he confirmed by email that he did not agree to the settlement agreement as he was not willing to sign away his right to WRC claims/recourse rights in the event that he wasn't paid. He outlined that a further meeting took place on 26 March where it was agreed that he would receive statutory redundancy, outstanding pay, plus commission over four months without signing the settlement agreement. He submitted that on the same day he received another email confirming that he would receive statutory redundancy and notice pay on 27 March but that payment was not received. 

The Complainant submitted that on 28 March he sent a further email asking that his redundancy and notice pay due, now be paid and he also gave agreement to the Respondent’s request to split the outstanding bonus of €57,680 over four months but subject to receipt of a first tranche (€14,420) to be received with the March payroll run. The Complainant submitted that he did not receive any of those payments.

The Complainant submitted that he was again asked to sign an enhanced NDA and told he needed to do this to get the outstanding commission and on 8 April, he received a further email asking for an update on the NDA, having still not received any of the pay commitments outlined above.

In his submission the Complainant confirmed that he received payment of €9036 on 11 April, which he understood to be for statutory redundancy, but that he did not receive any of the outstanding wages owed.  The Complainant submitted that he wrote to the Respondent on 18 April confirming grievances and concerns with leapfrogging outstanding wages to redundancy pay and confirming NDA was not a valid reason for wages deduction/deferment. He confirmed that since then he has not received any replies or any of the outstanding pay.

In his submission the Complainant also included the holiday pay calculation and indicated that he had used the average working weekly pay calculation method, which he submitted, since he was not paid commission owed, or previously had holiday pay which factored bonus, he couldn’t have received accurate amounts.  He submitted that he calculated this conservatively at just three weeks total (under his contract he was entitled to five weeks holidays per year which were never fully used).

In summary, the Complainant sought payments as follows:

●       €57,680 for outstanding unpaid bonus

●      €17,464 for related unpaid holiday pay

●      €6,400 for final sales to universities

Hearing 26 August 2024 – Preliminary Issue

In relation to the Respondent position that the complaint was out of time, the Complainant stated that when he raised the matter of his outstanding commission in September 2023, he was not making a “confrontational Claim” on the Respondent, rather he was merely prompting the Respondent that the monies were due.  He stated that agreement was reached to pay half in Q4 2023 and the remaining amount by end of Q1 2024.  He stated that he felt confident that the monies would be paid because of the agreement reached and because of the large profits being paid at that time.  He stated that he had no reason to make a complaint to the WRC until he received his final payment in April 2024 which did not include payment of his outstanding commission and annual leave.

Hearing 26 August 2024 – Substantive Issue

At hearing the Complainant summarised his complaint as set out in his submission.  In addition, he stated that BW had advised him that he had mislaid the Complainant’s contract of employment which he had signed on 13 March 2017.  He rebutted the Respondent position that he had never returned a signed copy of the contract and stated that he had sat with Mr. L’s brother and signed the original contract in the office.

He stated that he could not sign the new NDA as it gave power of attorney to the Respondent, that he had family responsibilities and that he could not hand over such powers to the Respondent.  He also expressed concerns that he was being asked to sign away his right to take a complaint in circumstances where payments due to him had not been made.

In relation to the taking of annual leave the Complainant clarified the calculation of payment for annual leave was based on his salary plus commission.  He confirmed that he had carried forward 5 days into 2023, that he had taken 5 days over Christmas 2023 and 5 days for Q1 of 2024.

In relation to the claim for commission payments outstanding for sales immediately prior to termination of employment the Complainant submitted that there was no conversation in relation to rates since the discussions that had taken place in 2022.  As part of those discussions the provision in the contract which had provided for 12.5% for individual sales commission and 7.5% for team sales commission had been revised to a flat rate of 10% for all sales commission and the Complainant provided documentary evidence of the revised agreed rate.

Post hearing submissions

At hearing on 26 August 2024, the Complainant entered the following emails into evidence:

·       Email of 25 February 2017 from BW to the Complainant

·       Email of 13 March 2017 @ 7.58 am from the Complainant to JW (cc’d BW)

·       Email of 13 March 2017 @ 8.00am from BW to the Complainant (cc’d  JW)

·       Email of 13 March 2017 @ 11.38 am from JW to the Complainant (cc’d BW)

The Complainant had advised that the above documents demonstrated that the Respondent was, at all relevant times, in possession of the details of the contract of employment and that specific negotiations had taken place regarding a change from Partner Sales to Assist/Team Sales and the inclusion of a sentence referring to “Customised Assist/Team sales commission arrangements may be agreed on an individual basis” to the contract terms. 

The above emails had not been presented in the Complainant submission and in that context, I gave leave to the Respondent to submit a written response to those matters by 5 September 2024.

Complainant Replying Submission 30 September 2024

The Complainant submitted that the Respondent, in its’ submission of 5 September, was making up new excuses for not paying the outstanding wages and that it appeared that each of those reasons as outlined at the hearing (i.e., lost NDA, 7.5% team sales not 10% or 12.5% per contract/agreement, misleading the company for personal gain and refusing to sign settlement agreement/NDA’s etc.), having been disproven were now being set aside.  The Complainant noted that the Respondent now contended that actually he (the Complainant) had agreed to 0% commission in 2022. The Complainant submitted that, for the avoidance of any doubt, he absolutely did not discuss or agree to 0% commission in the 2022 meeting where the commission was reduced from 12.5% to 10%, and noted that this was not what the email actually conveyed.

The Complainant noted the reference to “Full and final settlement” relied upon by the Respondent and submitted that it was very clearly referring to payments due to 31st July 2022 as outlined in the same sentence and not to other sales. The Complainant drew attention to the testimony given under oath by Mr.BW at hearing, the earlier submission from Respondent and his own original submission in this regard.  He suggested that the Respondent was “clutching at straws” in trying to retrospectively create an alternative narrative and he noted that the Vodafone contract which he stated the Respondent was now trying to suggest as a singular ‘sale’ closed in 2018 for Vodafone Ireland and in 2020 for Vodafone UK, and that the documentation submitted was simply screenshots from the Docusign confirmation of the framework agreements. He submitted that like any common framework agreement with large enterprises, they govern the relationship between the parties but explicitly do not result in any purchase commitment, order volume, invoice or indeed payment commitment in their own right, i.e., they were not the ‘sale’ closed. He submitted that extracts from the contract confirmed very clearly that Vodafone “may purchase,” that it was a framework and no commitment was entered into until purchase orders were issued i.e., sales are made. He submitted that the subsequent Vodafone purchase orders, the related projects (Bankhawk services) and Bankhawk invoices, along with chasing of payments were all overseen by him at the agreed 12.5% and 10% commissions. 

The Complainant appended extracts from the Framework Agreement, and copies of the later invoices to his submission to support his position

Complainant Replying Submission 11 November 2024

In relation to the Respondent position that €60,000 had been paid to the Complainant to assist him with property purchase the Complainant submitted that this was “an outright lie.” He submitted that the amount agreed owed was €117,680 but of this, €46,780 was from 2022. He drew attention to the email in question (which reduced commission to 10%) and noted that he was supposed to be paid €59,064 by July 31st 2022 but that he did not receive that payment but then received only €27k in September 22. He noted that the Respondent was now trying to suggest that he sought €60,000 at ‘short notice’ despite this being over a year later and that it was goodwill on the part of the Respondent in agreeing to the payment.  The Complainant submitted that this was “absolutely false.” The Complainant remined the Adjudication Officer of what he described as “the previous false position (that 10% was only agreed because they lost the contract and I tricked them)” and he posed the question, “So which is it? I tricked them and they agreed, they agreed but didn’t notice it was wrong until 2024 or it was goodwill to help me out”.

The Complainant submitted that the Respondent appeared to be trying to take advantage of some wording in an email where he mentioned he was afraid of losing a site. He submitted that in fact he was trying to appeal to Mr. BW to pay him and he noted that he did in fact lose out on the purchase.  The Complainant drew attention to linkages on that email that showed that the parties actually had a meeting in relation to the payment and submitted that this demonstrated that the suggestion that this was a request at short notice was factually incorrect.  The Complainant also referenced the email of 31 August 2023 (from original submission) which referenced to the email as a reminder email and where he reminded Mr. BW of the agreement to pay €60,000. The Complainant also submitted that if at any time Mr. BW had made a ‘settlement agreement’ in the year before reducing his commission to zero, it would have come up and he certainly wouldn’t have paid him €60,000.

The Complainant further submitted that the email was a note of a meeting, at which the parties agreed commission due to July 31st 2022. He noted the email title/subject as “Call re Employee Commissions Bankhawk Services”, and the text which stated “following the meeting the day before on 28th where we discussed the commissions I was owed”.   He noted that at that meeting Mr. BW sought to confirm commission due and the invoices paid list (at the original 12.5%) and submitted that the parties agreed during the meeting to reduce to 10% future receipts and future sales. He submitted that the suggestion that he would agree to no more commission on Vodafone deals was illogical and that the further suggestion that the purpose was to incentivise new sales was equally illogical. He noted that he was already contracted at 12.5% and posed the question “what possible incentive could be added by reducing commission both to 10% for future receipts/sales and reducing Vodafone pending sales to 0%, especially when we had sight of €700k to €1m in Vodafone receipts pending”.

The Complainant drew attention to the fact that both he and Mr. BW jointly explained at the hearing that the parties agreed he would get paid on Vodafone (and other) payments after receipt. He submitted that the Respondent proposition that Vodafone was one simple sale in 2018 so no commission due was totally incorrect and he submitted that the ’sale’ as it pertained to his commission, spanned the Framework Contract, SoW, delivery of the services over years and associated PO, Invoice documents and finally but crucially the Payment Receipt

In conclusion the Complainant referenced the Respondent closing statement and noted that Mr BW had already testified that the commission was postponed. He noted that the Respondent had supplied a list of invoices which clearly confirmed that commissions had been postponed. He submitted that the €60,000 he was paid in October 2023 comprised mostly commission from 2022 (€47,780).

Outstanding commission payments

In its submission the Respondent outlined that it is an Irish advisory firm that was established to help companies to optimise their banking and payments activity. It typically works with larger companies with high volumes of banking and payment transactions. It has 5 employees.

Throughout much of its submission the Respondent referred to the “Respondents claims” and attributed actions and opinions to the Respondent that within the sensible reading of the submission was clearly intended to refer to the Complainant.  I have reflected that interpretation in the following account of the Respondent submission.

The Respondent submitted that the Complainant commenced employment with the company under a contract of employment on 13 March 2017 as a Business Development Lead and that part of the contract was an undertaking regarding intellectual property, confidentiality, non-compete and non-solicitation (the NDA) which accompanied his contract. Following a review of the company operations, and a change in where the sales would be targeted, the Complainant was made redundant with notice effective date 11 March 202, notice was given on 12 February 2024 and the Complainant was paid in lieu of his notice. His last day of employment was 11 March 2024.

The Respondent noted the Complainant claims regarding deduction of wages where the Complainant cited: “However, by Q3 2023 after some very large successes and almost €1m collected from our largest clients in Q1 2023, my outstanding commission had risen to €117,680 and I outlined to the CEO that I needed to receive it as we risked losing trust and falling out etc.” The Respondent submitted that the Complainant was paid some commission in October 23 and could have raised a claim within the six months’ time limit, stating that “he was raising concerns about it and could have raised a claim then.”  The Respondent further submitted that in January and up to March, the company asked the Complainant to obtain legal advice and he didn’t do this, even though the company was going to pay for it and the Respondent noted that the Complainant could have submitted a claim then.

The Respondent noted that €742,000 (excluding VAT) was collected from a large client in March 23 and June 23 based on services delivered over a 5-year period and that the company incurred significant losses on this work. The Complainant was paid €60,000 sales commission in September 2023. (8.1% = an overpayment of €4350) 4 The Complainant submitted email evidence of his claim for commission on 7th September 2023, almost 8 months before he submitted his claim. The company reiterated to the Complainant that the NDA was vital to the company. Further on 28th March, the Complainant wrote, separate to the above stating “then I propose we explore any enhanced NDA or indeed final settlement/no claims type agreement you seek but we do this after receipt of my final pay, i.e., my outstanding commission and statutory pay has not then been used unfairly.” This proposal was not acceptable to the company, as the Respondent would have no leverage of any kind then to rely on getting the NDA signed, and the Respondent outlined that the Complaint was clearly using that as leverage to force his way. The Respondent submitted that it was the company’s view if he didn’t accept, he was contractually bound by the NDA, then he couldn’t rely on his contract to claim commission as they were included and dependent on adherence to the contract.

In addition, the Respondent submitted that it was its position that the Complainant was not willing to abide by a requirement in his contract of employment, namely the NDA and had therefore repudiated his contract and therefore ALL of its terms, including the commission agreement.

The Respondent submitted that it was its position that the claim was out of time. The Respondent noted that the Complainant stated in his submission that the payment was outstanding as of Q3 2023, i.e., July to September 2023 inclusive and noted that his claim was submitted more than six months after this date. He was paid €60,000 commission in October 2023, again, his claim was submitted more than six months after this date. the Respondent drew attention to Section 6.4 of the Payment of Wages Act, 1991, which states, “A rights commissioner shall not entertain a complaint under this section unless it is presented to him within the period of 6 months beginning on the date of the contravention to which the complaint relates or (in a case where the rights commissioner is satisfied that exceptional circumstances prevented the presentation of the complaint within the period aforesaid) such further period not exceeding 6 months as the rights commissioner considers reasonable.”

The Respondent submitted that the Complainant employed primarily as a sales lead and that in 2023 he made no sales whatsoever and the Respondent became frustrated in trying to deal with him. The Respondent submitted that the Complainant

·       Frequently didn’t attend scheduled meetings for a litany of last-minute personal reason

·       Submitted when pressed a cut and paste copy of an online sales plan for the yea

·       Was difficult to reach and pin down on any situation

·       Refused to perform reasonable tasks requested of him

·       Falsely claimed he had made two sales to 2 named clients, which never materialised

·       Stated that he had moral reservations about the company’s offering when pressed about sales development

The Respondent submitted that the lack of sales put the company under immense financial pressure and that the Complainant was offered a settlement agreement prior to being made redundant, that he was specifically asked to get legal advice on this, and he did not do this. The Respondent submitted that the Complainant refused to furnish the Respondent with a copy of the NDA he had received as part of his contract, saying he didn’t have a copy of it. When the company sent him an unsigned copy, he would not sign it stating that it was different to the previous one he was sent.

The Respondent noted that in the contract that was provided to the Complainant it stated the following in relation to Intellectual Property etc: “the Company has adopted the attached rules concerning Intellectual Property, Confidentiality, Non-Complete and Non-Solicitation.  You are bound by and must comply with these rules at all times.  You will be informed of any additions or amendments to these rules from time to time, as adopted by the Company.  Please sign both copies of the Undertaking and return one copy to Human Resources.”  The Respondent submitted that, at the date of termination and before, the Complainant  relied on the contractual clause regarding commission but was not willing to be bound by the clause above and that due to the Complainant’s previous remarks about having “moral reservations” about selling the company products, and the lack of results in 2023, the difficulties in reaching the Complainant or getting him to do tasks, the Respondent was worried that perhaps he was working on another venture or that he might bad-mouth the company following his redundancy. In that context the Respondent submitted that the NDA was very important to the company to protect itself from any untoward or competitive hits following the Complainant’s redundancy. The Respondent submitted that it is its ’position that the contract and the IP, Confidentiality, Non-compete and Non-solicitation Undertaking are mutually reliant and that as the Complainant did not accept, he was bound by one, he cannot claim to benefit from the other, essentially, he repudiated the contract by not signing the agreement.  The Respondent submitted that this was explained to him and yet “he still dodged and delayed communications to a frustrating degree.” The Respondent submitted that it is very concerned about its contractual commitments to its clients and shareholders regarding confidentiality, intellectual property rights and non-disclosure. The Respondent further submitted that the failure of the Complainant to formally acknowledge his responsibility as an ex-employee of the company to these commitments was very concerning for the company.

In relation to the amount of €70,900 claimed by the Complainant, the respondent noted that this was calculated using the incorrect percentage of 10%, that it should have been 7.5% as per his contract as all of the sales activity on these were team sales, with email evidence produced to show, that the company had established deep relationships with these clients prior to the complainant being employed. The correct rate should have been 7.5%.  The Respondent submitted that this came to light after the redundancy when the company started to look at what documents it had in order to establish the validity of the Complainants claims. The Respondent confirmed that it had offered him his original amount claimed in return for the confidentiality agreement, as this was crucial to the wellbeing of the company but that he did not sign it.

The Respondent submitted that when the Complainant was asked for a copy of his contract, he sent in two pages of it, crucially omitting the section dealing with commission. Discussions were ongoing with the clients regarding payment of invoices and the Complainant was holding these over the company, and manipulated the situation to his benefit, by claiming he was due 10% of sales going forward when it was a 7.5% rate he was entitled to. The company were willing to pay the outstanding commission in return for the signed and agreed NDA which formed part of his contract. In the proposed settlement agreement, the Complainant was advised to get legal advice on the agreement from a solicitor and the company would pay for this. He failed to do this and mistakenly concluded that signing the agreement would remove his right to raise a WRC claim if the company did not honour the agreement and pay his commission. As can be seen in the proposed agreement, the basis of the agreement was that the company would pay the commission on the basis of receiving the signed agreement which was sought to protect the company’s interests. The Complainant did not take legal advice and refused the agreement and the NDA, and at this point the trust and confidence in him was gone. As a result of the above, the company was reluctant to pay his commission as his refusal to be bound by the NDA or demonstrate that he would comply with its terms essentially negated his contract, including the commission terms. The Respondent noted that the Complainant reiterated this position a number of times, as late as April 2024, effectively repudiating his contract.

The Respondent summarised its position in relation to outstanding commission payments as follows:

·       The claim is out of time. The Complainant was paid in October and monies were outstanding to him then, he didn’t raise a claim within the six-month time limit.

·       The claim is invalid as the Complainant repudiated his contractual terms by refusing/not signing the NDA. Here the contractual terms are quite clear, the Complainant is to be bound by the undertaking, he would be informed of any amendments to the rules from time to time, one copy to be returned to the employer. His objections to signing the NDA sent to him coupled with the disparaging comments nullified the contract, including the commission clause. Essentially, this clause is a 2-condition precedent

·       The calculations made are incorrect. In July 22, when the Complainant failed to provide a copy of his contract and was negotiating with clients for payment, he misled the company into the commission payable to increase his gain. As can be seen in the contract, the correct rate ought to have been 7.5% not 10% or 12.5%. His outstanding commission is €14,341 and not €57,678.

·       In the interest of equity and good faith the company tried many times to get compliance from the Complainant in this regard and urged him to take legal advice that they would pay for, so he could sign the NDA and receive his commission.

·       It was only on receipt of the WRC complaint from that the company dug deeper and analysed what commission he was actually due.

·       For the employee to benefit from the positive aspects of his contract of employment while at the same time refusing to be agreeable or bound by the contractual restrictions contained in the NDA (and confirming this in writing to the company) would be against all principles of equity and good faith.

Outstanding Holidays

The Respondent submitted that for clarity and on a preliminary point of law, the claim raised is under the Payment of Wages Act, and not under the Organisation of Working Time Act. The respondent further submitted that, where an employee's rate of pay does not vary in relation to work done (i.e., salaried employees), the rate of pay shall be the sum, including any regular bonus but excluding overtime, that is paid in relation to the normal weekly working hours last worked by the employee before the annual leave. Commission was not regularly paid to the Complainant, it was earned on results and occurred only twice in his 6 years employment with the company. In this context the Respondent contended that his holiday pay would be his salaried amount. The Respondent submitted that the Complainant’s contract of employment states:

“In addition to statutory Public Holidays, you will be entitled to 25 working days annual leave per annum rom to be taken at such times as is agreed with you.  Pro rata leave will be granted in the first year of service.

The holiday year runs from January to December and you are required to take your full entitlement during the calendar year.  Unused holidays may not be carried forward from one year to the next unless otherwise agreed with the Company inwriting.”

The Respondent submitted that the Complainant was being flippant with his submission regarding holidays for 2023 and cited an example of what the Respondent described as “his haphazard last minute email” where the Complainant had booked leave and on the morning of it starting, he emailed to try to cancel it, due to bad weather, which was not agreed. The Respondent noted that in this instance one week of leave was availed of.

The Respondent further noted that the Complainant was on leave for two weeks before he was made redundant on 12 February 2024., in addition to which the entire company was on leave for the week of Christmas to the New Year every year.  The Respondent submitted that this demonstrates the Complainant availed of his 25 days annual leave.

The Respondent provided copies of emails relating to leave arrangements and cited case law in support of its position.

Hearing 26 August 2024 – Preliminary Issue

At hearing the Respondent Representative confirmed that circa September/October 2023 a discussion took place between the parties in relation to the shortfall in commission.  He submitted that it was evident to the Complainant at that time what the shortfall was and that he had an obligation to lodge his complaint at that time.    He stated that this position was clear 8 months prior to the submission of the Complainant’s complaint to the WRC.  In those circumstances he contended that the Complaint was out of time.

Hearing 26 August 2024 – Substantive Issue

The Respondent summarised its position as outlined in its submission and reiterated that the Respondent had been agreeable to pay the amount due subject to the Complainant signing the NDA and that he would not do so. The Respondent expressed how important the NDA was in terms of client confidentiality and in terms of the Company reputation, particularly in circumstances where the Complainant was raising issues of morality.

In relation to the annual leave payments the Respondent noted that all the evidence showed that the Complainant had availed of 48 days annual leave.  The Respondent contended that the Complainant had no entitlement under contract to carry over untaken annual leave from one year to the next, and that in fact, the contract explicitly prohibited such arrangements without prior approval in writing.  In addition, the Respondent argued that the calculation of payment for annual leave should not in these circumstances include the payment of commission.  The Respondent noted that the commission earned by the Complainant was not earned on a regular basis and had only been paid twice in 6 years.

The Respondent drew attention to the Complainants additional claim for commission on sales he considered to be finalised immediately prior to the termination of the Complainants employment.  The Respondent submitted that a review of those claims revealed that those sales had all the characteristics of a team sale and that team sales attracted commission at the rate of 7.5% and not 10% as claimed.  The Respondent noted that other team members had been paid team commission of those sales and that the claim submitted by the Complainant was based on false figures presented by the Complainant.

Post hearing submissions

At hearing on 26 August 2024, the Complainant entered the following emails into evidence:

·       Email of 25 February 2017 from BW to the Complainant

·       Email of 13 March 2017 @ 7.58 am from the Complainant to JW (cc’d BW)

·       Email of 13 March 2017 @ 8.00am from BW to the Complainant (cc’d  JW)

·       Email of 13 March 2017 @ 11.38 am from JW to the Complainant (cc’d BW)

The Complainant had advised that the above documents demonstrated that the Respondent was, at all relevant times, in possession of the details of the contract of employment and that specific negotiations had taken place regarding a change from Partner Sales to Assist/Team Sales and the inclusion of a sentence referring to “Customised Assist/Team sales commission arrangements may be agreed on an individual basis” to the contract terms. 

The above emails had not been presented in the Complainant submission and in that context, I gave leave to the Respondent to submit a written response to those matters by 5 September 2024.

Respondent Post Hearing Submission 5 September 2024

In its post hearing submission, the Respondent confirmed that it accepted that the emails provided by the Complainant showed different versions of the contract of employment.  The Respondent submitted that recent searches on the company system identified several copies of tracked changes only, and that it could not find a copy where all changes had been accepted and the documents signed.  The Respondent confirmed that the last NDA sent to the Complainant was “corrupted” and missing the reference information when it was sent be email in early 2024 with the proposed settlement agreement and the Respondent noted that it still had no signed copy of the original NDA.

The Respondent accepted that the new agreement between the Complainant and the Respondent on 29 July 2022 superseded the terms of the original contract and noted that the agreement was sent to the Complainant on 29 July 2022 and that the Complainant confirmed his acceptance of those terms by return email on the same day.  The Respondent noted that the Complainant had cited the agreement in relation to the discussion about the applicable percentage of commission due (i.e., 7.5%,10% or 12.5%).

The Respondent noted that the agreement was as follows:

“Total Sales Commission of 12.5% (€73831) will apply to the following receipts:

Vodafone Ireland €141,854

IUA €150,000

Vodafone UK €298,791

Total €590,645

10% (€59,064) will be payable before 31st July

2.5% (€14,766) will be payable on the receipt of the next €200,000 (or Sterling equivalent) of funds from Vodafone UL & (the complainant) up to 31st July 2022 and is in full and final settlement of same

Sales commission of 10% will apply to receipts from other future Vodafone sales of (the Respondent) services generated by (the Complainant)

Sales commission of 10% will also apply to receipts from other future new sales of (the Respondent) services generated by (the Complainant).”

The Respondent submitted that it was its position, on reflection, that the commission paid to the Complainant on 28 September 2022 (€27,049) and 2 October 2023 (€60,000) was in compliance with that agreement and was in full and final settlement of all commission due up to 31 July 2022, and indeed up to the Complainant’s termination date, as no more sales were closed pending that agreement except for the €6000 sale to IUA.  The Respondent submitted that all other sales the Complainant claimed he was due commission on were concluded prior to the date of the new commission agreement.

In conclusion on this matter, the Respondent submitted that the Complainant was not entitled to any further commissions as no new sales were generated except the one for €6000 referred to above.  The Respondent provided a list of sale closure dates to support its position.

In relation, to the Complainants claim for payment of annual leave outstanding at the time of the termination of his employment the Respondent made a brief submission and provided a list of dates when payments were received by the Company to demonstrate that the payment of commission was not a regular feature of the Complainant’s salary.

Respondent Submission 22 October 2024

The Respondent submitted that at very short notice and without any discussion the Respondent sought a payment of €60,000 saying that he needed the funds immediately to make a bid on a house site and that in good faith, the payment was included by the Respondent in the payroll as requested. The Respondent further sub mitted that the Complainant now seemed to be trying to capitalize on the goodwill of Respondent and that given how difficult the behaviour of the Complainant had become throughout 2023, the Respondent was happy to make a further payment in 2024 as part of a settlement just to limit the reputational and other damage which was being caused to the business by the Complainant.

The Respondent noted that The Settlement Agreement reached on 28 July 2022, as produced at the hearing, was unequivocal and submitted that the purpose of that agreement was to incentivize the Complainant to generate new sales to other VF operating companies as new sales had dried up. The Respondent drew attention to a presentation for a new sale to VF Romania which the Complainant had submitted the day before the agreement was made and appended a copy of same.

The Respondent submitted that the VF sales were made when the Customer executed the contracts in 2018 and 2020 respectively, stating that both contracts contained a Statement of Work (SOW) which defined the services that were to be provided and so constituted the sales. The Respondent appended copies of same to its submission and noted that these services commenced in 2018 and 2020 shortly after both contracts were executed. The Respondent submitted that to suggest there were new VF sales post the settlement on 28th July 2022 was “fanciful.” The Respondent submitted that the SOW (Statement of Work) in each case absolutely refuted the claim by the Complainant that these were merely ‘framework’ contracts and that the subsequent purchase orders following the completion of the work were requested by the Customer (VF) simply to facilitate the processing of the payments. The Respondent drew attention to copies of their email exchanges with the customer (VF) where they themselves argued that P.O.s were not required as the contracts already contained a Statement of Work.  Accordingly, the Respondent outlined that it was the position of the Respondent that the Complainant has been overpaid by €12,621

The Respondent noted the extracts provided by the Complainant from the Framework Agreement and submitted that these were standard Customer (VF) contract terms. The SOW (Statement of Work) was agreed and in each case was actually included in the agreements and noted the wording in the contract extract 6 which confirmed that “VF shall when it wishes to procure from Supplier in this category, agree a SOW (where applicable) with supplier. No commitment is entered into until there is (i) an agreed SOW”.  The Respondent submitted that the evidence provided by the Complainant confirmed that by agreeing a SOW (Statement of Work) the customer (VF) has agreed to procure the services outlined in the SOW, and so this constitutes the date of sale.

In relation to the invoices provided by the Complainant the Respondent submitted that to suggest the sale date for VFUK is January 23rd 2023 is incorrect. The sale was made when the contract and SOW was agreed in 2020, the work commenced in 2020 and an invoice was raised and sent to VFUK on 21st December 2022

In relation to the invoices provided by the Complainant the Respondent submitted that to suggest the sale date for VFI is January 23rd 2023 is incorrect. The sale was made when the contract and SOW was agreed in 2018, the work commenced in 2018 and an invoice was raised and sent to VFUK on 21st December 2022

The Respondent submitted that it never agreed to the postponement of the commission, they simply paid €60,000 in lieu of assumed commission out of good will and in good faith to try and help the Complainant procure a house site

The Respondent provided copies of emails, invoices and Statement of Work Agreements to support its position

Preliminary Issue

I have considered carefully the respective positions of the parties and have reviewed all relevant documentation.  I consider it necessary to examine the components of the Complaints case separately:

·       Time line in relation to the claim for payment of outstanding commission

·       Time line in relation to the claim for payment in lieu of outstanding annual leave

In relation to the claim for payment of outstanding commission I note that it was common case at hearing that agreement had been reached circa October 2023 in relation to the payment of these monies and that the agreement provided for payment of the monies due in two phases, the second payment being due by end of Q1 2024.  On that basis it is clear to me that this payment should have been paid by 31 March 2024 and in those circumstances, it is abundantly clear that the Complainant was free to submit his complaint in this respect during the 6-month period thereafter. I note that the Complainant submitted his complaint to the WRC on 16 May 2024 and therefore I find that this element of his complaint is within time.

In relation to his complaint for payment in lieu of outstanding annual leave I note every employer has an obligation to make payment in lieu of annual leave outstanding at the time of termination of employment.  In this instance the Complainant received his final payment from the Respondent on 11 April 2024 and submitted his complaint to the WRC on 16 May 2024, therefore I find that this element of his complaint is within time.

The Substantive Issue

In considering this matter I took into account the information supplied in the Complainant’s complaint form, his submission and supporting documentation.  I also reviewed and considered the Respondent’s written submissions and other supporting documentation. In addition, I considered the information and evidence provided by the parties at the hearing, together with representations made on behalf of the Respondent.

I note that there are 3 elements to the Complainants claim as follows:

1.     Claim for payment of outstanding sales commission

2.     Claim for payment of additional sales commission

3.     Claim for payment in respect of outstanding annual leave

Claim for payment of outstanding sales commission

I noted the Complainant position that he was owed €117,680 of which he was paid €60,000 in Q4 2023.  I noted that he alleged he was due to be paid the balance of €57,680 by end of Q1 2024 and that the payment was never received.  I noted that the Complainant based this amount on an agreement which he contended was reached on 2022 to pay his commission at the rate of 10% and I noted that the Complainant submission, his evidence given under oath at hearing and his subsequent submissions post hearing were all consistent in this regard.

I noted the Respondent positions in its original submission and in evidence given under oath at hearing as follows:

·       That the Complainant’s contract provided for both an NDA and the payment of commission and that as he would not sign an NDA he had, in fact, repudiated his contract

·       That there were various performance issues of concern to the Respondent and that the agreement entered into in 2022 in relation to his commission was intended to incentivise his performance

·       That the Complainant had withheld a copy of the full contract from the Respondent and had therefore manipulated the Respondent into agreeing commission that was overstated

I noted that the Respondent put forward alternative positions in its post hearing submissions, instead contending that the agreement entered into in 2022 was in full and final settlement of all claims and that, in fact the Respondent had overpaid the Complainant the amount due.

In considering the above positions I noted that there was clear evidence that the rate of 10% was a rate agreed between the parties in 2022 and that this agreement amended the rates previously agreed in contract. Although the Respondent appeared to resile from wishing to apply 10% commission to all sales Mr. BW did not dispute that this agreement was reached.  Rather he indicated that it was agreed in the context of him not having a copy of the contract available to him and his view that the Complainant had not returned the contract.  However, it is clear from the evidence of the Complainant and from the Respondent submission that the Respondent ultimately found a copy of the contract which was appended to its submission.  The documentation provided by the Complainant clearly shows that such agreement was reached and whether or not the Respondent remained satisfied with that agreement it is abundantly clear that the agreement was in place and superseded the terms of the contract.  On that basis I accept the Complainants account that the value of the commission outstanding was correctly based on 10% commission.

 I noted also that the Complainant had accepted a deferral of the payment of this amount and had reached agreement that the outstanding commission would be paid in two tranches, one in Q4 of 2023 and the second by end of Q1 of 2024.  It is common case that the 50% due in Q4 of 2023 was paid and that the remaining 50% due in Q1 of 2024 was not.  There are numerous emails where the parties refer to these matters as fact. 

I noted the change in the Respondent position that the money was not due and had, in fact been overpaid and in truth I find this to position not be credible.  Throughout the hearing and in its original submission the Respondent acknowledged that the monies were due to be paid and relied on the failure of the Complainant to sign the NDA as the basis for not making the payment.  The Respondent in its final submissions is asking me to accept that it was the case that it paid the Complainant €60,000 just to assist him in buying a site and that in so doing it had overpaid him the commission due.  It is also asking me to accept that the full and final component of that settlement related to all Vodafone sales not just those that were outstanding at the time the agreement was reached in 2022.  I do not find this dramatic change in position to be in any way credible.

I respect and acknowledge the concern of the Respondent in relation to not having a signed NDA in place with the Complainant, however, that cannot be used to excuse the non -payment of monies owed.  Nor can it be said that by not signing a new NDA the Complainant has in some way broken the terms of his contract.  It is evident that the Respondent did not have proper procedures in place for the management of relevant employee documentation and this responsibility cannot be shifted to the Complainant.

Taking all of the above into account I find that the Respondent has not paid the Complainant the sum of €57680 in respect of payment of outstanding sales commission.

Claim for payment of additional sales commission due

I noted the Complainant’s position that he was owed €6,400 in commission payments arising from €64,000 of sales finalised prior to termination of his employment. 

I noted the Respondent position that some of those sales were made by the team rather than the Complainant on an individual basis and that some of those sales had also not fully materialised.

In considering this matter I took into account the agreement reached between the parties in 2022.  It is evident that pre that agreement the Complainant was entitled to commission of 7.5% on sales that were team generated and 12.5% on individual sales.  However, the agreement reached made clear that ALL sales would now attract a 10% rate of commission.  On that basis I consider that the Complainants calculation of the amount of commission, based on sales of €64,000 is correct at the amount of €6,400.

While the Respondent submitted that some of the sales involved had not fully materialised it did not provide any clear evidence to substantiate that position.

In the context that the Respondent had access to all relevant documentation if that position were correct, it should have been possible and indeed, relatively easy for it to have done so.

Based on all of the above I find that this element of the complaint is well founded.

Claim for payment in respect of outstanding annual leave

I noted the disparity in the respective positions of the parties.  I noted the Complainant position that he was owed 15 days holidays and that payment for same should be calculated on the basis of his substantive salary plus bonus.

I noted the Respondent position that the claim was under Payment of Wages Act and not the organisation of Working Time Act but that in any event the sales commission was not a regular feature of the Complainants salary. I noted further the Respondent position that the Complainant had availed of his annual leave entitlement in 2024 and that based on his contract of employment he had no entitlement to carry forward untaken annual leave from one year to the next.

I noted that the Respondent had provided a copy of the original contract of employment and I noted the clause relating to annual leave which explicitly confirmed that “unused holidays may not be carried forward from one year to the next unless otherwise agreed with the Company in writing.”

On that basis it is clear to me that the Complainant does not have a valid claim in relation to any annual leave prior to 2024.  I noted that the Complainants annual leave was 25 days per annum and that his employment terminated on 11 March 2024.  In that regard I calculate his annual leave entitlement up to the date of the termination to be 5.3 days.

I noted that neither party provided clear details of the taking of annual leave and in that context, I am not able to say with any degree of certainty whether or not the Complainant did avail of his annual leave entitlement prior to termination of his employment.  I noted the Respondent position that the Complainant was haphazard in how he took his annual leave and it is evident to me that this could also properly describe the Respondents management and recording of such leave.  The Respondent should note his obligations to record such information in accordance with the Organisation of Working Time Act.

However, as I cannot be satisfied that the Complainant was due to amount of leave claimed as accrued at the time of termination of his employment, I find that this element of the complaint is not well founded.

In conclusion and having regard to all the circumstances of the complaint, it is my decision that this complaint is well founded and that the Respondent must pay the Complainant the amount of €64,080.

Payment of wages