Complainant

Respondent

Parties

Mrs Mary McLoughlin

RTE

Complainant

Respondent

Anonymised Parties

Representatives

Mr Vivian Cullen SIPTU-Trade Union

Mr Barry Walsh Fieldfisher LLP

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-00066366-001

30/09/2024

This matter came before the Workplace Relations Commission dated 30/09/2024.  The Complainant alleges contravention by the Respondent of provisions of the above listed statute in relation to her employment with the Respondent.  The aforesaid complaint was referred to me for investigation.  A hearing for that purpose was scheduled to take place on 14/02/2025. 

The Complainant is a former employee of the Respondent.  The Complainant was employed by the Respondent as a Copy Taker at all material times.  The Complainant commenced her employment with the Respondent on 01/11/1996 and the employment ended when she retired in April 2023. 

The within claim relates to a post-retirement fixed-term contract.

The Respondent is the national public service broadcaster of Ireland.  It provides a range of services including television, radio, and online content. 

Both parties provided helpful written submissions in advance of hearing for which I am grateful. 

CA-00066366-001

Overview of written submission

The Complainant’s submits she was not paid the remuneration to which she was entitled.  The Complainant submits she signed a contract in good faith and that the Respondent is now claiming there was an administrative error in the contract.  The Complainant submits she was given a contract extension for a six-month period at a certain wage (4th April 2024 to 4th October 2024) which was not paid to her because of what the Respondent is claiming to be an administrative error.  The Complainant submits she signed the contract in good faith and in accord with the terms and conditions of the fixed term contract including the rate of payment.  The Complainant submits the Respondent is refusing to pay her wage or to come to any sort of compromise. 

The Complainant submits she believes the Respondent has reneged on the contract.  The Complainant submits the contract per se was that agreement which she relied on and her expectations.  The Complainant submits it is her understanding that she believes she is owed €6,425.00. 

The Complainant submits the kernel of her case is that she signed a contract (offer, consideration, and acceptance) which stated she would receive €12,850.00 for six months for 9 hours per week a contract that was also signed by the Respondent. 

The Complainant submits her understanding is that shortly into the 6 months fixed-term contract (May 2024) a deduction of remuneration or wages properly payable was made by the Respondent a direct reneging of the contract of employment.

The Complainant submits she has been unfairly treated by the Respondent and that her claim against the Respondent is well-founded and that a deduction of wages properly payable has breached her rights under the Payment of Wages Act. 

The Complainant is seeking a financial remedy. 

Law relied upon by Complainant

Section 5(1) Payment of Wages Act, 1991

Summary of direct evidence of Complainant on oath

The Complainant submits she started her employment with the Respondent in 1998.  She was a copy taker and she retired at 65 after which she received two fixed term contracts.  The second one was for 6 months from April to October.  The Complainant submits she was always a copy taker but that she had slotted into numerous positions like admin work etc. 

The Complainant submits she had always worked for a particular producer and they wanted her to do five days of Liveline but she didn’t want to do that so they came back to her with 3 days.  The Complainant submits the contract came out and she signed it for 6 months.  The Complainant submits nobody came to tell her there was a mistake. 

The Complainant submits she was very happy with the contract and she didn’t think a mistake like that could be made.  The Complainant submits its been very stressful and she submits she has always been so obliging and she has slotted into numerous positions.  The Complainant submits it’s sad that it couldn’t have been rectified and that they could have met her halfway.

Summary of cross-examination of Complainant

It is put to the Complainant that there was no material change in the work she would be doing under the 6-month FTC and she is asked if she had expected the same rate of pay to apply to which she replies she said she couldn’t do 5 days.  The Complainant is asked if she would have expected an increase in pay of 100% to which she replies no but she signed the contract in good faith.  The Respondent representative puts it to the Complainant that their case is that she must have known it was an error to which she replies – no not originally but that when she got her first pay she realised and she contacted HR.  The Complainant submits the Respondent never came to her and that they made no meaningful attempt to which the Respondent witness submits a solution was put forward at the meeting on 31 July and it was agreed to which the Complainant submits she does not agree with that. 

Complainant closing submission

The Complainant representative submits there was offer, acceptance and consideration.  It is submitted there was a breach of trust and an illegal deduction and the Complainant is entitled to some financial compensation or remedy.  The Complainant representative submits there has to be serious consequences for mistakes and mistakes have consequences.  The Complainant representative submits they could have held out the olive branch and the Complainant is looking for a financial remedy. 

CA-00066366-001

Overview of written submission

The Respondent submits the Complainant essentially alleges that the Respondent has failed to pay wages properly payable to her under her second post-retirement fixed term contract of employment at and in doing so has made unlawful deductions to her wages, breaching section 5 of the Payment of Wages Act 1991, as amended ("the Act").

The Respondent asserts that there was an administrative error in the second post-retirement contract of which the Complainant knew (or, at very least) ought to have known at the time of execution of that contract.

The Respondent submits that due to an administrative error, Clause 5 of the second post-retirement contract titled "Remuneration" states that the Complainant will be paid a salary of "€12,850 gross in total for contract duration" whereas it should have stated that the Complainant would be paid a salary of "€12,850 gross per annum".

The Respondent submits the Complainant knew or ought to have known of the administrative error in circumstances where this error would have the effect of increasing the Complainant's salary by approximately 103% for carrying out the same duties as she has carried out since in or around 2003.

The Respondent submits that if the Adjudication Officer (AO) forms the opinion that the Complainant's claim is well-founded in that a deduction within the meaning of the Act has been made, the Respondent invites the AO to exercise their discretion pursuant to section 6(1) of the Act to direct that no amount of compensation should be payable in the circumstances.

Factual Background

The Complainant was due to retire on 10 April 2023 at age 65 but submitted a request to work beyond normal retirement age for an additional year.   This was granted and the first post-retirement contract commenced on 11 April 2023 for a duration of 12 months, ending on 10 April 2024 at a .47 FTE equivalent/38.5 hours per fortnight. 

There were no changes to the contracted hours or to the other material terms and conditions between the Complainant's original contract and her first post-retirement contract.  The Complainant's salary was €27,047 gross per annum for the first post-retirement contract plus a 5% PRC allowance.  On 20 October 2023, during the Complainant's first post-retirement contract, a pay increase of 1.5% was applied to all staff of the Respondent resulting in the Complainant's salary increasing to €27,453.  Prior to expiry of the first post-retirement contract, the Complainant submitted a further request to continue working with the Respondent after the termination of that contract.  This request was facilitated by the Respondent on an exceptional basis for 6 months.

The second post-retirement contract commenced on 11 April 2024 for a duration of 6 months, ending on 10 October 2024, and with a reduction of hours at the Complainant's request to 3 days per week (9 hours) – a .22 FTE equivalent/18 hours per fortnight.  The Respondent became aware on 21 May 2024 of an administrative error contained within Clause 5 of the second post-retirement contract, the effect of which was that the Complainant's salary was incorrect.

Clause 5 of the second post-retirement contract stated the following: " You will be paid at an initial salary of €12,850 gross in total for contract duration" whereas it should have stated the following: "You will be paid at an initial salary of €12,850 gross per annum".

A meeting took place between the Respondent, the Complainant and the Complainant's union representative on 12 June 2024, the purpose of which was to discuss this error in the second post-retirement contract.  At this meeting, the Respondent confirmed to the Complainant that the error contained within Clause 5 was due to an administrative oversight and apologised to the Complainant for the error.  The Complainant's union responded that this was a problem of the Respondent's own making and indicated an intention to lodge a complaint under the Act.

Further meetings were held between the Complainant and the Respondent on 10 July 2024 and 31 July 2024 in an attempt to resolve the matter.  The Respondent explained to the Complainant that her hourly rate remained unchanged and was still approximately €27 per hour.  The Complainant's salary had been intended to be reduced from the amount in the first post-retirement contract to account for (i) the reduced duration of the contract from 1 year to 6 months and (ii) the reduction in contracted hours from 38.5 per fortnight to 18 per fortnight – from a .47 FTE equivalent to a .22 FTE equivalent.

The Complainant indicated during one of these meetings that she was willing to increase her work hours but was not willing to work additional days on Liveline.   The Respondent offered the Complainant additional hours which would bring the total contracted hours to 30 hours per fortnight to reflect the salary in the second post-retirement contract.   

The Complainant indicated that she was willing to agree to this arrangement.  Following this meeting, on 1 August 2024, the Respondent issued a revised contract to reflect this arrangement.  To the best of the Respondent's knowledge, this revised contract was never signed by the Complainant.

However, on 4 September 2024, the Complainant's union representative advised that the Complainant was unhappy with the revised contract offer.  This came as a surprise to the Respondent.  On 13 September 2024, the Respondent received correspondence from the Complainant's union representative outlining their intent to submit a complaint to the Workplace Relations Commission ("WRC") on behalf of the Complainant whilst also seeking to engage in further discussions to resolve the matter.   

On 16 September 2024, the Respondent replied to the Complainant's union representative outlining that there had been many attempts to resolve this matter to date and that there had been no further communication from the Complainant and/or her union representatives to suggest that there were any further outstanding queries.  The Respondent indicated its view that the approach now being taken by the Complainant was unreasonable in the circumstances.  

On 17 September 2024, the Complainant submitted a medical certificate to the Respondent certifying that she was unwell and not fit to work. The Complainant was paid full sick pay during her absence. She did not return to work before the expiry of the second post-retirement contract.

The Respondent's Position

It is not disputed for the purposes of this claim that the Complainant was paid less than the amount which is set out at Clause 5 titled "Remuneration" in the second post-retirement contract.  However, the Respondent asserts that:

·         This was due to the existence of an administrative error in the contract of which the Complainant knew or ought to have known at the time of execution of the contract.

·         This is the case in circumstances where the error contained within the second post-retirement contract would have the effect of increasing the Complainant's rate of pay by approximately 103% for carrying out the same role and duties as she had carried out since in or around 2003. 

·         The Complainant agreed / accepted to the arrangement proposed by the Respondent that she would work additional hours to reflect the salary stated in the second post-retirement contract.

·         The Complainant is incorrect and misleading in stating in her WRC claim form that the Respondent refused to come to any compromise.

Law relied upon by the Respondent

Section 6(1) Payment of Wages Act, 1991

Primark Ltd t/a Penneys v Romana Vancekova PWD2250

Aer Lingus Ltd v Caitriona Jones PWD2248

Barry Creighton v Dublin Airport Authority (DAA) Plc ADJ-00032832

Summary of direct evidence of Respondent witness Ms Annette Malone (hereafter AM) on affirmation

AM submits the initial offering was 5 days x 3 hours per day but that the Complainant didn’t want to work Monday and Friday so the contract was for 3 hours per day 9 hours per week Tuesday through Thursday.  The witness submits that when the salary was stated in the contact it said it was for the duration of the contract but it should have showed an annualised salary as there was no change in the hourly rate. 

AM respectfully submits that one simply could not have known this was an error.  The witness submits it is accepted there was a mistake and the Complainant’s first contact was with payroll. 

The witness submits there was a meeting with the Complainant and her trade union official and HR and the individual who had made the mistake all of whom apologised.  The witness submits the error was accepted without reservation and that it was a genuine human error and that they offered additional hours. 

AM submits that SIPTU asked if she would meet with the Complainant which she did and they met twice and they spoke about lots of things trying to resolve this and to move forward.  The witness submits that at the 31st July meeting she asked if the Complainant would like to do additional hours and she offered 15 hours per week 30 hours per fortnight. 

The witness submits she does not accept they did not meaningfully engage but that she simply could not give the Complainant a 100% of a pay rise. 

The witness submits she believed they had reached an agreement but the issue was raised again by SIPTU in September.  The witness submits it was a mistake / human error that was not picked up and submits there had been significant meaningful engagement but she simply could not give a 100% of a pay rise of public money and to expect such was neither reasonable or fair. 

The witness submits this was like for like and it was not a promotion.  The witness submits they acted in good faith and they expected reasonableness and fairness from the trade union.  The witness submits the Complainant says she was unfairly treated and she does understand the Complainant is aggrieved but it was an error and the Complainant accepted it was an error. 

Cross-examination of Respondent witness AM

It is put to the witness that her solution is to ask their member to take a loss of 6k to which she replies it was not a loss it was an error.  The witness is asked if she accepts that errors have consequences and that the core of the relationship is based on trust to which she agrees.  The witness is asked if she accepts there was a breach of trust here to which she replies no that there was no deliberate attempt to breach trust and that it was a human error and there was nothing malicious intended. 

The witness submits she does not accept that trust was deliberately breached here.  The witness is asked if she offered a financial remedy and asked did she pony up to which she replies the rate of pay was the same and there was no loss of earnings per se and no she did not pony up and never considered it as this is public money here that we are talking about.    

Closing submission of Respondent

It is submitted the Complainant must have known the contract was not right but the Respondent did engage meaningfully and extensively until such time as there was an agreement in principle and then the Complainant saw fit to issue this claim. 

The Respondent representative submits an AO does have discretion here under the Act and he submits he does not believe it would be appropriate to make any award.  The Respondent submits it did its best to resolve the complaint.

CA-00066366-001

This is a complaint pursuant to the Payment of Wages Act, 1991. 

In conducting my investigation, I have reviewed all relevant submissions and supporting documentation presented to me by the parties.  I have carefully considered the oral evidence adduced at hearing.    I deemed it necessary to make my own inquiries into the complaint during hearing to establish and understand the facts and to seek clarification on certain matters. 

There is no dispute or disagreement on the fact the contract issued to the Complainant by the Respondent in April 2024 contained a mistake the effect of which the Complainant’s salary was incorrectly stated.  The Respondent submits this was an administrative error.  The Complainant submits mistakes have consequences and is seeking a financial remedy.

If this matter were subject to a determination under the law of contract it would be a straightforward matter.  Various facts and circumstances may negate what would otherwise be a legally binding contract.  Where such circumstances are found to exist one of both parties may be excused from their obligations which would otherwise apply.  Sometimes it is determined by the courts that there is no contract because the mistake is such that no agreement has been entered into.  Where the mistake is such that there was never a contract in the first place the contract is deemed void.

I note a unilateral mistake such as the mistake in the within case is one such category of mistake which would negate a contract.  A unilateral mistake arises where one party makes a mistake which is known or should have been known to the other party. 

Notwithstanding, this complaint as presented falls to be determined under the Payment of Wages Act, 1991 and it is through the lens of that legislation this complaint has to be investigated.    

The Relevant Law

Section 1 of the Payment of Wages Act, 1991 provides the following definition of wages:

"wages", in relation to an employee, means any sums payable to the employee by the employer in connection with his employment, including—

(a) any fee, bonus or commission, or any holiday, sick or maternity pay, or any other emolument, referable to his employment, whether payable under his contract of employment or otherwise, and (b) any sum payable to the employee upon the termination by the employer of his contract of employment without his having given to the employee the appropriate prior notice of the termination, being a sum paid in lieu of the giving of such notice:

Section 5 of the 1991 Act sets out:

5. Regulation of certain deductions made and payments received by employers

(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 matter for me to decide is whether the Respondent has properly paid the Complainant in accordance with section 5 of the 1991 Act. 

In the case of Marek Balans v. Tesco Ireland Limited [2020] IEHC 55 the High Court made it clear that the WRC, when considering a complaint under the 1991 Act, must first establish the wages which were properly payable to the employee on the occasion before considering whether a deduction had been made.  If it is established that a deduction within the meaning of the Act had been made, the WRC would then consider whether that deduction was lawful.  The 1991 Act does not define the concept of “properly payable” and I must reach a conclusion on this by reference to objective criteria and with due deference to previous findings of the Labour Court or other authorities. 

The Relevant Facts

The Complainant was provided with and signed a contract in which there was an error in the amount of remuneration set out in the contract which in effect meant that she would have received a 100% increase in wages. 

The contract of employment is the primary source of an employee’s entitlements and the employer’s obligations in relation to remuneration and conditions of employment. These are matters that must be agreed at the commencement of the employment and are the most essential elements of the bargain entered into between the parties. Unless there is an agreement to change the agreed terms, they are seen to endure. 

In the within case the Respondent and the Complainant signed a six-month contract which included the following term at clause 5:

“Remuneration

You will be paid an initial salary of €12,850.00 gross in total for contract duration, payable monthly in arrears, by way of a bank transfer into your nominated bank account.”

It is noted the contract should have stated the following:

“You will be paid at an initial salary of €12,850.00 gross per annum.”

In the within case the Complainant is relying on the terms of the contract as signed by the parties whereas the Respondent is relying on the terms as intended by them.

As a matter of fact it is noted the Respondent paid the Complainant on the basis of applying that which was intended by them i.e., €12,850.00 per annum.  When I consider this from a completely technical perspective whilst applying the provisions of section 5 of the 1991 Act, it is apparent that the Respondent was not authorised to deduct the payment claimed by reference to that section as none of the terms of (a), (b) or (c) applied to the withholding of the payment as expressed in the contract.

Section 5(6) of the Act of 1991 provides:

“(6) Where—

(a) the total amount of any wages that are paid on any occasion by an employer to an employee is less than the total amount of wages that is properly payable by him to the employee on that occasion (after making any deductions therefrom that fall to be made and are in accordance with this Act), or

(b) none of the wages that are properly payable to an employee by an employer on any occasion (after making any such deductions as aforesaid) are paid to the employee,

then, except in so far as the deficiency or non-payment is attributable to an error of computation, the amount of the deficiency or non-payment shall be treated as a deduction made by the employer from the wages of the employee on the occasion.”

Having considered the totality of the evidence adduced by both parties I am satisfied the Respondent was not aware of the error in the contract until such time as the Complainant received her first pay under the April contract and she immediately contacted payroll who in turn contacted HR. 

Notwithstanding, the fact remains an error was made in the contract by the Respondent and I am satisfied there is no provision in the 1991 Act that would allow a Respondent to vary a contract unilaterally.  Accordingly, I find I am unable to set aside the terms of the contract based on that error. 

I note and am mindful of the High Court in Balans where it washeld as follows at para 43:

“…I accept counsel for the appellant’s submission that in the circumstances of this case any error made in the drafting of this contract is not to be equated with a deficiency or non-payment attributable to a computational error within the meaning of s.5(6).  It does not appear to me that section 5(6) of the Act was designed to permit the effective rectification of a contract which, on the submission of one of the parties, contains an error.”  [emphasis added] 

The Act, at Section 5(6), provides that where the total amount of any wages that are paid on any occasion by an employer to an employee is less than the total amount of wages that is properly payable to the employee on that occasion, then, except in so far as the deficiency or non-payment is attributable to an error of computation, the amount of the deficiency or non-payment shall be treated as a deduction made by the employer from the wages of the employee on the occasion.

I am satisfied the within case is not one in which an error of computation arises.  In the circumstances of the within case it may be argued this was a situation where the error in the contract was corrected retrospectively and without the agreement of the Complainant.  Therefore, I have to conclude this was a deduction within the meaning of the Act.    

In the circumstances outlined I find the Respondent cannot rely on Section 5(1) of the Act to say that the deductions made from the Complainant’s salary were lawful. 

Accordingly, I find that an unlawful deduction from the Complainant’s salary occurred. 

Having decided that a complaint is well-founded, I must consider what award, if any, is reasonable in the specific circumstances of each case.

In its submission the Respondent argues that no compensation is reasonable in the particular circumstances arising in this case, and that the wording of the Act clearly allows an AO to make a nil award based on the facts of the case before him/her. 

Conversely, the Complainant representative argues that there are serious consequences for mistakes and is seeking a financial remedy. 

Section 6 of the 1991 Act provides as follows:

6. (1) A decision of an adjudication officer under section 41 of the Workplace Relations Act 2015, in relation to a complaint of a contravention of section 4C or 5 as respects a deduction made by an employer from the wages or tips or gratuities of an employee or the receipt from an employee by an employer of a payment, that the complaint is, in whole or in part, well founded as respects the deduction or payment shall include a direction to the employer to pay to the employee compensation of such amount (if any) as he considers reasonable in the circumstances not exceeding—

(a)    the net amount of the wages, or tip or gratuity as the case may be (after the making of any lawful deduction therefrom) that—

(i) in case the complaint related to a deduction, would have been paid to the employee in respect of the week immediately preceding the date of the deduction if the deduction had not been made, or

(ii) in case the complaint related to a payment, were paid to the employee in respect of the week immediately preceding the date of payment,

or

(b) if the amount of the deduction or payment is greater than the amount referred to in paragraph

(a), twice the former amount.

While I find the complaint to be well-founded, I make no award as provided for by the phrase “if any” in relation to the amount of compensation payable as set out in section 6(1) of the 1991 Act.  I make no award having very carefully considered all of the evidence adduced and I decide that an award of no compensation is reasonable having regard to all of the circumstances giving rise to this complaint. 

CA-00066366-001

I decide this complaint is well-founded. 

I decide that an award of no compensation is reasonable having regard to all of the circumstances giving rise to this complaint.

Unilateral mistake; no error in computation; human error;