5.— (1) An employer shall not make a deduction from the wages of an employee (or receive any payment from an employee) unless—

(a) the deduction (or payment) is required or authorised to be made by virtue of any statute or any instrument made under statute,

(b) the deduction (or payment) is required or authorised to be made by virtue of a term of the employee’s contract of employment included in the contract before, and in force at the time of, the deduction or payment, or

(c) in the case of a deduction, the employee has given his prior consent in writing to it.

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

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

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

unless—

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

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

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

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

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

and

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

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

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

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

Complaint to adjudication officer undersection 41 of Workplace Relations Act 2015

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 5 as respects a deduction made by an employer from the wages 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 (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.

(2) (a) An adjudication officer shall not give a decision referred to in subsection (1) in relation to a deduction or payment referred to in that subsection at any time after the commencement of the hearing of proceedings in a court brought by the employee concerned in respect of the deduction or payment.

(b) An employee shall not be entitled to recover any amount in proceedings in a court in respect of such a deduction or payment as aforesaid at any time after an adjudication officer has given a decision referred to in subsection (1) in relation to the deduction or payment.

The Payment of Wages Act prohibits the making of deductions from an employee’s wages unless required or authorised by the Act or the employee has consented to the deduction.

It is for the Complainant to show in the first instance that wages were properly payable to her and not paid by the Respondent. 

The evidence presented to me was that while the Respondent expected a downturn in income, the ultimate outcome was not as bad as expected. Revenue for 2020 was down 12% on 2019.  The Respondent for a period implemented the Temporary Wage Subsidies Scheme (TWSS). However, it did not meet the eligibility criteria and repaid the amount it received to the Irish Exchequer.

As regards the variation clause in the Complainant’s contract, such clauses are intended to permit minor non-material changes, which do not relate to core terms, such as updates to reflect changes in law or statute or a change in a work practice.

While I accept that the Respondent experienced difficulties due to the Covid-19 Pandemic, I do not accept that the decision to impose the deductions in the Complainant’s salary was reasonable and proportionate considering the Respondent was a multi-national Company and the work the Complainant was doing was not greatly impacted by the Pandemic. 

Imposing pay cuts, even of a temporary nature, without consultation or consent, by reliance on such variation clauses is not reasonable.

I accept the Complainants evidence that 15% of her wages were deducted by the Respondent.   I do not accept that this was a reduction in pay. 

My power under the Payment of Wages Act is to make an order in relation to complaints preceding the date on which the complaint was made.  The complaint was made on the 15/5/2020.

The deductions made to the Complainants pay were spread over five pay periods and were in the following amounts:

Pay period 8 Paid on 17 April 2020 €174.70 (gross)

Pay period 9 Paid on 1 May 2020 €218.38 (gross)

Pay period 10 Paid on 15 May 2020 €218.38 (gross)

Pay period 11 Paid on 29 May 2020 €218.38 (gross)

Pay period 12 Paid on 12 June 2020 €109.19 (gross)

The Complainant was paid fortnightly in arrears.  My jurisdiction in this case covers pay periods 8,9 10 and 11.