Damhnait Nic Bhrádaig v Employment Appeals Tribunal and Others
| Jurisdiction | Ireland |
| Judge | Ms. Justice Baker |
| Judgment Date | 20 May 2015 |
| Neutral Citation | [2015] IEHC 305 |
| Court | High Court |
| Date | 20 May 2015 |
[2015] IEHC 305
THE HIGH COURT
BETWEEN
AND
AND
Employment – Payment of Wages Act 1991 – Reduction of wage – Applicability of the Financial Emergency Measures in the Public Interest – Public servant.
Facts: The appellant sought a statutory appeal against impugned order of the Employment Appeals Tribunal affirming the decision of the Rights Commissioner reducing the salary of the appellant. The appellant contended that the reduction was unlawful as it breached the Payment of Wages Act 1991. The appellant contended that the reduction could be made with respect to the salary of a ‘public servant’ governed by the Financial Emergency Measures in the Public Interest Act only. The appellant further argued that the reduction was not made for the purpose of the legislation.
Ms. Justice Baker held that the statutory appeal against impugned order of the Employment Appeals Tribunal would be rejected. The Court affirmed the decision of the Employment Appeals Tribunal. The Court declined to accept the submission of the appellant that the reduction was not made for the purpose of the legislation. The Court held that the appellant would be a ‘public servant’ governed by the provisions of the Financial Emergency Measures in the Public Interest Act. The Court observed that the appellant duly fell within the two requirements of the Act.
1. This is a statutory appeal on a point of law brought under s. 7(4)(b) of the Payment of Wages Act 1991 (the "Act of 1991") in respect of a decision made by the Employment Appeals Tribunal (the "EAT"), the respondent, with regard to the applicability of the Financial Emergency Measures in the Public Interest (No. 2) Act 2009 (hereinafter "FEMPI (No. 2)") to the appellant.
2. The appellant is an employee of Mount Anville School, the first notice party, a fee paying private school where she is employed as a secretary. Her salary is wholly paid by the school and she asserts that the reduction in her salary imposed by her employer under FEMPI (No. 2), is unlawful and in breach of the Act of 1991, as she did not consent to the reduction as is mandated by s. 5(1)(c) of that Act. The appellant contends as she is not a public servant within the meaning of the legislation and that reductions under FEMPI (No. 2) may lawfully be made against the salary of a public servant only.
3. The appellant was unsuccessful in her application to the Rights Commissioner who gave a determination on the 20 th March, 2012 that she was a public servant for the purposes of ihe legislation, a decision affirmed by a majority decision of the EAT on 29 th July, 2014.
4. The High Court is empowered to hear an appeal on a point of law under s. 7(4)(b) of the Act of 1991 in respect of an EAT decision. The determination of the High Court on the point of law is final and conclusive.
5. The facts may briefly be stated. The plaintiff has been employed as school secretary in Mount Anville Secondary School since the 8 th July, 1991. Her salary is funded entirely by private funds raised through the fee structure in operation in the school, a fee paying private school. The school itself is owned by the Society of the Sacred Heart and Mount Anville Educational Trust Company which operates as patron of that school. The school was founded in or around the year 1853, and it seems that the Trust was established some time thereafter, the precise date whereof is not relevant to the question I am asked.
6. The appellant has no pension rights arising from her employment and her pension is wholly privately funded.
7. The question before me is whether the appellant is a public servant governed by the provisions of the FEMPI (No. 2) Act.
8. FEMPI (No. 2) was one of a series of emergency statutes enacted in the context of the financial crisis which occurred in the State after the financial and banking crash in 2008. The FEMPI (No. 1) Act came into force on the 27 th February, 2009 and made provision for the compulsory payment of a pension contribution by certain persons employed in the public service. The Act recited the purpose and need for the legislation as arising from the fact that the value of public service pensions was significantly and markedly more favourable than those generally available in other employment. That Act has no direct application to the matters raised by the appellant in this case.
9. The FEMPI (No. 2) Act came into operation on the 20 th December, 2009 and had more far reaching effects and provided for the general reduction in the remuneration of certain persons in the public service. The recited purpose of that legislation was to facilitate the making by the State of "significant" savings in its direct and indirect expenditure on public service remuneration.
10. Section 2 provides for the reduction in the remuneration of public servants as defined in that Act, and in accordance with a sliding scale set out in s. 2(2), the relevant rate being that found in table 3 of the subsection.
11. The applicant claims that she is not a "public servant" within the meaning of this legislation and that accordingly the reductions made to her salary were not lawfully made.
12. As with many matters governing the relationship between the State and the school sector the Minister makes directions by means of Circulars. Circular 0070/2010, sent to all principals or chief executive officers of primary, secondary, community and comprehensive schools and VECs, contained the following directions with regard to the FEMPI (No. 2) Act:
"As you are aware the Act has determined the criteria for reducing the pay of public servants with effect from 1 January 2010. The definition of a public servant for the purposes of this Act is different to that used in the Act which introduced the Pension Levy in 2009. This led to a question as to whether some staff employed in recognised schools or VECs, who are not subject to the pension levy may be subject to the reductions in pay detailed in this Act.'"
Following receipt of legal advice it has now been determined that all staff employed by a recognised school or VEC come within the definition of "public servant" solely for the purposes of the Act.
This applies, regardless of the source of the money used to fund their salary, notwithstanding the fact that the Minister does not determine their terms and conditions of employment, and irrespective of whether or not they are eligible for, or members of a public service pension scheme,
It has now been determined that, in accordance with the Act, you should ensure that the pay reductions provided for therein are applied, with effect from 1 January 2011, to all relevant staff in your employment who have not already been affected by these pay reductions. In view of the uncertainty that existed the Minister of Finance has granted an exemption from the provisions of the Act for the staff in question up until 31 December 2010."
13. The Circular set out a list of the categories of staff who would be affected by the FEMPI (No. 2) reductions in pay, and these included school secretaries and other non-teaching staff. There was an express comment to the effect that the making of the reductions, and the fact that these members of school staff were deemed to be public servants for the purposes of FEMPI (No. 2), "does not alter their employment status in any other respect."
14. The first notice party applied the relevant reduction to the salary of Ms Nic Bhrádaig and correspondence with her from the school has been exhibited in these proceedings. From this it can be ascertained that the Board of this school has unsuccessfully with other, presumably private, schools lobbied the Minister for Education and Skills to grant an exemption from the Act for all privately paid members of staff. The school Board is sympathetic to Ms Ni Bhraiadgh
15. The applicant applied to the Rights Commissioner who gave a decision on the 20 th March, 2012 that the reduction in pay was a lawful deduction within the meaning of s. 5(1) of the Payment of Wages Act 1991. The applicant appealed to the EAT, which by majority decision, affirmed the decision of the Rights Commissioner on the 29 th July, 2014. While the majority does not give a reason there is a two page detailed dissenting opinion.
16. It is against that determination that this appeal is brought.
17. The question in this case involves a net legal question, namely what is meant by the category of persons defined as "public servants" within the meaning of the legislation. It is accepted by Ms Nic Bhrádaig that if she is a public servant that the reductions provided in FEMPI (No. 2) apply to her, but she contends that she is not a public servant within the meaning of that definition.
18. Section 1 of the Act defines a public servant as "a person who is...
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