An employee working in Aer Lingus brought a claim to the WRC to be placed on a banded hours contract of employment under section 18A of the Organisation of Working Time Act 1997.
This new section 18A was inserted into the Organisation of Working Time Act 1997 by section 16 of the Employment (Miscellaneous Provisions) Act 2018 which deals with banded hours contracts. It states, inter alia, that
18A.(1) Where an employee’s contract of employment or statement of terms of employment does not reflect the number of hours worked per week by an employee over a reference period, the employee shall be entitled to be placed in a band of weekly working hours specified in the Table to this section.
In the case involving the Aer Lingus employee, Ms O’Leary, the employer placed her on Band F (average working week of 26-31 hours). In arriving at this band, the employer took into account her 4 weeks of annual leave when calculating her average hours worked in a week.
This had the effect of lowering her average from the hours she actually worked. She appealed the decision to the Labour Court contending that she should have been placed on Band G (average working week 31-36 hours of work).
Labour Court decision
The Labour Court had to decide whether annual leave should be included in the calculation to arrive at the correct band for the purposes of the contract. If annual leave is included, it noted, then it is a mathematical certainty that the figure arrived at would be less than the actual average of hours worked.
The Labour Court held that this could not have been the intention of the Oireachtas when framing the legislation. It also noted that there is no definition of ‘hours worked’ in section 18A of the Organisation of Working Time Act 1997.
Nevertheless, it held that the intention of the Oireachtas would have been to ensure that the employee’s average hours worked be recognised.
It concluded, therefore, that annual leave should be excluded from the calculation used to arrive at the correct band for the banded hours contract.
The Labour Court upheld the employee’s appeal and moved her to the correct band, Band G.
Conclusion
If an employee has 4 weeks holidays then the reference period for the purpose of the banded hours contract is 48 weeks. The employer therefore must divide the total number of hours worked by 48 (not 52) to arrive at the correct weekly average and the correct banded hours contract.
Read the Labour Court decision here in Aer Lingus and Cliona O’Leary DWT207.