The Labour Court recently issued one of its first decisions under the Protection of Employees (Temporary Agency Work Act) 2012 (the Act) in respect of a complaint on behalf of a midwife who claimed she was entitled to have a specialist qualification allowance treated as part of her basic pay*. Her claim has been upheld by the Labour Court. The case is interesting in its analysis of what constitutes "pay" under the Act.

The Act provides that agency workers should be accorded equal treatment as if they had been employed by the hirer firm from the first day at work. In this case, the Labour Court had to decide if a midwifery allowance, which the claimant says she was entitled to, comes within the definition of "pay" under the Act. The respondent agency argued that the definition of "pay" as set out in the Act is exhaustive. Pay under the Act means (a) basic pay and (b) any pay in excess of basic pay in respect of: 

  • Shift Work 
  • Piece Work 
  • Overtime 
  • Unsocial hours worked 
  • Hours worked on a Sunday

The payment of the allowance did not fall within the definition of any pay in excess of basic pay. The question then was whether the allowance forms part of "basic pay".

The Labour Court noted that basic pay is not defined under the Act. The Court went on to state that in determining whether a payment forms part of basic pay it would normally have regard to the manner in which the parties themselves regarded it. In this regard, evidence was furnished as to how the payment was treated / viewed, with the Court noting that an allowance in the nature of pay is normally understood to be one on which pension contributions are payable. The Court also noted that the specialist allowance is paid in respect of a qualification without which she cannot practice as a midwife. On foot of this, the Court upheld the claimant's claim and found that the allowance was "an integral part of basic pay to which the claimant had an entitlement under the Act". 

The case is interesting as it is one of the first determinations under the Act, particularly as it applies to the interpretation of "basic pay". As this phrase is not defined in the legislation, it undoubtedly may cause difficulty in interpretation in years to come and this decision represents some guidance on what may be deemed to be a constituent part of basic pay.