WRC awards €30,000 after pregnant Finance Director refuses 60% pay cut
What happened
In a decision reported on 30th January 2026, the Workplace Relations Commission awarded €30,000 to a finance director who was dismissed after refusing to accept a proposed 60% reduction in salary.
The employer maintained that the pay reduction was necessary due to business pressures. The employee, who was pregnant at the time, declined to accept the revised terms. Her employment was subsequently terminated.
The WRC examined both the contractual variation and the surrounding circumstances, including the impact the proposed reduction would have had on maternity leave entitlements.
What the WRC focused on
The Adjudication Officer concentrated on several core issues:
● Whether the salary reduction constituted a fundamental change to a core contractual term
● Whether genuine and meaningful consultation had taken place
● Whether dismissal following refusal was reasonable and proportionate
● Whether the proximity to maternity leave raised a discriminatory inference
The WRC found that a 60% reduction in salary was not a minor operational adjustment but a fundamental alteration of contract. The employee was entitled to refuse such a change.
Critically, the WRC was not satisfied that the employer had demonstrated a fair and structured process before moving to dismissal. There was insufficient evidence of meaningful consultation, exploration of alternatives, or consideration of other options such as redundancy.
The Maternity Element
While the employer argued that the proposal was financially driven, the WRC considered the practical impact on the employee’s maternity entitlements.
Under the Employment Equality Acts, once pregnancy is established as a factor in the background, the burden shifts to the employer to demonstrate that the treatment was wholly unrelated to pregnancy.
The adjudicator was not satisfied that this burden had been discharged.
Even if the original motivation was commercial, the timing and financial implications created sufficient nexus to raise discrimination concerns.
Why the dismissal failed
The dismissal failed on two primary fronts:
First, refusal to accept a fundamental contractual downgrade does not of itself amount to misconduct or just cause for dismissal.
Second, the employer had not demonstrated that dismissal was within the band of reasonable responses open to a reasonable employer in those circumstances.
The WRC therefore found the dismissal unfair and awarded compensation.
Key lessons for employers
● Significant pay reductions require genuine consultation and agreement.
● Employees are entitled to refuse fundamental contractual changes.
● Pregnancy significantly heightens legal scrutiny.
● Dismissal must be proportionate and procedurally robust.
● Business rationale alone will not cure process deficiencies.
Restructuring is lawful. However, when core terms and protected characteristics intersect, the evidential burden on the employer increases substantially.
If your company is considering restructuring, pay variation or cost reduction measures, we can support you in ensuring the process is compliant, defensible and commercially aligned.
Contact MSS The HR People at info@mssthehrpeople.ie, Ph 018870690 or visit our website.
