The Avoidable Fears and Panic of Small Employers-3 Illustrative Cases

Are you an employer? Have you been stressed and anxious about an employment issue recently?

I have met a number of employers in the last year or so and I had a great deal of sympathy for them.

Let me explain.

It’s very easy for you as an employer to make mistakes in relation to your employment law obligations. One of the obvious reasons for this is the massive body of employment law legislation on the statute books.

If you throw in EU directives and regulations and statutory instruments and recommended workplace policies/procedures and common law and decided cases and the constitution you would be forgiven for not knowing whether you were coming or going when an employee makes allegations or claims against you.

I have recently encountered a number of cases where employers eventually contacted me for advice and had they contacted a solicitor earlier in the day they could have saved themselves a lot of money, anxiety, and stress.

Referring a complaint to the Workplace Relations Commission

The first case involved a small family owned business who were, like most small business owners, flat out doing what they did: making stuff and selling it. Out of the blue they received communication from a trade union on behalf of a long standing employee. The letter set out a number of grievances going back many years and demanded a meeting with the trade union official and their member employee.

The employer, acting in good faith and trying to ‘do the right thing’, agreed and a number of meetings were arranged. These meetings were only moderately successful and involved the employee complaining about many issues, mostly trivial matters frankly, going back many years.

A number of meetings took place involving management of the company and the trade union official and employee. These meetings were time consuming and necessitated the preparation and issuing of minutes and the focusing of valuable management time.

Ultimately the meetings failed to resolve the issues and the employee, with the assistance of the trade union, submitted a claim to the Workplace Relations Commission. Once the employer received the formal letter from the WRC advising of the complaint he immediately panicked and embarked on another round of meetings to try to resolve the issues.

Schedules had to be arranged to facilitate all concerned and ultimately proved to be a waste of time as the employee was still not satisfied.

This whole episode caused great anxiety and stress to the owners of this small business who were anxious from the outset to deal with the problem fairly and in accordance with the law.

What the employer could have done

Firstly, the employer should have obtained professional advice.

If he did he would almost certainly have been told that the issues raised by the employee were grievances or complaints but not breaches of the employee’s rights. Therefore nothing unlawful had been done and there was no cause for panic.

Secondly, the employer could have given the employee a copy of the staff handbook and directed his attention to the grievance procedure in the handbook and told him he was obliged to use the internal grievance procedure to try to ventilate his complaints and have them dealt with.

He would also have been told that the outcome of the grievance procedure could be appealed if the employee was still not happy but ultimately the decision of that appeal was final.

Thirdly, if the employer sought professional advice early he should have been told that the complaint that was submitted to the WRC was a ‘trade dispute’ under the Industrial Relations Act, 1969 and the employer could simply refuse to have it investigated by the WRC by ticking a box on the letter he had received from the WRC.

A lot of stress and anxiety, and expenditure of management resources, would have been avoided, not to mention money saved.

Alleged breach of contract

The second case involved an employee going to a solicitor and making a wide number of allegations about non payment of wages for extra hours allegedly worked, holiday entitlements, public holidays, failure to pay minimum wage, a stress related injury as a consequence of the workplace, and so on.

The threatened legal action contained in the solicitor’s letter on behalf of the employee covered all of the above issues going back many years and demanded a significant payment to ‘settle the matter and all claims arising from the employment’.

It was a real ‘mixum gatherum’ of a demand letter and caused the recipient small business owner a great deal of anxiety and stress. She was an elderly lady who had employed this employee for over thirty years and in addition to the stress and worry at receiving such a letter was also personally disappointed on a human level for she felt she had been very fair with this employee for three decades and was taken aback to see the relationship go downhill.

The small business owner, an elderly lady who has retired from the business which was now run by her son, was incredibly upset by the whole affair.

The employee who was making this claim was at an age when many people would consider retiring and it appeared that this claim may have been one motivated by a desire to get recognition for the years of service, one way or the other.

On the face of it the demand by the employee for an eye watering amount of money was intensely worrying. However, when the issues and claims were stripped down to their essence the situation was not nearly as bad as first appeared.

Firstly, I explained that even though the employee was claiming a stress/psychological injury as a result of the situation in the workplace it is very difficult to successfully succeed with such a claim. I told her son that the employee would need to prove a number of things:

  1. That he had suffered an identifiable psychiatric/psychological injury
  2. That the injury suffered was as a result of the negligence of the employer
  3. That the injury was forseeable and the employer had failed to act as a reasonable employer would.

In other words if the employee had only suffered ‘ordinary stress’ and not a recognised psychiatric injury he would be unlikely to succeed with a personal injury claim. Courts recognised that work is generally a cause of stress. It is not play or entertainment or recreation.

Moreover, bringing a personal injury claim would require expensive medical reports and take quite a while to get to court for hearing and incur significant legal costs with an uncertain outcome thus leaving the employee with a touch decision to make.

In short when the rubber hit the road this ‘stress’ claim may not even get off the ground.

With regard to the other claims concerning holiday pay, public holiday entitlements, or non payment of wages, for example, these would need to be submitted to the WRC (Workplace Relations Commission) within 6 months of the alleged breach of the relevant act.

Thus, the WRC would not be able to deal with the entire value of his claim, assuming there was merit in it, as he would be ‘out of time’ for the bulk of what he was claiming.

This six months rule would not apply if he sued for breach of contract in the Civil courts and he could go back 6 years. However, this would involve legal proceedings for breach of contract in the civil Courts and with the amounts of money involved it may not actually be worth the risk in the end.

Yes, if he won he would almost certainly get his legal costs awarded by the Court, however if the claim was a relatively small one would it be worth it? Would he have the evidence to support all aspects of his claim? Would the employer have a good defence and/or better records? And he would be statute barred in respect of the parts of his claim which were over 6 years old.

Therefore when this particular claim, which commenced with a demand for an eye watering sum of money from the employer, was stripped down to its bare essentials it was not nearly as worrying or stressful for the employer.

Nor an attractive money pot for the employee.

Unfair dismissal

Another employer contacted me in a lather of sweat about an unfair dismissal claim that is coming up. She checked online and discovered that the potential award in an unfair dismissal claim is up to 2 years’ salary.

However, the legislation allows the award of financial loss to a maximum of 2 years’ salary and this level of award is extremely rare.

In her particular case, however, the employee had got a new job within 1 month of the dismissal. Therefore the maximum financial exposure for this claim was 1 month’s salary.

If she calculated how much this would amount to, and the fact that she could put up some sort of defence to the claim when the hearing was held, she would have seen that it was not something that should cause a great deal of anxiety.

And she could always try to settle it in advance of the hearing and avoid the time and cost involved in attending a WRC hearing, especially if she wanted to have legal representation. I would have had to advise her, however, that the cost of defending the case using a solicitor might actually exceed the potential award to the employee.

So, if she wanted to defend it she could consider doing it herself and taking her chances.

Normally I would not recommend this approach but if an employer has a potential exposure for a small award that is not likely to exceed the cost of legal representation then I would advise her to this effect and let her decide.

Conclusion

You will see from these three examples that massive fear and worry can be caused to decent employers if they do not obtain sound professional advice from the outset.

Yes, employers must afford employment rights to their employees and treat them decently, with respect, and lawfully. And if they don’t they will be brought to account. Quite right, too.

But unnecessary fear or stress to employers caused by bad or no advice can be avoided if they seek professional advice early in the day from someone who is familiar with the ins and outs of employment law in Ireland.

Otherwise they will experience worry and anxiety that may be wildly out of proportion to their potential exposure in the claim(s) they are threatened with.






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Unfair Dismissal and Discriminatory Dismissal Are Parallel Claims-You Must Choose One or the Other

discriminatory dismissal

Did you know that you cannot bring a claim for unfair dismissal and discriminatory dismissal at the same time?

They are considered to be parallel complaints and you will have to choose one or the other.

Let me clarify: section 77 of the Employment Equality Act, 1988 states

77.— F117 [ (1) A person who claims —

( a ) to have been discriminated against or subjected to victimisation,

( b ) to have been dismissed in circumstances amounting to discrimination or victimisation,

( c ) not to be receiving remuneration in accordance with an equal remuneration term, or

( d ) not to be receiving a benefit under an equality clause,

in contravention of this Act may, subject to subsections (3) to (9) , seek redress by referring the case to the F118 [ Director General of the Workplace Relations Commission ] . ]

Thus, you are claiming that you have been dismissed in circumstances amounting to discrimination or victimisation.

You can also bring a claim under the Unfair Dismissals act, 1977 but you will have to choose which of these claims you will ultimately pursue.

Why? Because Section 101(4)(a) of the Employment Equality act, 1998 states:

(4A) (a) Where an employee refers —

(i) a case or claim under section 77 , and

(ii) a claim for redress under the Act of 1977,

to the Director General of the Workplace Relations Commission in respect of a dismissal, then, from the relevant date, the case or claim referred to in subparagraph (i) shall, in so far only as it relates to such dismissal, be deemed to have been withdrawn unless, before the relevant date, the employee withdraws the claim under the Act of 1977.

(b) In this subsection —

‘ Act of 1977 ’ means the Unfair Dismissals Act 1977 ;

‘ dismissal ’ has the same meaning as it has in the Act of 1977;

‘ relevant date ’ means such date as may be prescribed by, or determined in accordance with, regulations made by the Minister for Jobs, Enterprise and Innovation. ]

This means that the discrimination based claim under the Employment Equality act, 1988 will be deemed to be withdrawn unless, 41 days after notification from the WRC, you withdraw the claim under the Unfair Dismissals act, 1977.

Then, if you withdraw the claim under the Unfair Dismissals Act, 1977 your discrimination based claim under the Equality Act 1988 will go ahead.

If you don’t respond to the letter you receive from the WRC your claim under the Equality Act, 1988 will be deemed to be withdrawn and your unfair dismissal claim will be dealt with.

Section 101A of the Employment Equality Act, 1998 also prohibits parallel claims as follows:

101A. — Where the conduct of an employer constitutes both a contravention of Part III or IV and a contravention of either the Protection of Employees (Part-Time Work) Act 2001 or the Protection of Employees (Fixed-Term Work) Act 2003 , relief may not be granted to the employee concerned in respect of the conduct under both this Act and either of the said Acts.

Takeaway

If you bring claims to the Workplace Relations Commission sometimes your case will be straightforward, but sometimes you can easily fall into a technical or legal roadblock that may give you a nasty surprise.

You should always seek legal advice before you bring any claim as it is vital that you choose the correct cause of action. This cannot be remedied later on and I have seen some very silly, basic mistakes made by workers who ultimately make some simple but fatal mistakes and end up with nothing but heartache and disappointment.

Manager Exploits Staff for Sex and Wins Case for Unfair Dismissal

sexual harassment

Did you ever read Oliver Twist by Charles Dickens?

Dickens introduced a great number of unforgettable characters to the world in this novel about the exploitation of orphan children by ‘the Jew’, Fagin to engage in criminality and picking pockets on the streets of London in the 1830s.

In Oliver Twist you had Oliver Twist himself (“please sir, can I have some more?”), John (aka Jack) Dawkins (‘the Artful Dodger’), Nancy, the good hearted lover/prostitute of the evil Bill Sikes, and a lad called Charlie Bates.

Charlie Bates spent a lot of his time on the floor laughing uproariously at the antics of the gang and exclaiming “What a game!” in reference to the criminality and picking of pockets in which the orphaned children were forced to engage.

I thought of Charlie Bates and his stock phrase “what a game!” when I read of a recent decision of the WRC in a case involving a male manager of a store in a restaurant chain who admitted to sexually harassing female staff under his management.

To cut to the chase he offered accomodation to female staff in return for sex.

The employer, on discovering this and after engaging the services of a HR person to carry out an investigation, summarily dismissed him for gross misconduct on the grounds of repeated sexual harassment in the workplace.

The dismissed manager brought a claim to the Workplace Relations Commission (WRC) for unfair dismissal.

And guess what?

He won on the grounds of the absence of fair procedures (“procedures hopelessly flawed”), the WRC Adjudicator having found that his conduct amounted to sexual harassment and the dismissal was substantially fair.

He was awarded €6,500.

As Charlie Bates might have said, “What a game!”

Lack of fair procedures

The grounds for finding that the procedures were “hopelessly flawed” included

  • The company ignored the employee’s direct evidence and relied on hearsay evidence
  • The employer failed to provide witness statements to the manager
  • The employer failed to advise him of the seriousness of the situation and the potential for dismissal
  • The employer failed to allow the manager defend himself or have representation
  • The employer failed to allow him to cross examine his accusers or challenge witness statements
  • The employer did not give him the specifics of the sexual harassment allegations against him.

However, it is reported that the company engaged the services of an external HR advisor to carry out an investigation and the manager “confirmed to the investigator that he offered accommodation to employees in order to have sex with them”.

Moreover, the manager had been involved in a relationship with one of the employees (who broke it off when she discovered he was married) and the report found he “was accused of unwelcome advances and offers of going to the cinema, restaurants or visits to the park. There were accusations of non-verbal conduct of a sexual nature including leering and making sexually suggestive gestures”.

Lessons to be learned

It’s difficult to understand, having read the facts and report of this case, what circumstances will give rise to a safe summary dismissal from an employer’s perspective. Therefore the safest bet appears to be to always afford fair procedures and natural justice no matter what the circumstances.

At the very least ensure the allegations are put to the employee in sufficient details and he has a chance to explain his version of events and side of the story.

This way might ensure you are not indulging in a Charlie Bates’ reaction of rolling around on the floor saying “What a game!” after reading about, or being involved in, an unfair dismissal.

You can read the full case here.

Reinstatement of Dismissed Employee-A Warning for Employers

unfair dismissal-1

Are you an employer?

If you have dismissed an employee you are almost certainly aware that a successful claim against you by your former employee can lead to an award of compensation of up to 2 years’ salary.

But did you know that there are 2 other remedies that can be awarded if the employee’s claim succeeds?

Yes, the Workplace Relations Commission adjudicator, in an unfair dismissal hearing, can also order that the employee be reinstated or reengaged. This can be the worst possible outcome for some employers.

It is not a frequent outcome to an unfair dismissal claim and more often than not the employee will only tick the box on the WRC claim form seeking compensation. If this is the case then the adjudicator has no decision to make once he decides the employee has been unfairly dismissed.

But sometimes an employee will seek reinstatement to their old position. He may do this for tactical reasons-for example, it may encourage the employer to attempt to settle the claim before it goes to a hearing at WRC for fear of losing.

On other occasions, however, by virtue of the nature of the industry or specialised nature of the job, the employment prospects for the dismissed employee may be poor. If this is the case the employee may be perfectly happy to resume his old job, or an alternative position in the same organisation, which can be an equally bad result for the employer, who would be happy to never see the employee again.

This can cause a major headache for the employer who will doubtless argue that the relationship between employer and employee has broken down and there is a lack of trust and confidence between the parties and they should not be forced into resuming the old relationship.

This is a widely used and accepted argument. But it’s not always successful.

A Banker v A Bank Adj ADJ-00001266

The WRC adjudicator, on 28th March, 2018, made an order for re-instatement in this case involving a banker versus his former employer, a bank. The banker, a trader, was dismissed for gross misconduct and brought a claim for unfair dismissal.

Without going into all the details (there is a link below for full details of the decision) the decision of the adjudicator, Mr. Kevin Baneham, was that the unfair dismissal claim was to succeed due to the imperfections and flaws in the bank’s disciplinary procedure which led to the dismissal. The next step to be decided was the appropriate redress for the employee.

The redress sought by the banker, once he succeeded in his claim, was re-instatement. The adjudicator agreed that re-instatement and re-engagement were possible awards as the banker was a popular employee whose performance appraisals were good and was a good team player.

Mutual trust and confidence/disharmony

The bank, however, argued that re-instatement was not appropriate as it could lead to a poor relationship between the parties in the future, there would inevitably be disharmony, and the relationship of mutual trust and confidence between the parties was shattered. The adjudicator did not agree.

The adjudicator had regard for the fact that the banker operated in a strictly regulated environment and industry and a dismissal would possibly be fatal to obtaining alternative employment in such an industry, given the relatively limited options. For this reason the adjudicator ordered that the employee be re-instated as it was ‘just and equitable in this case’.

For the reasons provided in this report, I find that the complaint of unfair dismissal is well founded and, pursuant to section 7(1)(a) of the Unfair Dismissals Acts, I order the re-instatement by the respondent of the complainant in the position which he held immediately before his dismissal on the terms and conditions on which he was employed immediately before his dismissal together with a term that the re-instatement shall be deemed to have commenced on the day of the dismissal.

You can read the full decision in this case here: ADJ-00001266

Lessons for employers and employees

If you are an employer ensure you or your advisor checks the WRC complaint form to see if the redress sought by the employee includes re-instatement or re-engagement.

If you are an employee you may consider nominating those options as redress you are seeking as it may put some pressure on your former employer to settle the case before it goes to hearing, for fear you will win and an order for re-instatement is made.

2 Years’ Salary Awarded to Van Driver in Unfair Dismissal Case

the labour court

The maximum amount that can be awarded in an unfair dismissal case is 2 years’ remuneration (section 7, Unfair Dismissals Act, 1977).

I had never seen it awarded until this case, DHL Limited and Michael Coughlan, in which Mr. Coughlan was awarded €72,042.88 by way of compensation.

On the 28th July, 2017 the Labour Court handed down its decision in an appeal by the employer of the previous WRC adjudicator decision in the employee’s favour.

Background

The background to this case is an WRC adjudicator decision of 30th January, 2017 to decide that the employee should be reinstated in his job as a DHL driver.

Mr. Coughlan was employed as a van driver for 11 years until his summary dismissal in November, 2015.

Mr. Coughlan brought a claim for unfair dismissal to the WRC and the Adjudicator decided that the sanction imposed on Mr. Coughlan for an accident involving his vehicle was, “disproportionate having regard to all the circumstances.” She ordered reinstatement from September, 2016, when the WRC hearing was held.

Mr. Coughlan had previously accumulated written warnings, with a duration of 12 months each, for a couple of incidents involving his driving, but had no such incidents for 2 years prior to the incident in 19th October, 2015 which led to his dismissal. Mr. Coughlan, at the investigation meeting, admitted that he had misjudged the space available to him while passing another vehicle at the Cork Depot of the employer, and apologised. The damage to the van cost €2,500 to repair.

Following the disciplinary hearing the employer decided to dismiss Mr. Coughlan for gross misconduct involving the incident and damaging of company property. However, the employer’s letter advising him of his summary dismissal made reference to his previous driving problems, even though the last warning he had was expired for some time.

The employer, in its response to Mr. Coughlan’s appeal, relied on his previous record of driving incidents and written warnings, and gave evidence that DHL could not rely on the employee to drive the company vehicles safely and no other option, for example, redeployment, was open to the employer on this occasion.

The head of operations of the employer gave evidence that he felt it appropriate to take the previous driving record of Mr. Coughlan into account when hearing his appeal to the dismissal, notwithstanding that the previous warnings had expired.

Labour Court Findings

The Labour Court found that Mr. Coughlan was confronted with multiple accounts of misconduct at the disciplinary hearing, even though there was no reference to multiple allegations in the letter inviting him to the hearing. The letter only referred to his failure to protect and safeguard company property (the van).

The Labour Court also found that the employer’s decision to dismiss was motivated, partly, by what it saw as its duty of care to the public, and safety grounds; however, this was completely different from the subject matter contained in the letter inviting Mr. Coughlan to the disciplinary hearing as the letter stated he was being invited to meet the allegation of failure to protect and safeguard company property’.

The Labour Court also found that the grounds for summary dismissal without notice are very restricted, as can be seen from established jurisprudence in relation to dismissal, and a reading of Section 8 of the Minimum Notice and Terms of Employment Act 1973, which requires very bad behaviour of such a kind that no reasonable employer could be expected to tolerate the continuance of the relationship for a minute longer.

As the allegation against Mr. Coughlan was that he failed to protect and safeguard company property it was held that this could not constitute gross misconduct justifying summary dismissal, that is, without notice.

The Labour Court also found that the employer did not give due consideration to alternative sanctions short of dismissal, nor did it allow him to offer to pay for the damage to the vehicle.

Furthermore it found that the employer gave too much weight to the previous incidents concerning Mr. Coughlan’s driving, and noted that his previous written warnings had expired by the time of this incident.

The Labour Court, for the reasons set out above, decided Mr. Coughlan was unfairly dismissed.

It took into account Mr. Coughlan’s attempts to mitigate his loss by seeking new employment: He told the Court that in the period since October 2015 he has applied for some 23 or 24 jobs without success. He applied for various roles including that of courier, driver, general operative, cleaner and store person. The Respondent was called to a small number of interviews by named employers but no job offer ensued from any of them.

The Labour Court awarded him €72,042.88 by way of compensation, being the equivalent of 104 weeks’ remuneration, which it viewed was the employee’s financial loss to date attributable to the dismissal.

You can read the full case here.