Unfair Dismissal Claims Arising from Redundancy-Employer’s Conduct Must Be Reasonable

redundancy procedure
Redundancy procedure must be fair and reasonable

Any decision to make an employee redundant runs the risk of being challenged by the employee with a claim to the Workplace Relations Commission for unfair dismissal.

In a non collective redundancy the employer needs to be absolutely satisfied that

    1. The redundancy is a genuine one, not a sham or a ruse to terminate the employment of an employee who has been targeted
    2. The selection process has been fair with “the selection criteria being used should be objectively applied in a fair manner.”
    3. The procedure in carrying out the redundancy is fair.

Two useful decisions in this connection are ADJ-00001516, a decision issued on 6th December, 2016 in which the employee was awarded €21,750 for unfair dismissal arising from a redundancy and a Labour Court decision, UDD 1638 in which the employee was awarded €35,000 in consequence of the way the employer carried out the redundancy.

The adjudication officer in ADJ-00001516 referred to a previous decision of the Employment Appeals Tribunal in Case No. UD206 / 2011. In that case the EAT held

“When an employer is making an employee redundant, while retaining other employees, the selection criteria being used should be objectively applied in a fair manner.”

The EAT also held that any consultation must be real and substantial, not merely a going through the motions or box ticking exercise.

Right to Appeal

IN the ADJ-00001516 case the adjudication officer also noted that

“I also note that the complainant was not advised of any process by which he could appeal the decision on the termination of his employment.”

The adjudication officer also referred to the following extract from the 2011 EAT case in which the EAT held that

“There was no serious or worthwhile consultation with the claimant prior to making her redundant. The consultation should be real and substantial.

No suitable or substantial consideration was given to alternatives to dismissing the claimant by reason of redundancy.

There was no worthwhile discussion in relation to the criteria used for selecting the claimant. The selection criteria should apply to all employees working in the same area as the claimant but should also consider other positions which the claimant is capable of doing.”

It is reasonable to assume that WRC adjudication officers will judge these types of case applying the above criteria. Therefore if you are an employer you would need to pay attention to this decision.

Labour Court

In a separate case, the Labour Court had to deal with an appeal by an employer against the decision of the WRC in which the employee was awarded €35,000 for unfair dismissal in a ‘redundancy’ situation.

The Labour Court held that there was a genuine redundancy but the conduct of the employer in carrying out the redundancy was not reasonable and varied the award from €35,000 to €20,000. The full decision of the Labour Court in this case ( UDD 1638) can be read here.

The Labour Court held,

It is clear to the Court that the Appellant, in the manner in which it executed the dismissal of the Respondent, engaged in the minimum of consultation and in effect put a decision rather than a proposal to the Respondent at a meeting on 27th and 28th October. The Court notes that some engagement took place as regards alternatives which might exist on 28th October.

It is clear to the Court also that the Appellant made no avenue of appeal available to the Respondent in a situation where the Respondent was dissatisfied with the decision to terminate his employment with the Appellant.

In its decision it also stated

The Court, while finding that the Respondent’s position was redundant also finds that the manner of his dismissal as result was procedurally unfair. The Respondent was not consulted adequately, he was not afforded representation at the meeting on 27th October 2015 and he was denied the opportunity to engage with the Company Board when he requested that facility in a situation where he was not satisfied with the termination of his employment which had been communicated to him at a meeting on 27th and 28th October 2015.

Takeaway for employers

You will note from both of these cases that the WRC and the Labour Court accepted that the redundancies were genuine in each case.

Where things went against the employer and substantial awards to the employee arose, however, were as a consequence of the procedures adopted to give effect to the redundancy.

In short, the conduct of the employer was not held to be reasonable in both cases. Thus, it is not enough that a genuine redundancy situation exists-the procedure used to carry out the termination must be fair and reasonable at each step.

And from the cases referred to above we can assume that the following steps are strongly advisable:

  • Real and substantive consultation
  • Right of representation
  • Right to appeal the decision.

Exceptions to the 12 Months’ Service Requirement in Unfair Dismissal Claims

fair-dismissal-procedures

If you are unfairly dismissed and wish to bring a claim under the Unfair Dismissals Act 1977 you will need to have been employed continuously for 12 months.

If you do not have 12 months’ service you cannot bring a claim for unfair dismissal or constructive dismissal if you cannot clear this hurdle.

That is the bad news; the good news is there are some important exceptions to this 12 months’ service requirement. Let’s take a look at them, shall we?

Exceptions to 12 Months’ Service Requirement

  1. Protected disclosure-if you are dismissed for having made a protected disclosure under the Protected Disclosures act 2014 you do not need 12 months’ service
  2. Discrimination-if you were dismissed on a discriminatory ground you will be able to bring a claim under the Employment Equality Acts without 12 months’ service
  3. Trade union-an employee who is dismissed for trade union membership or activity does not require 12 months’ service
  4. Pregnancy, birth, breastfeeding-any dismissal connected with these issues can be brought without 12 months’ service
  5. Maternity protection-any dismissal arising from the exercise of a maternity right does not need 12 months’ service
  6. Adoptive leave-any dismissal arising from the exercise of an adoptive leave right does not need 12 months’ service
  7. Parental leave and force majeure leave-12 months’ service is not required for unfair dismissal claims arising from these rights
  8. National Minimum Wage Act, 2000-any dismissal arising from the employee seeking to exercise rights under this act can be brought without 12 months’ service
  9. Carer’s Leave act-12 months’ continuous service is not required.

It is inevitable that if you bring a claim the employer may well argue that you do not have the necessary 12 months’ service and will deny that you were dismissed arising from any of the exceptions set out above.

Clearly, each case will be dealt with on its own facts and circumstances but you will need to be prepared for this argument and ready to put forward facts from which it can be inferred that your dismissal did arise from the exercise of one of the categories listed above.

The Labour Court Recommends €90,000 Compensation In Unfair Dismissal Claim Against Park Hotel

park hotel unfair dismissal

I have written a number of blog posts about probation and the options open to an employee who has been dismissed whilst on probation.

The general position is that you cannot bring a claim for unfair dismissal under the unfair dismissal acts for section 2(1) Unfair Dismissals Act, 1977 sets out a number of categories of employees who are excluded from the protection of the act as follows:

2.—(1) This Act shall not apply in relation to any of the following persons:

(a) an employee (other than a person referred to in section 4 of this Act) who is dismissed, who, at the date of his dismissal, had less than one year’s continuous service with the employer who dismissed him and whose dismissal does not result wholly or mainly from the matters referred to in section 6 (2) (f) of this Act,

You will note that the act does not apply to employees with less than 12 months’ continuous service. Accordingly if you are fired with less than 12 months’ service you can almost alwasy forget about the unfair dismissals act, 1977.

Moreover, section 3 of the same act rules out employees on probation for it states:

3.—(1) This Act shall not apply in relation to the dismissal of an employee during a period starting with the commencement of the employment when he is on probation or undergoing training—
(a) if his contract of employment is in writing, the duration of the probation or training is 1 year or less and is specified in the contract, or
(b) if his contract of employment was made before the commencement of this Act and was not in writing and the duration of the probation or training is 1 year or less.
(2) This Act shall not apply in relation to the dismissal of an employee during a period starting with the commencement of the employment when he is undergoing training for the purpose of becoming qualified or registered, as the case may be, as a nurse, pharmacist, health inspector, medical laboratory technician, occupational therapist, physiotherapist, speech therapist, radiographer or social worker.

Recently, however, a case was brought by a former manager of the Park Hotel in Kenmare to the Labour Court. You may have heard of this hotel as it is owned and run by the high profile Brennan brothers who present that television programme where they go around telling other small business owners how to develop their small hotels or bed and breakfast business.

In this case, however, the general manager of the Park Hotel was employed on a 36 month contract and was dismissed during the probationary period without fair procedures.

Specifically the man was not told of any performance issues, no warning was given that his job may be at risk, no opportunity for representation was afforded to him, he was not given any reasons for the dismissal, and he was not given a right to reply.

The hotel relied on the contract of employment which clearly stated that either party terminate the contract by giving written notice.

How can the employee bring this claim to the Labour Court if the Unfair Dismissals Act, 1977 excludes employees who have less than 12 months continuous service?

Labour Court and Industrial Relations Acts

The employee can bring a claim for unfair dismissal to the Labour Court under the Industrial Relations Act, 1969. This is precisely what happened in this case involving Francis Brennan’s Park Hotel and the Labour Court recognised that employer was entitled to dismiss the employee during the probationary period.

The Labour Court found, however, that the employee is still entitled to fair procedures and natural justice and in this case found that this did not occur.

Accordingly, the Labour Court recommended that the employer pay €90,000 in compensation for the unfair dismissal. Note that this is a ‘recommendation’ and is not legally enforceable.

Why would an employee go through this procedure and perhaps incur legal costs if he only ended up with an unenforceable recommendation which the employer can ignore?

Only the employee can answer that question but he may have hoped that the publicity surrounding the case may have persuaded the employer to settle his claim to avoid reputational damage to the hotel.

He may also have hoped that the employer would accept the moral or persuasive authority of the Labour Court’s recommendation and pay out.

Or he may have taken the case on a point of principle and to restore his good name and professional reputation if he felt that they were damaged as a result of the termination.

Conclusion

If you are an employer you may or may not, depending on your business, be concerned about reputational damage or the likelihood of industrial relations action on foot of a Labour Court recommendation which you may intend ignoring.

If you are concerned then you should ensure fair procedures and natural justice in the termination of any employee’s employment, even those on probation.

If you are an employee with less than 12 months service you may consider going this ‘industrial relations act’ route to the Labour Court; but you may end up with an unenforceable recommendation.

Read the full decision of this case here.

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.