Categories
Redundancy Unfair Dismissal

Unfair redundancy? Your options and the factors to consider

redundancy claims

Have you been unfairly made redundant?

Perhaps you have a sneaking suspicion that it was not really a genuine redundancy situation and the employer simply took the opportunity presented by the Covid 19 pandemic to get rid of you.

Or maybe the redundancy was genuine but you feel you were unfairly selected, that someone else should have been chosen and it would have made much more sense.

I have met many employees who have found, or find, themselves in this type of situation. The question arises: what can you do about it?

Unfair dismissal

The main cause of action will be a case for unfair dismissal on the grounds that

  1. It is a sham redundancy, not a genuine one or
  2. You have been unfairly selected.

If you can prove that your case falls into one of these categories you may well win your case for unfair dismissal. If you do the remedies open to you, at the discretion of the adjudication officer at the Workplace Relations Commission, will be

  1. Financial compensation
  2. Reinstatement (in your old job)
  3. Reengagement (in a new position in the company)

There is a problem, however. If you have been unfairly dismissed and you prove it was not a genuine redundancy it is almost certain that whatever redundancy payment will have to be offset against your financial loss, as calculated by the provisions of the Unfair Dismissals Act 1977.

This could mean, in effect, that you would be no better off by bringing such a claim. This will depend, however, on two things:

  1. How long you were unemployed after the termination
  2. How much of a redundancy payment you received

Examples

Let’s assume you have been paid €15,000 redundancy and you succeeded getting a new job within a month of being terminated from the old one. Your financial loss in this situation will be only 1 month’s salary, therefore if you are successful with an unfair dismissal claim you will be looking at financial compensation of 1 month’s salary. Factor in legal fees for preparation for and representation at the WRC hearing and you may decide you are better off putting the whole thing behind you and moving on.

On the other hand you may have been paid only statutory redundancy, let’s say €10,000, and you have been unemployed for 9 months after the termination. In this case you will be better off if you are successful with an unfair dismissal claim and remember you could also win reinstatement or reengagement.

Other considerations which arise will be whether you believe the relationship between you and the old employer is totally ruptured and damaged, or would it be convenient for you to get your old job back, or an alternative position.

A further factor needs to be considered: did you sign a settlement/termination agreement? Because if you did, and you had the benefit of legal advice, you may have waived your rights to bring any claims against your former employer.

Conclusion

You will note that you need to give your situation serious thought and consideration and weigh up all the options, taking into account the issues raised above. You may have additional considerations and factor to consider as each case is unique.

Legislation

Redundancy Payments Act 1967

Unfair Dismissals act 1977

Categories
Unfair Dismissal

Employee paid in lieu of notice-when did employment end for unfair dismissal purposes?

If you are unfairly dismissed and you are paid in lieu of notice when does your employment end? When you have been given the notice and payment, or when the notice period would have expired?

This is of huge significance because if you want to bring a claim for unfair dismissal, for example, you need 12 months’ service in the workplace. What happens if you are fired just short of reaching the 12 months’ service period?

This was the issue in the case of Action Health Enterprises Limited and Michael D’Arcy. D’Arcy brought a claim for unfair dismissal to the WRC and had been awarded €45,000. This decision was appealed to the Labour Court.

The facts

The dates in this case are of vital importance; D’Arcy commenced as an employee on 31st January 2017 and was dismissed on 30th November 2017. Even though he had a 3 month notice period entitlement in his contract of employment he was given a letter telling him that he was being paid for the 3 months but his employment ended immediately.

He received the payment on 17th December 2017 after his solicitor had sent a letter seeking payment. His contract had provided

Termination with Notice:

“… employment may be terminated at any time by either you or the Partnership giving the other party at least three months ‘prior written notice, or statutory notice, if greater.”

“Where notice of termination of our employment is given, whether by you or the Partnership, the Partnership will have the right to:

Pay you in lieu of notice the amount of your entitlement to basic salary in respect of all or part of such notice period;”

Action Health Enterprises Limited appealed the WRC decision to the Labour Court on the basis that D’Arcy did not have the necessary 12 months’ service to bring an unfair dismissal claim.

Action Health argued that the employment ended on the giving of notice and brought the employment to an immediate end by exercising its contractual right to pay him in lieu of notice.

He argued that the Minimum Notice and Terms of Employment Act 1973 does not prevent the parties agreeing to accept payment in lieu of notice and, accordingly, the date of termination was 30th November 2017. If this was accepted then D’Arcy did not have the 12 months’ service to bring the unfair dismissal claim.

It was also argued that even if no notice was given to the employee the earliest date of termination would be the date that complied with the provisions of the Minimum Notice and Terms of Employment Act 1973. This would be 1 week later giving a date of dismissal of 7th December 2017 which would have been insufficient for the employee to bring the claim.

The argument was that there is nothing in the Minimum Notice and Terms of Employment Act 1973 or in the Unfair Dismissals Act 1977 preventing an employee from agreeing to pay in lieu of notice.

Sections of “Dismissal Law in Ireland” by Mary Redmond were advanced by the employer’s legal representative:

“If a contract lays down a notice period, it will technically be a breach of contract to give pay in lieu of notice unless this right is reserved to the employer. If it is, and an employee accepts payment of wages in lieu of notice, the date of dismissal will be the date on which termination takes effect, as the contract will have been determined in accordance with its terms. If there is no right to give pay in lieu of notice in the contract the EAT will treat the case as a no notice one and will add on the contractual or statutory notice whichever is the greater”.

As an aside, it is worth noting that the only circumstances in which the legislature saw fit to provide that notice should be automatically added onto service was for the purpose of calculating the amount of a redundancy payment.

Section 7 Minimum Notice and Terms of Employment Act, 1973 states:

7.—(1) Nothing in this Act shall operate to prevent an employee or an employer from waiving his right to notice on any occasion or from accepting payment in lieu of notice.

(2) In any case where an employee accepts payment in lieu of notice, the date of termination of that person’s employment shall, for the purposes of the Act of 1967, be deemed to be the date on which notice, if given, would have expired.

D’Arcy’s legal team argued that the contractual notice provision supersedes the Complainant’s entitlement under the 1973 Act, therefore, the Complainant was entitled to three months’ notice of termination. They argued that the date of dismissal for the purpose of the Unfair Dismissals Act 1977 includes the notice period, whether worked or not.

They relied on Redmond on Dismissal Law which states:

“the Unfair Dismissals Act, as amended, deems the date of dismissal to be the date on which notice, had it been given, would have expired. In practice, this can mean there is a crucial distinction between the employee‘s date of termination (when he or she ceased to be an employee pursuant to the contract of employment,) and his or her, date of dismissal (the date that is reckonable for the purposes of establishing the length of services qualification and the time limit rules under the Unfair Dismissal legislation)”.

In other words even where the parties agree to contractually bring the contract to an end the parties cannot override the statutory provisions of  the Unfair Dismissals Act 1977 concerning the date of dismissal.

Labour Court Decision

The Labour Court had to decide whether the date of dismissal for the purpose of the Unfair Dismissals Act 1977 was 30th November 2017 or 3 months later when the notice period would have ended. If it was 30th November 2017 he did not have the necessary service to bring the claim; if 3 months’ later he did have the necessary service.

Firstly, the Labour Court recognised that this was a complex issue and was not “definitively settled”.

Secondly, they held that the employee could waive his right to notice in accordance with the 1973 act as follows:

“Nothing in this Act shall operate to prevent an employee or an employer from waiving his right to notice on any occasion or from accepting payment in lieu of notice”.

It noted that when he was dismissed he did not receive any pay in lieu of notice. He only received it when his solicitor wrote to the employer seeking it.

This action, the Labour Court held, approbated or approved the contract because he sought the payment pursuant to the term of the contract which referred to terminating the contract without notice and the employee accepting payment in lieu.

The Labour Court held that the date of dismissal is 30th November 2017 as that was the date the employment came to an end in accordance with his contract of employment. That being the case he did not have the necessary locus standi to bring the unfair dismissal claim under the Unfair Dismissals act 1977.

The Labour Court overturned the WRC decision. Read the full decision here.

Categories
Redundancy Unfair Dismissal

Disciplinary Record and Attitude Cannot Be Used in an Objective Selection for Redundancy

redundancy claims
Redundancy selection criteria must be objective

This case involved a man who brought a claim for unfair dismissal arising from his redundancy. His claim was founded on his contention that he was unfairly selected for redundancy and subjective criteria, which are personal to the employee, should not have been considered.

Background

The employer in this case was funded by a Government Department but funding was only going to continue to be available for 7 supervisors, from 9, into the future. One supervisor took voluntary redundancy and one further redundancy was needed.

A redundancy selection matrix and procedure was adopted but the Complainant was sceptical about the criteria being used. An interview panel was set up and interview meetings, along with an application form which had been completed by all supervisors, was used to arrive at the choice of who would be made redundant.

The Complainant was chosen for redundancy and he appealed this decision. His appeal was unsuccessful and the employer’s position was that the Complainant was chosen for redundancy because he had the lowest score of all the applicants.

He received a redundancy payment of €9,336.

The employer defended the redundancy procedure adopted and pointed out that it involved an external HR consultant and a matrix of criteria which would allow scores to be given to the employees.

The employer argued that the function of the WRC was not to look behind the matrix and procedure adopted unless there was manifest unfairness.

The Complainant argued that he had unfairly received a verbal warning in the course of employment and it was unfair, and that the matrix adopted by the employer was unfair and unbalanced. He also argued that last in first out should have been used,which would have saved his employment.

Moreover, he argued that it was improper to use attendance, disciplinary record and attitude towards colleagues in the matrix because these criteria were linked to the person, not the position that was being cut.

He relied on JBC Europe Limited –v- Jerome Ponisi [2012] 23 E.L.R 70 as authority for the proposition that redundancy cannot be used as a cloak for weeding out employees who are perceived to have competence or health or age-related issues.

The complainant also pointed out that a supervisor with 5 years less service scored higher than him in the matrix adopted, and he disagreed with this.

Findings of the WRC adjudication

The adjudicator pointed out that the redundancy must involve a genuinely fair selection process and the termination must arise from a real redundancy. The burden of proof was on the employer to prove it was genuinely redundancy related and must be able to justify the selection process.

The WRC adjudicator was satisfied that a genuine redundancy existed and this was the reason for dismissal. Regarding selection for redundancy she referred to Boucher v Irish Productivity Centre R92/1992 which held:

“to establish that he acted fairly in the selection of each individual employee for redundancy and that where assessments are clearly involved and used as a means for selection that reasonable criteria are applied to all the employees concerned and that any selection for redundancy of the individual employee in the context of such criteria is fairly made”.

The adjudicator held that selection criteria cannot be based on subjective assessments of employees. The assessment must have independent, objective and verifiable criteria.

She held: In Bunyan v United Dominions Trust (Ireland) Ltd [1982] I.L.R.M. 404 the EAT endorsed and applied the following view quoted from NC Watling Co Ltd v Richardson [1978] IRLR 225 EAT (ICR 1049)

“the fairness or unfairness of dismissal is to be judged by the objective standard of the way in which a reasonable employer in those circumstances in that line of business, would have behaved. The tribunal therefore does not decide the question whether, on the evidence before it, the employee should be dismissed. The decision to dismiss has been taken, and our function is to test such decision against what we consider the reasonable employer would have done and/or concluded.”

The adjudicator held that the Complainant was unfairly dismissed because he was unfairly selected by reason of the use of subjective criteria of disciplinary history, attitude towards his managers and not being a cooperative colleague were taken into consideration and should not have been.

She held that a “fair scoring system” was not in place for selection.

The adjudicator noted that he had not suffered any financial losses because he had received a redundancy payment and had secured new employment but awarded him 4 weeks gross remuneration-that is, €2,688.00-to reflect the finding that he was unfairly selected and therefore unfairly dismissed.
Read the full decision of the Workplace Relations Commission here.

Categories
Unfair Dismissal Workplace Relations Commission

How to Make a Decision to Bring an Employment Claim to WRC or Not

Are you torn between bringing a claim to the Workplace Relations Commission (WRC) or walking away from the issue?

I meet employees on a weekly basis who face this decision. On the one hand they feel they have been treated unfairly, and perhaps unlawfully, in the workplace. But they face the tough decision to submit a claim to the WRC or even commence legal proceedings in the civil courts or walking away, forgetting about it, and putting the difficulty behind them.

It is not an easy decision.

Let’s take a look at some of the factors you will need to consider.

Justice

Many employees speak about getting justice and wanting to do something about what they see as the essential unfairness of how they have been treated by the employer. This appears to be a noble, principled position to adopt.

But if it involves a claim which will inevitably involve time, stress, and legal costs and the potential financial payback does not exceed the costs incurred it may be prudent to have a second think about bringing the claim.

Let me give you a simple example.

Let’s assume you have been dismissed from your job and you believe you have a strong case for unfair dismissal and you are anxious to pursue it.

Let’s assume, too, that you have been successful in getting a new job quickly after the termination of the old one and you have only been out of work for 3 weeks.

The Unfair Dismissals Act 1977 provides that if you succeed in your claim to the WRC the compensation you can be awarded is “financial loss”. Financial loss is essentially loss of pay or remuneration as a result of your sacking.

But your financial loss, assuming you start the new job 3 weeks later, is only 3 weeks’ wages.

Now, let’s assume you were taking home €500 per week, then your loss is €1,500. In these circumstances, if you are successful the WRC adjudicator can award you a maximum of 1 month’s salary which is approximately €2,000.

So, you might win €2,000 if you succeed but you will have to pay your own legal costs and it is extremely unlikely that your legal costs will not comfortably exceed €2,000. And then you must consider the stress of putting yourself through the whole process and the possibility that you will lose, in which case you are now out of pocket and your sense of unfairness and injustice has just increased significantly.

Now consider you do win but the employer has deep pockets and appeals the WRC decision to the Labour Court. You will have more legal costs and there is the possibility of your win at the WRC being overturned and you being further out of pocket.

Let me be clear: I am not trying to put you off, you may be perfectly happy to pursue your claim on a point of principle and let the cards fall where they may. There may well be an aspect of clearing or vindicating your good name and that is worth fighting for.

But you do need to think through the process from start to finish and weigh up the pros and cons and look at the potential outcomes.

For example, your case would be a completely different one if you were out of work for 6 months and had tried your best to get a new job. In this situation your financial loss will be 6 months’ wages so the financial analysis of your potential claim is radically different. To put it bluntly, it may well be worth a punt.

Justice v financial reality

You may have to weigh the justice or principle of your case against the financial reality and decide whether to pursue the matter or not. This can only be done by a cold headed analysis of the potential claims you have, the possible outcomes and remedies, and the probability of each outcome.

Conclusion

Bringing a claim to the WRC, Labour Court, or civil courts is an easy thing to do. But before you decided to do so you should consider the overall situation, what the potential outcomes might be, and the various steps along the way to the final conclusion, not just the first, easy step of submitting a claim.

You need to weigh it up like the moves in a chess game. Thinking only 1 move ahead is bound to end in disaster.

To assist with your decision, and to ensure you know what factors to consider, it’s a smart idea to get professional advice.

Categories
Unfair Dismissal

Part Time Bus Driver Wins Reinstatement and Full Salary Retrospection

Labour Court Appeals

Are you an employer? How would you feel about having to pay a dismissed employee’s salary from the date of dismissal to the date of the hearing? Or even to the date of the decision of the adjudication officer?

And how would you feel about accepting the employee back into his old job?

That is what happened in the case involving a part time school bus driver (ADJ-00013201 An Employee v a Bus Company).

In this case the employee who was dismissed for alleged theft not only won his claim for unfair dismissal, but it was ordered by the adjudicator that he be reinstated in his previous job and paid all his salary from the time of dismissal (August 2017).

Background

The back story to the case is the part time bus driver was accused of theft in the workplace; he allegedly removed used wheel rims from the employer’s premises. The employee’s position was that he had permission from the Garage Foreman.

The employer’s services manager carried out an investigation and following this investigation the employee received a letter telling him that his employment was being terminated.

The Employee’s Case

The employee’s case was the investigation and disciplinary parts of the procedure which led to his dismissal were carried out by the same person, the Services Manager, and this rendered the termination unfair by reason of the absence of fair procedures-that is, the same person carried out the investigation and disciplinary parts of the process.

The employee also relied on the letter he received which stated that “following an investigation” he was being terminated as evidence of the 2 stage (investigation and disciplinary) procedure.

He also argued that his appeal was never heard.

The Employer’s Case

The employer’s case was that the employee was brought to a disciplinary meeting concerning the alleged theft of property-in excess of 20 wheel rims-and admitted taking the property but claimed to have permission. The employer found that this was not the case and decided he would be dismissed within 7 days and given the right to appeal.

The employer did concede that his appeal had not been heard up to the day of the WRC hearing due to the large volume of appeals to be dealt with by the appeals board and the illness of some members.

The Adjudicator’s Decision

The Workplace Relations Commission Adjudicator stated that his job was not to assess the innocence or guilt of the employee in respect of any allegations against him; the job of the adjudicator was to decide whether the decision of the employer was reasonable. In this context he stated the employer must prove the dismissal was fair.

In this regard he held that the involvement of the Services Manager in both the investigation stage and disciplinary/decision making stage of the procedure was lacking in fair procedures.

He stated,

“Having purportedly conducted a preliminary investigation, I find it inappropriate that the Services Manager would have then participated as the disciplining officer, on whose decision the Complainant was dismissed.”

He also referred to a Labour Court finding on this issue of separating the investigative stage from the decision making stage in the case Joseph Brennan Bakeries v Rogers (UDD1821). In that case the Labour Court held:

“The Court considers that the multiplicity of roles undertaken by TG [ the General Manager] in the process calls into question the fairness of the procedure. TG was the person who initiated the investigatory procedure and he oversaw the procedure himself. That procedure resulted in a disciplinary procedure which TG also oversaw. The Court is satisfied that the within enterprise is of a nature which afforded the Respondent the opportunity to ensure a clear separation of investigation and disciplinary processes by selection of available management level personnel to carry out the different stages of the procedure.”

He also found that there was a lack of objectivity and pre-judgment as he accepted the statement of the employee as follows:

“According to the Complainant, the Services manager stated, inter alia, that he (the Complainant) had been “caught stealing rims” and that “they are looking for your head upstairs”.”

The adjudicator also found that there was no written note of he investigation carried out and none had been given to the employee prior to the disciplinary hearing. This was fundamentally lacking in fair procedures.

In summary, the Adjudicator found:

“Taking all of the issues into consideration, I find there to be a distinct lack of objectivity and independence in the carrying out of the investigation and disciplinary processes which ultimately led to the Complainant’s dismissal. In this regard, I find that, in the circumstances, the Respondent’s decision to dismiss the Complainant must be considered as unfair.

This view is further undermined by the fact that the Complainant’s appeal of the dismissal decision has not been heard. While I note the rationale presented by the Respondent in relation to the delays with regard to the conducting of the Appeal Hearing, I find that it has compounded the shortcomings of the disciplinary process up to that point.

I find that the Respondent’s decision to dismiss the Complainant is unfair. In that context and taking into consideration the fact that an Appeal Hearing has not been conducted, I direct that the Complainant be reinstated, with effect from the date of dismissal, 25 August 2017, with full salary retrospection to apply.”

Read the full decision here.

Note: this hearing was held on the 24th July, 2018 and the decision is dated 28th December, 2018. I do not know whether the salary retrospection is from the day of the hearing or the day of the decision. Nor do I know whether the employer has appealed to the Labour Court.