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.

The Statutory Penalties for Breaches of Employment Law in Ireland

Are you aware of the range of penalties that are set down in legislation in Ireland for breaches of employment law?

There is a large number of statutes/acts dealing with all aspects of employment law in Ireland. These acts cover overnighting from unfair dismissal to working time to payment of wages to health and safety to annual leave and rest breaks, etc.

In addition to these penalties and employee can always go to the Civil Courts for common law claims such as breach of contract, personal injury, negligence, health and safety breaches, breach of constitutional rights, etc. That is another day’s work.

This piece is going to look at the penalties and redress for employees as set out in statute, that is, the various acts on the statute book.

Regardless of whether you are an employer or employee, you should find it useful.

Unfair Dismissal/Constructive Dismissal

The redress is set out in section 7, Unfair Dismissals Act, 1977, and in summary comprises

  1. Reinstatement or
  2. Reengagement or
  3. Compensation of up to 104 weeks’ remuneration in respect of the financial loss due to the dismissal.

If there is no financial loss an employee can be awarded 4 weeks’ remuneration.

Working Time/Rest Breaks

The penalties are set out in section 27, Organisation of Working Time Act, 1997:

  1. Require the employer to comply with the relevant provision of the act
  2. Compensation of up to 2 years’ remuneration.

Written Terms of Employment

Failure to provide a written statement of terms and conditions of employment within 2 months of starting can be punished as set out in section 7 of the Terms of Employment (Information) Act, 1994.

The WRC adjudicator can order the employer to give the statement to the employee and can award up to 4 weeks’ remuneration by way of compensation.

Protected Disclosures/Whistleblowing

The Protected Disclosures Act, 2014 provides severe penalties in section 11 for dismissal of an employee for making a protected disclosure:

  • 260 weeks (5 years) remuneration

The employee can also bring a tort action for having suffered detriment as a result of making a protected disclosure, as set out in section 13, Protected Disclosures Act, 2014, and can seek an order from the Circuit Court as set out in section 11 of the act preventing dismissal prior to the determination of a claim for unfair dismissal.

Payment of Wages

Section 6, Payment of Wages act, 1991 sets out the penalties for breaches of the act. These include

  • Compensation of the net amount of the wages which would have been paid the previous week prior to the deduction/non payment or
  • Twice the net amount of wages that would have been paid to the employee in the week immediately preceding the deduction or payment

Minimum Notice

Compensation can be awarded pursuant to Minimum Notice and Terms of Employment Act, 1973: “may award to the employee compensation for any loss sustained by him by reason of the default of the employer.”

Agency Workers

Penalties for breach of Protection of Employees (Temporary Agency Work) Act 2012 are set out in schedule 2 of the Act. It states that the WRC can order rectification of whatever breach of the act is proved, including reengagement or reinstatement, and/or order compensation of up to 2 years’ remuneration be paid to the employee.

Adoptive Leave, Carer’s Leave, Parental Leave

Breach of the adoptive leave provisions of the Adoptive Leave Act, 1995 can see compensation of up to 20 weeks’ remuneration awarded to the employee, or the WRC making whatever directive order it feels is expedient in the circumstances.

Carer’s leave: a WRC adjudicator can award a grant of carer ’ s leave to the employee of such length to be taken at such time or times and in such manner as the adjudication officer may specify, and/or up to 26 weeks’ compensation.(Carer’s Leave Act, 2001).

Parental Leave and Force Majeure Leave:  an adjudicator can award (a) the grant to the employee of parental leave of such length to be taken at such time or times and in such manner as may be so specified, and/or compensation of up to 20 weeks’ remuneration.(Parental Leave Act, 1998).

Maternity leave: breaches of the employees entitlement can lead to an award of compensation of up to 20 weeks’ remuneration and or grant of the leave to which the employee is entitled.(Maternity Protection act, 1994).

Transfer of Undertakings

Complaints about breaches of S.I. No. 131/2003 – European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003 can lead to compensation being awarded depending on which regulation has been breached.

The compensation can range from a maximum of 4 weeks’ remuneration to 2 years’ remuneration.

Part Time Workers

The Protection of Employees (Part-Time Work) Act, 2001 is the relevant act for part time workers.

It provides that the WRC adjudicator can require the employer to comply with the relevant provision and/or award 2 years’ remuneration to the employee.

Fixed Term Workers

The Protection of Employees (Fixed-Term Work) Act 2003 is the relevant act for fixed term workers. Section 14 of the revised act provides the WRC adjudicator can:

(b) require the employer to comply with the relevant provision,

(c) require the employer to reinstate or reengage the employee (including on a contract of indefinite duration), or

(d) require the employer to pay to the employee compensation of such amount (if any) as the adjudication officer considers just and equitable having regard to all of the circumstances, but not exceeding 2 years ’ remuneration in respect of the employee ’ s employment.

Redundancy

The Redundancy Payments Act, 1967, section 7 sets out the employee’s right to a redundancy payment. Section 39 allows you to appeal the amount you have been awarded.

The Protection of Employment Act, 1977 also obliges the employer to inform and consult with employees in a collective redundancy situation. Section 11 of the Act sets out the penalties for the employer’s failure to consult and notify: a fine of up to €5,000 on summary conviction in respect of a breach of section 9 or section 10.

Discrimination and Equality Based Claims

Breaches of the Employment Equality Act, 1998 can see redress being ordered pursuant to section 82 of the Employment Equality Act, 1998:

Various orders including for re-engagement, re-instatement or compensation of up to 2 years’ remuneration or €40,000, whichever is the greater.

€13,000 can be awarded in contravention of the law in relation to a discriminatory claim in relation to access to employment.

Equal Status Acts Breaches

Equal status breaches can be penalised in accordance with the Equal Status Act, 2000. This protects you in relation to discrimination in respect of the supply of goods or services.

The maximum amount that can be awarded is the amount of the District Court limit in civil cases in contract (€15,000).

Minimum Wages

The National Minimum Wage Act, 2000 protects employees in relation to minimum wage rates. Complaints can be dealt with under section 26 of the act. The adjudication officer can order that the shortfall be rectified and paid to the employee, and the employee can also be awarded reasonable costs in respect of bringing the claim.

The employer can also be prosecuted in the District Court for breaches of this minimum wage act.

Health and Safety

Breaches of the Safety Health and Welfare Act 2005 can see an adjudication officer awarding compensation of such amount as he feels equitable in the circumstances for breach of section 27 of the act, which protects employees from penalisation or dismissal for making a complaint in respect of health and safety in the workplace.

Conclusion

The list above is not definitive, but certainly covers the most common types of employment law claim that will be brought to the WRC (Workplace Relations Commission), or Labour Court. A WRC adjudicator has a wide range of discretion for breaches of any particular act, so the various acts referred to above set out the maximum awards possible.

A Warning Employment Law Story for Employers

employers unfair dismissal story

Let me tell you a story.

Last year a small shop owner in Westmeath, Mick*, faced a claim from a dismissed employee on the grounds of unfair dismissal. The employee, Séamus*, worked for Mick for about 18 months, or so.

The background was typical enough.

Seámus started off well in the job, full of enthusiasm. Mick hoped Séamus would take the pressure off him once he learned the ropes and got a bit of experience.

As time went on, however, and particularly after Séamus had been in the job for 12 months, his performance dropped.

He showed less interest in the job, got himself a new girlfriend, a second hand car, and had much less interest in working at the weekend, especially on a Saturday evening.

His timekeeping got sloppy, too, and there were complaints from customers that his attitude and tone in the shop was poor.

One Saturday in May, Mick had Séamus rostered to work on Saturday because Mick was going to his brother’s child’s First Holy Communion. He was looking forward to the break, and the few pints and a bite to eat with “herself”.

An hour before Séamus was due to start Mick received a call from Séamus’s mother telling him that he wasn’t well and wouldn’t be able to come in.

Mick was furious, absolutely fuming, and suspected the only thing wrong with Séamus was a stonking hangover because he was seen out in the pubs on the Friday night.

Mick had to stay in the shop because he was short staffed,  and had to pass up going to the First Holy Communion. He felt really let down-gutted, in fact.

On Monday, Mick resolved to tackle Séamus about his absence on Saturday and get to the bottom of it.

When Monday came around it transpired Séamus had made a remarkable recovery, so much so that he starred for the local junior team on the Sunday.

When Mick went to discuss the situation with Séamus he was not in the best frame of mind, especially after hearing about the footballing exploits of Séamus the previous day.

The conversation between the two men started off on a bad footing, and soon went downhill rapidly.

It ended up with Mick telling Séamus that he “was taking the piss” and he wouldn’t stand for it any longer He said he was very disappointed with him, and heard he had played football the previous day.

“I can’t trust you now, I’m afraid”.

He told him he could go back home to his mother, and play his football but he wouldn’t be working for Mick anymore.

He would have his P.45 in a few days when the bookkeeper came in.

About a fortnight later a solicitor’s letter arrived at the shop. The letter stated that Séamus had “clearly been unfairly dismissed” and that he wanted, and was entitled, “to be compensated for his loss of income”.

Soon after Mick received a letter from the WRC (Workplace Relations Commission) telling him that an unfair dismissal claim has been made by Séamus.

But that was only the start of it as there was also claims for failure to give the required notice, failure to give a written contract, failure to give proper rest breaks, failure to pay the correct pay for annual leave and public holidays.

Mick went to his own solicitor about the case and made it clear he would not consider taking Séamus back, or compensating him.

His exact words were “I’ll have a beard sweeping the floor before I’d give that smart-arse waster his job back or let him back into my shop”.

Approximately 20 weeks later Mick’s solicitor received notice of the hearing date with the WRC in Lansdowne house, Dublin 4.

Mick’s solicitor strongly advised him to try to settle the case because on the unfair dismissal claim alone he was in a very weak position, having failed to follow any procedure at all.

To make matters worse, he was offside in relation to the minimum notice claim and the written contract claim, so these could not be won either.

As for the claim about getting the right rest breaks? Mick was adamant Séamus had got enough breaks, but unfortunately for Mick he had no records that he should have kept in accordance with the Organisation of Working Time Act Regulations.

So, Mick had no choice-he had to settle. It killed him but it could have been worse if the case went ahead to a full adjudication hearing.

All in all, the whole mess cost Mick approximately €23,500.

The maximum Séamus could have been awarded for the unfair dismissal would have been 2 years’ salary, so the €23,500 it cost Mick was being viewed by Mick in that context.

Nevertheless, it was €23,500 of after tax income he could ill afford to be handing out in compensation and could have used it to replace a fridge or help upgrade his deli.

Lesson for Employers

Mick made a fatal mistake in this tale. He dismissed without any procedure, and let his hurt and pride overrule his good judgment.

If an employee is dismissed without a fair or proper procedure, almost always it will constitute an unfair dismissal.

Employers also need to be careful to ensure that all employees have a written contract of employment, and to maintain work records and records of rest breaks and annual leave.

 

*Note: Mick and Séamus are not the real names of employer and employee.

The Range of Reasonable Responses in Unfair Dismissal Cases

unfair dismissal claims

If I am representing an employee in an unfair dismissal case I will nearly always argue that the sanction of dismissal was excessive and disproportionate.

That a reasonable employer would not have gone that far, and a lesser sanction would have been more appropriate.

The employer, or his representative will claim that the action was reasonable.

What is reasonable? What is excessive? Disproportionate?

Who decides? The employer? Or the decision making body such as WRC or Court?

Courts and decision making bodies in unfair dismissal cases, when assessing whether an employer’s response to penalising the employee in an employment law dispute, have long recognised that they will not substitute their judgment for that of the employer.

This means that once the employer’s sanction of the employee falls within a range of reasonable responses, the WRC or Court will not take on the role of employer in deciding what is appropriate in the circumstances. Instead, it will decide whether the employer’s response falls within a range of reasonableness in the circumstances.

What’s appropriate and reasonable in the circumstances will also vary widely, and what may be an appropriate penalty in one workplace may be disproportionate and excessive in another.

Let’s take a look at the principle of the range of reasonable responses, and how the decision making bodies come to an assessment of the employer’s decision.

The Employment Appeals Tribunal (EAT) have held,

“………the task of the Tribunal is not to consider what sanctions the Tribunal might impose but rather whether the reaction of the Respondent and the sanction imposed lay within the range of reasonable responses”. (McGee v Peamount Hospital)

The decision making body will look at the circumstances of each case and decide whether the response of the employer falls within the band of reasonable responses. In doing so, the WRC or Court will look at things like

  • The gravity of the conduct leading to the dismissal
  • The size of the employer’s workforce and resources
  • The employee’s background and length of service
  • Any other relevant facts.

It is important to note that what may be reasonable for one employer may not be held to be reasonable in respect of another employer. This is because a large employer will have far more resources than a small outfit and will be able, perhaps, to consider a sanction short of dismissal, such as redeployment or other alternatives, which will not be open to the small guy.

In the UK Lord Denning, MR, stated in British Leyland UK limited v Swift (1981),

“the correct test is..was it reasonable for the employer to dismiss him? If no reasonable employer would have dismissed him, then the dismissal was unfair. But if a reasonable employer might reasonably have dismissed him, the dismissal was fair. It must be remembered that in all cases there is a band of reasonableness, within which one employer might reasonably take one view, another quite reasonably take a different view”.

Conclusion

Unfair dismissal cases can be expensive for employers, and there is many factors which will be considered in deciding whether the dismissal was unfair or not. Two significant factors are the presence or absence of a fair procedure in deciding to terminate, and whether the decision to dismiss falls within the range of reasonable responses.

15 Things You Should Know About Unfair Dismissal in Ireland

unfair dismissal-1

Are you confused about the law surrounding unfair dismissal in Ireland?

Do you know the difference between unfair dismissal and constructive dismissal?

You should, you know, before embarking on an unfair dismissal claim.

Or, if you are an employer, defending such a claim.

In this piece, I am going to give you 15 things in plain language to help your understanding, and prevent you taking out your metaphorical gun and shooting yourself in not just one foot, but both feet.

Let’s get started, shall we?

  1. The important acts are the Unfair Dismissals Act, 1977, which you can access here, and the Unfair Dismissals (Amendment) Act, 1993.
  2. Unfair dismissal arises when the employer terminates the employee’s employment; constructive dismissal arises when the employee resigns due to the conduct of the employer. In an unfair dismissal case the burden of proof is on the employer. In a constructive dismissal case this burden shifts from the employer to employee; this means the employee must prove he/she left the employment due to the conduct of the employer which he/she could no longer be expected to tolerate.
  3. You must bring your claim to the WRC (Workplace Relations Commission) within 6 months of the dismissal, unless you can show reasonable cause in which case you may be allowed 12 months by the WRC.
  4. Redress possible for the employee, if he/she wins, can be reinstatement, re-engagement, financial compensation.
  5. Financial compensation is financial loss incurred by him and attributable to the dismissal as is just and equitable having regard to all the circumstances, subject to a maximum of 104 weeks remuneration. Receipt of social welfare payments by the employee is disregarded in calculating financial loss.
  6. An employee who is on probation, or who has less than 12 months’ employment is excluded from the rights afforded by the unfair dismissal legislation, although there are some limited exceptions, for example a dismissal arising from a discriminatory ground.
  7. A dismissal shall be deemed to be an unfair dismissal, unless there are substantial grounds for it.
  8. A dismissal will not be an unfair dismissal if it arises from one of the following: conduct, performance, redundancy, the employee being in breach of the law in order to continue in his position (eg loss of driving licence if it was essential to hold one to do the job).
  9. An employer must give an employee a written statement of the procedure to be used in dismissing him within 28 days of commencement of employment.
  10. You can also go to the Civil Courts with a common law claim of wrongful dismissal, but you cannot do both-you must choose between the WRC or the Civil Courts. A wrongful dismissal claim is basically a breach of contract claim, for example your contract of employment provided for 1 month’s notice and you only received 1 week’s notice. This is a clear breach of contract and allows you to go to the Civil Courts and sue for breach of contract/wrongful dismissal.
  11. If an employer is going to dismiss on the grounds of competence he should give the employee clear notice of the shortcomings, and sufficient time to improve. A performance improvement plan (PIP) is recommended, and I would recommend that this lasts for 6 months, or thereabouts.
  12. Even if an employee is to be dismissed he/she should be afforded fair procedures and natural justice prior to termination, unless situation if one of gross misconduct which may justify a summary dismissal. Here are 6 steps which should be taken in any fair disciplinary procedure.
  13. An employee on long term sick leave can be dismissed on the grounds of incapacity, that is, he/she is unable to fulfil the contract of employment. There are recommended procedures, however, before an employer should terminate an employee on long term sick leave.
  14. A decision making body such as the WRC or Labour Court will apply 2 well known tests to decide wither the employee was justified in leaving the employment in a constructive dismissal case.
  15. Being dismissed from your job can seem like the end of the world at the time. But some of the most famous, successful people were fired from their job at one time or another. Here is 10 ultra-successful people who were dismissed from their employment.

“I don’t know whether I have a case or not”

“I don’t know whether I should resign and forget about it”

Get professional advice before you take an action that you might regret later.