EMPLOYMENT APPEALS TRIBUNAL
CLAIM(S) OF: CASE NO.
EMPLOYEE claimant UD1403/2012
RP845/2012
against
EMPLOYER - respondent
under
REDUNDANCY PAYMENTS ACTS, 1967 TO 2007
UNFAIR DISMISSALS ACTS, 1977 TO 2007
I certify that the Tribunal
(Division of Tribunal)
Chairman: Ms C. Egan B L
Members: Mr. W. O'Carroll
Ms H. Murphy
heard this claim at Galway on 6th September 2013
Representation:
_______________
Claimant(s) : In Person
Respondent(s) : In Person (Director of respondent company )
The claim under the Redundancy Payments Acts 1967 to 2007 was withdrawn by the claimant at the commencement of the hearing.
Respondent’s Case
Two directors of the respondent company gave evidence on behalf of the company. The company operates as tourism and development association since the early nineties providing services to the local community. It is based in the west of Ireland and receives funding from a series of community fundraising schemes. It also receives Pobal funding. The company moved to a larger premises in 2009 and operated a tourist office from the new premises. The company was also involved in the local courthouse restoration project and the publication of a local newsletter.
By late 2011 it became apparent that the company had suffered a serious deterioration in their overall financial resources. Tourism numbers had reduced and income was reducing accordingly. The financial deterioration was also highlighted to the company by Pobal and the company could not sustain another year of loss making in 2012. The company had to introduce cost savings measures and the operation and profitability of the tourist office was now a major issue. The company had 5 employees in the tourist office, 3 full-time and 2 part-time. The claimant was employed on a salary of €35,000.00 which was much greater than the other employees.
The company had to restructure their office operation and as part of the overall cost saving measures had to implement pay reductions. The company held a series of meetings with the claimant regarding proposals to re-structure the office, including a staff incentive scheme and to introduce pay reductions. The claimant, who was employed as a manager of the tourist office, refused to engage in the process. She refused to accept a reduction to her pay or proposals to re-structure the office. As a result the company was left with no option but to close the tourist office on 10 May 2012 and it remains closed to date. The claimant was made redundant and was paid her statutory redundancy entitlement.
Claimant’s Case
The claimant gave evidence that she commenced employment with the respondent in 2006. She was employed as a manager in the tourist office which operated from a small office. In 2006 her starting salary was €30,000.00 and this was increased to €35,000.00 in 2008 when the respondent moved to a larger premises. As a manager of the tourist office she also oversaw the retail element of the courthouse project and the newsletter. She was aware that the company was struggling financially and tourism numbers were reducing. She was aware that the finances of the company had deteriorated.
She gave evidence that she had already taken a reduction to her salary in 2011 and she refused to take another reduction to her pay. She believed that the re-structuring process was aimed at removing her and another employee from the company. She was put under continual pressure from the directors to accept the re-structuring proposals. She felt that there was a breakdown in trust between herself and the directors. Her relationship with the directors deteriorated following a meeting on 18 January 2012. She was asked to stand down as manager of the tourist office and refused. She refused to accept the proposed changes to her contract of employment or a further reduction in her pay. While she accepted that the company was operating at a loss she believed that this position could have been turned around and she did several financial projections for the company. She was made redundant in May 2012 and has been unemployed since the termination of her employment. She has completed an art and business course and has started up her own business in the past week.
Determination
The Tribunal considered the evidence adduced at the hearing by the parties. The Tribunal accepts that it was necessary for the respondent to restructure its business based on the deterioration in the financial reserves of the company. The respondent tried to implement a restructuring process but this process failed due to the lack of co-operation of the claimant. The Tribunal also notes that the claimant failed to accept a proposed reduction to her pay in January 2012. The Tribunal notes that the tourist office closed down in May 2012 and remains closed to date. The claimant’s position has not been replaced.
In those circumstances the Tribunal finds that the actions of the claimant were unreasonable in not accepting the proposed restructuring changes to the company and a proposed reduction to her salary.
The Tribunal finds that the claimant was not unfairly dismissed and her claim under the Unfair Dismissals Acts 1977 to 2007 fails.
Sealed with the Seal of the
Employment Appeals Tribunal
This ________________________
(Sgd.) ________________________
(CHAIRMAN)