EMPLOYMENT APPEALS TRIBUNAL
APPEAL OF: CASE NO.
EMPLOYER - appellant UD1792/2011
against the recommendation of the Rights Commissioner in the case of:
EMPLOYEE - respondent
under
UNFAIR DISMISSALS ACTS, 1977 TO 2007
I certify that the Tribunal
(Division of Tribunal)
Chairman: Ms B. Glynn
Members: Mr. D. Morrison
Ms. A. Moore
heard this appeal at Sligo on 27 February 2013, 15 April 2013 and 17 April 2013
Representation:
Appellant:
Respondent:
This case came before the Tribunal by way of an appeal by an employer against a decision of the Rights Commissioner under the Unfair Dismissals Acts, 1977 to 2007 reference r-099670-UD-10/SR. The appellant is the employer and the respondent the employee.
Summary of Evidence
A paint supplier for the appellant gave evidence. He is responsible for providing paint systems and training to body shops all over the country. He provided specialist training for the appellant as, with the new paint composition laws introduced in January 2008 the finishing process had significantly changed. The new system and training was provided from March 2007. A person trained on the old system would not be competent to use the new system. The respondent was not trained on the new system.
The Managing Director (JM) gave evidence. JM is responsible and involved in the day-to-day running of the business; a car repairs/body shop. JM gave extensive evidence on the financial state of the business due to the current state of the economy. The appellant business is known for quality work and as a result mostly deals with expensive cars.
In 2005 two positions were advertised; a panel beater and a spray painter. The respondent applied for and was successful in securing the panel beater position. The respondent stipulated at the interview that he was not interested in painting; the appellant allayed his fears by informing him that there were already numerous painters and that he would not be a painter but a panel beater. The respondent never did any painting for the appellant during his employment and never completed any of the training necessary for him to do so.
The appellant and respondent had a normal working relationship that became strained at times but no more than with any employee. On the 24th of August 2009 JM met with the respondent as the quarter panel on a Mercedes had been damaged during the repair process. The customer had specifically said he did not want to have the panel painted but due to the damage it had to be painted twice as the first paint job had failed. The respondent informed the appellant that the car was repaired and was ready for collection. Ten minutes before the customer arrived the respondent informed JM that there was a major problem and the car would have to be dismantled for the third time. The total cost to the appellant was €3,500. The respondent and another employee were working on the car. JM spoke to both of them regarding his dissatisfaction at the work carried out. As a result of the meeting with the respondent a written warning issued dated the 1st of September 2009.
The respondent did not appeal the warning or mention anything about it to JM. He did not mention bullying or harassment before the solicitors letter of January 2010. JM disputes ever saying ‘let sleeping dogs lie’ in relation to the warning. On receipt of the solicitors letter dated the 29th of January 2010 JM felt upset and threatened. In response to the letter from the Health & Safety Authority informing him that an allegation of workplace bullying had been made JM replied saying he would meet with the respondent and ask him if he wanted to make a complaint, as he had never made an allegation to JM before this.
By letter of the 22nd of February 2010 the respondent was invited to a meeting to take place on the 24th of February 2010. The respondent was also issued with a Contract of Employment at that time; he didn’t have one before that. The respondent’s solicitor replied to the invitation stating that not enough notice was given and that a work colleague is unacceptable as a representative. A further invitation was issued by letter dated the 25th of February 2010 stating among other things that, ‘at no stage has any complaint of grievance being voiced directly by your client to any member of the management of the company. We now have a very clear grievance policy in place which should be followed by your client if he feels he has a grievance.’ During this situation JM felt that he couldn’t discuss the matter with the respondent directly or discuss even the day-to-day work with the respondent which greatly impacted the business.
The appellant wrote to the respondent following a conversation on the 5th of March confirming that a meeting would take place on the 9th of March 2010 to discuss the on-going issues. The respondent said he did not want notes taken at the meeting as the situation was stressful enough that he just wanted ‘a man-to-man’ talk.’ The appellant said that given the circumstances the meeting would have to be formal and notes taken; this had always been the appellant’s intention. The respondent said ‘I’m not worth two pence’ and walked out leaving his employment. By letter of the 10th of March 2010 the appellant outlined what had happened the previous day including the respondent saying that ‘if I wanted a formal meeting I would organise it.’ The letter also outlined how the appellant was now confused as ‘we are unable to understand whether or not to expect you to be in work as you left the premises without any explanation or permission.’ JM did not instruct any staff member to discuss a redundancy or any financial package with the respondent.
The financial state of the business continued to decline so a 10% pay cut was implemented for all the staff on the 26th of April 2010. The appellant now had a very difficult working relationship with the respondent. Following the pay cut the respondent confronted the appellant saying he could not afford the pay-cut and asked ‘what would you do if I rose trouble in the company.’
A meeting finally took place between the respondent and appellant on the 14th of May 2010. This was an investigation meeting into the respondent’s threat in relation to the pay-cut, failure to carry out a work assignment as specified on a job card and failure to communicate regarding a work assignment. The respondent was suspended on full pay with immediate effect. The appellant had made the separate decision to get an independent person to investigate the bullying complaint as the situation had to be resolved. No incidents of bullying were discovered.
The business continued to decline consequently on the advice of the appellant’s accountant the decision was taken to make redundancies, “we looked at reducing the workforce based on who could multi-task.” A matrix was used for the selection process, completed by JM and the workshop manager. The respondents score was practically the same as his comparator (RL) except RL was a trained painter in addition to being a panel beater. As a result the respondent was selected for redundancy and informed of this and given notice by letter dated the 23rd of July 2010. The respondent was also told in person on the 23rd of July 2010. The respondent met with the appellant to collect his redundancy cheque and sign the RP50 form; he did not dispute his selection for redundancy. Over a 2 month period the appellant had received 18 solicitor’s letters on instruction from the respondent so was expecting a ‘barrage’ of letters, only received one letter stating that the respondent was accepting his redundancy under protest. The appellant’s workforce has reduced from 9 staff to 4; JM, his daughter and 2 employees.
At the resumed hearing on the 15 April 2013 the appellant told the Tribunal that the employee had never undertaken any paint work jobs and when he recruited him he had specifically applied for a panel beating job because painting had become too complicated. The issue with the Mercedes job in August 2009 was as a result of the employee not making the employer aware of a problem with the job before the client was contacted to collect the vehicle. The employee was asked to check that the job was fully completed to a high standard. This failure on the part of the employee caused the witness embarrassment. The witness denied that employees were under extreme pressure to complete this particular job and denied that he was supervising the job. He denied becoming aggressive and losing his temper when it came to his attention that there was a problem with silicones in the paint. In September 2009 a written warning was issued because the task was a relatively minor job which took almost three weeks and ran over budget. According to the witness the written warning was later retracted. The witness denied that the employee approached him to discuss the written warning and denied using the phrase “let sleeping dogs lie”.
In March 2010 a meeting was arranged which the witness denied had any preconditions. The purpose of the meeting was to resolve the issues included in correspondence from the employee’s solicitor. It was denied that a disproportionate pay cut was imposed on the employee.
The Tribunal were told of difficult trading times for the business with a significant drop in referrals from insurance companies. Although the company continues to trade there are now only four employees of which two work three days per week down from ten in 2009.
HR consultant (NG) gave evidence of his independent investigation into the bullying allegation made by the employee. He spoke with other employees as part of the investigation and prepared a detailed report which found no evidence the employee was bullied. He denied that one employee expressing a reluctance to give a statement and describing the work place as “a nightmare to work in”. He summed up the case as an employee with performance issues and a company trying to manage it and that he does not equate tension in the workplace as bullying.
At the hearing on the 17 April 2013 the Tribunal heard evidence from the employer’s accountant who outlined details of significant losses in the company. A summary of the financial statements of the company from 2007 to 2012 were opened in evidence.
For the employer (YM) and daughter of the owner outlined her role as office manager. She described having a good working relationship with the employee and added that he had not carried out any spray painting work while in employment. She recalled AM requesting she speak with the employee one evening. The conversation centred on how he felt he was no longer wanted by the employer and he suggested redundancy as an option. The witness denied AM was the one who mentioned redundancy. During the conversation she gave no commitment to an informal chat without notes being recorded. A meeting took place on the 9 March 2010 and ended abruptly when she began to take notes. He left the meeting saying he was assured of a man to man meeting. That day he left early with permission unable to work following the incident. Another daughter of the owner (DC) referred to a meeting she attended on the 24 August 2009 which concluded with the employee being issued with a written warning dated the 1 September 2009. She denied ever offering the employee a severance package. The outcome of a meeting held on the 14 May 2010 referred to by the witness as a procedural meeting concluded with the employee being put on paid suspension. On the 7 July 2010 the final report of an independent investigation became available. All the obligations on the employer were fulfilled and the investigation findings were that allegations of bullying and harassment unfounded.
A former employee of the appellant giving evidence on behalf of the respondent (employee) was employed from March 2006 to March 2011. He considered the employee MO’G as the go to person for advice on spray paint jobs. He was aware the employee was a key holder to the premises and regularly the first person to arrive and open. He did not accept the suggestion that the respondent had a poor record as regards punctuality. He recalled the Mercedes job in August 2009. The vehicle came to him prepared and ready for spray painting. His role was to prime and spray paint. The vehicle was returned to him the following day with obvious silicone defects. The task was repeated and following that the respondent assisted him with the polishing and flattening. He was fully aware that any problem with this task was down to him however he heard the employer shouting and swearing at the respondent. All of the anger was directed at the respondent. Following that incident he also received a written warning. He described the relationship between the employer and the respondent as very strained. The respondent began to be treated as an outsider. He was no longer the go to man for advice and his confidence had declined. The witness during his interview with the independent investigation officer described working there as “hell”. He agreed that the comment was made off the record only to the investigation officer. The witness added that it was well known the respondent’s experience and extensive background in painting and confirmed he had witnessed him carrying out some paint jobs.
A friend with experience in HR accompanied the respondent to the meeting on the 14 May 2010. He attended as a witness only and made no comments at the meeting. He described the meeting as tense from the outset. It was unclear what the purpose of the meeting was and it was never referred to as a disciplinary meeting.
The respondent gave evidence of commencing employment in February 2005 having previously run his own business. His experience included repair and bodywork involving stripping vehicles, straightening and spray painting. When he commenced employment the business was very busy and he had a generally good working relationship with the employer. Around the middle of 2009 he noticed the employer began to knit pick and comment on his work. Previously he would praise his work but now he complained that time was being wasted by having his work checked. The employer began to disagree and dispute the way he would choose to carry out a particular job. A number of incidents followed including one where he was accused of denting a vehicle while pulling into place. The incident where a fault appeared on a paint job which had to be redone led to him and a colleague being issued with a written warning. The respondent was asked to check a vehicle after it was redone and let him know when the customer could be contacted. He informed the employer that the vehicle was ready for collection but noticed soon after that there was still a problem with the paint job. The employer went into a rage on that occasion and the written warning followed soon after. This warning devastated him as he always took such pride in his work. When he spoke to the employer he was told to “let sleeping dogs lie”. He was never informed that the warning would expire after six months. The working relationship deteriorated further and the employer found fault with almost every job. AM (manager) suggested he should seek redundancy from the employer and indicated to him that the employer was “out to get him”.
The witness rejected the suggestion that he had sought redundancy. He was only concerned with protecting his good name. On the evening of the 2 March 2010 he agreed to speak with YM. He trusted YM and agreed to a man to man discussion with the employer as was suggested by AM. That meeting took place on the 9 March 2010 and he quickly realised the meeting was a formal meeting with a note taker in attendance. He left the room soon after and suggested a formal meeting could be arranged. He was shocked that the employer had opted to commence a formal meeting when it had been agreed that the meeting was an informal chat. The next meeting was arranged for 14 May 2010. At that meeting the employer opened the meeting stating that it was not a disciplinary meeting. The employer suggested that he was causing trouble on the floor and that this had to stop. A series of questions or allegations were put to him with no opportunity to explain or respond in full. A letter dated the 17 May 2010 was opened to the Tribunal. He was suspended on full pay for a period of one week which would be reviewed at that stage. A nine week period of suspension followed causing him much worry and anxiety.
During the investigation into his allegations of bullying by the employer which was conducted by NG he was reluctant to put forward the names of other employees as witnesses as he feared it was unfair to involve anyone who could later be punished. He received the final unsigned
report into the investigation on the 7 July 2010. The report including his own evidence to NG made no sense and he was given no opportunity to give any feedback on the findings. The matrix used in the redundancy selection was never explained to him and he believes it was flawed in respect of the scoring he received. He was scored zero points for painting which was unfair as he had experience in this area prior to commencing employment and assisted with paint jobs while employed with the company. A letter dated 23 July 2010 which was opened to the Tribunal notified him of his redundancy.
Determination
The Tribunal has carefully considered all the evidence and documentation submitted herein. It was clear from the evidence given by all parties that the appellant’s business was in dire straits at the time the respondent’s employment was terminated by the appellant, so in this regard the Tribunal is satisfied that a true redundancy situation existed. However, while redundancy is an absolute defence to a claim under Section 6(4) ( c ) of the Unfair Dismissals Act 1977, it is on the basis that the employee has been fairly selected. This is of crucial importance. This raises the question of what constitutes a “fair selection procedure”. In essence, what is required is that the employer be able to objectively justify why a particular employee was selected for redundancy as opposed to another employee. Specifically, the employer must be able to demonstrate that a particular employee has been compared to others who might have been made redundant and has been selected fairly on the basis of independent, objective and verifiable criteria.
Applying the above rules it was very clear from the evidence given by the appellant that the selection process under which the respondent was made redundant was flawed, with particular reference to the Matrix System employed to decide on the redundancy which was clearly ‘weighted’ against the respondent. The working relationship had broken down between the parties. There was a growing animosity which clearly manifested in their day-to-day workings which made conditions intolerable for both parties, but particularly the respondent, as he appears to have been selected for unmerited criticism. It is further clear from the evidence that attempts had been made by the appellant to get the respondent to seek voluntary redundancy and when this failed the appellant targeted him for statutory redundancy.
The appellant gave evidence that there were two redundancies that of the respondent and another person, but the evidence given at the hearing showed that the redundancy of the second person was not a true redundancy, in that this person was apprenticed to the appellant and he was leaving as his apprenticeship was at an end.
Conflicting evidence was given by both the respondent and the appellant but on balance the Tribunal finds the evidence of the respondent more credible.
In the circumstances, the Tribunal dismisses the appeal of the appellant and upholds the findings of the Rights Commissioner.
Sealed with the Seal of the
Employment Appeals Tribunal
This ________________________
(Sgd.) ________________________
(CHAIRMAN)