ADJUDICATION OFFICER DECISION

Adjudication Decision Reference: ADJ-00000438

Complaints and Dispute for Resolution:

Date of Adjudication Hearing: 18/02/2016

Workplace Relations Commission Adjudication Officer: Patsy Doyle

Procedure:

In accordance with Section 41(4) of the Workplace Relations Act, 2015 , Section 8(1B) of the Unfair Dismissals Act, 1977,Section 11 of the Minimum Notice and Terms of Employment Act, 1973, Section 27 of the Organisation of Working Time Act, 1977 and Section 13 of the Industrial Relations Act, 1946 following the referral of the complaints and the dispute to me by the Director General, I inquired into the complaints and the dispute and gave the parties an opportunity to be heard by me and to present to me any evidence relevant to the complaints and the dispute .

Respondent’s Submission and Presentation:

The respondent opened proceedings by raising a preliminary declaration that the Complainant was the Managing Director and 25% shareholder of the respondent company and therefore was not an employee. He was instead, self employed and prohibited from advancing the case under the Acts referred to in the complaint. The respondent stated that the complainant was paying PRSI at the same rate as a self employed person. Furthermore, the respondent disputed that a dismissal occurred as a Compromise Agreement had been finalised on May 8^th 2015 between the Company and the Complainant which concluded his association with the company. They sought that the Adjudicator dismiss the claims as frivolous or vexatious under S 42 of the Workplace Relations Act, 2015. They entered two written submissions for the record . One of which contained a financial statement of unaudited accounts from 30 April 2014. Two P 60s and a p45 ( proforma) were also entered which confirmed PRSI class S1.

Background:

Mr A, ( Operations Manager ) gave a background on the formation of the present printing company .In 2006 , the present company evolved from the amalgamation of other company interests .Four Directors and equal shareholders were incorporated into the current company . .The complainant was to take on the role of Managing Director, while Mr A was to take on the Operations Manager role dealing with design, pricing and invoicing. The company had two hands on Directors, Mr A and Mr L (the complainant) and two Directors, who had no involvement in the running of the business. The business developed more in the area of graphic design than printing.

The complainant was referred to as “Old school “and oversaw the financial aspect of the business. The business had a legacy of significant loans and debt and many of the components of the memo of understanding from 2006 failed to transpire. In particular, contracts of employment were never issued to the Managing Director, Mr L or to himself as planned. The complainant would help on the floor of the business if needed but mainly stayed in his office. There were 3 employees in the business, Mr A, Mr L and Mr C.

Problems began to emerge at the company in late 2014 where the company was stagnant, debts were raised and the complainant did not plan for a resolution to the difficulties. Instead, he took an extended holiday in Australia and on his return wrote a cheque for €1500 to a business colleague, which aggrieved Mr A. He took advice from the company accountant on how best to address the impasse, mindful of the significant company debts / lease obligations which the company directors had personally guaranteed.

Mr A decided that he would take over Mr Ls’ shareholding in the business   and formulated a severance package for the complainant on the advice of the company solicitor and accountant. He began to prepare the ground work for this. He submitted a copy of two texts between him and the complainant from early April which confirmed this. The latter text from the complainant confirmed that he was taking advice. On 27 April 2015, Mr A, Mr L and the Company Accountant, Mr B met in the accountants office and verbally agreed a severance package for the complainant. This consisted of:

1 €13,000 as an ex gratia termination payment to the complainant to be paid in three parts.

2 Indemnity for the complainant against all liabilities associated with the company.

3 The Complainant would resign as Director and transfer his shares to Mr A.

4 Existing customers would remain; Mr L was not obliged to use the company for his printing requirements. If he brought business to the company, it would be itemised on a” job by job basis”.

5 Office facilities were to be available to the complainant for business appointments.

On 29^th April, 2015, the complainant was handed a draft agreement which he signed on May 8^th 2015 at the company offices. This was witnessed by a company employee, Mr C; the payment of €13,000 was then forwarded to the complainant in three separate cheques. The monthly salary paid to the complainant was cancelled by Mr A directly with the bank. Mr L co signed this authorisation.

Shortly after this, the company received representations from the complainant’s solicitors which sought to unravel the agreement. The respondent was clear that the complainant wanted a speedy financial settlement to conclude his relationship with the business and that this had been honourably agreed and witnessed. The agreement had one postscript that clarification was needed from the complainant’s solicitor on point 6 on Indemnification. Mr A stated that he had concluded an extremely fair settlement with the complainant given that the shares were virtually worthless and the indemnification of the complainant against any liabilities against the company was generous.

On cross examination, Mr A accepted that the complainant was acquainted with one of the Directors on joining the company in 2006. He agreed that the complainant had brought considerable experience in the printing world to the business. He accepted that his role was office management at the company premises. Mr A confirmed that there were no termination documents outside the compromise agreement drawn up and the main objective was to present a settlement in the most “tax efficient “manner possible to the complainant in addition to covering the indemnities sought by the complainant .

The P45 issued in December 2015 had the date of May 7^th. All matters dealing with the complainants concerns on indemnification were contained in part 6 of the compromise agreement. Mr A understood that the finalisation of the agreement yielded the total conclusion of the complainants association with the company at every level, as a shareholder, managing director and general manager. He disputed that he was employed by the company and contended that he was self employed as evidenced by the payment of S1 PRSI.

Evidence of Company Accountant, Mr B,

He had been company accountant since 2008. There were 4 equal shareholders. Two working Directors and two inactive Directors .The PRSI classification for the complainant was S1, that of a self employed person and there was no employer PRSI paid .There had been an attempt made by the complainant to go under PRSI A (that of an employee) and all employees were listed on the p35 .Mr B confirmed that the complainant had two roles in the company, that of Director and employee but referred to it as Worker Director. Mr B understood that revenue had classified the S1 contribution for the complainant. He was a proprietary Director in possession of greater than 15% shares, therefore he was self employed and did not receive PAYE credits. Mr B pointed the hearing towards the Financial Statement for 2014 and the trading difficulties faced by the company, given the reduction in profit to 4% from 12 % in the year previous.

Mr B was involved in advising on the severance agreement and the objective was that of a “clean break” The Complainant has continued on as Director as the B10 document (approval to change directorship and the transfer of shares document) had not been signed by the complainant. The company is continuing to trade but has some debts.

Evidence of Mr C (employee)

Had worked for the company since 2005.He acknowledged that Mr A and Mr L ran the business. On September 11 the 2015, he recalled that Mr L called to the company to pay for a job. A delivery arrived at the same time and Mr L said he would handle it. Mr C told the delivery man to come back. Mr L tried to get access to the upstairs area and shouldered Mr C in the chest when his passage was obstructed by Mr C. He stayed for a time, rifling through the office upstairs and then he left. He denied that Mr Lynch had been bullied, but stated that he had never got on well with him. On cross examination, Mr C confirmed that he assumed that Mr L was an unapproved visitor to the company on that visit and he believed that the issue was that there special items in the packed boxes upstairs .

Summary: The Complainant was not an employee and all claims against the company are disputed. He was not under the control and direction of the company. Two P 60s from 2008 and 2014 were submitted in evidence which confirmed that S1 classification PRSI was conferred on both Mr A and Mr L and that MR C was the sole employee paying PRSI A class. All matters governing termination of association with the company were provided in the compromise agreement signed by both parties on May 8^th 2015. It was agreed that the complainants shares would transfer to Mr A and that he would resign as a director of the company. He has not officially transferred his shares or resigned his directorship, yet the cheques raised to conclude the compromise agreement were cashed.

The Complainant did not attend the company from May 8^th to September 11 the 2015. All assurances sought by the complainant on the protection of indemnity were assured by Mr A. Mr A is the company secretary. It was entirely correct that the wages and company credit card ceased concurrently with the completion of the termination agreement. The respondent was clear that the complainant gave an informed consent to the document of May 8^th 2015.

Complainants Submission and Presentation:

The Complainant had been invited to join the company in 2006. Previous to this, he ran his own printing company .He has been in a salaried position at the company from 20 April, 2006. He accepted the dual roles of Managing Director and general manager at the company. There were some business transactions outstanding at the time of his joining the company and he became a co Guarantor with the other Directors. He was to receive a contract of employment dated 24 March 2006, but this never followed. He brought his client base and goodwill to the company.

At that time, he was paid € 700 per week. In 2008, this figure became €400 nett per week following a Revenue review. This money was received by direct debit and this was cancelled on May 1^st by a document purported to be signed jointly by the complainant and Mr A. The Complainant denied that he co - signed this.

The Complainant had begun to plan for his retirement at the company and had not anticipated being approached to sell his 25% shareholding. His primary role was to get work into the printing company and he was skilled in this field.

The Complainant contends that he was summarily dismissed from his role of Managing Director of the company, that his wages were terminated and that he was placed under significant pressure to sign a severance agreement. He was then prohibited from entering his office and his personal effects were thrown onto the office floor. He was denied a letter of termination of employment, or a p45. There was no documentation on redundancy and his company credit card was curtailed without his permission. The Complainants case is that the agreement signed by him was under duress, was in draft form and signed without the benefit of legal advice. He cashed the 3 cheques given in return for his shares. He has been ill and has had to rely on illness benefit since May 2015.

The Complainants evidence:

The complainant was invited to join the company by one of the Company Directors Mr H. He accepted the role of Managing director and was paid a nett salary of €400 weekly .The Company returned all tax, PRSI and tax via the accounts manager and overseen by the company accountant. The revenue received by the business was logged in a ledger by either Mr A or Mr L and checked by accounts.

The complainant was approached by Mr A early in 2015 that he wanted to take over his shares in the company. He was asked to sell his shares to Mr A and if he refused, the company would be liquidated. The complainant accepted an offer of €13,000 in payment for his shares and resignation as Managing Director. He engaged with Mr A and the company accountant, but did not consider the document of May 8 a final document as he had insisted on clarification on the indemnification process from his solicitors, which was outstanding when he signed the document.

Both his wages and access to the company credit card were ceased in May 2015. The document he signed on May 8^th was not countersigned by the four Directors just Mr A and Mr L and witnessed by Mr C. He cashed the €13,000 payments but did not transfer his shares or his Directorship. He remains a company director to this day.

He arrived at the company on the third week of May, which was his first day back after May 8^th and stood at the end of the stairs and observed that his office was completely bare and Family photos were displaced.

He returned again in September to pick up a job, he paid Mr C for the job and said that he was pushed by Mr C who told him “You are like a bad smell; you are not wanted around here “He was blocked from going upstairs but persisted on going up.

He had never intended to resign from employment at the company and had not worked from May 2015 due to illness and was therefore, unable to mitigate his loss. His sole income was illness benefit from May 2015 to the date of hearing.

On cross examination,

The Complainant confirmed that all key financial decisions were made by him and Mr A on behalf of the company. He was the Managing Director of the company. All expenses incurred were detailed on statements .He went to Australia to visit his son in January 2015. He confirmed that he sent a text to Mr A on April 7^th 2015 that he was taking advice .His signature on May 8^th document definitely did not translate as him leaving the company as employment was not mentioned .. He did not recognise it as a contract. He did not sign the cessation of salary mandate with the bank. He agreed that he had entered discussions on 2 or 3 occasions with Mr A and Mr B but that this was never intended to incorporate him losing his job. He stated that he was very hurt and upset that he had been treated so badly by the company he had worked for. His health had suffered and he had had a” nervous breakdown” because of it.

Summary:

The Document signed by the Complainant on May 8^th 2015 was undated and in draft format. It was contingent on further clarification on indemnification, which never followed. Evidence of employee status is contained on the p35 where the complainant is listed as an employee. His signature was recorded on a termination of salary mandate on May 1^st 2015, but the complainant disputes that this is his signature. His company credit card was cancelled. His representatives wrote to the Company solicitor on 13^th May and July 1^st seeking modifications to the termination document as well as assurances on indemnity and tax, PRSI, USC commitments. His representatives sought a redundancy package for him on 18^th August 2015 and this was not addressed.

The Complainant is seeking compensation for his losses of position, payment in lieu of notice, annual leave and redress for the bullying and harassment suffered.

Preliminary Issue:

The preliminary issue for me, prior to any decision on the substantive claims is to establish whether the complainant was employed on a “Contract of service “or a “Contract for service “. There is a dearth in paper records in this case. While the minutes of the meeting held on 20 April 2006, go some way to capturing the intention of the parties on the complainants first arrival to the company, the vacuum in the follow up documents is stark. Therefore, there are four key documents on which the parties are relying.

1 The minutes of the Directors Meeting of CM Management ltd 20 April 2006 from which the complainant’s formal commencement at the company flowed.

2 P35, 2014 which listed three employees at the company. P60s for 2008 and 2014. Proforma P45, An extract from a document that refers to PRSI A classification for the complainant .

3 The Financial Statement of unaudited accounts for year ending April 2014

4 The Agreement signed on May 8^th 2015. The dual signatures recorded on a cessation of Salary Mandate .

The difficulty for me, at this stage is the obvious ambiguity in the roles held by the complainant from 2006. The SCOPE section of Department of Social Protection is the usual determinant of PRSI classification . Neither of the parties had referred the ambiquity of “contract of service” or “contract for service” to this service.

The respondent is clear that as a proprietary director, the complainant cannot simultaneously be an employee. The complainant is clear that he was an employee throughout the period as evidenced by the p35 and the dual and distinct roles of Managing Director and General Manager. Furthermore, when his income from the company ceased he availed of illness benefit from social welfare which would suggest, at least, a formal linkage through A1 PRSI classification. There was also one extract in the submission which linked the complainant to A1 PRSI but it was inconclusive.

Many Tribunals and Courts have deliberated on the challenge of establishing the identification of the distinction between contract of service and contract for service and I now need to follow this same path given the dichotomy in the evidence produced at this preliminary stage. Persons employed under a contract of service are protected by statutory provisions, while those employed under a contract for service do not enjoy the same protection. In so doing, I will give regard to case law in the area in addition to the Code of Practice for determining Employment or self employment status of Individuals, prepared by the Employment Status Group set up under Programme for Prosperity and Fairness and updated in 2007

.” In most cases, it will be clear whether an individual is employed or self employed. However, it may not always be so obvious, which in turn can lead to misconceptions in relation to the employment status of individuals ….. It is important that the job as a whole is looked at, including working conditions and the reality of the relationship. When considering the guidelines. An important consideration in this context will be whether the person performing the work does so “as a person in business on their own account .Is the person a free agent with an economic independence of the person engaging the service? This consideration can be a useful indicator of the person’s status and should be considered in conjunction with the other criteria listed in the code of practice.” (Extract from the Code of practice)

Application of the Law in the area

In Henry Denny and Sons v Minister for Social Welfare [1998] I I.R 34, The Supreme Court set down a leading example of application of the “Mixed Test “in Ireland. It originated with a social welfare claim brought by Demonstrator of Denny products. The Social Welfare Officers at deciding officer and on appeal in conjunction with consideration by the High Court and Supreme Court on appeal held, having examined the reality of the demonstrator’s relationship with the company that she had been engaged under a contract of service although her written agreement with the company stated that she was an independent contractor.

In Denny, Keane J held that “In some of the cases, different terminology is used and the distinction is stated as being between a ‘servant' and ‘independent contractor'. However, there is a consensus to be found in the authorities that each case must be considered in the light of its particular facts and of the general principles which the courts have developed ….”

“It is, accordingly, clear that, while each case must be determined in the light of its particular facts and circumstances, in general a person will be regarded as providing his or her services under a contract of service and not as an independent contractor where he or she is performing those services for another person and not for himself or herself. The degree of control exercised over how the work is to be performed, although a factor to be taken into account is not decisive. The inference that the person is engaged in business on his or her own account can be more readily drawn where he or she provides the necessary premises or equipment or some other form of investment, where he or she employs others to assist in the business and where the profit which he or she derives from the business is dependent on the efficiency with which it is conducted by him or her.”

These principles were reiterated by the Supreme Court in Castleisland Cattle Breeding Society Ltd. v. Minister for Social and Family Affairs [2004] 4 I.R. 150.

In the instant case, the complainant gave evidence that he took on the dual roles of Managing Director and General Manager of the company following a meeting on April 20^th 2006. These minutes, signed by the four current Directors of the company (plus one other director) indicated amongst other matters that:

• Also L Printing – business name will go over to CM trading as “L printing”. Mr L will bring his client base –no capital contribution- it will be his good will and expertise. Mr L will manage the office.
• General manager will be Mr L
• Mr L will be paid a weekly salary of €700 nett
• Contracts of employment will be signed by all shareholders dated 24 March 2006
• Mr L will join as co guarantor on leases and loans

The respondent disputes that this document was ever operationalised. I am slightly sceptical on that pronouncement, given the record of 29 Action points contained in the   minutes. This was a meeting in a solicitor’s office and reads more an Article of association than a typical set of minutes. For this reason, I prefer to give some weighting to it rather than none .In addition, it is the only evidence produced that refers to the intention of the parties on the creation of their combined working together. In the absence of the oral evidence of any of the other Directors, which of course would be preferable, I have taken account of the document in my consideration of this case.

The Financial Statement for the year 2013-2014 confirms the identity of four of the Directors, whose emoluments for the year were listed as €48,154. .In addition there is a sum in excess of €5,000 reported as paid in employer prism contributions which is in excess of what was attributed to the payment of Mr Cs PRSI   Employer contributions alone.

In O Coindealbhain v Moone 1990 I IR 422, Blayney J held that “ Where the agreement creating the relationship between the parties is expressed in writing , so it is the unique source of their relationship , it follows that is from its terms alone that the nature of the relationship can be determined “

I need to take a holistic view of all the facts and circumstances attributed to the job at the heart of the claim by both parties, given the polar opposite interpretations attached to date.

In assessing the criteria on whether the complainant may be an employee or not I have sought to apply the Code of practice guidelines,

• It seems to me that the complainant is a 25% shareholder and Managing Director of the business with a parallel role in Office Management. This is evidenced in the 2006 minutes and the Financial Statement dated April 2014, where Directors were paid both a salary as a company director in tandem with the salary paid to the complainant, Mr A for office Management and operational management respectively.
• He was paid a fixed weekly salary at a rate determined by the company. His car insurance was paid and he received paid holidays, but not paid sick leave. PRSI at S1 was recorded throughout his tenure with the exception of one extract where A1 was recorded but not picked up on the P45 when that issued in December 2015.

• The Complainant accepted the work on behalf of the company and had no power to sub contract. All major decisions were attributed to the collective engagement of the four Directors. He did not supply materials for the job as evidenced in the quotations sent to customers on the company note paper. He worked for one business only and received expenses. It was common case that he was the only director who had an office at the company.
• I note in the Financial Statement that the complainant was a company director of 4 companies. In carrying out the role of general manager and that is what I am being asked to decide on, he was not exposed to personal financial risks in carrying out the work, however, as Managing Director, who had given personal guarantees, he had some exposure to financial risks. There may be some parallel Company law considerations in this case, but these are not before me.  

In my deliberations, I am guided by the judgement of Justice Laffoy in Neenan Travel v Minister for Social and Family Affairs [2011] IEHC 458.

This was an appeal of a determination by Social Welfare that a Minority shareholder at 16.5% stake in the company , who started as an employee paying A1 stamp to transitioning to a Director paying S1 stamp was recognised as having a contract of service . The matter came to light when the company made an exgratia severance arrangement and sought to recoup the rebate to employers in respect of statutory redundancy payment . This does not arise in this case given the abolition of the rebate; however, there are a number of similarities.

In dismissing the appellant's appeal, Laffoy J. acknowledged that it had not been necessary, nor did she attempt to “identify any general principle which would be of assistance in identifying the point at which … a substantial shareholding and the top management role in a company may be indicative of the fact that the person in that position is acting on his own account and not as an employee of the company”. In this regard, Laffoy J. noted that “each case must be considered on its own facts in accordance with the general principle which the courts have developed, as Keane J. stated in the Henry Denny case”.

• I find that the complainant acted for the company and not on his own account , he was a minority shareholder Fleming v Secretary of State for Trade and Industry [1997] IRLR, distinguished , He could not make any major policy decision or business decision without prior consultation with the other three shareholders as evidenced on the 2014 Financial Statement . While the complainant did have considerable autonomy and responsibility for the proper discharge of the company business , he was subject to the overall control of the other shareholders . This maxim is crystallised in the manner in which he departed the company. I prefer the findings in Neenan in this regard and in particular the reliance on :

“ I think it is appropriate to recall the most fundamental principle of company law, which was laid down over a century ago in Salomon v. Salomon & Co. Ltd. [1897] AC 22: a registered company constitutes a legal person with a legal identity separate and distinct from its individual members or shareholders” Laffoy J.

It is my view, based on the evidence of both parties that the complainant worked for the legal entity of the company rather than himself.

Therefore, having considered the position described by the complainant and responded to by the company , I find, having regard for the unique circumstances of this case , that, on balance the complainant in this case has satisfied the test for possession of a “contract of service” and has locus standi to take his complaints forward .

Decision:

Section 41(4) of the Workplace Relations Act 2015 requires that I make a decision in relation to the complaints and dispute in accordance with the relevant redress provisions under Schedule 6 of that Act.

1 Section 8(1B) of the Unfair Dismissals Act, 1977 requires that I make a decision in relation to the Unfair Dismissal claim consisting of a grant of redress in accordance with section 7 of the 1977 Act.

Section 1 of the Unfair Dismissals Act 1977 defines a Dismissal” as termination by his employer of the employee’s contract of employment where prior notice of termination was or was not given to the employee”.

I have considered all the oral and written submissions submitted by the parties. Both parties are aggrieved at the turn of events and the case is striking due to the “unfinished business” aspects. On one hand, a termination payment has been paid to the complainant on the assumption of a “clean break “via a compromise agreement. On the other hand, there remains a significant ambiguity on the parameters of this compromise agreement which has brought the parties to this juncture. It is essential that I consider the claims carefully having regard for all the facts and circumstances described by both parties. I wish to make a number of primary observations:

1 It is clear that there were a series of anticipatory actions by both parties where departure/ termination/severance was discussed from February 2015 up to and including May 8^th, the date where the compromise agreement was signed by Mr A and Mr L . It is reasonable for me to conclude that the consequences of these actions was a plan to manage the complainant out of the business via a legal framework and that course of action was acceded to by both Mr L and Mr A . There are of course parallel considerations under Company Law, but these are not before this hearing.

2 Given the statements contained in the company financial statement surrounding the need for collective action of four Directors on serious business matters, it has struck me as unusual that Mr A did not have both Directors visibly onside throughout these serious matters. On the other hand, I appreciate that it was open to the Complainant to affect that outcome if he wished. He does not appear to have done this.

3 The Complainant told the hearing that he signed the compromise agreement under pressure and as a last resort in the face of a threatened Liquidation of the company. I have a difficulty in accepting this statement given the long lead in period from February 2015 to May 8^th. Both parties had access to separate legal advice, albeit at arms length, However, the proceedings stopped short of having” both sides cards face up on the table”.

Instead both parties proceeded to move towards their anticipated outcome albeit at different speeds .On the respondent side, there was a strong purposeful approach of take-over, whilst the complainant initially adopted a laissez faire approach until the reality of May 8^th dawned. I note in the complainant’s subsequent correspondence with the company that he anticipated being paid up to the beginning of May 2015. In addition, I note section 3 of the compromise agreement

“On signing hereof, L shall resign as director of the company and hereby acknowledges that he has no claim against the company whether for compensation, for loss of office, loss of employment or otherwise “

If I take the ordinary every day interpretation of this statement, it would seem that acquiescence to this clause alone would have resulted in a termination of the Managing Director position.

4 Two points cause me some unease at this point

1 The cessation of the standing order for the complainant’s salary on May 1^st 2015. I note that the complainant consistently throughout the hearing disputed that he signed this document. The respondent was unable to place collateral detail around the context and back ground to the signature. This was in contrast to the clarity and consistency applied by them to recall of the preparation and agreement to the termination document. Finally, I note that Mr A placed his mobile phone number under his signature, whilst this part was missing under the complainant’s name. I find this to be inconsistent.

2 The standard of the Compromise agreement format. Given that all Directors, Legal Advisors and Business Advisors were highly experienced business people. I am struck by the casual approach to the completion of the document on May 8^th 2015, given the considerable body of case law in existence in this field .Hurley v Royal yacht Club[1997]ELR225,Sunday Newspapers Ltd v Kinsella and Brady [2008]ELR 53 , Hinton v University of East London [2005]ICR 1260.

I propose to examine the status of the compromise agreement with direct relevance to the claim for Unfair Dismissal.

Compromise Agreement

The Compromise Agreement was provided to the complainant by the respondent on May 8^th

• Undated
• Part signed by 1:4 Directors
• Large gaps in detail were obvious i.e. section 1,2,7.3
• Section 6 was qualified by clarification being sought from the complainants legal advisor
• There was no reference to “ full and final settlement ”
• There was no reference to providing an opportunity for legal advice
• There was no reference to cessation of wages or curtailed access to the company credit card.

This could not be seen by a reasonable person as a viable document to conclude a 9 year employment history. I find that on the day of acceptance of the offer, the complainant did not have access to adequate legal advice as evidenced by point 6 being declared outstanding. I find that the complainant was not in position to conclude the agreement on informed consent. Therefore, the document must as in Hurley be found to be void.

I appreciate that the respondent did not see the complainant having rights outside those of a Director with shares to sell; the words of Buckley J describe the scenario well in Hurley:

“{My decision} should not be taken as an indication that the officers of the Club behaved improperly or that they unfairly pressurised the applicant. I am satisfied they genuinely believed it was in the best interest of the club, once a decision to dismiss was taken to ensure a speedy agreed settlement”

Section 13 of the Unfair Dismissals Act 1977 states:

A provision in an agreement shall be void in so far as it purports to exclude or limit the application of, or is inconsistent with any provision of this Act.

The Complainant was entitled to the benefit of legal advice and I find that the process, while informed by legal advice during April 2015, concluded with clarifications unanswered which tainted the legality of the entire process on May 8^th 2015.

UNFAIR DISMISSAL

It follows that I must remark on the procedures relied on by the respondent in this case. The complainant left the company, bar two return visits on May 8^th. He remains a Company Director. From my enquiries, I was unable to ascertain what ceremony, if any accompanied his departure. There was no formal handover , no “ leaving do “ or ritual associated with standard departures outside the handshake and the signed agreement . It is common case that the complainant understood that his termination was imminent, where the disagreement lay and continues to lie is in the “clean break” maxim contended by the respondent. I appreciate that the transfer of the shares was the ultimate objective in this case, but the corporate personality of the business should not have eclipsed the individual in this case. I accept that that the complainant had a very difficult year following the manner in which his departure was executed.

There was a lack of fair or any procedures surrounding dismissal in this case.

Section 6(7) of the Unfair Dismissals act 1977 as substituted by S 5(b) of the Unfair Dismissals (Amendment Act) 1993;

Without prejudice to the generality of sub section (1) of this section ,In determining if a dismissal is an unfair dismissal, regard may be had ,if the rights commissioner ….as the case may be, considers it appropriate to do so :

(a)    To the reasonableness or otherwise of the conduct ( whether by act or omission) of the employer in relation to the dismissal “

I appreciate that the respondent did not believe that the obligations of an employer in the face of a dismissal were necessary in this case. The incompletion of the compromise document coupled with the unilateral cessation of salary and access to the company credit card were not underpinned by adequate procedures.

I find that the respondent acted unfairly and unreasonably in this regard towards the complainant and that renders the dismissal unfair .However, I find that the complainant contributed significantly to his dismissal by failing to take a pro active approach in the preparation for change in his working life of the described seismic proportions.

Redress:

While I have found that that the complainant was unfairly dismissed, I do not find the option of re-instatement to be viable at this point given the clear break down in relations between the parties. I am conscious that there are major company law issues outstanding in this case that may have been better served by re-instatement i.e. completion of the share transfers.

As I found that the compromise agreement was void, there is an onus on the complainant to return the€ 13,000 he received in payments.

I heard from the complainant that he was unable to mitigate his loss due to illness from May 2015 to the date of Hearing, February 18, 2016.In addition; he stated that he received illness benefit of €188.00 throughout that period.

I recognise that the complainant has a prospective loss, given his age, illness and foreseeable difficulty in securing re-employment. I award the sum of € 25,800 in compensation, approximately 8 months salary for the Unfair Dismissal, which is reduced to €12,800, having regard for a reimbursement of the €13,000.

Section 11 of the Minimum Notice and Terms of Employment Act 1973-2005 requires that I make a decision in relation to the complaint in accordance with the relevant redress provisions under section 12 of that Act.

I award the complainant four weeks pay in lieu of notice. €1,600.

Section 27 of the Organisation of Working Time Act 1997 requires that I make a decision in relation to the complaint in accordance with the relevant provisions under Section 19 of the Act .

The Complainant gave evidence that he had taken holidays to visit his son for a month during January 2015. This was uncontested. There is no residual entitlement to annual leave. The complaint is not well founded.

Section 13, Industrial Relations act 1946 requires that I make a recommendation in relation to the dispute in accordance with the provisions of the Act.

I have considered the complaint submitted under this Act and I find that there are a number of over laps on the substantive claim for unfair dismissal, which I believe I have already addressed.

The complainant contends that he was bullied and harassed and excluded from the company building and in particular his office. He told the Tribunal of the distress he felt when he returned to find his belongings boxed away and strewn around the office. The respondent denies this and was clear that there was no intention in upsetting the complainant in this regard. The office had not been used since May 2015 and the respondent saw no difficulty in the complainant collecting his belongings.

The respondent did not have a Dignity at work policy. The complainant did not advance a complaint internally in the company. I find that I have addressed the core of this complaint in the earlier claim.

I would however recommend that within three weeks following the release of this decision that both representatives for the parties agree a day and time whereby MR Ls belongings can be returned to him in a dignified fashion to assist with the closure of this difficult experience.

Patsy Doyle   Adjudication Officer

Dated:   7 April 2016