ADJUDICATION OFFICER DECISION
Adjudication Decision Reference: ADJ-00002051
Complaints for Resolution:
Act | Complaint Reference No. | Date of Receipt |
Complaint seeking adjudication by the Workplace Relations Commission under Section 8 of the Unfair Dismissals Act, 1977 | CA-00002791-001 | 22/02/2016 |
Complaint seeking adjudication by the Workplace Relations Commission under section 7 of the Terms of Employment (Information) Act, 1994 | CA-00002791-002 | 22/02/2016 |
Date of Adjudication Hearing: 10/08/2016
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, and Section 7 of the Terms of Employment (Information )Act, 1994. Following the referral of the complaints to me by the Director General, I inquired into the complaints and gave the parties an opportunity to be heard by me and to present to me any evidence relevant to the complaints.
Respondent’s Submission and Presentation:
The respondent disputed the claims under the Unfair Dismissals Act 1977-2007 and the Terms of Employment( Information) Act, 1994. The respondent described running a small family run business with three to four employees .The complainant commenced employment at the respondent travel agency on a part time, 3 day week basis on 17 September, 2014.
The respondent maintained a commercial database referred to as “Travel Manager” where the monthly record of sales was logged. There was open access by all staff to this database.
In December, 2014, the owner, Mr O spoke to the complainant regarding her sales figures not meeting the cost of her salary and that she would be expected to improve this in the New Year.
As the matter of the complainant’s sales was being discussed, the matter of extending her contract was deferred pending an improvement. The respondent did not notice an improvement .The complainant then made a serious error in a booking which cost the company in excess of €1,700. The company considered her dismissal at this point but did not act on this as it was agreed that the complainant would make an effort to increase her sales to offset this loss. The complainant had never achieved sales to cover the basic cost of her wages and the company was losing money.
The respondent made some internal business changes, by closing a sister travel shop and advertising for a Full time travel consultant position. The complainant did not apply.
Sales improved on the appointment of the new full time travel consultant .The Financial Director, Mr FC spoke to the complainant directly on two occasions as he was very concerned at the outcome of her sales .During the business consolidation process, the respondent decide to issue the complainant with her notice and terminate her employment. When the complainant was informed of this, she left the business forthwith, without serving her notice.
The respondent sought an understanding that the omission to issue a statement on terms of employment was mitigated by the period of uncertainty in the complainants performance .The Company had no issue with the complainant, however, there was a clear problem with her lack of sales and the respondent did its best as a small company to seek an improvement in her performance. There were two serious review meetings .They contended that the complainants frequent reviews of the data base would have confirmed her shortfall and she must have been aware of the gravity of the situation .
Evidence of Mr O, owner.
Mr O hires the complainant via an informal interview. Her name had been given to him as someone with significant travel industry experience and he extended her offer of salary commensurate with that experience. It soon became clear to him that the complainant was not making her wages or covering the cost of heat and light .He spoke to her at Christmas an sought an improvement in view of the run up to the end of the financial year . She never came up to the stage of covering wages.
The company accountant attended the business one day a week .He met the complainant on two occasions, seeking improvements. On one occasion, the complainant said that she had been on annual leave. The accountant spoke to the owner and advised him to “do something “to address the shortfall in sales from the complainant .Mr O expressed a reservation as the direct approach was not the way the company operated. He had every intention of presenting a contract to the complainant if “things were right”.
Mr O submitted that September 2014 was a lean month for the complainant, where she had one sale .This did not cover her wages. In early 2015, a serious error occurred in relation to deposits on flights, this was a transaction that had been discontinued .. The error attributed to the complainant amounted to €1, 700, which was absorbed by the company. Profits were low in July, 2015.
Mr O took issue with the complainant’s contention that she had not been told about problems, as both he and the accountant had raised it with her. He confirmed that these reviews were verbal and not in writing .Finally, sales were continuing weak and the accountant advised to act on this information. Mr FC, the accountant made the decision, in light of the economic downturn in sales at the company that the complainants termination of employment was warranted.
During cross examination,
Mr O disputed that the complainant could possibly have been unaware that there was a problem with her sales .It was clear that the job was based on what you sell. He confirmed that the company had not written to the complainant in this regard, but she had been addressed on the topic. He had not received Curriculum Vitae for the complainant during the hiring process.
Mr O submitted that the complainant had made unsavoury comments towards his wife immediately following her dismissal and she did not work her notice.
Mr O accepted that the complainant worked Monday –Wednesday. Counsel for the respondent submitted that most people were paid on either Thursday/Friday and this may have gone some way top explain a lower income generation during her working time ,if people were actually paying for holidays when they were paid .
Mr O confirmed that the complainant had not been headhunted and was instead a locum cover for an employee on maternity leave .It was hoped that they would gel together on her return. He confirmed that he had held back on issuing a contract to the complainant in light of her sales performance issue.
The error involving the “deposits on flights” cost the company money and Mr O had addressed the complainant directly after this. He submitted that if the complainant had held a contract at that point that he would have considered dismissal. He did consider a Disciplinary procedure but did not want to go down that route .He offered to submit the comparator income generation figures, September –December 2015 of the other travel consultants to add certainty to his case.
One of the travel consultants, Ms A left to become a chef in August 2015. Another employee was going on maternity leave and a full time vacancy was advertised. Mr was incredulous that the complainant allegedly did not know of the vacancy.
The overall sales for the company were good in November but much lower than expectation.
Evidence of Mr TM, Manager
Mr TM recalled the company being impressed when the complainant was hired to join the team .Great things were expected of her input but this did not evolve .Mr TM recalled that the complainant was given a few “chances” as she appeared under pressure. He confirmed that targets and performance reviews were discussed but not written down. Eventually, the complainant was given the softer work to do, such as a definite family holiday itinerary.
He managed the corrective action on the “flights deposit “issue. He was given the file 24 hrs later .He rectified the situation within 48 hrs by developing a loss for the company of €1,700. He tried to give as much assistance as possible, but the matter was very serious for the company.
Complainant’s Submission and Presentation:
The complainant contended that there were no substantial grounds in the case to justify a dismissal. The complainant had got on well in the office. A text message was read into the record on an August 2015 exchange between the complainant and MrO's wife, who also worked in the business. The message stated that business was busy over a two day period.
Counsel for the complainant submitted that there was a complete absence of documents in the case. There was no contract of employment, any written policies or staff handbook. Therefore, the complainant was not aware of any internals appeals mechanism.
The complainant disputed an overall sales downturn as this would have been reflected in a redundancy process, but this did not occur. The complainant was unaware during the course of her employment that her performance fell short of the mark. The complainant submitted that there were recognised procedures to be followed in the event of problems in work performance. There was no documentation available on performance review or that the complainant was bound to cover her wages in income generation.
The complainant was effectively replaced by a full time member of staff three weeks before she was dismissed. She was not afforded the opportunity to compete for this position.
The complainant was denied fair procedures. She was denied representation .The complainant has now developed an anxiety condition with a temporal link to the events of November 2015. She is on medication and is unable to work .She gave evidence of loss. The complainant cited the authority of Liz Allen v Independent Newspapers ltd [2002] 13 ELR 84 and sought application to the instant case.
Complainant’s evidence
The complainant recalled being approached by a colleague of the respondent, where she learned that there was a 3 day working week available at the respondent travel agency. She had 30 years of experience in the field. She had been on a temporary contract in another travel agency but left to commence with the respondent business .She attended an informal interview and was not requested to submit a C.V. She was asked what salary she was on but she had no recall of any mention of targets or sales during the interview .She were not furnished with a contract .She commenced work 17 September, 2014.
The complainant recalled Mr O addressing her on sales in December, 2014. This was on an informal footing .There was an issue in March 2015, the complainant understood that her actions had caused a loss for the company and she handed the file to Mr TM, she followed it up on three occasions but she was shut down. She understood the loss to be €200.00 she raised it with Mr O also as she understood that there would be consequences .She was told not to mention it again.
The complainant submitted that she was not aware of a sales downturn at the company and she had no knowledge that she was expected to cover her wages .She enjoyed her time at the company .She took a lot of queries on Mondays and deposits were lodged following these queries .
She was not aware of the advertisement for the vacancy as she would have applied for the full time position.
The complainant had a brief encounter with Mr FC in October where he questioned her sales figures but did not make an issue of it. On 4 November, around 3 pm, she was approached by Mr FC who pointe at her and state that he wanted her to come to see him across the road in a sister office .She obtained the key for the building and went up the stairs to meet him .Mr TM stated that “I am letting you go “and handed her a letter .The complainant asked whether the others were aware of this and she submitted that Mr FC stated:
“I am the Chairman I can do whatever I want “.The complainant was shocked as she had no appreciation that her job was at risk .She rea the letter and responded by stating “bad luck to ye” .She became ill and was unable to work her notice .She developed anxiety for the first time in her life in the aftermath of her experience with the respondent. She recalled that Mr FC did not address her by name.
During cross examination, the complainant confirmed that she had not experienced problems from her commencement until November 2015.She acknowledged that the Travel Management system was difficult to get used to and some of her sales had not been registered on it properly .In response to a question from the respondent representative, the complainant confirmed that “ It was taken as a given that I would hit targets “.She acknowledged that she went into the system and kept an eye on targets .She was more conscious of doing the job properly .
She denied that there had been a 1:1 meeting in June 2015 to address her performance. She acknowledged the meeting in October 2015 regarding the August sales figures but she submitted that her sales were fine up to then. She acknowledged that she never thought of asking for a contract as she believed that she had a permanent job.
In response to questions from the Adjudicator, the complainant acknowledged that there were some staff meetings where all staff attended around January and August 2015. The downturn in sales was not discussed at these fora.
Decision:
Section 41(4) of the Workplace Relations Act 2015 requires that I make a decision in relation to the complaints in accordance with the relevant redress provisions under Schedule 6 of that Act.
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 7 of the Terms of Employment Act, 1994, requires me to make a decision in relation to the claim under Section 3 of the Act.
I have considered the evidence of both parties and the submissions which accompanied the case. Shortly after the hearing in this case, I received a spreadsheet on the income generated by the Travel team during November 2014 and September 2015. In addition, I received a cumulative total of income generated over the 14 months of the complainant’s employment. The respondent copied these documents to the complainant but no further submissions followed.
I find that the events which unfolded suffered from the lack of provision of a contract of employment from the outset. I appreciate that it was a small business in a small town; however, the scale of the enterprise does not permit an exemption from statutory responsibilities. As the obligation rests squarely on the respondent under section 3 of the Act.
3-(1)” An employer shall not later than two months after the commencement of an employees employment with the employer give or cause to be given to the employee a statement in writing containing the following particulars of the terms of the employee’s employment “
I find that this omission goes to the root of the case. The complainant understood that she had a permanent job. The respondent understood that he had hired someone who understood that her wages needed to be covered by her personal income generation. The lack of a foundation document to encapsulate the real status of terms would have gone a long way to manage these different views expectations.
I have analysed the sales figures pro offered and I find that there was a clear seasonal variation in the figures as could reasonably be expected in the travel business. There are also other factors such as the longevity of other travel consultants and the complainant’s part time status to take into account. However, I note that there was a sizeable increase in income generated by the business overall in between the calendar year of September 2014 –October 2015 to the tune of approximately €77,000. It is apparent from the spreadsheet that the complainant’s sales totals fluctuated. However, they were at their lowest in November, 2014 and their highest in June 2015.
While I am not an accountant, the figures as presented do not present as cogent evidence of a company in financial difficulty. I must therefore evaluate the letter of dismissal in this case.
“ I regret to inform you due to the downturn in our business we are unable to sustain your part time employment with X as three full time staff will now satisfy our needs at present “
This letter is not supported by the facts of the case.
The respondent confirmed that the company identified a deficit in the complainant’s sales from early on. They understood that they had placed the complainant on notice of this. There is conflict between the parties on this nett issue. Given the lack of documentation on performance review, coupled with the lack of discussion on problem sales at the staff meetings, I must resolve this conflict in favour of the complainant. I am mindful that the Travel Manager system was open to the complainant to self assess her sales at any time and I accept the evidence of the respondent in this regard , what was missing was a nominated manager who led out on this process.
I find that while the respondent did hold discussions with the complainant on a number of occasions on her sales, the message was not heard. I offer this view as the complainant is highly credible in her account of the conversations that occurred. I am satisfied that she was not invited or even directed into a corrective action plan to address the deficits as identified by the respondent , therefore she could not avail of the opportunity to understand the gap between what was happening and what was required .
I gave some consideration to the evidence of Mr O who was uncomfortable on the topic of having recourse to a disciplinary procedure. I appreciate that as an experienced manager, he wished to maintain cordial staff relations and viewed the disciplinary procedure as something he didn’t want to have to rely on, however, and I find that the complainant had a right to be informed of shortfalls so as she could be permitted to improve .She was denied this opportunity.
Unfair dismissal is described in Section 6 (1) of the Act.
6
- —(1) Subject to the provisions of this section, the dismissal of an employee shall be deemed, for the purposes of this Act, to be an unfair dismissal unless, having regard to all the circumstances, there were substantial grounds justifying the dismissal.
6(4) without prejudice to the generality of subsection (1) of this section, the dismissal of an employee shall be deemed, for the purposes of this Act, not to be an unfair dismissal, if it results wholly or mainly from one or more of the following:
(a) The capability, competence or qualifications of the employee for performing work of the kind which he was employed by the employer to do,
(b) The conduct of the employee,
(c) The redundancy of the employee, and
………
The Statutory Instrument 146/2000 outlines general principles on conducting both grievance and disciplinary procedures.
It states that the procedures should be rational and fair ,that the range of penalties that can be imposed are well defined and that an internal appeal mechanism is available .It specifically states that “ Good practice entails a number of stages in a disciplinary procedure “These steps should generally be progressive . The respondent did not have a grievance or disciplinary procedure which they opened to the hearing. Instead, the details of the dismissal were described as a business imperative and were justified as such.
I have considered both parties evidence on what occurred on the afternoon of 4 November, I accept that the respondent, Mr O was overtaken by the zeal of Mr FC to resolve the problem the company was experiencing in sales. However, it is imperative that any decision maker on a dismissal process adopts a reasoned and collaborative approach .A person’s job is their livelihood and needs to be viewed in that light by all charged with governance or strategic management of staff ..
I accept the evidence of the complainant that she was faced with an unannounced and unanticipated invitation to leave her workplace and attend an office across the road to meet a Manager she hardly knew. I was struck in the hearing by the complainant’s description of having to obtain the key to the building herself and travel up the stairs to learn of her dismissal. I was particularly struck by the reportage that her name was not used throughout the exchange. Mr FC did not attend the hearing. I accept the evidence of the complainant when she stated that there was no pre-amble, just a notification of her termination of employment on one weeks notice.
I find that the respondent showed a complete lack of empathy for the complainant in the immediate wake of her dismissal. She contacted Mr O, only to be told that there was nothing he could do. She described on her complaint form that she had been photographed with the team earlier in the week for business promotion purposes. When the photo was published the day after the dismissal, she was not included on it .The complainant commenced illness benefit on anxiety grounds on 2 December 2015.She stated that she has been unable to seek work.
In Dunnachie V Kingston upon Hull City Council [2004]IRLR 727, the UK House of Lords rejected an earlier finding that compensation was properly permissible in a case of injury to self respect . I find that the complainant suffered significant personal trauma as a direct result of her dismissal .I make this finding based on her evidence and her demeanour at the hearing. I accept her evidence that she has been on illness benefit from 2 December 2015.
There was no justifiable cause for the dismissal nor was there any utilisation of proper procedures or provision for a fair hearing . Kilsaran Concrete ltd v Vitalie Vet UDD1611 ( Labour Court ) Therefore, I must find that the dismissal was unfair on all grounds.
I have given some consideration to options for redress and I find the options of re-instatement and re-engagement to be wholly impracticable. Instead, I have considered all the circumstances of the case and I find that compensation is the most just and equitable remedy .I is mindful of Section 7(2) of the Acts
(a)“ the extent , if any , to which the financial loss referred to in that subsection was attributable to an act , omission or conduct by or on behalf of the employer
And
(d) the extent ( if any ) of the compliance or failure to comply by the employer or employee with any procedure of the kind referred to in section 14(3) of this Act or with the provisions of any code of practice relating to procedures regarding dismissal approve by the Minister .”
CA-00002791-001 (Claim under Unfair Dismissals Act 1977-2007)
While I see some overlaps in the Allen case on constructive dismissal , I am guided by the 14 month tenure in this case .I have identified omissions on behalf of the respondent already both in terms of conduct and lack of reliance on a procedural framework in the case . I cannot attribute such an omission or act to the complainant. I note that she is at present unable to work; therefore I award €17,992.00 as an estimated prospective loss attributable to the dismissal in compensation. I judge this as appropriate to cover a period in time until she might reasonably be expected to find another job, Devine V Designer flowers , Whole sale Florist Sundries ltd [1993]IRLR 517 , an English UK EAT determination applies .
CA-0000279-02 (Claim under Terms of Employment (Information) Act, 1994.
I find that the respondent breached section 3(1) of the Act through non compliance with the mandatory terms. Therefore, I find the complaint to be well founded and award the sum of €1,038.00 in compensation.
Dated: 13th October 2016