ADJUDICATION OFFICER DECISION

Adjudication Decision Reference: ADJ-00004482

Complaints for Resolution:

Date of Adjudication Hearing: 25/11/2016

Workplace Relations Commission Adjudication Officer: Louise Boyle

Procedure:

In accordance with Section 8(1B) of the Unfair Dismissals Act, 1977, and Section 39 of the Redundancy Payments Act 1967, 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 is part of a larger group, Irish owned that produces small to medium sized electricity generating wind turbines. In 2014 the respondent experienced severe financial difficulty with significant losses which continued in 2015. A pay freeze had been put in place as well as negotiated reduction with suppliers and sourced alternative suppliers. Where possible alternative work was offered to some employees at the sister company but in 2016 the company continued to experience financial difficulties with no production orders for new turbines and no knowledge of when new orders would come in. As a result urgent restructuring was required and a total of 47 redundancies were required at the facility where the complainant worked, across all areas.

The complainant commenced employment as a Computer Programmer on 24^th October 2013 and his employment ceased owing to redundancy on 18^th March 2016, inclusive of his notice period. The complainant’s main responsibilities covered two main areas - one was in relation to a specific controller, used by the turbines, referred to as Controller X and his second main responsibility was the development and maintenance of the respondent’s web site which he and another employee Mr A performed. The turbines also used another type of Controller referred to as Controller Y but this work was performed by Mr A. The respondent stated that the complainant took his instruction from Mr B, an IT consultant engaged by the respondent. In January 2015 much of the duties regarding Controller X ceased and what did remain were subsumed by Mr B.

In May 2015, the complainant requested that he be moved to a 3 day week (24 hour week) as there was not enough work to require a 5 days week. This was implemented effective 22^nd March 2015 with the complainant maintained on his weekly salary of €770.00 per week. On 12 January 2015, the complaint was returned to a 5 day week which was to be for a temporary period of only 3 weeks.

On 2^nd February 2015 the complainant took unpaid leave for a period of time owing to his child becoming very unwell with a burst appendix. While absent from work, he offered to resign his position but subsequently returned to work on 2^nd March 2016. However, during his time off a decision was made to make 47 positions redundant including the complainant’s role and during his absence from work the company determined that the development of its web site was a luxury that it could not afford and ceased the development of the website. This in effect meant that the secondary function of the complainant’s duties had become redundant. The complainant was advised on 4^th March 2016 that his role was redundant with a finish date of 18^th March 2016 and he did not work his notice.

The respondent stated that the complainant did not appear surprised or angry at the decision and stated that he was well aware of the financial position of the company. A further meeting took place between the respondent and the complainant on 5 May 2016 at the complainant’s request to answer a number of questions raised by the complainant. The respondent disputed the complainant’s minutes of that meeting and provided their own minutes. A grievance meeting was held on 27^th May 2016 and a decision affirming the complainant’s redundancy was given on 14 June 2016. On 19^th July 2015 the respondent was contacted by the complainant’s solicitor requesting further information which was replied to on 22^nd July 2016.

With regards to the complaint under the Unfair Dismissals Act 1977 (CA-00006238-001), the respondent outlined that the complainant’s dismissal resulted from the fact that his position was redundant as a result of the downturn in the respondent’s business and there was no longer a requirement for the majority of the work the complainant had specifically been employed to do. There was no alternative work available for the complainant and with regards to lack of consultation, the respondent referenced British United Shoe Machinery Co Ltd v TJL Clarke (1977) IRLR297 whereby lack of consultation would not necessarily make the dismissal unfair.

With regards to the complaint under the Redundancy Payments Act 1967 (CA-00006238-002), the respondent disputed the start date on the complainant’s claim form which the complainant had stated was 24^th March 2013 and the respondent stated that the actual start date was 24^th October 2013 as stated in his contract of employment. The respondent also outlined that the complainant received and accepted his redundancy entitlement without objection and was never specific at his grievance meeting regarding his complainants around the selection criteria for redundancy. The respondent does not accept that Mr A should have been made redundant instead of the complainant as Mr A has a degree in electronic engineering which the complainant does not and this specific type of degree was needed with regards to the future IT needs of the organisation.   It was also suggested by the respondent that the complainant’s qualifications were acquired from an “on line” course/third level institution and were thus less suitable. The respondent also did not accept that the complainant was working 40 hours per week at the time of his redundancy or that he was in receipt of net pay of €849.57 per week as this was only a temporary arrangement for 3 weeks and that his normal gross pay was 770.00 weekly.

Complainant’s Submission and Presentation:

The complainant accepted that there was an error with his start date on his complaint form and that the correct start date was indeed 24^th October 2013. He claimed that he had no line manager since May 2015 and that he took instruction from a number of sources within the company including the CEO but that he largely worked independently. In April 2015, the complaint felt that his workload was too much for one person and when he advised that he was resigning, he was offered, by the CEO, a reduced working week of 3 days a week on the same pay that he had been on for 5 day. The complainant choose to stay with the company.

In June 2015 he was given responsibly for the development of the company’s new website. With this additional workload the complainant found it difficult to carry out all his workload and he went to the CEO in January 2016 and the CEO agreed that the complainant should increase his days from 3 to 5 days. On 2^nd February 2016 the complainant’s son was taken ill and transferred to Temple Street Hospital for 3 weeks. When his son’s condition improved the complainant returned to work on 2^nd March 2016 and worked a half day. He emailed the HR department to advise that he was back at work and would be resuming the full time hours.

On 4^th March 2015 the complainant received a phone call from the Operations Manager Ms C to attend a meeting in her office where he was informed that he was being made redundant due to a downturn in customer requirements. On 22^nd April 2016 the complainant sent an email to HR detailing his concerns specifically requesting to know “why I did not receive prior warning that redundancy may occur” and “what were the selection criteria used when you arrived at this decision…”and requesting a meeting which was held on 5^th May 2016. The complainant met with the Operations Manager at this meeting and she stated that she was not able to answer all his questions and a second meeting, referred to as the grievance meeting, was held on 27^th May 2016 with the Financial Controller and the Operations Manager. The complainant outlined his unhappiness with the meeting and stated that he felt that his questions were not being answered. A further meeting took place on 14^th June 2016 where the complainant was told that he was being made redundant owing to a downturn in the business but that the complainant stated that this note did not detail answers to his specific questions around lack of consultation and the selection criteria used.  

While the respondent has stated that the work involving Controller X was largely redundant the complainant disputes this and claims that this role has not been made redundant and it has now been filled by his previous subordinate Mr A whom he has coached and mentored since he started in April 2014 and that he would have been able to do the work that was required with Controller Y.

The complaint’s solicitor wrote to the respondent on 19^th June 2016 requesting clarification which was replied to on 22^nd July 2016, but which the complainant stated that owing to the respondent’s failure once again to respond adequately to the complainant’s questions he was left with no alternative but to refer his complaints to the Workplace Relation’s Commission.

The complainant outlined that he had taken efforts to secure other employment including completing an on line web developer course to extend his skill set and had received a number of rejections and unsuccessful interviews before he successful secured a role on 8^th August on a salary of €60,000.

The complainant cited a number of cases including Kenny v Beacain (Rea na Doire) Teo [1992] ELR 107, Melroy v Floraville Nurseries Ltd UD 703/1993 in relation to his claims that a genuine redundancy did not exist and Roche v Richmon Earthworks Ltd UD 329/97, Clehane v Gouldings Chemicals Ltd UD 280/1987 and Boucher v Irish Productivity Centre [1990] ELR 205 in relation to the unreasonableness and unfair selection process. Without prejudice to the unfair dismissal’s claim, it was stated that increasing the complainant’s hours from 3 days per week to a 5 day week should have been the criteria used when paying the complainant his redundancy.

Issues for Decision:

Was the complainant unfairly dismissed?

Was there a genuine redundancy situation in the respondent’s business?

Was the complainant unfairly selected for redundancy?

Did the complainant receive appropriate redundancy payment?

Legislation involved and requirements of legislation:

Section 6 of the Unfair Dismissals Act 1977 puts the burden of proof squarely on the Respondent.

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.

Section 6(4) goes on to state

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

(d) the employee being unable to work or continue to work in the position which he held without contravention (by him or by his employer) of a duty or restriction imposed by or under any statute or instrument made under statute.

Section 7(2) of the Redundancy Payments Act 1967-2003 as amended defines redundancy as:

"[A]n employee who is dismissed shall be taken to be dismissed by reason of redundancy if the dismissal is attributable wholly or mainly to:

(a) the fact that his employer has ceased, or intends to cease, to carry on the business for the purposes of which the employee was employed by him, or has ceased or intends to cease, to carry on that business in the place where the employee was so employed, or

(b) the fact that the requirements of that business for employees to carry out work of a particular kind in the place where he was so employed have ceased or diminished or are expected to cease or diminish, or

(c) the fact that his employer has decided to carry on the business with fewer or no employees, whether by requiring the work for which the employee has been employed (or had been doing before his dismissal) - to be done by other employees or otherwise, or

(d) The fact that his employer has decided that the work for which the employee has been employed (or had been doing before his dismissal) - should henceforward be done in a different manner for which the employee is not sufficiently qualified or trained, or

(e) the fact that his employer has decided that the work for which the employee has been employed (or had been doing before his dismissal) should henceforward be done by a person who is also capable of doing other work for which the employee is not sufficiently qualified or trained."

 Findings:

Section 8(1B) of the Unfair Dismissals Act, 1977 requires that I make a decision in relation to the unfair dismissal claim. Section 39 of the Redundancy Payments Act, requires that I make a decision in relation to the complaint.

Section (7) of the Unfair Dismissals Act 1977 (as amended) reinforces the concept of procedural fairness which the Employment Appeals Tribunal had developed since the Unfair Dismissals Act enactment and which requires that the employer establish not only that it had substantial grounds justifying dismissal but also that it followed fair and proper procedures before dismissal.

Section 7.   Without prejudice to the generality of subsection (1) of this section, in determining if a dismissal is an unfair dismissal, regard may be had, if the rights commissioner, the Tribunal or the Circuit Court, 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

Section 5 of the Unfair Dismissals (Amendment) Act 1993 provides, inter alia, that:

… in determining if a dismissal is an unfair dismissal, regard may be had … to the reasonableness or otherwise of the conduct (whether by act or omission) of the employer in relation to the dismissal.

The onus is placed on the Respondent to justify the dismissal and where the Respondent seeks to rely on the redundancy defence, the following criteria must be met:

• A genuine redundancy situation must have arisen

• The dismissal resulted wholly or mainly from that redundancy situation and

• The employee made redundant was fairly selected 

   

  While the employer does not have a statutory obligation under the Unfair Dismissals Acts to consult with employees, decisions from the Employment Appeals Tribunal have clearly detailed the duty for employers to consult in terms of their duty to act reasonably. What this in effect means is that a reasonable employer should:

  -        Give as much advanced warning as possible of a proposed redundancy

  -        Set out in writing the objective selection criteria

  -        Apply the selection criteria consistently and

  -        Consult and explore alternatives to the redundancies

   

  In the case of UD/993/2009 (names of parties redacted) the Employment Appeals Tribunal set out that:

   

  “In cases of redundancy, best practice is to carry out a genuine consultation process prior to reaching a decision as to redundancy. While in some cases there may be no viable alternative to the making of one or more jobs redundant, whatever consultation process is carried out, the employer who fails to carry out a consultation process risks being found in breach of the Unfair Dismissals Act as such a lack of procedures may lead to the conclusion that an unfair selection for redundancy had taken place.”

   

  Having read the submissions and listened to the evidence in this case, I find no evidence of any consultation with the complainant or an objective selection criteria used. While this may be acceptable in certain circumstances as outlined by the respondent in their submission, I cannot support their statement in their letter dated 14^th June 2016 that consultation “would be pointless and of no value as there were no other roles the individuals affected were suited to”. Their decision not to consult is clearly flawed as Mr A’s role was retained and with no selection criteria available it was not transparent as to why exactly the complainant was released and the role of his colleague Mr A, with less service, was retained.

   

  The respondent has argued that the basis for retaining this employee was firstly, owing to him being more experienced in Controller Y, secondly, his qualifications were acquired from a more appropriate third level institution and thirdly his degree was more suitable as it was in the area of electronics.

   

  If these are examined in turn it was very clear from the evidence of the IT Consultant, Mr B, that it would not have taken much time for the complainant to become more knowledgeable in the workings of Controller Y, therefore, I find no evidence that the complainant could not have becoming sufficiently trained up in the workings of Controller Y in a very short period of time.

   

  With regard to Mr A having a qualification from a more appropriate third level institution and the respondent dismissing the complainant’s qualifications because they were ‘on-line’ qualifications, I note that the complainant’s qualifications were acquired from Cardiff University, University of Glamoran now known as University of South Wales, as well as a subsequent qualification in Java from Open University. If these third level institutions or his third level qualifications were of an inferior nature, no evidence was provided as to why the respondent thought so, therefore I find no evidence that the complainant was not sufficiently qualified for the role which was retained in the IT department and for which Mr A was engaged for.

   

  With regard to Mr A having a qualification in electronic engineering whilst the complainant’s primary degree was in Economics, the respondent advised that they may require the skills acquired from this type of electronics degree in the future. While I can understand that an employer may require a skill set in the future I cannot ignore that to date Mr A has been engaged in the same work which he was engaged in prior to the redundancies; work which the complainant could also have been engaged in as per the evidence of Mr B. Had there been a consultation element to the redundancy selection process and a clearly defined selection criteria used, the decision taken may well have been the same ie to release the complainant owing to say the role for which Mr A was engaged for being a role of a lesser salary and it may then have been deemed not suitable alternative employment but as no consultation nor transparent selection process was made available despite the complainant repeatedly requesting same, I find no evidence that the complainant was not sufficiently qualified for the role which was retained in the IT Department, a role held by Mr A.

   

  While I find it extremely unusual that an organisation would significantly increase the hours of one of their employees 2 months before a redundancy situation and then determine that that employee’s role has become redundant, overall, I find that on the balance of probabilities and taking into consideration the evidence of Mr C, the Financial Controller, there does appear to have been a genuine redundancy situation. I also find that the normal working hours of the complainant was 24 hours and not 40 hours based on the reference in the email to it being a “short term arrangement”. However, based on the evidence presented to me the selection process would appear flawed. There was no consultation and no transparent selection criteria made known to the complainant. With a heavy onus on the employer to prove that his act is reasonable and fair towards the employee selected for redundancy I find that the complainant’s dismissal was unfair.

   

  The complainant is under an obligation to mitigate his loss by actively seeking alternative employment. I have reviewed the efforts that the complainant made to seek further employment and I dismiss the suggestion by the respondent that the complainant should have secured employment earlier and I am satisfied that the complainant made sufficient efforts to mitigate his loss and is currently working.

   

As the complainant has secured other employment, I deem compensation as the most appropriate remedy. The complainant was out of work for 21 weeks and in accordance with Section 4 of Statutory Instrument 287/77 (Unfair Dismissals - Calculation of Weekly Remuneration Regulations, 1977) I regard “the number of hours that was normal for the employment” to be 24 hours as it is clear from the email (dated 12^th January 2016) which states that the increased working hours was a three week “short term arrangement”. Had he remained in employment up to the date of the hearing, his earnings from termination on 18^th March 2016 to 25^th November 2016 would have been €27,720 (36 weeks x €770). His earnings since 8^th August 2016 to 25^th November 2016 have been €18,464 (16 x €1,154). Taking into consideration s. 7 of the Act of 1977, which includes:-

(i) if the employee incurred any financial loss attributable to the dismissal, payment to him by the employer of such compensation in respect of the loss (not exceeding in amount 104 weeks remuneration in respect of the employment from which he was dismissed calculated in accordance with regulations under section 17 of this Act) as is just and equitable having regard to all the circumstances,

and taking into consideration the complainant has received a payment in lieu of redundancy, I award the additional sum of €4,620 (six weeks pay). For the avoidance of doubt this award is in addition to all sums already received in connection with the termination of his employment.

Decision:

CA-00006238-001

I uphold the complaint and find that the complainant was unfairly dismissed. Accordingly I award him €4,620 in compensation for his unfair dismissal (six weeks pay).  As this award is made for the breach of his rights under the act and not in lieu of wages it is not taxable. For the avoidance of doubt this award is in addition to all sums already received in connection with the termination of her employment.

CA-00006238-002 - Complainant under Section 39 of the Redundancy Payments Act, 1967

As I have already found and decided that the Complainant was unfairly dismissed and awarded him compensation for that unfair dismissal under the Unfair Dismissals Act, it is not possible, necessary or appropriate for me to consider that dismissal or award him redress again under this Act in relation to that dismissal, I must find, declare and decide that the complaint under the 1967 Act is not well founded; it is rejected and is not upheld.

Dated:   12^th April 2017