EMPLOYMENT APPEALS TRIBUNAL
CASE NO.
UD800/2015
CLAIM(S) OF:
Emmet Florish
-claimant
against
Alienvault Inc.,
-respondent
under
UNFAIR DISMISSALS ACTS 1977 TO 2007
I certify that the Tribunal
(Division of Tribunal)
Chairman: Ms. K.T. O'Mahony B.L.
Members: Ms. M. Sweeney
Mr. J. Flavin
heard this claim at Cork on 5th October 2016
Representation:
Claimant: Mr. Eoin Clifford B.L. instructed by Ms. Eleanora Taylor, Taylor Solicitors, Unit 3a River House, Blackpool Retail Park, Cork
Respondent: Ms. Mary Paula Guinness B.L. instructed by Ms. Sally Doyle, Eversheds, One Earlsfort Centre, Earlsfort Tce, Dublin 2
Background:
The claimant was employed with the respondent company from 2 December 2013 until 2 June 2015. He commenced employment with the respondent as a Director of Inside Sales EMEA with a salary of €75,000. He had primary responsibility for setting up the Cork office which continued to grow throughout his employment. As a result of his exceptional performance he was promoted to the position of Senior Director in early 2015, his salary was increased to €96,250.00 and in early May 2015 he was granted an additional 2,000 stock options. The vesting schedule for the stock options was a 48 month period with 1/48 of his shares vesting as of the end of each month with the first month of vesting being January 2015. The claimant was summarily dismissed on 2 June 2015. The respondent conceded that the dismissal was unfair.
The letter of offer to the claimant, his contract of employment and the share option agreement were opened before the Tribunal.
The claimant confirmed to the Tribunal that he had exercised the stock options which had vested up to the date of his dismissal. The claimant sought a remedy of re-instatement as he believed the stock options to be of a high value should the respondent company announce an IPO. The remedy of reinstatement was opposed by the respondent.
The claimant was out of work for three months.
Determination:
The case before the Tribunal was to ascertain the appropriate remedy in circumstances where the claim for unfair dismissal was conceded by the respondent. The Tribunal has to determine which remedy to award the claimant and if that remedy is compensation whether the unvested stock options should form part of any remuneration for the purposes of calculating that compensation. Substantial and complex information was provided to the Tribunal on the components of the claimant’s remuneration package.
Finding No.1. Having considered the matter the Tribunal determines that compensation is the appropriate remedy for the claimant’s unfair dismissal. It notes that the claimant found new employment three months after his dismissal carrying a slightly greater salary than he had with the respondent and with similar commission structure.
In turning to calculating that compensation the Tribunal considered the letter of offer to the claimant, his contract of employment and the share option agreement. The relevant terms are set out in the letter of offer and the share option agreement.
The respondent’s letter of offer to the claimant, sent to him on 26th November 2013 and signed by the claimant on 28th November 2013, stated:
“You will receive an annual salary of €75,000.
“upon meeting the Company’s eligibility requirements …you will be entitled to participate in: the company’s sales commission plan, details of which will be sent to you separately. Your annual Commission target will be €75,000.
an appropriate PRSA
the health insurance scheme provided by the company
The letter of offer further stated:
As a separate matter to your employment, you may be granted an option to acquire 17,500 shares in [the respondent] at the discretion of its board through our US plan or a sub-plan, which will be unapproved in Ireland (the “Plan”), subject to the terms of any such scheme.
Finding No.2. Giving the words ‘As a separate matter to your employment’ their ordinary literal meaning the Tribunal finds that the stock options do not form part of the claimant’s remuneration.
The respondent’s Early Exercise Non-Qualified Stock Option Agreement at section 1 relates to Vesting, Exercisability and Termination. At section 1(c)(ii) the agreement states:
Other termination:
If the Optionee’s Service Relationship terminates for any reason other than death or Disability, and unless otherwise determined by the Committee, this Stock Option may continue to be exercised, to the extent the Shares are vested on the date of termination, for a period of 90 days from the date of termination or until the Expiration Date, if earlier, provided however, if the Optionee’s Service Relationship is terminated for Cause, this Stock Option shall terminate immediately upon the date of such termination.
For purposes hereof, the Committee’s determination of the reason for termination of the Optionee’s Service Relationship shall be conclusive and binding on the Optionee and his or her representatives or legatees and any Permitted Transferee. Any portion of this Stock Option with respect to Shares that are not vested and exercisable on the date of termination of the Service Relationship shall terminate immediately and be null and void.
Under these paragraphs, the claimant is entitled to exercise his stock options that are vested by the date of the termination of his employment and may do so within 90 days following the dismissal. The claimant’s evidence was that he had had exercised his vested stock options.
Finding No.3. The unvested stock options at the time of the dismissal should not and do not form part of the assessment of loss in this case.
Having taken into account the loss of pay incurred as a result of the dismissal and both the loss of commission as well as the differential in the commission between the two employments and the claimant’s future financial loss, the Tribunal awards the claimant the sum of €105,000 (comprising of the sum of €83,000 for loss to the date of hearing and €24,000 for future loss due to commission differential).
Accordingly, the Tribunal awards the claimant the sum of €105,000.00 under the Unfair Dismissals Acts, 1977 to 2007.
Sealed with the Seal of the
Employment Appeals Tribunal
This ________________________
(Sgd.) ________________________
(CHAIRMAN)