ADJ-00004625

ADJUDICATION OFFICER DECISION/RECOMMENDATION

Adjudication Reference: ADJ-00004625

Parties:

Complaints:

Date of Adjudication Hearing: 24/04/2017

Workplace Relations Commission Adjudication Officer: Eugene Hanly

Procedure:

In accordance with Section 41 of the Workplace Relations Act, 2015 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.

Background

The Complainant was employed as a Project Manager from 18^th July 2013 to 25^th August 2016. He was paid €47,500 per annum. He has claimed that his employer failed to honour his terms and conditions and has breached Regulation 4, the employer made an illegal deduction from his wages and he was constructively dismissed due to the conduct of his employer.

1) Protection of Employees Transfer of Undertakings Regulations 2003.

CA 6617-001

Complainant’s Submission and Presentation:

Respondent’s Submission and Presentation:

The Complainant transferred into the Respondent’s employment on 1^st April 2016. They had engaged in a due diligence exercise and had met him on 11^th March 2016. There was some harmonisation between the merging companies and it was decided that where benefits were more favourable in the current employment these benefits would be given to the transferring employees. There was much discrepancy between the Complainant’s account of his earnings and that provided by the Transferor. The Transferor had communicated that his base salary was €42,378 where as he asserted on 11^th March that his salary was €53,000. A contract was signed on 29^th March 2016 with a base salary of €53,00 as asserted by him. Upon examination of his P45 and payslips it was discovered that the figure of €53,000 was incorrect and was significantly higher than his actual earnings. Meetings took place on 1^st, 15^th and 19^th April 2016 to discuss this discrepancy. It was clear that the figure of €53,000 was significantly higher than his entitlements. The Respondent as a gesture of goodwill offered a salary of €47,500 some €2,500 greater than his pre-transfer pay, plus vouched expenses. He would also benefit from other terms which he had not enjoyed with the Transferor such as health care and this make his total package amount to €53,745.They provided him with a new ‘phone and expenses. He provided no evidence of any agreement to pay him an increase of €2,500 in June 2016. A meeting took place on 9^th May which affirmed that the offer was in fact greater than his pre-transfer salary. The Respondent also advised that because of the overpayment in April, May and June they would recoup the overpayment in line with clause 25.1 of his contract. He was issued with a revised contract of employment on 13^th May which amended the pay section to reflect the revised salary of €47,500.He then raised a grievance over his pay. The Account Manager heard this grievance. For this meeting the Complainant provided information not previously seen by the Respondent. The total amount of his package alleges to be €48,125.The Respondent’s position is that some of benefits do not transfer. The investigation into his grievance was a comprehensive one which took time. Unfortunately he resigned on 25^th August with immediate effect, prior to the culmination of the grievance process. The report was issued on 26^th August 2016. The grievance of bullying and harassment was not upheld. The grievance that management had behaved inappropriately and engaged in tactics to force him to exit found that this was not upheld. The grievance that the TUPE process was incorrect was found that there was disagreement about the data provided. But the process was adhered. The grievance that his salary was incorrect it was found that following numerous meetings and a failure to find a compromise a salary was decided upon by management based on information provided. He was aware of his right to appeal the outcome.

It is the Respondent’s position that the base salary provided to them by the Transferor was €42,378. He was erroneously paid €53,000. The Respondent as a gesture of goodwill was willing to pay €47,500. The salary provide by the Respondent was at all time in excess of his pre transfer salary. The Respondent has met and exceeded its obligations under Regulation 4 with regard to his base salary. There was no contractual entitlement to a salary increase in June 2016 of €2,500. A commitment to review a salary does not form part of the Complainant’s terms and conditions. The salary offered and paid by the Respondent has surpassed his salary with the Transferor.

Had he opted to join the pension scheme he would have had an additional €1,425 contribution. No mobile ‘phone package was included in his package with the Transferor. The alleged expenses of €4,694 per annum are contradicted in correspondence provided by the Transferor dated 8^th August. The Respondent operates vouched expenses. The Complainant has cited €48,125 as his package. The Respondent affirms that the package offered was more favourable. While certain aspects of the package were not identical the Respondent is well within its rights to harmonise conditions of employment.

It is their position that it has at all times complied with Transfer Regulations. The total package offered was far in excess of the value of the totality of terms and conditions he purports to have been owing to him on the date of the transfer.  If a breach was found no compensation is warranted.

 Findings

I note that the due diligence identified the Complainant’s base salary only.

I note that following a meeting the Respondent in good faith supplied data to its UK office and a salary of €53,000 was agreed and signed off on.

I note that the Respondent subsequently decided, based on data provided that the salary offered was in excess of what they believed he was due.

Following a further meeting they offered a salary of €47,500 as a gesture of goodwill but this was rejected by the Complainant.

I find that the due diligence exercise did not produce the specific details of the remuneration package, which it should have done.

I found that all the evidence from the Complainant was not specific. He relied upon the alleged promise of a salary review.

I find that a salary review is not a salary revision; it is a commitment to examine/review it but doesn’t guarantee revision.

I find that reference to expenses was vague while the Respondent affirmed that they would only pay vouched expenses.

I note that the Respondent wanted to harmonise conditions of employment.

I find that this complaint emanated from the due diligence which was not comprehensive.

I find that there was still conflict over what exactly constituted the Complainant’s terms and conditions.

I note that the Respondent agreed to pay a salary of €53,000 and signed an agreement to do so.

I find that they should have adhered to that.

Therefore I find that the Respondent has breached Regulation 4.

Decision:

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

I have decided that the Respondent has breached Regulation 4.

I order the Respondent to pay the Complainant a salary of €53,000 per annum from the date of transfer and any arrears due should be paid within six weeks of the date below.

I have decided that the Respondent should pay the Complainant compensation of €2,000 for breach of his rights under these Regulations. This should be paid within six weeks of the date below.

2) Payment of Wages Act 1991 - CA 6617-002

Complainant’s Submission and Presentation:

This complaint was withdrawn

3) Unfair Dismissals Act 1977 CA 6617-003

Complainant’s Submission and Presentation:

The Complainant stated that all the problems and issues relating to his transfer of undertakings complaint contributed to his decision to resign. He had raised grievances but an investigation meeting was postponed on three occasions. A colleague left the company after the transfer and extra work was given to him. He was being micromanaged and he was questioned about going for breakfast one morning after starting time also he left early one Friday and told a colleague but was reprimanded about this. He was allocated duties which were not in his area of expertise. A job became available but he was not told about it. He heard that a senior manager didn’t want him going for it. He became concerned about the policies, procedures and processes in place.

He left because he believed that his grievance was not going to be properly addressed, his salary was unilaterally reduced. He was out of work for 3 to 4 weeks. He then got a job at an annual salary of €53,000 per annum for three months and then he got a permanent position since December 2016 at €50,000 per annum. He has sought compensation.

Respondent’s Submission and Presentation

The Respondent stated that no dismissal took place. The Complainant voluntarily resigned his position. They were reasonable in their dealings with him. They cited Sec 1 of this Act in support. They relied upon the two tests of reasonable conduct and exhausting procedures.

They cited the Employment Appeals Tribunal case McCormack v Dunnes Stores UD 1421/2008

“The notion places a high burden of proof on an employee to demonstrate that he or she acted reasonably and had exhausted all internal procedures formal or otherwise in an attempt to resolve his/her grievance with his/her employer. The employee would need to demonstrate that the employer’s conduct was so unreasonable as to make the continuation of employment with the particular employer intolerable”.

The Respondent‘s position is that they acted reasonably in that they informed the Complainant about the error in calculating his salary package. They held a number of meetings with a view to resolving the matter. His base salary at the transfer date was €42,287 not €53,000 as alleged. They then in good faith offered him €47,500 which was far in excess of his salary to resolve this matter. They acted reasonably in reclaiming the overpayments over a period of 8 months. They appointed an independent manager to investigate his grievance. He was afforded the right of representation. The Complainant raised an internal grievance and it was investigated on 9^th August 2016. It was not possible to conclude the investigation within the usual 10 days and he was advised that the report would issue during the week 22^nd -27^th August. He resigned his position on 25^th August. He failed to utilise and exhaust the grievance procedure. He did not act reasonably in doing so. He should have awaited the outcome of the investigation and he would have had the option to appeal the outcome if necessary. Therefore the complaint is rejected.

Findings

I note the Complainant’s concerns about the transfer and the issues relating to his alleged reduction in salary.

I have adjudicated on this matter in the above decision.

I note the frustration on both parties to this dispute concerning the lack of clarity concerning his terms and conditions.

However this is a complaint of constructive dismissal.

In a constructive dismissal claim the burden of proof shifts to the person making the claim. They also have to demonstrate that they were justified in their decision and it was reasonable for them to resign. The complainant needs to demonstrate that they have no option but to resign. In addition there must have to be something wrong with the employer’s conduct.

In UD 1146/2011 the EAT held “in such cases a high level of proof is needed to justify the Complainant’s involuntary resignation from their employment, i.e. he must persuade the Tribunal that his resignation was not voluntary”.

It is well established that the Complainant is required to exhaust the company’s internal grievance procedures in an effort to resolve her grievance prior to resigning and initiating a claim for unfair dismissal. In UD1350/2014 M Reid v Oracle EMEA Ltd the EAT stated; “It is incumbent on any employee to utilise and exhaust all internal remedies made available to him or her unless he can show that the said remedies are unfair”

Tierney v DER Ireland Ltd UD866/1999 “central to this is that she shows that she has pursued to a reasonable extent all internal avenues of appeal without a satisfactory or reasonable outcome having been achieved”.

I note in the EAT case John Travers v MBNA Ireland Ltd [UD720/2006] it stated, “We find that the claimant did not exhaustthe grievance procedure made available to him by the respondent and this proves fatal to the claimant’s case…In constructive dismissal cases it is incumbent for a claimant to utilise all internal remedies made available to him unless good cause can be shown that the remedy or appeal process is unfair”.

The EAT in Donnegan Vs Co Limerick VEC UD828/2011 stated, “In particular, the claimant must show that the respondent acted in such a way that no ordinary person, could or would continue in the workplace”. Also the respondent’s conduct was “not so unfair or so damaging to the claimant’s rights and entitlements that she hid no option but to resign her position”

In Murray v Rockavill Shellfish Ltd [2002] 23 ELR 331 the EAT stated, “It has been well established that a question of constructive dismissal must be considered under two headings, Entitlement and Reasonableness. An employee must act reasonably in terminating his contract of employment. Resignation must not be the first option taken by the employee and all other reasonable options including following the grievance procedure must be explored. An employee must pursue his grievance through the procedure laid down before taking the drastic step of resigning”.

The Labour Court UDD 1635 Mary Kirrane v Barncarroll Area Development Co Ltd stated, “Where constructive dismissal is contended for it is for the person making the claim to establish that the behaviour of the employer was such as to leave the appellant no alternative but to terminate the employment or that the employer’s behaviour has fundamentally undermined the employment relationship. The person claiming constructive dismissal has an obligation to access available grievance procedures in a course of attempting to deal with whatever situation has led to consideration of termination of the employment”.

In this case I have found that the circumstances regarding the actual terms and conditions of employment were unclear.

I find that the Respondent had set out their actions to justify the salary of €47,500 but that didn’t meet the expectations of the Complainant.

I find that they then decided to act unilaterally and impose the salary of €47,500 and implement a process to recoup the monies they believed were overpaid.

I note that the Complainant raised a formal grievance.

I note that there was a short delay in producing the report and I note that they had to rely upon a UK based person to act independently.

I find that the Complainant did not act reasonably in resigning his position before the outcome of the investigation, especially given the fact that he was advised that it would issue between 22^nd and 27^th August.

I have set out a number of decisions from the EAT which sets the bar at a high level to succeed in a claim for constructive dismissal.

I find that the Complainant failed to fully utilise and exhaust the grievance procedure.

I find that he has failed to meet that bar and so he cannot succeed with his complaint.

Decision

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.

For the above stated reasons I have decided that this complaint should fail.

Dated:   5^th July 2017

Workplace Relations Commission Adjudication Officer: Eugene Hanly