ADJ-00002731

Complainant

Respondent

Anonymised Parties

An Employee

A Credit Union

Act

Complaint/Dispute Reference No.

Date of Receipt

Complaint seeking adjudication by the Workplace Relations Commission under Regulation 10 of the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003 (S.I. No. 131 of 2003)

CA-00003735-001

07/04/2016

The complaint has been brought under the Transfer of Undertakings Regulations 2003. The Complainant was employed as a Finance Officer with Credit Union A (the transferor) and complains that the terms and conditions of his employment were not transferred to Credit Union B (the transferee) the time of transfer.

A preliminary application was brought by the Respondent. It was that the Adjudicator had no jurisdiction to hear the case as the claim was compromised by way of Termination Agreement (which was an agreement to accept a voluntary redundancy package). It was dated 13 October 2015 and signed by both parties.

The Termination agreement contains a waiver of the Complainant’s statutory employment rights, including the Transfer of Undertakings Regulations 2003. For the purpose of this decision the Termination Agreement is alternatively referred to as a waiver agreement and/or a redundancy agreement.

1. The Termination agreement is not binding and the case should be permitted to proceed to a substantive hearing.
2. The Complainant was not legally advised before signing the agreement and as such his consent was not fully informed.
3. While it is accepted that the Complainant was represented by a trade union representative, this was for the purpose of advising him on his rights on the transfer of undertaking. He should have been afforded legal advice that was independent of the transfer process.
4. The Termination agreement was presented at a meeting on 13 October 2015 and the signature of the Complainant was requested at that meeting and no opportunity was allowed for the Complainant to get advice from a solicitor. As a result the Complainant felt under pressure and compelled to sign the agreement.
5. The Complainant does not raise any specific criticism of the advice given to him by his trade union representative. Indeed, in interpreting the case law on waivers, he does not query that a trade union official’s advice can constitute legal advice. He accepts that trade union officials are often more experienced than solicitors in employment matters. So the adequacy of the advice is not at issue in this case.
6. However where a trade union official has been involved in negotiating terms in a transfer of undertaking, he or she is not sufficiently “independent” (Kinsella case) to then advise a Complainant on a subsequent waiver agreement. What should have occurred was that that trade union official should have stepped aside and allowed a fresh trade union official, one who was independent, to advise the Complainant on the waiver. This is what the case law suggests.
7. The failure to do so or the failure, by the Respondent, to specifically suggest that he obtain independent legal advice renders the Complainant’s consent to the waiver, to be not fully informed and therefore defective.
8. The Complainant argues that it was always the intention of the Respondent to get rid of him. The evidence of this is that during the course of meetings, the CEO of the transferee Credit Union (from 19 August onwards) allowed him believe that a job, on the same terms and conditions as he had previously enjoyed, would be created for him. However suddenly and without warning on 23 September, when the transfer had already occurred, there was no longer a post for him on the same terms.
9. He contends that there was no coincidence about this. Had he known, prior to the transfer taking place, that he was not going to enjoy the same terms and conditions, he could have made a complaint under the Central Bank rules to prevent the transfer occurring. However he believed what he had always been told by his board of management that he would keep his job on the same terms and conditions and consented to the transfer. The representations made by the CEO at all the meetings up until 23 September, confirmed this.
10. It was only after the transfer had taken place, that he was informed that he would not be retained on his old terms and conditions.
11. Therefore when he signed the agreement on 13 October he was suffering from shock and depression. He could not believe the betrayal, after years of loyal service and he felt tricked by having been promised something that did not materialise.
12. He gave evidence that he did not know what he was signing when he signed the document, that he was upset (although he accepts that would not have been apparent because he maintained his composure throughout) but that he didn’t discuss the agreement before signing it. He just signed it to get the whole unpleasant business over and done with.
13. He feels that if someone had slowed him down at the last meeting and explained to him that he had rights under the Transfer of Under taking regulations that were enforceable, he might have not signed the agreement.
14. In this way, his consent was not fully informed.
15. The waiver should not be permitted to stand.
16. The Termination agreement is binding in that it fulfils all the criteria in the case law dealing with the waiver of employment rights.
17. The Complainant, with his trade union representative, attended a number of meetings with the Respondent over a period of months. During this period it was made clear to him that the possible outcomes of the transfer of undertaking were either that he would be retained in a different job capacity or be made redundant (for economic, organisational or technical reasons). Minutes of these meetings evidence that and are not denied.
18. The Complainant knew from the meeting held on 19 August 2016 that he would not be retained in the position of Finance Officer in the transferee Credit Union. This was because there was already a more qualified Finance Officer in place there.
19. At any stage during the two months before he accepted the redundancy package, he could have sought advice from a solicitor but did not. However his trade union representative was with him at all the meetings and a trade union representative’s advice is adequate for the purpose of advice on a waiver.
20. The transfer took place on 7 September 2016.
21. It is accepted that at all the meetings, up until 23 September, it was believed by the CEO of the Respondent that a job could be made for the Complainant. He believed that the job offer (as Finance Support Officer) would be suitable for the Complainant because even though it had a lower salary, an arrangement would be made to give the Complainant once off payments to bring him up to his former salary of €49,000. However no firm offer was made to the Complainant about this it was a discussion only and the Board of Directors ultimately advised the CEO against it because it did not amount to a full time position and therefore salary could not be justified.
22. This resulted in the Complainant being informed at the meeting of 23 September that no such arrangement was possible and that his options were either to accept a temporary position on a lesser salary (of 35k) or accept a redundancy package (worth 35k)
23. The details of the temporary job details were furnished to the Complainant soon after 23 September and he was allowed time to consider his options. During this time he admits that he discussed the options with his trade union representative.
24. They both attended a meeting on 13 October and it was clear from the outset of the meeting that the job offer was being rejected and the Complainant had decided to accept the redundancy package.
25. In fact the only matters discussed at the meeting on 13 October were the redundancy package and whether that could be improved financially.
26. There was no suggestion of pressure being put on him. At the meeting on 13 October the Complainant had three choices which were:   to accept the redundancy package voluntarily (on better terms than statutory), to accept the temporary post or not. If he did not accept the redundancy on a voluntary basis it was likely that he would be made compulsorily redundant at a later stage and would receive only the statutory redundancy entitlement. For economic, organisational and technical reasons, the Complainant could not be retained in the position that he had previously held and had been informed of this, so it was fully within its remit to treat the Complainant’s position as redundant and if he did not accept the voluntary package, then they would proceed on an involuntary basis.
27. The CEO was not surprised when the Complainant opted to accept the redundancy package being offered. It made sense to do so. He suspected, although did not know that the trade union representative would have advised him as such.
28. Furthermore at the meeting when the Complainant asked for more than what was being offered, the CEO contacted the Chairman of the Board to get sanction to make further additional payments to the Complainant.
29. The Complainant was allowed time with his trade union representative to look through the termination agreement prior to signing it.
30. The Complainant then signed the Termination Agreement which included a waiver of his rights.
31. The terms of the waiver took the following form:

The Complainant accepted that he was made redundant and that in consideration of this he would be paid €35,000.00 “in full an final settlement of all claims, complaints…arising under contract..tort ..and statute including but not limited to ..(the specific Acts were then listed including the Transfer of Undertaking Regulations 2003.”

7. The agreement was then signed by the parties and witnessed.
8. To say that he was pressurised into signing the agreement is not factually correct in that he had three weeks to consider the situation.
9. He was informed of the impending redundancy at a meeting on 23 September 2016, he received temporary job offer, albeit on a lesser salary, sometime in between the 23 September and 13 October. At the meeting on 13 October, having rejected the temporary post he elected to accept a voluntary redundancy package; which was on much more favourable terms than the statutory entitlement.
10. The meeting on 13 October was only about discussing the terms of the redundancy package. Certain further additional payments were requested by the Complainant and the Respondent conceded to these requests in order to “seal the deal.”
11. At no stage during the meeting of 13 October did the Complainant seem upset or uncontrolled in his decision making. He admits himself that he was composed and therefore the Respondent could not have known that he was in shock or confused. He did not appear that way, in fact he did the negotiations for receiving the additional top up payments.
12. He had from 23 September until 13 October to seek legal advice (additional to the advice that he was receiving from his trade union official) but he did not do so. There was no pressure on him to sign.
13. In relation to the adequacy of advice, the law is that the Complainant be advised adequately in order that he understands what rights under specific acts, he is signing away. Trade Union representatives, especially long serving officials are eminently qualified to provide such advice. Indeed no specific criticism has made by the Complainant of the advice given to him by the trade union official.
14. There is no grounds in law or in fact to support a finding that the Complainant did not know what he was doing when he signed the agreement.