ADJ-00004274

ADJUDICATION OFFICER DECISION

Adjudication Decision Reference: ADJ-00004274

Complaint(s)/Dispute(s) for Resolution:  

Date of Adjudication Hearing: 02/11/2016

Workplace Relations Commission Adjudication Officer: Shay Henry

Procedure: 

In accordance with Section 41(4) of the Workplace Relations Act, 201 and section 13 of the Industrial Relations Act, 1969 and following the referral of the complaint to me by the Director General, I inquired into the complaint and gave the parties an opportunity to be heard by me and to present to me any evidence relevant to the complaint.

Complainant’s Submission and Presentation:

In October 2015 the complainant was informed he was to be made redundant. In November the company announced 30 other redundancies in a different plant. The terms of the latter redundancy were in dispute and the matter was referred to the Labour Court. At a meeting in January 2016 the complainant advised the Head of HR, Mr A, that he would be willing to delay payment of the redundancy until the outcome of the Labour Court’s deliberations. Mr A advised him that he would be entitled to whatever came out of the Labour Court process, and that if he delayed payment he would be unable to access social welfare. Mr A wrote on the settlement agreement “The above gross figures will be reviewed again following the outcome of the Labour Court hearing involving SIPTU. Any adjustment could result in part of the payment being subject to PAYE, USC etc”. The agreement was signed by both parties. After the Labour Court recommendation issued in February 2016 the complainant contacted the Head of Hr regarding the payment of the enhanced redundancy. Mr A quoted the recommendation which stated “The recommendations above are intended to be of general application in the case of all future redundancies and have no retrospective effect.” He informed the complainant that the terms only applied from April 2016 – the date when the terms were accepted by SIPTU. 

Respondent’s Submission and Presentation: 

The complainant worked as a store manager in one of the respondent’s outlets. A decision was taken to close this outlet and notice of redundancy was served to the complainant in early November 2015. The complainant’s employment ended on 22 January 2016 and he was given a payment of €53k inclusive of statutory redundancy. As part of the process he signed a settlement agreement. At this time the complainant became aware of the ongoing dispute with SIPTU in respect of the redundancy terms prevailing in the organisation and asked that the terms of his redundancy be reviewed again following the outcome of the Labour Court hearing, in the event that any retrospective entitlement arose. The HR Manager, Mr A, noted this on the settlement agreement. The Labour Court issued a recommendation which was balloted on in April 2016. The redundancy terms were then implemented in full by the company from that date forward with no retrospective application. The matter was not disputed by SIPTU at that time and no reference was made to this case as part of the conciliation conference or the Labour Court hearing.

In the period 2014/2015 more than 75 redundancies were made at the company and during the Labour Court hearing the company submitted that if any retrospection were recommended this would expose the company to a potentially very significant financial burden. The company undertaking was to review the complainant’s package following the outcome of the Labour Court hearing and did so. In implementing the recommendation fully it did not make any adjustment to the complainant’s settlement.

Decision:

Section 41(4) of the Workplace Relations Act 2015 requires that I make a decision in relation to the dispute in accordance with the relevant redress provisions under Schedule 6 of that Act. Section 13 of the Industrial Relations Act 1969 requires me to make a recommendation in relation to the dispute.

Conclusions: 

It is clear from the terms that the Settlement Agreement signed by the complainant and by the Head of HR on behalf of the respondent was intended to be a binding legal agreement. In this regard it is noteworthy that the agreement included a provision to the effect that the employee – the complainant – had been given the opportunity to take independent legal advice. The complainant was not encouraged to seek such advice in relation to the handwritten addendum to the agreement which stated ‘The above gross figure will be reviewed again following the outcome of the Labour Court hearing involving SIPTU. Any adjustment could result in part of the payment being subject to PAYE, USC, etc.’ In the absence of professional advice it was reasonable for the complainant to interpret this addendum, and in particular the commitment to the ‘review’, as meaning that the respondent would pay any enhanced redundancy package that arose from the Labour Court recommendation.

From the evidence provided at the hearing it is clear that the complainant’s position was never discussed at the Labour Court hearing and therefore the Court could not have contemplated issuing a recommendation overturning the binding agreement into which the complainant and the respondent had entered. In addition, I note that the complainant’s redundancy took place in the same general timeframe as those employees who were the subject of the Labour Court recommendation and that he had offered to await the outcome of the Court’s deliberations but had been encouraged not to.

I therefore conclude that the complainant was entitled to receive the enhanced financial benefits as detailed in the Labour Court recommendation LCR 21141/2016. 

Decision: 

I recommend that the respondent apply the improved redundancy package as detailed in the Labour Court recommendation LCR 21141/2016 to the complainant. 

Dated:   22 March 2017