ADJUDICATION OFFICER DECISION

Adjudication Decision Reference: ADJ-00004098

Complaints for Resolution:

Date of Adjudication Hearing: 08/12/2016

Workplace Relations Commission Adjudication Officer: Patsy Doyle

Procedure:

In accordance with Section 41(4) of the Workplace Relations Act, 2015, Section 8(1B) of the Unfair Dismissals Act, 1977, Section 79 of the Employment Equality Act, 1998, and Section 39 of the Redundancy Payments Acts 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.

The Workplace Relations Commission wrote to the complainant on 21 July, 2016 to seek an election of the parallel complaints lodged under the Unfair Dismissals legislation and Employment Equality legislation.

In accordance with Section 101(4A) of the Employment Equality Act 1998, the complaint under the Employment Equality Act 1998 will be deemed to have been withdrawn unless, not later than 41 days from the date of this letter, the complainant withdraws the claim under the Unfair Dismissals Act 1977.

You are now requested to advise the Commission in writing not later than 41 days of the date of this letter if you wish to withdraw the claim under the Unfair Dismissals Act 1977. If you withdraw the claim of unfair dismissal within the 41 day period, the Commission will then make arrangements to process the complaint under the Employment Equality Act 1998.

You should note that if you do not respond to this letter within the 41 day period, your complaint under the Employment Equality Act 1998 will be deemed to have been withdrawn and the Commission will then make arrangements to process the complaint under the Unfair Dismissals Act 1977.

In the absence of a response, the complaint under the Employment Equality Acts was deemed withdrawn on 8 November 2016.

On the day of the hearing, the complainant withdrew the claim under the Redundancy Payments Act, leaving the sole claim before me as the complaint under the Unfair Dismissals Act 1977.

Attendance at Hearing:

                                                     A Boat Builder V A Boat Building Company

 Respondent’s Submission and Presentation:

The respondent disputed the claim of Unfair Dismissal .They confirmed that the complainant, a Polish national had worked at the respondent boat building business from 12 November 2009 until the date of dismissal, due to redundancy in March 2016.

The respondent submitted some background to the decision taken by the company to engage in redundancies in February – March 2016.During 2015 and 2016; the company had experienced significant trading difficulties. Orders had slowed down, cash flow had deteriorated and in September 2015, for the first time in the 18 year existence of the company this was followed by a default on a vessel .This placed the company in a precarious financial position.

There were no new orders for vessels and discussions began within the company on the prospect of having to consider redundancies in December, 2015. The Managing Director chose not to action redundancies at that juncture and invested his personal funds into the company to cover overheads and costs.

In February 2016, apart from finishing one boat, there was no other live work and the respondent’s financial advisors met with the Managing Director and advised cost cutting measures inclusive of redundancy in order to “try and maintain the company’s existence”.

The respondent submitted a copy of a letter received from the financial advisors on 3 February 2016 which sought to confirm this advice.

The respondent made the decision to make 4 laminators redundant on the grounds that no work was available at that time or in the near future .The respondent set out a briefing note to the four affected employees on 15, February, 2016.

1 The last order and contract signed was April, 2015.

2 The company set out the skills required to finalise “employee skills set “required to finalise the contract as:

Management

ISO Monitor

Engineering and Electrical Installation

Carpentry

Fit Out

Welder

3 Carpentry and Mould Plug making skills were required for another piece of work.

The respondent submitted that there was no contingency available to the company outside the redundancy of the four Laminators. Previously, the company would have constructed a stock vessel, but this was not possible, due to the fall out from the default in payments.

“Until anew contract is secured, we have no choice other than to reduce our workforce to a level able to complete the current work, and be able to manage the expected level of GRP laminating likely to be required on future orders……

The primary role of GRP laminator is GRP laminating of new contract vessels….

The choice of personnel to be made redundant is based on:

1 Skill set relating to the current work requirement.

2 Terms of employment with preference given to those employed for a longer period “

The respondent submitted a spreadsheet listing the 21 employees of the company and the sub skills set particular to particular employees. The respondent contended that there was no requirement for boat builders and given that all the lamination work on the vessel had been completed, a reduction was needed in Laminators. The complainant was one of four chosen to go, all of whom were listed as laminators and all with service ranging from November 2009 – March 2015.There were three remaining Laminators retained in anticipation of further work.

The respondent confirmed that the decision to make the Laminators redundant was made on February 15.This was followed the next day by way of notice of redundancy to the complainant on 16 February in a face to face meeting. The complainant requested an early payment of his redundancy. This was transferred in full from the Managing Directors personal account to the complainant’s bank account on February 17, 2016, incorporating a 4 week payment in lieu of notice and amounting to €10,693.60. The respondent offered clarification on the weekly hours worked by the complainant as 40 hr standard working week with occasional overtime. His hourly wage was €15.46 per hour.

The respondent submitted that is was a very difficult time in the business and the Managing Director confirmed that there was a high level of stress in the business and everybody would have known and accepted the reasons for the redundancies as they were good friends. There was no language barrier between the complainant and the company. He also confirmed that the complainant’s manager was a Polish national.

Counsel for the complainant asked whether the company had considered voluntary redundancies?. The respondent stated that he had done the best for his company and employees by the selection for redundancy. He did not want a large exodus and made a strategic decision. He confirmed that there was no work for the complainant at the time of his redundancy, while he understood that the complainant had some extended skills, these were not required in the absence of orders on the order book.

The respondent stated that he had not approached No 9 on the list, Mr L2 for rehire, Mr L2 had initiated this himself by being a frequent caller to the business after his redundancy, whereas he had not heard from the complainant .He contended that the complainants submission of a sick note post his departure “closed the door on employment, as he was not looking for work “. The respondent stated that he was unaware that No 7 was intending to leave in August 2016.He was retained as a Laminator and ISO Monitor.

The respondent submitted the company justification for retention of the remaining employees.

In answer to further questions, the respondent submitted that the complainant was given an opportunity to express his views on the proposed redundancy during a two day consultation period. .He did not consider temporary lay off as a viable option as. The company had a grievance procedure.

The respondent confirmed that it was necessary for the business to make four laminators redundant and while some orders had been received since the date of the complainant’s redundancy, the company was still in trading difficulties.

Complainant’s Submission and Presentation:

The complainant is a Polish national employed as a Boat Builder on €15.46 an hour with the respondent from November, 2009.

When he commenced work he worked primarily at lamination and moved towards more of a role in boat building inclusive of

Preparation

Sound Proofing

Grinding

Cabins

Painting inside the boat and the Hull

Deck preparation.

The complainant did not accept that he should have been made redundant after 6 years .He contended that he had been forced out as he was not just a laminator and had acquired a range of skills in the respondent employment. The complainant submitted a contract from 2015 which detailed his role as a boat builder. He submitted that other employees had been unfairly retained in employment, naming other Laminators and Carpenters .

The complainant was aware of the shortage of orders and had asked his manager before Xmas 2015, whether his job was safe? He told the hearing that he was informed that “there were jobs for everyone until April “and took the step of moving his home to be near his work in the town.

The complainant contended that the notice of redundancy given to all 4 employees was different. One of the four had returned back to work for the company .One had returned to Poland, which should have reduced the need to make al 4 Laminators redundant in the first place. Nobody was offered voluntary redundancy. There was no visible sign that the respondent was in financial difficulty as the final payment of €13,000 was made with visible ease by the respondent .He was not happy after he left the employment and took advice from a Solicitor . The complainant remained keen to return to work but had suffered with back injury and commenced sick leave on February 17^th posts an MRI. He told the hearing that he was still in receipt of illness benefit on the day of the hearing.

During cross examination , in response to the respondent statement that no 7 on list of employees , Mr L 1 also had a dual role in ISO accreditation, the complainant accepted Mr L 1 had not submitted his plans to leave the company in advance of the redundancy .

The complainant confirmed that he had submitted a sick note two days after he left employment and had not gone back to the company seeking a return to work. He recalled asking the respondent before he left on 16 February, whether he would be calling him if work became available? And he neither said Yes or No.

The complainant followed the respondent on Social Media on May 3, 2016 and observed that the company had gone on to sign contracts after he left. He was also aware that the company had hired a new employee, a son of another employee on  May 9 as a laminator. He understood that there were ongoing pieces of work to be done at the company and contended that he had been unfairly dismissed by being unfairly selected for redundancy. He sought redress of compensation.

Decision:

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

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.

Section 79(6) of the Employment Equality Act, 1998 requires that I make a decision in relation to the complaint in accordance with the relevant redress provisions under section 82 of the Act.

Section 39 of the Redundancy Payments Act 1967, requires that I make a decision in relation to the complaint in accordance with the relevant redress provisions of that Act.

1 Claim for Unfair Dismissal CA -00005196-001

I have listened carefully to both parties submissions in this case .I have reflected on the evidence adduced.

Section 7(2) of the Redundancy Payments Acts 1967(as amended) defines redundancy and sets out five grounds in which an employee shall be taken to be dismissed by reason of redundancy.

1. For the purposes of subsection (1), an employee who is dismissed shall be taken to be dismissed by reason of redundancy if for one or more reasons not related to the employee concerned ] 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 had 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 had 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 had 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,

In St Ledger V Frontline Distribution ltd [1995] ELR 160, the EAT held that all five sections envisage change of the qualitative variety, not simply quantitative change. Redundancy is based on Impersonality and change .It is the job and not the person which forms the central cog in the process.

Section 6(4)(c ) of the Unfair Dismissals Act states that a dismissal is deemed not to be unfair if it results wholly or mainly from the redundancy of an employee .Section 6(7) of the Act permits me to take account of the reasonableness of the employers conduct in the dismissal .

In Barton V Newfast Freight Ltd (UD 169/2005), the EAT accepted that the company was experiencing trading difficulties but found the dismissal to be unfair as the employee had been kept in the dark about the redundancy and the employer had not handled the dismissal in a reasonable manner .

I must consider this case through the following lens.

1 Can the respondent demonstrate that the redundancy was a genuine redundancy as set out in S.7 (2) of the Act?

2 Was the complainant fairly selected?

3 Can the respondent demonstrate that the company acted reasonably in all the circumstances?

1 Redundancy

I have considered the submissions of the parties in this regard. In listening to the parties, I was struck by the divergence in the views expressed in relation to the run up to the events of mid February 2016. From the respondent side, I noted the pride expressed in an business of 18 years standing that was now on the rocks, with a 50-60% reduction in work and the consequent struggle to do the right thing by his employees, many of whom were friends .From the complainants side, I found a dissatisfaction that he had been selected when he had so much more to offer at the company and others had been retained .I probed the spread sheet and noted that of the three laminators/ISO Monitor chosen to remain ,the dates of employment may go some way to informing that dissatisfaction .

1 24 June 1998

2 24 June 1998

3 6 November 2009 (This was the Laminator/ISO monitor) Number 7

The 2009 date was 6 days in advance of the complainants start date of 12 November 2009 .I found that the complainant took his inclusion in the four chosen personally. At the hearing , he was clear that Number 7 on the list had told the respondent that he was leaving employment prior to the confirmation of redundancies and that that knowledge should have saved the complainant from redundancy .However, I could not establish whether that was put to the respondent in the consultation meeting on February 16 and consequently must accept the respondent evidence in this regard that he was not aware of his intention to resign and could not therefore factor that into the mix at decision making time .

I find that the respondent demonstrated a genuine redundancy in accordance with Section 7(2) (b) of the Redundancy Payments Act 1969. I have found that the complainant accepted that he was made redundant .For me, this demonstrates that the respondent could show a substantial ground justifying dismissal under Section 6(4) (c) of the Act.

2 Selections

As stated earlier , this is the area, in my opinion that has caused the complainant to be most dissatisfied .I listened to both parties presentations in this regard .The respondent was clearly in financial difficulty for 6 months prior to his decision to make redundancies at the company and he deferred on the advice given by his Financial Advisors to commence redundancies sooner .The complainant confirmed that he was aware of some uncertainty within the company which prompted him to seek clarification on his own job security in December 2015 .He had signed a revised contract as a boat builder in June 2015. The complainant confirmed that he was advised that all jobs were secure until April 2016. This strikes me as constituting some prior warning of change.

Section 6  (3) Without prejudice to the generality of subsection (1) of this section, if an employee was dismissed due to redundancy but the circumstances constituting the redundancy applied equally to one or more other employees in similar employment with the same employer who have not been dismissed, and either—

( a) the selection of that employee for dismissal resulted wholly or mainly from one or more of the matters specified in subsection (2) of this section or another matter that would not be a ground justifying dismissal, or

( b) he was selected for dismissal in contravention of a procedure (being a procedure that has been agreed upon by or on behalf of the employer and by the employee or a trade union, or an excepted body under the Trade Union Acts, 1941 and 1971, representing him or has been established by the custom and practice of the employment concerned) relating to redundancy and there were no special reasons justifying a departure from that procedure,

then the dismissal shall be deemed, for the purposes of this Act, to be an unfair dismissal.

The complainant told the hearing that all four employees chosen for dismissal were managed differently .The respondent denied this and referred to the spreadsheet which set out the skills set and service which were the tools used in the decision making process .The respondent submitted that all four had different lengths of service and the statutory “package “differed for all four. The complainant was regarded as the longest server of the four from 2009. The shortest server in the Lamination category was March 2015.The complainant also took issue at the retention of two carpenters with short service to his .

The respondent formulated the factors relied on in the decision making process of redundancies of

1 Skills set required and length of service.

There was no Union agreement on a procedure to be adopted in this instance .Therefore there was no contravention of a procedure.

I understand that the complainant held a strong belief that he was wrongly selected by the respondent for redundancy. He saw his contribution as being far in excess of lamination .I realise that the respondent was faced with a difficult choice in the run up to February 2016 on identifying who should comprise the redundancies . Perhaps, in hindsight, the respondent could have been more specific that redundancies were under active consideration, however, I accept that the order book was empty and there was an air of uncertainty at the time of the redundancies.The company decision to retain the carpenters and the three Laminators was objectively argued at the hearing .

I have considered an analogous case from the EAT in Thomas Cruise V Nugent Manufacturing ltd UD 2099/09, where the EAT in appellate function held that Section 6(3) of the Act had not applied where a Manager had challenged his selection for redundancy.

In the instant case, the decision was taken to make four Laminators redundant in the face of a downturn in business. The complainant accepted the redundancy at first and took advice at a later date to challenge his unfair selection.

The respondent relied on his own two part test for who should go and who should stay. While I have some hesitation in this being a unilateral action and am mindful of the stated versatility of the complainant, I find that this was applied consistently and fairly and those who were retained were justified on skills set and tenure alone .I cannot see that the events post redundancy i.e. some new orders and re hiring can be taken into account in my assessment of selection for redundancy.

I appreciate that the complainant’s illness militated against his seeking to be rehired   in the short term post dismissal and that seeing another colleague being rehired served as an irritant to him. However, while I accept that redundancy was a terrible blow for the complainant, I find that he was fairly selected for redundancy and did not appeal the decision.

It is of note that the respondent was open to the concept of re-hiring the complainant in appropriate circumstances.

3 Reasonableness

Section 6(7) of The Unfair Dismissals Act, 1977 allows me to examine the circumstances of the conduct of the employer in relation to the dismissal in this case

Section 6 (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 adjudication officer or the Labour 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, and

( b ) to the extent (if any) of the compliance or failure to comply by the employer, in relation to the employee, with the procedure referred to in Section 14(1) of this Act or with the provisions of any code of practice referred to in paragraph (d) (inserted by the Unfair Dismissals (Amendment) Act, 1993) of Section 7(2) of this Act.

In Sheehan and O Brien Vintners Federation of Ireland UD 787/2008, The EAT held that it was unfair that genuine consideration had not been given to the cost cutting and re-organisation proposal prepared by one of the employee’s .In addition, The Tribunal found that consideration of the employees for a new role was also unreasonable.

It is widely understood that an employer should allow employees at risk of redundancy to be part of a consultative process.

In Redundancy Law Review by Dermot Casserley , IELJ 2010,7(3),68-73, suggests that a reasonable employer should

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

2 Set out in writing the objective selection criteria

3 Apply the selection criteria consistently

4 Consult and explore alternatives to the redundancies

In the instant case, while I could see that the complainant was genuinely surprised to be identified as being selected for redundancy on February 15, I find that he was on notice that his job was only safe until April 2016 and this had been clearly been flagged with him .He did not advance any proposals to influence a counter decision during this time frame.

When I probed the shortness of the “ consultation “ period permitted in this case , the respondent confirmed that he was open to hearing from the complainant as redundancy was a last resort ,but instead , the complainant sought an accelerated access to his termination package and finished the next day without suggesting any alternative course of action .

I appreciate that the consultation period was “unduly narrow” in this case, however, given the complainants length of service and familiarity with the business, I find there was an untapped right of response by the complainant within the life time of the contract. He simply left and submitted a sick note to the respondent. I find that there was sufficient mention of an anticipatory upward surge in business in the notification of the decision to reduce the workforce so as to generate discussion and debate between the parties.

On balance, while I understand that the complainant was very disappointed to lose his job which was followed by an immediate aftermath of illness, I must find that the respondent acted reasonably in conducting the redundancy, which led to the dismissal .Cruise considered.

I find that the claim under the Unfair Dismissals Act cannot succeed.

2 CA-00005196-02 Employment Equality

This claim was deemed withdrawn by WRC on 8 November, 2015 and notified to the parties .

3 CA-00005196-03 Redundancy

This claim was withdrawn by the complainant on the day of hearing .

Patsy Doyle, Adjudicator.

Dated:   15^th May 2017