PWD1814

The Respondent experienced trading difficulties in 2016 as a result of which it placed the Complainant on a period of lay-off with effect from 6 January 2017.

The Complainant contested the lay off by way of an email to Mr Sean Fitzpatrick dated 9 January 2017. In it he stated “I would comment that there is absolutely no temporary shortage of work from a sales perspective as I endeavour to secure contracts many of which have been months in negotiations and are very close to closing.”

He then proceeded to list a number of projects that were under negotiation that had a total combined value of €11,838,803.

Ms Susan Mallon, Office Manager, responded to that email by letter dated 12 January 2017 on behalf of the Respondent. In it she states “ I write to confirm that the content of our letter issued to you on 6^thJanuary 2017 stands and you will be temporarily laid off in accordance with your Statement of Main Terms of Employment with effect from Friday, 13^thJanuary 2017. This means you should not present yourself for work on Monday, 16^thJanuary 2017.

By way of letter received on 19 January 2017 the Complainant wrote to the Respondent in the following terms “ I wish to invoke the employee Notice of Termination 1 Month Clause in my Contract of Employment with immediate effect.

I am available to work this time period from now however should you prefer that I should not conduct further company business then I would request you to do the following:

• 
  1. Issue my P45 and one month’s salary in line with the contract

  2. Pay a small outstanding expense claim which I have not yer submitted but will do so before the end of this week

  3. Confirm that the company pension contributions are up-to-date and will be paid until the day of termination

  I confirm that all items of comapy property including the mobile phone and sim card have been returned to Gary Corbett in Castlebar and Susan Mallon in Ballinrobe.

  Please advise immediately of your decision about whether or not I should carry out my work duties during the Notice of Termination 1 Month time period.”

“…. Your resignation is accepted. Please not that I would expect you to offer to remain in employment for the period of your notice. During that time you are likely to continue on lay-off for the next couple of weeks. That being the case, we are prepared to waive your contractual obligation to give a month’s notice. You should note that the company is not required to pay a month’s notice in such a case. Should you decide not to leave before the expiry of your notice, you should know that we are in an ever-changing situation and the continuation of your lay-off will be monitored on a weekly basis to determine whether it will be possible to return to work prior to the termination of your employment. Your P45 will be issued on your termination date…….”

By further letter of 31 January the Respondent instructed the Complainant as follows

“Please be advised that during your temporary layoff period we have decided that there are no duties for you to perform in this company. In addition from a health and safety perspective you are deemed to be not on site. Pending the cessation of your lay-off period you should not transact or engage in any business on behalf of the company without first seeking permission in advance from me. Nor should you present yourself onsite without first seeking permission from me for the obvious health and safety reasons.

I expect these instructions to be complied with immediately.”

The Complainant’s P45 records his termination date as 16 February 2017.

The Complainant filed a complaint with the Workplace Relations Commission on 2 August 2017. In it he claimed that the Respondent had contravened section 5 of the Act.

The Adjudication Officer decided that the complaint was not well founded. That decision issued on 18 December 2017.

The Complainant appealed against that decision to this Court on 26 January 2018. The matter came before the Court on 16 March 2018

Complainants Case

The Complainant submits that his contract of employment contains the following provision relating to short time working

If there is a temporary shortage of work for any reason, we will try to maintain your continuity of employment even if this necessitates temporarily placing you on short time or having to lay you off work without pay.”

The Complainant submits that he was laid off because there was a shortage of money in the Company and not a shortage of the type of work for which he was employed. He submits that as sales director his main task was to secure new business for the Company. He submits that he was actively engaged in the process and had brought contracts worth in excess of €11 million to an advanced stage of negotiation. He submits that his lay was not in accordance with the terms set out in his contract of employment.

He submits that he served notice of termination of employment on the respondent in accordance with his contract of employment. He submits that he remained available for work during the notice period and is accordingly entitled to payment in respect of that period.

He submits that he mistakenly recorded one month in the letter of notice when in fact his contract requires two months notice. He submits that despite this mistake he was available to work his contractual notice and he is entitled to payment in respect of the contracted two months.

The Respondent submits that the Complainant was on layoff and was not in receipt of payment for the notice period. It submits that, as it did not have sufficient monies to retain the Complainant in employment, it placed him on layoff in accordance with the terms of his contract of employment. It submits that a proper reading of the relevant clause in the contract of employment envisages a layoff where the responded does not have the financial capacity to provide work for the complainant. It submits that the shortage of work came about through the existence of a shortage of money in the Respondent company.

The Law

Section 5 of the Act states

.—(1) An employer shall not make a deduction from the wages of an employee (or receive any payment from an employee) unless—

(a) the deduction (or payment) is required or authorised to be made by virtue of any statute or any instrument made under statute,

(b) the deduction (or payment) is required or authorised to be made by virtue of a term of the employee's contract of employment included in the contract before, and in force at the time of, the deduction or payment, or

(c) in the case of a deduction, the employee has given his prior consent in writing to it.

Section 5(6) of the Act states

“5(6) Where –
(a) the total amount of any wages that are paid on any occasion by an employer to an employee is less than the total amount of wages that is properly payable by him to the employee on that occasion (after making any deductions there from that fall to be made and are in accordance with this Act) or

(b) none of the wages that are properly payable to an employee by an employer on any occasion (after making any such deductions as aforesaid) are paid to the employee,

then, except insofar as the deficiency or non payment is attributable to an error of computation, the amount of the deficiency or non payment shall be treated as a deduction made by the employer from the wages of the employee on that occasion.”

In Dunnes Stores Cornelscourt Ltd v Lacey & Anor[2005] IEHC 417 Finnegan P stated

In these circumstances I am satisfied that the Employment Appeals Tribunal erred in law in failing to address the question of the remuneration properly payable to the Respondents such a determination being essential to the making by it of a determination.

Accordingly this Court must decide whether the claimed notice is “properly payable” to the Complainant by the Respondent.

The Court has examined the contract of employment and finds that the Respondent confined the circumstances in which it could layoff the Complainant to circumstances in which there was a shortage of work for any reason.

The Complainant submits that this clause must be interpreted against the Complainant should there be any doubt as to its meaning or application in this case.

The Court accepts that proposition.

Applying it in this case the Court interprets the provision to relate to a shortage of work for the Complainant and not for other persons in its employment.

In that regard the Respondent offered no evidence to the Court in support of its contention that there was a shortage of work for the Complainant. Instead it simply asserted that there was a shortage of money in the Company with which it might have paid the Complainant for any work he undertook. It submits that such a shortage of money must amount to a shortage of work.

The Court does not share that view. The terms of the contract of employment are quite confining. They permit layoff where there is a shortage of work and not where there is a shortage of money.

As a shortage of money and not a shortage of work per se is the justification advanced by the Respondent when justifying the layoff the Court must find that the layoff of the complainant contravened his contract of employment.

The Complainant served one month’s notice of termination of employment on the respondent. However he acknowledges that his contract of employment provided for two months’ notice.

The Court was told that the Complainant was in possession of the Contract of employment when he served notice of termination on the respondent. He seeks to suggest however that the notice was based on circumstances where there was some confusion regarding the application of the contract of employment.

However the Court finds that the Complainant cannot seek strict enforcement of the terms of the contract of employment on some issues and not on others. The strict terms can only be relied on in their entirety or not at all.

Accordingly the Court finds that the Complainant served one months notice of termination of his employment on his employer and that the Respondent accepted that one months notice, waived the second month but required him to work out the notice served.

Based on that reasoning the Court finds that pay for that month was properly payable to the Complainant and the Respondent’s failure to do so amounts to an infringement of Section 5 of the Act.

The Court notes that in his complaint to the Workplace Relations Commission and the subsequent decision of the Adjudication Officer, the Complainant made no claim for payment for the entirety of the layoff. Accordingly, no such complaint was before this Court.

Determination

The Court finds that the complaint is well founded. The Court orders the Respondent to pay the Complainant one months pay as claimed by the Complainant.

The decision of the adjudication officer is set aside.

The Court so determines.

Signed on behalf of the Labour Court



Brendan Hayes
21st March 2018______________________
JDDeputy Chairman



NOTE

Enquiries concerning this Determination should be addressed to John Deegan, Court Secretary.