Complainant

Respondent

Anonymised Parties

A Senior Programme Manager

A Software Company

Representatives

C McGrady BL instructed by Hennessy & Perrozzi Solicitors

A McFadden Solicitor IBEC

Act

Complaint/Dispute Reference No.

Date of Receipt

Complaint seeking adjudication by the Workplace Relations Commission under Section 8 of the Unfair Dismissals Act, 1977

CA-00014879-001

09/10/2017

This case concerns the alleged Unfair Dismissal /Redundancy of a Senior Programme Manager from a Software Company.

The Complainant maintained that he had been unfairly selected for Redundancy because of his age and high salary. He was denied all fair procedures and was not given adequate time to consider his position. Meetings were perfunctory and often no more than conference calls. No efforts were made to provide full information reading the reasons behind his selection.

As a preliminary matter, he was required to sign a Waiver and Release Form purporting to preclude him from bringing a case under the Unfair Dismissals Act,1977. This Waiver form had been signed under considerable duress, without any proper legal advice and was therefore not a valid document.

The Complainant commenced employment in February 2014 as a Senior Programme Manager. This was standalone position in Ireland. In June 2017, he attended a meeting with Ms. Xa , HR Business Partner for Ireland and via telephone Ms.PH, Senior Programme Manager based in the US. The Complainant was informed that the Respondent was restructuring globally and that his duties would hence forth be supported via the US Offices. He was accordingly at risk of Redundancy. He was informed that he would be part of a consultation exercise to see if alternative work could be found for him.

Inquiries regarding details of Redundancy were made with HR on the 15th June and a first Consultation meeting was held on the 21st June 2017. At this meeting the situation was discussed in detail and the Complainant was given a further opportunity to put forward suggestions of alternatives. None were forthcoming from the Complainant.

A further meeting was scheduled but as Ms. Xb had herself been made redundant in the US the meeting was delayed until the 7th July 2017. At this meeting, it was clear that no alternatives to Redundancy were possible and a Redundancy package was offered on condition of his signing a Waiver and Release form. (henceforth abbreviated as the W&R form) The Waiver and Release form had a deadline of the 14th July 2017. It was advised to the Complainant that he should take all necessary advice prior to signing the W&R.

The W&R form was returned by hand on the 12th July 2017 and the Redundancy package was paid.

The Respondent maintained strongly that the Redundancy was a globally initiated Cost cutting exercise, had nothing to do with the Complainant’s age and he was treated properly in keeping with fair procedures. Representation was offered at all stages and advice was given to the Complainant to secure independent Legal or other independent advice prior to signing the W & A form.

Suitable alternatives were researched but unfortunately the Complainant had a stand-alone role in Ireland and no alternatives could be found. Other employees were made Redundant globally at the same time.

As the Complainant had a unique role no formal selection matrix process was possible. All processes were fair and reasonable.

Several legal precedents were quoted in support of the Respondents’ position.

3:1    The basic Legal Principles

There is a considerable volume of academic legal writing and established EAT and Higher court precedents covering redundancy and unfair dismissal in the approximate situations that exist in this case.

At Section 22-30 page 786 of Employment Law in Ireland: Cox, Corbett and Ryan, Clarus Press 2009 the key issues are summarised as

“a number of imperatives stand out: objectivity, fairness, consultation, and the contemplation of alternative solutions to redundancy”

In addition, interesting legal precedents are quoted in Employment Law by Donovan: Round Hall 2016 where the point is made that a genuine redundancy can be deemed unfair where flawed procedures are adopted.

In summary, therefore, a Redundancy situation must be seen to be scrupulously and objectively fair and the employee being made redundant fully consulted with all alternative options carefully considered.

The emphasis on fairness has a resonance for the preliminary point in this case -the Waiver and Release form.

3:2    Consideration of the evidence in the case in hand.

3:2:1     General Observations & the Preliminary Point.

Before considering the Preliminary Point regarding the W &R form it is necessary to have a look at the case in the overall. All the legal precedents indicate that there is no universal rule in the waiver context, but all cases must be seen on their own terms. In this regard, I have decided to let the case proceed to consider all the evidence.

My specific reasoning on the W &R point is in the body of the text below.

While the Complainant was employed in the Irish jurisdiction it was clear to me that all the effective decision making in this case emanated from the United States, the parent location of the Company.

The key meeting of the 14th June 2017 (minutes presented in evidence) where the process was initiated was dominated by Ms.PH a Senior Programme Manger by Teleconference from the US. The Irish HR representative, while participating, was left it seemed to me to handle the details. It was clear that the decision to make the Complainant Redundant had been already made and to relocate his work to the United States. Although contested and not in any written minutes the Complainant strongly maintained that the United States based executive had stated that “It was a layoff” and for the Complainant to “move on”.

The rationale offered was the transfer of the handling of a key customer account to a number of executives in the United States was, in my view, plausible from a business point of view. The relocation of work from one part of a business to another is legitimate.

To that extent, a genuine Redundancy existed. Section 6 (4)(c) of the Unfair Dismissals Act,1977 refers.

What was at issue in my view was the manner in which the Complainant was dealt with. The stated principles identified above by Cox et al above of fairness, objectivity, consultation and proper consideration of alternatives must apply.

The Complainant and the Irish based HR Partner gave evidence. The United States Executive Ms. PH was herself made redundant during the period – apparently without any great personal notice to herself. This made the effective holding of consultation meetings difficult. Various e mails were exchanged during this period, but these appeared largely to focus on the details of the financial package on offer, timings etc. The Complainant did seek to consult with some fellow colleagues regarding other work but to no avail. Some 16 other employees, both Irish based and overseas were being made Redundant at the time and other work opportunities were sparse. It was clear that the Complainant was effectively swimming against the waterfall in any efforts at realistic consultation regarding his redundancy or alternatives that might apply. It was an irony that the United States executive dealing with the case, was herself, by report at the hearing, also unexpectedly to herself made Redundant during the process.

Suggestions of sourcing alternative roles for the Complainant either in Ireland or overseas did not appear to have found success and by the 7th July the Respondent informed the Complainant that the Consultation period was now effectively over. The W & R form and the final letter of termination was now presented to the Complainant.

The Irish HR Partner made it plain in her evidence that her liberty to improve the terms on offer was extremely limited and would need US based approval which was most unlikely to be forthcoming as the severance package was a global strategy.

The letter of the 7th July which accompanying the W & R form has clearly highlighted in bold type the statement

“If you choose not to sign the Waiver and Release, you will not receive the ex gratia payment or accelerated equity vesting”

Waiver and Release Preliminary Point; In the context of the Complainant this was clearly placing him under severe duress. Accordingly, I take the view that the Adjudicator has the jurisdiction to proceed with entire case, W & R form notwithstanding.

The question of legal advice or legal counsel as stated in the form was considered at the hearing. The Complainant stated that after consultation with his wife he had decide not to seek legal advice. The Complainant was a Senior Programme Manager and his decisions have to bear personal responsibility. If he chooses, despite being advised to, not to seek legal counsel, it is to his account.

The next issue is one of Reasonableness. The Legal precedents clearly indicate that the former EAT or latterly Adjudicator cannot seek to impose their own view on an Employment related matter but rather to have regard to what is Reasonable in the circumstances and to have regard to what similar type employers might decide.

In this regard the ex gratia Lump sum of €13,510 for an Employee with an Annual Salary of €119,790 appears to be significantly off the norm for an Irish based situation. The Respondent HR Partner indicated that the figure had been dictated from the United States.

The question of the Complainant’s age did not appear to have been an issue and there was no evidence to support any contentions that he was in some way unfairly selected on age grounds.

3:3     Initial Conclusions

The Redundancy situation was genuine.

The W&R Form had an overtone of Duress such as to allow the Adjudicator to set it aside and consider the entire case.

The initial steps taken by the Respondent were correct but efforts at Consultation and consideration of Alternatives were at best limited. This was a serious procedural flaw in the Respondent’s case.

The Complainant was advised of the possibility of obtaining Legal counsel but on his own admission choose not to do so. This was a major weakness in the Complainant’s case.

The final ex gratia amount offered was not in keeping with what would be accepted in an Irish context as “Reasonable”.

Age discrimination did not appear to be supported by any evidence.

3:4   Final Conclusion

While a genuine Redundancy existed, it was handled in an Unfair manner (largely in the latter stages). The final amount of the ex gratia was not what would be considered to be within the “Band of Reasonableness” by most Irish Employers.

Accordingly, a finding of Unfair Dismissal must be made in the Complainant’s favour.

3:5     Redress.

The Complainant’s efforts at mitigating his loss following the Redundancy were contested by the Parties. A supplemental submission on this point was received from the Respondents’ representatives post the Hearing. The point was made forcibly that the Complainant was in the IT and Software Industry and his lack of success in securing alternative work, even on a causal Day rate Contractor basis needed further explanation. The Sector is one where, it is generally accepted, a lot of short term work is done on a day contract basis often by employees seeking permanent positions.

The issue of re instatement or reengagement was considered at the hearing and deemed inappropriate.

Section 7(1) (c) of the Unfair Dismissals Act,1977 provides that the Adjudicator shall consider what is “just and equitable having regard to all the circumstances”.

Accordingly, having decided that an Unfair Dismissal took place, on largely procedural grounds, I award a figure of financial compensation.

In determining the amount of this award I had regard to the initially correct procedures of the Respondent, the fact that a genuine Redundancy existed, the short service of the Complainant, (less than four years) , his disputed lack of success in securing alternative work in his industrial sector, his decision not to seek Legal or independent advice at the crucial July stage and what would generally be recognised as “reasonable compensation”   in Redundancies of this nature in this Industrial Sector.

Bearing all the above in mind I make an award of six months’ basic pay (€9,982 x6 = €59,892 say € 60,000) to the Complainant but reduced by the Ex Gratia and Statutory Redundancy already received (€13,510 plus €4,758) and by a further factor of half a month (€5,000) in recognition that he clearly decided not to seek Legal or other specialist advice at the crucial stage.

Accordingly, the final lump sum is €60,000 less (€ 13,510 + € 4758 +€ 5,000) giving a final award of € 36,732.

The taxation of this amount to be a matter for consultation with the Revenue Commissioners.

Act

Complaint/Dispute Reference No.

Summary Decision /Refer to Section 3 above for detailed reasoning.

Complaint seeking adjudication by the Workplace Relations Commission under Section 8 of the Unfair Dismissals Act, 1977

CA-00014879-001

The claim for Unfair Dismissal is upheld. Compensation in the amount of

€ 36,732 is awarded.