Complainant

Respondent

Anonymised Parties

A sales representative

A tourism company

Act

Complaint Reference No.

Date of Receipt

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

CA-00022793-001

22/10/2018

Complaint seeking adjudication by the Workplace Relations Commission under section 7 of the Terms of Employment (Information) Act, 1994

CA-00022793-002

22/10/2018

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

CA-00022794-001

22/10/2018

Complaint seeking adjudication by the Workplace Relations Commission under section 7 of the Terms of Employment (Information) Act, 1994

CA-00022794-002

22/10/2018

The complainant resigned from his employment because the respondent did not reimburse him for monies he paid out on the respondent’s behalf; the respondent denies the claims.

The complainant worked for the respondent between June 2015 and August 2018. He managed the sale of tickets for the respondent’s services through hotels and other tourist sites.

The complainant outlined that a practice developed in 2017 where he paid the commission due to agents when this money was not forthcoming from the respondent. In July 2017, the respondent had stopped paying out for commissions due. The hotels were asking to be paid their commission and the complainant did not want to lose business. It was imperative to pay commission to hotel and tourist office staff. The complainant initially paid the commission due to agents from his own money and later from cash receipts. He did this with the respondent’s permission. The respondent assured the complainant that he would be repaid, and this was “money in the bank”. He raised this issue by email in December 2017, which refers to their “previous conversations”. He emailed the respondent, saying he needed the money, for example 7th March and 29th April 2018.

The complainant maintained a diary to record the transactions and they were initialled by the hotels. The record showed that he was owed €1,100. The respondent had agreed to discuss the outstanding commission money at the August 2018 meeting. Despite the earlier assurance he would be paid, the respondent later told the complainant he was unlikely to receive payment. The complainant said that he was devastated at this loss. He no longer trusted the respondent who had gone against previous undertakings. He decided to resign as the monies were never paid to him

The complainant said that he submitted a weekly book of sales to the respondent, which was reconciled. Tickets sold by drivers would be reconciled at the end of each day. When the ticket machine on a bus no longer worked, the driver would use the tickets normally sold in hotels; however, these books were not signed out. There were no procedures relating to the sale of tickets on buses from books rather than the machine. This change occurred after the seasonal resumption of city tours in April/May.

The complainant submitted that he was constructively dismissal following a breach of mutual trust and confidence in the employment relationship. He relied on the case of Berber v Dunnes Stores. This breach arose from the non-payment of monies due to the complainant, which the respondent had undertaken to pay. In respect of the Terms of Employment claim, the complainant outlined that this related to a change to the terms of his employment, i.e. the non-payment of commission.

The complainant outlined that he found alternative employment during the notice period and started a part-time role at the beginning of September. He was paid €250 less per week in this role and started another role in December at around €650 per week.

The tourist office manager

The tourist office manager outlined that he operated a tourist office in the city centre. He had booked trips with the respondent through the complainant. He invoiced the respondent when he had sold a book of tickets. The tourist office manager employed the complainant to work afternoons between September and December 2018, i.e. to staff the office when he was away. In questioning, the tourist office manager accepted that there had been a discrepancy in a bill, for which he has not been paid. It was put to the tourist office manager that there were discrepancies in sales of €10,000; he disputed that there were discrepancies and commented that the lines of communication with the respondent were better when the complainant worked there.

The driver witness

The driver witness said that he had been employed as a driver with the respondent until January 2018. There were no procedures in 2017 regarding managing ticket books. He would be handed six or seven books of tickets but did not sign for them. He returned the sold books to the complainant or another member of staff. The books were kept in the office, without security. He said that when the machine on a bus broke, they used ticket books usually sold in hotels. After selling tickets, they handed over the cash but were never asked for the counterfoils.

The driver witness said that there was no control of the tickets. There was also no record of complimentary tickets issued. The complainant told the driver witness in 2017 that he had to pay commission out of his own pocket. The driver witness was aware that the complainant was spending his own money on behalf of the respondent. The driver witness had raised the issue of accessing the car park of a named tourist site as he had to pay for this himself from cash receipts. This was also what the complainant did.

The hotel witness

The hotel witness outlined that the complainant paid him commission in cash from his own money when he brought new books. The hotel witness said that he was now owed commission from the respondent for both hop on, hop off tickets and for excursions to named tourist sites.

In closing, the complainant said that he was owed €1,100 and the respondent had acknowledged this. He paid out the commission to ensure the respondent kept business. The respondent had assured him he would be paid. He had explained to his line manager on the 13th August why he was resigning, i.e. the commission issue. The respondent had not contacted him during the notice period.

The respondent outlined that it operated two brands, one where tickets were bought through hotels for the hop on, hop off service and a second where excursions were booked through a representative and the concierge receives commission. The respondent provided the complainant with books to distribute to hotels, which were collected when the tickets were sold. The complainant would record which books were collected. It might take three months for a small guesthouse to sell a book.

The respondent kept a master list of books allocated to sales representatives or drivers. They recorded which hotels were provided a book and when this was collected. By year end 2017, there was €4,000 outstanding. The respondent reviewed the process in June 2018 and identified that there was a discrepancy between tickets issued and cash received. There was a time lag because the books were issued before the start of the main tourist season, but this had not caught up by the 2nd August. It submitted that the respondent master sheet is correct and recorded all books distributed, including to drivers. It said that there was €10,000 that it would never be able to recover.

The respondent said that the complainant had raised the commission issue on the 2nd August. The respondent manager was away until the 13th August and sought to reply on his return. This, however, was the day the complainant resigned. He did so at 6.24am. The manager witness did not deny that another manager had referred to the commission money being “money in the bank” for the complainant. He outlined that the contract of employment provides that receipted expenses would be paid.

The respondent said that on the 2nd August, it began a review and there was no accusation against the complainant. The respondent said that the complainant was agitated at the meeting. This escalated to the complainant handing in his notice without giving the employer the opportunity to respond. The complainant did not give a reason in the email of the 13th August. He raised the commission issue again on the 29th August. It submitted that the complainant breached the 12-month restriction in the contract of employment by selling competitor tickets in September.

In questioning, the respondent said that there was no express instruction for the complainant to pay out commissions from his own money. The complainant had not said on the 21st December 2017 that the monies owed to him were for commission. His email of the 29th April 2018 was the first time this issue was raised directly. It was put to the respondent manager that the complainant raised this every month; he replied that they had already sought the August meeting before the complainant’s July email. He said that the issue of the commission and the monies owed to the respondent were separate, but the complainant has linked them in his claim of constructive dismissal. He said that the complainant had resigned before the manager could come back to him. He commented that the commission issue had “flared up” when the respondent raised the ticketing issue.

In closing, the respondent outlined that the complainant had not raised the commission issue for several months. It was only raised in the context of housekeeping issues. The issue was raised in the August email, but the complainant had resigned on the manager’s return from annual leave and before he could address it.

On the 22nd October 2018, the complainant submitted two sets of complaints to the Workplace Relations Commission. Each set includes a complaint pursuant to the Unfair Dismissals Act and the Terms of Employment (Information) Act. I have addressed the substance of the complaints in CA-00022793-001 and CA-00022793-002. I have declared that the complaints in CA-00022794-001 and CA-00022794-002 not well founded as they are duplicates.

The complainant’s contract of employment states at 2.6 that the respondent will pay his out of pocket expenses incurred in the performance of his duties on production of receipts and subject to the approval of the Finance Department. The complainant gave a cogent account of managing the distribution and sale of tickets for tourist buses and excursions. The complainant outlined that he had to immediately pay commission to concierges and agents when sales were made. This evidence is backed up by the hotel witness, who works in a prominent hotel.

The respondent acknowledged that the complainant had spent his own money in paying commission on its behalf. The email of the 29th April 2018 states “I’ve been on the phone this weekend and two hotels asked for their commission and one won’t be selling anymore due to the wait as all others take two weeks at the very outside. We can’t cover the commission at this point [the complainant] is out of pocket substantially and has been in touch with [the finance department] regarding same.”

It is clear from the emails that the complainant persistently raised the commission monies owed to him. His email of the 21st December 2017 states “Sorry for getting onto you again but any sign of the commissions?” This is commission money paid in the 2017 tourism year, but the complainant is not reimbursed during 2018. He raises the issue again in further emails, for example 7th March, 13th April and 27th July 2018.

The complainant met with respondent managers on the 2nd August 2018, where the complainant emphasised the issue of the monies owed to him. For its part, the respondent emphasised the reconciliation of ticket books. While this was a prominent issue in 2018, I note that there were also “housekeeping” issues in 2017. The complainant’s email of the 6th August clearly sets out his position, referring to his “countless requests” to be reimbursed and the “huge worry” caused in being owed the money. The complainant resigned on the 13th August, working his notice period up to the 31st August. During the notice period, the complainant collected ticket books as part of the reconciliation work. The respondent did not contact the complainant regarding the outstanding monies due to him.

CA-00022793-001

This is a complaint pursuant to the Unfair Dismissals Act. The complainant resigned on the 13th August and his last day of work was the 31st August. The onus rests with the complainant to prove constructive dismissal.

The classic formulation of the legal test in constructive dismissal cases was set out in Western Excavating (ECC) Ltd v Sharp [1978] IRLR 27. This laid out two separate tests: the ‘contract’ and the ‘reasonableness’ tests. It summarised the ‘contract test’ as: “If the employer is guilty of conduct which is a significant breach going to the root of the contract of employment, or which shows that the employer no longer intends to be bound by one or more of the essential terms of the contract, then the employee is entitled to treat himself as discharged from any other performance.” It is important to note that the contract test requires repudiation of contract and not merely breach of contract.

In Berber v Dunnes Stores [2009] 20 E.L.R. 61, the Supreme Court stated that mutual trust and confidence is an implied term in every contract of employment. The Court held “There is implied in a contract of employment a mutual obligation that the employer and the employee will not without reasonable and proper cause conduct themselves in a manner likely to destroy or seriously damage the relationship of confidence and trust between them. The term is implied by law and is incident to all contracts of employment unless expressly excluded. The term imposes reciprocal duties on the employer and the employee. In assessing whether there has been a breach by the employer what is significant is the impact of the employer’s behaviour on the employee rather than what the employer intended. Having regard to the mutuality of the obligation the impact of an employee’s behaviour is also relevant. The test is an objective one: if conduct objectively considered is likely to cause serious damage to the relationship between employer and employee a breach of the implied obligation may arise.”

Moreover, the Supreme Court in Berber set out the following approach in assessing whether a contractual term of mutual trust and confidence was repudiated by an employer’s conduct:

“1. The test is objective. 2. The test requires that the conduct of both employer and employee be considered. 3. The conduct of the parties as a whole and the accumulative effect must be looked at. 4. The conduct of the employer complained of must be unreasonable and without proper cause and its effect on the employee must be judged objectively, reasonably and sensibly in order to determine if it is such that the employee cannot be expected to put up with it.”

In Western Excavating (ECC) Ltd v Sharp, the ‘reasonableness test’ provides that the conduct of the employer should be assessed and whether it “conducts himself or his affairs so unreasonably that the employee cannot fairly be expected to put up with it any longer, if so the employee is justified in leaving.” The reasonableness test requires the complainant to have “substantially utilised the grievance procedure to attempt to remedy her complaints” [Conway v Ulster Bank UD474/1981]. The reasonableness test requires an assessment of the employer’s conduct and the extent to which the complainant utilised procedures and raised his concerns.

In assessing whether the complainant has met either test for constructive dismissal, I note that the complainant was owed money for expenses he incurred doing his job. The respondent’s email of the 29th April 2018 is instructive that commissions had to be paid out there and then and the complainant was out of pocket in doing so. It cannot be said that the complainant only raised the commission monies owed to him because the respondent had questioned the number of outstanding books. It is striking that the complainant had raised the commission issue on so many occasions. It is also striking that the monies were owed to him for so long. The respondent’s email of the 29th April does not question that the complainant is owed the money or suggest that he has done anything wrong. I note that the complainant was seeking reimbursement for monies paid out in 2017, while the reconciliation process engaged by the respondent related to books issued in 2018. I note that the respondent did not inform the complainant during the notice period how the commission issue would be resolved and only contacted him after his employment had ended.

Taking these factors together, I find that the respondent breached the term of mutual trust and confidence in how it treated the complainant. It was aware he had to use his own money to pay out commissions and after initially accepting it owed the money, it later sought to address this via a wider reconciliation exercise. Applying the test in Berber to this case, I find that the complainant could not be expected to put up with the conduct of his employer and the respondent repudiated the term of mutual trust and confidence. I find that the complainant has met the test for constructive dismissal.

In assessing redress, I note the complainant’s mitigation in finding alternative employment, albeit initially part-time. I note he commenced full-time employment in December 2018 at a similar rate of pay he received while working for the respondent. I note that the complainant lost important legal protections accrued through service. Taking these factors into account, I award redress of €5,000.

CA-00022793-002

This is a complaint pursuant to the Terms of Employment (Information) Act. The complainant asserts that the respondent failed to notify him of a change in the terms of his employment. I find that this claim is not well founded. I accept that the respondent did not pay the monies due to the complainant per clause 2.6 of the contract. This non-payment is a breach of the contract of employment and does not represent a change in the terms. The respondent has not said that it would no longer pay the complainant expenses incurred during his employment. The respondent’s failure to pay the complainant these monies does not fall within the notification of change provision in section 5 of the Terms of Employment (Information) Act.

CA-00022793-001

For the reasons set out above, I find that the complaint pursuant to the Unfair Dismissals Act is well founded and the respondent shall pay to the complainant redress of €5,000.

CA-00022793-002

I find that the complaint pursuant to the Terms of Employment (Information) Act is not well founded.

CA-00022794-001

For the reasons set out above, I find that the complaint pursuant to the Unfair Dismissals Act is not well founded.

CA-00022794-002

I find that the complaint pursuant to the Terms of Employment (Information) Act is not well founded.

Unfair Dismissals Act / constructive dismissal

Mutual trust and confidence

Berber v Dunnes Stores [2009] 20 E.L.R. 61