Complainant

Respondent

Anonymised Parties

Accounts Manager

Catering Wholesaler

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-00025122-001

18/01/2019

The Complainant was employed by the Respondent from 14th February 2006 until 19th July 2018 when her job was made redundant. The Complainant claims that her redundancy was not genuine.

The Respondent submits as follows:

The Respondent strongly disputes the Complainant’s claim that she was unfairly dismissed.   The Respondent submits that the Complainant was fairly dismissed due to redundancy.

Background to the Respondent

The Respondent is a long-established catering wholesaler company. Since May 2016 the Respondent has embarked on a period of rapid growth and expansion of the business through mergers and acquisitions.

The Board of Directors undertook a rolling review of the human resources, personnel levels, growing needs and complexities and role duplication with the business. The output of the review identified that 25 positions in the business needed to be made redundant in order to put the business on a sustainable footing. The redundancy number of 25 also reflected areas of the business where there was role duplication. Redundancies were agreed and implemented between April 2017 and July 2018.

In particular reference to this claim, the review identified the Respondent accounts and finance departments as having role duplication and an operating model that was not fulfilling the needs of the business. There were three Accounts Managers each doing the same job in different parts of the business — it was identified that the business needed one Financial Controller, and as such two of the Accounts managers positions were identified as 'at risk'. Additionally, it was identified that the group accounts function be centralised with a Finance Director leading the function. The business created a role specification for the newly restructured finance management positions of Financial Controller and Finance Director. Both of these positions would require people with senior accountancy qualifications as well as industry experience at these management levels. The business then examined the fit between the qualifications and experience of the three existing Accounts Managers and the restructured roles. Two of the three incumbents (DE and the Complainant) were identified as not meeting the qualification level or experience for the new positions. (DE’s position was also made redundant.)

In January 2018, the Respondent   appointed an external consultant as the Respondent’s outsourced Finance Director. All management of the Respondent were informed of this appointment at a meeting held in the Board Room on 27th January 2018.

The Finance Director formally circulated an email on 18th April 2018 which included an outline of everyone's role within the accounts department under the new structure. Everybody in the accounts department, except the Complainant, availed of the opportunity to query some items within and then accepted and fully embraced the new model. Also, prior to the Financial Controller preparing and completing the new model, the Complainant was consulted and asked to contribute from the outset.

Background to the Redundancy

The Complainant throughout her time with the Respondent showed a flare for, and an interest for in-house IT systems and became the first point of contact for IT maintenance and systems both in-house and liaising with external contractors. Due to the continued growth of the Respondent, a new role was identified for an inhouse IT CRM role in April 2018. Due to the Complainant’s interest and knowledge of internal systems she was given first refusal of this role and rejected the offer on the basis of no further increase on her current salary at the time and no company car.

The Complainant was verbally informed by the CEO on 30th May 2018 that the role of Accounts Manager was potentially 'at risk' and due to the CEO's annual leave he would follow up with her immediately on his return. The Complainant was requested to take that time to come forward with suggestions to avoid a redundancy. A letter was issued to the Complainant on 11th June 2018 informing her that the role was 'at risk'.

The Complainant was informed in this letter that consultations would take place to discuss alternatives whereby the Complainant’s employment could be protected and in order to identify possible ways in which the redundancy could be avoided. The Complainant was also informed that the Respondent would review and identify whether there were any alternative positions vacant within the Respondent organisation that may be suitable to her. The Complainant was also asked to forward alternative proposals and suggestions in preparation of the 'job at risk' meeting with the aim to avoid a redundancy.

At the ‘job at risk’ meeting on 14th June 2018, the Respondent explained to the Complainant why the Respondent decided that it is necessary to make redundancies and why the Accounts Manager position was at risk and provisionally selected for redundancy.   The Respondent also explained the terms on which any redundancy would take place and the possibilities for applying for the alternative role of Night Shift Office Administrator. At the adjudication hearing, the CEO stated that he did not offer the Complainant the IT CRM role which had previously been offered as the Respondent could not afford to pay what the Complainant had sought in the past. The Complainant was also invited to bring forward any ideas/suggestions to avoid redundancy. No suggestions or ideas were brought forward by the Complainant.

The Complainant informed the Respondent by email on 14th June 2018 that the Night Shift Office Administrator was unsuitable and that she would not be accepting the offer.

A follow-up consultation 'job at risk' meeting was held on 15th June 2018.

The Complainant was again asked if she had any ideas/suggestions to avoid a redundancy and she informed the CEO that she believed the redundancy was not genuine and therefore had no ideas or suggestions. In response the CEO informed the Complainant as to why the position was required to be made redundant and said that they had hoped that they could find an alternatively suitable position in order to ultimately avoid dismissal. The CEO again asked the Complainant for any suggestions she might have for an alternative role but she did not put forward any roles.

Following this meeting, the CEO informed the Complainant that there would be no more further consultations and informed the Complainant that she would be issued with a formal redundancy dismissal in writing and advised the Complainant that she could appeal, details would be set out in the letter and will take effect from Monday 18th June 2018

The Complainant was issued with formal notice of dismissal due to redundancy on 15th June 2018 detailing her notice of six weeks entitlement, outstanding holiday entitlement, statutory redundancy schedule, payment date 22nd June 2018 and her right to appeal.

The Complainant sought to appeal her redundancy.

The Respondent appointed a wholly independent and unconnected professional to hear the appeal to allow maximum independence to the process.

The Independent Appeals Officer wrote to the Complainant on 25th June 2018 informing her of her appeal hearing date of 27th June 2018. The Complainant terminated her appeal hearing within ten minutes on 27th June 2018. The Complainant gave two reasons why she terminated the appeal hearing without contributing: (i) there was no representative from the Respondent and (ii) she understood that both parties should present their cases simultaneously in the same room and at the same time.

The Complainant’s reconvened appeal hearing was heard on 6th July 2018. The Complainant raised a number of issues at the appeal hearing. After the hearing, the Independent Appeals Officer interviewed the CEO on 6th July 2018 in order to seek further clarity.

After careful consideration of the appeal and all the facts surrounding the redundancy, the Independent Appeals Officer upheld the earlier decision and the appeal failed.

Conclusion

The Respondent strongly argues that the Complainant was not unfairly dismissed. A programme of redundancies that dealt with 25 positions was implemented in order to save approximately 80 jobs. Unfortunately, the Complainant held one of the roles that was made redundant and, despite the Respondent offering two alternative positions, the Complainant did not accept either. The redundancy programme to date has completed 25 redundancies and only the Complainant has challenged the validity of her redundancy.

The Respondent did not isolate the Complainant within her role, she was not alone in the process. It was not the Complainant the Respondent   had made redundant, it was the role of Accounts Manager that was fairly selected for redundancy.

During the process the Respondent continuously tried to accommodate the Complainant with alternative solutions requesting her to also engage with her own ideas and solutions. The Complainant did not at any stage bring any solutions to the consultations.

The Complainant makes reference to receiving a verbal warning and the Respondent believes it was fair.

The context of the verbal warning was that, further to a call from the Respondent’s bank to the group CEO, relating to a serious discrepancy with the Respondent’s invoice discounting function. The CEO called the Finance Director and the Complainant into his office to explain the situation. Both the Finance Director and the Complainant were questioned equally by the CEO and both were asked to explain their respective understanding of how such a serious breach had taken place. The Complainant had communicated information over the telephone to the bank representative which was totally at odds with how the Complainant had outlined the situation to the Finance Director.   This caused huge operational and reputational damage to the Respondent with their bankers. The Complainant agreed and duly accepted the verbal warning. The verbal warning in question had no connection whatsoever with the role of Accounts Manager being at risk of redundancy.

The company strongly argues that the Complainant was not dismissed unfairly.

The Complainant joined the Respondent company in 2006 and enjoyed her career with the Respondent until 2018.

In February 2017, the Complainant’s rate of remuneration was increased and the CEO set out a career path within the Respondent organisation, which the Complainant believed would lead to the appointment of the Complainant as the Financial Controller, with further improved terms and a company car. To achieve the outlined career path, it was requested that the Complainant enrol in an accounting technician course to advance her skills. In furtherance of the outlined career path, the Complainant enrolled on such a course.

Matters continued to go well for the Complainant in her employment and on 19th June 2017, she received a letter from the CEO commending her for going the extra mile with regard to the integration of new businesses.

The Complainant was not unaware that restructuring of roles within the finance function was required and on her own initiative she discussed matters with the CEO and another member of management in September 2017. An outline structure was drawn up showing the Complainant at the head of a team of people and her job description is described as "Accounts Manager/IT”.   The Complainant was the go to person within the Respondent organisation for the resolution of all IT problems and matters. The Complainant had a hybrid job description encompassing both accounts and IT.

In January 2018 the Complainant was subject to annual appraisal. The Complainant outlined all of the issues she had been having with lack of clarity in relation to reporting structures, workload, etc. Also she referenced the discussion she had with the CEO in January 2018 regarding the promise of the Financial Controller position, the company car and the increased package mentioning the agreed time line of 9 months to a year was coming to an end. She also fully explained what she had achieved to date and plans for the future development of the finance and IT roles.

In April 2018 the newly appointed Finance Director continued the process of redefining roles within the finance function and in his e-mail of 18th April 2018 confirmed that the Complainant's role was central to the finance function. This was simply a reworking and reconfirmation of the structure and roles agreed prior to Christmas 2017.

In April 2018 a proposal was made to the Complainant that she leave her Accounts Manager/IT position and take up a new position within the Respondent as IT CRM Manager. The Complainant declined the proposal for a number of reasons :

·         The proposal did not involve an improvement in terms.

·         The Complainant was happy where she was.

·         There was no suggestion that her current roles were in jeopardy.

·         The Complainant was on a career path towards the position of Financial Controller and was undertaking a course of night study towards that end.

At the time of making this proposal, there was no hint of redundancy and all the indication were that the Complainant was a valued member of the finance function team. Furthermore, when the redundancy was mentioned, this role was not suggested by the Respondent as an alternative position.

On 26th April 2018 an issue arose with the Respondent's bankers in relation to the invoice discounting service that was being availed of. A disciplinary investigation was suddenly initiated against the Complainant which was entirely unwarranted and without foundation. Notwithstanding this the Respondent saw fit to administer a verbal warning to the Complainant which was unjustified and appeared to the Complainant to be a thinly veiled attempt on the part of the Respondent to undermine the Complainant in her position. In this the Respondent succeeded as the Complainant felt that the Respondent was suddenly pursuing an agenda which was designed to see her removed from the Respondent company.

On 30th May 2018 the Complainant was suddenly advised by the Respondent that the Respondent was going to have to make redundancies and that her position was at risk. This was extremely traumatic for the Complainant, given her length of service with the Respondent and her enjoyment of her job. It was incomprehensible to her that, from being a highly regarded employee who was central to the plans of the Respondent, she was suddenly surplus to requirements in a very short space of time.   It seemed to her that suddenly the Respondent was determined to secure the termination of her employment. The, as she saw it, bogus disciplinary process fitted in to a pattern of fault finding, which she found disconcerting.

The termination of employment duly came to pass: after a series of meetings and an appeal, the Complainant was made redundant and received her P45 in July 2018.

The Complainant has had a serious lack of confidence resulting from the events leading up to her redundancy. She did not feel able to return to an office environment, despite having looked for a similar role. The Complainant was employed as a part time counter assistant from 29th November 2018 where she remained until she found a new job in which she is currently still employed as a part time Barista in a local Coffee Shop.

The Complainant still feels traumatised by the treatment received in the Respondent in her last 6 months with the Respondent and finds it very unfortunate that it came to the conclusion it did. She really enjoyed her first 12 years with the company and is disappointed to have been let go in such a manner.

The Complainant's IT role in the company was not made redundant and this of itself, it is submitted, confirms that this was unfair dismissal in the guise of redundancy.

Relevant legislation

Section 6(4) of the Unfair Dismissals Act, 1977 provides as follows:

(4) Without prejudice to the generality of subsection (1) of this section, the dismissal of an employee shall be deemed, for the purposes of this Act, not to be an unfair dismissal, if it results wholly or mainly from one or more of the following:

(a) the capability, competence or qualifications of the employee for performing work of the kind which he was employed by the employer to do,

(b) the conduct of the employee,

(c) the redundancy of the employee, and

(d) the employee being unable to work or continue to work in the position which he held without contravention (by him or by his employer) of a duty or restriction imposed by or under any statute or instrument made under statute.

The matter for me to decide, therefore, is whether a genuine redundancy situation existed in relation to the Complainant’s dismissal. In making my decision in this case, I must take account of the reasonableness or otherwise of the behaviour of the Respondent in relation to the redundancy.

I accept, on balance, that the Respondent’s trading position was such that it had a need to reduceemployee numbers. I also accept that the Respondent engaged in a consultation and information process with the Complainant which commenced on 30th May 2018.  

It is well settled that when contemplating redundancies, there is an obligation on an employer to look for an alternative to redundancy.

I note that Item 15 of the Respondent’s redundancy fair procedures checklist in relation to the Complainant poses the following question: “have all (the Respondent’s emphasis) alternative roles being advised to the employee to consider at the consultation meetings (even if the alternatives do not appear suitable on the face of it)?” The Respondent had ticked the box to indicate that this item had been completed.

I am of the view that both parties agreed that the Complainant’s role prior to her redundancy comprised of both a finance and IT element.

It appears to me that the focus of the Respondent’s dealings with the Complainant prior to her redundancy focussed entirely on the finance element of her role which was being made redundant and that no cognisance was taken of the IT element of her role which was not being made redundant.

It is not disputed that the Complainant was offered an alternative IT CRM role in April 2018 which she refused.

Following the initial notification that her position was at risk of redundancy on 30th May 2018, the Respondent did not re-offer the IT CRM role to the Complainant. At the hearing, the CEO explained that the reason for not re-offering the IT CRM role was because they could not afford the reward package which the Complainant sought when the role was offered to her previously.

In Paisley v McCormack Dental Ltd UD1257/2002, the EAT held that an employee must be aware that they are being considered for redundancy when offered alternative employment. In that case, the Complainant refused the offer of an alternative position prior to being informed that his position was at risk of redundancy. The EAT held that:

“The Respondent acted unreasonably in that the Appellant was not told that he was being considered for redundancy until late in the day, a fact that might have coloured his attitude to the earlier job offer and his negotiation of terms and that the earlier job offer was not made again once it became clear that its refusal was leading to redundancy.”

I am of the view that the Complainant was not aware when she was offered the IT CRM position that her job was in danger of being made redundant. If she had been, she may well have accepted the alternative position.

Having considered the submissions of both parties and the evidence adduced at the hearing of this complaint, I am of the view that the Respondent behaved unreasonably when they did not re-offer the position of IT CRM Manager to the Complainant after she was informed that her job was at risk of redundancy. I find therefore that this complaint is well founded.

Redress

The Complainant submitted that due to the manner in which her employment with the Respondent was terminated, she did not feel confident enough to return to work in an office environment. Instead, she has worked in a number of part-time roles in the service sector.     At the hearing, the Complainant quantified her losses to date at €24,500.

The Respondent submits that the Complainant was paid statutory redundancy of €15,552.

I find that this complaint is well founded and I direct the Respondent to pay the Complainant redress of €10,000 which is payable in addition to her statutory redundancy.

I find that this complaint is well founded and I require the Respondent to pay the Complaint redress of €10,000 in addition to her redundancy payment.

Unfair dismissal – not genuine redundancy