Complainant

Respondent

Anonymised Parties

A Business Development Manager

A Small Loans Company

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-00022792-001

22/10/2018

Operating under a money lender’s licence granted by the Central Bank of Ireland, the respondent is a subsidiary of a UK company providing small, unsecured, cash loans to borrowers who pay back the loans and interest on a weekly basis. Around 500 self-employed agents are assigned to specific geographic locations whose job it is to set up loans and collect repayments. The complainant joined the company in October 2009 and she was employed as a Development Manager, which is a controlled function under the Central Bank’s Fitness and Probity regime. In this role, she managed a team of agents in her region, she trained in new agents and she carried out the duties of agents who were absent or who had resigned.

Sanctions Checks

As a credit institution, the company is required to comply with the Criminal Justice (Money Laundering and Terrorist Financing) Act 2010. The objective of this legislation is to ensure that loans are not provided to people with criminal or terrorist links. A Financial Sanctions List is maintained by the EU and UN Sanctions Committee and, before approving a loan for a customer, banks and lending institutions are required to check the name of the potential borrower against the names on the Financial Sanctions List. This is known as “due diligence” checking and a failure to carry out these checks could have criminal and regulatory consequences for a credit institution.

Throughout 2017, the company’s processes and systems came under scrutiny by the Central Bank of Ireland. On September 18th 2017, a new risk-management process known as the “Politically Exposed Persons (PEPs) and Sanctions Check” was introduced. For the remainder of this document, I will refer to as this process as the “sanctions check.” This requires the agent processing a loan for a customer to check the new customer against the PEPs and Sanctions list by calling in the customer’s name and other details to a central number in the company’s head office in Bradford. When the customer’s name is phoned in, the agent gets a reference number to indicate that the check has been carried out and that the customer is not on the Financial Sanctions list. This reference number is then written on the loan document.

Chronology of Events

An exceptions report generated in late November 2017 indicated that the complainant, acting as an agent, did not carry out a sanctions check before she issued two new loans on November 16th. On November 28th, the complainant assured her line manager that, before the loans were issued, she made the telephone call in accordance with the sanctions process. On December 8th 2017, the complainant attended an investigation meeting accompanied by her colleague, also a Development Manager. The meeting was chaired by an Area Manager and he was accompanied by the Regional HR Manager.

At the meeting, the complainant said that she made the telephone call to the central office regarding the two loans and that she had simply forgotten to put the call reference numbers on the application forms. She was informed by the investigating manager that their enquiries had revealed that the sanctions call was made five days after the loan was issued, on November 21st 2017.

On the morning of December 14th 2017, the complainant contacted the Risk Partner for the Republic of Ireland business and told him that she thought that her line manager and the office supervisor were colluding to have her removed from her job. The Risk Partner encouraged the complainant to contact her HR Manager and, following a phone call, the complainant wrote to the HR Manager outlining her concerns.   As this note summarises the complainant’s response to the allegation that she failed to carry out a sanctions check on two loans, it is useful to re-produce the contents here. Referring to the investigation meeting on December 8th, the complainant wrote:

“I was invited to that meeting which was titled ‘an investigation,’ however, what transpired was an interrogation. There was extreme hostility in the room towards me and I felt intimidated. As a result, I was not given the sufficient opportunity to defend myself and I can also see from the notes of the meeting …that most of the fraction of what I wanted to say was completely disregarded and omitted from the notes. For example, at the start of the meeting I stated my surprise that it was I that was in that meeting as opposed to (name of) the office supervisor.

“Another example is that it states in the notes as to why there is no evidence on my phone. I did not get the opportunity to highlight the fact that my work phone was broken and had been faulty for some time hence why I have a new work phone.   This can be confirmed with the area manager. I do not feel that a log on a broken phone is in any way relevant.

“Last in the notes it paraphrases that (name of complainant) stated that she felt that she was being singled out and she was aware of other things happening in the office. The issue I have with this summary of what I said is that I specifically said on several occasions that (name of office supervisor) has told and tells and even rings agents and staff that she favours, informing them of missing PEPs and Sanctions and to either ring her back with the numbers and she will write them in, or indeed to come back in and write in the numbers. This point I feel is of extreme relevance in this case. I had brought in just one of many examples that I have of this evidence, which was completely disregarded.

“I feel that my treatment in the meeting and in this case is unjust and unfair.”

At 2.00pm on December 14th, on a phone call from the investigating manager, the complainant was informed that she was suspended from work on full pay pending a disciplinary investigation into her failure to carry out sanctions checks on two loans issued on November 16th 2017.

Whistleblowing Allegation

The respondent’s whistleblowing policy provides that employees may disclose information regarding wrongdoings to an external 24-hour confidential service which, for the purpose of this document, I will refer to as “Safe-talk.” On January 8th 2018, the complainant contacted Safe-talk and made disclosures as follows:

1. Alleged breach of data protection where the area manager instructed agents to use their mobile phones to photograph documents when visiting customers.

2. The office manager instructs the agents to do this if they contact her and this procedure has been common practice for some time.

3. The office manager shows leniency to agents regarding sanctions checks. She permits the agents to put the reference number on application forms after the loan is approved.

4. Customer accounts are not recorded as closed when loans are paid off. This is to give the impression that there are more live customers in the system than there actually is.

5.    The complainant claimed that when she attempted to report these matters, she was informed that they were a HR issue. She reported her concerns to the HR Manager, but got no reply.

A disciplinary meeting had been scheduled for January 19th, but the complainant’s solicitor contacted the company and he requested that the disciplinary process be suspended until the complainant’s whistleblowing allegations were investigated. The respondent agreed and an enquiry into the Safe-talk allegations commenced.

In relation to the allegation that agents were taking photographs of customers’ documents, the respondent said that they were aware that this had been taking place in the past, but there was no evidence that it was current practice. As a precaution, Development Managers were instructed to speak to agents about the practice and to inform them that they would have their agent’s agreement terminated if any breach was identified.   The company found no evidence to substantiate any of the remaining allegations made by the complainant.

On March 10th and 11th, the complainant contacted Safe-talk indicating that she was unhappy with the outcome of the investigation. This prompted a second review by the company’s Head of Compliance. This review concluded that there was some evidence that agents were not carrying out sanctions checks prior to loans being issued, but he found no evidence that the problem “was systemic or that it was endorsed by the field administration team.” The company dealt with the issues though the exceptions reporting process and, on March 29th 2018, the complainant was informed of these findings.  

A disciplinary hearing was held on April 26th 2018 and the complainant attended with her solicitor. The meeting was chaired by an Area Manager, “AM,” who was accompanied by a HR Manager.   Two loans had been highlighted by the company’s exceptions process where it was apparent that sanctions checks were not carried out before the loans were issued. The complainant said that she issued only one of these loans and that the other one was issued by an agent she was training. AM pointed out that it was the responsibility of the complainant to train the new agent in the correct procedures.   Regarding the call to carry out the sanctions checks, the complainant said that she couldn’t remember when she made the call, and she said that if she had made it after the loan was issued, it was done in error.

The complainant said that she felt that she was being singled out for doing something that she claimed everyone else was doing. She named the office supervisor as one of the transgressors, but this person doesn’t approve loans. As part of her whistleblowing allegation, the complainant reported that the office supervisor had allowed agents to obtain sanctions check reference numbers after loans were issued, and this was investigated. The office supervisor was interviewed and there was no evidence to indicate that what the complainant alleged had occurred.   If it had occurred, this fact would have been identified on the exceptions report.

Another reason the complainant said that she was singled out was because the two exceptions that she was involved in were treated as a disciplinary issue. However, the respondent’s case is that the breach of the sanctions process came to light as part of the exceptions process. At the time they were reported to the Risk Department, it was not known that the complainant issued the loans.

Having considered all the evidence, AM concluded that there was a significant breach of trust by the complainant. She was required to act in a responsible manner, but AM found that she had not acted honestly or ethically. Apart from the actual breach of process, AM found that the complainant’s behaviour following the discovery of the breach meant that she could no longer be trusted.   She was responsible for training agents in regulatory compliance including sanctions checking. She was also required to speak with agents who had not complied with the process. AM was not confident that the complainant would train agents to be fully compliant or have the necessary conversation with them when she herself had failed to carry out the proper process and then had tried to cover it up. In her role in the company, the complainant was in a “controlled function” under the Central Bank’s fitness and probity regime which meant that she must be competent, capable, honest and ethical and that she must lead by example.

AM concluded that the complainant’s actions amounted to a significant breach of trust which brought into question her integrity, honesty and ethical commitment to the company. On May 11th, the complainant was dismissed and, although she appealed against this decision, on July 28th 2018, the decision to terminate her employment was upheld.

Claiming that her dismissal was unfair, on the form she submitted to the WRC, the complainant said, “I did not do anything out of the ordinary in that office and most certainly nothing to warrant a disciplinary sanction of any description.”

Evidence of the Area Manager, “AM”

In response to questions from Ms Guinness, AM said that she manages three Development Managers, who in turn have about 20 agents reporting to them. Her area provides loans to about 3,000 customers. She said that the role of the Development Manager is to manage the self-employed agents and to build positive relationships with other employees. Development Managers are required to have a high level of integrity and compliance, to lead by example and to guide the agents.

AM described the PEPs and sanctions process as “not complex,” simply requiring a telephone call to the UK for a new customer or a returning customer. If the lead is central, the sanctions number is generated centrally.

AM said that she was requested to carry out a disciplinary meeting by the manager who conducted the initial investigation into the exceptions report. A copy of the notes of the disciplinary meeting on April 26th 2018 was submitted in evidence at the hearing and this records the issues raised by the complainant and her solicitor and the points raised in mitigation of her actions.

At the meeting, the complainant suggested that, in November 2017, when she issued the two loans in question, she shouldn’t have been working on these loans because an agent hadn’t been appointed. AM said that regardless of whether an agent had been appointed, the complainant submitted loan approval forms to the office without reference numbers to indicate that the customers had been checked for sanctions. After the loans were issued, she telephoned the central office to do the sanctions checks and to get the reference numbers for both loans.

At the investigation meeting on December 8th 2017, the complainant had been adamant that she made the sanctions phone call before she approved the loans, but, at the disciplinary meeting in April, she said that she couldn’t remember when she made the call, and, if she phoned after the loans were issued, she claimed this was due to human error. The complainant said that if she knew when she made the call, she would have stated this. AM said that the complainant had several opportunities to say that she made an error, that she forgot to follow the process or that she didn’t make the call when she should have. However, at the investigation meeting, she was adamant that she made the telephone call to check the sanctions list, and now, she was saying that she couldn’t remember.

The complainant alleged that she was being singled out for doing something that others were also doing.   AM told the complainant that there was no evidence to support this.

AM said that there were two parts to the sanctions check; the first is that the check is carried out by making the call to the Bradford office and the second part is that the reference number is written on the application form. Failing to put the number on the form is not a breach of the sanctions process, because the check has been completed; however, failing to carry out the check itself is a breach.

At the meeting, the complainant alleged that the office supervisor was permitting agents to put reference numbers on loan application forms after the loans had been approved.   AM said that the office supervisor has no role in the loan application or approval process.

Asked by Ms Guinness why she decided to dismiss the complainant, AM said that she took account of the fact that the complainant had been an employee for nine years.   She said that a breakdown in the relationship with the complainant occurred when she told lies about having completed the sanctions checks, and then said that she couldn’t remember and then tried to implicate others in the same failing. AM said that she felt that the complainant could no longer be trusted. Ms Guinness asked about the whistleblowing report submitted by the complainant on December 14th 2018. AM said that if the complainant had concerns about what was going on in the company, these concerns should have been raised by the complainant before she was suspended.

AM referred to the company’s disciplinary procedure which, under the heading of “Summary Dismissal” is listed “any act detrimental to the company’s reputation” and “flagrant disregard of fundamental Company procedures (e.g. security procedures).” AM said that the complainant’s actions demonstrated a disregard for the actual process of sanctions checking.

Cross Examining of the Area Manager, “AM”

In cross-examining by Mr Block, AM said that no formal regulatory training is required for Development Managers, but that training is provided on an online learning management system, known as “LMS.” Development Managers are trained in what is termed “the one best way” process for checking for risks of money-laundering. An agent’s manual is available to the agents via their agent’s application (APP). The company ensures that the agents have completed their compliance training by checking that thy have down-loaded the APP.

Responding to Mr Block, AM agreed that errors occur in the processing of loans. In the week in question, around November 16th 2017, she said that the exceptions system registered 36 errors. AM said that at the investigation meeting, the complainant had an opportunity to say that she made an error, but she said that she phoned in the borrower’s names, which she did not do until the loans were issued. She said that she was singled out for making an error, but AM said that she appeared to have a disregard for the sanctions checking process.

AM said that the reason that the complainant was dismissed was not because of an error or a breach of the process, but because she was not honest about what happened. Mr Block questioned how AM could arrive at this conclusion about a person who had been employed for a long time and who was apparently good at her job. AM said that following the disciplinary meeting, she reached the conclusion that the complainant “lacked honesty.”

Referring to one of the two loans in question, Mr Block said that the agent who was responsible for this loan completed his training on November 8th 2017, so the complainant was not accountable for the process that was followed regarding this loan. Mr Block said that it appears that there was a delay between November 8th and 16th assigning this agent to the loan. He said that the complainant will say that she requested this agent to be signed off on the lending system before the loan in question was issued. AM said if the agent didn’t carry out the sanctions check, then he was not properly trained by the complainant.  

AM said that on November 28th 2017, the complainant was adamant that the sanctions check calls had been made before the loans were issued. Then she said that the calls may not have been made until afterwards, and that she couldn’t remember and that she may have made an error.

Mr Block asked why the complainant couldn’t have been given the benefit of the doubt and if a lesser sanction would have been more appropriate. AM said that, having looked at the disciplinary procedure, she decided that the wording, “flagrant disregard of company procedures,” properly described what had occurred and that this was categorised as summary dismissal. AM said that while the complainant gives the impression that the only mistake she made was not writing a number on a loan document, this was not the reason she was dismissed. AM said that the complainant was dismissed because she was adamant that she made the sanctions check call before the loan was approved, and this was not true.   She tried to minimise the mistake and disregarded the main point of the sanctions checking procedure.

At the conclusion of AM’s evidence, Ms Guinness asked her about the list of responsibilities in the complainant’s contract, one of which is to step into a vacant agency.   Ms Guinness asked why the complainant was carrying out the sanctions check, if the new agent was fully trained on November 16th? AM said that she assumed that the agent had not been trained in the sanctions checking process and that he had not completed his training.

AM said that the issuing of loans is not a day-to-day element of the complainant’s job and, for this reason, she found it strange that she couldn’t remember when she made the sanctions check call.

Evidence of the Regional Manager, “RM”

On the second day of the hearing, RM described the sanctions process and the call that must be made to the company’s head office before each loan is issued. He said that an agent might occasionally forget to make a call, and, if this occurs, they are counselled, generally by a person in the same role as the complainant, a Development Manager. The agents are not employees of the company, so the disciplinary process does not apply to them.

DM heard the complainant’s appeal against her dismissal and he decided that the termination of her employment should be upheld.

Cross-examining of the Regional Manager, “RM”

In cross-examining, RM agreed with AM’s description of the sanctions checking process as not complicated. He said that the company implemented the checks very strictly, as they were required to do by the Central Bank. He accepted that mistakes do occur. If an agent made a mistake, they would be spoken to and the importance of the procedure would be stressed. Mr Block asked why the agents are not dismissed if they make a mistake, since the checks are so important? RM said that a person can make an error. He said that the complainant was not dismissed because she made an error, but because she did not admit that the made she sanctions checking calls after the loans were issued.

RM said that, like the Area Manager who dismissed the complainant, he thought about a lesser sanction. He said that if the complainant had admitted that she made the call after the loan was issued, a warning may have been appropriate. If she had said, “I never rang the PEPs and sanction number,” she probably would not have been dismissed, but because she was adamant that she made the call, there was a problem of deceit. He said that the complainant knowingly tried to deceive the investigating manager and the manager who ultimately dismissed her. For someone with almost nine years’ experience, the complainant would have known the importance of the sanctions process. If she had been honest with the investigating manager, the disciplinary investigation might have ended there or there could have been a different sanction.

Evidence of the Divisional HR Manager, “DHR”

From a HR perspective, DHR described the company’s approach to breaches of the PEPs and sanctions process. She said that, because the sanctions checks are a requirement of the Central Bank of Ireland, a breach is always investigated. Evidence was submitted of investigations in February, March and April 2018, where the HR team investigated failures to carry out sanctions checks. Of the three investigations carried out, none resulted in a disciplinary sanction.   DHR said that each person involved accepted responsibility for not carrying out the check, and one of these flagged the error himself before the exceptions report was issued.

Cross-examining of the Divisional HR Manager, “DHR”

In cross-examining, DHR repeated the company’s position that the process for carrying out sanctions checks is not complicated and that it was simple and she said that the training for employees and agents was, in her view, sufficient.

DHR agreed with Mr Block that the complainant contacted her about how the investigation meeting that was carried out on November 28th 2017 was conducted. She said that she asked AM to consider if this complaint had merit.

Summary of the Respondent’s Position

It is the respondent’s case that the complainant was dismissed because of a breach of trust arising from her inconsistent accounts of what occurred when she failed to carry out mandatory checks before issuing loans. Ms Guinness said that the company considered a lesser sanction, but decided that the breach of trust was so significant that dismissal was the only reasonable outcome. Ms Guinness said that the company took all reasonable steps to investigate the protected disclosure allegations submitted by the complainant on December 14th 2018 and it is entirely denied that she suffered any detriment for raising protected disclosures.

Evidence of the Complainant

In her direct evidence, the complainant described her role, which she said was performance-based with targets related to sales, loan collections and customer renewals.   She said that she consistently delivered on these targets and she received awards for going the extra mile.   She was acknowledged for her work with the gift of a trip on the Orient Express and an overnight in the   K Club.

A few years ago, the complainant said that she submitted a grievance against a manager which was upheld, and he was asked to resign. In March 2017, she said that she made a complaint about another colleague and he left the company. She described the atmosphere in the office as “toxic” and she said that she was subjected to “severe intimidation.”

Addressing the issue of the PEPs and sanctions checks that lenders were required to carry out, the complainant said that the only training she got on this process this was in an email. She said that the understood the purpose of the checks, which was to screen all new customers or customers who were renewing loans to ensure that they were not on a list of terrorists or money-launderers.

The complainant said that it is not her job to issue loans. When the two loan applications came in that resulted in her dismissal, she was filling in for agents. She said that she only issued one of these loans. She said that both customers had been with the company for years and they had just paid off loans and had submitted new applications.

At the time the loans were issued, the complainant said that she was working six days a week, covering for two agents. She said that business was “manic” and she couldn’t take holidays. During the investigation into the two loans, she was asked what day she made the call to do the sanctions check, but she said that she couldn’t remember. When the call log was produced which showed that she made the call after the loans were issued, she said that she must have made an error. She said that other people made similar mistakes and that the office supervisor told them to make the calls and she filled in the reference numbers.

In response to her counsel, the complainant said that she thought that there was a grace period until January 1st 2018 for complying with the sanctions check process.   She heard that there was a new APP being introduced around that time. She said that most loans are issued on Saturdays and that the sanctions phone line doesn’t open on Saturdays and that there is no facility to call after 7.00pm on any day. In her view, she said that compliance isn’t important to the company, and that what counts is figures, customer accounts and money.

Asked about the disciplinary process, the complainant said that she was called to a meeting on December 8th with an Area Manager, a HR Manager and one of her colleagues. She claims that the meeting was more of an interrogation and that the Area Manager shouted at her and wouldn’t let her speak. She said that she made a complaint about him a couple of days later. At the meeting, she said that she told the Area Manager that she couldn’t remember what day she made the calls to check the loans against the sanction list. She said that she wasn’t able to say what she wanted to say.

The complainant produced a copy of the letter issued to her by her manager on December 14th. This confirms the company’s decision to suspend her with no change to her terms and conditions and on full pay, pending the outcome of an investigation into the following allegations of gross misconduct:

“Disregard of PEP and Sanctions Regulatory Requirements as laid out in the Criminal Justice (Money Laundering and Terrorist Financing) Act 2010.

“Significant inconsistencies which have arisen with respect to the details of the sequence of events which you have provided.”

During her direct evidence, the complainant said that, following the meeting on December 8th, she contacted the Divisional HR Manager about the following matters:

§  A grievance about the conduct of the Area Manager at the investigation meeting on December 8th.

§  A grievance about the phone call on December 14th when the complainant was informed that she was suspended.

§  Breaches of policies and procedures in the office – the whistleblowing allegations referred to in the previous section.

These matters are ancillary to the investigation into the complainant’s failure to carry out the sanctions checks on the two loans issued on November 16th 2017, and I am satisfied that they have no impact on the outcome. However, in her evidence, the complainant referred to one particularly relevant finding from the review of the disclosures she made to Safe-talk on January 8th 2018. The complainant had alleged that agents failed to obtain PEPs and sanctions numbers before loans were issued. The outcome of the investigation into this matter was sent to the complainant on March 29th 2018 when she was informed that:

“In relation to your allegation at point 4 of your disclosure alleging that agents failed to obtain PEP and Sanction numbers prior to the loan being issued, the additional review by Senior Management has found evidence to suggest that, in some cases, agents fail to get a PEP and Sanction check completed prior to issue. This is currently a manual process which can lead to individual errors and is in the process of being amended to stop any kind of circumvention.   There has been no evidence to suggest that this issue is systemic or endorsed by the Field Management team.   There is no evidence to suggest that the administration team allow agents to add the reference numbers post issue. Further action will be taken to remind agents of their obligation to complete these checks pre-issue.”

Following the investigation into the complainant’s whistleblowing allegations, a disciplinary meeting was held on April 26th 2018. The complainant said that she didn’t agree that the minutes of the April 26th meeting accurately recorded what she said at the meeting and she sent three emails objecting to the minutes. One of the points she objected to was the reference to her issuing two loans, when in fact, she issued just one loan. Regarding the first loan, the complainant said that one of the loans was meant to be under a new agent’s name, and that she had asked her manager to allocate a float limit to the agent, but that this wasn’t done. She also asked the office supervisor to allocate a float limit, but she did not do so. A customer was looking for a loan at lunchtime and her manager did not respond to the request for a float until late in the afternoon. Regarding the second loan, the complainant said that this was issued by a new agent.

The complainant reiterated her view that it was common practice to issue loans and to get the sanction checks numbers afterwards.

The complainant objected to AM’s finding that there were inconsistencies between what she said at the investigation meeting, to the effect that she made the sanctions call before the loans were issued and her statement at the disciplinary meeting, when she said that she couldn’t remember when she made the call. At the disciplinary meeting, the complainant said she told AM, “if you have a call log, I must have made a human error.”

On May 11th, the complainant received a letter from AM in which she was dismissed.   Although she appealed against this decision on May 21st, her dismissal was upheld.

Concluding her direct evidence, the complainant said that after she raised a grievance about a colleague in March 2017, her line manager’s attitude to her changed, as did the attitude of other men in the company. She said that for months, she had worked for six days a week, as she had been sent out to do collections for another development manager.

Cross-examining of the Complainant

In response to cross-examining by counsel for the respondent, Ms Guinness, the complainant agreed that she had never raised a concern or an objection to working six days a week.

She agreed that, before loans are issued, customers have to be checked against the sanctions list.   On November 28th, when she was asked by her manager if she had made the calls about the loans that were issued on November 16th, Ms Guinness said that she was adamant that she made the calls, but the complainant disagreed with the term, “adamant.” She agreed with Ms Guinness that she said that she may have forgotten to put the reference numbers on the forms.

When she was asked by Ms Guinness what additional training could have been provided about the sanctions process, the complainant said that she should have been told that she could be dismissed if she didn’t carry out the checks. However, Ms Guinness replied that the complainant was not dismissed for not carrying out the checks, but because she didn’t own up to not carrying them out.

The complainant said that she couldn’t explain why there was no record on her phone of a sanctions call being made before November 16th, when the loans were issued.

Ms Guinness referred to the minutes of the disciplinary meeting which record that the complainant said, “the only error she made was forgetting to write the reference numbers down.” In response, the complainant said that the minutes are not correct. Ms Guinness referred to a point in the notes where the complainant is given an opportunity to say that she made an error. AM asked her, “as she was so busy at the time, if she had made a human error and forgot to make the call before the issue.”   The complainant repeated that the minutes are not correct.

Ms Guinness asked the complainant why, if she had been truthful, the investigation proceeded to a disciplinary hearing? Ms Guinness suggested that the complainant could have instructed her solicitor to inform the management that she had made an error. The complainant said again that the minutes are not correct and that she told AM at the meeting on December 8th that she made a mistake. Ms Guinness referred to two pages of notes attached to the minutes of the meeting which record the complainant’s comments on the minutes. The complainant replied, “our changes are not included.”

Asked about her perception that there was a grace period until January 1st 2018 to implement the checks, the complainant said that she was told about this by her Area Manager. Ms Guinness said that the company’s position is that the checks were a requirement of the Central Bank and that there was no period of grace after which they must be implemented.

At the end of her evidence, Ms Guinness asked the complainant what efforts she has made to find another job since her dismissal. She replied that the last time she applied for a job was on August 5th 2018. In November 2018, she said that she went to see a counsellor and was advised to go on illness benefit. On the date of the hearing on February 25th 2019, the complainant remained in receipt of illness benefit from the Department of Social Protection. Ms Guinness therefore submitted that the complainant’s maximum loss of earnings is from the last day on which she was paid by the company on May 31st until August 5th 2018.

Summary of the Complainant’s Position

It is the complainant’s case that the process that led to her dismissal was very confrontational from the start. She feels that her dismissal coincided with complaints she made about the company’s processes and that this influenced the outcome. Her position is that the conclusion of the investigation should have resulted in a sanction other than dismissal. She claims that from the start, she said that she couldn’t remember when she made the call to carry out the sanctions checks on the two loans issued on November 16th 2017. She said that she has no problem admitting that she made a mistake, and that, as a person of integrity, she feels that she has been betrayed by the company.

The Legal Framework

Section 6(1) of the Unfair Dismissals Act 1977 provides that:

“Subject to the provisions of this section, the dismissal of an employee shall be deemed, for the purposes of this Act, to be an unfair dismissal, unless, having regard to all the circumstances, there were substantial grounds justifying the dismissal.”

The burden of proof rests with the respondent to establish the substantial grounds justifying the dismissal of the complainant in this case. Section 6(4)(b) of the 1977 Act provides that;

“…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 …the conduct of the employee.”

The Reason the Complainant was Dismissed

A copy of the respondent’s PEPs and Sanctions Policy shows that, with effect from Monday, September 18th 2017, “agents will need to call the Company’s Contact Centre to do a ‘PEPs and Sanctions’ Check for all agent generated leads (New Doors and New Business) and Paid Up renewals.”

In a detailed and clear policy document, specific instructions are provided for agents, Development Managers, Area Managers and Regional Managers regarding the checks to be carried out and the reasons why. There is no provision for a grace period or a lead-in period beyond September 18th 2017.

On November 16th 2017, the complainant was involved in the processing of two loans.   For one of these, she acted in the place of an agent, and for the second loan, she worked with a newly-appointed agent, who issued the loan. The investigation into the processing of these loans revealed that the sanctions checks were carried out on November 21st 2017, six days after the loans were issued.  

The dismissal letter issued to the complainant on May 11th 2018 states:

“The reason for your dismissal is:

“A breach of trust in respect to the significant inconsistencies which arose with regard to the details of the sequence of events which you provided in relation to your failure to comply with the PEPs and sanctions process.”

The inconsistencies are set out in the letter as follows:

§  At the disciplinary meeting, the complainant said that she issued only one loan on November 16th 2017; however, she made a telephone call to carry out a sanctions check on two loans.

§  The sanctions call was made on November 21st, six days after the loans were issued.

§  On November 28th, in response to her line manager, the complainant said that she made the calls before the loans were issued.

§  At the disciplinary meeting on December 6th, the complainant was given “many opportunities” to explain what occurred regarding the timing of the sanctions checks and she was asked if she had made a “human error” and forgotten to make the call before the loans were issued. She responded that this was not the case and she said that she always followed the proper process and that the only error that occurred was that she failed to write the reference numbers on the loan documents.

§  At the disciplinary meeting on April 26th, faced with the inconsistencies in her statements, the complainant said that “human errors can be made.”

It is clear from this that the complainant was dismissed because of the responses she gave during the investigation into a breach of a regulatory process. From the evidence of the respondent at the hearing, it seems that she may not have been dismissed for failing to comply with the process. The respondent produced evidence about three employees investigated in early 2018 who were not dismissed when they forgot to carry out sanctions checks.   However, because she was dishonest in response to questions about what occurred, the investigating manager reached a conclusion that the complainant was not trustworthy, and this is the reason she was dismissed.

It is not my role to adjudicate on the credibility or otherwise of the complainant’s explanation regarding the breach of the regulatory process or, as set out in Looney & Co. Ltd v Looney, UD 843, 1984, “to seek to establish the guilt or innocence of the claimant.”   Having considered the evidence of the parties, my task is to consider if the decision to dismiss the complainant was reasonable and, in reaching this decision, was the process which resulted in the dismissal a fair process?

The Company’s Approach to Breaches

As a Development Manager, the complainant had responsibility for managing a group of lending agents in a business regulated by the Central Bank of Ireland. Her role is considered by the respondent to be a controlled function under the Central Bank’s Fitness and Probity Standards.   In accordance with these standards, a person in a controlled function must demonstrate that they are fit (competent and capable) and proper (honest, ethical and capable of acting with integrity) as well as being financially sound in their own right. The letter confirming the complainant’s dismissal is clear regarding the investigating manager’s conclusion that the complainant did not conduct herself with honesty and integrity in response to the investigation into the sanctions breaches that occurred in November 2017.

Was the Decision to Dismiss Reasonable?

Having considered this matter, it is my view that it was reasonable for the investigating manager to reach a conclusion that the complainant’s conduct caused a breach of trust between her and her employer. During the process to investigate the breaches, when faced with the evidence that she did not carry out the sanctions checks before the loans were issued, the complainant was offered an opportunity to own up. As a senior employee with eight years’ service, I am absolutely satisfied that the breach of the process would not have caused her to be dismissed. Unfortunately, she did not tell the truth, and, in my view, she made matters worse by seeking to apportion blame on a newly trained agent and on an office supervisor who she falsely portrayed as a key player in a contrived allegation about the failure of others to adhere to proper procedures.

I have listened to the evidence of the complainant and I have considered her position regarding the reasons why she thinks she was dismissed. Early on, she alleged that she was singled out for an investigation into a breach of the sanctions process, but I am satisfied that the system that identified the breach did not, in the initial stages, reveal who was responsible. She then suggested that there was a plan by her line manager and the office supervisor to have her removed from the company, but she submitted no evidence to support this contention.

The circumstances of this case are somewhat unusual, because what started out as a disciplinary investigation into a relatively simple technical breach of a regulatory procedure evolved into an examination of the complainant’s honesty and truthfulness. The complainant brought this predicament on herself, when she declined the opportunity to align her explanation about what happened concerning the breach of the procedure, with the available evidence. The outcome from the investigation was that her employer concluded that she could not be trusted to act honestly and with integrity.

In her role as a manager of lending agents, the complainant was required to guide others in their adherence to the company’s procedures. She had to lead by example, but her conduct throughout the investigation and at the hearing of this complaint demonstrated an antagonism towards her employer that appears to have affected her from even before the disciplinary investigation began. Clearly, trust had broken down on both sides.

I am mindful of the gravity of the effect of dismissal on the complainant. I am also mindful of the gravity of the effect of her responses during the disciplinary investigation. Her failure to tell the truth caused her employer to question her ability to act honestly. I have considered the possibility that a lesser sanction might have been appropriate; however, I find that the conclusion reached by the employer was reasonable in these circumstances.

Was the Process Fair?

Despite the complainant’s claim that the investigation that led to her dismissal was unfair, I am satisfied that the respondent acted in accordance with its own disciplinary procedure, which is a reasonable and fair procedure and in line with the requirements of Statutory Instrument 146 of 2000, the Code of Practice on Grievance and Disciplinary Procedures. I find also that the respondent’s decision to postpone the disciplinary investigation to carry out an investigation into the complainant’s whistleblowing allegations was unsparing from the point of view that the complainant remained out of work on full pay for several weeks longer than the time taken to complete the disciplinary investigation. The decision to dismiss the complainant was therefore taken without haste. At all times, the complainant was represented, she had the benefit of legal advice and she had the opportunity to appeal against the respondent’s decision to dismiss her. I am satisfied therefore, that the procedure followed by the respondent that resulted in the complainant’s dismissal, was a fair procedure.

Having considered all the evidence, verbal and written, and having taken account of the legal framework regarding the dismissal of an employee due to misconduct, I have decided that from a substantive and a procedural perspective, the decision to dismiss was not unfair and I find against the complainant.

Dismissal, breach of trust,