Complainant

Respondent

Anonymised Parties

A Manager

A Printing Company

Representatives

Smith & Williamson, Accountants

Act

Complaint/Dispute Reference No.

Date of Receipt

Complaint seeking adjudication by the Workplace Relations Commission under Section 39 of the Redundancy Payments Act, 1967

CA-00023993-013

04/12/2018

Complaint seeking adjudication by the Workplace Relations Commission under Section 39 of the Redundancy Payments Act, 1967

CA-00023993-014

04/12/2018

Complaint seeking adjudication by the Workplace Relations Commission under Section 39 of the Redundancy Payments Act, 1967

CA-00023993-015

04/12/2018

There were three complaints; one related to not having received any redundancy payment (23993-013), one to having received an incorrect payment (23993-014), and finally to not having received a statement from the respondent of its inability to make a redundancy payment (23993-015.)

The complainant confirmed at the hearing that he wished to pursue only the first of these.

The complainant says while he had been with the company for some years prior to the date identified for this hearing (to 1952 in fact) he can establish that he has been registered as an employee of the company since April 1980 (on the K1 rate of social insurance) and was on the A1 rate from the following year, 1981.

He moved on to the ‘J’ rate on reaching his sixty fifth birthday.

The original company was acquired by a new owner in April 2015 and the complainant and a number of other named employees transferred under the Transfer on Undertakings Regulations. All of the complainant’s statutory rights transferred to the new entity and the complainant submitted evidence of correspondence in which his continuing role in the company after the transfer was outlined.

In due course, the new entity experienced trading difficulties and became insolvent and went into liquidation in 2015.

A Receiver was appointed in October 2017.

Regarding the complainant’s status as an employee evidence was submitted of his contributions’ regime since 1979/1980 continuing up to 2017. This was only secured from the Department of Employment Affairs and Social Protection on January 28th 2019.

Regarding the division of his salary between his wife and himself he says that he instructed the Financial Controller to terminate this practice, but it was not done.

The respondent was represented by the receiver.

The receiver had prepared the necessary redundancy forms for the complainant, but he would not sign them as he disputed the basis on which the calculation was made and the starting date of the employment.

The Receiver made every effort to establish the correct basis for calculation the complainant’s entitlement to redundancy but was hampered by a lack of records, partly arising from a software malfunction in the company. Evidence was given of its attempts to do so.

It was also not evident to the Receiver that a TUPE had taken place in 2015 and it had not been possible to get a copy of the complainant’s contract.

Further, in the last year in which payments were made to the complainant the due amount (€634.62) was split between him and his wife for tax reasons, and therefore his salary for that last year was €372.72 per week.

In any event the respondent told the complainant at a meeting on October 19th 2018 that it could not sign off on claim forms which contained disputed amounts of for which there was insufficient back-up information

The first question to be addressed is whether the complainant-maintained continuity of employment when the company was acquired in 2015.

At the time of the acquisition of the company, in April 2015, the new owner wrote to the complainant outlining a list of the transferring employees ‘we intend to employ’.

On a list of eight, four had already been employed at the date of writing the letter and four more were to be employed in the following two weeks.

The provision regarding the complainant was that he was to be appointed as a ‘consultant’ to the new entity and detail was provided on his ‘fees’, and how they were to be paid.

This was to be on the basis of a fixed quarterly payment of €8333.25 per quarter, and details of his role were to be ’clarified within the next week’. There was a requirement that engagement with ‘key artisan suppliers’ would happen ‘with the assistance of’ the complainant.

It is hard to see any basis on which this disrupted the continuity of the complainant’s employment, even noting some change in the role.

There was a suggestion in correspondence which was not the subject of direct evidence that the new entity merely bought the customer list from the liquidator and took on several employees under new contracts to assist with the additional business.

But this is not supported by the correspondence referred to above in which four employees apparently transferred immediately, four more were due to do so in fairly short order and the complainant was given a contract also to continue in employment.

The intention of the parties, or the appearance of what happened is not relevant here. It is well established that employees’ transfer takes place as a matter of law and I find that a transfer did take place.

Any change in the complainant’s job role negotiated by him to take effect after the transfer may, depending on the timing be dicing with the strict requirements of the transfer regulations which require that he transfer on the same basis as he had been on previously.

But that is not at issue in this complaint and in any event it does not disrupt his continuity of employment for the purposes of redundancy calculation.

Accordingly, I find that his service was not broken by the 2015 changes.

Next then is the question as to when his service runs from for the purpose of the redundancy calculation.

The evidence submitted from the DEA&SP was as follows. This appears in correspondence to the complainant on January 28th 2019 from the Client Eligibility Services of the DEASP and must stand as the definitive statement of the complainant’s record as an insured person.

In 1979/80 he has 52K rate contributions. In the following two years he had 52 K1 and 47 A1 contributions.

In 1982/3 he had 42 ‘credited’ contributions and 1983/4 the number of contributions is not recorded.

Thereafter, in every year between 1985/5 and 1994/5 he had 52 K1 contributions. He moved on to the A1 rate in 1995 and the A rate between 1996/7 and 2001. In all of these years he had 52 contributions (except 2001 when it was 38).

He then moved on to the M rate on which he remained until the redundancy,

In summary this shows the complainant as having been an insured worker since April 1979 on the K rate and April 1980 on the K1 rate and his service for the purpose of a redundancy payment must also run from the first of these dates.

I find he is entitled to a redundancy payment on this basis.

Next is the question of the rate of pay on which this should be calculated.

The terms of the complainant’s contract of employment are clear and as set out above viz; that he would receive a fixed quarterly payment of €8333.25 per quarter. This would entitle him to the maximum statutory weekly payment of €600.00.

It appears that an arrangement was entered into on foot of which half the payment was made to himself and half to his wife. He sought to have this reversed at the time but did not succeed.

The submission from the respondent (receiver) at the hearing stated that he did not have sufficient backup to support the terms of the contract as set out above and only had the contemporaneous records of the ‘split’ payment. He had been willing to certify a claim on that basis.

Nonetheless, while the ‘split’ arrangement was unorthodox, to put it mildly and may give rise to other consequences, in view of my finding on the Transfer of Undertakings above I also find that the complainant is entitled to have the calculation based on the terms of his actual contract of employment as agreed in April 2015 and which have not been rebutted.

Accordingly, his complaint succeeds.

Based on the evidence before me I am satisfied that the complainant was in employment initially from April 6th, 1979 and that at a date in April 2015 his employment transferred under the European Communities (Protection of Employees on Transfer of Undertakings) Regulations, 2003, to the respondent company.   I find that his employment terminated on October 23rd, 2017 by reason of redundancy.

I find therefore that the complaint under the Redundancy Payments Acts, 1967 – 2012 is well-founded and that the complainant is entitled to a redundancy payment based on the following criteria:

Date of Commencement:       April 6th, 1979

Date of Termination:              October 23rd 2017

Gross Weekly Pay:                 €634.62

This award is made subject to the complainant having been in insurable employment under the Social Welfare Acts during the relevant period, as evidenced in the DEASP Client Eligibility Services letter of January 28th 2019 referred to in the Findings and Conclusions.

Redundancy