Complainant

Respondent

Anonymised Parties

A former employee

A building supply 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-00029516-001

08/07/2019

The Complainant commenced employment with the Respondent on 7th September 2009 and this employment ended on 17th February 2019.

The Complainant undertook a number of jobs for the Respondent, at the time employment ended the Complainant was the Sales Director.

This complaint was received by the Workplace Relations Commission on 8th July 2019.

A second complaint was received by the Workplace Relations Commission on 2nd September 2019. The second complaint contained complaints under the Payment of Wages Act, 1991 and the Organisation of Working Time Act, 1997. The second complaint was given a file reference of ADJ – 00024026. Both complaints submitted on 2nd September 2019 were settled and therefore withdrawn.

A.      Introduction and General background to the Role

1.       The Complainant began his employment with the Respondent in 2009 and was a loyal, productive and diligent employee from that date until his departure from the company in 2019. The Respondent is a limited company that specialises in the sale of building materials, specifically roofing and cladding. The Complainant was one of the Company’s first employees, he was originally employed as a sales representative.

2.       In December 2013, the Complainant was provided with a 10% Net Profit Share scheme (‘the NPS Scheme’) as reward for his loyal service and hard work. Under the NPS Scheme the Complainant would receive 10% of the company’s net profit from sales. This was intended to incentivise and reward the Complainant in achieving high sales targets.

3.       In December 2014, a competitor of the Respondent approached the Complainant and offered him a job. The Complainant declined the offer and informed the Company’s managing director. At this time the Complainant requested 30% shareholding in further recognition of his continued successful sales performance. The Complainant had been instrumental to the Company’s growth and wished to participate fully in the success to which he had contributed. The Managing Director considered this offer over the Christmas break.

4.       The Managing Director eventually, belatedly responded to the Complainant’s request in July 2015 and offered him a 10% Shareholding in December 2015 and then a further possible 10% to be issued over the period 2016 - 2018. By email dated 2 October 2015, The Managing Director informed all staff of the Complainant’s excellent performance and of his promotion to Sales Director and inclusion on the board of directors.

5.       By email dated 9 January 2016, the Managing Director informed all staff that that Complainant would chair all sales meetings from 14 January as part of his new role as Sales Director. Around this time the Managing Director informed the Complainant that he would meet with him on 11 January 2016 to finalise the shareholding agreement. On 11 January the complainant signed an employee contract for the role of Sales Director but there was no shareholding agreement. By virtue of the promotion, the Complainants duties involved in contrast to his previous role which involved driving around the country as a sales representative.

6.       The Managing Director was continually evasive when questioned about the shareholder agreement during 2016. On 12 November, while out for dinner on a business trip to Italy, the Complainant asked the Managing Director about the shareholder agreement, and the Managing Director responded that it would be arranged in January 2017. The Complainant then inquired as to what the director / shareholder structure would be for the UK expansion. The Managing Director became irate and said, “that is none of your business.”

7.       In the aftermath of the meeting the Managing Director was less willing to share information with the Complainant about the UK business. While the UK Business was set up with money from the Respondent company, this created a cash flow problem with the Respondent. Also, during this time, members of staff complained that they were expected to undertake excessive workloads. The Complainant highlighted this to the Managing Director, but he failed or neglected to do anything to ameliorate staff workload issues.

8.       Again during 2017, when queried by the Complainant about his shareholding the Managing Director was evasive.

9.       On 8 January 2018, the Complainant was not invited to a meeting between the Managing Director, Mr J and Mr E which involved moving some of the business into a separate company in The Managing Director’s name. At this time the Complainant was informed that he would be returning to his previous duties as a sales representative on the road. He was not consulted or given any reason as to why he was being side-lined from his duties as Sales Director. In a sales meeting on 11 January 2018, the Managing Director announced that the Complainant would be “taking a step back” and returning to his previous duties on the road. The Complainant found this humiliating and demoralising.

10.   During this time, the Respondent Company implemented a temporary 20% pay cut for 3 months. The Complainant later discovered that the pay cut had been applied selectively, and not all employees were subject to it.

11.   At the end of July 2018, the Complainant was asked to take over the duties of a recently departed employee, Mr GW. This resulted in a considerable increase in his workload. The complainant was expected to undertake stock control and warehousing duties, provide logistical and administrative support for 3 of the sales staff, while continuing to achieve his own sales targets. The Complainant felt considerable pressure but worked long hours so that he could achieve his onerous targets.

12.   On 26 September 2018, there was a meeting between the Complainant, The Managing Director and a Bank representative in relation to the forward buying of foreign currency. The Complainant was familiar with the process and it was an area of responsibility he was capable of dealing with. During the meeting the Managing Director said to the Bank representative that it was his business and the complainant “had nothing to do with the bank aspect so no point in talking to him.” the Managing Director’s comments created tension and animosity between him and the Complainant. After this time the Complainant was excluded from meetings.

13.   Another sales representative, Mr FM departed on 1 October 2018, putting more pressure on remaining staff.

14.   The Complainant met with the Managing Director on 4 October 2018 to discuss the misgivings he had with the direction the business was going, particularly in light of the departure of staff. During this meeting the Complainant put a proposal to buy out the Managing Director’s shares in the Respondent Company, which the Managing Director said he would consider.

15.   On 16 October the Managing Director said that the timing was incorrect, but he would discuss the matter in December.

16.   The Complainant was on annual leave on 22 and 23 October 2018. When he returned from annual leave on 24 October, he discovered that he had been restricted from administrator rights to the basic computer system. As a result of the IT changes the Complainant was unable to access Profit and Loss Accounts, prices, customer data, statements or produce sales reports. The Managing Director was not present when the Complainant inquired as to why his access had been restricted and the Complainant was informed by another staff member, that the Managing Director had requested he restrict his access.

17.   The Complainant felt devastated by this unexplained exclusion from the core resources that he required to perform his duties as sales director. This demoralising and humiliating treatment left the Complainant unsure as to what his role in the company was. The Complainant had worked tirelessly for the Respondent company and made many personal sacrifices to ensure its continued success over a 9-year period.

18.   On 30 November the Managing Director returned to the Company for the first time since the Complainant’s rights had been restricted. The Managing Director greeted others in the office individually but ignored the Complainant. Shortly thereafter the Complainant received a notification on his computer that the passwords for his work emails had been changed. The Complainant was excluded from sales meetings and not allowed to view the company bank account. The Complainant was also removed from the Company social media accounts, which he had managed since 2015.

19.   During this period the Complainant was ignored by the Managing Director and treated as though he wasn’t working in the Company. Private meetings with accountants and other members of staff took place and the Complainant was excluded from them.

20.   The exclusion and isolation that was inflicted upon the Complainant in the workplace caused him considerable distress and anxiety. Because the Complainant had devoted himself to his work, the removal of responsibilities caused the Complainant to feel worthless and lacking in purpose or direction. The complainant’s mental health deteriorated, something which the Complainant’s doctor has attributed to stress in the workplace.

21.   The Complainant attempted to resolve his grievances through the official grievance procedures. It was not his desire to leave the company which he had served loyally for almost 10 years and he wished to resolve his grievances through the Company’s grievance procedure. The Claimant requested that The Managing Director discuss these matters with him, but these requests were ignored.

22.   Because his complaints were being ignored, the Claimant sought legal advice and instructed solicitors, to correspond on his behalf. On 8 November 2018, his solicitor wrote to the Respondent raising concerns, inter alia, about the Claimant’s deteriorating conditions of employment, exclusion from board meetings and diversion of responsibilities. Further correspondence was exchanged on 14 and 22 November. By reply dated 26 November, the Respondent’s Representatives requested to invoke the provision of the grievance procedure which envisioned the appointment of an external person to investigate the grievance. This request was made on the express basis that the Managing Director would not be the appropriate person to conduct the investigation.

23.   By letter dated 8 December 2018, the Managing Director agreed that it would be inappropriate for him to investigate but complained that appointing an employment agency would be “prohibitively expensive” suggesting that a legal practitioner might be cheaper. The Managing Director failed to propose any proactive steps to resolve the matter. The Claimant’s solicitor replied on 14 December suggesting two firms of independent solicitors, these were rejected by the Managing Director.

24.   On or around 20 December, the Complainant met with the Managing Director. After the meeting the Managing Director took the Complainant aside, used foul language and asked him to drop his grievance complaint because he did not wish to deal with solicitors.

25.   The Claimant’s mental health continued to suffer during the Respondent’s dilatory approach to implementing the grievance procedure. The Claimant had lost faith in his employer’s willingness to address his concerns in a timely manner or at all. The Managing Director had repeatedly prevaricated in response to the Claimant’s requests regarding his share entitlements and he was demonstrating a similar evasiveness regarding the grievance procedure.

26.   Over Christmas 2018, his family members raised concerns about his mental health. Upon his return the Complainant was left with no option but to tender his resignation from the company. He tendered his resignation on 7 January 2019 and agreed to serve out his notice in the interest of training in new staff.

The Complainant’s Unfair Dismissal

Unfair dismissal and constructive dismissal

27.   Section 1 of the Unfair Dismissals act 1977 (as amended) defines dismissal to include:

“(b) the termination by the employee of his contract of employment with his employer, whether prior notice of the termination was or was not given to the employer, in circumstances in which, because of the conduct of the employer, the employee was or would have been entitled, or it was or would have been reasonable for the employee, to terminate the contract of employment without giving prior notice of the termination to the employer,…”

28.   This is commonly referred to as “constructive dismissal.”

29.   In Berber v Dunnes Stores [2009] 20 ELR, although dealing with wrongful dismissal at common law, the Supreme Court held that an employee was entitled to accept the employer’s repudiatory breach of the contract of employment. Finnegan J giving the judgment of the Court, stated as follows:

“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.”

30.   In his judgment Finnegan J cautioned against taking incidents in isolation stating:

“the breach of this implied obligation of trust and confidence may consist of a series of actions on the part of the employer which cumulatively amount to a breach of the term, though each individual incident may not do so.”

31.   Finnegan J went on to set out the following test:

“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.”

32.   Similarly, in the English case of Western Excavating (ECC) Ltd v Sharp (1978) ICR 221, (1978) IRLR 332 Denning LJ stated:

“If an 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 further performance”

33.   Accordingly, it is submitted that the correct approach to be taken by an adjudicator in considering whether there has been a constructive dismissal is: whether there has been a repudiatory breach by the employer, or, if there has not been a repudiatory breach whether the employer engaged in conduct which made it reasonable for the employee to terminate his contract.

34.   It is clear that unilateral demotion of an employee, reduction in their responsibilities or marginalisation/ exclusion can amount to a repudiation of the contract by the employer. For example, in Deegan v Gallagher’s Irish Chocolates [2006] 7 JIEC 1001the EAT considered whether an employee had been constructively dismissed. The employee had worked for the Respondent chocolate shop and, although she had been promoted to the role of supervisor she was later marginalised and removed from her duties and her responsibilities were given to others. The employee had suffered from depression. The Tribunal held that the sales director had constructively dismissed the employee by informing her that she was no longer supervisor and consulting others about matters that would be pertinent to her role.

35.   Similarly, in Brendan Canavan v Kilkenny Scaffolding Services Ltd [2008] 7 JIEC 1601 the employee had previously worked as truck driver for his employer but was promoted to a managerial role in 2008. The Tribunal held that it was not unreasonable for the employee to refuse to return to his previous role. Although the employer had some minor criticisms of his performance, these were not properly brought to the employee’s attention. He was later informed that he must return to his previous role driving trucks. While a certain amount of flexibility is to be afforded to small companies, the employer is required to act fairly.

36.   Accordingly, the was constructively dismissed from his role as Sales Director. The Respondent Company clearly repudiated its contract of employment with the Complainant by excluding him from the ordinary resources and functions that pertained to his role as Sales Director. The Respondent acted unreasonably in its marginalisation of the Complainant and he had no other option but to resign from the company.

The requirement to avail of the grievance procedure

37.   The Claimant accepts that the conduct of both the employer and employee must be considered in assessing whether there was a constructive dismissal. It is clear from Conway v Ulster Bank that it is incumbent on an employee to utilise a grievance procedure and resignation must not be a first resort. Where an employee substantially fails to utilise the grievance procedure they may be considered unreasonable in the context of the employee’s decision to terminate the employment relationship.

38.   It is important to note that the onus on the employee is to act reasonably in availing of the grievance procedure. There are circumstances where it is not unreasonable to discontinue pursuing a grievance. In Allen v Independent Newspapers Limited the Employment Appeals Tribunal, finding that the employee was constructively dismissed, held that the duty to avail of a grievance procedure is not an absolute duty. the Tribunal stated as follows:

“the claimant's conclusion that she could have no confidence in the respondent to either properly or effectively address her grievances was a reasonable conclusion in all the circumstances. Moreover, the claimant did not act unreasonably in taking into consideration the likely effect on her health and well-being were she to remain in the work environment.”

39.   In the present case, the Claimant clearly invoked the grievance procedure. The Managing Director however, showed no initiative or desire to progress the Claimant’s complaint, which was unfortunately typical of his response to previous issues raised by the Claimant. In light of the Managing Director’s unsatisfactory response, first to the Claimant’s informal requests, and then to the Claimant’s solicitor’s proposals, it gradually became apparent he was not interested in processing the Complainant’s grievance. Indeed, on one occasion he indicated his unwillingness to address the complaint’s grievance. The complainant was also entitled to consider the deleterious effect that his marginalisation in work was having on his health. It was not unreasonable, therefore, for the Complainant to lose faith in the Respondent’s ability to process his grievance and resign his employment.

Mitigation of Loss

40.   The Claimant began seeking alternative employment in early March 2019 and succeed

in obtaining full time employment on 1 May 2019.

The Facts:

The Claimant commenced employment with the Respondent on 7 September 2009 and was originally employed as a forklift operator and to answer the phones.

The Respondent started with two (2) Directors and two (2) employees, one of the employees being the Claimant.

The business remained small and survived the recession.

After the recession the Respondent grew and as more business came into the Respondent, the Claimant was rewarded for his hard work and loyalty by being given a 10% net profit from each year commencing from January 2013.

Further to the 10% net profit, the Claimant was also made a Director of the Respondent on 8 October 2015.

In or around December 2015, the Claimant approached the Managing Director about becoming a shareholder in the Company.

At this time, the shareholding that was being proposed was 10% and this was considered by the Managing Director who had his Solicitors prepare a draft Shareholder’s Agreement.

This draft was sent to the Claimant but was never returned.

In or around 11 January 2016, it became evident that the Claimant had had slates delivered (from the Respondent) to his sister’s new house which was under construction which were never paid for.

The evidence indicates that the Claimant removed all traces of the order from the Respondent’s system.

When this incident came to light and was brought to the Claimants attention, payment was requested for the slates.

A purchaser order was received from another company regarding this transaction and the amount due and owing was discharged some five (5) weeks later.

Following this, the Managing Director did not pursue or execute the shareholding agreement and the Claimant never followed up with the shareholding until October 2018.

The Respondent set up a similar company in the United Kingdom in or around 2017 and the Claimant was kept fully informed about this.

The Claimant even attended the UK four times to work with the Respondents representative who was put in place in the UK to attend trade and agricultural shows and to assist to develop the products and business.

The Claimant knew that the funding for the UK company was coming from the Respondent and as a Director of the Respondent, would have had full access to the accounts, which were reviewed monthly, and annual returns which as Director he was required to review at the end of each filing year.

At all times, the Respondent’s accountant remained in control of any and all accounting information which was used to assist the UK company and as the Claimant was not a party to the accounting team, he was provided with the information that he required to carry out his role in the set up.

Subsequently the UK company ceased trading in or around October 2017.

In or around February 2018, the Claimant was requested by the MD to go on the road to carry on his role as Sales Director. Requesting the Claimant to go on the road gave the Claimant more time to focus on his role as Sales Director, which is where his strengths lie.

It is denied that the Claimant was removed from his position as Sales Director rather the Claimant was asked to spend more time on the road as opposed to the office to allow him to source more sales.

At this time, the Claimant never voiced any grievance or concerns regarding the decision to spend more time on the road.

The Claimant was supplied with a company car, fuel card, company mobile phone, company laptop and company credit card.

In or about May 2018 the Respondent experienced a cash flow issue which required all members of staff to take a 20% pay decrease for a period of three (3) months. This was agreed to by all staff members.

In or around September 2018 the Respondent hired a Marketing Consultant. This new position was created to manage and develop all social media platforms from one centralised base and as such the Marketing Consultant was required to have all passwords and access to all of the Respondents social media and marketing sites.

In October 2018, earlier management advice given by the Respondent accountant to set up a new company was abandoned, and no changes were made to the existing company set up.

In or around October 2018, one of the Respondents best sales members resigned from the Respondent and set up his own rival company.

It was agreed between this employee and the Managing Director that the Respondent would assist the employee by giving him an opportunity to take an agency from the Respondent.

Shortly after this, the Managing Director became aware that the Claimant had intended to leave the Respondent and commence employment with the former employee.

On 4 October 2018, the Claimant invited the Managing Director to a meeting where the Claimant put a proposal forward asking that he buy the Respondent.

The Claimant asked the Managing Director to obtain a valuation of the Respondent at which point the Managing Director informed the Claimant that he would have to discuss this with the other Director.

Some four (4) weeks later, the Managing Director informed the Claimant that the Respondent was not for sale and no further discussions were had about the topic.

It is company policy to change everyone’s codes to the computer systems from time to time following the introduction of the General Data Protection Regulations. Unfortunately, this happened with the Claimant was on days off and as such, the Claimant had to regain access to the computer systems again upon his return.

In or around September 2018 the Respondent hired a Marketing Consultant. This new position was created to manage and develop all social media platforms from one centralised base and as such the Marketing Consultant was required to have all passwords and access to all of the Respondents social media and marketing sites.

On 9 November 2018 the Respondent received correspondence from the Complainant’s Solicitors who stated that they acted for the Claimant and went on to outline a number of grievances that the Claimant was experiencing.

The correspondence also went further and stated;

In that regard, given the context of our client’s grievances and the attitude of Management towards him, he will have little option but to request that the Company engage the services of an agreed Independent Investigator in order to address the issues raised herein in impartial and independent manner.

This was the first time that the Respondent became aware of any such grievances and it came as a shock to the Respondent that the Claimant did not attempt to address these issues directly with the Respondent prior to this.

On 14 November 2018, the Respondent replied to the above correspondence and outlined that as this was the first time that any grievance was raised then the Managing Director invited the Claimant in for an informal discussion about the grievances raised and attempted to resolve them at an early stage.

No response was received from the Respondents correspondence until 7 December 2018.

By way of letter dated 8 December 2018, the Respondent agreed that it would be inappropriate for the Managing Director to conduct the grievance procedure and recommended XXXXXX as an independent party to conduct the investigation or alternatively a Mediator.

On 14 December 2018, the Claimants Solicitors replied and offered suggestions for proposed Mediators.

The Mediation did not go ahead although the Respondent agreed to it.

On 17 December 2018, the Managing Director, the Company Accountant and the Claimant had a meeting to go through the Respondents year end accounts.

The Claimant resigned his position with the Respondent by way of correspondence on 11 January 2019 and in this correspondence agreed to work his notice period of one month which would put his last day of employment with the Respondent on 8 February 2019.

On 16 January 2019 the Claimant voluntarily resigned his position as Director from the Respondent.

During the months’ notice period, the Claimant and the Managing Director had multiple conversations and as 8 February 2019 approached, it was agreed between the parties that the Claimant would stay working for the Respondent as the Claimant stated that he “was at a loose end” and had yet to secure future employment.

On 17 February 2019, the Respondent became aware that the Claimant had registered his own rival company on 11 January 2019 by the name of XXXXXX Limited.

When the Respondent became aware that the Claimant had registered a rival company then the Claimant was asked to leave the Respondent property and to return all Respondent property that he holds. The Claimant had the benefit of a company car and he was allowed to return that the following day.

The Claimant gained employment with another rival company who was set up by the former employee of the Respondent which was previously mentioned.

On 7 March 2019 the Respondent became aware that the Claimant had been contacting clients of the Respondent and attempting to get the clients to transfer their business over to the company that the Claimant works for and wrote to the Claimant asking him to cease contacting the Respondents clients.

By way of correspondence dated 22 March 2019, the Respondent received a response from the Claimants second set of Solicitors, denying that the Claimant had contacted any suppliers to, customers, or clients of, the Company, nor has he engaged in any conduct of canvassing or soliciting any supplies to, customers or clients of, the Company.”

On 2 April 2019, the Claimants Solicitors wrote to the Respondent seeking “employee entitlements which remain due and owing to him for some time” and gave the Respondent until 17 April 2019 to discharge same.

These entitlements were:

Payment to the outstanding net profit share for 2018 in respect of both the Company and NSQ.

Payment to the value of the 10% shareholding agreed in 2015.

Payment of the outstanding salary for the month of February 2019.

Payment of all annual leave accrued since 2009 but not taken, which we are instructed is a total number of 159 days.

Please furnished our client’s P45.

Please ensure that our client’s name is removed from all Company websites.

The Respondent replied to the correspondence dated 22 March 2019 on 2 April 2019 and further outlined incidents of when the Claimant had approached customers of the Respondent and requested an undertaking from the Claimant.

On 3 April 2019 the Respondent replied to the request surrounding the “employee entitlements”. The replies are summarized as follows;

The net profit shares had not been established at this time as the accounts for 2018 were not finalised and the Claimant was aware of this on his departure.

It is denied that the Claimant is entitled to any shareholding of the Respondent.

Three (3) cheques were enclosed for payment relating to the Claimants February 2019 salary and holiday entitlement for 2018 which totalled €3,926.55.

The Claimant was instructed to take his annual leave, which he failed to do so, and it is denied that he is owed 156 days’ holiday leave.

As of 1 January 2019, P45’s are no longer issued.

On 3 April 2019 the Claimants Solicitors responded to the further allegations that the Claimant has contacted clients of the Respondents and agreed that the Claimant would execute an undertaking.

A draft undertaking was furnished to the Claimants Solicitors for the Claimant to execute.

On 29 April 2019 the Respondent received correspondence directly from the Claimant who informed the Respondent that the second set of solicitors are no longer acting for him. The Claimant goes on to state that there has been alleged breaches of his personal data and threatened to make a complaint against the Respondent to the Data Protection Commissioners with regard to failure to furnish all requested GDPR.

The Claimant also refused to execute the undertaking.

The Respondent had already previously furnished all personal data held by way of correspondence dated 23 April 2019.

The Claimant on 30 April 2019 wrote to the Respondents accountant, claiming that he was a Director and Shareholder of the Respondent and requesting to see the Audited Accounts for 2015, 2016, 2017 and 2018.

The Claimant also claimed that he was a beneficial shareholder of another company which is owned by the Managing Director.

The Respondent replied to both the above correspondence on 3 May 2019 denying all allegations made by the Claimant to both and all allegations set out in the Claimants letter dated 29 April 2019.

The Claimant replied on 26 May 2019 and set out further documentation which he believed the Respondent held under GDPR. The Claimant also confirmed that he had made a formal complaint to the Data Protections Commissioner and further grievances were also set out. The Claimant finished his correspondence by informing the Respondent that he would be commencing a constructive dismissal claim.

The Respondent replied on 29 May 2019 denying all allegations made by the Claimant in his correspondence dated 26 May 2019.

The Claimant commenced his claim for constructive dismissal on 8 July 2019.

The Claimant brought a further two (2) claims, one (1) under the Payment of Wages Act and one (1) under the Organisation of Working Time Act, which were commenced on 2 September 2019.

Preliminary Issue:

The Claimant has lodged two complaints on 2 September 2019.

One (1) under the Payment of Wages Act and it is the Respondents submission that the Claimant is outside the six (6) month time limit as set down by statute to lodge the claim.

The Respondent refers to and relies on section 6 (4) which states:

A rights commissioner shall not entertain a complaint under this section unless it is presented to him within the period of 6 months beginning on the date of the contravention to which the complaint relates or (in a case where the rights commissioner is satisfied that exceptional circumstances prevented the presentation of the complaint within the period aforesaid) such further period not exceeding 6 months as the rights commissioner considers reasonable.

As the Claimants last day of work was on 17 February 2019, it is the Respondent submissions that no claims that were lodged after 17 August 2019 should be entertained by the WRC.

The Respondent echoes the above preliminary issue in regards to the time limit relating to the Claimants claim under the Organisation of Working Time Act.

The Respondent refers to and relies on section 27 (4):

A rights commissioner shall not entertain a complaint under this section if it is presented to the commissioner after the expiration of the period of 6 months beginning on the date of the contravention to which the complaint relates.

The Respondent submits that there has been no exceptional circumstance that would allow an additional six (6) months extension and in fact, the Claimant has had the benefit of not one (1) but three (3) different Solicitors to guide him in respect of lodging his complaint to the WRC.

Submissions:

CA-00028168-001           Unfair Dismissals Act, 1977

The Claimant has alleged that he was constructively dismissed and that he had no other choice but to leave his employment.

The Claimant resigned on 11 January 2019 but worked his notice period and continued to stay on after his notice had expired.

The Respondent relies on Section 1 of the Unfair Dismissals Act;

“the termination by the employee of his contract of employment with his employer, whether prior notice of the termination was or was not given to the employer, in circumstances in which, because of the conduct of the employer, the employee was or would have been entitled, or it was or would have been reasonable for the employee, to terminate the contract of employment without giving prior notice of the termination to the employer.”

Further, the Respondent refers to the decision of Nicola Coffey v. Connect Family Resource Centre Ltd. (UD 1126/2014) and it was held by the Employment Appeals Tribunal that “[t]he bar for constructive dismissal is very high.” And in the current set of facts, the Claimant has failed to reach that high standard.

In A General Operative v. A Religious Society(ADJ-00002814) it was held by the Workplace Relations Commission that in claims of constructive dismissal:

The critical issue is the behaviour of the employer, although the employee’s behaviour must also be considered. Generally, the criterion regarding the behaviour of the employer is taken to mean something that is so intolerable as to justify the complainant’s resignation, and something that represents a repudiation of the contract of employment…In effect the question is whether it was reasonable for the employee to terminate the contract on the basis of the employer’s behaviour.

In Western Excavating (ECC) ltd. v. Sharpe [1978] ICR 221:

If an 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 further performance.

Furthermore, in the decision of Debbie Kearns v Silverfern Properties Ltd. (UD2428/2010):

“In order to succeed in a claim of constructive dismissal a claimant must show, that either their contractual terms were altered in such a way, going to the root of the contract, as to justify their claim or the conduct of the employer was so unreasonable as to justify the claim of constructive dismissal.”

It is submitted that the Claimant has failed to discharge the high burden of proof required and failed to utilise the grievance procedure that was available in the office and the Respondent relies further on Higgins v Donnolly Mirrors Ltd. (UD 104/1979) (taken from Mary Redmond, Dismissal Law in Ireland, 2nd Edition) the Tribunalrejected the Claimant’s claim for constructive dismissal as she had failed to discharge the heavy onus of proof she bore. Additionally, in the case of Conway v Ulster Bank Ltd. (UD 474/1981) (also taken from Mary Redmond, Dismissal Law in Ireland, 2nd Edition), the Tribunal found that the Claimant had not acted reasonably in resigning without first having “substantially utilised the grievance procedure to attempt to remedy her complaints.”

An employee handbook was provided to the Claimant which set out a detailed grievance procedure and even included that should the need arise (such as allegations directed towards upper management), then an external independent party would be engaged to conduct any investigation that would be required.

IanFlaherty v College Freight Ltd. [2009] 6 JIEC 2901, in dismissing the claim stated that they “accepted that there was a less than harmonious working relationship between the claimant and DM but did not accept that the level of that relationship was such that the claimant could show the conduct of the respondent was so unreasonable so as to justify a claim of constructive dismissal.”

In cases alleging constructive dismissal the Complainant bears the burden of proof as to dismissal. Section 1 of the Unfair Dismissals Act defines constructive dismissal as follows:

“the termination by the employee of his contract of employment with his employer whether prior notice of the termination was or was not given to the employer in circumstances in which, because of the conduct of the employer, the employee was or would have been entitled or it was or would have been reasonable for the employee to terminate the contract of employment without giving prior notice of the termination to the employer”.

There are two tests contained in the statutory definition, either or both of which may be invoked by the employee. The first is the ‘contract’ test where the employee argues ‘entitlement’ to terminate the contract. Secondly, the employee may allege that he or she satisfies the Act’s reasonableness test. In some circumstances, an employer may have acted within the terms laid down in the contract of employment, but its conduct may be nonetheless unreasonable.

In the instant case the Complainant argues that the correct approach to be taken by the adjudicator in considering whether there has been a constructive dismissal is: whether there has been a repudiatory breach by the Respondent, or, if there has not been a repudiatory breach whether the Respondent engaged in conduct which made it reasonable for the employee to terminate his contract.

The Complainant contends that from 2017 his relationship with the Managing Director started to deteriorate and the MD became very evasive when asked about a promised shareholding by the Complainant. In January 2018 the Managing Director informed the management personnel that the Complainant was ‘taking a step back and going back on the road’. In July the same year the Complainant was informed that he would be taking on the work of a departing employee, the same thing happened in October when another sales employee left the company. Also, in October 2018 the Complainant contends that his IT rights were reduced, he was locked out of some of the company databases.

On the 8th November the Complainant’s solicitor wrote to the Respondent raising concerns, inter alia, about the Complainant’s deteriorating conditions of employment, exclusion from board meeting and diversion of responsibilities. On 26th November the Respondent’s representative requested to invoke the provision of the grievance procedure which envisioned the appointment of an external person to investigate the grievance. This request was made on the express basis that the Managing Director would not be the appropriate person to conduct the investigation.

No meeting under the heading of the Grievance procedure took place.

Legal representative for the Respondent has cited the case of Conway v Ulster Bank Ltd. (UD 474/1981) the Tribunal found that the Claimant had not acted reasonably in resigning without first having “substantially utilised the grievance procedure to attempt to remedy her complaints.”

An employee handbook was provided to the Claimant which set out a detailed grievance procedure and even included that should the need arise (such as allegations directed towards upper management), then an external independent party would be engaged to conduct any investigation that would be required.

In coming to a decision in this case I cannot overlook the fact that the Respondent failed to commence an official grievance procedure when requested by the Complainant’s legal representative. I therefore find that the complaint as submitted by the Complainant is well founded.

As per the complaint form the Complainant commenced new employment on 1st May 2019, this would result in a period of 11 weeks between the ending of his employment with the Respondent and commencing new employment. This is being challenged by the Respondent who contend that the Complainant started new employment before this date. The Complainant sent an email from his new employer’s company on 2nd April 2019, this would suggest that the period of unemployment was a maximum of 7 weeks.

In coming to a decision in this case I cannot overlook the fact that the Respondent failed to commence an official grievance procedure when requested by the Complainant’s legal representative. I therefore find that the complaint as submitted by the Complainant is well founded.

I now order the Respondent to pay compensation to the Complainant in the amount of seven weeks pay i.e. €8,071.00 gross.

Payment should be made to the Complainant within 42 days from the date of this decision.

Unfair Dismissals Act, 1977.