ADJUDICATION OFFICER DECISION

Adjudication Reference:  ADJ-00020068

Parties:

Complaint:

Date of Adjudication Hearing:  18/11/2019

Workplace Relations Commission Adjudication Officer:  Aideen Collard

Procedure:

The Complainant referred a complaint of victimisation and discriminatory dismissal under Section 79 of the Employment Equality Acts 1998–2015 to the Workplace Relations Commission (WRC) on 26^th February 2019.  Following referral to me by the Director General, I inquired into this complaint.  I gave the Parties an opportunity to be heard by me and to present any relevant evidence.  At the hearing on 18^th November 2019, the Complainant the was unrepresented and indicated that he did not wish to avail of legal or other representation.  The Respondent was represented by Mr Simon Donagh BL instructed by Matheson Solicitors and a number of witnesses attended on its behalf.  The Respondent raised a preliminary objection to the WRC’s jurisdiction to adjudicate on this complaint in circumstances where it was contended that the Parties had entered into a binding compromise.  I deemed it necessary to hear the Parties’ evidence and submissions in relation to this preliminary issue.  I clearly outlined to the Parties that if I found in favour of the Respondent in respect of the preliminary objection that would be the end of the matter and a decision would issue.  If I found in favour of the Complainant, a further hearing date would be fixed to hear the substantive complaint with directions as to the exchange of documentation and my reasons would be contained in the final decision.  The Complainant was also afforded a two week period to avail of advice and revert with his position given the objection.  In further correspondence, he confirmed that he wished to pursue his complaint whilst the Respondent reiterated its position.  The Parties’ respective positions are summarised hereunder followed by my findings & conclusions and decision.  I have taken all of the evidence, submissions, supporting documentation and case-law / law presented into consideration. 

Background:

It is common case that the Complainant was employed by the Respondent from 4^th May 2018 as a Customer Success Guru working remotely from home and earned €29,000 per annum.  Whilst it is not in issue that his employment was terminated on 22^nd January 2019, the Complainant contends that he was victimised and discriminatorily dismissed on the ground of race whilst the Respondent contends that his employment was terminated for poor performance during an extended probationary period.  Although the Complainant accepts that he signed a compromise agreement waiving his entitlement to pursue a complaint under various statutes including the Employment Equality Acts, he submits that he is nonetheless entitled to pursue this complaint.  The Respondent submits that he is estopped and strenuously refutes the substantive basis for his complaint.

Preliminary Objection – Parties have entered into Compromise Agreement

Summary of Respondent’s Case:

A HR Manager gave evidence on behalf of the Respondent setting out the terms of the compromise agreement and the circumstances in which the Parties had entered into this agreement following the termination of the Complainant’s employment on 22^nd January 2019.  A copy of the agreement and related documentation was submitted along with written submissions.  The agreement was headed ‘Compromise Agreement’ and outlined the respective Parties’ details.  It was agreed that the Complainant’s employment would terminate with effect from 22^nd January 2019 and any other claims that he might have against the Respondent would be compromised in consideration for the payment of €1,450 and acceptance of the terms and conditions therein.  Clause 2.1 expressly provided that the agreement was in “…full and final settlement, satisfaction, release and discharge of any and all claims, actions or causes of action, contracts or liabilities, whether under statute, common law, equity or otherwise arising out of the Employee’s employment or termination of his employment which he has or may have against the Company,…”.  It broke down the €1,450 to be paid between gross payments of €557.69 in lieu of notice, €55.77 in lieu of accrued annual leave and an ex gratia payment of €836.54.  Paragraph 2.3 listed the various statutes which were covered by the agreement including the Employment Equality Acts.  Clause 2.5 stipulated that the employer will make settlement payment within 21 days of the agreement.  It was not disputed that full payment had been made by 15^th March 2019 to the Complainant and had not been returned as at the date of this hearing.  Part 7 of the agreement provided: “The Employee acknowledges that he has been advised to and afforded the opportunity to take legal advice on the terms of this Agreement and understands the effect and implications of this Agreement.  The Employee further acknowledges that he has entered into this Agreement without any coercion of any description.”  In bold writing immediately above the Complainant’s signature, by signing the agreement, he confirmed: “I agree that I fully understand the terms of this release of the letter referred to above from my Employer to me.  I have had independent legal representation in connection with this release or the opportunity to obtain the same.  I have executed this Release agreement freely, voluntarily and without duress.”  The HR Manager confirmed that the Complainant had been furnished with the agreement by email and a virtual meeting had been held via Zoom whereby the document was fully explained to him.  The offer was also accompanied by an explanatory covering letter confirming that statutory entitlements “…will be provided regardless of whether or not you accept the offer…” and the conditional offer of the ex gratia payment of €836.54 is “…to assist you with your transition to new employment”. The HR Manager contended that the settlement had been handled fairly.  The Complainant had not been required to sign the document immediately and in fact he did not sign it until 24^th February 2019 as confirmed by email correspondence scanning it back to the Respondent.  However, just two days after signing this compromise agreement, on 26^th February 2019, the Complainant referred the complaint herein under the Employment Equality Acts to the WRC.  Notwithstanding same, he had accepted the ex gratia payment and had not returned the money.

Counsel for the Respondent outlined the current legal position and caselaw pertaining to compromise agreements arising from employment disputes as set out more fully hereunder.  Particular reliance was placed upon the High Court Judgement in Sunday Newspapers Ltd -v- Stephen Kinsella and Luke Bradley (2008) 19 E.L.R. 53 and the Labour Court determination in Irish Life Assurance PLC -v- John Healy EDA 1514 (2016) 27 E.L.R. 211.  It was submitted that the compromise agreement herein satisfied the legal requirements set out in the former case and that the latter referred to a similar situation wherein the claimant was held to be estopped from pursuing a complaint under the Employment Equality Acts following receipt of payment under a settlement.  It therefore follows that this Complainant is estopped from pursuing this complaint in circumstances where he has accepted payment in full and final settlement of all claims arising out of his employment with the Respondent expressly including claims under the Employment Equality Acts.

Summary of Complainant’s Case:

The Complainant confirmed that he wishes to pursue a complaint of victimisation and discriminatory dismissal against the Respondent on the ground of race arising out of the termination of his employment and seeks compensation.  He is a German national and ethnically is from the Comoros Islands.  He is of the view that he has been treated less favourably owing to his darker skin colour. 

In response to the Respondent’s preliminary objection, the Complainant accepted that he had signed the compromise agreement as outlined above but contended that he should still be permitted to pursue this complaint.  In particular, as he had been due to go on holiday to Africa the day after he was presented with the agreement he was put under pressure.  He contended that an email dated 29^th January 2019 from the Respondent put him under further pressure by stating: “Just reminding you that the signed release document is due today in order for you to receive the additional payment.”  He also alleged that payment of his statutory entitlements was made contingent upon signing the agreement.  He further contended that the lawyer he had consulted did not have knowledge of the Irish legal system.  When questioned, he confirmed that he had returned to Europe from 15^th February 2019 and had not signed the agreement until 24^th February 2019. 

Findings and Conclusions:

As a preliminary issue, I must determine whether the Complainant is estopped from pursuing this complaint of victimisation and discriminatory dismissal under the Employment Equality Acts and accordingly, whether the WRC has jurisdiction to adjudicate upon same.  As relied upon by the Respondent, the leading authority in relation to agreements which compromise employment statutory rights is Sunday Newspapers Ltd -v- Stephen Kinsella and Luke Bradley (2008) 19 E.L.R. 53.  In that case, former employees who had entered into severance agreements sought to pursue complaints under the Protection of Employees (Fixed-Term Work) Act 2003 arguing that a waiver of their rights under the Act was void.  In the High Court, Smyth J. allowed an appeal against the Labour Court making a number of generic findings with reference to decided caselaw.  Firstly, he confirmed that an employee could enter into an agreement in relation to his or her statutory rights and the question of whether or not such rights had been compromised was a matter for the proper construction of the agreement itself.  Secondly, he adopted Hurley -v- Royal Yacht Club [1997] E.L.R. 225 which considered the circumstances where claims can be legitimately compromised and held that an employee being offered a severance package was entitled to be advised of his entitlements under the employment protection legislation and any agreement or compromise should list the various applicable statutes or at least make it clear that they had been taken into account by the employee.  In addition, an employee should be advised in writing to seek appropriate advice as to their rights and in the absence of such advice, a severance agreement waiving statutory rights would be void.  Recognising the need to enable parties to enter into settlement agreements, this Judgment was recently approved by the High Court in Board of Management of Malahide Community School -v- Conaty Irish Employment Law Journal 2019, 16(3), 85-87 so long as there is informed consent.  In Irish Life Assurance PLC -v- John Healy EDA 1514 (2016) 27 E.L.R. 211, the Labour Court held that the doctrine of promissory estoppel applied.  Having entered into and acted upon a financial settlement of High Court Proceedings with the benefit of legal representation which compromised and waived all claims arising from the claimant’s employment with the respondent, the claimant was deemed to be estopped from pursuing a subsequent complaint under the Employment Equality Acts. 

Given the unequal positions of strength between employers and employees and protective nature of employment statutes many of which contain non-waiver provisions, an examination of the circumstances surrounding an agreement compromising same requires close scrutiny.  Applying the undisputed facts herein to the principles elucidated in the aforesaid caselaw, I am satisfied that firstly as a matter of construction, the compromise agreement herein was intended as full and final settlement of any existing and potential claims arising from the Parties’ employment relationship including a complaint under the Employment Equality Acts.  Secondly, I am satisfied that there was informed consent.  The agreement expressly referred to the Employment Equality Acts and the Complainant was advised in writing to seek legal advice as to his rights and acknowledged that he had availed of such advice by signing the agreement.  Thirdly, there was no evidence of oppression or undue pressure being brought to bear amounting to duress.  In particular, I am satisfied that the Complainant had ample opportunity to consider his position and avail of appropriate advice before signing the agreement and it was open to him to reject the offer and pursue a complaint to the WRC instead.  Likewise, I do not regard the email of 29^th January 2019 referred to above as pressurising the Complainant, particularly as it was clear that it was only the “additional payment” that was conditional upon return of the signed agreement.  Neither is there any evidence of his statutory entitlements being contingent upon signing the agreement and in fact the explanatory letter expressly confirmed otherwise.  Finally, both Parties acted upon the agreement with the Respondent paying over the ex gratia sum and by the Complainant accepting same.  Consequently, I find that the Complainant is estopped from pursuing a complaint under the Employment Equality Acts and accordingly, the WRC does not have jurisdiction to adjudicate on the substantive complaint.

Decision:

Section 79 of the Employment Equality Acts, 1998-2015 requires that I make a decision in relation to the complaint.  Based upon the aforesaid reasoning, I find that I do not have jurisdiction to adjudicate on this complaint pursuant to Section 76(6) of the Acts and accordingly dismiss same.  Given the circumstances, I am of the view that it would not serve the interests of either Party or the public to name the Parties and I am therefore exercising my discretion to anonymise same.

Dated:   13^th January 2020

Workplace Relations Commission Adjudication Officer:  Aideen Collard

Key Words: Employment Equality Acts – Settlement / Compromise of Statutory Entitlements