ADJUDICATION OFFICER DECISION
Adjudication Reference: ADJ-00025394
Parties:
| Complainant | Respondent |
Anonymised Parties | A Manager | A Tour Company |
Representatives | Mason Hayes & Curran | Peninsula |
Complaint:
Act | Complaint Reference No. | Date of Receipt |
Complaint seeking adjudication by the Workplace Relations Commission under Section 8 of the Unfair Dismissals Act, 1977 | CA-00032230-001 | 15/11/2019 |
Date of Adjudication Hearing: 04/02/2020
Workplace Relations Commission Adjudication Officer: Valerie Murtagh
Procedure:
In accordance with Section 41 of the Workplace Relations Act and Section 8 of the Unfair Dismissals Acts, 1977 - 2015, following the referral of the complaint to me by the Director General, I inquired into the complaint and gave the parties an opportunity to be heard by me and to present to me any evidence relevant to the complaint.
Background:
The complainant commenced employment as a Senior Project Manager with the respondent company on 20 March 2018. She states that she was dismissed on 29 May 2019 under the guise of redundancy. She has lodged a complaint of unfair dismissal in relation to her termination of employment. |
Summary of Complainant’s Case:
The complainant states that prior to her employment with the respondent, she had a very successful wedding and event planning business. She maintains that she joined the respondent following a number of approaches by it to join the team over the course of a number of months. When the complainant commenced employment with the respondent, it was agreed that she could continue to a limited extent with her wedding planning business outside of her working hours and responsibilities to the respondent. The complainant states that she was responsible for managing and co-ordinating events in Ireland for customers from the North American market. The complainant managed two other project managers. The complainant reported to Mr. P, MD of the respondent’s Irish business and worked alongside Ms O. The complainant submits that during her employment, she managed a number of successful events which far exceeded target earnings for the financial year 2018. The complainant states that she raised issues of bullying from August 2018 by Ms. O and the complainant took a period of stress leave in February/March 2019. The complainant submits that following her return from sick leave, Mr P invited her to a meeting and criticised her performance and commitment to her role. This meeting was followed by another meeting with Mr. P where the complainant was informed that her role was suddenly at risk of redundancy due to a downturn in confirmed bookings from the North American market. The complainant states that no other employees dealing with this market were at risk. The complainant outlines the following chronology of events ;
The complainant submits that It is apparent from the chronology of events that the respondent behaved in a wholly unreasonable manner and the whole process was solely designed to remove her from her position. The complainant asserts that the process in no way allowed her to put forward any alternatives to her role being made redundant and it was only the complainant’s role that was made redundant despite the alleged reasoning affecting the whole US department. The complainant submits that her role was not redundant and this is clearly evidenced by the respondent publicly advertising the complainant’s role in order to replace her some months after the role was “redundant”. The complainant states that it is significant that there was no change or reduction to the employees in the respondent’s US department. The complainant further states that after she was dismissed, another individual was hired into the event management team bringing the headcount back to 4 staff. In addition, and after another member of the team left, the respondent less than six months later was openly advertising online to fill the role held by the complainant prior to her dismissal and bring the numbers back to 4. The complainant states that her role was therefore clearly not redundant and the whole process was entirely designed to cover up an otherwise unfair dismissal. The complainant asserts that she relies on the case of Engineer v Consulting Engineering Company ADJ00016780 where the WRC found that the key characteristics of a redundancy process require “impersonality” and “change”. In that case, the WRC found the complainant had been unfairly dismissed following a redundancy process initiated only after complaints were raised by the complainant in relation to the inappropriate behaviour of management. Similarly, the complainant argues that in her situation, this process was only initiated after her return from a period of sick leave and a meeting where Mr P questioned her performance and commitment to the role before concluding that they should both consider their positions in relation to the complainant’s employment as he felt she was not happy in her role. The complainant highlights that the redundancy process that followed was neither impersonal nor impartial. The complainant states that the EAT was faced with a similar position in Capaldi v C-Step Shoes Ltd UD 806/1989 where it found in favour of the complainant on the basis of the evidence before it that: ‘...the Managing Director did threaten to let her go at his first interview with her. In our view he would have done so if he could but ... instead, he contrived a redundancy so as to get rid of her.’ The complainant states that she was brought into a meeting with Mr P where he criticised various aspects of her performance and commitment to her role including the handover of her work while she was on certified sick leave before concluding that both individuals should consider their positions. This meeting was subsequently followed by a meeting where Mr P informs the complainant that due to a downturn affecting the whole department, only her role was at risk of redundancy. The complainant argues that this sequence of events clearly shows that at best the process followed was highly prejudicial, personal and biased. She states that the process was in fact an entirely sham process contrived to get her out of a role Mr P was not happy with her performance in and did not believe she was committed to. The complainant also cites the caselaw in Shanley v IT Alliance Ltd UD467/2002 while accepting there was a genuine restructuring and rationalisation programme in place, the EAT found the complainant had been unfairly dismissed where: “…the process and selective criteria used to justify the claimant's redundancy was very subjective.There was also an unnecessary element of secrecy connected with this issue.” The complainant states that she was selected for redundancy before the process even began. There was simply no selection criteria put forward to her as part of the consultation process nor was there any rationale given for her role being the only one singled out for redundancy in the US department. The complainant states that as she was the only employee the subject of the redundancy process, despite other employees dedicated to the US department, there can be no other conclusion than that the reason for letting her go was not redundancy but for some other personal reasons. The complainant cites the caselaw in Sheehan and O’Brien v Vintners Federation of Ireland Ltd [2009] ELR 155, where the EAT held that the claimants had been unfairly dismissed even though the redundancy was found to be genuine. The employees provided proposals to the company on how their jobs could be retained and the company did not take these into consideration. The Tribunal was critical of, inter alia, the employer’s failure to: ‘consider earnestly the claimants’ proposals regarding the reorganisation of the work which would have realised significant savings’. The complainant states that she, at her first meeting with Mr P, suggested reviewing budgets and costs to determine whether there were any cost savings to be made to avoid the redundancy. Mr P immediately refused to have such an option even investigated. In addition, Mr P refused to allow the complainant to consider or put forward any alternative to the redundancy of her role, the only role the subject of the redundancy process. Similarly in JVC Europe Limited the High Court further noted: “It may be prudent, and a mark of a genuine redundancy, that alternatives to letting an employee go should be examined. … Similarly, a fair selection procedure may indicate an honest approach to redundancy by an employer … Following what is on the surface a fair procedure does not necessarily demonstrate that the decision maker is taking an honest approach to a decision. As with much else, an apparently fair procedure can be used as a cloak for deceptive conduct. It may be followed in form only so as to mask an ulterior motive or with no intention of fulfilling its purpose, even should the best of reasons for not proceeding to redundancy arise during its course.” The complainant further relies on the EAT’s decision in Keogh v Mentroy Limited UD 209/2009, where the EAT found in favour of the complainant in circumstances where performance issues had been raised. In that case there was a downturn in business and the employer in that case only selected the manager’s role while other more junior roles were being filled. “In light of these extraneous considerations it seems that the employer failed to take an overall view of the workplace with the objective of seeing what would be the fairest thing to all its employees. The Tribunal does not doubt that the claimant would have returned to the shopfloor on a lesser salary rather than be faced with unemployment. There were many options open to the employer including short time and layoff… The reasons given were not the reasons being relied upon. No consideration was given to alternative workplace arrangements where the claimant was eager to stay and the hours were required.” The complainant states that the respondent refused to examine any alternatives to the complainant losing her role. The respondent failed to consider whether the complainant would take a pay cut to cut costs, or whether reduced hours or a layoff would be an alternative. The complainant states that the respondent had a complete disregard for the overall fairness of the singling out of the complainant for the redundancy. That, in and of itself, is sufficient to prove that the whole process was predetermined and the complainant was unfairly dismissed. The complainant refers to the EAT which set out a test, in Daly v Hanson Industries Ltd UD 719/1986, for considering any redundancy defence raised by an employer, the defence may be tested in two ways: (a) was the redundancy genuine, or did the dismissal take place under the cloak of redundancy? (b) was there a cause and effect relationship between the redundancy and the dismissal? The complainant argues that in applying the above test by virtue of the headcount in the US department remaining the same and the advertisement to fill the complainant’s role, the purported ‘redundancy’ could not be considered a genuine redundancy. Notwithstanding the fact that this dismissal was not a genuine redundancy, (1) the timing of the process as a follow up to a performance review meeting, (2) the singling out of the complainant as the only employee at risk of redundancy and (3) failure and refusal to consider any alternative short of the complainant leaving her role clearly illustrate that the purported ‘redundancy’ was not the cause of the dismissal. |
Summary of Respondent’s Case:
The respondent states that in late 2018, the respondent experienced a considerable downturn in its North American market with business dropping off by roughly 50%. The respondent states that it initiated a series of measures to manage this, however, by April 2019 the situation had shown no signs of abating and had become untenable. This forced the respondent to examine its cost base and it implemented a series of corrective actions in order to maintain the viability of the business. The respondent submits that it was forced to examine the viability of it maintaining a Senior Project Manager for this market and it became clear that having a standalone role for this area of the business was under threat. The respondent contends that on 9 April 2019, it invited the complainant to an “At Risk” meeting for the following day on 10 April. This was described in the e-mail as a “consultation session regarding your role in Company X [my emphasis], as explained by C due to a decrease in business, your role is at risk, no decision has been made as yet, this is an opportunity to get your views and discuss further”. At this meeting, it was outlined to the complainant the reasons for the role being at risk and the complainant was invited to send on suggestions that could be considered to see if the role could be made viable again. The respondent submits that on 16 April, a consultation meeting was held with the complainant and Mr. P. The respondent maintains that at this meeting, the complainant’s role was again described as at risk and she was advised that the senior management team had been contacted regarding opportunities in their departments. The respondent states that on 24 May, the complainant was asked if she could meet MP to discuss the Group Training Manager role and this was provisionally scheduled for 2 May. The respondent contends that on 26 and 29 April, the complainant was requested to forward her updated CV in order to be considered for this new role. The respondent states that on 29 April, the draft job specification was forwarded to the complainant. The respondent states that the company had created a new role of Group Training Manager, a role that the respondent felt would be an excellent fit for the complainant. The respondent states that MP, a Senior Executive, was flown over from the new HEAD Office in the UK to speak to the complainant about the role. The respondent states that the role was offered for consideration by the complainant. The respondent states that a second role was also discussed with the complainant in the area of the Contracting Department. The respondent submits that on 7 May, the complainant requested some information concerning her options. From her e-mail of that date and the Company’s subsequent response on 9 May: a ) Option A Claimant : My current role is to be made redundant, could you provide more information on what would happen in this situation and when would it take effect ? Company response: At this stage, your role is at risk and the final decision needs to be discussed with you in detail and … also we need an update on option B from MP. I will schedule a meeting with CDP and you and I for later today or Friday. B ) Option B Claimant: I am offered a suitable alternative role with the company and that the role of Group Training Manager is currently being offered. Company response: This role is currently open and interviews are taking place, no offer has yet been made. Claimant: Can you please clarify the package being offered, also considering there would be extensive travel involved. Can you advise when the start date would be for this new role. Company response: As details will be provided once a decision has been made. M is also interviewing other candidates this week in Harrow and we await an update. The respondent submits that its response on 9 May asked the complainant if she could confirm to MP that she was interested in the role and TPG (Tour Party Group) as to this point, she had not confirmed she was interested in the role and it was necessary for the Company in order to make decisions regarding the role. The respondent submits that on 15 May, the complainant withdrew from being considered for these roles and effectively chose Option A as above. The respondent submits that a final meeting was held on 15 May and a decision was made to make the complainant’s role redundant only after all avenues having been considered. The respondent states that by way of a letter on 15 May with a clarification on 2 July 2019, it was set out that all monies together with the amount as to the redundancy payment was laid out. The respondent maintains that it made a significant redundancy linked payment though the complainant did not meet the threshold for the two-year requirement for a statutory payment. The decision was taken that the complainant’s role would be completed with two of the more junior staff members taking some of the complainant’s roles responsibilities and with another senior member of the team taking the remaining of the work. The respondent refutes the allegation that the complainant was dismissed and states that the redundancy was fair in all of the circumstances. The respondent reiterates that it did not consider the complainant on a personal level when considering roles to put at risk. |
Findings and Conclusions:
The issue for decision by me is whether or not the complainant was unfairly dismissed by the respondent company. Section 6 of the 1977 Act provides: “6. – (1) 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. (4) Without prejudice to the generality of subsection (1) of this section, the dismissal of an employee shall be deemed, for the purposes of this Act, not to be an unfair dismissal, if it results wholly or mainly from one or more of the following: ... (c ) the redundancy of the employee Redundancy for the purposes of the 1977 Act is defined with reference to section 7 of the Redundancy Payments Act, 1967; “7(2) For the purposes of subsection (1), an employee who is dismissed shall be taken to be dismissed by reason of redundancy if for one or more reasons not related to the employee concerned the dismissal is attributable wholly or mainly to - (a) the fact that his employer has ceased, or intends to cease, to carry on the business for the purposes of which the employee was employed by him, or has ceased or intends to cease, to carry on that business in the place where the employee was so employed, or (b) the fact that the requirements of that business for employees to carry out work of a particular kind in the place where he was so employed have ceased or diminished or are expected to cease or diminish, or (c) the fact that his employer has decided to carry on the business with fewer or no employees, whether by requiring the work for which the employee had been employed ( or had been doing before his dismissal) to be done by other employees or otherwise, or (d) the fact that his employer has decided that the work for which the employee had been employed (or had been doing before his dismissal) should henceforward be done in a different manner for which the employee is not sufficiently qualified or trained, or (e) the fact that his employer has decided that the work for which the employee had been employed (or had been doing before his dismissal) should henceforward be done by a person who is also capable of doing other work for which the employee is not sufficiently qualified or trained” In the case of JVC Europe Ltd v Panisi [2011] IEHC 279, Charleton J stated; “In all cases of dismissal, whether by reason of redundancy or for substantial grounds justifying dismissal, the burden of proof rests on the employer to demonstrate that the termination of employment came within a lawful reason. In cases of misconduct, a fair procedure must be followed whereby an employee is given an entitlement to explain what otherwise might amount to a finding of real seriousness against his or her character. In an unfair dismissal claim, where the answer is asserted to be redundancy, the employer bears the burden of establishing redundancy and of showing which kind of redundancy is apposite. Without that requirement, vagueness would replace the precision necessary to ensure the upholding of employee rights. Redundancy is impersonal. Instead, it must result from, as section 7(2) of the Redundancy Payments Act 1967, as amended, provides, “reasons not related to the employee concerned”. Redundancy, cannot, therefore be used as a cloak for the weeding out of those employees who are regarded as less competent than others or who appear to have health or age related issues. If that is the reason for letting an employee go, then it is not a redundancy, but a dismissal.” Judge Charlton recited two specific legal requirements in effecting a legitimate redundancy, both of which are directly relevant to the instant case; The first is Section 7(2) of the Redundancy Payments Act 1967, as amended by Section 4 of the 1971 Act, and by the Redundancy Payments Act 2003, wherein Section 5 (2) 1 requires that “(2) For the purposes of subsection (1), an employee who is dismissed shall be taken to be dismissed by reason of redundancy if for one or more reasons not related to the employee concerned the dismissal is attributable wholly or mainly … “ five listed grounds. Thus, highlighting the essential requirement of “impersonality” in effecting a fair dismissal on grounds of redundancy, noting later that in St. Leger v Frontline Distributors Ireland Ltd [1995] E.L.R 160 at 161 to 162, an EAT Chairman stated that “Impersonality runs throughout the five definitions in the Act.” In this case, Judge Charelton remarked that “It may be prudent and a mark of a genuine redundancy that alternatives to letting an employee go should be examined” and that “a fair selection procedure may indicate an honest approach to redundancy by an employer”. Having carefully considered all the evidence in the instant case, on the balance of probabilities, I find that there were issues around the selection for redundancy and the manner and implementation of the redundancy process in relation to the complainant. While the respondent has argued that the redundancy came about as a result of a shortfall in revenues in the North American market, having heard the evidence, I do not find that this was the reason behind the complainant, and her alone being made redundant. I am satisfied that a reasonable employer would not have behaved in the manner in which the respondent treated the complainant in the within case. I note that no other staff members were considered for redundancy and it was personal to the complainant. I find, based on the evidence heard, that there was a failure on the part of the respondent to properly consult the complainant in relation to her redundancy and the process had the hallmarks of a biased and predetermined outcome. There is an obligation in a situation such as the instant one on the respondent to seek out alternative employment for the complainant being made redundant. In this regard, I am cognisant of the EAT decision in Jeffers v DDC Ireland Ltd. UD 169/2000, where the EAT held that where a person was being made redundant, there was an onus on the employer “(i) to take reasonable steps to seek alternative employment within the company for the employee being made redundant, (ii) to know what positions, if any, are available on the relevant date, and (iii) to offer any such reasonable alternative positions to the employee whose position is becoming redundant.” Whilst the respondent argued that it tried to pursue an opportunity for alternative employment for the complainant, this was not borne out from the evidence adduced at the hearing. I conclude that the respondent did not pursue any meaningful alternative employment options in respect of the complainant. I am cognisant that the redundancy process was only initiated after the complainant’s return from a period of sick leave and a meeting where Mr. P questioned her performance and commitment to the role before concluding that they should both consider their positions in relation to the complainant’s employment as he felt she was not happy in her role. Where a company seeks to rely on redundancy as a ground for dismissal, this must be strictly construed. An essential aspect of redundancy is impersonality and the dismissal must result wholly or mainly from redundancy. The decision in Daly v Hanson Industries Ltd. (UD 719/1986) is instructive in considering whether a redundancy is genuine or whether the dismissal took place under the cloak of redundancy, and if there was a cause and effect relationship between the redundancy and dismissal. Based on the sequence of events in the instant complaint, the essential requirements of “impersonality” and “change” in effecting a fair dismissal on grounds of redundancy were not evident in the instant case. I note that after the complainant was dismissed, another person was hired into the event management team bringing the headcount back to four staff. I further note that after a member of the team left, the respondent, less than six months later was openly advertising the complainant’s exact job role to bring the number back to four employees. Having considered the totality of the evidence in the instant claim, I find that the process adopted by the respondent was unfair, unreasonable and disproportionate. Accordingly, I conclude that the complainant was unfairly dismissed. In considering redress, I find that financial compensation would be the most appropriate remedy in the circumstances. I have considered the information submitted in relation to losses and mitigation of loss. I note that since the complainant’s dismissal that while she has applied for a number of roles including having undergone interviews for same, she has not been in a position to source an alternative employment role although she did secure some one- off consultancy events. In the circumstances of the instant claim, taking all the relevant factors into account, I deem it appropriate to order the respondent to pay the complainant €17,500 in compensation for her unfair dismissal. |
Decision:
Section 8 of the Unfair Dismissals Acts, 1977 – 2015 requires that I make a decision in relation to the unfair dismissal claim consisting of a grant of redress in accordance with section 7 of the 1977 Act.
For the reasons set out above, I find that the complaint pursuant to the Unfair Dismissal’s Act is well-founded. I find that the dismissal by reason of redundancy was not a genuine one and has rendered the dismissal unfair. I order the respondent to pay the complainant €17,500 in compensation for her unfair dismissal. |
Dated: June 18th 2020
Workplace Relations Commission Adjudication Officer: Valerie Murtagh
Key Words:
Unfair dismissal, selection for redundancy |