Complainant

Respondent

Anonymised Parties

A Senior Developer

A Government Department

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-00026867-001

07/03/2019

This case is based on a complaint for a lump sum redundancy payment post liquidation of the complainant’s employment. The claim to a Government Body has been declined as out of time.

The Complainant, a lay litigant also referred to a claim for unpaid wages and annual leave under the Protection of Employees (Employers Insolvency) Act 1984, however, this claim is not properly before me.

The Respondent is a Government body an had rejected the claim as out of time. The Respondent made a helpful written submission. In balance, I allowed the complainant to make a replying submission which he did.

I also requested collateral information to help me explore this claim further and both parties forwarded the information post hearing which was exchanged with the parties. I make this decision base on the entirety of oral and written evidence.

The Complainant gave an outline of his claim for a lump sum redundancy payment against a Government Dept.

He submitted that he had an influential role in the Respondent Start Up Software Product company from September 2012 to April 2016. He was an employed as a full-time worker Software Developer at 37.5 hrs per week. The CEO of the company had relocated to the US in 2013 to chase funding for the innovative product.

He began to experience difficulties in securing his salary in early 2016. The employees were informed that funding due had been delayed.

He submitted that the then CEO was based in another jurisdiction, where he “conducted all of his work and fundraising for the company “

The Complainant was notified of temporary layoff for a stated 4-week period on February 26, 2016 and received his P45 in April 2016. He was not issued an RP 9 notification. During this time, the Respondent had not made anyone available for liaison or information/communication purposes. The workers were completely in the dark.

The Complainant had by then been denied wages and holiday pay but persevered in pursuit. He also continued to undertake some work for the company, specifically in addressing hardware issues from China.

In March 2017, the Respondent CEO assured the complainant that he would receive his outstanding wages, but this was never honoured. He gave the impression that the employment was still potentially live, and he hoped to be able to restore payment and production.

On May 9, 2018, the Complainant received confirmation that the respondent company had been liquidated by Court Order on 6 November 2017. It transpired that Revenue had deemed the company abandoned. Revenue and employees were identified as the sole creditors.

The Complainant was requested by the Liquidator to compile an employee questionnaire in May 2018, and IPI and RP 50 forms in August 2018.There was some delay in securing a confirmation that the questionnaire had been received by registered mail. The complainant moved to a new house in august 2018.

The Complainant understood that the Liquidator submitted these key forms to relevant government departments. In November 2018, his application was deemed out of time. This was an ad hoc announcement as no written communication was received, the complainant learned of the development when he contacted the relevant department by phone.

“The employees claim under both the Insolvency Payments Acts and the Redundancy Payments Acts have been disallowed as both claims are out of time. in the case of the former only claim arising within the period 18 months prior to the date of insolvency are eligible for payment, while in the latter, a claim must be made to the Section within 12 months of the end date of employment. In the case of the Redundancy payments Act, a claim may be made to the WRC after the expiration of the 12-month period as they have the discretion to extend the time limit for to two years or in some very specific circumstances, such as ignorance of the identity of his employer, more than two “

The Complainant submitted that his case was unusual as Insolvency and Redundancy normally co-exist in the same time pattern. In this case, the Respondent had simply disappeared and did not participate in any active engagement with employee, apart from a moment in March 2017, where he was informed that the work was to continue through an anticipated funding impetus.

The Complainant submitted that this avoidance had caused him to feel very stressed and disappointed when balanced against his hard work which had positively influenced the company development,

The Complainant sought a lump sum redundancy payment based on his weekly salary of €1211.54 per week. The Complainant had received job seekers benefit from March 1, 2016 and detailed PRSI contributions in 2012-2016, which were sporadic.

The Respondent is a Government Dept and has rejected the claim.

On 21 June 2019, the Respondent came on record in the case and sought a copy of the entire complaint of March 2019. This was duly sent and a confirmation of intention to attend the hearing was received on 16 July. The Respondent submitted a written submission in the case.

The Respondent outlined that it is the primary duty of an employer to discharge statutory redundancy to all its eligible employees. Where an employer ca proves to the satisfaction of the respondent that it is unable to pay statutory redundancy to its eligible employees, the respondent will make redundancy lump sum payments, based on set criteria and will seek to recover the debt from the employer.

A Liquidator was appointed the complainant’s company of employment by court order on 6 November 2017.

The Complainant applied for Redundancy on 27 September 2018 (€ 4896.00). When the claim handler reviewed the claim the gap in time from last day worked to date of claim exceeded 52 weeks.

On October 3, 2018, the claim was disallowed in accordance with Section 24 of the Redundancy Payments Acts as amended. A Disallowance letter was issued to the complainants Cork address. On 20 November, the complainant contacted the office for an update, he was informed of the disallowance and copies of the letter was reissued.

The Respondent set out the chronology of the events surrounding the claim an emphasised that 104 weeks post date of termination centred on April 1, 2018, whereas the application for redundancy was received some five months later.

The Respondent outlined that the complainant’s former employer had not made sustained prism employer contributions on his behalf an this also compromised his claim.

Primarily, the claim was out of time and the Respondent set out the provisions of Section 24 of the Act in support of that view.

The Respondent made it clear that all payments from the Social Insurance Fund under this scheme on foot of a WRC decision are subject to verification of gross weekly wage, PRSI contributions and service history (inclusive off Transfer of Undertakings) by the respective government Department.

The Respondent sought to answer a claim for unpaid wages, notice and annual leave and submitted a written submission in defence of the rejection of these claims .

I have taken some time to review the circumstances of this case. I have considered all written and oral submissions. I am certain that I am considering an extraordinary set of circumstances from an employment point of view.

I am mindful that the Complainant gave evidence of an energetic start-up company with enormous promise which was ultimately liquidated. I saw some extraordinary correspondence which addressed the complex relationship between the Board of Directors and the CEO which was shared with the complainant in May 2016. In summary, this correspondence pointed to a volatile and wholly uncertain employment. The complainant was truly unfortunate, given his undisputed skills to be caught in the middle of that fracas of waiting to be paid and reactivated in employment.

I am looking at this case through the Redundancy Payments Acts provisions. I have no jurisdiction to address the outstanding claim under the Protection of Employees (Employer Insolvency) Act, 1984.

The claim therefore is whether the complainant should be awarded a lump sum payment in redundancy? The Respondent has ruled out the claim to the Social Insurance fund on the claim being statute barred.

I have had to look carefully at the chronology of the employment period in this case. I have not had the benefit of sight of the p45 from April 2016. At any rate, a P45 is not solely determinative of a dismissal.

Under the Redundancy Payments Acts, lay off arises where the employer cannot provide work, but believes that is a temporary situation. Notification in this case was by way of letter dated February 26, 2016 and anticipated to last 4 weeks. The Complainant signed on for job seekers benefit on March 1, 2016.

The P45 was unsolicited in April 2016. The Complainant submitted copies of correspondence he received from the company CEO going into May 2016. These were truly extraordinary documents which pointed to an attempted “ousting of a CEO “and several options for progression at Board level. The Complainant had no direct involvement in this. I was struck by the vacuum in any information between the company and the complainant regarding his terms and conditions at this time. The employer is meant to keep employees informed during lay off. Failure to do this normally actions a claim for redundancy by an employee after specific period. In the absence of a counter notice from an employer within 4 weeks, an entitlement to redundancy normally follows.

In this case, the complainant did not action that avenue as he maintained sporadic contact with the Company CEO and undertook some aspects of work until March 2017, after which he did not hear from the company again.

He submitted that his next point of contact had followed from the Liquidator in May 2018, which notified him of an earlier Liquidation in November 2017. There was some delay in getting the pro-offered questionnaire to the Liquidators attention as the complainant submitted he moved to a new house. However, as I checked the questionnaire, I noted that it had a May 2016 date on it. This must have been an error on the complainant’s part.

A redundancy is defined as occurring when there is a dismissal of an employee by an employer not related to the employee concerned and the dismissal results wholly or mainly from one of the situations provided in Section 7(2) of the Act.

Based on the facts submitted by the complainant which were not disputed by the Respondent, I find that Section 7(b) seems to most reflect what happened in this case

Where the requirements of that business for an employee to carry out work of a kind in the place where he was so employed have ceased or diminished or are expected to cease or diminish

In Darcy V Mc Loughlin Painting Contractors limited MN 94/2007, the complainant in the case had been placed on temporary layoff in August 2006. This was followed by a notification of “indefinite “lay off the following November, where employees were invited to apply for voluntary redundancy which would not attract notice pay. The Complainant was unable to secure his notice pay as a claim for voluntary redundancy disentitles notice pay.

There are no temporal limitations to lay off. In A Post V Mc Neill 1998 ELR 19, an absence of 26 weeks due to lay off did not break continuity of service.

In the instant case, the complainant drifted in terms of both seeking payment for time worked and an assurance that his work may be re-activated up to March 2017. I accept his evidence in this.

The Respondent in this case reviewed the RP 50 submitted via the Liquidator in September 2018 and deemed it unsuccessful on two grounds, time and continuity of employer contributions “Insurability of employment “

I have considered the provisions of Section 24 of the Act on Time limits on claims for redundancy payments.

I note the provisions of Section 24(3) of the Act, where an Adjudicator delegated by the Director General, WRC has some discretion in this area.

24(3) Where an employee establishes to the satisfaction of the Director General that

(a)    Failure to make a claim for a lump sum before the end of the period of 104 weeks mentioned in that sub section was caused by an ignorance of the identity of his employer or employers or by his ignorance of a change of employer involving his dismissal and engagement under a contract with another employer

And

(b) that such ignorance arose out of or was contribute to by a breach of a statutory duty to give the employee either notice of his proposed dismissal or a redundancy certificate

The period of 104 weeks shall commence from such a date as the Director General at his discretion considers reasonable having regard to all the circumstances.

In this case, the complainant did not attend his workplace from late February 2016. However, he was available to the CEO of the Company from this time forward, who appeared to call on him to support the Chinese market. In a separate and parallel process, the complainant received two notifications from the company that the CEO was to be removed but no clear successor was made known to him. I was particularly struck by a copy of a partially signed removal notice to same. The backdrop to this employment was chaotic and anarchical.

This can only be reasonably determined as an “ignorance of the identity of the employer “. This was accompanied by a blatant breach of the company’s responsibilities to address the complainant on either notice of his proposed dismissal or provision of a redundancy certificate. It is worthy of note that the company did not issue part A of an RP 9 on Temporary layoff in this case.

I am satisfied, based on all the circumstances I have considered , that I should action my discretion provided to me in Section 24(3) of the Act and determine that the 104 weeks permissible to claim redundancy should commence on 25 March 2017, one week after the CEO informed the complainant of the realistic prospect of the relaunch of his employment from temporary layoff.

This allows the complainant to be considered for a Redundancy lump sum payment.

I am also satisfied that the complainant is entitled to a redundancy payment in accordance with Section 7(2) (b ) of the Act .

I find his claim to be well founded .

Decision:

Section 39 of the Redundancy Payments Acts 1967 – 2012 requires that I decide in relation to the complaint in accordance with the relevant redress provisions under that Act.

I find the claim to be well founded and the complainants appeal succeeds .

I find that the Complainant is entitled to a Redundancy payment . The complainant is not responsible for administration of his PRSI contributions in the workplace , this administrative responsibility is the sole preserve of his then employer and may need further scrutiny based on the Respondent submission and the rider below .

Date of Commencement:   3 September 2012

Date of Termination:         1 March 2016 (Commencement of Lay Off)

Gross Weekly Pay:     €1211.54 (€600 of which is reckonable in calculation of lump sum)

Breaks in service: None

This award is made subject to the complainant having been in insurable employment under the Social Welfare Acts during this period

Redundancy / Social Insurance Fund