Complainant

Respondent

Anonymised Parties

A bank official

A bank

Representatives

Self                

In-house legal.

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-00033929-001

22/01/2020

The Complainant commenced employment with the Respondent on 24th December 2001, this employment ended on 18th December 2019.

This complaint submitted under section 39 of the Redundancy Payments Act, 1967 was received by the Workplace Relations Commission on 22nd January 2020.

The Complainant commenced work with the Respondent on 24th December 2001 and worked 37 hours per week until 2nd January 2017 at which time she commenced a period of Carer’s Leave. During this period of Carer’s Leave the Complainant reduced her hours to 15 hours per week to enable her spend time with her son who has a disability.

On 2nd January 2019 when the Complainant was due to return to her full-time hours (37 hours per week) the Complainant applied for and was granted a reduced hours contract that would entail her working 15 hours per week, this arrangement was approved by the Respondent for a period of 12 months. This arrangement would expire on 2nd January 2020 at which time the Complainant would return to her original contract i.e. working 37 hours per week.

In October 2019 the Respondent offered all staff the opportunity to apply for a Voluntary Severance Programme, the Complainant applied due to the long term needs of her son and exited the Respondent organisation on 18th December 2019.

The complaint presented by the Complainant relates to the statutory redundancy amount paid to her by the Respondent. The Complainant had worked 15 years on her full-time hours and the remainder at her reduced hours. The Complainant believes that this has cost her in the region of €9,000.

In her own words, the Complainant feels:

“I feel it is very unfair that I have not received my full entitlement for all my years working full-time and that I am punished due to being part time in the last three years due to reasons which were out of my control”.

The Complainant began working with the Respondent in 2001 and worked 37 hours per

week until 2017. In January 2017, the Complainant took Carer’s Leave, working 15 hours per

week. The Complainant’s Carer’s Leave came to an end at the end of December 2018.

Following this the Complainant requested to work reduced hours of 15 hours per week,

rather than return to her full-time hours.

In November 2019, the Complainant applied for and was granted voluntary redundancy,

receiving a statutory redundancy lump sum payment and an ex gratia payment as

consideration for entering a voluntary severance agreement, which included a waiver of her

rights to take a claim against the Respondent under various legislation, including the Acts.

The Respondent submits that the Complainant should therefore be unable to take this claim

against the Respondent by virtue of her entering into the voluntary severance agreement.

Without prejudice to the above, the Respondent submits that the Complainant’s statutory

redundancy was calculated by reference to her salary at the time of her redundancy, in

accordance with section 2 of Schedule 3 of the Acts.

In circumstances where the Respondent intends to raise a preliminary issue, the Respondent respectfully requests that these preliminary issues be addressed at the outset of the hearing.

In this regard, the Respondent relies on the decision of the High Court in The Minister for

Finance v The Civil and Public Service Union [2006] IEHC 14 where Laffoy J. states clearly that it is

reasonable to assume that the Oireachtas envisaged that the Labour Court would manage

its caseload in a sensible manner and that where a decision on a net issue might resolve a

dispute, it would deal with that net issue as a preliminary point.

Preliminary issue – Waiver of Rights

On 8 October 2019, the Complainant made an application to the Respondent for

consideration under the Respondent’s Voluntary Severance Scheme.

On 4 November 2019, following a telephone call with the Respondent, the Complainant sent

an email to the Exits Team of the Respondent in which she stated:

“If I accept my offer for VS my exit date is the 18th December 2019 and my full-time hours

would not be due to start again until the 4th January 2020. My concern is as I’m currently

part time and Annual pay is €15,654 approx. on the Ready Reckoner for the Stat Redundancy

piece when I input my Weekly Salary it is approx. 301.56. As this is significantly less than the

Stat amount of €600 x 2 for all my years’ service. Am I going to be effected here?”

The Respondent replied by email dated 4 November 2019, stating:

“we have confirmed that the statutory redundancy calculation is based on your current

weekly salary. So, if your current weekly salary is approx. 301.56, then this is the figure that

will be used to calculate the statutory part of your VS payment.”

By letter dated 12 November 2019, the Respondent informed the Complainant that her

application for voluntary severance had been successful. This letter stated:

“Please read this letter carefully and take independent advice if you wish before you decide

whether to accept the offer. In particular please review the attached Schedule 1 to this letter, outlining your proposed severance calculations, based on your salary and service history within the Bank.

This offer is made subject to the terms and conditions set out in Schedule 2 to this letter (“the Terms and Conditions”).

IMPORTANT – INDEPENDENT ADVICE

“This letter constitutes a legal offer. If you accept it then you will create a legal contract

between yourself and the Bank to terminate your employment. The terms and conditions

have important effects on your relationship with the Bank, including but not limited to the

termination of your employment. It also affects your right to bring or continue complaints,

grievances and legal proceedings against the Bank. Accepting this offer of voluntary

severance will also affect your financial position, and you should particularly remember that

any borrowings you have with Staff Business will be transferred to normal commercial rates.

If you are in any doubt whatsoever about the legal and financial effects on you of this offer

and/or the content of this letter then we encourage you to seek independent legal and

financial advice before you take any action……

If you have reason to believe that any of the information in relation to your employment with the Bank is incorrect please contact the Exit Programme Office…. If there are errors in the information we have used then we will correct them and issue a new offer letter to you.”

Section 9 of Schedule 2 of the letter states:

“Having been given the opportunity to take independent legal advice this offer is made on

the condition that you accept your Severance Payment and the other terms of this offer in

full and final settlement of all claims and potential claims that you have or may have against

the Bank, its officers, employees and agents arising out of your employment and its

termination whether arising under common law, statute or otherwise; including but not

limited to:

(i) claims under the legislation listed in Schedule 3 to this letter;

(ii) any current grievance or complaint which you have in relation to your employment

(whether formal or informal), which is deemed to be withdrawn with effect from the

date on which you sign the letter;

(iii) claims relating to notice;

(iv) claims relating to accrued annual leave entitlement; and

(v) claims in respect of personal injury (other than injuries which are not known and could

not reasonably be known to you at the date of this letter).”

Schedule 3 of the letter provides a list of legislation covered by section 9 of Schedule 2,

including the Acts.

Page 4 of Schedule 1 of the letter provides the Complainant’s statutory redundancy amount

of €11,969. Calculated by reference to the Complainant’s weekly salary of €310.40

multiplied by the relevant number of weeks (38.56)

The Complainant signed this letter on 18 November 2019.

In consideration for entering into this agreement, the Complainant received ex gratia

payment of €39,270 in addition to her statutory lump sum, which was paid to her on 18

December 2019.

It is submitted that the Complainant is estopped from taking this complaint against the

Respondent by virtue of her entering into this legally binding agreement.

The Respondent cited a number of legal cases, these included:

·         Sunday Newspapers Ltd v Stephen Kinsella and Luke Bradley (2008) 19 E.L.R. 53.

·         Hurley v Royal Yacht Club [1997] E.L.R. 225

·         Board of Management of Malahide Community School -v- Conaty, [2019] IEHC 486

·         Irish Life Assurance PLC v John Healy EDA 1514 (2016) 27 E.L.R.

·         Customer Success Guru v An Ecommerce Company, ADJ-00020068

In the final example the Adjudication Officer has stated the following:

“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.”

Background / Facts

The Complainant worked approximately 35 hours per week until she requested and took

Carer’s Leave in 2017. The Carer’s Leave notification letter from the Respondent to the Complainant dated 23 November 2016 regarding her request for Carer’s Leave and letter from the Respondent to the Complainant dated 24 January 2017. These documents outline that the Complainant was to be on Carer’s Leave working reduced hours of 15 hours per week, from 3 January 2017 until 3 January 2019. The letter of 24 January 2017 outlines that the Complainant’s annual salary will be reduced from €36,617 to €14,844.

The Complainant’s Carer’s Leave arrangements were due to come to an end on 3 January

2019. In advance of this, the Complainant made an application for the reduced hours (15

hours per week) to continue from 4 January 2019 to 3 January 2020. This application was

accepted and a letter issued to the Complainant on 20 November 2018 confirming this,

and outlining that her annual salary would be €15,671.

The Complainant worked 15 hours per week, for the duration of her employment in 2019,  earning a weekly salary of €310.40.

The Complainant was made redundant on 18 December 2019, at this time her annual  salary was €15,671, amounting to €310.40 per week.

The Law

Section 2 of Schedule 3 of the Acts provides that:

“In calculating the amount of the lump sum, the amount per annum to be taken into

account shall be that obtaining under section 4(2) of the Redundancy Payments Act 1979

at the time the employee is declared redundant.”

Section 13 of Schedule 3 of the Acts provides:

“For the purposes of this Schedule, in the case of an employee who is paid wholly by an

hourly time rate or by a fixed wage or salary, and in the case of any other employee whose

remuneration does not vary in relation to the amount of work done by him, his normal

weekly remuneration shall be taken to be his earnings (including any regular bonus or

allowance which does not vary in relation to the amount of work done and any payment

in kind) for his normal weekly working hours as at the date on which he was declared

redundant, together with, in the case of an employee who is normally expected to work

overtime, his average weekly overtime earnings as determined in accordance with

paragraph 14.” (emphasis added)

In the case of Minister for Labour v Nokia Ltd unreported, High Court Costello J March

30 1983 and noted at (1984) 4 J.I.S.L.L. 49, the High Court accepted that the salary of the employee at the date of declaration of redundancy was the appropriate amount for the calculation of the statutory redundancy lump sum.

Accordingly, it is the Complainant’s salary at the time she was declared redundant (€310.40 per week) which is relevant for the calculation of her statutory redundancy lump sum.

Conclusion

The Complainant is precluded from taking this claim by virtue of her entering into a

binding agreement not to take such complaints, about which she was advised in writing

to seek legal advice and for which she received the sum of €39,270 in consideration. None

of which has been returned to the Respondent. It is submitted that the Complainant is

therefore estopped from taking this claim.

Without prejudice to the above, the Respondent calculated the Complainant’s statutory

redundancy lump sum by reference to her salary at the time she was made redundant,

which is required under Section 2 of Schedule 3 of the Acts.

I can understand why the Complainant feels that she has been treated unfairly. She contends that she has not received her full entitlement to statutory redundancy.

This is actually not the case, the Complainant has received her statutory entitlement under the Redundancy Payments Acts.

I have read the Respondent’s submission since the hearing and agree that the method of calculation of the statutory redundancy amount is in total compliance with the Acts.

I have no alternative but to find that the complaint is not well founded.

I have no alternative but to find that the complaint is not well founded.

Redundancy.