Complainant

Respondent

Parties

Paul  Daly

Fastnet Recruitment ltd T/A Fastnet Talent Group (Title amended on consent at hearing)

Representatives

Appeared in Person   

 Jennifer O’Brien, Human Resource Manager

Act

Complaint Reference No.

Date of Receipt

Complaint seeking adjudication by the Workplace Relations Commission under Section 39 of the Redundancy Payments Act, 1967

CA-00043340-001

31/03/2021

This matter was heard by way of Remote Hearing pursuant to Civil Law and Criminal Law (Miscellaneous Provisions) Act, 2020 and SI 359/2020, which designates the WRC as a body empowered to hold remote hearings.

On March 31, 2021, the Complainant, a Lay Litigant submitted a claim which declared that he had not received a lump sum redundancy payment on conclusion of his employment on 21 June 2020.

The claim is denied by the Respondent.

Both parties were requested to furnish post hearing documentation consisting of contract of employment, legal submissions, ADJ 27444. These were received, exchanged and commented on.

As the Complainant was submitted under the Redundancy Payments Acts 1967, both witnesses swore an affirmation in accordance with S.39(17) of the Act.

Both parties considered the impact of the Supreme Court case of Zalewski v Adjudication Officer and WRC [2021] IESC 24 and wished to press on with the case at hand.

The Complainant outlined that he had worked as a Process Operator on 12 month rolling contracts with the Respondent Agency from 20 February 2017 until 21 June 2020. His gross pay was €1127.10 in return for a 42-hour week.

He exhibited details of his contract extension 28 December 2019 to 23 June 2020 in the context of the client returning to a 3-shift system and the lack of recourse to contract of indefinite duration.

The Complainant submitted that he had been notified of his forthcoming redundancy on 19 March 2020. This was to occur on 23 June 2020. A letter was exhibited which reflected joint signatures of the respondent and complainant to notification of redundancy and a plan to offer a breakdown “closer to your end date “

He applied for new work, independent of the respondent, and was one of 5 successful candidates who secured direct employment on the pre-existing client site. He commenced this work on 22 June ,2020.

The anticipated Redundancy Payment did not materialise. He received correspondence dated 12 June from the Respondent which altered this course.

“As you know, your contract with X will commence from Monday June 22, therefore your contract with X will come to an end officially as of the week ending June 21. As your role will remain in existence, and you will be continuing in employment with X, you will not be entitled to a redundancy payment ….”

This was followed by a commitment to facilitate the transfer, pay annual leave and close payroll.

There were material changes in the new work in terms of a different rota and pay. The Complainant confirmed that the Respondent had no role in his securing this position for him.

The Complainant was aware of one of the 5 colleagues who had challenged the non-payment of a redundancy lump sum, who had gone on to receive a positive recommendation from the WRC.

He clarified that he had not been requested to sign any documentation on conclusion of work with the Respondent and understood that he had been dismissed through redundancy. He sought a lump sum payment in redundancy and confirmed there were no breaks in his service.

The Complainant confirmed that he had not activated a grievance in terms of his anticipated redundancy payment.

He agreed to make a submission on the Redundancy Payment Act, 1967.

The Respondent did not cross examine.

The Complainant submitted a copy of ADJ 28844 dated 10 February 2021, his contract of employment. By way of legal submission, he distinguished the position he held with the respondent to the new work commenced on 22 June 2020. He disputed the respondent submissions on the terms of the new work, which he secured separate from the respondent support package.

The Respondent operated an Employment Agency and provided personnel to a client site. This is their first appearance at an external third-party dispute’s resolution forum.

The Complainant was one of these personnel, who commenced work at the Client site in 2017 and due to an upturn in business, 3 shifts became 4, his contract was extended.

By June 2020, the 4th shift had diminished, and 3 shifts were to resume. The Respondent explored options and possibilities for retention of personnel, but it was not possible.

There were 13 in the group assigned to the Client Site. 8 were made redundant and 5 got other jobs. The Complainant was in the latter category. The Respondent had played an active role in facilitating these interviews with the client site and providing support in relaunching. The interviews were held in May 2020.

The Respondent submitted that the complainant had worked continuously and had not experienced a break in service or economic loss prior to his commencing the new position. The eight workers who had not been successful in transition were disappointed and were paid redundancy.

The Respondent confirmed that they had collaborated with the site and advocated for all 13. There was no impediment to the complainant accepting work on the client site. He was free to make the transition from agency worker to direct employee.

The Company had not appealed ADJ 28844 for Commercial reasons.

By way of legal submission, the Respondent reaffirmed that the complainant had left before the nominated date of termination, 23 June 2020. He had been re-engaged by the client company via an elaborate collaboration between the respondent and the client site. His role was unchanged and omnipresent on the client site.

The Respondent wholly disputed the redundancy claim as the circumstances which prevailed had not constituted a bone fides redundancy. They argued that Market Volitivity was responsible for the changes. The Redundancy Payments Act was drafted long before Agency Work became the norm in the employment market and the circumstances of this case had not been considered in law.

 The Complainant had not been dismissed, he had left and had started his new work before his termination date. He had received recognition of past service in his new employment. The Respondent did not have documentation to reflect the Complainant leaving their employment.

The Respondent reflected that they were open to discussing the situation with the complainant, while he was in employment, but had not been approached. The Respondent had varied the March 19, 2020 declaration once it became apparent that the complainant was formally moving to work at the client site as this negated the anticipated redundancy situation.

The Respondent concluded by submitting application of Section 9 and Section 10 to the facts of the case.

This is a case where the claim for a lump sum redundancy payment is at issue. The presiding legislation is the Redundancy Payment Act, 1967, from where my jurisdiction commences. I appreciate that ADJ 28844 stands unchallenged and I understand that others may also be raising challenges in mirror claims.

I would like to state that my decision is based solely on the facts elicited at the hearing and from oral evidence adduced. I have also considered the written submissions of both parties.

I established that the parties had not engaged in any discussions on the change of direction attributed to the Redundancy situation during the live employment. I listened as the complainant stated that the complainant had received the 12 June 2020 notification by email and this was not accompanied by a verbal exchange. I listened also as the Respondent told me that they were open to hearing from the complainant. I would like to have seen a meaningful engagement between the parties around the 12 June email. It was clear to me that this had been a respectful working prelateship and it may have assisted the parties to tease out this conflict locally in the first instance.

The Respondent has submitted that this scenario had led to their first appearance at WRC. The Complainant submitted that he recognised a certain currency in ADJ 28844 and sought its application to him also.

I am bound to consider the facts as they evolved for both parties in this case.

It is clear from the Respondent communique dated December 10, 2019 that the Complainant was due to have his employment terminated on 23 June 2020 through a diminution in shift work which in turn seemed to act as a recorded justification for not issuing a contract of indefinite duration.

This was followed by a very clear and unambiguous notification of redundancy dated 19 March 2020. Both parties accept this chronology.

At that time, the complainant was notified:

“On 23 June 2020, you will be entitled to a redundancy payment “this was introduced as a statutory redundancy payment and a break down was planned “closer to your end date “.

I accept that this prompted the complainant to find new work. I also accept that the Respondent behaved responsibly in promoting support mechanisms for re-employment and relaunch.

The Respondent wrote to the complainant by way of email dated 12 June 2020 and adopted an altered course when they wrote:

“As your role will remain in existence, and you will be continuing in employment with X (client company), you will not be entitled to a redundancy payment. We will work with you to facilitate your transfer to X and make sure this is as smooth as possible …….”

I established that no further communication is recorded in respect of this email and the Complainant ceased work on 21 June 2020 without a material record of his departure. He agrees that he commenced direct employment on the client site on June 22, 2020.

The Respondent has argued that his departure prior to the notified end date has negated any veritable claim for redundancy. That the respondent and the client site collaborated to ensure the complainants seamless favourable employment prevailed. That his situation was distinguished from the 8 employees who were paid redundancy and who were not taken on by the client site.

The Complainant did not agree with this submission.

The Respondent has also submitted that I have regard for public policy and how an Agency operates via market volatility. They argued that the Redundancy Payments Act is out of step with these market forces as it predated them.

I have considered the submissions of the parties and I see the need to set out some key provisions of the Redundancy Payments Act, 1967, as amended.

Section 4 (1) (a) of The Redundancy Payments Act, 1967 provides that the Act applies to employees employed in insurable employment under the Social Welfare Consolidation Act, 2005.

There are some excepted employments and situations through familial and residential circumstances, none of which apply in the instant case.

Section 7(1) provides a framework for payment of redundancy providing a dismissal occurs on foot of 104 weeks service.

Section 7(2) clarifies Section 7(1) by

(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 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.]

 Redundancy is based on Impersonality and change.

Section 9 of the Act covers

 Dismissal by employer

(1) For the purposes of this Part an employee shall, subject to this Part, be taken to be dismissed by his employer if but only if–

(a) the contract under which he is employed by the employer is terminated by the employer, whether by or without notice, or

(b) where, under the contract under which the employee is employed by the employer the employee is employed for a fixed term or for a specified purpose (being a purpose of such a kind that the duration of that contract was limited but was, at the time of its making, incapable of precise ascertainment), that term expires or that purpose ceases without being renewed under the same or similar contract, or]

(c) the employee terminates the contract under which he is employed by the employer [ …] in circumstances (not falling within subsection (5)) such that he is entitled so to terminate it by reason of the employer's conduct.

In Smorg Roi Management ltd V Buckley RPD 12/2018, the Labour Court pointed out that a termination of a fixed term contract resulted in a redundancy situation on a blending of the provisions of Section 7(2) (b) and Section 9(1)(a).

The High Court in UCC V Dr Naomi Bushin [2012] 23 ELR 251, upheld the Labour Court decision on the correct application of an ex-gratia redundancy as opposed to statutory on termination of employment.

However, Section 9(3) also offers a helpful clarification on recognising a redundancy or not and the administrative specific performance requirements of the parties which should accompany a consensual move to another employer.

(3)

(a) An employee shall not be taken for the purposes of this Part as having been dismissed by his employer if–

(i) he is re-engaged by another employer (hereinafter referred to as the new employer) immediately on the termination of his previous employment,

(ii) the re-engagement takes place with the agreement of the employee, the previous employer and the new employer,

(iii) before the commencement of the period of employment with the new employer the employee receives a statement in writing on behalf of the previous employer and the new employer which–

(A) sets out the terms and conditions of the employee's contract of employment with the new employer,

(B) specifies that the employee's period of service with the previous employer will, for the purposes of this Act, be regarded by the new employer as service with the new employer,

(C) contains particulars of the services mentioned in clause (B), and

(D) the employee notifies in writing the new employer that the employee accepts the statement required by this sub-paragraph.

(b) Where in accordance with this subsection an employee is re-engaged by the new employer, the service of that employee [with the previous employer] shall for the purposes of this Act be deemed to be service with the new employer.

I fully accept that the respondent was an active participant in seeking opportunities for the complainant through its redundancy support package. However, I must accept that the complainant found his own new job through interview in May 2020. I understand that the Respondent was not present at interview.

 However, I could not find any evidence of compliance with the tri partite agreement and statement referred to in S 9(3)(iii). Both parties accept that no further engagement followed the 12 June email.

 I must conclude that the mandatory rituals, that may have caused the complainant to lose out on redundancy through immediate re-employment were not executed in this case and I cannot apply the provisions of Section 9(3).

I will now move to Section 10 of the Act.

10. Employee anticipating expiry of employer's notice

(1) This section shall have effect where—

(a) an employer gives notice to an employee to terminate his contract of employment, and

(b) at a time within the obligatory period of that notice, the employee gives notice in writing to the employer to terminate the contract of employment on a date earlier than the date on which the employer's notice is due to expire.

(2) Subject to subsection (3), in the circumstances specified in subsection (1) the employee shall, for the purposes of this Part, be taken to be dismissed by his employer, and the date of dismissal in relation to that dismissal shall be the date on which the employee's notice expires.

(3) If, before the employee's notice is due to expire, the employer gives him notice in writing—

(a) requiring him to withdraw his notice terminating the contract of employment as mentioned in subsection (1)(b) and to continue in the employment until the date on which the employer's notice expires, and

(b) stating that, unless he does so, the employer will contest any liability to pay to him a redundancy payment in respect of the termination of his contract of employment, but the employee unreasonably refuses to comply with the requirements of that notice, the employee shall not be entitled to a redundancy payment by subsection (2).

[(3A) Where an employer agrees in writing with an employee to alter the date of dismissal mentioned in a notice under subsection (1)(a) given by him to that employee so as to ensure that the employee's notice under subsection (1)(b) will be within the obligatory period in relation to the notice under subsection (1)(a), the employee's entitlement to redundancy payment shall be unaffected and the employee shall, for the purposes of this Part, be taken to be dismissed by his employer, the date of dismissal in relation to that dismissal being the date on which the employee's notice expires.]

(4) In this section—

(a) if the actual period of the employer's notice (that is to say, the period beginning at the time when the notice is given and ending at the time when it expires) is equal to the minimum period which (whether by virtue of any enactment or otherwise) is required to be given by the employer to terminate the contract of employment, “the obligatory period” in relation to that notice, means the actual period of the notice;

(b) in any other case, “the obligatory period” in relation to an employer's notice, means that period which, being equal to the minimum period referred to in paragraph (a), expires at the time when the employer's notice expires.

It is the Respondent case that it had placed the Complainant on notice of termination of employment in March 2020. This was accepted by the Complainant. The Respondent submitted further that the prospect of becoming direct employed by the client site, following a collaboration by the respondent, distinguished and separated the complainant from the 8 recipients of redundancy.

Dismissal was denied. To prove redundancy dismissal needs to be the cornerstone from which all else flows.

Section 2 provides a definition for date of dismissal.

“date of dismissal”, in relation to an employee, means—

(a) where his contract of employment is terminated by notice given by his employer, the date on which that notice expires,

(b) where his contract of employment is terminated without notice, whether by the employer or by the employee, the date on which the termination takes effect, and

(c) where he is employed under a contract for a fixed term, and that term expires without the contract being renewed, the date on which that term expires,

and cognate phrases shall be construed accordingly;

I looked for pointers on how the termination had unfolded  

1 letter of 10 December 2019

2 Respondent letters of 19 March and 12 June 2020

3 How the respondent interpreted the application of leave on leaving. They applied S23 of the Organisation of Working Time Act, 1997 on cesser pay which had regard for two separate and distinct employers

I would like to have seen the formal record of notice submitted by the complainant to balance the email of June 12, 2020. However, I am satisfied that the complainant had given that notice in the aftermath of his May interview as the respondent reflects the amended finish day of June 21 rather than the earlier announced June 23. This brings the circumstances of the case firmly within the parameters of Section 10 of the Act.

I am satisfied that the respondent notified the complainant of the termination of employment which was to occur on June 23, 2020. I am satisfied that the complainant countered this by furnishing a finish date of June 21. Crucially, the Respondent did not follow through on the terms of section 10(3) of the Act and I cannot safely interpret the June 12 email as coinciding with that mandatory requirement for action.

Therefore, I must conclude that the complainant can rely on the default mechanism provided for in Section 10(3)A) and hi employment came to an end by dismissal where Section 7(2) (b) and Section 9 (1) of the Act collided.

I would add that I understand that the Respondent was well disposed to the complainant’s opportunity to join the client site as a direct employee. However, a redundancy situation by its very nature is technical and is meant to rest on impersonality and change and not fixed to the employee him/her self. I find that this is a situation where a Policy /Procedure redundancy would be beneficial going forward and I respectfully suggest that the Respondent considers such a Policy which may address some of the Public Policy statements advanced at hearing.

In this case, I found that the complainant was dismissed through redundancy on 21 June 2020.

I find the claim to be well founded.

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

I have found that this employment concluded by means of redundancy through application of Section 7(2)(b) and Section 9(1) of the Act. The complaint is well founded.

The Complainant is entitled to recover a lump sum payment in redundancy based on:

Dates of Employment: 20 February 2017 – 21 June 2020

Break in service:            None

Gross Weekly Pay:         €1,127.10

Contingent on the complainant having been in insurable employment in accordance with the Social Welfare Acts.

Redundancy lump sum when re-employment follows