Complainant

Respondent

Parties

Marie  Quinn

Fibreseal Stainguard Services Limited Fibreseal

Representatives

Stephen O’Sullivan BL instructed by Niall Cawley, Niall T Cawley & Co, Solicitors.

John P O'Donovan Solicitors.

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-00036287-002

21/05/2020

Complaint seeking adjudication by the Workplace Relations Commission under section 6 of the Payment of Wages Act, 1991

CA-00036287-003

21/05/2020

Complaint seeking adjudication by the Workplace Relations Commission under Section 8 of the Unfair Dismissals Act, 1977

CA-00036287-001

21/05/2020

The Complainant was employed by the Respondent as a Sales Consultant, employment commenced in or around December 2005 and ended on 26th March 2020.

The Complainant was paid €43,500 per annum (based on complaint form).

The complaint was received by the Workplace Relations Commission on 21st May 2020.

The Managing Director of the Company is Nigel Burns. The Company was established by Mr. Burns parents. Nigel Burns “succeeded” to management of the Company following an acrimonious transfer from his brother. For a substantial period of the Complainant’s employment. Management was carried out by either Mr. Burns parents and/ or brother. By a combination of health reasons and the acrimonious relationship, Mr. Burns has not been able to avail of either his parents or brother to clarify matters occurring outside his period of management.

Again, due to the nature of the transfer of management between brothers, certain documentation was removed prior to Mr. Burns assuming control. By reason of the foregoing, it has not been possible to establish, by way of documentary evidence, certain fundamental or historical matters that may be in contest between the parties.

By letter dated 26th March 2020, the Company sought to lay-off the Complainant by reason of the impact of the Covid pandemic.

By the time that correspondence had issued, all but 1 of the Company’s technicians had notified the Company that they would no longer attend customers’ premises and that they were availing of the Pandemic Unemployment Payment (PUP). In this regard reliance is placed on the Tax Deduction Cards from the Company’s payroll system demonstrating with certain exceptions, that wage payments ceased on or about the 26th March 2020. Neither Mr. Burns nor his wife took a wage from the Company from that date. One Receptionist and one technician was retained in order to maintain the minimum possible level of service whilst continuing as a going concern.

The Company provides, inter alia, fabric cleaning/ maintenance services to residential and commercial customers, in particular, the retail and hospitality sector.

Preliminary Issues.

The Company take no issue with the clerical error in completing the claim form and accepts that the Complaint is entitled to pursue all claims that she seeks to pursue.

To the best of the Company’s knowledge, the Complainant commenced employment, in or around December 2005. This is a matter that could not be confirmed with Revenue Authorities other than orally. It is noted that the Employment Agreement relied on by the Complainant was signed on the 23rd June 2005 and refers to a commencement date of 2nd July 2002. The Complainant did not work and was not paid for a period of approximately 12 months commencing on or about 1st January 2013. The Company accepts that this does not amount to a break in service.

The Company disputes the Complainants reliance on gross figures as substantiating her loss of earnings claim. In this regard reference is made to the updated document dated on or about the 15th September 2021. The Company will rely on net figures, in particular, reference is made to  being tax deduction cards for all employees for part of 2019 and all 2020. It can be seen that the Complainant’s average net weekly wage for the 3-month period Jan to Mar 2020 was as follows:

January 2678.35

February 2,832.43

March 2867.32

Total: 2,792.70 per month divided by  4.3 weeks amounts to €649.46, per week net.

Letter of the 26th March 2021

The letter notifying termination was prepared by Mr. Burns who relied on a “Google search” to assist with the wording. It was his understanding at the time that without confirmation of termination, the Complainant could not avail of PUP.

It is submitted that at the time of writing, with the exception of 2 staff, one receptionist and one technician, all other staff had availed of the PUP. The Complainant’s position in sales was not filled by an alternative appointment, her work was not carried out by any other employee and has not been filled by a new recruit as at the time of writing. The “Technician” staff notified the company en masse that they would no longer attend for work. No correspondence from the company issued to any such employee in those circumstances. It is Mr. Burns understanding that each employee registered for PUP on-line before notifying him of that fact.

It was intended that the Complainant would resume her employment, when the impact of the pandemic had passed. This is evidence from the words “I wish you all the best of luck in the future and if when this crisis is over, I hope you would contact us if and when business returns to normal.”

At paragraph 9 of her submission, the Complainant enquires whether the Company is willing to re-instate her. It is confirmed that the Complainant’s position remains open for her to return to and she is welcome to resume her duties should she wish. The Company anticipates that as of the 22nd October next when substantially all Pandemic Restriction measures are lifted that there will be an up surge of work and that it will be in pressing need of a Sales and Customer Service Consultant. Mr. Burns and the Complainant once enjoyed a warm personal friendship and it is his belief that mutual trust and confidence can be restored in light of that relationship.

Events subsequent to 26th March 2021

Following the letter of the 26th March, the Complainant attended the offices of the Company for the purpose of removing personal items. At this time, she travelled to the property using a company vehicle. She was requested to return company property including the vehicle and a company lap top. Despite repeated requests and being informed that she was not insured unless on Company business, the Complainant refused to return the vehicle and laptop. On the day in question the Complainant herself called the Gardai. As a result of intervention by An Gardai, the Complainant retuned the Company’s property.

While none of the events subsequent to 26th March are relied on by the Company in support of the letter of that date, it will be submitted that the Complainant’s belief in her entitlement to company property is only consistent with her understanding that she was being laid off and that it was intended for her to return to work when possible.

Subsequent to the intervention of the Gardai, the Company became aware that unbeknownst to it, the Complainant was accessing Company emails remotely after the 26th July. It became obvious that the Complainant had communicated with customers and directed them to competitors. One such customer contacted Mr. Burns in the belief that because he had communicated with the Complainant that it was the Company who had provided certain services to him. On enquiry, it was discovered that a competitor had done so on foot of the Complainant’s direct referral. The customer in question was not aware that the Complainant was not representing the Company at that point.

As result of the unauthorised access of Company communications, Mr. Burns made a report to An Garda Siochanna. He made a signed statement in writing to that effect. It is his understanding that the investigation remains live.

Notwithstanding the foregoing, it is submitted that while important for the sake of having complete information, none of the events subsequent to the 26th March 2020 are relevant to the matters to be determined in this complaint.

Unfair Dismissal Claim

It is accepted that the Company did not adequately give effect to its intention to lay off the Complainant. It is noteworthy that all staff, with 2 essential exceptions availed of PUP. The Company had no reason to dismiss the Complainant. It was intended that the letter of 26th March 2020 would assist the Complainant in availing of the PUP.

The Complainant’s reliance on her intention to “work getting new customers” is, with respect, misplaced. It is clear with hindsight that the Level 5 restrictions, imposed on 2 occasions since March 2020 together with level 3 restrictions makes such a belief unrealistic in the extreme.

This is not a case of contrived redundancy, all but 2 staff remained for the purpose of maintaining a skeletal workforce and ensuring continuity of the business entity. Neither Mr. Burns nor his wife have taken a wage during the period. The Complainant’s position remains unfilled and is open to her to return to.

It is submitted that the intention of the Company in issuing the letter of the 26th March was to assist the Complainant in obtaining PUP. It will be Mr. Burns’ evidence that this was repeatedly made clear to the Complainant in their conversations including when she attends the business premises to remove personal belongings.

It is submitted that taken in context, where all but a skeletal staff was maintained and where the Complainant is welcome to return to her position, that the intention of the employer was not to terminate employment. In the first instance, reference is made to the wording of the letter which invites the Complainant to return. Secondly, the position has not been filled in the interim and remains open. Thirdly, all but skeletal staff were equally treated for the purposes of obtaining PUP. Fourthly obvious context of the Global Pandemic demonstrates that the situation was neither personal to the Complainant nor contrived. 

At paragraph 22.16 of her work, Redmond on Dismissal Law, on the matter of the fact of dismissal, the learned author writes: 

As the EAT put it in Devaney v DNT Distribution Company Ltd: 21

‘... where words are genuinely ambiguous what needs to be decided is what the speaker intended. Did the employer mean to bring the contract to an end? In answering this question, what needs to be considered is how a reasonable employee in all the circumstances would have understood the employer’s intention. We find, having regard to the relationship that existed between the parties prior to the termination and the Complainant’s evidence that [the director of the respondent company] often expressed his feelings in very strong language, that the words uttered by [him] in an angry mood, did not amount to a dismissal and were never intended as such.’

The test, therefore, is objective.”

Taking an objective stance, in the teeth of a global pandemic, where all but a skeletal staff were laid off, it is submitted that the employer’s intention was not to bring about a permanent termination.

While the test is an objective one, it is submitted that hindsight on the events of the period of the pandemic may distort the reality that employers such as the Company, were being very much reactionary to unprecedented events on the 26th March 2020. 

Redundancy Claim

As of the 13th March 2020 s.12A of the Redundancy Payments Act suspended the operation of s.12 of the same Act. S.12A was inserted by s.29 of the Emergency Measures in the Public Interest (Covid-19) Act 2020. 

As such, by operation of s.12A the Complainant has no entitlement to Redundancy Payment.

Conclusion

It is submitted that the fundamental question posed on behalf of the Company is whether the it was intended to bring about a permanent termination of the Complainant’s employment. It is accepted that the letter of the 26th March 2020 would not be accepted as the standard method by which Lay-off would be initiated. It was however, intended to assist the Complaint obtain financial support in the form of PUP. While matters, including complaints to Gardai subsequently soured the relationship of the parties, it was simply unknown on the 26th March 2020 what the future held and what impact the pandemic restrictions would have or for how long.

The Offer of re-instatement is repeated. It is anticipated that the Complainant is either unwilling or unable to accept that offer. In that case, the Company is alternatively willing to pay the sum of €10,000 to the Complainant.  

The Complainant commenced employment in Sales on 2/7/02 and was dismissed for purported redundancy on 26/3/20. She was appointed Sales Representative, but in the contract of employment described as Sales and Customer Services Consultant, by a letter of appointment 10/2/02. There was a contract of employment signed 23/6/05. The key terms, taking into account both documents, included

•        pay was €25,000 per annum.

•        6 months probationary period

•        Monthly sales targets was €15.000

•        Expenses €65 per month

•        Her sales area was Galway, Clare, Limerick, Kerry, Cork Waterford. Tipperary and Waterford

•        She reported to the Company owners.

•        On 11/10/04 there was a 5% increase to her gross salary.

From January 2017 onwards, there was no salary increases but it was agreed orally with the owner in or about November of 2016 that she would get 10% commission.

The Company provides upholstery cleaning and protection services for to commercial and residential sector the claimant worked as a sales representative for all residential and some  commercial work for the company. The claimant made sale of €259,740.00 in 2017, €284021.18 in 2018 and €403,097.00 for 2019.

The Complainant received one commission cheque in the sum of €750.00 in respect of earnings for the month of February 2019, she not having attained her target in January 2019. In 2020 the Complainant’s sales figures were approximately 11,000.00 Euro in January, and a total of €46,000.00 in February and March of 2020.

The Complainant was dismissed on 26/3/20. The reason given for termination was the Covid 19  Pandemic (hereinafter the pandemic) and the consequent downturn in business.

The 27th March 2020 was the first day restrictions were put in place to stop workplace attendance save for essential services. There has been some lifting of restrictions since then. Also, it was possible  for the claimant to work if she was based at home.

The Complainant took issue with many of the points set out in the letter of dismissal:

                                 I.            In the week leading to 26/3/20 there were 4 customers booked in and they didn't cancel

                               II.            In the week of dismissal, the claimant contacted as many as 150 commercial clients  and she received 6 replies of interest.

                             III.            The issues in 2019 mentioned have little or no relevance to the claim. The sales increased progressively throughout 2018

                            IV.            Jeffrey Burns was removed from the Board of Directors and after that the claimant brought 80% to 90% of sales into the Company. Nigel Burns did not drive sales since he    joined.

                              V.            The claimant did claim the Covid payment

Insofar as the employer indicated in the letter 26/3/20 that the Complainant might be welcome  back later, the Company should indicate if this is still the position. If not, why not?

Further, if the Company wants to maintain that a redundancy was necessary, we would expect to see:

·       Financial evidence that as at 26/3/20, the Company was suffering. What do the accounts for 2019 say as compared with 2018, for instance.

·       Have any other employees been dismissed from the Company in 2020 and 2021

·       Have any employees or contractors been hired by the Company in the period since 26/3/20

·       Insofar as the claimant was chosen for redundancy and others weren't, what is the rationale for this.

·       Who has been and who will carry out the work the claimant was employed to do.

·       Has the Company benefitted from Covid grants, wage supplements or other assistance arising from Covid 19?

Unfair Dismissal Claim.

The dismissal was rushed, the Complainant had continued to work getting new customers. She  was willing to continue to work to get sales in, Insufficient account was taken of the claimant's lengthy employment with the Company.

The redundancy procedure at p.28 of the staff manual was not followed:

It says a redundancy selection process would take place and this did not occur. It says voluntary redundancy or early retirement might be offered before any selection process. Where a selection process happens, it says "All things being equal, redundancies would normally be selected on a last in first out basis. This would be subject to the retention of key skills, experience, knowledge and flexibility,"

The Employer did not consider lay off or reduced working hours from home, pending the  resolution of Covid. The Employer did not consider use of the business support provided by the government, local authorities and enterprise boards for Covid 19. The Company could have used income supplement payments, allow the claimant to claim the Pandemic Payment. sought grants etc. The Company was too quick to move to dismiss for redundancy when there was a raft of supports available.

Even if there were legitimate financial grounds for redundancy, fair procedures were not applied in making the decision to dismiss for redundancy. Good practise is the employee is  put at risk of redundancy for a period and explorations are made to see how redundancy can  be avoided. The cases establish that fair procedures are required to affect a redundancy: -

·       Boucherv, IrishProductivityCentre[1994]ELR205;

·       Cusack v, Dejay Royale Alarms Ltd [2006] ELR 51;

·       Sheehan v. Licensed Vintners Federation 2009 ELR I 55;

·       Fitzpatrick v. Eurodrug Limited 2012 ELR 165.

Redundancy claim.

In the alternative to UDA, the claimant was entitled to a redundancy payment based on her years of service and income at date of termination.

Minimum notice claim.

The Complainant was entitled to 8 weeks’ notice. She was paid no notice on dismissal.

Payment of Wages Claim.

When Nigel Burns took over as GM in March 2019, he promised the claimant a salary  increase and new car in due course, which never happened.

It had been agreed with Geoffrey Burns on or about November 2018 that the Claimant would be paid a I 0% commission on all sales that she achieved in excess of €20,000.00 per month or€240,000.00 per annum because she hadn't had a salary increase for so long. Gross sales for 2019 were €403,097.00 and for 2020 are €57,000.00 approximately for January to March of 2020. This comes to €16,309.00 for 2019.

The claimant is owed circa €9,513.58 in commission in respect of the period June 2019 to  dismissal. The I 0% due is easily calculated from documents in the Company's possession, which are no longer in the claimant’s possession. Commission was to be paid at the end of each month but only one payment was made in respect of three months.

CA – 00036287 – 001 - Complaint submitted under s.8 of the Unfair Dismissals Act, 1977.

By letter dated 26th March 2020 the Respondent states:

“It is with a heavy heart that I write the following and wish I did not have to do so. Intensified measures by the authorities to stop the spread of the coronavirus (COVID-19) have led to continued worsening of the business situation for the company (Fiberseal Stainguard services Ltd.)

As -you know most residential customers have cancelled, and all retailers of which you rely on for referrals have now closed. All businesses we deal wlth on the commercial' side of our business have also either closed or are down to a minimum staff and no one knows when they will return to work.

I have spent the past week contacting as many commercial clients as possible. As you are aware,attemptingtoofferavaried serviceto be relevant in the current situation but this has fallen on deaf ears as most are not ln work.

I suspect we will be under complete lockdown in the coming week or so, however, even if we  are not, the business is just not there under the current climate of fear as the public do not want our staff, the few we have left, to enter their homes and as stated above the commercial businesses are not there.

As you are aware, we had many issues last year which affected the business almost fatally, we have had a very poor year to date and now, with this massive blow which, as an international emergency is out of all of our control, I do not know if the business will survive.

To this end I regret that effective immediately, Flberseal Staingµard Services Ltd. has no option but to issue you your notice of termination of employment. You should of course apply  for the covid-19 payment on the government website but Sean in payroll can be contacted to go through your options at this time.

I wish you all the best of luck in the future and if when this crisis is over, I hope you would contact us if and when business returns to normal”.

There is no ambiguity about this letter. This is a clear indication that the Complainant’s employment was terminated. There was no process of consultation and no indication that any alternative to termination was explored.

This complaint submitted under s.8 of the Unfair Dismissals Act, 1977 is well founded.

CA – 00036287 – 002 – Complainant submitted under s.39 of the Redundancy Payments Act, 1967.

·       The Representative for the Complainant has accused the Respondent of ‘rushing the dismissal, the Complainant had continued to work getting new customers. She  was willing to continue to work to get sales in, Insufficient account was taken of the claimant's lengthy employment with the Company’.

The redundancy procedure at p.28 of the staff manual was not followed:

It says a redundancy selection process would take place and this did not occur. It says voluntary redundancy or early retirement might be offered before any selection process. Where a selection process happens, it says "All things being equal, redundancies would normally be selected on a last in first out basis. This would be subject to the retention of key skills, experience, knowledge and flexibility,"

The Employer did not consider lay off or reduced working hours from home, pending the resolution of Covid.

·       The Respondent failed to issue the Complainant with written notice of redundancy in accordance with clause 17(1) of the Redundancy Payments Act.

This was not a redundancy situation.

CA – 00036287 – 003 - Complaint seeking adjudication by the Workplace Relations Commission under section 6 of the Payment of Wages Act, 1991.

Section 6 (4) of the Payment of Wages Act, 1991 reads as follows:

6.(4) A rights commissioner shall not entertain a complaint under this section unless it is presented to him within the period of 6 months beginning on the date of the contravention to which the complaint relates or (in a case where the right commissioner is satisfied that exceptional circumstances prevented the presentation of the complaint within the period aforesaid) such further period not exceeding 6 months as the rights commissioner considers reasonable.

The instant complaint was presented to the Workplace Relations Commission on 21st May 2020, the cognizable period therefore is 22nd November 2019 until 21st May 2020.

The sales  figures supplied by the Complainant rep would suggest that sales in 2020 were below the €20k per month figure that would trigger the payment of any commission.

This complaint is well founded.

Minimum Notice and Terms of Employment Act, 1973.

A complaint under this enactment was not included in the original complaint. The Representative for the Complainant requested that this be included. There being no objection from the Respondent representative it was permitted to add such a complaint.

The Complainant under the terms of this enactment was entitled to notice of 8 weeks or pay in lieu thereof.

This complaint is well founded.

CA – 00036287 – 001 – This complaint submitted under s.8 of the Unfair Dismissals Act, 1977 is well founded and I now order the Respondent to pay compensation of 1 years pay i.e. €43,500 to the Complainant.

CA – 00036287 – 002 – This complaint submitted under s.39 of the Redundancy Payments Act, 1969 is not well founded.

CA – 00036287 – 003 – This complaint submitted under s.6 of the Payment of Wages Act is well founded and I now order the Respondent to pay the sum of €1,359.08 to the Complainant.

Minimum Notice and Terms of Employment Act, 1973.

The Complainant was entitled to a notice period of 8 weeks and I now order the Respondent to make a payment of €6,692.31.to her.

Note, all amounts awarded are gross amounts and may be subject to taxation.

All monies awarded should be paid to the Complainant within 42 days from the date of this decision.