Complainant

Respondent

Parties

Szilvia  Bota

Fifth Avenue Nail Boutique Limited

Representatives

  Appeared In Person

Peter Godwin

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-00038943-001

29/07/2020

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.

This case was held in Public and both witnesses relied on the affirmation to accompany their evidence.

At the conclusion of the hearing, the Complainant was requested to submit her yearly Dept of Social Protection records governing the years 2020 and 2021. This was necessary for me to ascertain the sequencing of illness benefit /Job Seeker’s benefit .  I also included a request for sight  of an email from the complainant to the respondent dated 16 July 2020 .

These documents were received and exchanged with the Respondent , but did not generate a response .

The Respondent operates a Beautician Business for the past 13 years. The claim for unfair dismissal is denied.

On 8 October 2020, by means of a responding submission, the Respondent outlined that the complainant had not been unfairly dismissed, but rather had been made redundant on 20 July 2020 by an email communication dated 20 July 2020. The electronic platform was relied on as the complainant had not been present in the country for some time.

The Company Representative outlined that the business had suffered trading difficulties because of the national pandemic and closed to the public on 12 March 2020.

The business re-opened on 29 June 202o and was supported by TWSS on “all qualifying employees until August 31, 2020. This was replaced by EWSS.

The Business had hesitated on workforce management following the opening as some of the 51 employees had resigned. After several weeks, it became apparent that the Business would need to make two redundancies.

Selection was decided on

1 job performance (online customer reviews)

2 availabilities for work 

3 hours worked

The Respondent stated that the complainant had more negative customer reviews than any other member of staff.

The complainant had indicated that she did not know when she was returning to Ireland by means of an email to the owner dated 24 June 2020.

The Complainant was judged to be part time with back up support work. It was felt that the impact of redundancy would be less than on a full-time employee with no alternative employment.

The Complainant was notified of her redundancy on 20 July and paid statutory entitlements

“….. we cannot physically service as many clients as we did before the crisis as a result of the social distancing measures we have had to introduce. Therefore, we need fewer staff than before the crisis and have had to make the difficult decision to make you redundant with immediate effect ….”

The Respondent added an adjunct submission on 4 May 2021 which outlined the unstable trading climate which continued to prevail at the respondent business. the business regretted the redundancy but believed it justified.

On the Hearing Day, the Respondent Representative, Mr A attended without the Proprietor. He confirmed that he had been party to the deliberations around trading and work force which had culminated in the complainants Redundancy on July 20, 2020.

Respondent Evidence:

Mr A confirmed that all 51 staff had been placed on temporary layoff when the business decided to close due to the pandemic in March 2020.

The business had had a tough 18-month trading history.

He submitted that all staff were requested to return to work on June 29, 2020. He outlined that the business had reached out to the complainant on 24 June.

The Complainant informed the business that she would not be attending work due to personal circumstances.

By June 2020, the business had recorded a 94% reduction on previous year trading. By July 2020, a 26% reduction.

The Business soon discovered that service was depleted due to covid restrictions on space allocation. The plan was to reduce head count as it was unknown how long the government subsidies would continue for.

The Business did not have a history of redundancy or an agreed mechanism for identification of candidates.

Two redundancies were identified as the goal based on a finite selection criterion of:

1.       Job performance

2.       Availability for work

3.       Full time / part time.

The Complainant had not forwarded sick notes to coincide with her reported illness period and the first the business became aware of the sick leave was in the context of the WRC complaint form.

The Business had 42 employees on the books in December 2020. There were 51 on June 29.

Two more staff had returned to the business from maternity leave.

The Respondent denied that the Business was actively recruiting staff and referred to the complainant’s submission of active advertising to be a standard exercise, currently dormant. The Business did not need staff. The Complainant had not been replaced as her Redundancy had been genuine.

During cross examination, the Complainant asked Mr A why he thought she had written to the business on 16 July? She qualified this by stating that she had no income at that time.

Mr A responded in saying that the employer had not known of her whereabouts at that time or when she had intended on returning. He reaffirmed that PUP had ceased, and the complainant had not submitted sick notes to cover her absence.

Mr A confirmed that he had not been involved in the face-to-face management of the complainant. He confirmed that he had collaborated with the Proprietor in selecting the two candidates for redundancy. He understood that the complainant was engaged in parallel private work.

They had not shared the outcome or markings of their deliberations.

The Respondent Representative took issue at the paucity of detail of loss and mitigation in the complainant’s evidence. 

He did not recall a probation process or record.  The Complainant had not exercised an appeal of the decision to make her Redundant.

The Respondent concluded by framing the redundancy against the obvious need of the company to cut costs once the re-opening was bedded down in July 2020. He contended that the Redundancy was always genuine.

The Complainant had stood back from the re-opening and her intentions of return were unclear and not defined. The Respondent had supported the complainant’s bereavement by allowing her 3 days compassionate leave.

The Complainant was selected fairly for Redundancy and the Respondent acted reasonably in response.

He closed by outlining that the complainant had not done anything to mitigate the loss of her employment. She had not made any identifiable efforts to find new work.

The Complainant is a Hungarian Lay Litigant. She worked as a Nail Technician with the Respondent business from 27 February 2019 until her dismissal on 21 July 2020. She received payment of €370 gross weekly. The Complainant has not worked since her dismissal.

The Complainant presented her case with the assistance of a Hungarian Interpreter.

On 29 July 2020, the Complainant submitted a complaint of Unfair Dismissal against the Respondent. She outlined that the business had closed on 16 March 2020, during the early pandemic. She submitted that the Business had recommenced trading on 29 June 2020, but she had been unable to return to work through a series of personal bereavements in her country of origin, all of which impacted greatly on her wellbeing.

The Complainant recorded her dissatisfaction that the respondent had not maintained contact with her when she received an email communicating her dismissal on 21 July 2020. She contended that this was an unfair dismissal as she was one of two staff not retained out of 300. She sought justice.

Complainant Evidence:

The Complainant outlined that she had been faced with Redundancy. She contended that this was not a genuine redundancy.

She confirmed that she had worked part time at the respondent nail salon over Wednesday Thursday and Friday. She had held a separate Hotel job, which had ceased in February 2020.

She submitted that she was the most qualified Nail Technician at the business and had performed highly and flexibly with her 10-15 clients daily, 9.30 am to 8 pm. She had not been subject to the probation clause contained in her contract of employment.

The Complainant had been on lay off during the pandemic and learned from social media that she should prepare for a return in work in June 2020 by purchasing equipment and attending free training. She purchased the equipment worth €100.

On 24 June 2020, the Complainant experienced a personal bereavement and travelled home to attend this event on 27 June. She was required to self-quarantine on her return to Ireland on July 5 and adhered to this.

The Complainant confirmed that the invitation to return to work was not recorded and circulated.

The Complainant understood that the Proprietor had notified the Authorities that PUP payment was no longer required to be paid at the business from late June. The weekly payment of €350 ceased.

The Complainant applied for Illness Benefit online through the Dept of Social Protection and received her first payment on July 20. 

On 16 July, the Complainant, aware of her right to compassionate leave emailed the company seeking this consideration . she exhibited a copy of this email post hearing .

The Complainant received notice of her redundancy on 21 July , 2020 by email . There were no reasons provided. There were no steps followed and she was not afforded her rights. She did not understand redundancy or dismissal. She had not been provided with a staff handbook.

The Complainant suspected that the Salon Owner held a personal grudge against her, but she could not prove it.

The Complainant confirmed that she had subsisted on social welfare (job seekers benefit) from 27 July 2020 for a nine-month period.

The complainant gave a vague account of loss and mitigation surrounding application for 3 jobs with ex colleagues. She confirmed that she was very stressed during this time.

She argued that she had been unfairly dismissed as she had been denied information or alternatives to her dismissal. In addition, no consideration was given to her working part time.

During cross examination, the complainant confirmed that she had been out of the country from 27 June to 5 July.

She had suffered badly following her personal losses and this the first occasion where sick leave was recorded during her employment. She had consulted the citizens information service for guidance.

When asked why she had not provided sick certs for the attention of her employer, she confirmed that she had no recollection of section 6 on the contract of employment.

The Complainant denied that she had continued working in the private sector. She reaffirmed that her personal losses had affected her greatly, but she was intent on returning to her work with the respondent in August. She was medically advised to take sick leave.

The Complainant emphasised her long standing qualifications and exhibited same at hearing.

In response to the Respondent representative, the complainant confirmed that she really couldn’t say who should be exited through redundancy, however, she herself believed that her ability and skill ought to have saved her from exit.

The Complainant concluded that she had been unfairly selected for redundancy when she was out of the business addressing family bereavements. The way she was treated made her recovery protracted. She was denied engagement or any proper consultation on the topic of her departure from the business.  She had not been provided with a reason for her dismissal.

The Complainant exhibited two medical certs which reflected the presence of a medical condition 24 June -8 July and 20 July to 2 August 2020. She also added a Medical Report dated 28 August 2020 which mentioned a 2-month record of illness.

I have been asked to inquire into this claim for Unfair Dismissal arising from selection for Redundancy in July 2020 . In  reaching my decision , I have considered all oral and written submissions in conjunction with the evidence adduced at hearing .

I have found that the case may have benefitted from the presence of the Proprietor at hearing to reflect the circumstances which prevailed within the operational climate for the business . I appreciate that Mr A was proximate to the business during the period referred to in the case , but he not a direct employee , nor did he carry  day to day operational management responsibility .

I requested a DSP record from the complainant covering the calendar years   2020 and 2021 . I received a record dated July 1 2020 to May 2021, which fell short of my request and demonstrated a cumulative award of €9373.00 made up from PUP , Illness Benefit and Job Seekers benefit . The Complainant did not submit any further records of DSP benefits .

The claim is  for unfair dismissal , unfair selection for redundancy . The claim has been strongly contested by the respondent representative .

The law on unfair dismissal is  provided in Section 6 (1) of the Act

Unfair dismissal.

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.

(2) 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, to be an unfair dismissal if it results wholly or mainly from one or more of the following:

Section 6(3) of the Act provides

 (3) Without prejudice to the generality of subsection (1) of this section, if an employee was dismissed due to redundancy but the circumstances constituting the redundancy applied equally to one or more other employees in similar employment with the same employer who have not been dismissed, and either—

( a) the selection of that employee for dismissal resulted wholly or mainly from one or more of the matters specified in subsection (2) of this section or another matter that would not be a ground justifying dismissal, or

( b) he was selected for dismissal in contravention of a procedure (being a procedure that has been agreed upon by or on behalf of the employer and by the employee or a trade union, or an excepted body under the Trade Union Acts, 1941 and 1971, representing him or has been established by the custom and practice of the employment concerned) relating to redundancy and there were no special reasons justifying a departure from that procedure,

then the dismissal shall be deemed, for the purposes of this Act, to be an unfair dismissal.

Section 6(4)(c) of the Act recognises that a dismissal arising wholly or mainly from Redundancy can be concluded as a fair dismissal .

However , the Act places the burden of proof on the Respondent to demonstrate a genuine redundancy , followed by a fair selection and a reasonable approach to the employee in question .

This is necessary to uphold the protections  afforded by the Unfair Dismissals Act, 1977.

 In St Leger V Frontline Distributors Ireland ltd [1995] ELR 160,  Dermot Mc Carthy ,SC , in his capacity as  Chair , stressed that impersonality runs through the 5 definitions of Redundancy in Section 7(2) of the Redundancy Payments Act, 1967, as amended. Impersonality and Change are, therefore  the fundamental cornerstones of a Redundancy .

 In  the High Court case of JVC Europe ltd and Jerome Panisi [2011] IEHC 279, Justice Charleton added a psychological framework to a  Redundancy situation.

Redundancy can be a devastating blow. Where economic conditions are difficult, or where the employee who is let go has aged or is experiencing health difficulties, finding alternative employment may be impossible. Years of devotion to an employer count for nothing where technology overtakes the workforce, rendering the labour of those displaced unnecessary, where new methods of work are demanded from those who do not have the skills to respond, or where the product is deemed obsolete. All these are examples of a genuine redundancy. As ordinarily understood, redundancy means that a worker is no longer needed.

Justice  Charleton qualifies the objectivity necessary in a Redundancy which draws from the seminal case of  St Leger V Frontline Distributors Ireland ltd [1995] ELR 160

Redundancy is not, however, a personal choice. It is the external or internal economic or technological reorienting of an enterprise, whereby the work of employees needs to be shed or to be carried out in an entirely different manner. As such, redundancy is entirely impersonal.

In Panisi , Charleton J held that the Company had used Redundancy as a cloak or cover  for a  dismissal  which collided with the protections afforded by the Unfair Dismissals Act .

In the instant case , I was mindful that the claim came before the WRC some 8 days post dismissal, which I determine to have occurred on 21 July 2020, by electronic means .

I found this to be very rushed and it did not take account of any local engagement following the dismissal through dialogue or appeal of the decision .

I have reflected on the complainants evidence and accept that sadly , she experienced a challenging pattern of personal bereavements in 2020 . The Complainant had ceased work in March 2020 and was supported by PUP . This indicated that she had an expectation  that the business would re-open and she would be a part of that process . I accept that she was making preparations  for her return  to work when further news of bereavement unfolded in June 2021. I have read the text when reflected the communication of the bereavement to the Proprietor on June 24 . This text carried the important line . “ …..So I don’t know when Im able to come back to Ireland “

The Complainant gave evidence that she returned to Ireland on 5 July , but she did not submit any material evidence of this as her applications  for benefits were made online . She did submit medical certificates  for that period . The Respondent took exception that these documents were not shared with the respondent . I accept that the complainant was bound by Section 6 of her contract from June 29 onwards , when the Salon had re-opened .

 For me , it goes to the root of this case that neither party managed the complainants absence from the business until the decision was made to make her redundant some three weeks later . It was a case of “ out of sight , out of mind “

I requested and reviewed the email generated by the complainant on 16 July 2020 which confirmed the cessation of her PUP payment and her seeking 3 days compassionate leave . It made no reference to her presence in the country or intentions surrounding a return to work and for me stood in stark contrast to the precision  contained of the medical notes .

I appreciate that re-opening of a business into the cautious post lock down world  was bound to be challenging , but the complainant was in the second year of her employment the business was a member of staff down .

I must disregard the complainants submissions that the Proprietor disliked her as she did not advance any proof of this and acknowledged that this was indeed beyond her grasp .

I have considered the sequencing of  DSP payments relied on in the complainants evidence and accept that she received job seekers benefit once her illness benefit ceased . The Complainant did not lead Medical evidence on her reported psychological effects of dismissal against a climate of personal loss . However, I accept that she experienced a high level of shock on reading the notice of her dismissal .

I note that the complainant told the hearing that she spent €100 on equipment to support the business re-opening . She did not seek a refund of this amount .

I was struck by the complainants lack of effort to get her job back at the business and even more struck by her failure to mitigate her loss following dismissal . While she spoke about pursuing 3 jobs, I did not submit any cogent details of these positions .

I have drawn inferences in the curtailment of DSP records to May 2021 and not the requested date of August 2021 . The Respondent made repeated submissions that the complainant was undertaking private employment . I cannot determine this on the evidence before me .

I move now to considering the actions of the Respondent in the case .

I must first decide if the Redundancy dated 21 July 2020 amounted to a Genuine Redundancy . As stated , I did not have the benefit of direct evidence from the Proprietor. In a recent Labour Court case in Tanneron ltd v Gerrard Conolin  UDD 2151 , the Court engaged in a deep inquiry into the circumstances of dismissal . This was a case where bank statements and Accounts were exhibited . This was also a case where psychological trauma was pleaded .

I have considered Mr As evidence and note that I have not found  evidence from which I can  decide that a genuine redundancy took place . Instead , I saw a business struggling to re-open and concurrently reaching out for state supports to pro long that re-opening . I did not find any limitations  or restrictions advised on state supports so as to prompt redundancies .

Given that the complainant had advised the business of her absence through bereavement on June 24 ,  and sought compassionate leave on July 16 , I could not identify just how she was placed on a list for consideration  for redundancy some 10 days later . I have not received any documentation  from which I can infer a climate of redundancy naturally evolved .

I found that the Respondent erred in their management of the complainants absence . A contract of employment is built on mutuality of obligation and the respondent had a responsibility to follow up on the complainants absence short of her being placed on a list of two for redundancy .

Taking all the circumstances into account , this was not a genuine redundancy .

I move next to consideration of the selection process . I was informed that the business had no organisational memory of redundancy and endeavoured to identify a  selection process deemed to be fair and reasonable .

As I have already alluded to in my opening comments , Redundancy is  built on impersonality and change and the selection criteria much be constructed and applied in a fair and impartial  and objective manner .

I did not have the benefit of the markings  which led to the declaration   of Redundancy , with immediate effect  . I note that the letter received by the complainant carried the following :

“ …. It is with much regret that I am writing to you to advise you that , as a consequence of the new arrangements brought about by covid 19 crisis , we are unable to continue employing you and you are therefore making you redundant

We cannot physically service as many clients as we did before the crisis   as a result of the social distancing measures we have had to introduce ………”

There was no connection made between the matrices relied on and this letter . There was  no mention of a second redundancy at the business . There was no mention of an attempt at engagement, discussion or debate . There was no mention of measures considered short of redundancy . Yet, the respondent had access to the complainants phone and email .

In applying what the reasonable man/woman in the street might think of this letter having experienced a significant bereavement , I can only conclude they would be confused  and very hurt . For me , I found a significant breach in the employers duty of care towards an employee .

The selection criteria relied on at hearing were neither objective or impersonal and at their height could be viewed as discriminatory vis a vis part time / full time status .

However , I was disturbed at the reference to availability for work as a deciding matrix . I cannot determine what steps , if any the employer took to assess this matrix .

In the absence of a transparent document which logged the construction and  application of the reported matrices to the two employees made redundant , I must conclude that these matrices existed for reference purposes rather than actual application in substance .

I have been drawn to the very expansive judgement in the Labour Court case in

Kohinoor ltd and Hussain Ali UDD 1629, where Deputy Chair Jenkinson in assessing a redundancy situation, held the following were important determinants in reaching a decision that a Redundancy was justified in the case.

1 Respondent decided to carry on with fewer employees

2 Qualitative changes 34 reduced to 31 employees

3 Matrix   developed on external advice to include essential elements required to meet the future needs of the business

4 Consultation and given an opportunity to have input into the scoring

5 Availability of an appeal

6 No knowledge of prior grievances 2008-2014

7. Selection criteria applied equally

In this case , the Court denied the claim but left a definitive blue print of what might constitute a bona fide Redundancy .I appreciate that the Respondent made the case that the business satisfied the first three criteria , however , compliance with the remainder would have been preferred in this instance .

I have found that the Respondent has not satisfied the burden of proof for fair selection for redundancy .

Finally , I must look at the reasonableness of the actions of the respondent towards the complainant.

Here , I have had regard for the pressing nature of the re-opening of the business in June 2020 and I do not underestimate the apprehension and uncertainty which accompanied that time . However , the Respondent did not act reasonably when they made the Complainant Redundant . No visible measures were taken to avoid redundancy either through scoping out lesser measures to dismissal or inclusion in the states support mechanism which was meant to “ leave no one behind” .

I have found that the Respondent erred when they allowed the complainants “ out of sight , out of mind “ status to frame her inclusion for redundancy and for me, they then made the fatal step of conducting a redundancy where the named person was in abstentia .These  were no fair procedures and amounted to  an unreasonable  approach .

I have found that there was a certain vulnerability around the complainant in late June /early July , 2020 . She did not reach out to her then employer and neither did the employer reach out to her . I accept that the respondent did not pay sick leave , but there were clear rules in the contract which obligated both parties to maintain contact and manage absence at work .

I found that the Respondent erred significantly in the conducting of this dismissal , which was not a genuine redundancy built on object and impartial criteria , nor was it conducted in a reasonable manner .

I have had regard for the respondent argument that the business was operating in an emergency period and that what occurred were decisions made in the best interest of the business and were both necessary and proportionate .

I accept that the business was operating in a Special period , however , the protections of the Unfair Dismissals Act were not varied or estopped and the complainant deserved a seat at the table of her own dismissal and I conclude that it open to the Respondent to effect that communication virtually which was the prevailing method of communication at that time .

I find that the complainant was unfairly dismissed .

Section 7 provides for a remedy in the case of a claim succeeding for unfair dismissal . The Complainant’s stated preference is for compensation .

I did spend some time considering whether an order of re-engagement would assist the parties and I find that compensation is the only veritable and practical solution open to me . However , that brings me to consider the complainants financial loss and the measures she has taken to bridge that loss through mitigation .

A long line of case law has indicated that the complainant in a claim for unfair dismissal is obliged to look for work on a daily basis and be able to demonstrate that at hearing .

I have not received a satisfactory account of mitigation  from the complainant .  I would have expected documented proof to find work .

This omission has a direct impact on the compensation open to me in this case .

The EAT considered the procedural framework surrounding a Redundancy in Gerard Mulqueen v Prometric Ireland ltd UD 1259/2012

The Tribunal carefully considered the oral and documentary evidence adduced at the hearing. The Tribunal considers that the procedures used to effect the claimant’s dismissal by way of redundancy were flawed. In particular the Tribunal notes that on 17 May 2012 the claimant was requested to attend a meeting where the gravity of the company’s financial position was outlined. The company then informed the claimant that his position along with two other employees was to be made redundant and in so doing produced a matrix that was adopted by the company to effect the redundancies. The claimant had no previous knowledge of the content of the matrix, its significance or its implications for his continuing employment. He was given no opportunity to examine, query or object to the matrix.

In this case , the EAT emphasised how the procedural framework deviated sharply from a best practice model .

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.

I have found that the Complainant was unfairly dismissed when she was unfairly selected for Redundancy on 21 July , 2020 .

I order the Respondent to pay the complainant €7,400 , 20 weeks pay as just and equitable compensation for the unfair dismissal .

I would also encourage the Respondent to formulate a Redundancy Policy and circulate this within the workforce .