Complainant

Respondent

Parties

Vaclava  Zuckova

Ballyleague Mushrooms Limited

Representatives

Richard Stapleton Richard Stapleton Solicitors

Thomas Ryan Peninsula

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-00042177-001

27/01/2021

The claimant was employed as a Mushroom Harvestor from the 20th.Aug.2007 to the 14th.February 2020 when it was submitted his employment was terminated by reason of redundancy . The complainant  asserts that the respondent is in breach of the Act for failing to pay him statutory redundancy .The respondent rejects the complaint  and contends that the redundancy constituted a collective and compulsory redundancy , that the conditions of the workers who replaced the claimant and her colleagues  were inferior and that as a consequence the claimant had no remedy under the Act.In the alternative the respondent submitted that the offer of re-engagement made by the respondent was unreasonably declined by him.

It was submitted by the claimant’s representative that as per the RP50 form completed by the complainant , the complainant received notice of the tertmination of his employment by reason of redundancy on the 6th.Jan. 2020 with a termination date of the 14th.Feb. 2020.The RP50 confirmed that the claimant had 8.26 years of service with a statutory redundancy entitlement of €8,103.74.It was submitted that the respondent refused , neglected and/or omitted to discharge the complainant’s redundancy entitlement .It was advanced that the WRC had already upheld similar complaints made by the claimants colleague harvesters.It was submitted that the respondent had failed to meet the statutory time frame with respect to their offer of alternative employment.It was contended that the respondent was happy to make the claimant redundant in February 2020 , that an alternative offer of employment was not made until the end of May 2020- it was advanced that this was done to avoid paying the claimant his statutory entitlement .

The respondent’s representative submitted as follows :

 Employment Commenced: 20.Aug  2007

Pay: €€313.36gross weekly

Employment Ceased: 14 February 2020

Respondent Representative: Thomas Ryan, Peninsula

Introduction

1.      Mr. Vaclava Zuckova  (hereinafter referred to as “the Claimant”) commenced employment on 20th.Aug.2007

2.      He was a Harvester with Ballyleague Mushrooms (hereinafter referred to as “the Respondent”).

2. The Respondent is a mushroom producer based from Moher, Lanesborough, County Roscommon.

3. The Claimant has lodged the within complaint pursuant to s.39 Redundancy Payments Act 1967.

Facts

4. The Claimant commenced employment with the Respondent on  the 20th.Aug.2007. The Claimant remained employed by the Respondent until they ceased trading on 14 February 2020. During this time, the Claimant maintained an excellent employment record.

5. The Respondent produces mushrooms primarily for the retail market. The Respondent is also reliant on the export market to the United Kingdom.

6. Due to the effects of the departure of the United Kingdom from the European Union, the Respondent suffered a significant reduction in trade and anticipated this effect to escalate in detriment to their operation.

7. On 06 January 2020, the Eugene Kiernan (EK), Director of the Respondent, initiated an information and consultation process. The employees of the Respondent, including the Claimant were represented by Andris Lipstovs (AL), Farm Supervisor of the Respondent. EK met with all employees and informed them of the economic circumstances affecting the Respondent.

8. As part of that meeting, EK offered all employees to transfer to roles within their other farms, Sheelin and Kildorough Mushrooms respectively. However, the Claimant failed to accept this offer.

9. On 14 February 2020 the Claimant was informed that their position was redundant, this was confirmed by way of letter by Mr Conor Kiernan (CK), Director of the Respondent Company. A total of 57 employees of the Respondent Company were made redundant on 14 February 2020.

10. With the onset of the Covid-19 Pandemic in March 2020 the Respondent experienced a significant increase in demand within the retail sector. This was largely due to a reduction in demand in the wholesale (i.e. Catering) sector and an increase in demand in supermarkets.

11. The Respondent wrote to the Claimant on 29 May 2020 informing her that production would be recommencing in June 2020 and that her previous role was available to them.

12. The Claimant failed to take up the invitation to return to work, and rather proceeded with the within complaints pursuant to the Section 39 of the Redundancy Payments Act 1967 which were lodged with the Workplace Relations Commission.

13. The Respondent resumed operations in June 2020 and was required to engage a contractor to satisfy the staffing needs. This arrangement continued until January 2021; at which time the Respondent took the decision to cease operations.

Law

14. s.7 Redundancy Payment Act 1967 (as amended) provides: (1) An employee, if he is dismissed by his employer by reason of redundancy or is laid off or kept on short-time for the minimum period, shall, subject to this Act, be entitled to the payment of moneys which shall be known (and are in this Act referred to) as redundancy payment provided— (a) he has been employed for the requisite period, and

(b) he was an employed contributor in employment which was insurable for all benefits under the Social Welfare Acts, 1952 to 1966, immediately before the date of the termination of his employment, or had ceased to be ordinarily employed in employment which was so insurable in the period of four years ending on that date.

15. A redundancy occurs in circumstances as set out in s.7(2) 1967 Act:

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 particular 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[.]

16. However, s.7(2A) 1967 Act (as amended) provides: (a) the dismissal is one of a number of dismissals that, together, constitute collective redundancies as defined in section 6 of the Protection of Employment Act 1977,

(b) the dismissals concerned were effected on a compulsory basis,

(c) the dismissed employees were, or are to be, replaced, at the same location or elsewhere in the State, (except where the employer has an existing operation with established terms and conditions) by—

For the purposes of subsection (1), an employee who is dismissed shall be taken not to be dismissed by reason of redundancy if—

(i) other persons who are, or are to be, directly employed by the employer, or

(ii) other persons whose services are, or are to be, provided to that employer in pursuance of other arrangements,

(d) those other persons perform, or are to perform, essentially the same functions as the dismissed employees, and

(e) the terms and conditions of employment of those other persons are, or are to be, materially inferior to those of the dismissed employees.

17. Section 6 1977 Act provides: (a) at least 5 in an establishment normally employing more than 20 and less than 50 employees,

(b) at least 10 in an establishment normally employing at least 50 but less than 100 employees,

(c) at least ten per cent. of the number of employees in an establishment normally employing at least 100 but less than 300 employees, and

(d) at least 30 in an establishment normally employing 300 or more employees.

(1) For the purpose of this Act, ‘collective redundancies’ means dismissals effected by an employer for one or more reasons not related to the individual concerned where in any period of 30 consecutive days the number of such dismissals is —

18. All 57 employees of the Respondent were made redundant in February 2020, including the Claimant. This constitutes a collective redundancy within the meaning of and satisfying the requirement of s.6(1)(b) 1977 Act and therefore also s.7(2A)(a) 1967 Act.

19. The Claimant’s dismissal and the dismissal of 56 of her Colleagues on 14 February 2020 were on a compulsory basis by way of the Respondent’s Operation ceasing trade, thus satisfying the requirements of s.7(2A)(b) 1967 Act.

20. Moreover, when the Respondent decided to resume operations and offered the Claimant their position back, owing to the fact the Claimant declined such offer, the Respondent had to engage the services of other persons to satisfy their staffing needs, whose services were provided to that Respondent in pursuance of other arrangements in satisfaction of s.7(2A)(c)(ii) 1967 Act.

21. s.7(2A)(c) 1967 Act (as amended) provides:

the dismissed employees were, or are to be, replaced, at the same location or elsewhere in the State, (except where the employer has an existing operation with established terms and conditions) by—

22. It is of note that the Respondent operates several plants. This complies with the exclusion in the above section and therefore the requirements of s.7(2A)(c), (d) and (e) are not necessary to comply with s.7(2A).

23. Those workers who replaced the dismissed employees performed essentially the same tasks as the Claimant in satisfaction of s.7(2A)(d) 1967 Act.

24. The terms of employment of the workers who replaced the dismissed employees were materially inferior to those of the Respondent in that they were not engaged as employees by the Respondent. This satisfies the requirement of s.7(2A)(e) 1967 Act.

25. Accordingly, the Claimant is not a person to whom s.7 Redundancy Payments Act 1967 applies.

26. In the alternative, should the above not be accepted, the Respondent respectively refers to Section 15 (2), which reads as follows –

(2) An employee […] shall not be entitled to a redundancy payment if […]

(a) his employer has made to him in writing an offer to renew the employee's contract of employment or to re-engage him under a new contract of employment,

(b) the provisions of the contract as renewed, or of the new contract, as to the capacity and place in which he would be employed and as to the other terms and conditions of his employment would differ wholly or in part from the corresponding provisions of his contract in force immediately before [the termination of his contract].

(c) the offer constitutes an offer of suitable employment in relation to the employee,

(d) the renewal or re-engagement would take effect not later than four weeks after the date of [the termination of his contract], and

(e) he has unreasonably refused the offer.

27. The Respondent refers most notably to subsections (d) and (e) as above. Although the Respondent’s offer of re-engagement came outside of the statutory time frame, mainly due to the uncertainty of trade due to covid-19, but was nevertheless a genuine offer, one that was unreasonably declined.

28. The Claimant’s claim for pay pursuant to s.39 1967 Act should be dismissed.

Conclusion

29. The Claimant has brought a claim pursuant to s.39 1967 Act.

30. The Claimant is excluded from the protection of the 1967 Act by operation of s.7(2A) 1967 Act (as amended).

31. The within claim should be dismissed.

32. The Respondent reserves the right to adduce further submissions at the hearing of the matters

. The respondent’s representative confirmed that the company was still a registered company and that they were still seeking to recruit workers for their Roscommon plant. The respondent clarified that the company did not advise the Minister for Enterprise , Trade and Employment of the collective redundancy as required under the Protection of Employment Acts 1977-2014.

I have reviewed the evidence presented at the hearing and noted the respective positions of the parties .The respondent confirmed in writing  on the 14th.February 2020  that the claimant’s position was made redundant on the 14th.February 2020 and  confirmed the end of employment as the 14th.Feb.2020.I am satisfied on the basis of the  documentary evidence presented and the submissions of both parties that this was a genuine redundancy situation arising from the downfall in trade owing  to the departure of the UK from the European Union. I cannot accept the respondent’s argument that the claimant’s dismissal arising from redundancy on the foregoing date can be changed by subsequent events.This was not a lay off and the employment was terminated.The intended effect of Section 7(2A) – which is being invoked by the respondent – was enacted to deal with situations in which collective redundancies were effected so as to replace workers with others on inferior terms and allow a remedy for such eventualities under the Unfair Dismissals Acts 1922-2017.In this case , at the time the claimant was dismissed on the 14th.February 2020 , the claimant was not dismissed for the purpose of facilitating the employment of others on inferior conditions – rather because of trading challenges arising from Brexit.The resumption of commercial activity did not surface until 3.5 months later. Accordingly I find that what occurred here does not come within the intendment of Section 7(2A) of the Act .

Additionally ,  I reject the relevance of the employer’s offer of alternative employment given the respondent’s confirmation that it was made outside of the statutory time frame.

Decision:

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.

Redundancy / collective redundancy / compulsory redundancy