Complainant

Respondent

Anonymised Parties

{A Pharmacist}

{A Company}

Representatives

Anne O'Connell Anne O'Connell Solicitors

Terry MacNamara TO ISSUE BY EMAIL TO: cases@ibec.ie

Act

Complaint/Dispute Reference No.

Date of Receipt

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

CA-00027694-001

12/04/2019

Complaint seeking adjudication by the Workplace Relations Commission under Section 28 of the Safety, Health & Welfare at Work Act, 2005

CA-00027694-002

12/04/2019

The Complainant is a Pharmacist and was employed as a General Manager with the Respondent from 30th August 1999 until her resignation on 17th October 2018.

CA-00027694-001

The Complainant claims she was constructively dismissed by her employer. By letter of 12th March 2018 she raised health and safety concerns and was penalised for making a complaint under the Safety Health and Welfare at Work Act 2005. The Complainant was left with no other option but to resign from her employment due to fundamental breaches to her contract and breakdown of the relationship of trust and confidence with her employer.

The Complainant was initially employed as a Pharmacist and was promoted to General Manager in May 2005. The business provides pharmacy services. She had an excellent relationship with senior management. The business was taken over by the Respondent on 8th September 2017.

The Complainant was subjected to disrespectful, undermining and isolating behaviour by two new Directors after the takeover. This included comments that they were very surprised to see the Complainant and three other colleagues were still employed. This was coupled with repeated comments about the payroll and business costs being too high. From October 2017, monthly management accounts and financial information was no longer provided to her. She repeatedly requested these to inform her decision making but they were never provided. This caused her stress as the Complainant could not deal with queries on the figures from the Directors.

The Complainant was stripped of almost all of her reports down to 6 without consultation. She found out at a Managers day on 6th February 2018 when all management were told they would not have more than 8 people to manage. One of the Pharmacy Managers began to report to a Director instead. The Complainant became alarmed at the change in culture, use of bad language, and workplace games. From 7th February 2018 onwards, only the Pharmacy Manager Dublin reported to the Complainant as the Director asked all the others to report to him or the Finance Director.

The Complainant was excluded from recruitment for which she was previously responsible. She was side-lined, excessively monitored and second guessed. There were weekly review procedures imposed, to do points to be sent by her to the Director every evening, even though appointments were diarised centrally. This was excessive and demonstrated a lack of trust. There were no issues with her performance.

The Respondent was distrustful and unreasonable. For example, when weather was deteriorating in Storm Ophelia and a national weather warning was in place, the Director refused to accept the Complainant’s word, said there was no snow and demanded pictures.

The Complainant sent a letter to the Respondent outlining a number of concerns on 12th March 2018 regarding health and safety, breach of employee rights, exclusion from recruitment, and low staff morale since the takeover. The Complainant met the Director on 14th March 2018 and there was discussion of the issues. However, the complaint was not constructive and the situation deteriorated.

The Director maintained he was unaware of the Complainant’s involvement in recruitment and her exclusion was an oversight. No action was taken to address it and the Complainant remained excluded. The Director was reluctant to involve her in decision making, but then she would be called in to resolve problems that arose for example in relation to a manager. The Complainant could not get health and safety issues addressed for example the air conditioning unit in Dublin was not functioning for months and a fire corridor being used as a storage area. She was not informed when a number of senior managers departed. All of which undermined her further in front of staff.

A number of incidents took place in August 2018, when the Directors came to Dublin and met staff. The Directors sought to dismiss a member of staff without complying with proper procedures. The Complainant raised concerns about this. She was accused of gross misconduct and treated in a disrespectful, undermining manner in meeting. The Complainant was extremely stressed and had difficulty sleeping. She lodged a grievance on 28th August 2018 addressed to the Chairman of the Board of Directors. The Complainant agreed to participate in mediation which was unsuccessful.

Her grievance was investigated by an external organisation. However, the treatment by the Respondent continued. The investigation report issued on 10th October 2018. It dismissed every aspect of the grievance and was a whitewash. The Complainant submitted her comments on the report, and indicated unless the issue was properly resolved she would have no option but to resign. On 17th October 2018, the Complainant was notified of the decision of the Chairman of the Board to accept the outcome of the report and conclude the process. There were no proposals to resolve the issues. The Complainant’s contract was fundamentally breached, and the situation was untenable. The Complainant was left with no reasonable alternative but to resign.

The Complainant submits her contract was fundamentally breached by the Respondents actions in removal of her responsibilities and behaviour which repeatedly breached the implied duty of trust and confidence owed to her. In addition, the behaviour of the Respondent was so unreasonable for over one year that she could not be expected to put up with this which satisfies the objective test outlined by the Supreme Court in Berber v Dunnes Stores [2009] 20 ELR 61. The Complainant acted reasonably and continued to work despite the behaviour of the Respondent.

CA-00027694-002

The Complainant raised health and safety complaints by letter of 12th March 2018 and complains she has also been penalised by the company pursuant to S27 of the Safety Health and Welfare at Work Act 2005. By August 2018 the behaviour was having a severe impact on her health, which is a contravention of her right to a safe place and system of work.

The Complainant submits her letter of 12th March 2018 and grievance of 24th August 2018 come within the Act and the Respondent penalised her:

by a campaign of undermining, isolating and intimidating behaviour, and the reaction of the Respondent to her grievance

by isolating her at the Manager’s meeting in August

by using mediation as a mechanism to further mistreat her

isolating and intimidation following her grievance being lodged, withdrawing normal communication and behaving unreasonably and aggressively

escalating the treatment after the grievance was lodged and continuing to make changes to the business without informing or consulting the Complainant.

CA-00027694-001

The Respondent dispute the fact of dismissal and says the Complainant resigned voluntarily, denies breaching her contract and acting unreasonably. The Respondent robustly rejects the allegation that the Complainant was penalised for complying with or making a complaint under the Safety Health and Welfare at Work Act 2005.

The Respondent is a progressive pharmacy group with a large number of stores throughout Ireland and also provides pharmacy services. The company purchased the business employing the Complainant which focuses on the long-term care market in 2017. At the time the new business had 78 employees. The Complainant had been employed by the business taken over since 30th August 1999. There is a contract of employment with the Complainant from 28th July 1999, and a letter confirming her promotion to Pharmacy Manager dated 21st September 2000. The Respondent had not seen the contract of employment produced by the Complainant. An organisational chart given to the new owners provided limited information on the Complainant’s role.

The Respondent says that the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003 does not apply to the share sale of the company.

The business employing the Complainant made a substantial loss in 2017. There was also a write off of company debt in 2016, contradicting the Complainant’s submission that the business was profitable and successful. The new owner has taken over a number of businesses. There was a requirement to create an integration plan, so the team understood its responsibilities in the new entity. A Director met the Complainant in October 2017 and confirmed her contract would be honoured.

The Respondent denies the subjective allegations of the Complainant. The first time the allegations were brought to the attention of the Complainant was when they received the letter of 12th March 2018. There is no mention in the letter of the allegations of disrespectful, undermining and isolating behaviour and failure to provide key financial information.

The integration process involved the adoption of the LION system in February 2018 to improve communication and focus. All managers were required to complete this on a weekly basis and email it to a Director who followed up with a call. The Respondent met the Complainant to discuss her letter on 14th March 2018, and the Complainant followed up with an email summarising what was discussed and agreed. The Respondent understood the issues were resolved and no further issues were raised until 5 months later on 24th August 2018.

The Respondent submits the Complainant had 3 direct reports not 70 and in total 53 reports not 8 following the change in reporting structure in February 2018. The issue was assigning control measures to senior management and was not a diminution of the Complainant’s role. She still held responsibility for 80% of total revenue of the business in Dublin. The Respondent wanted her to concentrate and grow this area. Again, this was not raised in the letter of 12th March 2018 or grievance of 24th August 2018.

The “Getting Shit Done” process is a business concept introduced with LION, and a maximum number of 8 direct reports as a result of a coaching seminar attended by the Directors. GSD is an acronym and was not used in a derogatory manner. LION is being used by senior management currently. It was not mentioned in the complaint letters.

The Complainant did not object to the Chinese whispers game at the time. The seating arrangements for the managers day had been allocated in advance and were posted on the door of the room. The Respondent allocated managers from different stores at tables to get to know each other, and the 4 managers from Dublin were split up. As the Complainant was late to the meeting, she had to sit on a chair with her back to the top table.

The HR function is centralised for the group at head office. Recruitment for all stores is arranged by HR who contact the relevant manager to review and the HR department organises the interview for the manager. The Respondent produced 15 emails between HR and the Complainant in relation to recruitment. While the Complainant was on annual leave a manager handed in her notice. This was a great concern to the Respondent as the manager had been employed for 10 years, and so offered her the role of Pharmacy Manager. It was an urgent commercial decision. The Complainant was not part of the process as she was on leave.

The Complainant alleges breaches of employee rights which is incorrect. Terms and conditions of staff were standardised after the takeover to control costs and integrate the business. The Complainant is incorrect when she alleges breaks given to new pharmacists are in breach of the Organisation of Working Time Act 1997 as SI 57/1998 does not apply to pharmacies. There were no illegal deductions. Employees that commenced employment after the takeover are not paid for sick-days. Employees are paid in full on 25th of the month and sick-days are deducted the following month.

The company had a duty to remain open where possible during Storm Ophelia as a healthcare provider. The Respondent explained his disappointment regarding the store closing from 28 February 2018 at 8pm to Friday 2nd March 12 pm. This issue was resolved at the meeting on 14th March 2018. The air conditioning unit was broken and cost to repair was €50,000. This was always an issue. It was a significant outlay. A temporary machine was installed and it took 6 weeks to install a new unit. The Complainant alleges a fire corridor was used as a storage area. The storage cage was blocking patients view of the pharmacy. The Respondent requested the Complainant to review the layout of the store and move this to another area. It was never moved by the Complainant.

The Complainant would have been aware of the departure of managers if she joined the weekly manager’s meeting and continued providing her LION reports after August 2018, as there was a follow up call. The Respondent disagrees with comments made regarding dismissal of one of the members of staff. The Complainant had concerns about the performance of the person. She was directed to extend the persons probationary period, however this never occurred.

The Respondent disagrees with the Complainant’s version of events surrounding the dismissal of a manager. It was for financial reasons. The Director did not make an allegation of gross misconduct against the Complainant, but failure to follow a reasonable management instruction can be interpreted as gross misconduct. This conversation has been embellished and portrayed grossly inaccurately. The Complainant was not invited to the meeting, as she did not support the Directors action. The Director sought advice from the Director of HR following the incident, who recommended the issue be discussed with a view to informal resolution. The Director went to meet the Complainant at her office to clear the air, but the Complainant did not want to resolve the issue.

The grievance was dealt with in a timely way. The Directors understood all issues set out in the letter of 12th March 2018 were resolved, as no issues were raised in the interim. The Complainant should have raised issues if they were not resolved. The Respondent does not accept it withdrew all normal communications with the Complainant in August 2018, as there were numerous positive communications in this period. The Directors entered mediation as they wanted to improve working relationships and were very disappointed the Complainant chose to leave before it concluded. They do not accept they used the process to further bully the Complainant.

I have heard and considered the parties oral and written submissions carefully.

Hearings of this complaint took place on 14th October 2019, 30th January 2020 and 22nd April 2021.

The attention of the parties was drawn to implications of the decision of the Supreme Court in Zalewski v Adjudication Officer and others delivered on 6th April 2021 on hearings conducted by the Workplace Relations Commission in relation to the removal of anonymity for the parties and amending legislation which will be enacted to give powers to Adjudication Officers to take evidence on oath where there is a serious conflict of evidence. The parties sought to conclude the hearing prior to the enactment of amending legislation for the Workplace Relations Commission.

The party’s cases were set out in detail in lengthy submissions which were exchanged, with issues of dispute highlighted. Over two days of hearing, I heard oral evidence from a number of witnesses. Subsequently the Respondent business changed ownership.

The Complainant was a Superintendent Pharmacist and General Manager with the Respondent. She was promoted to General Manager in 2005 and had long service with the company prior to her resignation on 17th October 2018. She claims unfair dismissal and constructive dismissal pursuant to Section 6 of the Act due to her effective demotion following sale of the business in September 2017.

The Act defines “dismissal” in relation to an employee as:

“ the termination by the employee of his contract of employment with his employer, whether prior notice of the termination was or was not given to the employer, in circumstances in which, because of the conduct of the employer, the employee was or would have been entitled, or it was or would have been reasonable for the employee, to terminate the contract of employment without giving prior notice of the termination to the employer”.

In a claim of constructive dismissal, the burden of proof lies on an employee to prove on the balance of probabilities that firstly, the employer has breached her contract and as a result the employee is entitled to resign or secondly, that it is reasonable for the employee to resign given the conduct of the employer.

The breach of contract required is “a significant breach going to the root of the contract of employment, or which shows that the employer no longer intends to be bound by one or more of the essential terms of the contract, then the employee is entitled to treat himself as discharged from any other performance“ Western Excavating (ECC ) Ltd -v- Sharp [1978] IRLR 27.

The Complainant submits that under both tests she has satisfied the onus of proof for constructive dismissal due to the conduct of the Respondent.

Following the takeover in September 2017, the Complainant was retained in her position as General Manager of the business which became part of a larger pharmacy group. In the takeover due diligence, the Complainant was described as responsible for the overall day to day running of the business for the new owners. There is dispute regarding the exact terms of the Complainant’s contract of employment as General Manager. The Human Resources and Finance function were centralised in the new group. The Respondent had concerns about profitability and cost of the business employing the Complainant following the takeover which were evidenced at the hearing.

The Complainant says she no longer had access to the monthly management accounts after the takeover. She managed 70 people, was stripped of these reports and left with one direct report on 6th February 2018. The Respondent says the change resulted in the Complainant having 53 reports not 8 reports. The change was announced at a manager’s day, there was no discussion with the Complainant in advance. She also discovered the Pharmacy Manager for a substantial part of the business in Cork was no longer reporting directly to her, although she was legally responsible for the Cork business as Superintendent Pharmacist.

The Respondent maintains this was part of the business integration plan. The reporting changes applied to all management and was part of a process to improve communication. Other senior members of management including Finance Director, Area Manager, Sales and Operations Manager, Marketing Manager and HR Manager left within a period of 12 months of the takeover.

The Complainant gave evidence that she was never informed of any integration plan. On 12th March 2018 she outlined concerns by email to the Managing Director in relation to the terms of staff, health and safety, and exclusion from recruitment for the business she manages and their reporting structure. She met with the Managing Director on 14th March 2018. He said he was unaware of the Complainant’s responsibility for recruitment and this oversight would be addressed. However, she maintains this did not occur and she continued to be excluded from recruitment. This is disputed by the Respondent who provided emails confirming the Complainants involvement in recruitment from March to August 2018.

The Complainant complains that she was micromanaged and over monitored with daily to do lists and weekly reports suitable for more junior staff, without any reason. The Managing Director was unreasonable and angry over early closure due to weather concerns.  The Complainant gave evidence she felt undermined by not being able to address internal issues such as air conditioning, and not being informed of the departure of senior staff.

In August 2018, the Complainant and her colleague were informed one of the Pharmacists was to be dismissed immediately. The Claimant disagreed and said the Pharmacist’s performance should be reviewed and given an opportunity to improve. She tried to convince the Managing Directors to review performance rather than dismiss. She objected to attending the meeting as she felt it was  wrong. The Complainant says she was accused of gross misconduct by a Managing Director.

The Respondent says there was an issue with the Pharmacists performance, they thought this was being managed by the Complainant and the Pharmacist’s probation extended. It was in this context the Pharmacist’s contract was being terminated.  The Managing Director denied accusing the Complainant of gross misconduct but pointed out that failure to follow reasonable management instruction can be interpreted as gross misconduct.

The Complainant submitted a written grievance on 24th August 2018. Mediation was unsuccessful. The grievance was subsequently investigated by an external investigator, but none of the Complainant’s grievances were upheld.

I accept the evidence of the Complainant that she was accused of gross misconduct by the Managing Director. I find the Complainant is a credible witness and is consistent and clear in her evidence. This caused her significant upset and stress. It was an implied term of the Complainant’s contract that both the Complainant and Respondent would maintain mutual trust and confidence. This test is an objective one set out by the Supreme Court in Berber v Dunnes Stores Limited [2009] 20 ELR 61. The conduct of the Managing Director breached the relationship of trust and confidence between the parties.

There were other incidents of concern which had resulted in an undermining and diminution of the Complainant’s senior position in the company, including a very significant reduction in the Complainant’s management reports in February 2018. There was little one to one discussion of the changes or strategy for integration between the Directors and Complainant which may have reassured her in the transition. The Complainant lodged a grievance, but it was not resolved through the procedure. She outlined her dissatisfaction with the findings of the investigation to the company but there was no further attempt to address the issues.

I find the Complainant was unfairly dismissed. Two Directors of the Respondent involved in the management at the time the Complainant was employed are no longer in the business and were not available for cross-examination. I have admitted the Respondent Director’s evidence but prefer the evidence of the Complainant.

The Complainant seeks compensation by way of redress. She resigned on 17th October 2018. She commenced other employment as a Pharmacist immediately but on a significantly lesser salary, notwithstanding her experience and has not obtained a position at a comparable level. There is ongoing loss of earnings. Taking into account evidence given in relation to mitigation, it is just and equitable that she be awarded €75,000 for financial loss and I direct payment by the Respondent.

CA-00027694-002

The Complainant has made a complaint of penalisation by the Respondent pursuant to S27 of the Safety Health & Welfare at Work Act 2005.

The Complainant claims she was penalised as a result of her health and safety complaint on 12th March 2018. She says her work situation deteriorated significantly after that letter. She was having severe difficulty sleeping as a result of her treatment and lodged a grievance on 24th August 2018, which caused the situation to deteriorate further. She was subjected to a campaign of undermining, isolating and intimidating behaviour. The Respondent reacted by isolating her, withdrawing normal communication, making more changes to the business without informing or consulting with her as General Manager.

The Respondent submits that S27 of the Safety Health & Welfare at Work Act 2005 offers protection for employees who claim detriment from their employer in retaliation for exercising their rights under health & safety legislation. The Respondent says it understood the Complainant’s health and safety complaints were resolved following a meeting on 14th March 2018 as there was no mention of these afterwards. In the grievance letter of 24th August 2018, the Complainant raised health and safety issues regarding air conditioning and fire safety.

The Respondent relies on the Labour Court ruling in Toni & Guy Blackrock v Paul O’ Neill [2010] ELR 21 and the test that “but for the Complainant having committed the protected act he or she would not have suffered the detriment”. The Complainant complains her detrimental treatment began immediately after takeover. In order to amount to penalisation, the employer must have imposed separate detriment on the employee. The Respondent submits any allegation of withdrawal of normal communication, isolating and intimidating behaviour are unfounded. In fact, the Complainant withdrew from communication and refused to attend meetings or send reports requested.

The Complainant submits she was subjected to disrespectful, undermining and isolating behaviour by management following the takeover in September 2017. She says the situation deteriorated following her letter of 12th March 2018 with extremely isolating, undermining and intimidating behaviour including failure to fix air conditioning and fire safety.

I take cognisance of the Labour Court decision in St. John’s National School v Akduman (HSD 2010) where the Court found delay in investigating a complaint of bullying and its continuance after the complaint could not amount to penalisation, as the alleged conduct was initiated before the complaint was made. I find there was no causal link between the conduct the subject of the Complainant’s complaint which was initiated prior to her complaints and continued after. There is no evidence of separate detriment resulting from the health and safety complaints. The complaint of penalisation is not well founded.

CA-00027694-001

The Complainant was unfairly dismissed. Taking into account evidence given in relation to mitigation, it is just and equitable that she be awarded €75,000 for financial loss and I direct payment by the Respondent.

CA-00027694-002

The complaint is not well founded.

Constructive dismissal, test for breach of contract, striking out testimony in the absence of cross-examination, penalisation