Complainant

Respondent

Parties

Sean  Fitzgerald

Wallace Myers International

Representatives

Ken Stafford                                        Management Consultancy Services

 Ken Harbourne Managing Director

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-00038757-001

14/07/2020

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

CA-00038757-002

14/07/2020

This matter was heard by way of remote hearing pursuant to the Civil Law and Criminal Law (miscellaneous Provisions) Act 2020 and SI 359/2020 which said instrument designates the  Workplace Relations Commission as a body empowered to hold remote hearings pursuant to Section 31 of the Principal Act. The said remote hearing was set up by an appointed member of the WRC administrative staff. I am satisfied that no party was prejudiced by having this hearing conducted remotely.  I am also satisfied that I was in a position to fully exercise my functions and I made all relevant inquiries in the usual way.

I can confirm that I explained to the parties the immediate impact that the recent Supreme Court decision in the constitutional case of Zalewski  -v- An Adjudication Officer and the Workplace Relations Commission and Ireland and the Attorney General [2021 ]IESC 24 (delivered on the 6th of April 2021) has had on how WRC hearings must now proceed. In particular, I have indicated that hearings must now (and in the interests of transparency in the administration of Justice) be open to the public. I have additionally informed the parties that in the event that there is a serious and direct conflict in evidence between the parties to a complaint then an oath or affirmation may be required to be administered. In this regard I have explained that emergency legislation is pending which will empower Adjudicators to administer said oath. The parties were happy to proceed in the absence of said oath/affirmation.

The Complainant herein has referred a complaint of having been unfairly dismissed from his employment on the 12th of June 2020 wherein he had worked for in excess of one year. The Workplace Relations Complaint Form (dated the 25th of August 2020) issued within six months of his dismissal.

The Complainant gave comprehensive oral evidence on his own behalf. The complainant was represented and I was provided with a detailed submission and attachments. The Complainant questions the legitimacy and fairness of his redundancy and argues that the implementation of the TWSS amounts to an unlawful deduction under the Payment of Wages Act.

The Respondent argues it applied the TWSS per Government guidelines and made the decision to restructure with the loss of jobs as a cost saving measure in difficult financial times.

I Have carefully considered the evidence adduced in the course of this hearing. The complainant came to work for the Respondent company in April of 2019. The Respondent says that the Complainant was engaged for his Accountancy and Finance experience and there seems to be no question but that the Complainant was engaged on the Accountancy and Finance team for the duration of his employment. The Respondent considers itself to be a specialist recruitment agency and engages consultants (including the Complainant) specifically for their understanding of niche sectors. Each consultant is expected to identify, source, interview and place (with client approval) individuals who have the appropriate skillset as may be required by said client.

I have to accept that a consultant such as the Complainant is engaged by the Respondent company for his or her competency as well as a personal network he or she might have built up in the given field of expertise. Consultants are expected to have a pipeline of contacts which they build and develop in the course of the employment. It was explained to me by the HR and Operations Manager PS, that before the Covid pandemic the Respondent had up to 16 Consultants working for them. In the Accountancy and Finance team there were 4 Consultants each taking seisin of a particular area of employment opportunity placements e.g Accountancy practices, qualified and sub-qualified.

Before the pandemic the Complainant had quarterly targets of €45,000.00. Clients are generally billed when a placement is made, and securing a placement can be a long process of advertising, considering CVs and Interviewing (sometimes three times). I understand payments might only be received some 30 to 60 days after a bill issues to a client. There was, I understand, constant reviewing of targets, and monthly performance management and review though I understand the Complainant’s performance was absolutely satisfactory.

PS gave evidence that the business was badly hit when the pandemic started. The company was not prepared for a directive that sent all the workers home to work. In an immediate response to the situation the company decided to lay-off all the employees. On the 20th of March 2020 each of the 16 consultants was given the RP9 form in recognition of the fact that both lay-off and short time might have to be operated.  PS understood this would allow employees the Minimum Social Welfare rate of circa €203.00 per week. Subsequently the Government put the Temporary Wage Subsidy scheme in place. PS said the company was satisfied that it would qualify for the TWSS relief as it expected to see falling revenues for the company. In effect this allowed the company to reduce wages to €350.00 per week  which monies were provided by the state intervention. Everybody was in the same boat no matter what their Gross salary had been. At the time, the Temporary Wage Subsidy scheme was intended to last until mid-June and the Employer witness told me that the staff were given the option of taking a break and not work  or to continue working at whatever level was still available with a programme of commission and top-ups to operate alongside the state funded TWSS. I understand that within short time even the top-ups dried up as the company’s revenues became precarious. PS did state that the consultants were generally inclined to keep working for the sake of business continuity. PS said that the drop in income meant that 2020 became a complete write off for the company and that the only saving grace was the Temporary Wage Subsidy scheme.

In terms of the workplace set up, only the Accountancy and Finance team had as many as four consultants. The other areas such as Technology and Pharmaceutical tended to only have one consultant. PS said that it was obvious to Management that there were too many Consultants in the Accountancy and Finance team chasing the small amount of work then being generated. They assessed the situation in April and again in May. With the June 19th date looming. PS described this date as being a financial “cliff edge” in the minds of senior Management.

I have no further evidence or explanation or rationale for the decision-making process in the Respondent company at this time. Suffice to say that the decision was made (by whom I do not know) that a programme of Redundancy was needed to be implemented. This was driven, I am told, by the real fear that there would be no more state intervention from the 19th of June. There was no Redundancy policy in operation in this small workplace (as it had never applied in the past) and the Company decided it would have to adopt a process. For reasons that have not been satisfactorily explained to me, the company opted to operate a last in first out policy. I am not saying that this is necessarily an objectionable way to proceed (as LIFO is well known to operate in many workplaces), but I do not know what other procedures were looked at. If an employer is going to pluck a policy or procedure out of the thin air and without any basis or rational then the employer inevitably invites criticism from those employees most effected.

In was. Of course, in these circumstances that the Complainant’s employment came into focus. The Complainant had only worked in the Respondent company since April 2019. Both he and one other in the team were made redundant. The LIFO policy operated to terminate his employment. I note that the Complainant was notified of the fact of a Redundancy programme on the 22nd of May with the final outcome made on the 5th of June. The Respondent rejects the suggestion that the consultancy process was lip service and hastily done. PS was emphatic that the Complainant was given every opportunity to make submission and air concerns. A right of Appeal provided. The Complainant did not suggest any alternative options they said. The Respondent conceded that it did not consider moving the Complainant to another sector as his expertise was in Finance and Accounting.

The Respondent witness PS confirmed that the Complainant continued in their employment even after the Government stated that the TWSS would be extended to September 2020.

I understand that the employees continued to paid TWSS for the duration and I was also advised that at least one other role in that division (wherein the Complainant worked) was made redundant at a later date. I think there can be no doubt that the level of work dried up and I accept the evidence that the company revenues fell.

The Complainant believes there was some “inexplicable imperative” in operation here. In particular he believes the decision to make him Redundant was unfair in circumstances where the company could just as easily have brought the previously issued RP9 back into play. The Complainant could, quite simply have been laid off. That had been the Company’s immediate (and correct) response to the lockdown. I accept the Complainant’s rationale as this is in fact in line with the Government’s own thinking at the early stages of this pandemic. It should be noted that I do not agree with the Respondent’s argument that putting the complainant on lay off could still have a financial cost to the Respondent.

The Complainant put forward the case that he was in fact targeted for removal by reason of the fact that he had raised issues regarding the payment of the TWSS. He stated that he continued to work and he generated €14,000.00 of permanent placements over March. He says he was still putting in his maximum hours of work but was now receiving a much reduced salary of €350.00 per week – a state aided intervention. He says the redundancy consultative process was token as any proposition he put up was rejected without analysis. He says he was bounced into the redundancy process without having any advice or understanding of how to resist the outcome.

On balance I accept that the Complainant’s redundancy amounted to an Unfair Dismissal. I understand that the company was on the back foot and reacting to external events. However, all the signals from Government were to encourage people to stay the course with their workforce. The facility to put employees on lay off was provided for. I cannot understand how putting a person out of employment in the middle of a pandemic could possibly be considered the right thing to do. In fact, I would go so far as to say that this company (itself a recruitment company) uniquely knew how difficult it would be for the Complainant to find alternative employment. I am inclined to accept that the Complainant is right in saying the consultation process was inadequate and unfair and in particular there is no suggestion that the complainant was advised to seek independent advice.

I note that the Complainant found alternative employment thirteen weeks after the termination of his employment. In assessing loss I am mindful of the fact that the Complainant would have continued on the TWSS for some of that thirteen week period though might have also earned bonus.

Regarding the issue of unlawful deductions made under the Payment of Wages legislation I am satisfied that the complainant was aware of the fact that the TWSS was being operated in the workplace and the emails opened demonstrate an understanding of the situation. The TWSS was introduced to avoid wholesale redundancies or to operate as an enhanced lay-off package. In accepting that the Company’s revenues fell away I am also accepting that the level of work being performed by the Complainant was becoming less and less.

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

CA-00038757-001 - The Complainant was unfairly dismissed and I award him  €11,000.00 for the loss of remuneration arising out of the termination of his employment.

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

CA-00038757-002

 - The case made herein is not well founded.