ADJUDICATION OFFICER DECISION

Adjudication Reference: ADJ-00029340

Parties:

	Complainant	Respondent
Parties	Aidan Mccarthy	Abec Technologies Europe Limited

Representatives

Barry Sheehan Barry Sheehan, Solicitor ; Byron Wade BL

Peter McInnes McInnes Dunne Solicitors

Complaint(s):

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-00039207-001	17/08/2020

Date of Adjudication Hearing: 11/02/2022

Workplace Relations Commission Adjudication Officer: Brian Dalton

Procedure:

In accordance with Section 8 of the Unfair Dismissals Acts, 1977 - 2015,following the referral of the complaint to me by the Director General, I inquired into the complaint and gave the parties an opportunity to be heard by me and to present to me any evidence relevant to the complaint.

Background:

The complainant was employed as a Quality Technician. The company state that his primary role was that of a receiving inspector. Due to the pandemic the corporation was forced to reduce costs .An upturn in a part of the business occurred; arising from an increase in process solutions and services to vaccine manufacturers. However overall the business was negatively impacted by the pandemic. The quality department worldwide was required to downsize radically. As the complainant was working as a receiving inspector his role was identified to be at risk and ultimately was eliminated. It hasn’t been replaced at the time of the hearing. It was decided not to move him to another area as his skill set and experience of other areas such as clean room processes was on the objective measure of time spent in such roles at this manufacturing site less than others. In the light of the business challenges at the date of the decision that was an impartial and objective decision.

The complainant stated that his role was broader than just being a receiving inspector. He had previous experience in comparable processes such as clean rooms in other employments. He also had advanced relevant third level qualifications that complemented his previous experience. The reality is the process conducted by the company was siloed. There was no consultation. He was one of the first employees to be recruited by the company and had relatively long service.

The company advertised for quality technician roles some months after the complainant was made redundant.

Summary of Complainant’s Case:

In essence the complainant stated that the redundancy process was not reasonable. While the activity in his area decreased; the process followed by the company was not comprehensive or fair. There was no consultation whatsoever. If there had been adequate consultation, he would have had the opportunity to show how he possessed the relevant experience and qualifications to work in other areas. That information was available to the company from his HR file However, the selection of employees to be made redundant took place within the Quality Function based on a directive from on high without any serious consideration of other options such as transferability of the complainant’s skills to other areas; layoff or reduced hours. The process was siloed, flawed and conducted without any consultation. The employee had long service and in a plant of 100 employees it was only reasonable and fair that a wider review should have taken place.

Summary of Respondent’s Case:

It is accepted that the consultation process was inadequate. However, that must be viewed as a technical breach and in substance the decision made was fair and objective. The company is a multinational and competes on the international market. The quality function and particularly key aspects of the quality function experienced a massive decrease in work. That required a reorganisation along with other very difficult decisions such as pay reductions. The fact that this plant is part of a network of plants that provides worldwide capacity; meant that the quality function could not be looked at simply in terms of separate quality functions working independently of one another. It was very appropriate to review all positions in the function and that gave rise to a massive reduction in headcount worldwide within the function. While the respondent company recruited some months later; that was not to be known at the time of making the complainant redundant. The complainant is held in high regard. The decision to make him redundant was objective, fair and impersonal. The consultation process while flawed would have made no difference to the outcome. The criterion used was objective and fair and the fact was at this time that to displace any other quality technician; would require the complainant to have had experience in those clean room processes and systems at the plant, which he hadn’t to the same level as others. In the circumstances of the crisis facing the business that was not an unreasonable criterion to apply.

Findings and Conclusions:

The plant employs 100 employees.

During this time of reorganisation for the corporation, at this plant 7 employees were made redundant.

The complainant has relative long service at the plant, being one of the first to be recruited.

The respondent did not consider the complainant’s previous work experience in areas such as clean rooms or his advanced third level qualifications prior to making him redundant.

No consultation occurred with the employee. No alternatives to redundancy were considered.

The process was directed globally and the decision to make the complainant position redundant was made at Director of function level worldwide.

At a function level I am satisfied that the process was managed objectively and fairly. The decision was impersonal and objective based on relevance of experience while being employed at the manufacturing plant. That criterion was applied uniformly and without bias.

The respondent relies on St Ledger v Frontline Distributors Ireland Limited UD 56/1994; that redundancy has two important characteristics, namely impersonality and change. The decision to make the complainant redundant clearly possessed these characteristics.

In O’Rourke v Valcourt Limited [2015] ELR 209, while criticising procedural failings in the process; however, it was decided that did not negate the fact that a genuine redundancy existed and that the selection was fair.

Redmond on Dismissal Law 3rd Ed, Bloomsbury, 2017, referenced A Hotel Manager v A Hotel and Spa Resort Adj-00015257:

“Thus, even where an employer can be criticised for some elements of its interactions with the individual whose role is ultimately made redundant, the redundancy when looked at in its totality may not necessarily amount to an unfair dismissal.”

Finally it is argued that while many procedural accommodations are desirable; none are absolute ( Nigrell v Graham UD/690/2013).

The complainant states that these arguments do not apply in this case. It is clear on the evidence that the decision maker was not aware of the complainant’s experience and qualifications that may have made him more than suitable for other roles within the quality function itself; apart altogether from looking outside of the function itself and the wider plant. That process in turn may have identified someone else to be made redundant, objectively and fairly. The consideration of other alternatives to redundancy was not explored. When combined with the failure to consult in any way with the employee, the complainant contends that means the process is flawed and fatal having regard to the legal test as set out in the Act at 6(7):

(7) Without prejudice to the generality of subsection (1) of this section, in determining if a dismissal is an unfair dismissal, regard may be had, if the adjudication officer or the Labour Court , as the case may be, considers it appropriate to do so —

( a ) to the reasonableness or otherwise of the conduct (whether by act or omission) of the employer in relation to the dismissal, and

The complainant stated that the company could have placed the complainant on lay off or reduced his salary and also have availed of Government subsidy schemes prior to deciding if they had to make him redundant.

The complainant stated that the onus is on the employer to demonstrate that they acted fairly and reasonably. The complainant acknowledged that the decision maker had the right to reorganise and reduce headcount. However, the employer must also demonstrate that they acted reasonably in choosing this employee out of a population of 100 employees. If the company can advertise vacancies a few months after making the complainant redundant for quality technicians; surely they could have spent time to retrain or induct him into another area.

Both parties have made very compelling arguments. The employer stated while there may have been deficits, they were not fatal. What is crucial is to assess the decision maker at the time of making the decision and based on the information that he had in his possession; did he apply an objective and fair criterion? There is no question regarding the requirement for headcount reduction in the quality function and in fact it was a very significant reduction worldwide. In this case the business was haemorrhaging cash. There was no way to forecast what the future held and in fact it looked bleak. In this situation the selection criterion applied to suppress a position in contrast to making someone redundant; based on the challenge of a worldwide pandemic, was fair. It was applied objectively in order to protect the business and to keep those technicians that had the most relevant experience in those areas where there was work. While that same clean room area in turn expanded and did require additional resource some months later; at the time of making the complainant redundant that was not known.

The complainant did say at the hearing that he didn’t apply for a position in the clean room when it was advertised because he didn’t want to return on less money.

It was a fact that the business was facing major change arising from the pandemic. It is also clear that the suppression of the complainant’s position was fair; objective and impersonal. However, it is not evident that the process or decision to terminate the contract was reasonable and to make this employee redundant was fair.

The presumption of unfairness must be rebutted by the employer and while they have demonstrated that the complainant’s role was no longer required; they have not demonstrated that they acted reasonably before they made him redundant. The case law does demonstrate that the decision in the round must be looked at. However, that is also based on the presumption that the decision is unfair until rebutted and the requirement to demonstrate that the employer acted reasonably. The employer has not consulted with the employee and provided no evidence of assessing any other alternatives other than to make this employee redundant.

The criterion that the company used to displace the employee from the quality function is arguably objective. If the employer was to apply a different criterion such as service in the company; that would mean that an employee who had relevant experience in a clean room process would be displaced, after the complainant was trained to take over that role. It is not up to the adjudicator to decide what objective criterion should be applied. The criterion used by the director of the quality function was objective.

In Cronin v RPS Group, Tallaght UD 2348/2009 and cited in the Arthur Cox year book 2011 the tribunal determined that:

The EAT accepted that a genuine redundancy situation existed, but concluded that the employer did not act reasonably when it came to selecting the claimant for redundancy. It cited the following grounds for upholding the claim:

failure to advise the claimant of the criteria to be applied for redundancy;

failure to give her the opportunity to make representations on her own behalf in respect of those criteria;

failure to provide an appeal mechanism for the claimant;

the company adhered rigidly to a system of selection that did not provide for any consideration of redeployment;

failure to have regard to the claimant’s length of service.

The claimant was awarded €21,500 in compensation (less an amount already paid to her).

In this case while a genuine redundancy situation existed the process was rigid; was devoid of consultation; failed to have regard to the complainant’s length of service, his previous relevant experience and his qualifications for clean room process work. All of those factors may not have been sufficient to retain the employee; however, the test to be applied is how reasonable was the conduct of the employer when deciding that this employee should be made redundant. In the absence of any proof that alternatives were considered and also combined with the fact that no consultation occurred; the selection process must be deemed to be unfair. For these reasons I determine that the complainant was unfairly dismissed.

Decision:

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.

The employee was out of work for 1 year and has been successful in gaining new employment. His loss has been particularised at €37,000 gross.

The respondent employer did advertise roles subsequent to the redundancy including a quality technician role some months later. The employee did not apply for this role, as the amount on offer was less than he previously earned. However, he did make very significant efforts to obtain employment on a comparable rate.

Allowing for the fact that the complainant’s position had been made redundant and he is now employed I determine that compensation should be awarded in this case having regard to the other options for redress as set out in section 7 of the Act. The complainant also seeks compensation.

While the complainant made significant efforts to mitigate his loss; it is also evident that an opportunity to be rehired at the plant was not pursued; in the same area that the complainant believed he should have been redeployed to. While it is not possible to be certain how successful his application would have been; he was held in high regard and it was an opportunity not pursued. On evidence it would also appear that he did not wish to take a role on a lower salary.

Section 8 of the Act states that the adjudicator shall (iii) make a decision in relation to the claim consisting of an award of redress in accordance with section 7 or the dismissal of the claim, and section 7 provides for:

i) if the employee incurred any financial loss attributable to the dismissal, payment to him by the employer of such compensation in respect of the loss (not exceeding in amount 104 weeks remuneration in respect of the employment from which he was dismissed calculated in accordance with regulations under section 17 of this Act) as is just and equitable having regard to all the circumstance

In determining a just and equitable amount I have had regard to the facts that a genuine redundancy existed; an objective criterion was applied to suppress the employee’s role; albeit there was no consultation or evidence of alternatives explored to retain the complainant. I also had regard to the fact that the complainant failed to reapply for a position at the company some months later after being made redundant, that he stated at the hearing he was qualified to hold . I award the complainant €22,000 compensation for the financial loss arising from being unfairly dismissed as an amount that is just and equitable having regard to all the circumstances of this complaint. I have had regard in arriving at this amount of compensation that the employee under law is entitled to notice and statutory redundancy and the €22,000 compensation is in addition to all other payments already received relating to the termination of his employment:

“ financial loss”, in relation to the dismissal of an employee, includes any actual loss and any estimated prospective loss of income attributable to the dismissal and the value of any loss or diminution, attributable to the dismissal, of the rights of the employee under the Redundancy Payments Acts, 1967 to 1973, or in relation to superannuation;

Dated: 25th February 2022