Complainant

Respondent

Parties

Sarah  Clancy

Nespresso UK Limited

Representatives

Philip Moloney BL instructed   by  John Battles & Co.Solicitors

Niamh Mc Gowan BL instructed by  A&L Goodbody Solicitors

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-00035895-001

28/04/2020

Complaint seeking adjudication by the Workplace Relations Commission under Section 12 of the Minimum Notice & Terms of Employment Act, 1973

CA-00035895-002

28/04/2020

The Complainant was dismissed for alleged Gross Misconduct due to applying the benefit of customer loyalty cards for her own benefit.

The Complainant commenced employment with the Respondent on the 23rd of November, 2015.

By letter dated the 2nd of December, 2019 the Complainant was dismissed without notice for gross misconduct.

In the Complainants Complaint Form the Complainant sets out that she was unfairly dismissed in that the alleged offence does not warrant dismissal from her employment and that the employer acted unreasonably in the dismissal.

The Complainant submitted that ‘having regard to all the circumstances” (Section 6(1) of the Unfair Dismissals Act 1977) that the Respondent had not acted reasonably in dismissing the Plaintiff for gross misconduct (without notice) .

The Complainant submitted that it was not an appropriate sanction issued and was not within the “band of sanctions” which would be issued by a reasonable employer.

That the Respondent had not acted reasonably in failing to consider all possible sanctions available before deciding on the ultimate nuclear option  of the sanction of dismissal.

That the Respondent had acted unreasonably in failing to consider an alternative penalty to dismissal.

That the Respondent did not, in a meaningful way, have regard to its own disciplinary procedure by failing to have proper regard for the Complainants previous good record, her relatively long level of service and the nil business impact.

That the Respondent in allowing the Complainant to continue to work, while the alleged serious misconduct allegations were being investigated, undermines the “gross” nature of the employees actions.

That the Respondent In allowing the Complainant to continue to work during the course of the investigation (and up to dismissal) negates and/or undermines the Respondents allegation that there was a loss of trust in the complainant.

 Section 6(1) of the UDA provides that “the dismissal of an employee shall be deemed to be an unfair dismissal unless, having regard to all the circumstances, there was sufficient grounds to find the dismissal”. It is the Complainants contention/submission that the Respondent did not have “regard for all the circumstances” and did not act reasonably in dismissing the Plaintiff for  gross misconduct (without notice). 

Gross Misconduct On page 350 of “Redmond on Dismissal Law” (Third edition) it is sited that “gross misconduct has recently been described by the Workplace Relations Commission as being “at the zenith of possible charges relating to disciplinary procedure”, the Labour Court in a 2016 determination referred” to summary dismissal as being the nuclear weapon of the employers arsenal of disciplinary sanctions”. 

The Respondent in their submission referred to the total transactional value of €565.40 for which the Complainant was the Till Operator. However, in the Business Controls Investigation Report

 it is stated that the value gained fraudulently is the sum of €5.65. The Respondent has employed “the nuclear weapon of the Employers Disciplinary Sanctions” on foot of value gained fraudulently in the sum of €5.65. 

The Employment Appeals Tribunal in Lennon -v- Breddin M160/1978 referred to serious misconduct on the following terms: “this exemption only applies to a case of very bad behaviour of such kind that no reasonable employer would be expected to the tolerate the continuous employment relationship for a minute longer; we believe that the legislator had in mind such thing as violent assault or behaviour in the same serious category”. Notwithstanding the fact that the Business Controls Investigation Report reported on the 6th September, 2019) it was over two months before the Respondent acted on foot of this investigation report when by letter dated the 13th of November, 2019  the Complainant  was invited to an investigation meeting.  The Respondents do not offer any explanation for the delay in proceeding on foot of the investigation report. The Complainant  submitted that this undermined the finding of the Respondent and does not support an inability “to tolerate the continuous situation for a minute longer” (Lennon -v- Breddin).

The Respondents disciplinary procedure provides “where a worker is alleged to have committed an act of gross misconduct, he or she will normally be suspended before work on contractual pay while the company investigates the allegations”.  At no stage, from the date of the Brown Thomas Investigation Report (6th September, 2019) up to the date of the Complainant s dismissal (2nd December, 2019) did the respondent activate a suspension of the Complainant as per their disciplinary procedure.

The Complainant submits that the fact that the Respondent was able to “tolerate the continuance of the relationship” and their failure at any stage to suspend (as per their disciplinary procedure) undermined the finding of the Respondent of the “gross” nature of the employees actions. The Complainant suggested that if the Respondents truly believed that the value gained fraudulently of €5.65 was such as to constitute potential serious/gross misconduct then their failure to act expeditiously undermines such assertion.  If there was a suspicion that the Complainant  was guilty of gross misconduct then why did they leave her to continue to work for the complainant at all times up to the time of her dismissal. Furthermore, the assertion that the complainants act of gross misconduct had undermined the relationship of trust between the employer and employee is not sustainable if the complainant was allowed to continue to work for the Respondent up to the time of her dismissal.

In the Respondents disciplinary procedure (Section 7 dealing with gross misconduct) it states that “the following list provides examples of incidents which may be considered as gross misconduct:

“a….b….c. Fraud, d….etc etc”, The use of the word “may” indicates that there was a discretion afforded to the Respondent as to whether fraud was gross misconduct.  The level of “value gained” fraudulently is €5.65”. In the circumstances, it was submitted on behalf of the Complainant  that the Respondent never considered, that in light of the low value “gained,” exercising its discretion (as it is entitled to) under its  disciplinary procedure in not deeming this as gross misconduct.

Proportionality of Sanction and Alternative Sanctions: In the Respondents disciplinary procedure, its stated that “when deciding what level of disciplinary sanction, consideration is given to the following:

Previous record.

Mitigating circumstances.

Outcome of similar cases.

Circumstances surrounding the incident.

Business impact”.

The Complainant submitted that other than a cursory reference to the Complainants “service and disciplinary record” in her letter of dismissal there is no evidence to support this contention in any of the documents furnished. The Complainant had an unblemished record, before dismissal, and a relatively long level of service. There is no evidence to support the contention that any serious consideration was given to the Complainants previous records nor is there is any evidence to suggest that the fraud which the Plaintiff was accused of had any business impact as per the disciplinary procedure.

The Respondents disciplinary procedure provides that “where on completion of the investigation following a disciplinary hearing, the company has reasonable believe that gross misconduct has occurred, the result will normally result in summary dismissal (dismissal without notice)”. Therefore, the Complainant submitted that there is still a certain amount of discretion available to the Respondent in the event of a finding of gross misconduct (i.e. that it does not automatically result in dismissal).

Case Law has established as per any disciplinary sanctions imposed on an employee, they must be proportionate to the complaint against them and an employer must consider alternative sanctions to dismissal where appropriate. In the case of DHL Express (Ireland) Limited -v- Michael Coughlan (Labour Court Determination Number UDD1738) where an employer was summarily dismissed, the Labour Court found in favour of the Complainant and ruled that the Respondent did not give consideration to imposing an alternative sanction and a more proportionate sanction on their employee.

A further case which establishes that an employee, before dismissing and individual, should give consideration to alternative sanctions is the case of a Social Care Worker v Care Services Provider.(ADJ-00025193). This case referred to the “band of reasonable responses test” in the context of Section 6 of the UDA 1977 as set out by Noonan J in the Governor and Company of the Bank of Ireland -v- Reilly. The test went on to say ….”not to say that the Court or other relevant body may substitute its own judgement as to whether the dismissal was reasonable for that of the employer. The question was whether the decision to dismiss was is a reasonable response of a reasonable employer to the conduct”.  In the case of Social Care Worker v Care Services Provider, the Labour Court found in favour of the complainant and in its decision indicated that the lack of consideration of alternative sanctions and a relatively clean disciplinary record, that a dismissal was disproportionate to the infringement complained of.

It was submitted by the Complainant that there was no evidence that at any stage that the Respondent considered any alternative sanctions as required by Case Law. Furthermore, applying the band of reasonable tests the sanction of dismissal was disproportionate.

In a case similar to the Complainants case, the Complainant  was dismissed because of misuse of Dunnes Stores Value Club Scheme. In this case Dunnes Stores v Heffernan  (UDI 1355/2009) it was established, following an investigation of over two weeks, the Complainant  had “in the period of 2008-2009 vouchers totalling €110 had been rewarded to the Complainant ”.  Of note  in this case, it was another five weeks before the Complainant  was confronted with the findings of the two week investigation. The  tribunal in its determination indicated that they were concerned as to the proportionality of the sanction to the actions complained of and found that the Complainant  had been unfairly dismissed.

In the case of Tim Marks -v- ICTS Ireland UD 159/2015, Mr. Marks was dismissed for gross misconduct after he admitted taking a discarded copy of TIME magazine from a rubbish bag on the stairwell of the United Airlines Aircraft. The then EAT found that the sacking was “disproportionate having regard to the value and significance of the property and the length of service and good employment record of Mr. Marks”.  Furthermore, the EAT also stated that the ICTS Ireland failed to convince the tribunal that the ultimate sanction of dismissal was the only appropriate sanction in the circumstances.

The Complainant herein has been dismissed by reason of “gross” misconduct for fraud in the sum of €5.65. by way of comparison the sum of money in Heffernan -v- Dunnes Stores where the Complainant  had abused a loyalty card scheme to the sum of €110.

It was submitted, that in all the circumstances having regard to the case law and the principles set out, that the sanction was disproportionate in all the circumstances and that there is no evidence that the respondents at any time consider an alternative sanction to the one that was imposed on the Complainant .

In the event that the Adjudicator finds that the Respondent has not acted reasonably and that the Complainant  was unfairly dismissed, we submit that the Complainants claim under the Minimum Notice and Terms of Employment Act should succeed. In that event, the Complainant submits that the amount owing would be two weeks notice in accordance with the provisions of Section 4 of the Minimum Notice and Terms of Employment Act as the Complainant was in the continuous employment of the Respondent at the date of the termination of her employment for more than two years but fewer than five years.

In the case of Lennon -v- Breddin (M160/1978) the EAT stated that “Section 8 of the Minimum Notice and Terms of Employment Act saves an employer from liability for minimum notice for misconduct, we have always held that this exemption applies only to cases of very bad behaviour of such a kind that no reasonable employer would be expected to tolerate the continuous of the relationship for a minute longer”.

The Complainant submitted that the “value gained fraudulently of €5.65”does not meet the test of very bad behaviour of such a kind that no reasonable employer could be expected to tolerate the “continuance of the relationship for a minute longer”.  

Clearly the Respondent was aware from the Brown  Thomas Report (6th September, 2019) of the valued “gained fraudulently of €5.65”, but yet continued to allow the Plaintiff to work without any restrictions until her ultimate dismissal in December, 2019. This behaviour by the Respondent  is not consistent with an intolerance to the “continuation of the relationship for a minute longer”.

It is accepted by the Complainant that she must satisfy in the event of her claim being successful that she has suffered financial loss.  In this regard the Complainant  made a number of applications for positions before securing a position with the Brothers of Charity Services Ireland as follows:

Sales Support Administrator at Wavion Ltd – 11th January 2020 with letter of 16th February 2020 from Wavion Ltd.

Computer Helpdesk Assistant via Uni Jobs – 16th January 2020

Insurance Broker via Engage People – 23rd January 2020

Receptionist via Aspire Recruitment – 28th January 2020

TTM Healthcare Instructor Level 2 –3rd February 2020

The Complainant  supplied copies of her applications, letter from Wavion Limited and a copy of her starting contract of employment with the Brothers of Charity Services Ireland dated 26th March 2020.

The Complainant  was working 40 hours per week and earning €1,660.40 per month, net.

The Complainant  therefore earned:

€415.10 per week, net.

€830.20 fortnightly, net.

€1,660.40 per month.

In terms of the Complainant ’s loss, the Complainant  commenced employment with the Brothers of Charity as a support worker on the 18th March 2020.

From the 02/12/2019 to 18/03/2020, the Complainant  incurred a loss of €5,811.40 net in her wages calculated on the basis of €1,660.40 net per month.

The Complainant  began working 15 hours per week, 30 hours per fortnight and paid accordingly.

From the 18/03/2020 to 07/06/2020, the Complainant  earned the total sum of €2,292.72 over 6 fortnightly pay periods, net. Had the Complainant  remained employed with the Respondent she could have earned €4,981,20 (over 6 fortnightly pay periods, net). The net loss for this period is €2,688.48. 

The Complainant  signed an updated contract of employment with the Brothers of Charity on the 12th October 2020 increasing her working hours to 59.8 hours per fortnight. From the 07/06/2020 to 11/10/2020 the Complainant  earned the total sum net of €6,716.06 over 9 fortnightly pay periods, net. Had the Complainant  remained employed with the Respondent she could have earned €7,471.80(over 9 fortnightly pay periods, net). The loss for this period is €755.74.

From the commencement of the new contract of employment i.e. 12/10/2020 to the 09/05/2021, the Complainant  has earned the sum of €11,064.51 (over 15 fortnightly pay periods, net). Had the Complainant  remained employed with the Respondent she could have earned €12,453.00 (over 15 fortnightly pay periods, net). The loss for this period is €1,388.49.

After the 9th May 2021 (09/05/2021) the Complainant  started to earn more net per fortnight than she was losing. Therefore, her loss ended on the 9th May 2021.

Total Net Loss of Earnings from 02/12/2019 – 09/05/2021: €10,644.11

The Complainant  supplied copies of payslips from her employment with the Respondent and the Brothers of Charity Services Ireland together with an updated contract of employment of the 12th October 2020 from her current employer.

The Complainant submitted in all the circumstances, the Respondent failed to have regard to all the circumstances (as required under Section 6) in deciding to dismiss the Plaintiff for gross misconduct.

The Respondent failed to have regard to the Respondents good disciplinary record with the company, her length of service and failed to have or consider in any meaningful way, an alternative sanction to the sanction imposed. The Complainant submits that the finding of gross misconduct was disproportionate and excessive and the sanction imposed was disproportionate. The Complainant submits that the Respondent did not have substantial grounds to justify her dismissal and the Complainant submits that her dismissal was unfair and asks the Adjudicator to so find. Furthermore, the Complainants claim for notice under 1973 is well founded and asks the Adjudicating Officer to so find.

In her WRC complaint form the Complainant alleges that her dismissal was unfair on the basis that the Respondent acted unreasonably in the dismissal, procedurally, and that the alleged offence did not warrant dismissal from her employment.

The Respondent stated that the Complainant was afforded the full panoply of fair procedures and natural justice rights in the investigation into an alleged fraud by the Complainant in the use of her BT loyalty card for customer transactions. She was then engaged in a disciplinary process where she was again afforded fair procedures and natural justice before a decision was taken to dismiss the Complainant because of the fraudulent and serious nature of the activity engaged in by her.

The Respondent stated that it had substantial grounds to justify the Complainant’s summary dismissal for arising from her gross misconduct and that the procedures adopted were fair in all the circumstances.

The Respondent sells coffee and coffee related products, including the sale and distribution of coffee machines, coffee capsules and other coffee related products to its customer base which includes offices, restaurants, customer services businesses and luxury retailers worldwide. In 2015 the Respondent opened its Coffee Boutique in the Brown Thomas (“BT”) store in Limerick.

The Complainant commenced her employment with the Respondent on 23 November 2015 as a Boutique Coffee Specialist based in BT Limerick, working 40 hours per week scheduled over seven days.  The Complainant was given an offer letter and contract of employment and was provided with a copy of the BT Team Member Handbook which included all of the relevant rules applicable to her working at BT.  The Complainant signed for receipt of the Team Member Handbook and acknowledged that it was her responsibility to familiarise herself with the policy contents and any updates.  This handbook included the policy in respect of loyalty cards.  This policy was also displayed in poster format in staff areas of the BT Limerick store and featured in team briefings conducted by the Respondent.

At the start of her employment, the Complainant completed induction training during which key policies were explained including the rules around the use of the BT loyalty card.  Notably, she received training on BT Point of Sale Operator training which deals with all aspects of operating at this till point. Following this training she signed an acknowledgment which confirms that she understood her responsibilities and training as a till operator.

Towards the end of 2019 the Respondent was informed that a random audit conducted by BT to identify potential frauds had identified a potential issue, in respect of the Complainant, that she appeared to be applying her loyalty card to customers’ transactions while she was the till operator.  Eleven transactions in total were identified for the audit period from 30 August 2019 to 4 November 2019 with a total transactional value of €565.40 for which the Complainant was the till operator and the Complainant’s loyalty card was used.

The Respondent’s HR department, following receipt of the audit report, commenced an investigation process, leading to a disciplinary process which ultimately resulted in the Complainant’s dismissal for gross misconduct on 2 December 2019.  The Complainant was offered the opportunity to appeal the decision to dismiss and time was extended to allow her to do so but no appeal was lodged by or on behalf of the Complainant.

The Respondent supplied evidence of the Investigation and Disciplinary Processes including the decision maker who ultimately made the decision to dismiss. The Manager who carried out the Investigation on behalf of the Respondent, relied on the documentation which had been provided by the Brown Thomas Fraud Analyst.  The Complainant was given five days’ notice when she was invited, in writing, to attend an investigation meeting and advised of her right to be accompanied to that meeting by a work colleague or trade union representative.  This meeting was scheduled for 20 November 2019.  The purpose of the investigation was set out as being to:  

“investigate and establish whether there is a case to answer in relation to:

Alleged breach of Brown Thomas loyalty programme; and 

Alleged misappropriation of points from customers.”

At that investigation meeting, at which the Complainant was accompanied by a Trade Union Representative, the details of the issues identified by the BT Fraud Analyst were put to the Complainant.  The Complainant asked for some time with her Representative to consider what was being put to her so a further meeting was arranged for the following day.  The notes of the first meeting were provided to the Complainant in advance of the second investigation meeting. At the second investigation meeting the Complainant was unaccompanied and was reminded of her entitlement to have someone with her but preferred to proceed alone.  The Complainant indicated that she understood the loyalty programme to allow customers to gain points back on purchases they made.  When examples of the transactions were shown to the Complainant which showed the Complainant’s loyalty card being used for a variety of named (and unnamed) customer transactions while she was the till operator the Complainant said that she had lost her loyalty card some weeks previously and said that a customer had perhaps picked it up and started using it.  

The Complainant was unable to explain how eleven separate transactions could involve the use of her loyalty card.  She acknowledged that she was the till operator in respect of all of the transactions but could only recall one transaction which she attributed to her sister’s boyfriend.  The Complainant maintained that she was unaware that it was a breach of the Respondent’s policy for her to sell to family and friends, despite it having been covered in her induction training. The Complainant asserted that she had not done anything wrong but was unable to explain the eleven transactions on her card and unable to identify the customer names put to her, against whose transactions her loyalty card had been scanned.  The Complainant said that she did not know the customers in question.  The Complainant did not provide any explanation for how her loyalty card was scanned against eleven separate customer transactions over a period of time from August to November 2019 which resulted in her obtaining the loyalty points and not the customer who had the entitlement to receive them. 

Because the investigation meetings identified that the Complainant had a case to answer a disciplinary meeting was convened by the Multi-Site Manager, to which the Complainant was invited in writing and advised of her entitlement to attend with a work colleague or trade union representative of her choosing.  The Complainant was given written notice of the disciplinary hearing and provided with a copy of the Respondent’s disciplinary procedure and the loyalty card transaction report containing the details of the alleged offences. The concerns about the Complainant’s conduct were set out as follows: (a) Alleged breach of Brown Thomas loyalty programme; and  (b) Alleged misappropriation of points from customers. The letter also advised that the possible outcome of the disciplinary hearing was disciplinary action up to and including dismissal.  The disciplinary meeting took place on 2 December 2019 and the Complainant attended unaccompanied.  The disciplinary manager was accompanied by a HR Business Partner, for the purposes of taking notes of the meeting.  The Complainant was advised again of her entitlement to be accompanied to the meeting but she maintained she was satisfied to proceed without a representative.  It was set out in that meeting that the hearing was regarding the alleged misuse of the BT staff discount/loyalty card and the misappropriation of customers’ points by the Complainant.  The Complainant stated that she had lost the card in the previous couple of weeks as she had told the Disciplinary Hearing Manager, when a staff purchase was being processed for her, that her card was in her bag.  The Complainant was unable to explain how any of the transactions (except for one relating to her sister’s boyfriend), all of which she accepted she processed at the relevant till, involved the scanning of her loyalty card.  The Complainant accepted that it was “very unlikely” that any of the customers would have had access to her loyalty card.  The Complainant said that she had given the best answers she could and that she could not provide an explanation.  The meeting adjourned to allow the Disciplinary Hearing Manager to consider the facts and for the Complainant to confirm the minutes taken were in order.

When the disciplinary meeting reconvened a number of matters were clarified with the Complainant and she accepted that it was very unlikely that a number of customers would have access to her loyalty card.  The Complainant further accepted that she was the only beneficiary of the financial gain from having her loyalty card scanned at these transactions.  Based on the evidence available to her the disciplinary manager concluded that she considered that the activity amounted to fraudulent abuse of the Respondent’s and BT’s policy and involved a financial gain to the Complainant as a result of using customer data.  The Disciplinary Hearing Manager  concluded that the activity amounted to gross misconduct for which she reluctantly found the sanction should be dismissal.  The Complainant was advised of her right of appeal of the decision to dismiss.

The disciplinary manager wrote to the Complainant on 2 December 2019, confirming the outcome of the disciplinary meeting and the decision that the Complainant was to be dismissed without notice for gross misconduct. In accordance with the Respondent’s disciplinary policy the Complainant was notified of the person to whom she could appeal against the decision to dismiss and given five working days to do so.  After expiry of this time period the Complainant sought an extension of time to lodge her appeal and a further ten day period was allowed, until 20 December 2019.  The Complainant did not appeal the decision to dismiss.

The UDA defines “dismissal” in relation to an employee as “the termination by his employer of the employee’s contract of employment with the employer, whether prior notice of the termination was or was not given to the employee”.  For the purposes of the UDA the Respondent does not dispute that it meets the definition of employer and the Complainant meets the definition of an employee within the meaning of the UDA.  

Section 6(1) of the UDA provides that “a dismissal of an employee shall be deemed to be an unfair dismissal unless, having regard to all the circumstances, there were substantial grounds justifying the dismissal”.  

Section 6(4) provides that: ”without prejudice to the generality of section 6(1), a dismissal of an employee shall be deemed, for the purposes of the UDA, not to be an unfair dismissal if it results wholly or mainly from … (b) the conduct of the employee”.  

The Complainant makes two claims.  First, she claims that the dismissal was procedurally unfair and second, that the alleged offence did not warrant dismissal.  Both of those are disputed by the Respondent and it is submitted that the evidence set out in section 3 above clearly demonstrates that fair procedures and natural justice were provided throughout the process.  Further, in the context of fraudulent activity in a retail environment, where trust in employees is essential, it is submitted that dismissal was an appropriate and proportionate remedy in all the circumstances.

The test in respect of reasonableness in cases of dismissals for conduct was set out in an Employment Appeals Tribunal’s decision in HennessyvRead & Write Shop Ltd. UD 192/1978.  In that case the Tribunal held that:

“In deciding whether or not the dismissal of the Complainant  was unfair we apply a test of reasonableness to:

The nature and extent of the enquiry carried out by the respondent prior to the decision to dismiss the Complainant , and 

The conclusion arrived at by the respondent that, on the basis of the information resulting from such enquiry, the Complainant  should be dismissed.”

It was submitted that the Respondent carried out a full enquiry into the issue of potential fraud once it was brought to its attention by BT and it was further submitted that the conclusion arrived at by the Respondent, arising from that enquiry and from the response of the Complainant to that enquiry, justified its decision to dismiss the Complainant.  

The procedures adopted by the Respondent were fair and transparent and followed its Disciplinary Policy and Procedure of which the Complainant was aware and which was provided to her again before commencement of the disciplinary process.  The Respondent notified the Complainant of a potential fraud issue promptly and in writing once the Respondent became aware of the issue. In deciding to carry out an investigation the Respondent invited the Complainant to a meeting, giving her adequate notice in writing and advising her of her entitlement to be accompanied by a work colleague or trade union representative at that meeting. The letter inviting the Complainant to an investigation meeting set out that the investigation related to a breach of the BT loyalty programme and the alleged misappropriation of points from customers so the Complainant was aware from the start of the process exactly what the issues were.  When the Complainant sought additional time to consider the facts of the allegations (including with her representative) after they were put to her the Respondent facilitated an adjournment of the meeting for 24 hours.  When the investigation concluded without the Complainant providing any explanations for the use of her loyalty card on eleven different customers’ transactions which took place while she was operating the till the Respondent resolved to commence a disciplinary process which was conducted by a different manager to the investigating manager.  The Complainant was given notice in writing of the disciplinary meeting, advised of the issue to be considered, informed of her entitlement to be accompanied, and provided with a copy of the Respondent’s disciplinary policy and procedure and the transaction information which was the subject of the disciplinary meeting.  The Complainant was given adequate opportunity to deny the allegations or explain the circumstances during the disciplinary meeting. Where no explanation was provided by the Complainant for the transactions in question and where the Respondent believed (based on the evidence) that the Complainant had conducted herself as alleged and that there was no alternative explanation which could explain the transactions and where the Respondent had reasonable grounds to sustain that belief; the Respondent made the decision that dismissal was the appropriate remedy having regard to all the factors.  It was submitted that the Respondent’s decision to dismiss was reasonable in all the circumstances.

The Respondent’s Disciplinary Policy and Procedure identifies that dismissal may be appropriate for extremely serious offences which could be considered to be gross misconduct.  Section 7 of the Disciplinary Policy and Procedure provides a non-exhaustive list of offences which may be considered as gross misconduct including inter alia theft from the Company, fraud, falsification of records, and bringing the Company into disrepute.  It was submitted that the conduct involving the fraudulent use of the Complainant’s loyalty card falls firmly within the category of extremely serious offences which could be considered gross misconduct by the Respondent.

In Csorba v Dunnes Stores UD327/2009 the Employment Appeals Tribunal upheld the dismissal of a retail worker who was dismissed for using her clubcard on customers’ transactions where the evidence showed that misuse of her loyalty card was the reason for her dismissal.

In Dunnes Stores v Karen Walsh UDD2021 the Labour Court held that:  “It is not for the Court to put itself in the place of the employer in the within case.  Rather the role of the Court is to determine whether the actions of the employer fall within the range of actions which a reasonable employer would take in the circumstances.”  The Karen Walsh case concerned a manager, with 21 years’ service, who had consumed food from the store’s restaurant and sandwich counter without paying for it.  She admitted the offences.  The Labour Court found that “[t]aking account of the nature of the Respondent’s business and the trust that must exist between employer and employee in such an environment the Court finds that in the circumstances it was reasonable for the Respondent to treat the admitted removal of goods from the store without payment as being very serious”.

It was submitted that in the instant case the Respondent faced even greater difficulties in that the Complainant made no admissions and accepted no responsibility for having used her loyalty card to take customers’ points for herself.  The Respondent rightly concluded that there was no other explanation for how the Complainant’s loyalty card came to be used on eleven different occasions, involving eleven different customers and transactions over a range of dates while she was logged onto the till, other than that the Complainant had scanned her card herself.  The Complainant provided no explanation and made no admissions.  The Respondent, having reached the only credible conclusion that the Complainant had in fact scanned her own loyalty card to take advantage of the customers’ points, made the difficult decision to dismiss the Complainant.  It is submitted that the decision to dismiss was fair and reasonable in all the circumstances.  In a retail environment the trust between employer and employee is imperative and where the Complainant, despite all the evidence put to her, continued to deny her involvement in the loyalty card transactions it was reasonable that the Respondent would consider her position to be untenable.

It is settled law that it is not for the Adjudication Officer to consider he/she would have made the decision to dismiss.  Rather the role of the WRC is to determine whether the decision to dismiss was within the band of reasonable alternatives open to the Respondent.  If it is, and it is submitted that the decision was manifestly reasonable, then the dismissal must be found to be not unfair.

The Labour Court has considered the relevant case law regarding the role for the Court (and by implication, the WRC) in determining whether a decision to dismiss is fair in both the Karen Walsh case and in the case of Dunnes Stores v Elaine O’Brien UDD1714 (in a capability based dismissal) .  In both cases the Court relied upon the same UK authorities.

The Labour Court cited Donaldson LJ of the Court of Appeal for England and Wales as finding in Union of Construction Allied Trades and Technicians v Brane [1981] IRLR 224 :

“It is a very sensible approach for Tribunals to put themselves into the position of the employer, informing themselves of what the employer knew at the moment, imagining themselves in that position and asking the question, ‘Would a reasonable person in those circumstances dismiss?’  However, Tribunals must not fall into the error of asking themselves the question: ‘Would we dismiss?’ because there is sometimes a situation in which one reasonable employer would and one would not. It is sufficient that a reasonable employer would regard the circumstances as sufficient reason for dismissing.  The statute does not require the employer to satisfy the Tribunal of the rather more difficult consideration that all reasonable employers would dismiss in those circumstances”. 

The Labour Court further relied upon the judgment of Lord Denning MR in British Leyland UK Ltd v Swift [1981] IRLR 91 (incorrectly cited as being a judgment in Derryquin Hotels Ltd v Savage which was a decision of the Irish Employment Appeals Tribunal in 2007) where he stated the position as being: “It must be remembered that in all these cases there is a band of reasonableness within which one employer might reasonably take one view: another quite reasonably take a different view.  One would quite reasonably dismiss the man.  The other would quite reasonably keep him on.  Both views may be quite reasonable.  If it was quite reasonable to dismiss him, then the dismissal must be upheld as fair: even though some other employers may not have dismissed him.”

Of significance also in the British Leyland case is that Lord Denning considered the employee’s conduct after he was tackled with the offence to be relevant.  In that case the employee made no admissions and accepted no responsibility for his wrongdoing which Lord Denning said was “a very relevant consideration, which would influence any reasonable employer”.

In NC Watling & Co Ltd v Richardson [1978] IRLR 255  the UK Employment Appeal

Tribunal identified that: “[T]he fairness or unfairness of the dismissal is to be judged by the objective standard of the way in which a reasonable employer in those circumstances in that line of business, would have behaved.”  

The Employment Appeals Tribunal in this jurisdiction adopted and applied the above principle from the Watling case in Richard J Bunyan v United Dominions Trust (Ireland) Ltd [1982] ILRM 404 going on to state: “The tribunal therefore does not decide the question whether or not, on the evidence before it, the employee should be dismissed. The decision to dismiss has been taken and our function is to test such decision against what we consider the reasonable employer would have done and/or concluded.”

It was submitted that, in adopting the role advanced by the Labour Court, the Adjudication Officer in this instance cannot find that the Respondent acted other than reasonably.  Further the Complainant was afforded full fair procedures and natural justice rights.  The Respondent was entitled to consider how trustworthy its employees are and, where the Complainant simply asserted that she had done nothing wrong and could provide no explanation, the decision to dismiss was reasonable in all the circumstances.

In the Karen Walsh case the Labour Court considered the underlying events giving rise to the decision to dismiss and was satisfied that the conduct of the Appellant could be regarded as sufficiently grave to give rise to serious disciplinary sanction.  The Court found that the sanction of dismissal falls within the responses which might be expected of a reasonable employer.  The Court went on to consider the procedures invoked by the Respondent and found that the investigative and disciplinary processes employed by the Respondent were fair and were conducted appropriately.  

It is submitted that the approach adopted by the Labour Court in the Karen Walsh case should be adopted in the instant case.  In the instant case, the Complainant was aware of the substantive rules around the use of her loyalty card and accepted that its use on customer transactions was wrong and prohibited.  The Complainant made no admission of wrongdoing when the wrongdoing became obvious.  The procedures employed by the Respondent were fair and were conducted appropriately and the conclusion reached by the Respondent in respect of the activity engaged in by the Complainant was the only one which could reasonably be reached based on the evidence available to it.  

It was submitted that the Respondent had substantial grounds to dismiss the Complainant and acted reasonably in so doing.  The Respondent asks the Adjudication Officer to find that the dismissal was not unfair and to dismiss the Complainant’s claim.  

Strictly without prejudice to the foregoing submissions, if the Adjudication Officer finds that the Complainant has been unfairly dismissed (which is denied), it is submitted that he/she must satisfy themselves that the Complainant has, in fact, suffered financial loss. The Respondent places the Complainant on strict proof of her efforts to mitigate her financial loss.  The Respondent notes that the Complainant obtained alternative employment on 18 March 2020. 

The Complainant advances a claim for statutory notice arising from the termination of her employment.  If the Complainant was entitled to such notice (which is denied) it would amount to two weeks’ notice in accordance with the provisions of section 4(2)(a) of the Minimum Notice & Terms of Employment Act, 1973 (“the 1973 Act”) as she was in the continuous service of the Respondent, at the date of the termination of her employment, for more than two years but fewer than five years. However, section 8 of the 1973 Act provides that: “Nothing in this Act shall affect the right of any employer or employee to terminate a contract of employment without notice because of the misconduct by the other party”. The Terms of Employment section of the Complainant’s contract of employment (Appendix 2) provides that: “The Company may dismiss you without notice if you: are guilty of gross misconduct in the course of youremployment…”.The Respondent’s Disciplinary Policy and Procedure provides that “summary dismissal, i.e. dismissal withoutnotice, will only be used for serious cases which are regarded as gross misconduct”.  It further provides that no period of notice or pay in lieu of notice will be given in cases of summary dismissal.

In circumstances where the Complainant was dismissed by the Respondent for gross misconduct the Complainant has no entitlement to notice or pay in lieu of notice on either a statutory or contractual basis.  The Complainant’s dismissal arose because of her fraudulent use of her BT loyalty card where she took customers’ points for her own benefit knowing that to do so was in breach of the rules of the loyalty card scheme. The Respondent carried out a full and fair investigation and an independent disciplinary process before reaching the reasonable conclusion that dismissal was appropriate in all the circumstances. The Respondent had substantial grounds to justify the Complainant’s dismissal on the grounds of gross misconduct and fair procedures were followed. The Respondent submits that the Complainant’s dismissal is not an unfair dismissal and the Respondent asks this Adjudication Officer to so find. In light of the above submissions the Respondent submitted that the Complainant’s claim for notice under the 1973 Act is not well founded and that no notice is payable to the Complainant and asked the Adjudication Officer to so find.

The Law.

“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.

The Adjudicator has given considerable consideration to both submissions and to the relative merits of both cases put forward on both the substantive and procedural issues involved. I will now consider each of the core issues relevant to this case.

Is it reasonable to consider the Complainant committed the alleged acts she was dismissed for?

The Complainants explanations as to how her card got lost/used are not believable. The only logical explanation is she used the card herself to get the benefit of the loyalty credit from customers for herself. This action is a serious breach of trust and while much was made of the small value/benefit the Complainant stood to benefit by this is not the core issue. The issue is the Complainant committed a serious breach of trust. It is well established that once the Bond of Trust is broken then an employment relationship can suffer a severe or terminal breakup. No satisfactory answer was supplied at the Hearing as to why the Complainant used other peoples loyalty cards for her own, albeit, limited benefit possibility.

None of the alternative scenarios supplied as to how the situation occurred seem credible to the Adjudicator. It is also well established that the amount of money involved in a misappropriation of funds or potential misuse of funds is not a core issue in deciding if such action can be deemed gross misconduct.

Were the Complainants responses to the Investigation believable?

The Complainant may well have compounded the lack of trust in her and ultimate dismissal by the Respondent by not owning up to the situation immediately it was brought to her attention.

Her denial and excuses were not believable and contributed to the Respondents view she should be dismissed.

Did the Complainants actions consist of gross misconduct?

Using customer loyalty cards for her own benefit amount to an act of fraud and constitute grounds for gross misconduct. The value, while low, is not really relevant in this case as the action could well have continued into the future and increased and the Bond of Trust was broken by both the Complainants actions, her concocting a story about her card being lost and her denial of the situation during the Investigation.

Was it reasonable to not suspend the Complainant during the investigation?

The arguments for and against suspending an employee gets many different treatments in submissions to Adjudicators.  Some say to suspend the employee (even with pay) amounts to an infringement on the employees character and contributes to defining the negative outcome of an Investigation from an employees perspective. Others say not suspending an employee (as in this case) amounts to saying the action accused of is not serious enough to warrant dismissal. Placing an employee on suspension is a serious act in itself and should only be used when there is convincing and compelling reason to do so (for example the possibility of interfering with witnesses).  The Complainant was not suspended in this case and the Adjudicator has concluded this is not a core issue in the evaluation of this claim.

Did the Respondent appropriately and reasonably consider alternative sanctions to dismissal?

The Complainants Representatives made a strong case that the Respondent did not give any evidence to show they considered any other alternatives to dismissal and should have taken the Complainants service, exemplary record, small value of the issue involved and no business loss into account. The Respondent failed to give a satisfactory analysis of what, if any, alternative disciplinary actions it considered and why they choose dismissal instead of an alternative option.

It is well established case law that an Adjudicator should not put itself in the place of an employer who has dismissed an employee but to consider whether the dismissal fits into the “band of reasonable responses” open to an employer. It is the case that dismissal decision fits into this category, however so do many other alternative disciplinary actions i.e. final written warning or suspension. Either of these three options could be a reasonable disciplinary action in this case. So the question is was the ultimate sanction of dismissal appropriate in the circumstances. Case law presented by the parties has conflicting precedents regarding this issue. For example, in the Lennon v Bredin case could it be said that the employment relationship in this case could not have continued for " a minute longer”. This does not apply in this case as alternative serious disciplinary action could have been implemented and the employer could have retained the employee in employment but also disciplined her for her actions.  While the issue in Marks v ICTS Ireland was not the same in that the item concerned a discarded magazine , had really no value the decision that the dismissal was disproportionate to the value of the time and that fact that the Tribunal was not convinced other sanctions could have been applied is relevant. On the other-hand the Decision in Csorba V Dunnes Stores would seem to favour the Respondents case. Likewise, the Karen Walsh v Dunnes Stores outcome. It is possible that other employers would not have dismissed in similar circumstances and taken a less severe disciplinary action. So the core issue is was the sanction within the Band of reasonable responses and the answer is yes but equally an alternative disciplinary action may have been appropriate. Each case stands on its own merits and has to be evaluated on its own circumstances and background.

It is not clear from the submissions that the Respondent gave adequate consideration to alternative disciplinary remedies. However, while this may be a matter of fair process and properly put forward for analysis by the Complainants Representatives I am in no doubt that should alternative sanctions have been given more consideration by the Respondent that it would have been futile and the outcome would have been the same as decided upon by the Respondent.  This is not to say that it should not have happened more thoroughly and more evidence of same should have been presented to the Adjudicator, if such detailed analysis did take place.

Section 8 of the Unfair Dismissals Acts, 1977 – 2015 requires that I make a decision in relation to the unfair dismissal complaint consisting of a grant of redress in accordance with section 7 of the 1977 Act. I have considered the alternative decisions open to me in this case quite carefully. And many options could reasonably have been concluded which I would be comfortable with. However, having reflected on the options open to me I have decided that the Complainants actions were very serious, her actions and denials (stories) during the investigation did her no good in her relationship with her Managers and Investigators and contributed to the decision to dismissal. However, at the time of dismissal the Complainant had not received any benefit from her actions. What is unclear is if the Complainant had  “owned up” to her actions would she have been dismissed?? The possibility exists that is that she may not have been as it was her denial that also contributed to her dismissal.  What is also unclear is what level of consideration did the Respondent give to other reasonable alternative disciplinary sanctions.  For these two reasons I deem the Complainants dismissal to be unfair but that the Complainant contributed significantly to her own dismissal by her actions and denial of events. The Complainant has submitted her loss to be 10,644.11 Euros. I find that the actions of the Complainant significantly contributed towards her dismissal and therefore award her only 50% of her loss which is 5.322.05  Euros. (CA-00035895-001).

Section 41 of the Workplace Relations Act 2015 requires that I make a decision in relation to the complaint in accordance with the relevant redress provisions under Schedule 6 of that Act.  The claim under the Minimum Notice and Terms of Employment Act 1973 succeeds as the Complainant succeeded in her Unfair Dismissal claim and is awarded two-weeks notice which equates to a gross sum of 830.20 Euros. (CA-00035895-002).

Unfair Dismissal