Complainant

Respondent

Parties

David  Walsh

 Bathshack IE Ltd T/A Bathshack

Representatives

 Self-represented

Self-represented

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-00041028-001

14/11/2020

The Complainant was employed as a Salesperson with the Respondent from 2 August 2017 until the date of his dismissal. He earned €1666.67 gross; €1551.74 net monthly, based on a 40-hour week. The Complainant submits that he was unfairly selected for Redundancy which constituted unfair dismissal. He received €2,861.00 as a statutory redundancy sum. The Respondent submits that it acted properly at all times in managing the Complainant’s dismissal which it contends was a valid redundancy situation and therefore not unfair dismissal.      

Preliminary Issue -Date of Dismissal:

The Respondent submits that the actual date of dismissal was 19 January 2021, whereas the Complainant submitted the complaint to the Workplace Relations Commission on 14 November 2020., thus negating the validity of the complaint.  The Head of Business Support, with responsibility for accountancy and HR matters (hereinafter the HR Manager), stated that a letter to the Complainant, which was exhibited at the hearing, indicated a confirmation of the conclusion of the redundancy consultation and selection process, which has a leaving date of 19th January 2021.

  The Head of Business Improvement (hereinafter ‘the Business Manager) stated that he rang the Complainant on 29 October 2020 but only to tell him that his job was at risk of redundancy but rejects the assertion by the Complainant that he (the Business Manager) had told him he was dismissed.

Substantive Issue – Redundancy Dismissal

The Respondent submits that the impact of COVID-19 was severe on the business causing enforced closure of stores initially, then moving to appointment only, which was still the case in some stores. The Respondent asserts that the need for social distancing and to keep people safe meant that it    had to reduce number of appointments in store and reduce staff numbers in store as a result.

The HR Manager gave evidence that a letter was issued from the CEO to all staff on 1 June 2020 about the possibility of redundancies as result of the uncertainty, cashflow concerns and lack of store income.

The Respondent submits that in October 2020 it was agreed to reduce the number of sales’ staff by one in the Cork store. The Respondent contends that the performance and attitude of the Complainant was not up to the standard of the other sales person in the store. The Complainant also had a disciplinary verbal warning in February 2020. It was decided to let the Complainant go based on the standard evaluation process. The procedures state that all redundancies must be confirmed in writing.  The Complainant was written to on 23 November 2020 to confirm selection for redundancy and advised that if he had any queries or needed more information to contact the HR Manager. The Complainant was given 4 weeks’ notice plus holiday allowance, with a leaving date of 15th January 2021 and final payslip in January 2021. He also received a statutory redundancy sum of €2,861.  The Respondent’s Redundancy Policy has an appeal procedure, but the Complainant did not pursue this route.

The HR Manager gave evidence that the Respondent has set procedures to follow as part of the Employee Handbook that was issued in 2019. She outlined how stores and all functions across the business were reviewed monthly at senior management meetings, resulting in seven redundancies across the business – all of these were conducted in line with the company policy, none of these redundancies resulted in complaints, appeals or further issues. She stated that she had responsibility for evaluating employee positions to determine who should be made redundant. She said that all the redundancies were carried out consistently in reference to a standard evaluation sheet based on ‘Sales, Conduct and Attendance’. The company CEO would hear any appeals; however, none were forthcoming, neither was one submitted by the Complainant. The HR Manager stated that the Business Manager would not have had the authority to tell the Complainant that he had been made redundant and she therefore understood that the sole function of the phone call by the Business Manager was to consult with the Complainant as per the Respondent’s Redundancy Policy. 

The Business Manager in evidence could not recall if he had consulted the Redundancy Policy, specifically with regard to the evaluation process based on ‘Sales, Conduct and Attendance’ as outlined by the HR Manager, when he spoke with the Complainant by phone on 30 October 2020. 

Preliminary Issue-Date of Dismissal.

The Complainant stated that he sent a text to the Business Manager on 29 October 2020 looking for an update on his position. He had been on the Covid-19 support payment, whilst not required to attend at work, but he was aware that the store was open.  The Business Manager rang him later that day to tell him that his job was gone but that he would try to arrange a month’s pay for him as a gesture of goodwill.  The Complainant refutes the position of the Business Manager that the purpose of the phone call was part of the consultation process in the Respondent’s Redundancy Policy, but instead was one of notification of dismissal.  He said that he was very upset to learn that he had lost his job and told his family immediately.

The Complainant said that he never received the letter of 23 November 2020 from the CEO, which the Respondent exhibited, but instead requested it from the HR Manager by email afterwards.  

Substantive Issue – Redundancy Dismissal.

The Complainant stated that when he queried the Business Manager, in the phone call of 29 October 2020, as to why he was selected over other employees for redundancy, he was told that the company was not doing great and they had to make cuts. The Complainant contented that there was   an employee who came in 2.5 years after him with less experience and skills. He argues that he was also involved in the recruitment of this said employee, so he believed he was unfairly selected over other employees for redundancy.

He stated that the he first got site of the Redundancy appraisal sheets in the summer of 2021 before the first scheduled hearing by the Workplace Relations Commission.    

Preliminary Issue – Date of Dismissal.

The Respondent submits that the date of dismissal was 21 January 2021 as was outlined in the CEO’s letter to the Complainant of 23 November 2020. The Workplace Relations Commission (WRC) recorded that the complaint of unfair dismissal was received on 14 November 2020 therefore if I find as a fact that the Respondent’s position is correct, I do not have jurisdiction to hear the claim because the complaint would have been submitted before the actual dismissal took place.

I note in the evidence of the Business Manager that he was quite clear that he did not state that the Complainant was dismissed in the 29 October phone call but that the purpose of the call was for consultation purposes only. However, when he was pressed on the nature of the precise nature of the consultation process during the phone conversation, he admitted that he had not a clear recollection of that aspect of the call.

The Complainant stated on the other hand that the Business Manager told him that his job was gone from that point on and that he should look for a new job. He gave evidence he was very upset when told this by the Business Manager on the phone. I find it improbable that an employee who was ostensibly being consulted on proposed redundancies in the business on 30 October should submit a complaint for unfair dismissal to the WRC on 14 November, unless he believed he had been dismissed.

The Respondent refers to a letter sent by post to the Complainant from the CEO on 23 November as confirmation of redundancy. I note that that this letter was written after the Respondent had been informed that the Complainant had submitted a complaint to the WRC. I note also in evidence that the Respondent kept no record of postage of this letter and that the Complainant gave cogent evidence that he never reived such a letter by post.

 On hearing the evidence on this issue, I find that, on the balance of probabilities the Business Manager did tell the Complainant that his job was gone on 29 October 2020 and that the relevant date of dismissal for the purposes of this decision is 29 October 2020, therefore, I conclude that the complaint has been validly submitted.

Substantive Issue-Redundancy Dismissal

The applicable law:

Section 6(1) of the Unfair Dismissals Act 1977 provides that: - 

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.

Section 6(4)(c) of the 1977 Act provides that: -  

Without prejudice to the generality of subsection (1) of this section, the dismissal of an employee shall be deemed, for the purposes of this Act, not to be an unfair dismissal, if it results wholly or mainly from ... the redundancy of the employee...

Section 6(7) provides that: -

 Without prejudice to the generality of subsection (1) of this section, in determining if a dismissal is an unfair dismissal, regard may be had, 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

(b) to the extent (if any) of the compliance or failure to comply by the employer, in relation to the employee, with the procedure referred to in section 14(1) of this Act or with the provisions of any code of practice referred to in paragraph (d) (inserted by the Unfair Dismissals (Amendment) Act, 1993) of section 7(2) of this Act.

Section 7(2) of the Redundancy Payments Act 1967, as amended, provides in Section 7(2)(c):

The fact that his employer has decided to carry on the business with fewer or no employees, whether by requiring the work for which the employee had been employed (or had being doing before his dismissal) to be done by other employees or otherwise.

Charleton J. in the High Court case of   JVC Europe v Jerome Ponisi [2012] 23 E.L.R. 70 stated:

           “That it may be prudent, and a mark of a genuine redundancy, that an employer prior to making an employee redundant examine alternatives to letting that employee go and conduct a fair selection procedure. As a matter of contract where selection processes for redundancy or a consultation process to discover alternatives to redundancy are contained in a collective agreement or an individual employment contract, these should be followed. That a fair procedure may be used to disguise deceptive conduct and followed in form only in order to mask an ulterior motive.”             

The first issue that has to be asked is whether there was a valid redundancy situation in the Respondent company. The burden of proof rests with the Respondent to establish that the dismissal was wholly redundancy connected and the Respondent must then justify that the process, whereby the Complainant was selected for redundancy, was fair and transparent in all respects.  Plausible uncontested evidence was submitted by the HR Manager/Accountant that sales had significantly dropped as a result of the Covid pandemic, and I am satisfied that the Respondent was faced with having to reduce costs and the decision to make the Complainant redundant was taken for economic reasons. I am therefore satisfied that a genuine redundancy situation existed at the time. However, in circumstances where redundancy is unavoidable, the Respondent is obliged to establish reasonable and objective criteria for selection and must apply those criteria fairly, as outlined by Charelton J. inPonisni

The Labour Court in Students Union Commercial Services Ltd v Traynor UDD 26/2017 referred to Mulcahy v Kelly [1993] E.L.R. 35, on the point that the duty of a Respondent in a valid redundancy situation may involve locating alternative work within the organisation even it this involves dismissing another employee with shorter service.

The Respondent submitted that there was a valid consultation with the Complainant on 30 October 2020, in line with the Respondent’s Redundancy Policy. I note that this Policy states:

Those employees provisionally selected for redundancy will be consulted individually and will have the opportunity to make representations on his/her selection or comment on the information used in his/her selection before redundancies are implemented.

In his evidence, the Business Manager could not recall consulting with the Complainant in line with the policy nor could he confirm as to whether he told the Complainant about the evaluation process when it came to decide as to who should be made redundant. Furthermore, the HR Manager confirmed that the evaluation sheet with the marks for the Complainant under various headings was not sent to the Complainant nor did she give evidence that she consulted with the Complainant during this process. (The Complainant received the results of his evaluation sheet prior to the scheduled WRC hearing.)         

The Respondent further argued that the Complainant did not use the appeal mechanism that was available to him. However, I note in the Redundancy Policy at 3.7, it states that a letter confirming redundancy will be sent containing, with amongst other things, “Details of the right to appeal against selection and the procedure to be followed”. I note that the purported letter confirming redundancy on 23 November did not contain such details. This was neither a contractual nor lawful obligation under legislation. Based on these circumstances, I find that the lack of recourse to an appeal was not a significant issue in this case.

The Respondent presented no evidence to demonstrate that it carried out any kind of fair, constructive or transparent consultation process, neither in line with its own procedures, nor as provided for in established law.  Entirely absent from the process was a constructive engagement with the Complainant and an exploration of ways to avoid his dismissal, and this was unfair.  On the basis of the evidence and reasons outlined above I find that the approach adopted by the Respondent was arbitrary and unreasonable, and therefore by reference to Section 6(7)(a) of the Act, the dismissal of the Complainant was unfair.

Redress:

Section 7 of the Act, in its relevant parts, provides:

7. Redress for unfair dismissal:  

(1) Where an employee is dismissed, and the dismissal is an unfair dismissal, the employee shall be entitled to redress consisting of whichever of the following the adjudication officer or the Labour Court, as the case may be, considers appropriate having regard to all the circumstances:

…. (c) (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 circumstances, or

(ii) if the employee incurred no such financial loss, payment to the employee by the employer of such compensation (if any, but not exceeding in amount 4 weeks remuneration in respect of the employment from which he was dismissed calculated as aforesaid as is just and equitable having regard to all the circumstances,

and the reference in the foregoing paragraphs to an employer shall be construed, in a case where the ownership of the business of the employer changes after the dismissal, as references to the person who, by virtue of the change, becomes entitled to such ownership.  

…. (3) In this section—

“financial loss”, in relation to the dismissal of an employee, includes any actual loss and 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 [2014], or in relation to superannuation;

“remuneration” includes allowances pay and benefits in lieu of or in addition to pay.

The Complainant gave evidence that he had secured employment at a higher rate of pay which necessitated a move to Dublin in March 2021. He gave evidence of attempting to mitigate his loss during Covid 19 Pandemic since his dismissal. I note also that the Employee received a redundancy payment of €2861. I order that the Respondent pay the Complainant the sum of €3000 which I believe is just and equitable having regard to all the circumstances of this case.

CA-00041028-001: I find that the Complainant was unfairly dismissed. I order the Respondent to pay the Complainant the sum of €3000 which I believe is just and equitable having regard to all the circumstances of this case.

Unfair Dismissals Act 1977, Unfair Selection for Redundancy, Date of Dismissal.