Complainant

Respondent

Parties

Adam Brien

Persian Properties UC

Complainant

Respondent

Representatives

Andrew King BL

Not represented

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-00040414-001

14/10/2020

On July 16th 2018, the complainant commenced working as a food and beverage manager in the respondent’s Davenport Hotel.  He said that he worked in their other hotels also.  He earned an annual salary of €38,000, which was reduced by 10% at the start of the Covid-19 pandemic in March 2020.  The complainant was made redundant on October 14th 2020.  His complaint is that redundancy of his job was not genuine and his dismissal was unfair.  The respondent’s case is that the dismissal was fair, and that the complainant’s job was redundant.

Background to the Company and its Operation During the Pandemic

The respondent runs four hotels in Dublin, and their business has been decimated by the effect of Covid-19.  Apart from the income from a tiny number of room reservations in one hotel, on the day of this hearing in January 2022, they had virtually no revenue since March 2020.  By the end of that month, 180 employees had been temporarily laid off and there had been 25 redundancies.  Of those who remained at work, employees earning salaries over €35,000 were asked to take a 10% pay cut.  For eight weeks from April 1st 2020, the retained employees were instructed to work for three days a week and to take holidays for two days.  By the start of August 2020, when the complainant was made redundant, the headcount at the respondent’s four hotels was reduced from 294 to 95.

In late July 2020, the government’s decision to replace the Temporary Wages Subsidy Scheme (TWSS) with the Employment Wage Subsidy Scheme (EWSS) had the effect of increasing the cost of payroll for the respondent by approximately €74,000 per month, adding to already significant losses.  This is the context in which further “unpalatable but necessary” decisions were required to protect the business.

With restrictions lifted from August 10th 2020, the respondent decided to re-open one hotel, the Alex.  The occupancy rates after the re-opening was 5% of available rooms, with forward bookings extremely weak and little prospect of the other three hotels opening for the remainder of 2020 or into 2021.  The respondent’s submission stated that, on the date of this hearing in January 2022, apart from the Alex Hotel, they did not expect their other three hotels to open until mid-2022 at the earliest and they continued to make significant losses.

Engagement with Employees

On March 13th and 16th 2020, employees were informed in memos from the HR department that the hotels were closing and that lay-offs and short-time working would be introduced.  On March 17th, employees earning more than €35,000 were requested to take a reduction in pay.  The complainant’s wages were reduced by 10%.  By the end of March, 25 jobs had been made redundant and 180 employees were laid off.  The respondent made up the short-fall in wages for remaining employees who were in receipt of the TWSS, many of whom were working short-time.

The effect of the introduction of the EWSS at the end of July 2020 resulted in a meeting of senior management on August 4th to discuss roles that were not essential to keeping the Alex Hotel open.  All employees were invited to a “town hall” meeting on August 7th.  At the meeting, the chief financial officer (CFO) explained that the Alex would open on August 10th but with no prospect of the other three hotels opening, further redundancies were necessary.  The complainant was one of 17 roles identified for redundancy and this was confirmed to him at after the town hall meeting, at a meeting he attended with Mr Paul Joy, the general manager of the Alex Hotel and Ms Samantha Shepherd, group director of HR.

The Company’s Arguments in Response to the Claim of Unfair Dismissal

While the complainant was dismissed due to redundancy, the respondent’s submission notes that consideration was given to lay-off.  However, as the company decided not to open a second hotel for at least nine months, their view was that it would be unfair to employees to expect them to stay committed to the company when there was no work for them to do for a considerable length of time and they could get work elsewhere.

The decision to implement redundancies was taken only after all the alternatives were explored, including lay-offs, pay reductions and reduced working weeks.  The complainant was the only person in the role of food and beverage manager in the Davenport Hotel and, apart from the Alex, it was not anticipated that any other hotel would open for at least nine months.  At the time of his dismissal on August 7th 2020, there were no vacancies in the support office or anywhere else in the business.

In response to the complainant’s allegation that no consultation took place before he was made redundant, the respondent’s submission notes that he was present at a town hall meeting on August 7th 2020, at which all the employees were advised about the precarious financial predicament that the company faced.  The Alex Hotel was due to open, but the other three hotels were not expected to open until at least the second quarter of 2021.  Significant losses were forecasted for 2021 due to low occupancy rates and the company faced unsustainable cost increases of €74,000 per month arising from changes in the TWSS scheme.

The August 2020 town hall meeting was convened following extensive previous engagement with employees.  Copies of emails from the HR director to the employees were submitted in evidence.  The respondent asserted that employees were aware of the risk of redundancies and of the measures that had already been implemented, such as lay-offs, reduced working and reduced pay.  It was apparent that these measures might not be sufficient to avoid further redundancies.

The complainant was one of several employees called to separate meetings after the town hall meeting on August 7th.  As there was no plan to re-open the Davenport Hotel, the management explained that they had no choice but to make his job redundant.  He was informed that he would be paid statutory redundancy and four weeks’ pay in lieu of notice.  He was also told that the decision was not a reflection on him or his work, as he had been recognised as Manager of the Year in 2019 and he had been nominated for a prestigious Irish Hospitality Industry award.  In the circumstances where there was no alternative role available for the complainant, it is the respondent’s position that consultation over a longer period would have been futile.

In response to the complainant’s allegation that he was not permitted to bring a witness to the meeting on August 7th, it is the respondent’s case that there is no legal requirement for an employee at risk of redundancy to have a witness present.  As he was a manager, it would have been difficult to select a witness because other managers were affected by the respondent’s decisions.  On the day that the complainant was made redundant, 11 other roles were also made redundant and others left on agreed terms.

Conclusion

It is the respondent’s case that the complainant was dismissed due to redundancy.  There were compelling business and economic reasons and the global pandemic was unprecedented.  The company applied fair and reasonable procedures and the dismissal on the grounds of redundancy was fair.

Evidence of the HR director, Ms Samantha Shepherd

In her direct evidence, Ms Shepherd referred to the meeting on August 7th 2020, attended by 94 employees.  She said that 17 were at risk of redundancy.  After the main meeting, the 17 individuals were asked to attend meetings with their line managers.  Ms Shepherd attended the meeting with the complainant and Mr Paul Joy, the manager of the Davenport Hotel.  They explained to the complainant that his job was redundant.  Ms Shepherd said that the complainant was very shocked and upset and he finished up that day.  She said that he was a good food and beverage manager and from March to August 2020, he had been working in a support role and doing other jobs.  In response to the question why the 17 people who were made redundant on August 7th were not simply laid off, Ms Shepherd said that it didn’t seem fair to keep them attached to the company.  She said that this would give them false hope.

Cross-examining of Ms Shepherd

On behalf of the complainant, Mr King asked Ms Shepherd why the company didn’t write up a policy or procedure for making people redundant.  He suggested that there was an opportunity between March and August 2020 to do this work.  Ms Shepherd agreed that no procedures were developed.

Mr King asked what selection procedure was used to decide that the complainant’s job was redundant.  Ms Shepherd said that selection was based on the role of the employee. 

Mr King said that, prior to August 7th 2020, the last communication with the complainant about the risk to jobs was in March.  Ms Shepherd said that there was a constant conversation with employees about how to manage during the pandemic.

Mr King put it to Ms Shepherd that, at the meeting of August 7th 2020, the complainant was handed a letter in which he was informed that his job was redundant.  The decision had been reached before the meeting took place.  Ms Shepherd agreed that the complainant did not receive two weeks’ notice of the fact that his job may be made redundant.  However, she said that he was given an opportunity to consider if other roles were available.  She said that no reasonable alternative job was available for the complainant.

Referring to section 12 of the Redundancy Payments Act 1967, Mr King addressed the respondent’s assertion that lay-off was not a consideration.  Ms Shepherd replied that they did not intend to open another property and that they felt that it was fairer to make people redundant.  If they had been laid off, she said that they would have become entitled to redundancy at some point.  Mr King said that section 12 of the Redundancy Payments Act did not apply at the time, as the Act had been amended to prevent employees who had been laid off from applying for redundancy.  Ms Shepherd said that, when the Act was amended, they didn’t know how long the amendment would apply.  She said that the complainant’s job did not exist and that the management thought that redundancy was a fairer option.  Mr King pointed out that there was no discussion with the complainant about this assumption.  Ms Shepherd said that there was no discussion about other roles, reduced hours or voluntary lay-off.

It is apparent that, in May or June 2021, the respondent had a vacancy for a restaurant manager.  Ms Shepherd agreed with Mr King that the complainant has the skills required for the job of restaurant manager. 

Concluding her evidence, Ms Shepherd said that the complainant was a respected manager and that they felt it would be unfair to place him on lay-off without any clear indication of when work would be available.  She said that there were many vacancies at the time that the complainant could apply for outside the hotel business.  The fact that he changed his career and started to train as a special needs assistant (SNA) indicates that he may have intended to do that anyway.

Evidence of the Manager of the Davenport Hotel, Mr Paul Joy

Mr Joy said that, from, March until August 2020, he was focussed on trying to find work that people could do in the hotel.  He said that the four hotel managers split up the people who were reporting to them and they put up rosters every week.   He said that they spoke to their teams every day, although sometimes, there was no work to do.  Sometimes they permitted people to take more holidays than they were due.  Mr Joy conceded that, at the meeting on August 7th 2020 at which he was told that his job was redundant, the complainant was in shock. 

Cross-examining of Mr Joy

Mr Joy said that he attended four or five meetings out of the 17 that were held with individual employees on August 7th.  He said that people were collaborative, and there they had personal and professional relationships with their staff.

Evidence of the Chief Financial Officer, Mr Eoin Likely

Asked about the difference between the supports provided by the TWSS and the EWSS, Mr Likely said that the difference was an increase of €74,000 per month in payroll costs.  He said that the TWSS system provided a percentage of the average weekly net pay, up to a ceiling of a salary of €76,000.  The employer could top up wages.  The EWSS scheme provided a flat contribution to the employer.  By July 2020, it was based on a fixed amount for each employee.  From July 2020 onwards, the respondent received a lower contribution in government supports.  Mr Likely said that they then realised that the pandemic would go on for longer than they expected and that they needed a change of mindset.

Mr Likely said that the overall payroll cost was €350,000 per month and that it was his job to alert the directors to the scope of the losses.

Cross-examining of Mr Likely

Asked about the possibility that the complainant could have been retained in employment on the EWSS scheme, Mr Likely said that the employer has to top up wages, because employees must be paid the wages to which they are entitled.  Under the EWSS scheme, €203 per week is paid to the employer for every employee at work.  Less is paid for employees whose wages are less than €203.

In the e-complaint form he submitted to the WRC on October 14th 2020, the complainant said that, on August 7th 2020, he was asked by Mr Joy to set up a meeting room for a town hall meeting with employees at 12.00pm.  At the meeting, employees were informed that there would be further redundancies, adding to the group of 25 who were made redundant in March.  At 1.30pm, the complainant was summoned to a meeting with the HR director, Ms Shepherd, and the hotel manager, Mr Joy.  He was told that he was being made redundant with immediate effect.  He was asked to return all company property and to leave the hotel. 

The complainant said that there was no consultation with him and no opportunity to bring someone to the meeting.  He received no further information at the meeting and no termination date was specified in the letter confirming his redundancy. 

The complainant said that his Revenue record showed that his last day of employment was August 31st 2020, and for this reason, he couldn’t claim social welfare benefit for three weeks after he was dismissed.  He said that this impacted on his entitlement to the pandemic unemployment payment (PUP) Christmas bonus.  The complainant said that he didn’t receive his redundancy payment until after August 31st.

The complainant argues that he was part of a collective redundancy and that the Minister for Employment Affairs and Social Protection should have been notified.  He also said that a 30-day notice period should have been invoked.

On August 21st 2020, the complainant said that he met Ms Shepherd to discuss an agreed settlement in respect of the termination of his employment.  He refused to accept an “ex gratia” sum in addition to his statutory entitlement of €5,810.77.  As part of the settlement, the HR director agreed to write off €1,171.68 in respect of holidays taken by the complainant, but not due.  The complainant said that he refused to sign the settlement, because he didn’t take holidays between February and August 2020 and he claims that he is due pay in lieu of two weeks’ holidays.  In the end, the complainant said that €1,171.68 was deducted from his final pay.

In his submission, the complainant also referred to the deduction of 10% of his wages, which was applied without consultation and without his agreement.  He claimed that if he had not signed the document agreeing to the deduction, he would have lost his job.  The complainant submitted that his redundancy pay should have been based on his actual pay before the March 2020 deduction.

In his closing remarks, Mr King referred to the decision of my colleague, Pat Brady, in ADJ-00028929, A Service Technician v A Ventilation Company.  Mr Brady found that, while the respondent went through a very difficult time, the government had put in place facilities to maintain the link between employees and their employer.  Mr King argued that this decision reflects the circumstances the respondent was in by August 2020, but that fair procedures were not followed.

Evidence of the Complainant

 In his direct evidence, the complainant summarised his career in the hospitality industry since he was aged 16.  He worked in various well-known hotel businesses, and he was recruited by the respondent in July 2018.  He said that his ambition was to be a group operations manager.  The complainant said that there were no concerns about his work and, in 2019, he was selected by the respondent as Manager of the Year.

Mr King asked the complainant about his appointment as food and beverage manager in the Davenport Hotel, and his “utilisation” in other properties.  The complainant said that he was regularly asked to go to the other hotels, to fill in for someone who was absent, or to work on updating the tils, to upload new menus or to assist with big events.

Mr King referred to the email sent to employees on March 13th 2020 which indicated that “your manager will meet with you” to discuss the impact of the closure of the hotels due to Covid-19.  The complainant said that he had no meeting with his manager.  On March 16th, three of the respondent’s hotels closed and some employees were laid off.  The complainant was not laid off.  He referred to the form he was asked to sign dated March 17th 2020, regarding the 10% reduction in pay.  He said that this was handed to him at the bar counter in the Davenport Hotel and that he was told that if he wanted to keep his job, he should sign the form.  He said that he was more than willing to accept the pay cut, but no manager discussed it with him, and he wasn’t advised that there was anyone that he could talk to about it.

Mr King referred to the letter of March 20th 2020, which informed the employees who were still at work in the Alex Hotel, that many of their colleagues had been laid off due to the closure of the other three properties.  A letter dated March 27th 2020 is included in the respondent’s book of documents.  The letter sets out the company’s approach to the application of the TWSS.  The complainant said that he didn’t receive this letter and that he saw it for the first time in the respondent’s submission for the hearing.

The complainant said that his last formal engagement on the effect of the Covid-19 pandemic on the hotels was on March 27th 2020.  The next time a discussion took place was on August 7th at the town hall meeting and at the meeting that followed, when he was informed that his job was redundant.

At the time, in early August 2020, the complainant said that he was coming into the Alex Hotel for three days a week and he was working from home for two days.  When he was working at home, he re-wrote the standard operating procedure for the food and beverage departments of the four hotels.

On August 7th 2020, the complainant said that he arrived at work between 9.00am and 9.30am.  He and his colleagues were getting ready to open the Alex Hotel, doing deep-cleaning, stock-taking and updating the drinks prices.  At 11.00am, his manager, Paul Joy, asked him to set up a room for a meeting with staff at 12.00pm.  Around 50 employees were at the meeting.  They were informed that more redundancies were necessary and that managers would speak to individual employees.  The complainant said that he spoke to his manager, Mr Joy, who said that he didn’t know anything.  He said that it was very nerve-wracking, trying to work and not knowing if his job was at risk.  He said that his crew were asking him about their jobs.

At 12.45pm, the complainant said that he noticed that his email was turned off and he had no access to the company’s computers.  He said that he knew then that he was being made redundant.  He was called to a meeting at 1.30pm.  He said that he was shaking as he went in.  His manager, Mr Joy was at the meeting.  He noticed a pile of paperwork in front of the HR director.  They said, unfortunately, they had to let him go.  He was asked to hand over the keys he had to any of the company’s properties and then to leave.  There was no discussion about an alternative role, reduced hours or reduced pay.  He said that he never thought about asking if he could be laid off instead of being made redundant.  He said that Mr Joy said that he was very sorry about having to let him go.  The meeting lasted about 15 minutes and he was handed a letter before he left.

In his evidence, the complainant also referred to the meeting he had with Ms Shepherd on August 21st to discuss the possibility of an agreed settlement. 

The complainant referred to positions in the respondent’s hotels that became vacant since he was dismissed in August 2020.  In May 2021, he said that he saw a vacancy advertised for a restaurant manager’s job.  He said that the role “looked like another one of me.”  On September 21st, a job for a conference and banqueting manager was advertised.  He said that this is the same as the job of meeting and events manager that he did previously.  The complainant said that he could also have taken on a job as a front of house manager, and, with training, he could have worked as a reservations manager.

At the end of his direct evidence, the complainant said that on August 7th 2020, if he had been asked if he was willing to be placed on lay-off, he would have agreed.

Mr King asked the complainant about his earnings now compared to his earnings with the respondent.  In 2019, he said that he earned just under €40,000 with the respondent.  From September 1st 2020, he claimed the PUP.  In 2021, he re-trained as an SNA and he now works for the Department of Education.  In 2021, he earned just under €15,500 as an SNA.  He also had income of €7,000 from the PUP and job-seeker’s benefit.  As a qualified SNA, he now earns €377 per week, equivalent to an annual salary of €19,604. 

In response to questions from me, the complainant said that he believes he was made redundant because the hotels were affected by the Covid-19 pandemic, and he doesn’t suspect that there was any other reason.

During re-direction by Mr King, the complainant again referred to the fact that, according to the Revenue Commissioner’s website, his employment ended on August 31st 2020.  He said that this affected his ability to claim the PUP for the final three weeks of August.

Cross-examining of the Complainant by Mr Paul O’Callaghan, Chief Executive Officer

In response to a question from Mr O’Callaghan about the staff situation during Covid-19, the complainant said that he tried to keep up morale with his colleagues.  He said that he didn’t think that, after March, there would be more redundancies.  He was occupied re-writing the standard operating procedure for the food and beverage departments. 

Mr O’Callaghan asked the complainant if he thought that his manager was aware that he was working from home for two days a week.  He said, “we have no knowledge you were working from home.”  The complainant replied that Mr Joy and another manager, Mr Woods, knew he was working from home.  He said that they phoned him when he wasn’t in the hotel and it was obvious that he was at home.

Mr Joy interjected to say that they permitted employees to take holidays until they were used up and then they could work from home.

Mr O’Callaghan asked the complainant why he didn’t apply for the vacancy for a restaurant manager in May 2021.  The complainant replied, “because you let me down the first time.”

Mr O’Callaghan referred to the fact that, in August 2021, the complainant was offered a job in another hotel.  He asked the complainant why he went for the interview for this job, when he claimed that he was “scarred by the industry.” The complainant said that after the interview, he realised that he didn’t want to go back to the hotel business.

Mr O’Callaghan asked, “if you were in our shoes, what would you have done?”  The complainant said that supervisors were not made redundant, and if he had been laid off, he would have waited until the hotels re-opened.

Mr O’Callaghan asked, “where did we fall down on procedures?”  The complainant referred to the fact that he was brought to a meeting and “told I was gone.”

Referring to work that he did across the group, the complainant said that if the tils were down, he sorted them out.  He regularly worked in other hotels and managers phoned him for help.  Mr Joy said that the complainant had a lot of experience on the “Epos” til system and that he helped out with functions on a handful of occasions.    

The Legal Framework Regarding Redundancy

The definitions of redundancy at section 7 of the Redundancy Payments Act 1967 (as amended) (“the RP Act”) is the starting point for a consideration of the complainant’s case that his dismissal by reason of redundancy was unfair.  Section 7(2) provides that,

“(2)…an employee who is dismissed shall be taken to be dismissed by reason of redundancy if, for one or more reasons not related to the employee concerned, the dismissal is attributable wholly or mainly to—  

(a)…the fact that his employer has ceased, or intends to cease, to carry on the business for the purposes of which the employee was employed by him, or has ceased or intends to cease, to carry on that business in the place where the employee was so employed, or

 (b) the fact that the requirements of that business for employees to carry out work of a particular kind in the place where he was so employed have ceased or diminished or are expected to cease or diminish, or

(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 been doing before his dismissal) to be done by other employees or otherwise, or

(d) the fact that his employer has decided that the work for which the employee had been employed (or had been doing before his dismissal) should henceforward be done in a different manner for which the employee is not sufficiently qualified or trained, or

(e) the fact that his employer has decided that the work for which the employee had been employed (or had been doing before his dismissal) should henceforward be done by a person who is also capable of doing other work for which the employee is not sufficiently qualified or trained.”

Considering that, from March 2020, the hotel where the complainant worked was closed, the decision to make his job as food and beverage manager redundant would appear to fall under the description of redundancy at sub-sections (a), (b) and perhaps also, (c) above.  However, it is apparent from the evidence given by the respondent’s witnesses, that they intend to resume normal trading as soon as Covid-19 restrictions are lifted, so the cessation of business, referred to at (a) and (b) will be temporary.  Considering sub-section (c), the fact that the employer decided to carry on the business with just a skeleton crew, was also bound to be temporary, as a full crew will be required to when the hotel re-opens.

Lay-off

A temporary cessation of business is provided for at section 11(1) of the RP Act by the introduction of the facility for lay-off.  (Sub-section 2 is not relevant for our purposes here).

“(1)  Where an employee’s employment ceases by reason of his employer’s being unable to provide the work for which the employee was employed to do, and -

(a)  it is reasonable in the circumstances for that employer to believe that the cessation of employment will not be permanent, and

(b)  the employer gives notice to that effect to the employee prior to the cessation,

that cessation of employment shall be regarded for the purposes of this Act as lay-off.”

The evidence of the respondent’s witnesses is that 180 out of almost 300 employees were placed on lay-off in March 2020, and, at the date of this hearing, on January 17th 2022, they were still laid off.  The HR director and the CEO said that they decided to make the complainant redundant, so that he could look for another job elsewhere and they considered that this was fairer than laying him off.  I have a difficulty with this explanation because, if the complainant had been laid off, there would have been nothing to prevent him from taking a job temporarily with another employer and returning to work when the hotels re-open.  It seems to me that it would  have been fairer to keep the option open of returning to his job.  If he had been laid off, he would have been entitled to claim the PUP, which he did when he was made redundant, or he could have got another job, which, eventually, he did.  However, if he had been laid off and not dismissed, his career in the respondent’s hotel business, and his relationship with them would have been maintained.  This was precisely the objective of the government schemes such as the EWSS and the PUP; their purpose was to maintain the connection between employers and employees during the pandemic, and to avoid job losses.

Was the Complainant’s Job Redundant?

When the complainant was made redundant at the beginning of August 2020, the respondent’s managers had no idea that it would be another 19 months, around April 2022, before a return to some normal business might be possible.  In that scenario, they literally battened down the hatches, opened one hotel and kept their other three properties maintained and secure, until they were permitted to fully open for business again.

From the perspective of this complaint, it is interesting to note that the managers never contemplated closing down or selling any of their properties, or changing their use.  At least, no evidence was given of any such considerations and it seems that they set their sights on riding out the storm until they could open again.  In such a scenario, it is obvious that the job of the complainant, and other jobs that were laid off or made redundant, were going to be needed when the business opened up again.  For this reason, I find that the complainant’s  job as food and beverage manager was not redundant, but that it was simply not required for the duration of the pandemic.  It is disturbing to note that when a vacancy arose for a restaurant manager in May 2021, the position was advertised on a jobs website, and no one from the respondent’s business contacted the complainant to ask him if he was interested in the role, although their evidence was that he had the skills and experience to do the job. 

I find that, as the complainant’s job was not redundant, he should not have dismissed in August 2021, but like 180 of his colleagues, he should have been laid off. 

Was the Process Fair?

Section 6(4)(c) of the Unfair Dismissals Act 1977 (the “UD Act”) recognises the right of an employer to dismiss an employee due to redundancy: 

 “…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

(c) the redundancy of the employee.”

Subsections (a), (b) and (d) of this section are not relevant to this complaint.

We know from section 6(3) that this right is predicated on an obligation to select employees for redundancy on the basis of fairness and to adhere to an agreed procedure or a code of practice regarding dismissals.  Section 6(7) was inserted by the Unfair Dismissals (Amendment) Act 1993 and expands further on the issue of reasonableness.  This 1993 addition to the UD Act provides that, when considering a complaint of unfair dismissal, I, as the adjudicator, may have regard,

“(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.”

In the case of this former employee, he was not a member of a trade union no evidence was submitted of the existence of a procedure for implementing redundancies.  In the absence of an agreed procedure, the respondent was required to ensure that the fair procedures that apply in the case of any dismissal were afforded to the complainant.  These include the right to notice, the right to be represented at meetings, the right of the employee to respond to the employer’s decision to make his job redundant and the right of appeal. 

In three newsletters in March 2020, the complainant and his colleagues were informed about lay-offs, wage reductions and compulsory holidays.  Almost five months later, on August 7th 2020, he attended a “town hall” type meeting for the remaining staff and afterwards, he was called to a meeting at which he was informed that his job was redundant and that his employment was terminated with immediate effect.  He received four weeks’ pay in lieu of notice.  While I accept the evidence of the hotel manager who said that there were daily conversations about what would happen next, there was no discussion whatsoever with the complainant about the redundancy of his role before the date on which he was dismissed.  I accept as valid, the point raised by Mr King that, while there was very little to do apart from maintenance and staff training between March and August 2020, one useful thing that could have been done was the drafting of a redundancy procedure.

The process of making the complainant redundant started and ended at a meeting on August 7th 2020.  He received only minutes’ notice, he was not informed of the purpose of the meeting in advance, nor was he offered the chance to bring someone with him.  While the HR manager said that the complainant was a valued employee with transferable skills, no discussion took place with him about the possibility that his dismissal could be avoided. 

There are many authorities for the requirement to deal fairly with an employee whose job is at risk of redundancy.  I refer to the decision of the former Employment Appeals Tribunal in its decision in Mulligan v J2 Global (Ireland) Limited, UD 993/2009:

“In cases of redundancy, best practice is to carry out a genuine consultation process prior to reaching a decision as to redundancy.  While in some cases there may be no viable alternative to the making of one or more jobs redundant, whatever consultation process is carried out, the employer who fails to carry out a consultation process risks being found in breach of the Unfair Dismissals Act as such a lack of procedure may lead to the conclusion that an unfair selection for redundancy had taken place.”

I accept the huge challenges faced by this employer, and the fact that, up to the date of this hearing on January 17th 2022, their business had been closed for two years.  These difficulties do not relieve them of the requirement to act reasonably when it comes to making an employee redundant, to consider all possible alternatives and to involve the employee in the final decision.

Conclusion

In conclusion, I find that a redundancy situation did not exist in August 2020, when the complainant was dismissed.  I am satisfied that it would have been fairer, and ultimately more in line with the government’s intention during the pandemic, for him to be laid off for however long the business was closed.  From a substantive and procedural perspective, I find that the dismissal of the complainant was unfair. 

I have decided that this complaint is well-founded.  Of the redress options available, the complainant selected compensation.  The parameters within which I am required to consider the amount of compensation to be awarded are set out at section 7 of the UD Act under the heading, “redress for unfair dismissal.”  Sub-section 1 provides that any award of compensation may not exceed 104 weeks’ compensation.  Sub-section 2, provides further guidance:

Without prejudice to the generality of subsection (1) of this section, in determining the amount of compensation payable under that subsection regard shall be had to –

(a)  the extent (if any) to which the financial loss referred to in that subsection was attributable to an act, omission or conduct by or on behalf of the employer,

(b)  the extent (if any) to which the said financial loss was attributable to an action, omission or conduct by or on behalf of the employee,

(c)  the measures (if any) adopted by the employee or, as the case may be, his failure to adopt measures, to mitigate the loss aforesaid,

(d)  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 subsection (1) of section 14 of this Act or with the provisions of any code of practice relating to procedures regarding dismissal approved of by the Minister,

(e)  the extent (if any) of the compliance or failure to comply by the employer, in relation to the employee, with the said section 14, and

(f)  the extent (if any) to which the conduct of the employee (whether by act or omission) contributed to the dismissal.

As I have set out above, it is my view that the complainant’s job was not redundant, he should not have been dismissed and, instead, he should have been laid off until the hotel where he worked re-opened in 2022.  The failure of the respondent to follow any reasonable process in the lead-up to the complainant’s dismissal compounds the unfairness of their actions.

The complainant had a responsibility to mitigate his loss and in 2021, he decided to re-train as a special needs assistant.  By the date of this hearing in January 2022, he was employed, but in a job that paid approximately half of what he earned with the respondent, with shorter hours.  The complainant’s salary as a food and beverage manager was €38,000 and his current salary is €19,604.  I recognise that it remains open to him to seek a higher-paid job in the hospitality sector in the future.

Taking all these facts into account, I decide that the respondent is to pay the complainant €28,500, equivalent to nine months’ salary when he worked for the respondent.  As this compensation is in the form of loss of earnings, it is subject to the normal statutory deductions.

Redundancy, lay-off