Complainant

Respondent

Parties

Bogdan  Vasarheli

Castolin Eutectic Ireland Ltd

Representatives

Dave Curran SIPTU

Peter Flood Ibec

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-00046375-001

24/09/2021

The complainant commenced employment with the Respondent as a Machine Operator in February 2017. He was paid on average €900 per week. He worked 39 hours per week. His employment ended on 4 June 2021. A complaint under the Unfair Dismissals Act was received by the WRC on 24 September 2021.

The respondent company supplies products to the car industry.

Two other complaints, CA-00035344-001 and CA-00046460-001 were withdrawn by the complainant at the outset of the hearing.

The respondent’s representative provided a detailed written submission.

The respondent submits that the complainant was fairly selected for redundancy in line with the agreed basis applied within the company, i.e., last in first out all other things being equal.

By way of background the respondent submits that the company has faced declining sales for its products in recent years.  In January 2021, the company conducted a review of its operational requirements and initially cease night shift working in its Flux Cord Wires section as a first step to reduce operating costs. In May 2021, a second review took place which concluded that there were 136 hours per week for Operators for which there was no work available; this equated to three full-time jobs on the factory floor.  However, there were critical jobs which had to be retained for the company to survive and others not deemed critical and could be made redundant.  The complainant worked in one of the non-critical jobs which had become redundant.

The respondent refers to the Company/Union Agreement, which states that the basis for selection for redundancy is, “where practical, operate a procedure based on service, all other things being equal.” The respondent submits that redundancy only applies if a role becomes redundant.  When selecting those to be made redundant a choice only needs to be made where there is more than one worker performing the redundant role.

The respondent refutes the complainant’s assertion that another employee, TB, who had shorter service than him, should have been made redundant and he should have been retained. The respondent puts forward that this employee TB was not performing the same role as the complainant, and that TB was the only operator competent and fully assigned to one of the jobs identified as being critical. Therefore, TB’s role was not redundant and thus there was no choice to be made between him and the complainant in relation to selection for redundancy.

The respondent submits that the complainant did not perform critical jobs. The three employees selected for redundancy were those with the shortest service performing non-critical jobs. These jobs were no longer required by the company.

The respondent also submitted that when the complainant had worked in one of the critical roles, he had found it difficult and had not performed as required. Following discussions with an external consultant about the position the respondent submits that the complainant accepted that work in this specific area was demanding and there had been issues with his performance. As a result, it was agreed that the complainant would move to another area with a concomitant reduction in pay and a lowering of his grade from Grade 5 to Grade 4.

Regarding consultation on the redundancies, the respondent submits that the CEO wrote to the SIPTU representative on 6 May 2021, requesting an on-line meeting to discuss the performance challenges facing the company.  A telephone meeting took place on 10 May 2021, during which the CEO informed the representative that there was a need for three redundancies. According to the respondent the SIPTU representative never disputed the number of jobs to be made redundant but there was a dispute in relation to the selection of the complainant for redundancy as he had longer service than one other employee (TB), who was being retained in the business.

On 20 May 2021, the SIPTU representative emailed the CEO alleging that the company had not adhered to the correct selection process for redundancy. The respondent refutes this allegation.

Referring to section 7 of the Redundancy Payments Acts 1967 to 2014, the respondent submits that the work performed by the complainant was no longer required or had diminished.  There were three workers affected by this situation.  The complainant was one of the three employees with the shortest service whose work no longer existed or had diminished. This is why he was one of the three workers selected for redundancy. His role had become redundant and therefore it was not an unfair dismissal to terminate his employment.

Referring to section 6 (3)(b) of the Unfair Dismissals Act, the respondent submits that there was a redundancy selection procedure agreed with SIPTU and the company adhered to that process.

The respondent’s CEO gave direct evidence at the hearing.  In his evidence he stated that the pandemic had reduced demand from the car industry for the company’s products and that several initiatives had to be undertaken such as close downs and 3-day weeks and the non-renewal of fixed term contracts. In addition, a review was undertaken and it recommended a reduction of three workers. 

The CEO stated that workers are trained to do a primary job and then a secondary job.  Some jobs are deemed to be core and some non-core.  When the decision on redundancies was being made, it was decided to remove non-core jobs.  Reviewing the matter, the complainant was deemed not capable of working in the Cord room, a core job (from where he had moved). TB on the other hand was deemed capable of working in the Cord room. Consequently, TB, although having less service than the complainant, was retained and the complainant, as the worker with the next least service, fell within the scope of the three redundancies.  This, according to the CEO, being allowed under the last in first out when all things are equal clause. The CEO added that the company had a surplus of people with longer service in the areas where the complainant was competent. 

The CEO stated that attempts had been made to contact the complainant about the situation, including a letter by registered post, but these attempts had been unsuccessful. He stated that a notice went up about redundancies on 10 May but the complainant was out sick at the time.  He believed the complainant had been made aware that his job was being made redundant in the week commencing 17 May. In response to a question on when the complainant was told he was being made redundant the CEO said he could not say.

In cross examination the CEO agreed that the idea of core and non-core jobs was not laid out in contracts of employment. He also categorically denied the civil action taken by the complainant against the company had influenced the decision to make him redundant.

The external mediator involved in the attempt to resolve matters related to the bullying claim made by a number of workers (referred to above), including the complainant, gave direct evidence at the hearing. The mediator stated that the complainant had suggested he would be prepared to work in another area (to move from the Cord room) and this move was agreed to by the company.

In conclusion, the respondent submits that it was entitled to restructure its business and reduce its workforce as it considered appropriate having regard to the operational requirements and financial considerations. Ultimately, the company was left with no option other than to make three jobs redundant. The respondent rejects the allegation that the complainant was unfairly selected for redundancy; he was one of the three workers with the shortest service whose work had ceased or diminished, the work of his comparator, TB, remained so no redundancy arose in his case. Therefore, the selection of the complainant for redundancy was in line with the procedure agreed between the company and SIPTU.

The complainant’s representative provided a detailed written submission.

The complainant submits that he was unfairly selected for redundancy on the following grounds:

(i) His selection was due in part to a prior civil case taken by him against the respondent.

(ii) That the agreed selection procedures of the Union/Company Agreement were not followed.

(iii) That the overall process was highly flawed.

The complainant submits that he had a good work record with the company and had completed numerous training courses on the various types of machines used in his workplace. As part of his contract, he was required to be flexible and rotate across different areas when required, as with all employees of the same grade. The complainant worked across several areas within the company.

In 2019, the complainant and other employees raised issues of alleged bullying by a member of management.  A mediator was engaged and following this the complainant was moved to avoid working with the person in question.

The complainant subsequently contacted the company about the outcome of the bullying complaint; however, no outcome was issued to him. A civil case was initiated by the complainant which went before the Circuit Court in 2019. Following this the company sought legal costs of €14,800 from the complainant.  Following discussions, the matter of costs was dropped.  The complainant submits that the attitude of management changed after he took the civil case.  Before the court case he had been well regarded and praised for his productivity, after it he found management continuously checking his work for errors.

In May 2021, while the complainant was out of work on sick leave, the company wrote to the employees’ SIPTU representative regarding redundancies in the company. The representative was informed that there would be three redundancies and the complainant was one of them. The complainant submits that this was despite the fact that another employee, TB, who worked in the areas identified for redundancies had less service than the complainant and was trained to work in fewer areas than the complainant.

The SIPTU representative wrote to the company CEO outlining his concerns that the Union/Company Agreement was not being adhered to in the complainant’s case. A dialogue ensued between the SIPTU representative and the CEO. The SIPTU representative re-iterating his concerns about the selection of the complainant and the CEO outlining his contention that the company were fully within their rights to select the complainant for redundancy.

The complainant’s employment was terminated on 4 June 2021. With attempts to resolve the matter locally unsuccessful, a referral was made to the WRC under the Unfair Dismissals Act.

The complainant submits that his selection for redundancy was at least partly linked to matters unrelated to his position, i.e., the prior (and at the time ongoing) bullying complaint and civil case against the company.  The complainant refers to section 6 (2) of the Act and submits that the company decided to “skip” over another employee and select him because he made an allegation of bullying and took a civil case against the company.

The complainant also submits that proper procedures as outlined in section 6 (3) of the Act were not followed as the company did not follow the procedures agreed in the Union/Company Agreement, which states in Section 9, dealing with Redundancies, “In the event of redundancy being declared the Company will, where practical, operate on a procedure based on service, all other things being equal.”  This being understood by both parties to mean, “last-in-first- out” is in operation. In this case another employee, TB, had less service than the complainant and he, the complainant, had worked in two of the three areas identified as requiring redundancies whereas this other employee had worked mainly in one area.  Both the complainant and this other employee TB were employed on the same contract as Machine Operators, and there is no contractual tie to any particular machine.

The complainant submits that the overall procedure was highly flawed for several reasons. Firstly, when written to by the company on 20 May 2021 he was told he had been “selected”, at no point was he advised that he was “at risk” of redundancy meaning there was no genuine consultation process or any discussion on alternative options. Secondly, no objective criteria were ever put forward by the company to explain how the employees were selected for redundancy, other than last-in-first-out. No documentation was provided by the respondent explaining the rationale behind the selection of people or areas liable to redundancy.

In his direct evidence at the hearing, the complainant stated that employees were moved around jobs on a regular basis and that the machine he was working on at the time leading up to the termination of his employment was similar to that where TB was working at the time. The complainant stated that he had moved from the area where TB was working in the aftermath of a bullying complaint he had made when a mediator was brought in to try and resolve the issue.  The complainant stated that he had been happy to stay in this area but had moved when this was suggested to him by the mediator.

The complainant stated that after the issue of the bullying complaint, management’s attitude to him had changed and they were constantly checking his work.  The complainant denied his rate of pay had reduced when moved from the area where TB was working.

The complainant also stated that he had not received any communications from the respondent in the week 10 to 17 May when he was out sick, that he had only received an email about being made redundant about a week before he was let go. He stated that he had never been given an opportunity to discuss alternatives to redundancy. He stated that he only discussed the situation with his SIPTU representative after he had come back to work from sick leave.

The complainant stated that he had been paid €12,000 as a redundancy lump sum and had been paid two weeks’ notice payment.

A shop steward also gave direct evidence at the hearing.  In his evidence the shop steward stated that he could only recall one mandatory redundancy in his 18 years with the respondent company, any other redundancies were voluntary.  His understanding of the redundancy criteria was that it was based on Last In First Out (LIFO). 

The shop steward also stated that the workers are all trained to do all sorts of jobs, that workers can be moved around to different areas and that this happens, “all the time”. Regarding consultation on the redundancies the shop steward stated that he had not been interactions between himself and management regarding the redundancies, management had gone straight to the SIPTU representative.

In conclusion, the complainant submits that he believes this was in fact a dismissal disguised as a redundancy. It is his belief that the civil action and related problems were influential in the respondent’s decision to make him redundant. Additionally, the selection process was highly flawed and there was inadequate consultation and discussion on alternatives. The complainant believes that he should be compensated for the loses caused by his redundancy.

I have carefully considered the evidence adduced during the hearing of this matter.

The complainant asserts that he was unfairly dismissed. The respondent asserts that the termination of employment was due to redundancy as the job was no longer viable in due to the downturn in the automotive industry as a result of the pandemic.

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.

Sec 7(2) The Redundancy Payments Act1967 highlights a number of various where redundancy arises as follows:

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.

I refer to Quinn (Jnr)-v-Quinn Insurances Limited UD2415/2011 in which the EAT noted for a redundancy defence to succeed it must result from (as per Section 7 (2) of the Redundancy Payments Acts 1967, as amended) "reasons not related to the employee concerned". In this regard redundancy is impersonal and where impersonality runs through the five definitions of Redundancy as set out at Section 7 (2) of the Redundancy Payments Act 1967, and as referred to above.

 I am also conscious of the decision in JVC Europe Ltd v Panisi [2011] IEHC 279, in which Charleton J warned at paragraph 5 of his judgment: “In an unfair dismissal claim, where the answer is asserting to be redundancy, the employer bears the burden of establishing redundancy and of showing which kind of redundancy is apposite. Without that requirement, vagueness would replace the precision necessary to ensure the upholding of employee rights. Redundancy is impersonal. It must result from, as Section 7(2) of the Redundancy Payments Act 1967, as amended, provides, ‘reasons not related to the employee concerned.

‘Redundancy, cannot, therefore, be used as a cloak for the weeding out of those employees who are regarded as less competent than others or who appear to have health or age-related issues. If that is the reason for letting an employee go, then it is not a redundancy but a dismissal”

The first issue that has to be addressed 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. The respondent must then justify that the process whereby the complainant was selected for redundancy, was fair and transparent in all respects. 

 I found the submission, including the supporting documents relating to the surplus work hours and evidence of the respondent on why the complainant’s role was being made redundant to be credible. Despite a number of initiatives being undertaken to avoid redundancies these were not sufficient to prevent a decision that redundancies would have to be made. It is widely understood that the global pandemic had a detrimental impact on the sale of road vehicles which cascaded down to all manufacturers supplying the automotive industry. The fact that his role was non-core meant that it was one of three jobs liable to redundancy. The redundancy of two other workers at the same time adds legitimacy to the situation as outlined by the respondent.

Having considered all the evidence presented, I find the respondent has provided sufficient evidence to prove that a redundancy situation existed and that redundancy was the main reason for the dismissal.

Regarding procedures, the respondent submitted that the procedure used to identify the workers to be made redundant was the clause incorporated in the Company/Union Agreement which states; “where practical, operate on a procedure based on service, all other things being equal”. According to the respondent, the second part of this clause, “all other things being equal”, gave the company latitude to defer from the “based on service” part of the clause in a situation where the complainant, although having longer service than TB, was in a non-core role and had been moved from a core role previously when he found that role to be beyond him, the role being undertaken successfully by TB.

Having considered this argument carefully I find the respondent was entitled to select the complainant for redundancy on the basis that although having longer service than TB the complainant was incapable of replacing him, thus all other things were not equal.

The complainant maintains that the reason he was selected for redundancy was because he had taken a civil action against the respondent previously with the redundancy now being used to cloak a vindictive dismissal.  In this matter I find the CEO’s evidence that the civil case did not enter his mind when the decisions on redundancy were being taken to be credible. I find there is no evidence to support the complainant’s assertion that his redundancy was because he had crossed the respondent in his previous civil case.

Regarding the onus of the employer to discuss/warn those who might be liable for redundancy of the situation and consult with them on alternatives I find the respondent did make efforts to contact the complainant by email and registered post but no real dialogue took place.  I found the complainant’s evidence in cross examination somewhat inconsistent in regard to the receipt of a registered letter. I accept the respondent was in contact with the complainant’s union representative as early as could be expected and kept the representative appraised of the situation. The complainant did accept that he had some prior knowledge of the impending redundancies.  I find the way this element of the redundancy was carried out was not done in the way it should have been, but fault lies on both sides. I do not find the faults in the consultation phase of the redundancy sufficient to be fatal to the respondent’s defence of the claim.

Having considered the totality of the evidence, I find that the complainant was dismissed by way of a legitimate redundancy, therefore, the claim under the Unfair Dismissals Acts fails.

The complainant was not unfairly dismissed.

Redundancy, dismissal, company / union agreement.