Complainant

Respondent

Parties

Arkadiusz  Grzyb

Lidl Ireland Gmbh

Representatives

Eamonn O'Hanrahan E.M. O'Hanrahan Solicitors

Killian O'Reilly Fieldfisher

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-00043662-001

19/04/2021

Complaint seeking adjudication by the Workplace Relations Commission under section 6 of the Payment of Wages Act, 1991

CA-00043662-002

19/04/2021

The Complainant worked with the Respondent from 28th June 2011 as a Store Assistant. He was promoted to Deputy Store Manager on 1st September 2014.

The Complainant has worked with the company for around ten years. He was the manager on duty when the incidents took place on 26th and 28th October 2020. The company found the Complainant guilty of gross misconduct for theft due to non-adherence to cash management procedures, write off management, and inventory control following an investigation.

The company has a “waste not” policy whereby foods at their best before date but which are still good to eat are discounted with a barcode, this applies to poultry and meat products. The company alleges the Complainant through his conduct manipulated the policies to dishonestly steal bakery goods on 26th and 28th October 2020. The Complainant continued to work for the company until the date of his dismissal on 15th March 2021. He has a clean disciplinary record.

The Complainant says he adapted a common practice operated in other stores of the Respondent and these are minor procedural infractions. He believed the “waste not” procedure could be applied to bakery goods that were written off. He closed the bakery and wrote off bakery goods at an earlier time than designated due the store being quiet, the goods were stale and to allow staff to finish up by 9.15pm on a bank holiday. The Complainant says this is a common practice in some of the stores he worked in. Every evening the bakery items are written off and disposed of, with fresh bakery goods baked each day. He applied the “waste not” procedure to the bakery goods and purchased them at 20 cent each. As there were no discount stickers available, he took a product with a price of 20 cent and used this for an equivalent price entry. There was no economic loss to the company and it resulted in a surplus as he paid for the bakery goods.

The Complainant was not invited to make any representations to mitigate the sanction. He only realised he was accused of theft after he saw the investigation report dated 15th February 2020.

The Complainant says the conduct of the employer was unreasonable it cannot be considered gross misconduct, and the employer did not give any regard to the reasonable excuse given. The Complainant’s representatives rely on the decision in P Heffernan v Dunnes Stores [2011] 22 ELR 202. The Adjudication Officer’s function is to decide whether the employer’s reaction and sanction came within the range of responses of a reasonable employer. The investigation into the Complainant’s conduct was adversarial and was a predetermined investigation. The Complainant was not informed he was accused of theft in the investigation but told he was accused of not complying with various procedures. He only became aware of this afterwards and relies on the decision in Panasov v Pottle Pig Farm UD175.  The Complainant also relies on the decisions in Vitalie Vet v Kilsaran Concrete, Kilsaran International Ltd [2016] ELR237 and the Employment Appeals Tribunal in Lennon v Bredin M160/1978 regarding the severity of the sanction and the failure of the employer to consider any alternatives. Where an employer has condoned a practice and decides to take a firm disciplinary line it must give adequate warning to employees of this change.

The Complainant was dismissed and not paid notice. He obtained other employment on 14th June 2021 but has an ongoing loss of income of €19,600 per year.

The Respondent is a retailer and operates approximately two hundred stores across Ireland. The Complainant was promoted to Deputy Store Manager on 1st September 2014. This is a position of significant trust. The Complainant was responsible for training staff in store management, cash handling, inventory control and management of write offs.

A cash audit in October 2020 uncovered two separate breaches of the cash management procedures. The Complainant was invited to view CCTV, and to an investigation meeting. He was advised of his right to bring a colleague and referred to the disciplinary policy and procedure.

The Investigation meeting took place on 9th December 2020. The Complainant admitted to a number of breaches of cash management and inventory control procedures. Other members of staff were interviewed. The investigator found the Complainant had a case to answer. A disciplinary hearing was held on 3rd March 2021. The Complainant explained the correct cash management and inventory control procedures. He acknowledged removing bakery items without having paid for them on two occasions. He admitted he knew the correct procedures and apologised for his behaviour.

The manager found the Complainant had breached cash management, write off and inventory control procedures, and concluded there had been a fundamental breakdown of trust. The Complainant was dismissed on 15th March 2021. The Complainant appealed and the decision was upheld on appeal.

Following the Supreme Court decision in Zalewski v An Adjudication Officer & Ors [2021] 5 ICLMD 17 on 9th July 2021, the parties were advised that the Adjudication Officer did not have the power to take evidence on oath. The parties requested the Adjudication Officer proceed with the hearing as the dismissal was not in dispute. Following the hearing, the parties made further written submissions which were received on 12th October 2021.

I heard and considered the written and oral submissions of the parties.

The Complainant who was a deputy store manager was dismissed for a “fundamental breach of trust” by the company on 15th March 2021. He was employed for ten years with the company, and for six of these years he was a deputy store manager.

Section 6 (1) of the Unfair Dismissals Acts 1977 as amended 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) (1) of the Acts provide that without prejudice to the generality of Section 6 (1), the dismissal of an employee shall be deemed for the purpose of the Act not to be an unfair dismissal if it results wholly or mainly from one of the following:

(a)    the capability, competence and qualifications of the employee for performing work of the kind that he was employed by the employer to do:

(b)    the conduct of the employee,

(c)     the redundancy of the employee, and

(d)    the employee being unable to work or to continue to work in the position which he held without contravention (by him or by his employer) of a duty or restriction imposed by or under statute or imposed or under any statute or instrument made under statute.

Section 6 (1) (6) of the Act provides in determining whether the dismissal of the employee was an unfair dismissal or not, it shall be for the employer to show that the dismissal resulted wholly or mainly from one or more of the matters specified in subsection (4) of this section or that there were other substantial grounds justifying the dismissal.

Section 6 (1) (7) of the Act provides without prejudice to the generality of subsection 1 of this section, in determining if a dismissal is an unfair dismissal regard may be had, if the Adjudication Officer as the case may be, considers it appropriate to do so-

(a)    to the reasonableness of the conduct, or otherwise (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 S14 (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.

The Complainant’s contract of employment provides that his “employment may be terminated without either notice or payment in lieu of notice in the case of gross misconduct” which includes “theft of merchandise or property which belongs to the company…”.

The Respondent has detailed written policies for management of sales and write off procedures. The Complainant was responsible for ensuring compliance with cash management and inventory procedures when acting manager. The procedures provide staff sales must be processed by another cashier at the checkout. The write off procedure applies to bakery goods and specifies the writing off and disposal procedure. The procedures provide discounts only apply to products bearing a 30% discount sticker and are not applied to products without a 30% discount sticker.

The procedures for the stores set out clearly the discounts allowed which are standard procedures across all stores. There is no reference in the procedures to discounts on bakery goods. Following a cash audit showing irregularities, the Complainant was shown CCTV and admitted breach of the procedures and writing off bakery goods early. He apologised. He said he heard about discounts on bakery being applied in other stores, but did not provide detail. Two other members of staff were interviewed in the investigation. The two members of staff were unclear the discount procedure should not be applied to bakery goods.

The procedures provide the bakery goods be disposed of at close of business each day as fresh bakery goods are baked daily. On the two occasions when the Complainant applied a discount to bakery goods, this took place twenty-five minutes before close of business. The Complainant paid twenty cent on two occasions for goods, which at full price were €7.20. The bakery goods had a low value by the end of the day.

The Complainant was dismissed for fundamental breach of trust. The Respondent says the Complainant was responsible for training staff and if retained in the store would be in a position to access the till. However, there was little consideration of the Complainant’s explanation for breach of the procedures, evidence from other witnesses of lack of clarity in the discounting practice, the Complainant’s good service and low value of the bakery goods involved. The Manager who made the decision to dismiss, did not consider any alternative to dismissal although there were other sanctions available.

I am cognisant of the view of the Employment Appeals Tribunal in Patricia Heffernan v Dunnes Stores [2011] 22 ELR 202 where a staff member was dismissed for taking customers value club card points and said “the Respondent are entitled to stop this practice but the Tribunal cannot find that a dismissal for gross misconduct is an appropriate and proportionate response in all the circumstances”.

In all the circumstances, I find the sanction of dismissal does not come within the band of reasonable responses and is disproportionate. I find the Complainant was unfairly dismissed on substantive grounds. The appropriate redress is compensation. The Complainant has undoubtedly contributed to his dismissal.

The Complainant had over nine years’ service when he was dismissed and was entitled to four weeks paid notice pursuant to S4 of the Minimum Notice and Terms of Employment Act 1973. As the Complainant has been unfairly dismissed, his complaint of breach of Section 6 of the Payment of Wages Act 1991 is well founded, and I direct payment of four weeks’ notice of €3,615.40 to the Complainant by the Respondent.

The Complainant was out of work for ten weeks. He has mitigated his loss but has ongoing financial loss of €288.46 per week, a total of €23,461.50. His award of financial loss is reduced to €17,596.12 in view of his contribution to his dismissal, and I direct payment of this sum by the Respondent to the Complainant.

The complaint of breach of Section 6 of the Payment of Wages Act 1991 is well founded, and I direct payment of four weeks’ notice of €3,615.40 to the Complainant by the Respondent.

The Complainant was unfairly dismissed, and I direct payment of €17,596.12 financial loss by the Respondent to the Complainant.

Proportionality of sanction, reasonableness, disciplinary process