Complainant

Respondent

Parties

Brendan Phelan

Irish School of Motoring

Representatives

Keans Solicitors

HR Brief

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-00044547-001

10/06/2021

The complainant worked as Fleet Training Manager. He was dismissed on the 26th May 2021. His employment commenced on the 9th October 2006. He was paid €720 per week. The respondent denies the claim and asserts that the dismissal was not unfair on grounds of redundancy.

At the hearing, the respondent outlined that the complainant was the Fleet Training Manager and oversaw the administration of fleet training. The complainant was not himself a trainer. The training was given to employees who were provided company cars by their employer. The respondent outlined that fleet training reduced by 82% because of the pandemic and the complainant’s role had virtually ceased to exist. The complainant was laid off on the 16th March 2020 and returned on the 6th July 2020. He was laid off again in October 2020 and continued on lay off until the dismissal.

The respondent submitted that the fleet training business was no longer viable, and the complainant had not and would not be replaced. It outlined that three senior managers would now manage the trainers. There was a prospect of a State contract which would have been the complainant’s full time role but this has not materialised and has been postponed indefinitely.

The respondent outlined that there had been a consultation meeting on the 14th September 2020 where they discussed that the Fleet Training Manager role no longer existed and discussed alternatives. They also discussed retraining. Two other employees were made redundant, and all staff had been on lay off since April 2020. The only available role was in telesales, which the complainant did not accept.

The respondent outlined that fleet training required in-car training to employees, but this was not possible during the pandemic and no longer a priority because employees were working from home and conducting meetings remotely. The respondent stated that recovery in this business had been very slow. The respondent stated that the absence of fleet training meant that there was no need for a manager of the scheme. The respondent had looked at other options, but the complainant was not a trainer. There was no alternative role available especially as the State contract did not materialise.

In reply to the complainant, the respondent outlined that the Certificate of Professional Competence ‘CPC’ role was only 10% of the complainant’s role. They would not hesitate to have the complainant back and this was only their second redundancy in 60 years. They had no choice but to make the complainant redundant because of the pandemic. The respondent had obtained the State contract in February 2020, but this was postponed indefinitely. The respondent had been waiting for the State contract to come in after the September 2020 meeting. The complainant was then on PUP and on lay off, so there was no further consultation. The final payment to the complainant was made in August 2021.

The respondent submitted that this was a genuine redundancy, with an 82% drop in fleet training and people pivoting away from driving. The respondent had met the impersonality requirement as it was the role of fleet training manager that was redundant. Consultation had taken place in September 2020. The respondent submitted that the complainant’s role was no longer viable, in particular as the State contract did not materialise.

The complainant outlined that he worked for the respondent for 15 years and was the Fleet Training Manager. He did CPC training and fleet training as well as online bookings. He met two managers on the 14th September 2020 to discuss a possible redundancy and they said that they were struggling to find a role for him. He was later informed that the redundancy was not necessary, and they would send him alternative roles. In advance of the May 2021 meeting, the complainant had been expecting to go back to work.

The complainant outlined that there had been no correspondence from the respondent between September 2020 and May 2021. He was not informed of the subject matter of the meeting of the 19th May 2021 and assumed that he was returning to work. The meeting was with the same two managers as the September 2020 meeting. The complainant said that he was immediately told that they were there to talk about his redundancy. They offered him the statutory figure. The complainant told them that it was a pity that they could not find an alternative role for him in the company. There had been no discussion at the meeting of any alternative role. The complainant said that the Training Manager had been employed for four years and that he could have done this job with training.

The complainant said that he had been devastated at the end of the meeting. Parts of his role were still ongoing. He was not offered retraining and the respondent did not put a new organigram of the company to him.

The complainant said that he immediately lost access to his email and his phone was cut off a week later. He said that it was humiliating as he had disappeared from the business he had built up over 15 years. He said that CPC training was now ‘out the door’ and the respondent had hired someone to do social media work. The complainant could have done this role and had done it before. The complainant said that he was told that the respondent no longer had managers and now just hired administrators.

The complainant outlined that he had sought other jobs but was not successful. He continued to apply for jobs and was also retraining. He was doing a two-year part-time course. He thought that the industry had been taken from him. He had signed up with a recruitment firm and was open to work in different industries.

The complainant agreed that there was now less in-car training but there was still CPC training. It was busy at this time of year because of a regulatory deadline. He said that CPC training had been about 40% of his previous role. He had managed bookings for mainly professional drivers

The complainant said that in September 2020, they had discussed the complainant being brought in to help with other roles. He was later sent a list of roles, but he did not have the list to hand.

In cross examination, the complainant said that he had a good relationship with the respondent prior to the pandemic. He did not think that he should be personally singled out by the effects of the pandemic. He had shown value and loyalty to the respondent over many years and had shown willingness to train and to take on new roles. There were other aspects to his training role including the CPC role which he had built up. He accepted that the pandemic had damaged the in-car fleet training role, but this was only part of his job. It was put to the complainant that he had been offered the telesales role in September 2020; the complainant replied that he was not sure that this was ever an offer and the manager had said that it was beneath the complainant. The complainant was told in September 2020 that there was no role for him, but later that there would not be a redundancy and he would work in other roles. Because redundancy had been pulled on the day it was mentioned, he did not think to suggest other roles he could do. He said that the CPC role was generally busy between May and September, so he expected the May 2021 meeting to be about his return to this role. He said that there was a discussion at the beginning of the September 2020 meeting about alternatives but at the end of the day the redundancy was withdrawn. There had been no discussion of him doing the Training Manager role or the online advertising role.

In reply to the respondent, the complainant said that while there was no malice in the respondent’s actions, there was a material breach of the employee’s rights. There was no consultative process and the complainant believed that his role was safe. There were colleagues with similar levels of seniority who were left untouched. There was no discussion or process or alternative or training offered at the May 2021 meeting and the complainant was immediately cut off. There was no documentation regarding the process, and this amounted to a serious breach.

CA-00044547-001

This is a complaint of unfair dismissal. The complainant asserts that his dismissal was unfair, a claim the respondent does not accept.

The complainant was dismissed by letter of the 21st May 2021, where the respondent stated that the complainant’s ‘position has ceased to exist due to the impact of Covid-19 on the company operations in our Finglas and Tallaght Training Centres.’ It stated that it was initiating a redundancy process and that he would be entitled to statutory redundancy. The respondent thanked the complainant for his input and contribution to the respondent and wished him all the best for his future career.

Statutory background

Section 6(1) of the Unfair Dismissals Act provides ‘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) provides grounds where a dismissal will not be unfair. It provides ‘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 one or more of the following: … the redundancy of the employee.’

Section 6(6) sets out the applicable burden of proof: ‘In determining for the purposes of this Act whether the dismissal of an 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.’

This is the applicable burden of proof in this case as the complainant has more than one year’s service and his employment was not otherwise excluded from the scope of the Unfair Dismissals Act by section 2.

Section 6(7) provides that regard may be had to the reasonableness or otherwise of the conduct of the employer and to compliance with the dismissal procedure required by section 14 of the Act or any relevant Code of Practice. There is no specific Code of Practice addressing the making of redundancies.

Application of the law to the facts

Like businesses and employers around the country, the respondent had to grapple with the impact of the Covid-19 pandemic and the related public health measures. This included placing people on lay-off, as occurred in this case. There were very significant Government interventions to support businesses, for example the wage subsidy schemes and PUP, to keep people in employment or on lay off pending the re-opening of their workplaces. Employees placed on lay-off could also not trigger their entitlement to a redundancy lump sum payment until September 2021.

In this case, the respondent decided to dismiss the complainant, a longstanding member of staff, in June 2021. The question is whether the respondent has discharged the presumption that the dismissal was unfair by being able to show that it was wholly or mainly on grounds of the redundancy of the complainant’s role. This encompasses an assessment of the reasonableness of the employer’s conduct.

I find that the respondent has not discharged the presumption that the dismissal was unfair, and I reach this finding for the following reasons. I appreciate that the respondent was grappling with the uncertainty brought about by the pandemic, and the easing and re-imposition of public health measures. The complainant went on lay-off in March 2020 and returned to work in the summer of that year. There was discussion in September 2020 about the complainant’s possible redundancy and an alternative role which was deemed not to be appropriate. The respondent did not then implement the redundancy and the complainant went on lay-off again in October 2020.

The matter resumes in May 2021 when the complainant was asked to meet two senior managers and where he was informed that he was to be made redundant. There was no discussion of alternatives or any process involving the complainant. He was presented with a fait accompli.

The parties differed over the percentage CPC training made up of the complainant’s role, with the complainant saying that it was 40%, while the respondent stated that it was 10%. Even if the respondent’s figure is more correct, the respondent has not dislodged the presumption of unfairness. It is not, therefore, necessary for me to resolve this conflict in evidence.

The complainant had an established track record in the respondent business. He managed colleagues and dealt with customers. Even if one side of his role was badly affected by the pandemic, the complainant had other strings to his bow. His skills were transferable and could have been availed of in another role, either in May 2021 or at some later point in time. These were extraordinary circumstances during an unprecedented pandemic; the ‘reasonableness’ of a dismissal must be assessed in this light.

I accept that there was the meeting in September 2020 and discussion about an alternative role that was deemed unsuitable. This, however, was not the process that led to the decision to dismiss the complainant; this was made months later in May 2021. The outcome of the September 2020 process was not to dismiss the complainant, so how could it justify the decision to dismiss the complainant six months later.

The decision to dismiss the complainant in May 2021 without any process involving the complainant amounts to an unfair dismissal, in circumstances where the complainant had transferable skills and an established track record. There should have been a process involving the complainant and to which he could contribute to. Without this process, the respondent cannot say the dismissal was not unfair wholly or mainly on grounds of redundancy.

Redress / financial loss

The complainant selected the ‘compensation’ option in the complaint form.

I note that the definition of ‘financial loss’ in section 7 provides: ‘… 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 1973, or in relation to superannuation.’

The complainant was paid his redundancy lump sum entitlement, so is therefore not entitled to redress for any loss or diminution of a right arising from the Redundancy Payments Act. He is, however, entitled to compensation for any actual loss or any estimated prospective loss.

It is important to note that actual loss, prospective loss and a redundancy entitlement are separate and distinct. Actual and prospective loss is calculated according to loss arising after the (unfair) dismissal. The third category relates to an entirely separate head of loss, that of a lump sum entitlement from accrued service.

There is no legal basis for deducting the value of a redundancy lump sum paid to an unfairly dismissed employee in the calculation of actual or prospective loss. Section 19 of the Unfair Dismissals Act provides that the redundancy lump sum should be repaid where the employee is reinstated or re-engaged, but there is no equivalent provision where compensation is awarded.

Where a dismissal is held to be unfair and the employee was paid their redundancy lump sum entitlement, actual and prospective loss should still be assessed. This is not double compensation, as the lump sum entitlement is an entirely separate head of loss.

Of course, an award of redress must be just and equitable, and take account of the conduct of the employee and employer. This is provided for in section 7(1) ‘just and equitable compensation’. Section 7(2) sets out six particular aspects to have regard to, for example ‘employee conduct’ ‘employer conduct’ etc.

The fact of a redundancy lump sum being already paid is not listed in section 7 as a ground to reduce an award of compensation for actual or prospective loss. In fact, the definition of ‘financial loss’ suggests the opposite to be true. A practice of deducting a lump sum already paid from actual and prospective loss awarded as redress for unfair dismissal erodes the protections offered by the Unfair Dismissals Acts, especially for longstanding employees.

For clarity, this applies to all unfair dismissals where compensation is to be awarded, and not just those where the employer had sought to make the employee redundant. It applies in circumstances where no reason is given for the dismissal, or where the employer dismissed the employee on grounds of conduct, capability etc but was unable to show that the dismissal was not unfair. It arises from the definition of ‘financial loss’ in section 7 and is not related to the grounds for the dismissal, addressed in section 6. 

In assessing financial loss in this case, I note that the complainant has sought new employment via recruitment agencies and sought to upskill through study. The complainant’s weekly wage was €720. In the circumstances, I find that an award of €28,000 is just and equitable. This equates to about nine months financial loss and is a reasonable period to expect someone in the complainant’s circumstances and during a pandemic to find new employment. This is an award for actual and prospective loss and is in addition to the lump sum already paid.

CA-00044547-001

I decide that the complainant was unfairly dismissed, and the respondent shall pay to the complainant compensation of €28,000.

Unfair Dismissal Act / redundancy / consultation process / financial loss