Worker

Employer

Representatives

Lousie Troy BL instructed by Daniel Walsh, Solicitor

Johanne Duignan, Solicitor,  Ledwith Solicitors LLP

Parties

A Financial Controller

A Meat Factory

Act

Complaint/Dispute Reference No.

Date of Receipt

Complaint seeking adjudication by the Workplace Relations Commission under the Industrial Relations Acts

CA-00046280-001

17/09/2021

The issue in contention concerns the alleged Unfair Dismissal of a Financial Controller by a Meat Processing Company.

The employment began on the 2nd June 2020 and ended on the 21st April 2021.

The rate of pay was stated to be € 1,292 per week for a 40-hour week.

As the Worker had less than 12 months service the case was taken under the Industrial Relations Act,1969

The Worker gave extensive Oral testimony supported by his Barrister, Ms. Troy. He presented as an experienced Financial Manager and gave direct forthright evidence.

The Worker was hired in June of 2020 as Financial Controller on a two-year fixed term contract. Although not professionally qualified he had a very extensive Financial management experience including service with many major Irish Public Companies. At the time of his interview and recruitment the Employer was represented to him as being Loss Making. Accordingly, he accepted a starting salary of € 42,000.

On appointment, he discovered that the Accounts were effectively in chaos and not in any way in keeping with modern Accountancy standards.  He immediately set about bringing in new systems in areas such as, ledger posting, reconciliations, Bank routines and VAT systems. This had an immediate positive effect, and the portrait of the employer as loss making was proven to be completely false. In fact, the Employer was quite profitable. Due to his efforts significant amounts of VAT were recovered from the Revenue.

In or about the 11th  March of 2021 he had a discussion, regarding his salary, with Mr. B Canning, the Employer retained, HR Consultant. He had sought, at least, an increase of 10% if not substantially more. The unfavourable comparisons of his rate of pay with that of his Finance predecessor and some operative/driving staff were referred to.

Mr. Canning, while not able to commit at the March meeting, agreed to have  discussions with the Directors and revert to the Worker. A further meeting took place of the morning of the 20th April which was also attended by Ms. L, the HR Manager. This meeting became contentious and the Worker, in support of his case quoted detailed and highly confidential Company financial figures including Director Renumeration packages. The Company was very profitable and could easily pay the Worker much more particularly in view of his major work in modernising the Accountancy function and bringing in up to date systems. Mr. Canning offered a salary increase of 5% with immediate effect but this had to be seen as derisory in the light of the profitability of the Company. The meeting concluded without any positive outcome.

Later that day at approximately 17:00 the complaint was summoned to a meeting with Mr. DS, the lead Director. He was informed that he had breached his Confidentiality Agreement and made very confidential figures widely available. The Worker was immediately suspended on full pay pending the holding of an Investigation scheduled for the 23rd April. The Worker was in a state of complete shock. He was not given any details of the “Confidentiality” Allegations and was left completely in the dark. The only conclusion he could come to was that the difficult meeting earlier in the day with Mr. Canning had been reported back to the Directors and that they had decided to get rid of him. He did not have 12 months service to qualify for the Unfair Dismissal Act,1977 so a cavalier approach could be taken.

In a state of shock, he had contacted his Solicitors, Coughlan White and Partners, who wrote on his behalf of the 22nd of April setting out detailed allegations and effectively making the case for a Constructive Dismissal. He has advised not to participate in the Investigation meeting scheduled for the 23rd  of April as it was alleged that it would be a “charade” to gloss over a Dismissal decision already made.

The principal Director, Mr.DS, contacted the Worker by e mail on the 26th April again requesting that the Worker attend an investigation meeting. This was followed by a further E mail of the 27th April effectively acknowledging that the Worker had “Resigned” and as and from the 27th April he was off the payroll.

The Worker strongly felt that he had been targeted by the Directors following the morning meeting of the 20th April 2022. He had simply pointed out the plain financial facts of the Company profitability and his major role in modernising the Financial functions. By any standards, comparability with other finance people in comparable industry for example, he was due a substantial salary review . This had annoyed the Directors, especially the details of their renumeration packages being shared before the HR Manger (who never had access to this level of information before) and Mr Canning.

The suspension of a Financial Controller for a “confidentiality issue” of this nature was completely unwarranted and totally unreasonable. His refusal to attend the Investigation meeting was taken on legal advice as it would simply have been lending credibility to a false process.

As compensation he was seeking the balance of his Salary for the unexpired period of his two-Year employment contract.

The Employer gave written evidence and supporting evidence from Mr. B Canning, a HR consultant who had been centrally involved.

The Worker had been hired on a Two-year Fixed Term Contract as a Financial Controller. His initial salary, € 42,000, had reflected the financial state of the Employer at the time. It was important to note that the need for absolute confidentiality had been emphasised at the start of the position. To this end he had signed not only the usual Contract of Employment with the normal Confidentiality cause but also a separate Personal Confidentiality agreement.

He performed excellently and made a major contribution to modernising the Finance Function.

In March 2021 he had requested via Mr C a salary increase. His aspirations were quite high, a revision into the mid € 56K + range per annum. Mr. C had consulted with the Directors and at a meeting on the morning of the 20th April an increase, with immediate effect of €5,000 was offered. The meeting of the 20th April was attended by Mr.C and Ms L, the HR Manager. The Worker had got quite annoyed at this offer and had quoted to Mr C and Ms L extensive and highly confidential Company financial information which was solely in his possession.

Neither Ms. L, the HR Manager, nor Mr. C would normally be authorised to have such information shared with them. Ms. L had immediately reported to the Directors, Mr DS and Mr. JS, who were taken severely aback at the breach of confidentiality. Mr. DS had arranged for a meeting that afternoon at approximately 17:15 with the Worker. Mr.DS, the Principal Director, had informed the Worker that he was being suspended on full pay while an Investigation into the breach of confidentiality could be arranged. It was scheduled for Friday the 23rd.

It was very important to note, the Employer stated emphatically, that the meeting regarding confidentiality, either at 17:15 on the 20th or the Investigation meeting on the 23rd April, had nothing to do with the salary issues from the Worker. They were completely unconnected issues.

The Worker had gone immediately to his Solicitors and a letter was received on the 22nd which effectively was a Constructive Dismissal claim. The Worker had in his Solicitor’s letter resigned. He had refused to attend any Investigation meetings either on the 23rd or later.

 Various efforts to get him to change his mind and come back to work & participate in the Investigation meeting had not succeeded. His employment was ended on the 27th by removing him from the Payroll. A subsequent approach from the Worker to allow him to change his mind was not possible to agree to as the relationship was beyond repair at this stage.

It was important to note that the Worker was never dismissed. He was simply requested to attend an Investigation meeting accompanied by a Legal representative, if he so wished. He had declined and in the Solicitor’s letter of the 22nd April had made numerous unfounded allegations against the Employer.

Mr. B Canning, HR Consultant, gave extensive Oral testimony corroborating the above reports. He had been part of recruiting the Worker and had felt that he had a good relationship with him. The Salary issue was discussed in March, on or about the 11th. . The discussion had been quite realistic. The Worker had accepted €42k at the time of recruitment. It may, on the face of things, have been quite low, but it was what the Employer could afford. The Worker was nearing retirement age and had been happy to accept it. Seeking a revised package in March, after some 9 months, was optimistic. The suggested figures of circa € 56/58 k would be hard to sell to the Directors. A revised offer of an additional €5,000 made on the 20th April was a good compromise in his opinion. He had been taken aback by the vehemence of the Worker on the 20th April and certainly was surprised by the Financial Details the Worker had revealed. Mr.C was a HR Consultant to the Employer and had never been privy to the very confidential details of the Employer finances. Ms. L the HR Manager had never been privy to this level of financial detail. It was way “above her pay grade”. The meeting had ended in a quite contentious fashion.

In final summary the Employer stated their case as one where they had a genuine concern over a breach of confidentiality. They had taken proper steps to Investigate, without any preconceived decisions and the Worker had refused to participate in any procedures. His Solicitor’s letter of the 22nd April was tantamount to a Resignation. Appeals to the Worker by Director DS on the 26th  and 27th  April had been in vain. The Employer’s Solicitor had sent a detailed reply ( 4 pages)  to the Worker’s Solicitor on the 29th April in which all his allegations were refuted.

There was no case here for any allegations of an Unfair Dismissal, constructive or otherwise.

This case was taken seeking a Recommendation under the Industrial Relations Act,1969. The Worker had not got the qualifying 12-month service for an Unfair Dismissals Act,1977 claim.

The very considerable body of Law and case Law precedent developed by the 1977 Act is therefore of only persuasive effect but none the less worthy of note as guidance.

A Constructive Dismissal case, to succeed, has to have three Tests in favour of the Employee or Worker. These are

(1) Fundamental breach of Employment Contract (of a really bad nature) by either side,

(2) Unreasonable Behaviours (again of a very bad or “egregious” nature) by either side

(3) Non-Utilisation of Employment Procedures prior to a resignation unless it was absolutely justified.

In this case, from all written and Oral Testimony, it is safe to conclude that no breach of the Employment Contract or Unreasonable Behaviours of such a fundamentally bad nature or egregious nature took place as to justify a Worker complaint of Constructive Dismissal.

However, it is important note that the Worker, in his oral evidence, as much as implied that the entire scenario of the 17:15 meeting on the 22nd April was a “set up” and as such could easily qualify as “Unreasonable Behaviour” by the Employer. His evidence was strong and forthright and stood up to cross examination.

The only question rests on the Procedural issue. In plain English was it “stage manged”, as claimed or a genuine Investigation?

A key factor has to be the fact that the Employer invited the Worker to bring a Representative. At the meeting of the 22nd at 17:00 this was clarified verbally as allowing the possibility of a “Legal Representative”. This point was repeated in the written materials supplied to the Adjudication by the Employer.

The offer of a Legal representative or indeed an Independent Representative has to be seen as a major supporting factor in the Employer’s case. Even if the Investigation was going to “prejudged”, as was alleged by the Worker, a refusal to take part accompanied by a Representative, made the Worker’s position untenable.  Not participating closed off all further opportunities of Appeal proceedings and the possibility of returning to work.

To an objective outside observer the confidentiality breach to the HR Manger and Mr.C, the Consultant seemed a bit over played by the Employer. Neither party, being members of management and covered by their own confidentiality agreements were likely to spread any information widely. However, this aspect could not have been explored by the Worker’s Representative for example, as the investigation meeting never took place.

There was no doubt from the Oral Testimony that the Worker was a dedicated and conscientious employee who had performed excellent work for the Employer. It was clear from him that when he had stabilised and modernised the Accountancy/Finance function, in the process recovering significant Vat from the Revenue, he had realised that he was significantly underpaid. He had taken €42K in June 2020 as being the most that a “Loss making” Company could afford. The reverse turned out to be the case.

In conclusion and as the case is under the Industrial relations Acts as Adjudication Recommendation ahs to be made. This is set out below.

Constructive Dismissal, Industrial Relations Act, Non participation in procedures.