ADJUDICATION OFFICER DECISION

Adjudication Reference:  ADJ-00028764

Parties:

Complaint:

Date of Adjudication Hearing:  08/09/2022

Workplace Relations Commission Adjudication Officer:  Aideen Collard

Procedure:

This complaint pursuant to Section 8 of the Unfair Dismissals Acts 1977-2015 was referred to the Workplace Relations Commission (hereinafter ‘WRC’) on 23rd June 2020.  Following delegation to me by the Director, I inquired into this complaint and gave the Parties an opportunity to be heard and to present any relevant evidence.  I heard this complaint in Lansdowne House on 8th September 2022. 

The Complainant was represented by Greg Ryan Solicitors and the Respondent was represented by Warren Parkes Solicitors.  The Operations Manager and a Director attended on behalf of the Respondent.  This hearing was held in public pursuant to Section 8(6) of the Unfair Dismissals Act 1977, as substituted by the Workplace Relations (Miscellaneous Provisions) Act 2021.  The Parties were made aware that their names would be published within this decision.  No written legal / factual submissions was received from either of the Parties in advance of or at the hearing. 

At the hearing, the Respondent raised a preliminary issue in relation to the jurisdiction of the WRC to hear this complaint.  This was whether the Complainant’s employment had terminated upon reaching “the normal retiring age for employees of the same employer in similar employment”, within the meaning of Section 2(1)(b) of the Unfair Dismissals Act 1977, being one of the express exclusions for pursuit of a complaint of unfair dismissal under the Act.  It was contended that the Complainant’s employment had lawfully terminated upon reaching his retirement age of 66.  Notwithstanding the lateness of this objection, this Adjudication Officer entertained same, accepted the paperwork at the hearing and also sourced the caselaw being relied upon by the Respondent.

As the determination of this preliminary issue would also determine the substantive issue of whether or not the Complainant was unfairly dismissed, evidence from both Parties was heard in full under oath.  All of the evidence, documentation and oral submissions have been fully considered.

Background:

The Complainant was employed by the Respondent as a mechanic from 1st January 2014 until the Respondent terminated his employment on 2nd April 2020.  He contended that he had been unfairly dismissed on the ground of age whilst the Respondent maintained that his employment had been lawfully terminated upon reaching his contractual retirement age of 66.  The Complainant earned €946 gross per week and sought compensation.  The Respondent sought to have this complaint of unfair dismissal dismissed on the basis that the Complainant was excluded from pursuing same under Section 2(1)(b) of the Unfair Dismissals Act 1977, as he had reached “thenormal retiring age”.

Preliminary Issue - Summary of Respondent’s Case:

The Complainant’s Solicitor had referred parallel complaints to the WRC on 23rd June 2020, comprising of a complaint of discriminatory dismissal under Section 77 of the Employment Equality Act 1988 and a complaint of unfair dismissal under the Unfair Dismissals Act 1977.  Section 101(4)(a) of the Employment Equality Act 1998 provides that in such circumstances, the complaint under the Employment Equality Act 1998 will be deemed to have been withdrawn unless, not later than 41 days from the date of notice, the Complainant withdraws the complaint under the Unfair Dismissals Act 1977.  His Solicitor was advised of this position by letter from the WRC dated 24th October 2020. 

Upon receiving no response, by letter dated 21st June 2022, the WRC confirmed that the complaint of dismissal under the Employment Equality Act 1998 was deemed to have been withdrawn and that arrangements would be made to process the complaint under the Unfair Dismissals Act 1977.  The Complainant’s Solicitor confirmed that he had been in receipt of that correspondence, that the discriminatory dismissal under Section 77 of the Employment Equality Act 1988 had been withdrawn and that a complaint of unfair dismissal under the Unfair Dismissals Act 1977 was being pursued.

The Complainant was employed by the Respondent as a mechanic from 1st January 2014 until 2nd April 2020 and at the time of the termination of his employment, he earned €946 gross per week.

On behalf of the Complainant, the specific details section of the complaint form provided: “I was born (on X day of) January 1954 and told I was being let go because of my age.  Mr employer had no complaint about my ability to carry out my duties and I was dismissed solely because of my age.”

The Respondent contended that the Complainant’s employment had been lawfully terminated following his 66th birthday as he had reached his contractual retirement age which was 66. 

It was further submitted that as 66 was the “the normal retiring age” for employees of the Respondent in similar employment, the Complainant was excluded from pursuing a complaint of unfair dismissal under Section 2(1)(b) of the Unfair Dismissals Act 1977.  This provides for the exclusions from referring a complaint under the Act including: “an employee who is dismissed and who, on or before the date of his dismissal, had reached the normal retiring age for employees of the same employer in similar employment or who on that date had not attained the age of 16 years,”

The Complainant maintained that he was unaware of any contractual retirement age or “the normal retiring age” for employees in similar employment and had been unfairly dismissed owing to his age.

The following evidence was adduced on behalf of the Parties in support of their respective positions:

Evidence of the Operations Manager for the Respondent, Mr A

Mr A, the Operations Manager for the Respondent gave evidence under oath in relation to the Complainant’s contract of employment as a mechanic.  He confirmed that the Respondent is a logistics and transport business, storing and delivering dry goods and currently has 42 employees.  Mr A also confirmed that the Complainant was initially employed by another company called JJN Transport Ltd, operated under the same management and taken over by the Respondent in 2014.  A Statement of Main Terms of Employment and Handbook was produced for both Companies. 

Mr A confirmed that the Statement of Main Terms of Employment for the Respondent contained the Complainant’s name, job title of ‘mechanic’, date of commencement of 17th January 2014 and remuneration of €920 per week inserted in handwriting.  It also contained a signature on behalf of the Employer which was dated 20th January 2014 but the space for a signature and date under the heading: “I acknowledge receipt of this statement.” was blank.  Under the heading ‘Retirement Age’, it stated: “The normal retirement age is 65.”  The Handbook was unsigned and also included a retirement clause which was read out and relied upon at the hearing providing: “The normal age for retirement is 66, and it is our policy for employees to retire at the end of the week in which their 66th birthday falls.  In certain circumstances consideration may be given to fresh employment being offered to you after retirement.  Such offers will be totally at the discretion of the Director.”  Mr A further confirmed that the Statement of Main Terms of Employment and Handbook were collated and handed to all employees including the Complainant with a copy retained in the office.  These were accompanied by a note: “Please read and sign employment contract.  Must be returned to office immediately when signed.  Original contracts will be kept on file.  You may request a copy for your own records.”  The employees were asked to take the documents away to read and return a signed copy and all but two employees including the Complainant never returned a signed copy. 

Mr A confirmed that a similar situation had prevailed in relation to the Statement of Main Terms of Employment and Handbook for the former Company.  The wording in the documentation was identical save than it contained the name ‘JJN Transport Ltd’.  The Statement of Main Terms of Employment for JJN Transport Ltd also contained the Complainant’s name, job title of ‘mechanic’, date of commencement of 11th January 2002 and remuneration of €750 per week inserted in handwriting.  Under the heading ‘Retirement Age’, it stated: “The normal retirement age is 65.”  It also contained a signature on behalf of the Employer which was dated 14th January 2002 but the space for a signature and date under the heading: “I acknowledge receipt of this statement.” was blank.  Mr A confirmed that the signature was his in his capacity as a Director.  This document would have been furnished to the Complainant but he had never returned a signed copy.  The Handbook (with an issue date of October 2008) contained the same retirement clause being: “The normal age for retirement is 66, and it is our policy for employees to retire at the end of the week in which their 66th birthday falls.  In certain circumstances consideration may be given to fresh employment being offered to you after retirement.  Such offers will be totally at the discretion of the Director.”

In relation to giving the Complainant notice of his impending retirement, Mr A said that he had spoken to him about it on three occasions beforehand.  Prior to Christmas 2019, Mr A had pointed out to the Complainant that he was coming up to the age of 66 and he did not respond at that stage but when they spoke again in January 2020, he said that he did not want to leave.  Mr A left it run whilst the Complainant took his holidays and Mr A also had to take time off owing to a serious personal matter.  Having turned 66 in January 2020, Mr A approached the Complainant again in March 2020 and told him that: “this has to happen, 66 isthe age that you are retiring.”  Mr A said that his employment could not have been extended as the technology had changed and the work that he could undertake had totally reduced.  Since 2015, most of the Respondent’s trailers were hired, mechanical issues were diagnosed electronically and maintenance was contracted out.  The Complainant’s job was essentially redundant since 2015 but he was kept on until his retirement as he was a long-standing employee.  They still had work for him “changing bulbs and bits and pieces”.  Documentation confirming the contracting out of mechanical maintenance was also furnished.

Mr A confirmed that nothing was put in writing to the Complainant confirming that his employment was being terminated upon reaching his retirement age.  The Complainant had taken his outstanding holidays, a date for the termination was fixed for 2nd April 2020 and he was given his last payslip for March 2020.  There was no severance or goodwill payment or agreement and the Complainant was not a member of any Company Pension Scheme.  Mr A confirmed that at the time of his termination during the start of the Covid-19 pandemic, as a transport company, the Respondent was very busy.  The Complainant had indicated that he wanted to stay on, but Mr A had no role for him and had offered to provide references to assist him with finding further work.  In terms of custom and practice, Mr A confirmed that no other full-time employees had yet reached the age of retirement.

Under cross-examination, Mr A was asked about the circumstances in which the Complainant was given the Statement of Main Terms of Employment and Handbooks which he denied ever receiving.  It was put to Mr A that the Complainant had literacy difficulties.  Mr A said he was not aware of a particular problem but agreed that “everything was verbal” and he would have used drawings to undertake his work.  It was also put to Mr A that the Complainant had been unable to take up work with a new employer owing to a loss of confidence arising from the termination of this employment.

Evidence of a Director of the Respondent, Mr B

A current Director of the Respondent confirmed under oath that the signature on behalf of the Respondent on the Statement of Main Terms of Employment dated 20th January 2014 was his.

Legal Submissions

In support of its preliminary objection, the Respondent relied heavily upon the decision of the Employment Appeal Tribunal (EAT) in Molloy -v- Connaught Gold UD891/2009.  The same issue had arisen in respect of a complaint of unfair dismissal where the claimant’s employment had been terminated upon reaching her 65th birthday.  The employer admitted the dismissal of the claimant but relied upon Section 2(1)(b) of the Unfair Dismissal Acts 1977, providing that an employee who on or before the date of dismissal has reached the normal retiring age for employees of the same employer in similar employment, is excluded from claiming under the Act as set out above.  

It was common case that there was no reference to a retiring age in any employment contract relating to the claimant.  The only written reference to retirement was in the terms of the Company Pension Scheme which referred to a normal pension age of 65, with a proviso for the employer to continue an employee in employment after that date “in exceptional circumstances”.  Although the vast majority of employees had retired at the age of 65, a number of employees had worked on after they turned 65, although the respondent had contended that these were in limited circumstances.

In finding for the respondent on this preliminary issue, the EAT held as follows: “Despite the decision in Kiernan -v- Iarnrod Eireann (UD974/94), the Act does not require the normal retiring age to be shown by way of a written contract, or other written notification and therefore the evidence must be examined to see whether a normal retiring age has been established.  As the claimant commenced employment in 1984, the absence of a written contract while regrettable is not unusual for that time.  The claimant did not contend that she agreed or was offered some later or different retiring age when she took up employment, she states that no retiring age was ever mentioned or formed part of her contract.  What is important to decide is therefore what was the “normal retiring age” for “employees of the same employer in similar employment”.  The evidence of the respondent was that the vast majority of its employees retired at age sixty-five and there were only a handful of exceptions.  The pension scheme which applied to the other employees of the respondent had a normal pension age of sixty-five apart from “exceptional circumstances”, where the respondent at its discretion could opt to continue the employee in employment past that age.  The Manager of the division of the respondent where the claimant was employed gave evidence that no employee working in that division had remained in employment beyond the age of sixty-five.  Two employees had requested that they remain in employment beyond the age of sixty-five but their requests were not granted and they retired on their 65th birthdays.  While the claimant gave some examples of employees of the respondent who had in the past continued after age sixty-five, the Tribunal accepts that these were unusual and the normal practise was retirement at age sixty-five.  Taking all these factors into account, the Tribunal finds that the normal retiring age for employees of the same employer in similar employment is sixty-five, and that as she had reached normal retiring age, on or before the date of her dismissal, that pursuant to Section 2(1)(b) of the Act theclaimant is not a person to whom the Act applies, and her claim against the respondent is hereby dismissed.”

Summary of the Complainant’s Case:

The Complainant gave evidence under oath confirming that he was initially employed by JJN Transport Ltd in 2002 as a mechanic fixing lorries until he was made redundant and he commenced work for the Respondent in the same role under the same management on 1st January 2014.  He did not recall ever seeing any written contracts of employment or paperwork whatsoever or of ever receiving the two Statements of Main Terms of Employment and Handbooks produced at the hearing.  He was unaware that the Respondent had a contractual retirement age of 66.  He recalled hearing people talking about staying on after retirement age but it was never discussed within the Company.  He was first informed about his impending retirement about three weeks beforehand.  A difference in opinion had arisen with Mr A about how a truck should be repaired where Mr A had told him: “You’ve your way of doing things and I have mine” before walking off.  Mr A later returned and said to him: “You’re 66 in January, I won’t be able to insure you anymore, I’ll have to let you go.”  The Complainant had replied: “I don’t want to go, what would I be doing at home.”  He explained that he had lived for his job particularly after he was widowed in 2013.  It was common case that he had received his last payslip for March 2020 and his employment had been terminated on 2nd April 2020.  The Complainant had declined further employment so had not incurred any loss of earnings.

Under cross-examination, the Complainant maintained that he never received the Statement of Main Terms of Employment and Handbook for either Company nor did he recall ever seeing same.  He clarified that he had first heard about his own retirement from the Respondent when Mr A had informed him about his impending retirement.  It was put to him that he was now putting forward an alternative case that his dismissal was related to the incident with Mr A and not on the ground of age as per his complaint form.  The Complainant said that there had been a build-up as he did not have the means to undertake his job which had been reduced to what he could and could not do.  It was put to him that he was mistaken about being first informed of his retirement only three weeks beforehand because his employment had terminated in April 2020 and the conversation he recalls made reference to his 66th birthday which was in January 2020.  The Complainant said he would stand corrected but maintained that he was first told of his impending retirement close to its date.

The Complainant had instructed his Solicitor to refer a complaint to the WRC on his behalf on 23rd June 2020.  The specific details section of the complaint form provided: “I was born (on X day of) January 1954 and told I was being let go because of my age.  Mr employer had no complaint about my ability to carry out my duties and I was dismissed solely because of my age.”  The Respondent’s preliminary objection to the referral of this complaint was refuted on behalf of the Complainant.

Findings and Conclusions on Preliminary Issue:

It is necessary to firstly determine whether the Respondent has established that it had “thenormal retiring age” for employees in similar employment to the Complainant within the meaning of Section 2(1)(b) of the Unfair Dismissals Act 1977, and if so, whether his employment was lawfully terminated upon reaching that age thereby excluding him from pursuing this complaint of unfair dismissal.

• It is noted that Section 2(1)(b) of the Act does not expressly require an employee’s retirement age to be contained in their employment contract or written statement of terms of employment and nor is it a statutory requirement under the Terms of Employment (Information) Act 1994. However, inclusion of such a clause within an employment contract may evidence an employer’s “normal retiring age” along with other evidence such as the date of maturity of an applicable company pension scheme, correspondence confirming same and custom and practice. 
• There is directly conflicting evidence as to whether or not the Complainant was ever furnished with a copy of either set of the Statement of Main Terms of Employment and Company Handbook. The Respondent maintains that the Complainant was furnished with this documentation whilst the Complainant does not recall receiving/seeing same.  It is quite possible that both positions are correct.  I do not propose making a finding of fact on this conflict because even if the Complainant was furnished with same, and thus had written notice of the retirement clauses therein, they are contradictory such that there could be no definitive retirement age.  The Respondent’s Statement of Main Terms of Employment provides for a retirement age of 65 whilst the Handbook provide for a retirement age of 66.  There is no clause in either of the Statement of Main Terms of Employment or the Handbook providing that one takes precedence.  Nor was there anything in writing to the Complainant clarifying the correct retirement age.  It is unclear as to why the Respondent has chosen to overlook the earlier age of 65 in the Statement of Main Terms of Employment when arguably that constitutes the contract of employment taking precedence over the Handbook.  Regardless, I find that a position of such uncertainty as to the Respondent’s retirement age arises from the documentation provided that it cannot be reliably relied upon to determine  “the normal retiring age” for the Complainant.
• Turning to whether the Respondent has established “the normal retiring age” for employees in similar employment to the Complainant by way of custom and practice, it is noted that the Respondent was unable to provide any examples of any other fulltime workers retiring at the age of 66, including any other employees undertaking similar work to the Complainant.
• The facts in this case are clearly distinguishable from those in Molloy -v- Connaught Gold UD891/2009 and a recent decision of the WRC in Fleming -v- Instant Upright Limited (ADJ-0033239), both of which found in favour of the employer on the same preliminary issue. Although there was no employment contract containing a retirement clause in Molloy -v- Connaught Gold, the employer had an established custom and practice whereby the vast majority of its employees retired at the age 65 and the pension scheme which applied had a normal pension age of 65 apart from “exceptional circumstances”, where the respondent at its discretion could opt to continue the employee in employment past that age.  InFleming -v- Instant Upright Limited (where arguably the employer had also opted to rely on a retirement clause instead of making the complainant redundant), the complainant’s employment contract had contained a clear and unambiguous clause providing for a retirement age of 65 and the retention of employees on a fixed-term contract beyond the age of 65 occurred exceptionally.
• In the absence of any unambiguous evidence of an established retirement age, I find that the Respondent has not shown “the normal retiring age” for employees of the Respondent “in similar employment”, and hence that WRC has jurisdiction to adjudicate upon this complaint.

Findings and Conclusions on Substantive Complaint:

I will turn to consider the substantive issue of whether the Complainant’s dismissal was unfair.  Noting that there are no issues as to the requisite service or time for referral of this complaint, it is firstly necessary to set out the remaining relevant statutory provisions.  Section 6(1) 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 defines the circumstances which do and do not constitute an unfair dismissal and specifically, Section 6(2) 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, to be an unfair dismissal if it results wholly or mainly from one or more of the following: (ee) the age of the employee,”  In relation to the burden/onus of proof, Section 6(6) provides: “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.”  Section 8 provides for the procedure for referral of a complaint of unfair dismissal to the WRC and determination of same by an Adjudication Officer. 

Applying the aforesaid provisions to the factual matrix herein, it is common case that the Respondent terminated the Complainant’s employment on 2nd April 2020 following his 66th birthday.  Section 6(2)(ee) of the Unfair Dismissals Act 1977 provides that dismissal on the ground of age is automatically unfair.  Termination of the Complainant’s employment following his 66th birthday also appears to have coincided with the fact that his role was essentially redundant.  Section 6(1) provides that the burden of proof rests with the Respondent to show that a dismissal was fair.  The Respondent has not identified any grounds under which the Complainant could have otherwise been fairly dismissed or adduced evidence of same.  It follows that the Complainant’s dismissal was unfair. 

Whilst some of the Complainant’s evidence is more akin to a complaint of discriminatory dismissal under Section 77 of the Employment Equality Act 1988, this entails different legal provisions and considerations, and therefore it is not necessary or appropriate to explore this evidence further in the context of a complaint of unfair dismissal.  It should however be noted that the establishment of a “normal retiring age” will not necessarily debar a complaint of discriminatory dismissal.

Decision:

Section 8 of the Unfair Dismissals Act 1977 (as amended) requires that I make a decision in relation to a claim of unfair dismissal, consisting of a grant of redress in accordance with Section 7 of the Act.  For the aforesaid reasons, I find that the Complainant was unfairly dismissed by the Respondent.  Section 7(1) sets out the various forms of available redress including reinstatement, re-engagement and financial compensation as deemed appropriate having regard to all the circumstances.  Section 7(1)(c)(i) provides for compensation of up to 104 weeks remuneration in respect of the employment from which an employee was dismissed for “financial loss” attributable to the dismissal.  Section 7(1)(c)(ii) provides for compensation of up to 4 weeks remuneration if no financial loss was incurred by an employee.  Section 7(2) sets out the various factors to be considered in terms of an employer’s and employee’s respective contribution to the dismissal and an employee’s mitigation of any financial loss.  Section 7(3) further provides that: ““financial loss”, in relation to the dismissal of an employee, includes 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;”. 

Although the Complainant did not suffer a loss of earnings having declined further employment, given that his role was essentially redundant on both Parties’ evidence, he suffered the loss of a potential statutory redundancy payment under the Redundancy Payments Acts 1967-1973.  Had the Complainant been properly allowed to continue on in his employment, this was an inevitability.  This is calculated from 1st January 2014 and 2nd April 2020 as the relevant dates and €946 as his weekly wage so his statutory redundancy would have amounted to €8,112.  There were no breaks in service and no contribution from the Complainant as to his dismissal.  He was a loyal employee with long-standing service.  In all of the circumstances, I find it just and equitable that the Complainant be compensated in full for the loss of his accrued service accordingly.  The Respondent is therefore directed to pay the Complainant €8,112 in compensation (a severance payment for tax purposes).

Dated:   27/04/2023

Workplace Relations Commission Adjudication Officer:  Aideen Collard

Key Words:  Unfair dismissal on the ground of age - Section 6(2)(ee) of the Unfair Dismissals Act 1977 – preliminary issue - whether employee had reached ‘normal retiring age’ under Section 2(1)(b) – statutory redundancy constitutes ‘financial loss’ under Section 7(3) the Unfair Dismissals Act 1977