RPD233

1.Appeal of Adjudication Officer Decision No(S) ADJ-00037042, CA-00048073-001

BACKGROUND:

2.The Worker appealed the Decision of the Adjudication Officer to the Labour Court on 19th December 2022 in accordance with the Redundancy Payments Acts 1967 to 2014. A Labour Court hearing took place on 23rd March 2023. The following is the Determination of the Court:

DETERMINATION:

This is an appeal by Mr Mark Smith (“the Complainant”) against an Adjudication Officer’s Decision ADJ-00037042 - CA-00048073-001) given under the Redundancy Payments Act 1967 (“the Act”) in a claim by him against his former employer Thornton Construction (“the Respondent”).

Mr Smith did not attend the hearing at first instance. The Adjudication Officer held that the claim was not well founded. A Labour Court hearing was held on 23 March 2023.

It is accepted that the Complainant was employed with the Respondent from 6 November 2006 until 30 July 2021.

Position of the Complainant

The Complainant’s employment terminated on 30 July 2021 when the Respondent company closed down. The Complainant commenced employment with another employer the following week and he understood that his employment service would follow through from his previous employment. When he approached his new employer about the matter, the employer refused. It is the Complainant’s case that he is entitled to a statutory redundancy payment arising from the termination of his employment with the Respondent.

Position of the Respondent

The Respondent accepts that the Complainant was employed from 6 November 2006 until 30 July 2021. The Respondent ceased trading as a sole trader after he became unwell and encountered economic difficulties. He arranged for the Complainant to get a job with another employer, as he could not afford to pay him redundancy and he thought this was the best that he could do for him.

The Law

Section 7 of the Redundancy Payment Act sets out a general right to a redundancy payment as follows.

• “7.—(1) An employee, if he is dismissed by his employer by reason of redundancy or is laid off or kept on short-time for the minimum period, shall, subject to this Act, be entitled to the payment of moneys which shall be known (and are in this Act referred to) as redundancy payment provided—
  (a) he has been employed for the requisite period, and
  (b) he was an employed contributor in employment which was insurable for all benefits under theSocial Welfare Acts, 1952to 1966, immediately before the date of the termination of his employment, or had ceased to be ordinarily employed in employment which was so insurable in the period of four years ending on that date.
  
  (2) For the purposes of subsection (1), an employee who is dismissed shall be taken to be dismissed by reason of redundancy if for one or more reasons not related to the employee concerned the dismissal is attributable wholly or mainly to—
  (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,
  
  (5) In this section requisite period means a period of 104 weeks continuous employment (within the meaning of Schedule 3) of the employee by the employer who dismissed him, laid him off or kept him on short time, but excluding any period of employment with that employer before the employee had attained the age of 16 years”.

• 9.— (3) (a) An employee shall not be taken for the purposes of this Part as having been dismissed by his employer if—
  (i) he is re-engaged by another employer (hereinafter referred to as the new employer) immediately on the termination of his previous employment,
  (ii) the re-engagement takes place with the agreement of the employee, the previous employer and the new employer,
  (iii) before the commencement of the period of employment with the new employer the employee receives a statement in writing on behalf of the previous employer and the new employer which—
  • (A) sets out the terms and conditions of the employee’s contract of employment with the new employer,
    (B) specifies that the employee’s period of service with the previous employer will, for the purposes of this Act, be regarded by the new employer as service with the new employer,
    (C) contains particulars of the service mentioned in clause (B), and
    (D) the employee notifies in writing the new employer that the employee accepts the statement required by this subparagraph.
  (b) Where in accordance with this subsection an employee is re-engaged by the new employer, the service of that employee with the previous employer shall for the purposes of this Act be deemed to be service with the new employer.
  
  

Deliberation

It is accepted by both parties that the Complainant’s employment with the Respondent commenced in 2006 and that his employment terminated in July 2021 when the Respondent company ceased trading due to financial difficulties.

The Redundancy Payments Acts at section 9 sets out certain circumstances where an employee shall not be taken to be dismissed by reason of redundancy. This can arise where an employee is engaged by another employer by agreement between the parties, and before the employee commences that employment he receives a statement in writing on behalf of the previous employer and the new employer setting out the terms and conditions of the employee’s contract of employment with the new employer. That statement must specify that the employee’s period of service with the previous employer will, for the purposes of this Act, be regarded by the new employer as service with the new employer.

In the within case no such agreement was entered into by the parties.In response to questions from the Court, the Respondent confirmed that nothing was set out in writing to the Complainant with regard to the termination of his employment or with regard to his service transferring to a new employer. The Respondent acknowledged that the Complainant started working with his new employer on a day one basis. In such circumstances the Court finds that section 9(3) of the Act does not apply to the circumstances that arose in the within case.

Accordingly, having regard to all of the circumstances, the Court finds that the Complainant’s employment was terminated by reason of redundancy when his former employer ceased to carry on the business for the purposes of which the employee was employed by him. As a result, the Complainant is entitled to a statutory redundancy payment in line with the Redundancy Payments Acts in respect of his service between 06 November 2006 and 30 July 2021.

It is agreed that the complainant’s rate of pay was €735 per week and that figure should be used when calculating the redundancy amount in accordance with Schedule 3 of the Redundancy Act 1967.

Determination

The Court determines that the compliant is well founded and that the Complainant is entitled to a statutory redundancy payment on the following basis:

Commencement date: 06 November 2006

Termination date: 30 July 2021

Gross weekly wage: €735.00

The Decision of the Adjudication Officer is set aside accordingly.

The Court so determines.

	Signed on behalf of the Labour Court
	Katie Connolly
NCL	______________________
5 April 2023	Deputy Chairman