Complainant

Respondent

Parties

Conor  Gilligan

RBCM Limited

Representatives

O’Gorman Solicitors

 No appearance

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-00049100-001

09/03/2022

The Complainant commenced employment with the Respondent on the 15/10/1990 and was appointed CEO in 2003. The Complainant was notified of his dismissal on the 14/2/2022 on a “no fault” basis in accordance with the terms of his contract. The Complainant received a monthly salary of €17,944.60.  

On the 9/3/2022, the Complainant referred a complaint to the WRC pursuant to the Unfair Dismissals Act 1977 as amended. 

No appearance was made, or evidence adduced at the hearing by or on behalf of the Respondent.

I am satisfied that the Respondent was notified of the date, time, and place of the hearing by way of the hearing letter dated 1/3/23 served by post. I note that since the complaint was first lodged the Respondent company has gone into voluntary liquidation. I further note that the appointed Liquidator was aware of the hearing date as confirmed in a letter dated 14/4/2023 from OCWM Law LLP who act on behalf of the appointed Liquidator and confirmed that they did not have instructions to appear at the hearing. No appearance was made by the appointed Liquidator.  

I am satisfied that the Respondent and or appointed Liquidator on behalf of the Respondent were properly notified of the date, time and place of the hearing and failed to attend. The Respondent has made no contact with the WRC since the hearing date.   I proceeded to hear the case in the absence of the Respondent.

There was no appearance by or behalf of the Respondent.

The hearing letter dated 1/3/23 was served on the Respondent company to the address as furnished by the Complainant by way of post notifying of the time date and place of the hearing.

The solicitor for the Complainant notified the WRC by way of email dated 2/11/2022 that the Respondent company had gone into voluntary liquidation since the complaint was first lodged.

At the hearing Counsel for the Complainant exhibited a letter dated 14/4/2023 from OCWM Law LLP who act on behalf of the Liquidator. It is stated in the letter that the Liquidator was aware of the hearing scheduled for the 18/4/23 and had not received any instructions to come on record and appear at the hearing.  

No evidence was adduced at the hearing by or on behalf of the Respondent or the appointed Liquidator.

At the hearing Counsel for the Complainant set out the following facts and legal arguments.

The Complainant submitted that he was unfairly dismissed by the Respondent on a “no fault” basis in accordance with the terms of his contract and was notified of his termination by way of email dated 14/2/22 with a letter attached providing him with 6 months’ notice. It is submitted that the date of dismissal for the purposes of this claim is the 14/2/2022. It is submitted that the Complainant earned a salary of €18,279.23 in total per month, to include basic pay, a pension contribution of €2750, monthly company car benefit in kind, €1,953 and health insurance contribution of €586.  

It is submitted that no reason was provided to justify the dismissal, the Complainant was informed that he was dismissed on a “no fault” basis.  Counsel submitted that the Complainant’s dismissal was both substantively and procedurally unfair and in breach of section 6 of the Unfair Dismissals Acts 1977 (the Act). It is further submitted that the Respondent made no attempt to justify the dismissal. It is further submitted that the Complainant was placed on garden leave however only one payment was made on the 10/3/2022, accordingly it is submitted that the garden leave was a “sham”.

Evidence of Complainant Mr Connor Gilligan

Mr Gilligan stated that he was employed by the Respondent on the 15/10/1990 in administration. The Complainant stated that he was appointed CEO of the Respondent in January 2003.

In terms of background, Mr Gilligan stated that in 2006 the Respondent company had a turnover of €385 million, and in 2010 the Respondent expanded the business into Poland. The Complainant stated in circa 2010, there was in total 1,700 people employed by the Respondent.

The Complainant stated that in September 2019, the Respondent, RBCM Limited was incorporated for the purposes of creating a vehicle to employ all Directors of Road Bridge Holdings Limited (RBH Ltd) the parent company. He stated that the Respondent, is under the control of the parent company as are other companies. He stated that his role didn't change as he remained as the CEO.  

Mr Gilligan stated that the owner and founder of the Respondent and parent company passed away in 2014. The Complainant stated that in 2019 more family members of the owner’s family were appointed to the Board of Directors of RBH Ltd, in a non-executive function.

Mr Gilligan provided further detail regarding the involvement of the family members in the running of the business. The Complainant stated that a named bank was the main funder by way of the provision of loans to the Respondent. Mr A on behalf of the named Bank was appointed a non-executive Director on the Board of Directors of RBH Ltd.  The Complainant stated that Mr A was appointed as the chair of the Board of Directors in RBH Ltd in November 2021.

The Complainant stated that in 2022 there was a turnover of €243 million, however there was an issue with cash flow. At that time the Complainant stated that the Respondent was in dispute with three different clients who owed the Respondent over €60 million between them in fees.

The Complainant stated that €4.5 million in expenses was provided from the Respondent to family members.  The Complainant stated that as CEO he took the position that the monies were owed by the family members to the Respondent and the matter should be dealt with through the chairman of the Board of Directors. He stated that the family members had a different view on the matter. The Complainant further stated that in early 2022 there was correspondence between himself and the chairman of the Board of Directors regarding how the matter of family expenses could be resolved. The Complainant stated that this was relevant as background regarding his dismissal.

The Complainant stated that he wanted to pursue the debts owed by clients to the Respondent however there was conflicting approaches between himself and the family members as to how the monies were to be recovered. The Complainant provided further detail in this regard.

The Complainant further clarified that he would prefer to say that he wanted a resolution of the expenses incurred by family members. He stated that this led him into conflict with various family members who were non-executive Directors on the Board.

The Complainant provided further detail regarding the appointment of a named consultancy company to advise on the best methods to recover outstanding debts owed by clients to the Respondent. The Complainant stated that the named consultancy company issued a draft report stating, in their view, that the Respondent company was insolvent.

The Complainant stated that he has completed a detailed report on all events that occurred which he has submitted to the Liquidator of RBH Ltd, and it will be sent to the Director of Corporate Enforcement. The Complainant provided further detail regarding a board meeting of RBH Ltd held on the 11/2/2022. 

The Complainant stated that he got a telephone call from the company secretary of the Board on the 11/2/2022, advising him that a meeting of the Board of Directors of the Respondent was being called for the 14/2/2022 the following Monday, to consider his dismissal. He then received an email circulated to all Directors of the Board which contained a resolution to consider the Complainant’s dismissal on a “no fault” basis.

The Complainant stated that he attended a meeting of the Board of Directors on the 14/2/2022, where a resolution was passed to terminate the Complainant’s contract on a “no fault” basis. The Complainant stated that he was asked to leave the meeting while the Directors voted on a resolution to dismiss him which was passed by a majority of seven votes to four. He was advised that he had lost the vote, and he did not return to the meeting.

The Complainant stated in evidence that no complaints were made against him, no charges or complaints were ever put to him. The Complainant stated that he received an e-mail from Mr A,   a Director on behalf of the Respondent, with a letter attached (exhibited at the hearing) providing  him with six months’ notice of termination in accordance with clause 9.3 of his contract, and that he was being placed on garden leave for the duration of the notice period. The Complainant confirmed that he never worked again with the Respondent.

The Complainant confirmed that he was not advised by the Respondent of a right to appeal the decision terminating his contract. The Complainant stated that there was an employee handbook in place, however it was not applied to his dismissal.  He stated that the garden leave was not genuine and that the Respondent had no intention of honouring it. The Complainant stated that he received one payment on the 10/3/2022 in the amount of €12,357.12 he was not provided with a pay slip or any documentation and the money was lodged into his bank account. The Complainant confirmed that a month later his company car was removed when two men appeared at his house and took the car. It was agreed that he could keep his laptop and phone.

The Complainant stated that RBH Ltd went into receivership on the 14/3/2022, and the Respondent went into liquidation on the 21/6/2022. He stated that he was notified that the Respondent has no funds but that there is an insurance policy under a named insurer, the Respondent’s group insurer, which covers employment situations. However, he was advised by the named insurer, that they would not indemnify his claim.

The Complainant stated that he was never provided with a reason for his dismissal either at the Board of Directors meeting or in any subsequent correspondence nor did any member of the Board of Directors contact him. The Complainant further stated he was employed by the Respondent for 32 years and that there was no justification for his dismissal. The Complainant stated that he was not advised of his right to representation prior to the meeting on the 11/2/2022. The Complainant confirmed that he did not receive a bonus payment or any ex-gratia payment.

Mitigation

The Complainant stated that he obtained alternative employment on the 11/7/ 2022 with a named construction company as CEO and is receiving a monthly salary of €9,845.35 and does not receive any benefits in kind. The Complainant stated that he had interviews with six other companies in the UK as he was heavily involved in projects with the Respondent in the UK.

He stated that he did not receive a final pay slip and was not paid for any accrued annual leave. The Complainant stated that there is no guarantee that he will be able to obtain employment with the level of earnings that he had with the Respondent.

Sum up

Counsel for the Complainant submitted that the date of dismissal for the purposes of this claim is the 14/2/22. He further submitted that the Respondent placed the Complainant on garden leave but in fact it was a fiction. It is submitted that he did get a payment of €12,577 on the 10/3/2022, but this does not alter the fact that the correct date of dismissal is the 14/2/2022. He stated that while the Complainant was on garden leave the Respondent company went into receivership. It is submitted that the Complainant is seeking compensation from the date of dismissal of the 14/2/2022 and that he has ongoing losses. It was further submitted that the Complainant is seeking a once off lump sum bonus payment payable to the Complainant under clause 5.2 of his contract of employment.

The Relevant Law

Section 6 of the Unfair Dismissals Act 1977 as amended (the Act) in the relevant part provides;

6.— (1) 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) expressly lists the grounds where dismissal of an employee shall not be deemed to be unfair, and Section 6(6) imposes the burden of proof on the employer to show that the dismissal was fair.

Section 6(7) sets out the requirement for an employer to act reasonably when carrying out a dismissal. Section 6(7) provides for an Adjudication Officer to have regard:-

 “(a) to the reasonableness or otherwise of the conduct (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 section 14 (1) of this Act (to provide written reasons when requested) 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.” 

Section 7 outlines the provision for a remedy in the circumstances of a successful claim for unfair dismissal. 

Section 7 (1) provides in the relevant part;

(1) Where an employee is dismissed and the dismissal is an unfair dismissal, the employee shall be entitled to redress consisting of whichever of the following the adjudication officer, considers appropriate having regard to all the circumstances:….

c)(i) if the employee incurred any financial loss attributable to the dismissal, payment to him by the employer of such compensation in respect of the loss (not exceeding in amount 104 weeks remuneration in respect of the employment from which he was dismissed calculated in accordance with regulations under section 17 of this Act) as is just and equitable having regard to all the circumstances, ……

(2) Without prejudice to the generality of subsection (1) of this section, in determining the amount of compensation payable under that subsection regard shall be had to—……….

(c) the measures (if any) adopted by the employee or, as the case may be, his failure to adopt measures, to mitigate the loss aforesaid

[(d) 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 subsection (1) of section 14 of this Act or with the provisions of any code of practice relating to procedures regarding dismissal approved of by the Minister,

(e) the extent (if any) of the compliance or failure to comply by the employer, in relation to the employee, with the said section 14, and

(f) the extent (if any) to which the conduct of the employee (whether by act or omission) contributed to the dismissal.

(3) In this section—

“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 [2014], or in relation to superannuation;

“remuneration” includes allowances in the nature of pay and benefits in lieu of or in addition to pay.

Regrettably, the Respondent did not attend the adjudication hearing to provide evidence in their defence, or to contradict the Complainant’s evidence.  

Section 6(6) imposes the burden of proof on the employer to show that the dismissal was both substantively and procedurally fair.

I note from the letter exhibited at the hearing by the Complainant, signed on behalf of the Director of the Respondent which states “Further to the meeting of the directors of RBCM Limited (the “Company”) which took place earlier today, the Company determined to terminate your employment with the company on a “no fault basis” in accordance with clause 9.3 of your contract of employment dated 4th October 2019”.  I further note that the Complainant was provided with six months’ notice in accordance with clause 9.3 of his contract. Further to clause 10.1 the Complainant was placed on garden leave for the duration of the notice period and was entitled to receive his basic salary and all contractual benefits. 

I accept the Complainant’s uncontested evidence that he attended a Board of Directors meeting on the 14/2/2022 where a resolution was passed by a majority of the Directors to terminate the Complainant’s contract on a “no fault basis”. I also accept the Complainant’s uncontested evidence that no complaints or charges/allegations were ever put to him by the Respondent nor was he provided with a reason justifying his dismissal.

It is also well established that an employee has a contractual, constitutional, and statutory entitlement to fair procedures. S.I. No. 146/2000 - Industrial Relations Act 1990 (Code of Practice on Grievance and Disciplinary Procedures) (Declaration) Order 2000, provides that employers should have written procedures for dealing with disciplinary issues reflecting the varying circumstances and outlines the principles of fair procedures for employers and employees generally.

I found the Complainant’s uncontested evidence on this matter to be credible and clear. I accept his evidence that the Respondent failed to comply with the rules of fair procedures and natural justice and the minimal requirements set out in S.I. No. 146/2000 Code of Practice on Grievance and Disciplinary Procedures in reaching the decision to dismiss him. 

Section 6(6) imposes the burden of proof on the employer to show that the dismissal was fair. I accept the Complainant’s uncontested evidence that there was no reason provided for his dismissal. While the termination of an employee’s contract on a “no fault” basis may be considered permissible under the principles of contract law, the 1977 Act creates a presumption that every dismissal is unfair unless it can be justified on substantial grounds as provided for under the Act.  

I am satisfied that the Respondent is unable to shift the burden of proof in this case. I am satisfied that the dismissal of the Complainant was not based on any of the reasons outlined in Section 6(4) of the Act.   Accordingly, I find that the Complainant’s dismissal was both substantively and procedurally unfair.

Redress

Based on the evidence presented at the hearing I note that a Liquidator has been appointed to act on behalf of the Respondent. I am satisfied that the appropriate form of redress, having regard to all the circumstances, is that of compensation. The Act provides that an Adjudication Officer can order compensation for financial loss (which is defined as including any actual loss and any estimated future loss) attributable to the dismissal, as “is just and equitable” having regard to all the circumstances, of up to a maximum of 104 weeks remuneration.

Date of Dismissal

I am required to determine the correct date of dismissal in order to clarify the correct period for the  purposes of calculation of the Complainant’s financial loss, pursuant to Section 7(1)( c ).

The Complainant asserted at the hearing that the correct date of his dismissal is the 14/2/22 on the grounds that he only received one payment of €12,577 on the 10/3/22 while on garden leave, and  he did not receive any monies thereafter. It is submitted that placing the Complainant on garden leave for 6 months was a fiction and that the payment of €12,577 does not affect his dismissal date.

Section 1 in the relevant part defines “date of dismissal” as: 

“date of dismissal” means—

(a) where prior notice of the termination of the contract of employment is given and it complies with the provisions of that contract and of the Minimum Notice and Terms of Employment [Acts 1973 to 2005], the date on which that notice expires,

(b) where either prior notice of such termination is not given or the notice given does not comply with the provisions of the contract of employment or the Minimum Notice and Terms of Employment [Acts 1973 to 2005], the date on which such a notice would have expired, if it had been given on the date of such termination and had been expressed to expire on the later of the following dates—

(i) the earliest date that would be in compliance with the provisions of the contract of employment,

(ii) the earliest date that would be in compliance with the provisions of the Minimum Notice and Terms of Employment Acts 1973 to 2005.

I accept the Complainant’s uncontested evidence that he was provided with six months’ notice in accordance with clause 9.3 of his contract, that he was placed on garden leave for the duration of his notice period and only received one payment of €12,577 on the 10/3/22 and did not receive any other payment while on garden leave.     

I am of the view that Section 1 (b) applies to the facts of this case as the Complainant was entitled to receive payment for 6 months during his notice period while on garden leave in compliance with the provisions of his contract and only received one payment. Applying Section 1(b) to the facts of this case, the date on which such a notice would have expired, if it had been given on the date of such termination is the 14/8/22. Applying the second part of the test to determine the later date between both dates as provided for at Section 1 (b) (i) and (ii), considering that 14/8/22 is the later date between both dates, I am satisfied that, in accordance with Section 1 (b), the date of dismissal is the 14/8/22.

Calculation of Financial Loss

The maximum jurisdiction under Section 7(1)(c)(i) refers to two years’ remuneration, and it refers to all the elements of an employee’s compensation package, not simply salary/wages. The Complainant’s monthly remuneration package included his basic salary, a pension contribution, and a contribution to a company car and medical insurance. The WRC received a post hearing submission and a pay slip in respect of the Complainant’s monthly salary from the Respondent dated 9/12/2021 and pay slips with the Complainant’s new employer dated 25/10/2022, 24/11/2022. The Complainant submitted that the correct monthly remuneration figure is €17,944.60 which I accept based on the evidence submitted. Considering the Complainant’s monthly remuneration figure is of €17,944.60, the maximum amount of compensation that I can award in this case is €430,670.40 equivalent to two years’ salary.

Calculation of Award

For the purposes of calculating the award, I must have regard to Section 7 (2) (a) (b) (c) (d) (e) and (f) of the Act as outlined above. Specifically, I must consider the conduct of the Respondent as well as the Complainant in relation to the dismissal, their conduct in relation to their contribution to the Complainant’s financial loss and have regard to the efforts made by the Complainant to mitigate his financial loss.

I am mindful that I have heard the evidence of one party only and did not have the benefit of hearing the evidence on behalf of the Respondent.  I note the manner in which the Respondent carried out the Complainant’s dismissal by way of a resolution passed by a majority of Directors who were present at the Board of Director’s meeting on the 14/2/2022, where the Complainant was asked to leave and did not return further to the resolution being passed.   

As a long-standing employee with 32 years of service, the Respondent’s approach to the Complainant’s dismissal, in my view, shows a distinct lack of regard for both the Complainant’s procedural rights and the dignity of the Complainant.

Counsel for the Complainant submitted that the Complainant is seeking the payment of a bonus payment further to the terms of his contract set out at clause 5.2 of his contract. No evidence was adduced before me to demonstrate that the Complainant has an entitlement to a bonus payment further to the terms of his contract, nor was it submitted that a bonus payment formed part of the Complainant’s remuneration when calculated in accordance with the Regulations made under Section 17 of the Act. Accordingly, I am satisfied that the bonus payment does not come within the remit of remuneration for the purposes of calculating the Complainant’s financial loss.       

In terms of mitigation, I am satisfied that the Complainant has made sufficient efforts to mitigate his losses and secured alternative employment from the 11/7/2022 at the same level of CEO, albeit on a lower salary. I note from pay slips provided by the Complainant that he earns a monthly remuneration figure of €9,485.35 which leaves a shortfall of €8,459.25 in comparison to his previous remuneration package.  Accordingly, in terms of actual loss, calculated from the date of dismissal to the hearing date, the Complainant has incurred a loss of €67,674 which I am awarding to the Complaint in compensation for actual loss.

I am mindful that in considering compensation, regard must be had to all the subsections of Section 7. In this case the Respondent is found not to have met the tests set out in subsections (d) and (e) and the Complainant made no contribution to the decision to dismiss him under (f). I am satisfied that the Complainant has met the test under (c) to mitigate his losses.

It is my view that the assessment of future losses is a speculative matter. In light of the foregoing, I find that the Complainant is entitled to compensation for actual, ongoing and future losses in the sum of €126,888 which I consider just and equitable in the circumstances of this case.   

I find that the Complainant was unfairly dismissed by the Respondent within the meaning of Section 6 of the Unfair Dismissals Acts for the reasons set out above. Accordingly, I find that the complaint is well founded. I determine that at an award of compensation to include actual, on-going and future loss to be the appropriate award in the circumstances of this case. I require the Respondent/Liquidator on behalf of the Respondent to pay the Complainant €126,888 in compensation.

“no fault” dismissal, date of dismissal, financial loss,