Complainant

Respondent

Parties

Frank  Lewis

The Yellow Phoenix Limited

Representatives

Self-Represented

Self-Represented

Act

Complaint Reference No.

Date of Receipt

Complaint seeking adjudication by the Workplace Relations Commission under Section 39 of the Redundancy Payments Act, 1967

CA-00054659-001

24/01/2023

The Complainant commenced employment with the Respondent on 12th January 2019. The Complainant was a permanent member of staff, in receipt of an average weekly wage of €358.00. The Complainant alleged that his employment terminated on 14th November 2022.

On 24th January 2023, the Complainant referred the present complaint to the Commission. Herein, he alleged that he was entitled to a statutory redundancy payment following the closure of the premises where he was employed. In denying this allegation, the Respondent submitted that an offer of alternative employment disentitled the Complainant to a redundancy payment under the Act.

A hearing in relation to this matter was convened for, and finalised on, 26th June 2023. Both parties issued extensive submissions in advance of the hearing. Said submissions were expanded upon and contested in the course of the hearing. The Complainant gave evidence in support of his complaint, while the Managing Director gave evidence in defense. All evidence was given under affirmation and opened to cross examination by the opposing side.

No issue as to my jurisdiction to hear the complaint was raised at any stage of the proceedings.

The Complainant commenced employment with the Respondent on 12th January 2019. At all times the Complainant was engaged as a chef, based in the Respondent premises.

On 17th October 2022, the Complainant received an email advising that the Respondent premises would permanently close in the coming weeks. In evidence, the Complainant submitted that the Respondent did ask him to work in a proposed new premise, however nothing concrete was ever offered to him. On 15th December 2022, the Complainant served form RP77 on the Respondent, however no response was received.

In January, the Complainant sent a text message to the Managing Director seeking a reference in relation to a new employment. At this point, the Respondent requested that the Complaint resign from his employment. In circumstances whereby the Complainant believed that he had been made redundant, he refused to provide the same. By correspondence dated 17th January, the Respondent assumed the Complainant’s resignation.

By submission, the Complainant stated that he had been made redundant when the Respondent’s premises closed on 14th November 2022. He denied that he had ever been issued with a suitable alternative to redundancy and submitted that the new premises proposed by the Respondent never in fact opened.

In denying the Complainant’s allegation, the Respondent submitted that he became disentitled to a redundancy payment by his failure to accept an alternative to redundancy.

The Respondent accepted that the Complaiannt was engaged as a chef at their primary place of business. They further accepted that this premises permanently closed on 14th November 2022. However, they submitted that they were in the process of permanently opening a new premises elsewhere. In this regard, it was submitted that the Complainant had previously worked in this premises in the recent past. When the Respondent’s primary premises closed, the parties agreed that the new premises would remain closed for the quieter winter period, and that the same would re-open the following February. In this regard, it was submitted that the Complainant was placed on lay-off for this period.

In January, the Complainant sent a text message to the Respondent asking for the provision of a reference. At this point, the Respondent advised that they were happy to provide a reference for the Complainant but would require his resignation prior to the same. When the Complainant failed to provide the same, a further email in this regard was issued on 17th January. As this email did not prompt a response from the Complainant, a final email was issued on 30th January. At this point, the Respondent stated that as a consequence of the Complainant’s failure to respond to previous emails, the Respondent assumed that the Complainant had resigned his employment.

As a consequence of the staffing issues experienced by the Respondent, the premises was unable to open in February. At the date of the hearing, the Respondent had ceased trading.

By submission, the Respondent submitted that the Complainant’s employment had not terminated on the grounds of redundancy. They submitted that a viable alternative employment was available to the Complainant. Regarding the termination itself, they submitted that the Complainant resigned his employment whilst on lay-off and consequently had no entitlement to a statutory notice payment.

The present complaint involves an allegation that the Complainant was made redundant when the premises he normally performed his duties ceased trading. In disputing this complaint, the Respondent submitted that the Complainant was placed on a lay-off following the closure of this premises and had agreed to commence employment in a new premises due to open some months later. They submitted that the Complainant resigned his employment during this period of lay-off and consequently had no entitlement to a statutory notice payment.

In this regard, it is noted that Section 7(2) of the Act provides that,

“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 purpose 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”

Having regard to the foregoing, it is apparent that the closure of the premises where the Complainant was employment would, ordinarily, entitle the Complainant to a statutory notice payment.

Notwithstanding the same, the Respondent submitted that the Complainant was placed on a period of lay-off pending the opening of a proposed new premises. In this regard, Section 11 states that lay-off occurs whereby,

“…an employee’s employment ceases by reason of his employer’s being unable to provide the work for which the employee was employed to do, and (a) it is reasonable in the circumstances for that employer to believe that the cessation of employment will not be permanent, and (b) the employer gives notice to that effect to the employee prior to the cessation….”

The Respondent’s submission in this regard is that the Complainant agreed to a period of lay-off from the closure of the premises in November 2022, to the proposed opening of the new premises in February 2023. They submitted that during this period the Complainant sought a reference in respect of a new employment and following a subsequent failure on his behalf to correspond with the Respondent, they assumed his resignation.

The first point to note in relation to the same, is that seeking new employment during a period of lay-off does not automatically mean that an employee seeks to terminate the terminate the former contract of employment. In the matter of Industrial Yearns v Greene [1984] I.L.R.M. 15, Costello J. held that during a period of lay-off there is a “cesser of employment, but the contract still subsists”. Likewise, in the matter of McDonagh -v- Shoreline Taverns [2014] 25 E.L.R. 98 the Employment Appeals Tribunal held that during a period of lay-off a contract is “temporarily suspended”. In such circumstances, there is no basis for the Respondent to assume the Complainant’s resignation during the period of suspension and no basis for their subsequently terminating the contract of employment on the basis of this assumption.

The Respondent submitted that the Complainant terminated his contract of employment and consequently disentitled himself from a statutory redundancy payment under the terms of the Act. In the alternative, the Complainant stated that he was asked to resign, but did not do so as he believed he was entitled to a redundancy payment. In the matter of Millett -v- Sherkin [2004] 15 E.L.R. 319, the Labour Court held that,

“A resignation is a unilateral act which, if expressed in unambiguous and unconditional terms, brings a contract of employment to an end. The contract cannot be reconstructed by the subsequent unilateral withdrawal of the resignation.”

Having regard to the factual matrix presented, it is not apparent that the Complainant expressed his intention to resign in “unambiguous and unconditional terms” - indeed to it appears that the opposite is the case.

Having regard to the totality of the foregoing points, I find that the Respondent placed the Complainant on a period of lay-off and thereafter terminated his contract of employment. In circumstances whereby this termination occurred just before the purported, and ultimately unsuccessful, opening of the new premises, I find that the termination of employment was on the grounds of redundancy. As a consequence of the foregoing, I find that the Complainant is entitled to a statutory redundancy payment and his appeal is successful.

Section 39 of the Redundancy Payments Acts 1967 – 2012 requires that I make a decision in relation to the complaint in accordance with the relevant redress provisions under that Act.

Having considered all of the information presented to me and giving appropriate weighting to the direct evidence adduced, I am satisfied that the Complainant has established the existence of a redundancy situation and the appeal succeeds.

I find that the complainant is entitled to a statutory redundancy payment based on the following:

Date employment commenced:  12th January 2019

Date Employment ceased:           14th November 2022

Gross Weekly wage:                      €358.00

The entitlement is contingent on the Complainant having been in insurable employment in accordance with the Social Welfare Acts for the relevant period.

Redundancy, Lay-Off, Termination