Complainant

Respondent

Parties

Laurence McDonald

Pharmtrans Direct Limited

Representatives

Mr John Hayden 

Mr Anthony Saul

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-00058279-001

14/08/2023

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

CA-00058279-002

14/08/2023

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

CA-00058279-003

14/08/2023

Complaint seeking adjudication by the Workplace Relations Commission under Section 12 of the Minimum Notice & Terms of Employment Act, 1973

CA-00058279-004

14/08/2023

Complaint seeking adjudication by the Workplace Relations Commission under Section 12 of the Minimum Notice & Terms of Employment Act, 1973

CA-00058279-005

14/08/2023

Complaint seeking adjudication by the Workplace Relations Commission under Section 12 of the Minimum Notice & Terms of Employment Act, 1973

CA-00058279-006

14/08/2023

Complaint seeking adjudication by the Workplace Relations Commission under section 6 of the Payment of Wages Act, 1991

CA-00058279-007

14/08/2023

Complaint seeking adjudication by the Workplace Relations Commission under section 6 of the Payment of Wages Act, 1991

CA-00058279-008

14/08/2023

Complaint seeking adjudication by the Workplace Relations Commission under section 27 of the Organisation of Working Time Act, 1997

CA-00058279-009

14/08/2023

The respondent is a van delivery business.  Until June 16th 2023, they had a contract to deliver pharmaceutical products for Uniphar, a pharmaceutical supply chain company.  Twelve drivers were employed to do this work, supported by an office administrator.  One of the drivers had the role of manager.

The complainant commenced working for the respondent on April 16th 2021.  He earned €2,153.30 gross per month, regardless of the hours he worked.  His net pay was €2,010.

The drivers were paid on the 16th of each month.  Around 10.00am on Friday, June 16th 2023, they received a text message from the office administrator informing them that there had been a technical error in the bank and that wages would not be paid.  The administrator said that it would be sorted out the following week.  She said that the director, Mr Saul, was travelling home from Spain and that he would lodge money to the company’s bank account so that each employee could be paid €500 to keep them going until the bank problem was resolved.

At the hearing, the complainant said that the morning that they heard that there was a problem with their wages, the drivers exchanged phone calls and text messages and they considered stopping work.  Based on the offer to pay them €500 as an interim payment, they decided to continue working.  Some of the drivers also worked the next day, June 17th, which was a Saturday.

In his evidence at the hearing, Mr Hayden said that, around 4.15pm on Friday, June 16th 2023, he got a telephone call from the transport manager in Uniphar.  The manager told Mr Hayden that their employer, Pharmtrans Direct Limited had ceased trading.  He offered the 12 drivers an opportunity to start work the following Monday for Alltrans, a company with a contract to deliver for Uniphar.

Another driver, Mr Brian Kelly also said that he got a call from the manager of Uniphar who told him that he wouldn’t be dealing with Pharmtrans Direct any longer.  Mr Kelly was offered a job with Alltrans, but he said, “no thanks."  He said that he lost faith in Pharmtrans Direct and Uniphar and he decided not to go to work for Alltrans.  He found another job five weeks later.

The complainant gave evidence at the hearing and said that he got a phone call from the manager in Uniphar around 4.00pm on June 16th and he told him that Alltrans would take them all on from Monday, June 19th.

Michael Cahill is the manager of the drivers.  He said that he was getting calls from the drivers all morning on June 16th about the wages problem.  He spoke to the office administrator and she told him about the plan to pay everyone €500 until the wages were sorted out.  Mr Cahill said that he had left work early that day to go to a concert in Malahide.  Around 6.00pm, the manager from Uniphar phoned him to offer him a job with Alltrans.  At first, he said that he didn’t accept the offer.  However, he then heard that Alltrans were offering a loan of €1,500 to make up for the wages not paid by Pharmtrans Direct, and he decided to accept the job.  He said that the drivers are now paid weekly and they are paying back the loan at €28.00 every week.

The complainant claims that he was dismissed on June 16th 2023, and that his dismissal was unfair.  He claims that, as his employer has ceased trading, he is entitled to a statutory redundancy payment.  He claims that, in contravention of s.5 of the Payment of Wages Act 1991, his employer failed to pay him wages that were due on June 16th 2023, and pay for holidays not taken at the termination of his employment.  He also claims an entitlement to pay in lieu of notice. 

In his evidence at the hearing, the company director, Mr Saul, said that he has lived in Spain for many years and he wasn’t involved in the day to day running of the company.  His son in law is in charge and his niece manages the office and payroll.  During the Covid-19 pandemic, Mr Saul said that the company lost some of its small contracts and that tax that had been warehoused had to be paid in 2023.  He said that he became aware that there was a problem with the Revenue Commissioners two weeks before the company ceased trading and he travelled back to Dublin to sort things out.

Mr Saul said that his main contract was with Uniphar and the 12 employees were delivering for that business.  The contract was valued at €97,000 per month including VAT.  Mr Saul said he was informed that Uniphar was contacted by the Revenue Commissioners and instructed not to pay the June invoice and to pay the €97,000 to Revenue instead.  The effect of this was that there was no money to pay the wages of the 12 drivers.  Mr Saul said that he attempted to negotiate with Revenue, but the money could not be returned.

On June 16th 2023, Mr Saul said that he was travelling by boat from Spain and he was informed about what happened.  He said that he borrowed €10,000 so that he could pay €500 to each of the drivers as a stopgap.  He said that he was advised by Uniphar that he could apply to take on the contract as a new vendor, and he set up another company to do that.  He then discovered that it would take over a week to get set up as a new vendor and he wouldn’t be able to fulfil the contract in the meantime.

Mr Saul said that his company has ceased trading and that he has no money to pay the wages due to the drivers.  He said that if receives any money, he will pay it to the drivers.

CA-00058279-001:  Complaint under the Unfair Dismissals Act 1977

At the hearing, Mr Saul was unequivocal in his evidence that his company has ceased trading, a circumstance that falls squarely within the definition of redundancy at s.7(2)(a) of the Redundancy Payments Act 1967:

…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[.]

Section 6(4)(c) of the Unfair Dismissals Act recognises the right of an employer to dismiss an employee due to redundancy: 

 “…the dismissal of an employee shall be deemed, for the purposes of this Act not to be an unfair dismissal if it results wholly or mainly from

(c) the redundancy of the employee.”

Section 6(3) of the Unfair Dismissals Act provides that the right to dismiss for reasons of redundancy is predicated on an obligation to select employees for redundancy based on fairness and to adhere to an agreed procedure or a code of practice regarding dismissals.  In 1993, an amendment was inserted into the Unfair Dismissals Act at s.6(7), which provides that, when considering a complaint of unfair dismissal, I, as the adjudicator, may have regard to the “reasonableness or otherwise of the conduct… of the employer in relation to the dismissal” and compliance with codes of practice related to dismissal. 

Mr Saul’s evidence is that his business ceased trading when he wasn’t able to pay his employees.  When this became apparent to Uniphar, the contract that he had with them was taken on at short notice by another company.  I accept that Mr Saul was in financial difficulties; however, the way that his employees lost their jobs was completely disorganised, with no regard for notice or procedures.  Mr Saul’s failure to act responsibly was the cause of stress and worry for the complainant and his colleagues and is not how a reasonable employer would act in the same circumstances.  It is of particular concern that the complainant lost his job on the day that his monthly wages were due to be paid and that his wages were not paid.  For these reasons, the only conclusion I can reach is that the dismissal of the complainant was unfair.

CA-00058279-002:  Complaint Under the Redundancy Payments Act 1967

We know from the evidence submitted at the hearing that the complainant’s employer has ceased operations in the place where he was employed.  I am satisfied therefore, that his job has become redundant.  As he has completed more than two years of service, he is entitled to a redundancy payment. 

CA-00058279-003:  Complaint Under the Redundancy Payments Act 1967

On the form he submitted to the WRC, the complainant ticked the box to indicate that he did not receive proof of his employer’s inability to pay a redundancy payment.  At the hearing, the director, Mr Saul, gave evidence that his company has ceased trading and that he has no money to pay a redundancy lump sum to the complainant.

CA-00058279-004:  Complaint Regarding the Failure to Pay in Lieu of Notice

There was no dispute at the hearing regarding the fact that the complainant got no notice of the termination of his employment and his complaint in this regard is well founded.

CA-00058279-005:  Complainant’s Regarding Rights During Notice

This complaint relates to a breach of s.5 of the Minimum Notice and Terms of Employment Act and is concerned with a contravention of the Second Schedule of the Minimum Notice and Terms of Employment Act regarding the rights of an employee to work their normal hours during their notice.  As the complainant did not receive any notice, his complaint under section cannot be upheld.

CA-00058279-006:  Complaint Regarding Rights During Notice

This is a complaint related to the right of an employer to notice and it is not relevant to the complainant’s circumstances.

CA-00058279-007:  Complaint Regarding the Non-Payment of Wages

Section 5(6) of the Payment of Wages Act 1991 provides that, to ground a complaint under the Act, wages must be properly payable:

(6) Where—

(a) the total amount of any wages that are paid on any occasion by an employer to an employee is less than the total amount of wages that is properly payable by him to the employee on that occasion (after making any deductions therefrom that fall to be made and are in accordance with this Act), or

(b) none of the wages that are properly payable to an employee by an employer on any occasion (after making any such deductions as aforesaid) are paid to the employee,

then, except in so far as the deficiency or non-payment is attributable to an error of computation, the amount of the deficiency or non-payment shall be treated as a deduction made by the employer from the wages of the employee on the occasion.

At the hearing, there was no dispute between the parties regarding the failure of the respondent to pay the complainant the wages that were due to him on June 16th 2023.  Based on the evidence, I am satisfied that, on June 16th 2023, the complainant suffered an illegal shortfall in his wages of €2,153.30 gross, or €2,010 net.

At the termination of his employment the complainant said that he did not receive holiday pay due to him of €1,274.65.  Mr Saul did not dispute this evidence, and he provided no records of the complainant’s holidays.  Based on the evidence of the complainant, I am satisfied that he is entitled to pay for holidays not taken at the termination of his employment.

CA-00058279-008:  Complaint Regarding the Failure to Pay in Lieu of Notice

This complaint has been considered under the heading of CA-00058279-004 above.

CA-00058279-009:  Complaint Under the Organisation of Working Time Act 1997

This is a complaint regarding the entitlement of an employee to weekly rest in accordance with s.13 of the Organisation of Working Time Act.  This complaint was not pursued at the hearing.

CA-00058279-001:  Complaint under the Unfair Dismissals Act 1977

I decide that this complaint is well founded.  Considering the amount to be awarded in redress, s.7(1)(c) of the Unfair Dismissals Act requires me to consider the financial loss attributable to the dismissal of the complainant.  In his evidence, he said that he started working for Alltrans on the Monday after his dismissal from Pharmtrans Direct Limited.  As the complainant continued in employment without any break, I direct the respondent to pay him compensation of €1,987.68, equivalent to four weeks’ gross pay.  This award is in the form of loss of earnings and is subject to normal deductions of tax, PRSI and USC.

CA-00058279-002:  Complaint Under the Redundancy Payments Act 1967

I decide that this complaint is well founded and I direct the respondent to pay the complainant a statutory redundancy payment of €2,653.55.  This is based on the complainant’s start date of April 16th 2021, his termination date of June 16th 2023 and his wages of €496.92 per week.  This calculation is on condition that all the complainant’s service is reckonable and in accordance with Schedule 3 of the Redundancy Payments Act.  Statutory redundancy payments are tax free and are not subject to deductions for PRSI or USC.

CA-00058279-003:  Complaint Under the Redundancy Payments Act 1967

I decide that this complaint is well founded.  There is no provision for an award of redress under this heading.

CA-00058279-004:  Complaint Regarding the Failure to Pay in Lieu of Notice

I decide that this complaint is well founded.  The complainant worked for the respondent for 26 months.  In accordance with s.4 of the Minimum Notice and Terms of Employment Act 1973, he is entitled to two weeks’ notice.  I therefore direct the respondent to pay the complainant compensation of €993.84.  As this compensation is for a breach of a statutory right, it is not subject to deductions for tax, PRSI or USC.

CA-00058279-005 and 006:  Complaint Regarding Rights During Notice

I decide that these complaints are not well founded.

CA-00058279-007:  Complaint Regarding the Non-Payment of Wages

I decide that this complaint is well founded.  In accordance with section 6 of the Payment of Wages Act (as amended), I am required to direct the respondent to pay compensation as a net amount.  I decide therefore, that the respondent is to pay the complainant compensation of €3,284.65, comprising €2,010 in unpaid wages and €1,274.65 in lieu of holidays not taken at the termination of his employment.  This is a net amount and is not subject to deductions for tax, PRSI or USC.

CA-00058279-008:  Complaint Regarding the Failure to Pay in Lieu of Notice

This complaint has been adjudicated on under CA-00058279-004 above.

CA-00058279-008:  Complaint under the Organisation of Working Time Act 1997

I decide that this complaint is not well founded.

Summary of Redress Awarded

In summary, I direct the respondent to pay the complainant compensation of €6,932.04 which is not subject to deductions and a further €1,987.68 which is subject to deductions.

Company ceased trading, unfair dismissal, redundancy, non-payment of wages, non-payment of holidays, minimum notice