20/09/2022

April 2022 has been a fairly quiet month, we have just a few updates.

Legislation

In the UK the requirement for employers to automatically enrol eligible employees into a pension scheme commenced almost 10 years ago, however no equivalent exists in Ireland.

The Minister for Social Protection has now announced details of the “design principles” for the automatic enrolment retirement savings system for Ireland. These design principles will most likely form the basis of draft legislation.

The auto-enrolment system will apply to all employees who meet certain age and earnings thresholds, and who are not already members of an occupational pension scheme. Eligible employees will be automatically enrolled in a pension scheme but will have the choice after six months participation to “opt out” or suspend participation. Those who opt out will be automatically re-enrolled after two years.

Under auto-enrolment, employees will be required to make certain minimum contributions to a pension scheme and employers will be obliged to match those contributions, which will then be topped up by the state. At this stage the key proposals are:

• All employees who are not already in an occupational pension scheme, aged between 23 and 60 and earning over €20,000 across all their employments, will be automatically enrolled in the scheme (which will have a range of four retirement savings funds to choose from);
• Employer and employee contributions will start at 1.5% in 2024 and will increase by 1.5% every three years until they eventually reach 6% by 2034;
• Employers will be required to match contributions made by employees up to an earnings threshold of €80,000;
• In addition to employer contributions, the state will also top up contributions by €1 for every €3 saved by the employee, up to a maximum of €80,000 of earnings;
• After six months, employees will be able to opt out or suspend participation. After two years, those employees who opted out will be automatically re-enrolled;
• Of the four funds to choose from, three will have differing risk/return profiles and one default fund based on a “lifestyle” or “life cycle” investment profile. People who do not express any preference for a fund will be enrolled into the default fund.

Case law

Paul Dunne v Randox Teoranta,

The Complainant was a research scientist employed by the Respondent for 6 years prior to his dismissal and with a good work record. In October 2019 he was assigned a new line manager.

The Complainant had exercised a certain amount of autonomy and discretion in performing his role albeit reporting to the line manager when selecting the best antibodies to use in lab tests. In the circumstances giving rise to this claim, the Complainant had been instructed by his line manager to use a particular conjugate. However he went against his line manager’s instructions and tested the conjugate he had been told not to use.

The Complainant was suspended and, following an investigation, a disciplinary meeting was convened. The Respondent found the Complainant’s behaviour amounted to gross misconduct and he was summarily dismissed.

The WRC however found the dismissal was unfair and the Complainant was awarded €25,000 compensation. However, the Adjudicator held that the Complainant’s conduct “contributed significantly to his dismissal” and for that reason he reduced the award of compensation by 50%.

Decision: At the Hearing the Respondent focussed on 2 issues: the failure to obey a legitimate instruction; and the potential consequences for the Company arising from that failure. It was not in dispute that the Complainant had failed to follow the instruction given by his line manager, but the Complainant argued that he did not take the instruction as covering testing in the pre-verification stage. He stated that did not try to hide the fact that he had tested the product and made the appropriate records relating to the test he had carried out which were available for inspection. He made it clear in the records that it was not to be used in verification.

The Adjudication Officer noted that the investigator had not appreciated the distinction between testing at pre-verification and verification stages and that he had not met with the Complainant as part of his investigation. It was also found that the investigation had gone further than a fact-finding exercise as the investigation report commented on the Complainant’s culpability even though he had not been given an opportunity to explain his actions.

The Adjudication Officer noted that failure to obey a legitimate instruction is serious but must be looked at in context. It was also noted that the proportionality of any penalty must be inked to the gravity of the potential consequences.

The Adjudication Officer found it difficult to understand how the distinction between the potential gravity of the test being applied at pre-verification as opposed to verification stage did not mitigate the decision to dismiss and the employer’s action was found to be unfair.

Whilst an investigation report forms an important part of the overall process, it is crucially important at the outset to establish the investigators terms of reference. The role of the investigator will be to gather facts, but findings in relation to culpability or guild should never be made at the investigation stage. It is also difficult to understand why the investigator did not meet with the Complainant as part of the investigation; this led to the report being one-sided and the investigator not understanding the Complainant’s case, however we would have expected this to have been rectified during the disciplinary/appeal processes. Finally, the Adjudicator’s decision relied heavily on ‘the context’ of the misconduct when deciding on the proportionality of the sanction. Therefore, when communicating disciplinary outcomes it is important to clearly explain not only the basis for the findings but also the reason why the sanction is deemed appropriate.