18/09/2022

Redundancy developments

 

Suspension lifted on employees triggering redundancy

 

An employee who has been placed on lay-off or short-time working can, provided certain conditions are met, trigger redundancy.

 

In the Republic of Ireland, as part of the government’s pandemic response, an employee’s ability to trigger redundancy was temporarily suspended. This meant that where an employee was, for example, laid off for four or more consecutive weeks, they could not claim a redundancy payment.

 

From 30 September 2021 this suspension has been lifted. This means laid off employees once again have the right to trigger redundancy and to claim a statutory redundancy payment, provided they meet the relevant criteria.

 

Statutory redundancy payments – compensation for loss of reckonable service during lay-off

Employees must have 2 years continuous service to be entitled to a statutory redundancy payment.

Employees continue to accrue continuous service while on lay-off. However, certain absences from work, including lay-off, are not deemed to be “reckonable service” when calculating a statutory redundancy payment.

In recognition of the impact of Covid-19 the Irish Government has announced a new special payment of up to €1,860 to employees who have been made redundant and who have lost out on reckonable service while laid off during the pandemic. This payment will be made available in the first half of 2022.

 

Case Law Review

 

Sexual Harassment – important takeaways from the Labour Court

 

This case attracted a significant level of media attention as it involved a well-known coffee chain and 19-year-old employee who was sexually harassed by her manager.

 

The acts of harassment arose from posts made by the manager to a group of Respondent employees on Facebook messenger. The employee was part of the Facebook group; she went on sick leave and later resigned.

 

The Respondent accepted the manager’s conduct, which included the posting of offensive pictures, constituted sexual harassment. In light of this concession the case focussed on whether the Respondent could prove that it had taken adequate steps to prevent the behaviour occurring.

 

The WRC upheld the complaint and awarded the Complainant €3,500. On appeal the Labour Court expressly disagreed with the WRC’s view that the acts fell in the less serious category and increased the award to €20,000 (approximately 1 year’s earnings.)

 

In addition to increasing the value of the award the Labour Court noted that whilst the Respondent had a bullying and dignity at work policy, it was shocked that there was no specific sexual harassment policy.  The Labour Court ordered the Respondent to:

• Develop a workplace anti-harassment and sexual harassment policy that complies with the relevant statutory Code of Practice;
• Develop a workplace anti-bullying policy that complies with the relevant statutory Code of Practice;
• Develop an appropriate Social Media policy;
• Take the necessary steps to ensure the policies were communicated to, and understood by, all employees. This included raising awareness raising and providing training.

In this case the fact the employer had a bullying and dignity at work policy was not deemed sufficient. The Court stated “The policy on which the Respondent relied in making arguments to the Court is, in fact, a policy on bullying and dignity in the workplace rather than one that covers sexual harassment. This extraordinary oversight meant that not alone was there no training provided to employees on sexual harassment but, it could be argued, there was no express prohibition on such behaviour.”

The Court went on to state: “It hardly needs to be said that the Respondent needs to have a full suite of policies regarding the legal protections that they are required to put in place to ensure that staff are protected from recurrences of this type of incident.”

This decision is another example of the importance placed on employment policies, and their communication and enforcement in the workplace. In addition to setting standards for employees, policies and procedures must also set standards for managers. It is important that employees at all levels of seniority receive appropriate training and guidance in respect of how they must conduct themselves and the standards they will be held to.

 

Use of CCTV in disciplinary proceedings and “zero tolerance”

This decision was published in late September 2021 and concerns the termination of employment of a bus driver who was caught on CCTV footage on his mobile phone whilst driving. The use of mobile phones whilst driving was strictly forbidden by the Respondent and considered gross misconduct.

There was no dispute the Complaint was guilty of the misconduct. The case before the WRC focussed on procedural issues.

The background to the dismissal was that the Complainant was the subject of a customer complaint (from which he was exonerated). While viewing the CCTV footage as part of that investigation, the Complainant was spotted using the mobile phone. However, that footage was captured an hour after the original incident being investigated.

The Complainant argued the Respondent should not have been viewing that portion of the CCTV footage. He alleged a breach of data protection law and a breach of the employer’s own CCTV policy as there was no provision for its use in disciplinary proceedings.

The WRC accepted it had no jurisdiction in relation to breaches of data protection law. However, it found that it is critical to the operation of fair procedures that an employer follow its own policies and procedures. It found the Respondent did not do so in this case as the CCTV policy did not expressly provide for the use of CCTV in disciplinary procedures. Somewhat harshly, in our view, the WRC did not accept the statement in the CCTV policy that it could be used “for the safety of the organisation’s employees, customers, visitors and contractors” could cover discipline in these circumstances given there was a safety concern. The WRC also stated that had the Respondent tried to rely on “performance and public safety” it would have stretched the scope of the policy beyond what was intended.

The WRC found the most second and most serious issue was the manner in which the “zero tolerance” policy was applied. The Respondent confirmed at the hearing that in all cases mobile phone use will result in termination of employment. The WRC found this “represents a policy on the part of the respondent that constitutes prejudgement in respect of both guilt and of sanction.”

Despite the fact the Complainant, a driver by occupation, did not dispute that he was using the mobile phone whilst driving, his dismissal was held to be unfair. Indeed, whilst the WRC found this was a serious incident, it granted the Complainant’s request for reinstatement and awarded over one year’s back pay.

There are a number of takeaways from this case:

1. The importance of a well drafted and comprehensive CCTV policy and employee privacy notice covering the use of CCTV footage for disciplinary purposes;

 

2. Ensuring there is a authorised and legitimate reason to check CCTV footage. In this case the employer could provide no explanation why it continued to view footage after the original purpose had ended. The WRC called this a “speculative fishing expedition”;

 

3. Employees have a constitutional right to a fair and unbiased hearing. It is not unusual for employers, especially those in regulated sectors, to have a “zero tolerance” approach to certain misconduct. However the utmost care must be taken when drafting any disciplinary rules and conducting disciplinary proceedings. Language in an outcome letter such as “I have no option but to dismiss”, or a policy that appears to bind the decision maker to dismiss, will risk a dismissal being found to be unfair.

 

 

Two recent redundancy decisions of note

 

Tanneron Limited v Gerard Conolin is a Labour Court decision in which a redundancy dismissal was found to be unfair on the basis the employer’s process failed to meet the required impersonal and objective test.

 

In this case the selection was based on fee income and sales over the previous 12 months.

 

The Respondent’s evidence was that, following application of the criteria, it was surprised the Complainant was scored lowest in respect of both fees and sales in that period. The Complainant argued that when the Respondent set the criteria it was clear who would be the first to go. He submitted he was dismissed for poor performance and his dismissal was “dressed up” as a redundancy thereby denying him the right to be advised of his alleged underperformance and given an opportunity to improve.

 

The Labour Court considered the size of the organisation and the small number of employees and found it was unlikely that management would not be aware when setting the criteria who was likely to be affected. The Respondent failed to convince the Court that the Complainant had not been singled out on the basis he was a poor performer. The dismissal was found to be unfair. Despite the fact the Complainant was found to have fell short of what was expected in terms of mitigation of loss, he was awarded €23,000 compensation on top of the sums he had already received in respect of his redundancy.

 

In this case the Respondent had received legal advice to apply a matrix of criteria. Had that advice been followed the outcome of this case may have been different, especially if criteria unconnected to performance had also been used.

 

In Aoife Murphy v The Sims Clinic Ltd, the WRC found a Complainant had been unfairly dismissed as the Respondent failed to consider all alternatives to making her redundant.

The WRC found the alternatives the employer should have considered included:

• a position in another department of the business as the Complainant had transferable skills;
• unpaid leave or a career break for a few months, to monitor the business with a view to retaining the Complainant for a suitable role in the future; and
• a part-time position supporting a number of departments of the business.

 

The WRC found “no problem-solving or creative thinking went into coming up with a proposal to retain the complainant in employment.” It stated this could have involved any one or a combination of the options listed.

 

Unsurprisingly the WRC held that the responsibility rests with the employer, not the employee, to identify alternatives to redundancy. What is of note are the lengths the WRC expected the employer to go to.

 

The Budget 2022

The Budget 2022 was announced on Tuesday, 12 October 2021. Some of the employment-related highlights are:

Income tax: the rate of income tax will stay the same, but the standard rate income tax band (the amount an employee can earn before they start to pay the higher rate of tax) will be increased by €1,500 for 2022;

 

Employer’s PRSI: the weekly income threshold for the higher rate of employer’s PRSI will increase from €398 to €410;

 

Minimum wage: the NMW will increase by €0.30 to €10.50 per hour from 1 January 2022;

Leave for parents: Parent’s Leave and Parent’s Benefit will be extended by 2 weeks to 7 weeks from July 2022;

Remote working tax relief: there will be income tax relief of 30% on heating, electricity and broadband expenses;

Employment Wage Subsidy Scheme (EWSS) changes: the EWSS will remain in place in a graduated form until 30 April 2022. There will be no change to EWSS for the months of October and November, but changes will start to apply from December. The scheme will also close to new employers from 1 January 2022.

 

 

What’s on the horizon?

 

Gender Pay Gap Reporting

 

The Gender Pay Gap Information Act 2021 was signed into law in July 2021. The Act requires public and private sector organisations (initially those with 250+ employees, but extending over time to organisations with 50+ employees) to analyse, explain and publish certain information on pay differences between male and female employees and information on any measures taken (or proposed to be taken) to eliminate or reduce such differences.

The Regulations bringing the legislation into force are expected any day now and it is anticipated the reporting process will begin early next year. We await the Regulations for the specific details.