REDUNDANCY PAYMENTS ACTS, 1967 TO 2014
(REPRESENTED BY DOROTHY DONOVAN B.L.)
- AND -
(REPRESENTED BY JR KEENAN)
1.An appeal of an Adjudication Officer's Decision No(s)ADJ-00020568 CA-00027130-001
The Complainant commenced employment on the 27thJanuary 2015 as a bartender with the Towey Hotel & Bar Group in what was then ‘The Arc Bar & Restaurant’ in Liffey Valley, Dublin 22. In 2017 the Complainant’s employment was transferred to the Respondent under a transfer of undertakings. He continued working in the role of bartender in the venue which operated under the name ‘The Elms’.
On the 27thDecember 2018 the Complainant received a letter from the Respondent advising that from Sunday the 30thDecember 2018 they were closing the premises on a temporary basis. The need to close arose because the Respondent was experiencing difficulty in getting insurance for the premises and could not operate without same.
The Complainant was informed that he would be placed on temporary layoff for four months with effect from 31/12/2018 and that the period might be extended. Enclosed with the letter, was an RP9 form which indicated that the temporary lay of was effective from 31/12/2018. At the time of the Labour Court hearing 25th November 2020 the venue remained closed.
The Complainant by email dated 28th January 2019 was offered a position in the Harbour Master Bar Dublin 1 commencing on the 4thFebruary 2019. The email stated that he was being offered the position on his existing terms and conditions but there would be an amendment to his contract which would now show his normal place of work as being the Harbour Masters Bar.
The email went on to say that the transfer would be until such time as the Elms reopened and that it was hoped it would reopen in three months. The Complainant responded by email of the 8thFebruary 2019 declining the job in the Harbour Masters on the basis, that such a transfer would cause him to incur additional travel expense and an increase in his travel time.
The Complainant in that email raised with the Respondent the fact that he was aware the ‘Elms’ premises was up for letting and that appeared to contradict what was set out on the RP9 form. The Complainant advised the Respondent that he now intended to claim redundancy as it was clear to him that his role in the Elms was now gone.
On the 11thFebruary 2019 the Respondent sent a letter to all staff setting out that they were still seeking to secure public liability insurance. The letter indicated that they were also looking at other alternatives such as transferring the lease to a body that could obtain the required insurance.
The letter went on to inform the employees that the temporary closure might extend beyond the original four months envisaged. The letter indicated that the Respondent was also looking at temporary and or permanent transfers to enable the employees return to work.
On the 13thFebruary 2019 the Complainant received a response to his email of 8thFebruary 2019 noting his concerns in respect of the proposed transfer to the Harbour Master Bar. The letter stated that the Respondent was looking at possible solutions to the issues the Complainant had raised.
Later the same day 13thFebruary 2019 the Respondent wrote to the Complainant in respect of the proposed transfer to the Harbour Master Bar offering a permanent move. The letter indicated that if he was to accept a permanent transfer to the Harbour Master Bar a distance of 12.6 km from his previous employment then the Respondent was prepared to make a single payment of €500 gross and to give him aone-4-allgift voucher to the value of €500.The Complainant by email of the same date 13thFebruary 2019 advised the Respondent that he had completed RP9 section B and was claiming statutory redundancy with effect from 22ndFebruary 2019.
The Respondent by email and registered post on the 19thFebruary 2019 wrote to the Complainant acknowledging that RP9 part B had been served on the company on 14 February 2019. The Respondent returned the RP9 form with part C completed on the 18thFebruary 2019.
In the attached letter the Respondent set out that they were in a position to offer him employment with effect from week starting 4thMarch 2019 for a period of no less than thirteen consecutive weeks on his existing terms and conditions of employment. The only change would be his place of work which would change from The Elms in Liffey Valley, to the Harbour Master Bar in Dublin 1.
The letter stated that his temporary layoff which commenced on Monday 31stDecember 2018 would end with the last day of layoff being the 3rdMarch 2019. The letter also noted that in line with section three of his contract which he had signed on 1stJune 2017 his normal place of work was being transferred to the Harbour Master Bar with effect from 4thMarch 2019.
On the 20thFebruary 2019 by email the Complainant advised that for reasons previously stated he was not in a position to transfer his employment to the Harbour Master Bar and that he now firmly believed that the lay-off was not temporary in nature .The Complainant informed the Respondent that he intended to submit an RP50 form to advance his claim for redundancy payment.
On the 22ndFebruary 2019 the Respondent issued a letter to all staff giving an update in respect of the Elms, including the fact that there had been a sewage leak which had caused significant damage to fixture and fittings on the premises. The impact of this meant that the temporary closure would now need to be extended by at least a further two months with a targeted opening date of sometime in July 2019.
On the 23rdFebruary 2019 the Respondent acknowledged receipt of the Complainants email of 20thFebruary 2019. In their response they set out the steps the Respondent had and were taking to resolve the situation. The Respondent re-affirmed that a redundancy situation did not exist and confirmed that there was a post in the Harbour Masters Bar available for him. The letter went on to say”the company requires confirmation within 7 days and no later than 18.00 on Saturday 2ndMarch 2019 that you either;
Accept the offer of re-deployment made on 13thFebruary 2019(including once off payments and returning a signed and dates copy of the amendment supplied with the offer),or
Accept the offer of continued employment made on the 19thFebruary 2019 as set out in your existing terms and conditions of employment on the return of your RP9 part c or,
Decline both offers of continued employment and remain on temporary layoff”
On the 25thFebruary 2019 the complainant sent a letter confirming his claim for redundancy and enclosing a form RP77. By registered post the Respondent sent a letter on the 1st March 2019 returning the form RP77 and advising that a post was available for the Complainant in the Harbour Master Bar and if he did not take up that post he would remain on temporary layoff until the Elms reopened.
The above factual matrix was accepted by both parties. The parties also agreed that the Complainant met the requirements set out in section 4 of the Act in that he had the requisite service and was employed in an employment which is insurable for all benefits under the Social Welfare (Consolidation) Act 2005.
In addition to relying on the provisions of the Act the Respondent also sought to rely on a clause in the employment contract which stated “Your normal place of work will be The Elms. You might be required to work at other Sean Doyle Group locations or temporary venues as temporary transfers or as part of normal duties. You may be transferred ,through instruction, without amendment to your terms of employment.”The Respondent confirmed to the Court that it had two venues in Dublin and three outside Dublin.
It was the Respondent’s submission that the contract contained a term that said if a Worker was transferred to another location or venue they could after four weeks in the new location request to be transferred back. The Court could not locate such a term in the contract provided to the Court by the Respondent. It was the Respondent’s submission that the clause in a general way was enforceable, but they accepted it could fall foul of the general legal principles around mobility clauses.
The Complainant submitted that the clause was too vague and to wide and therefore could not be relied on. If the clause was found to be valid it would mean that an employee could be transferred on instruction to work in another county without any engagement with the employee or consideration of the impact of such a move on the employee.
Both parties sought to rely on theKellog Brown &Root (UK) LTD v (1)Fitton and (2)Ewer (Appeal no. UKEAT/0206/16/BAcase where the employer had sought to rely on a mobility clause when deciding to close one of its office. In that case the tribunal deemed the instruction to move to be unreasonable and held that the mobility clause was overly broad and lacked certainty. The Tribunal set out a number of considerations that should be taken into account by an Employer seeking to rely on a mobility clause in the contract.
Parties Evidence to the Court
In order to place staff on lay-off section 11 of the Act requires that “it is reasonable in the circumstances for the Employer to believe that the cessation of work will not be permanent.”
The Complainant submitted that prior to the closure the heating system had broken down and not been replaced this led to a drop off in customers. It was also submitted that the crockery was not replaced and security on the door was ceased. The Complainant also pointed out that Google maps at the time showed that the ‘Elms’ was permanently closed. The Complainant submitted that this all pointed to an intention on the Respondent’s part to run the business down and then close it.
The Respondent submitted that the closure arose from the difficulty in acquiring public liability insurance at that point in time . Their broker advised them that a number of possible claims that had been identified would be statute barred over the next few months and that should resolve the issue for them . These were not actual claims that were in being but potential claims. Mr Doyle one of the Directors of the Respondent in his evidence to the Court advised that they had taken over the business in 2017, at that time some but not all outstanding claims had been disclosed.
While they had managed to get insurance in 2018 it became an issue for 2019. They had tried a number of insurance companies including some based in England but without success. Mr Doyle drew the Courts attention to a letter from their broker dated 21stDecember 2018 which advised that “we approached all our Domestic and London Markets with the Risk and unfortunately due to the historical claims experience we have been unable to obtain a quotation”.Mr Doyle submitted that in respect of the crockery he was not aware of any decision not to replace same, that would be at the discretion of the manager.
He acknowledged that the heating system had failed in October 2018 and that they had installed temporary heaters, but it was his evidence that this did not impact on their customer numbers and there was no reduction in takings during that period. In respect of the removal of the security guard from the door it was his evidence that they were changing the nature of the business away from being bar oriented to a family bar and restaurant and therefore, security was not required. Mr Doyle is his evidence informed the Court that the Respondent had made substantial investment in the property since it had acquired it .
Mr Kelliher the Group Safety Advisor for the Respondent, in his evidence submitted that the Security Officer was no longer required. Having a security presence, it was only ever a temporary arrangement that had been put in place arising from a specific incident. In respect of the heating system it was his evidence that repairing the heating system would be a big job.
The Respondent had been advised that there was difficulty getting parts because the system was old and that they would be better getting a new system. The work on the heating needed to be done on the roof and it was felt that it would be more appropriate to do it in the New Year. In respect of the social media concerns the ‘Elms’ website did not say it was closed and the Respondent had not engaged with Google in respect of what was on Google maps.
It is not disputed that the Complainant was offered a transfer to the Harbour Masters Bar Dublin 1 on his existing terms and conditions. The Complainant in his evidence to the Court informed the Court that he lived about two km from the Elms Pub and that he could walk or drive to work in a matter of minutes. There was also free carparking available. His normal shifts were 10am to 6pm or 6pm to 12 or 2.30am if there was late opening. He worked 5/7 days and earned between €320 and €340 a week.
If he moved to the Harbour Master Bar it could take up to 50 min to drive in and carparking would cost €15 a day. The other option he looked at was driving to Bluebell in Inchicore and getting the Luas. The Luas takes 45 to 50 minutes plus the time to drive from where he lives to Bluebell. It was his evidence that either way he was looking at an additional two hours a day commute and either parking or Luas charges. On the days he was on late shift the Luas would not be an option so he would have to drive and pay carparking charges.
It was the Complainant’s evidence when he weighted everything up it was not practical or cost effective for him to avail of the transfer particularly with the low wage he was on. He accepted that the Respondent had made an offer of €500 plus a €500 voucher. However, if he made the move, he would sustain the cost of the commute in time and money on an ongoing basis this would have a direct impact on his disposable income and on his low income he could not afford it.
The Redundancy Payments Act 1967 states as follows;
(1) Where [ … ] 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—
Discussion and Decision
It is clear to the Court from the submissions made prior to and during the hearing and the exchange of letters commencing on the 19thFebruary 2019 up to and including the 25thFebruary 2019 that while the Respondent raised the issue of the clause in the contract, they never actually sought to enforce it. An instruction to comply with same was not issued, instead it was listed as one of three options from which the Complainant could choose as contained in the letter of the 23rdof March 2019 and re-iterated in letter of 1stMarch 2019. Therefore, the Court does not need to consider this issue further.
The Court having considered the submissions and the evidence of the parties in respect of section 11 of the Act finds on the balance of probabilities that at the time off the layoff it was reasonable for the Respondent to believe that the cessation of employment would not be permanent.
It was accepted by both parties that the requirements under sections 12 and 13 of the Act in respect of the serving of notice and counter notice were met. In those circumstances the issue that remains to be considered by the Court is whether in line with section 15 of the Act the refusal by the Complainant to accept the offer of alternative work in a different location was unreasonable.
In determining the final aspect of the within appeal, the Court is required to consider two issues: (i) the suitability of the offer of alternative employment made by the Respondent to the Complainant; and (ii) whether the Complainant’s decision to refuse such an offer was reasonable in all the circumstances. InCambridge & District Co-operative Society Ltd v Ruse I.R.L.R. 156 the English EAT, when considering the similarly worded provisions of the British legislation, said, at page 158, that the question of “the suitability of the employment is an objective matter, whereas the reasonableness of the employee's refusal depends on factors personal to him and is a subjective matter to be considered from the employee's point of view”.
The Court accepts that the Respondent acted at all times in a bone fide manner in their attempts to retain the Complainant in the Respondent’s employment by endeavouring to offer an element of compensation for the inconvenience of transferring to a new location. To that extent, the Court determines that the Respondent, from an objective perspective, satisfies the first leg of the test set out by the English EAT inCambridge.
However, having considered the Complainant’s evidence, the Court is equally of the view that the change involved in moving from working in Liffey Valley where the Complainant could get to and from work in a matters of minutes with no additional costs, to working in a city centre location with the additional commute times, related costs and the difficulty of getting home after his late shifts when public transport would not be available, is a change of such magnitude, when considered from the Complainant’s subjective perspective, that the Court has to find that his refusal to accept the move to the Harbour Master Bar was not unreasonable.
There was no job available for the Complainant in his established place of work. The alternative offered to him would have necessitated an unreasonable additional daily commute and costs for him. In all the circumstances, the Court, therefore, finds that the Complainant is entitled to a statutory redundancy payment based on the following criteria:
Enquiries concerning this Determination should be addressed to David Campbell, Court Secretary.