ADJUDICATION OFFICER DECISION
Adjudication Reference: ADJ-00028563
Parties:
| Complainant | Respondent |
Parties | Joanna Sandhu | Alkimii Limited |
Representatives | Richard Grogan Richard Grogan & Associates | Peter Woodcock Woodcock Solicitors |
Complaint(s):
Act | Complaint/Dispute Reference No. | Date of Receipt |
Complaint seeking adjudication by the Workplace Relations Commission under section 7 of the Terms of Employment (Information) Act, 1994 | CA-00036608-001 | 08/06/2020 |
Complaint seeking adjudication by the Workplace Relations Commission under section 77 of the Employment Equality Act, 1998 | CA-00036608-002 | 08/06/2020 |
Date of Adjudication Hearing: 07/05/2021
Workplace Relations Commission Adjudication Officer: Janet Hughes
Procedure:
In accordance with Section 41 of the Workplace Relations Act, 2015 and Section 79 of the Employment Equality Acts, 1998 - 2015, following the referral of the complaint(s) to me by the Director General, I inquired into the complaint(s) and gave the parties an opportunity to be heard by me and to present to me any evidence relevant to the complaint(s).
Background:
There are two complaints for decision. The first refers to an alleged breach of the Terms and Conditions of Employment Act 1994. The alleged breach originally submitted to the WRC was a failure to provide a statement of terms of employment. A statement signed by the Complainant was provided by the Respondent. At the hearing that the Complainant had received statement was no longer disputed. The grounds of the complaint as set out at the hearing were : a failure to provide a pay reference period related to the provisions of the Minimum Notice and Terms of Employment Act and the inclusion of an annual leave year of 1 January to 31 December contrary to the provisions of the Organisation of Working Time Act which provides that the annual leave year for the purposes of the Act is 1 April in a given year to 31 March in the following year.
The second complaint is concerned with alleged discrimination under the Employment Equality Act based on the dismissal of an employee allegedly on grounds of redundancy while she was pregnant, and it was known to the Respondent that she was pregnant at the time of her dismissal.
The Complainant was employed as an operations manager on the installation team in the employment from the 11th of June 2019 until she was made redundant on the 26th of May 2020 with one week’s pay in lieu of notice. The salary of the Complainant was €50,000 per annum with a company car.
Note: The hearing took place following the Supreme Court decision in what has become known as the “Zalewski” case.
The parties were informed and appeared aware of the fact that the hearing was in public and that the decision may be published inclusive of the names of the parties. The fact that an oath could not be administered was advised to the parties and it was agreed that the nature of the issues allowed the hearing to proceed without concerns around the absence of the administration of an oath or a question of serious conflict arising which would require the hearing to be adjourned to allow for the administration of an oath. At the conclusion of the hearing the parties stated that they were satisfied that all of the issues that they wished to raise and the arguments to be considered were fully heard. One person, Witness A, gave evidence on behalf of the Respondent and was questioned by his own representative, the representative of the Complainant and the Adjudication Officer.
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Summary of Complainant’s Case:
Terms of Employment (Information) Act The Complainant acknowledges that she received a statement of terms and conditions of employment. It is submitted that the omission of a reference period for the purposes of the Minimum Notice and Terms of Employment Act was a breach of the requirements under the Act of 1994. It was submitted that the inclusion of a holiday year from 1 January to 31 December was not in compliance with the Organisation of Working Time Act. Act of 1994. Compensation was sought by way of redress.
Employment Equality Act 1998 to 2016
In February 2020 the Complainant informed her employer that she was pregnant. On the 26th of May 2020 the Employee received a telephone call informing her that she was being made redundant. The phone call was followed on the 26th of May by a letter of the same date stating that the Employee was being made redundant. There was no prior consultation, no documentation provided to her relating to the selection process, and it was submitted that there was no opportunity to defend herself or to put forward alternatives. Of the 20 employees only two were made redundant. The complaint is that the Employee was discriminated against by reason of her gender and family status in being dismissed from her employment while pregnant. Section 6(1)(a), 6(2)(a) and section 6(2)(c) were cited in support of the interpretation of the legislation that it very specifically prohibits “such unlawful behaviour”. The statement of terms of employment or any other document did not contain a gender equality clause required by virtue of section 21. Nevertheless, in accordance with section 30 of the Act a “non-discriminatory equality clause” is taken to be included in any contract of employment. The following case law was cited in support of the contention that “The protection of pregnant women from such discrimination in the workplace is well settled authority in both Irish and European law”:
O’Brien v Persian Properties t/a O’Callaghan Hotels DEC-E2012-010, [2012] ELR 211.
Council Directive 92/85/EEC Pregnancy Directive [1992] OJL 348/1 was cited where it states that an employer is required to cite “duly substantiated grounds in writing” where a pregnant worker is dismissed. This was never afforded to the Complainant, “despite repeated requests”.
The case of Assico Assembly -v- Corcoran EED033/2003 was cited.
Also cited was Lee t/a Peking House v Fox ED/01/53.
Regarding the burden of proof, it was submitted that it is well established that the existence of pregnancy itself is sufficient to shift the burden of proof to the employer to prove that the dismissal of a pregnant employee was not on grounds of pregnancy. The Claimant has established that she is covered by the protected gender and family status ground. She is relying on the case of Ntoko -v- Citibank [2004] 15 ELR 116 for the use of a hypothetical comparator. The Claimant submits that she was discriminated against by reason of her gender and family status in being dismissed while pregnant. The Claimant has very clearly established a set of facts from which discrimination can be inferred and, accordingly, she has discharged her burden of proof pursuant to section 85A of the Employment Equality Acts. The Claimant relies on the Labour Court decisions of Hallinan -v- Moy Valley Resources DEC-S2008-025 and Cork City Council -v- McCarthy EDAO821 in this regard. In the Hallinan case, the Labour Court set out that a claimant meeting the burden of proof must establish (i) that he or she is covered by the protected ground; (ii) establish the specific treatment has allegedly taken place; and (iii) that the treatment was less favourable than was or would be afforded to a person not covered by the relevant discriminatory ground.
In the case of Cork City Council, the Labour Court held that the claimant must be able to establish the primary facts upon which he or she relies but also that they are of sufficient significance to raise an inference of discrimination. The submission concluded that the Claimant has discharged her burden of proof and that it was a matter for the Respondent to establish and prove non-discriminatory reasons for the dismissal of the Claimant while she was pregnant. The onus on the Employer in this regard was cited through Portroe Stevedores -v- Nevins [2005] ELR 282 and Trailer Care Holdings Limited -v- Healy EDA128. Redress was sought by way of compensation asking that the following points be considered: Von Colson and Kamann -v- Land Nordrhein - Westfalen [1984] ECR 1891 (commonly known as Von Colson) which provides for compensation for economic loss and a real deterrent against future infractions. Precedent decisions providing for compensation in cases where it was found to have been a pregnancy related dismissal were cited. Decisions of adjudication officers in the WRC were cited as ADJ-000161341[sic] and ADJ-00019652 in which the case of Eleanor O’Higgins -v- UCD [2013] 24 ELR 146 EDA131 based on the Labour Court principles applied in that case.
In terms of impact, the submission referred to the danger to mother and baby of a decision to dismiss a woman during pregnancy and continued:
“The Claimant’s dismissal has weighed on her. She is 20 years of age and expecting her first baby. She felt embarrassed by being dismissed from her employment. She has worried and been anxious and stressed about not having an income for the duration of her pregnancy and for when after her baby is born. She was obliged to attend her GP following panic attacks as she was concerned that the stress and anxiety was harming her baby.”
It was submitted that the dangers which a termination of employment can cause to both mother and baby was reflected in the decision of Danosa [2011] 2 CMLR 45 which refers to Article 10 of Directive 92/85, in which the EU legislator provided for “special protection for women, by prohibiting dismissal during the period from the beginning of the pregnancy to the end of her maternity leave.”
A submission was made on legal costs/legal aid by reference to Case C-684/16, Art. 47 of the Charter of Fundamental Rights of the European Union page 266A, Case C-378/17 and Case C-14/83 together with decisions of the ECJ as forming a basis for either an entitlement to legal aid or in the alternative to set out in addition to the award which must be proportionate and dissuasive the element of costs incurred by the employee.
Finally, the decision DEC-E2008-00 Fagan -v- The Office of Revenue Commissioners which was quoted with approval in Case ADJ-00016512 was referenced.
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Summary of Respondent’s Case:
Terms of Employment (Information) Act The grounds for a complaint were heard for the first time at the hearing. Responding to complaints as set out the Respondent replied as follows:
· Given that the rate of pay for the Complainant was €50,000 per annum, the inclusion of a clause comprehending the national minimum wage reference period was irrelevant in her case;
· It may be that the annual leave year set out in the Organisation of Working Time Act is April of one year to March of the following year. However, the Complainant received her annual leave entitlements in full and suffered no loss as a consequence.
Employment Equality Act 1998 to 2016
The Respondent gave details of the nature of the operation. It is a cloud-based software system company whose products are designed for hotels. Details of the service which is provided which is a “payroll management application” were set out including the role of the customer success team and the implementation team in delivering and installing and training for the product. Two employees, the Complainant and another known as FC, were responsible for gathering the information from new customers (hotels) and then they were required to set the new hotels up with their chosen payroll management applications. Then they would begin to configure that application to reflect the particular hotel. They would then visit the hotel premises or property to train staff on site. Their role involved visiting customer locations for product demonstrations and training. The difficulties experienced by the Respondent in 2020 and which led to a decision to implement redundancies were directly related to the impact of Covid-19. As set out in the submission:
“With the hotels closing, no existing customers were upgrading to Team Pro and there were no prospective customers due to come on board because they were either reducing their teams on a large scale or closing for business, therefore not requiring an application to onboard new employees. Any planned installations that were booked, were all cancelled. The Respondent company also did not envision existing customers planning on upgrading their existing Team Applications for the foreseeable future due to cost.”
Mr A gave a detailed account of the impact of Covid on the business. He gave details of the revenue versus expenditure of the business and described how that business “hit the rocks” with effect from the 13th of March 2020. Describing how temporary employees were laid off, others were placed on short-term work and the Complainant was one of those who were laid off. There were contacts with the team regarding her car, BIK and related tax issues. Revenue fell from Revenue fell from €64k per month down to €19k while payroll was standing at €100k per month. The Complainant was checking in with the business in the month of April but there were zero instalments and there was nothing definite about how long Government support would last for a business such as theirs. In summary, income was running at less than expenditure. Installations were not happening. It became necessary to look at the future of the business and it was decided that they were not going to survive if they continued as they were. It was decided that they needed to implement redundancies. The fact that the Complainant was pregnant was noted at the time when considering who was to be made redundant and a final decision was taken on the 21st of May. The situation was exceptional, and this was why she was made redundant in anticipation of a situation where there would not be installations at any time in the near future and this has transpired to be the case following further shutdowns of the hotel business and restrictions in 2020/2021.
The Respondent took professional HR external advice, they carried out a skills analysis of employees versus those required to maintain the business and based on that assessment which was set out in a matrix form with calculations of the competencies of all the employees concerned, a decision was taken to make the two installation employees redundant including the Complainant. Regarding a consultation process, the external advice was that such a process was not required in this case. On the principles regarding the legislation, the legal submissions on behalf of the Respondent were set out. The Claimant is required under the Employment Equality Act, to establish a clear basis of a prima facie case and has not done so. The redundancy was a result of the Covid-19 crisis, the cessation of “installs” into customer hotels which led to the closing down of the Installation Team and the redundancy of two female employees, rather than any other factor alleged or at all. The circumstances which led to the two redundancies in the Irish Operation were due to exceptional circumstances-Covid - 19 and its effect on the business. The said two employees were emailed on 25/5/20 setting up individual virtual meetings on 26/5/20 where a full explanation of the decision was given to the employees and the explanation for same was put in writing thereafter. The Complainant has not established that her pregnancy was a determining factor in her selection for redundancy.
Referencing ADJ-00019652 and the test set out by that Adjudication Officer related to the Eleanor O’Higgins case and the principles set out, the Claimant cannot establish she fits into these principles in circumstances where she cannot show an inference of discrimination (where both employees were made redundant were female) or any range of presumptions as discrimination is not the most likely explanation or is plausible at all.
The EE Acts very specifically provides for a lawful behaviour (redundancy) in “the most exceptional circumstances not connected with the condition of pregnancy” and it is contended that exceptional circumstances existed in this case in circumstances where the redundancy was a result of (i) the Covid-19 crisis and (ii) the total loss of the Respondent company customer (installations) and (iii) the lawful decision to close down the Installation Team, rather than any other factor alleged or at all; and (i) there is no suggestion of the Claimant’s pregnancy having any impact on the redundancy decision (ii) all (both) of the Installation Team employees were made redundant (iii) all (both) were female, and she was not treated less favourably than any other employee (member of the Installation Team). A definition of exceptional was also supplied.
The Respondent denied any breach of section 6(1) or 6(2) of the Employment Equality Act as “there is no discrimination on the gender ground; no decision was made by the Respondent on a ground related to her pregnancy” and the Complainant was not “treated less favourably than another employee is, has been or would be treated”. The Respondent referenced case law cited by the Respondent of O’Brien v Persian Properties, the Council Directive, Assico Assembly -v- Corcoran and provided a different interpretation to be given to those precedent cases as they did also with Lee t/a Peaking House -v- Fox. The grounds set out for the redundancy was that of the 26th of May 2020 in the letter to the Complainant “The business is now challenged due to the Covid-19 crisis”. Citing the Hallinan case, the Respondent’s representative concluded:
“The Claimant has not discharged her burden of proof. Therefore, it is not for the Respondent to establish and prove non-discriminatory reasons for the dismissal of the Claimant while she was pregnant. It is further submitted that the rebuttal evidence does show a degree of cogency as per the Labour Court determination in Portroe Stevedores -v- Nevins [2005] ELR 282 in circumstances where the Claimant is unable to establish any “less favourable” or “inference of discrimination” where all (both) the Installation Team members were made redundant and all (both) were female. As the Respondent has rebutted any prima facie inference of discrimination the Claimant is not entitled to seek redress in compensation for the redundancy made.”
In oral submission, the Respondent’s representative contended that if the case set out on behalf of the Complainant was accepted then it could never be the case that a pregnant woman could be (lawfully) made redundant or have their employment terminated while pregnant. This would mean that only those who were not pregnant could be made redundant.
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Findings:
Terms of Employment Information Act 1997. It is a matter of fact that the Respondent did not include the required references to the Minimum Wage Act as required by section 3 of the Terms of Employment Act 1994 as amended. In circumstances where the Complainant was in receipt of salary so far in excess of the effective application of the Minimum Wage Act in her employment compensation of any significance is not justified by this omission. Similarly, the fact is that the Organisation of Working Time Act 1997 provides for only one annual leave year i.e. April in one year to the end of March of the following year. However, there is no issue to be determined arising from the inclusion of a different annual leave year in the statement of terms of employment. Allowing that it is not necessary for a complainant to be adversely affected by the omission or variation of a specific term to be entitled to compensation and taking into account the modest amounts of compensation provided by under the legislation even where the breaches do have an adverse effect, the sum of €100 compensation is considered adequate to the circumstances of this case. Employment Equality Act 1998 to 2016 Much was made by the representatives of the parties of the arguments around a ‘prima facie’ case and the case law around that point. The fact is that the Respondent conducted a selection process entirely hidden from the Complainant, one which determined who was and who was not suitable for retention in the employment-not only based on their role as installers but across an entire skill set. Given that the Complainant was pregnant and that the Unfair Dismissals Act cites pregnancy as a specific ground of unfair dismissal, even where that employee has less that one year’s service, that an employer, or their advisor, would consider it anything other than mandatory to consult the employee who was pregnant is quite concerning. It is not as thought the Respondent was not aware of the fact when putting together their matrix-they specifically referred to the fact of the Complainants pregnancy when making their decision: Although we considered that Joanne is pregnant, the only two employees that we can make redundant are Joanne and xx’. Where a selection process was conducted in secret, knowing that the employee was pregnant and actually confirming that they took that fact into account-the Respondent in this instance has a very weak case with which to defend themselves against this claim. To put it another way, how can the Complainant be satisfied that her pregnancy was not a factor in her selection when she was excluded from the selection process and became aware of it only after she submitted her complaint to the WRC. She received no right of appeal of the decision. The letter of dismissal says nothing about a selection process or that a range of jobs and skill were considered in arriving at the decision. That letter of May 26th refers only to the effects f Covid-19 on the business: ‘Further to our call on 26th May 2020, I am writing to inform/confirm you of my decision.’ Unfortunately, the expected level of trade throughout the year for our business is now challenged due to the Covid-19 crisis. I am sorry to have to inform that we have no alternative but to make you redundant.’ No mention made of other alternatives that were considered or, if the matrix is to be accepted as a genuine reflection of a real process of selection which had occurred, the grounds on which the selection was made-other than Covid. Thus, the Respondent failed to provide the Complainant of the grounds of her personal selection and cannot rely on the requirement as contained in the Directive at Article 10 2. Which requires that an employer dismissing a pregnant woman ‘must cite substantial grounds for her dismissal’ I will say that wishing a pregnant woman ‘well’ when dismissing her at a time when unemployment was rampant, and the country was largely in lockdown, including the industry to which she was attached, was perfunctory to say the least. And this observation is related to the evidence of the Respondents witness at the hearing. The thrust of his evidence was that there was no way of knowing whether State supports would continue or for how long and their business decision-that sales would not be restored in the foreseeable future rendered the circumstances exceptional thus justifying the dismissal of a pregnant employee. While Covid -19 is an exceptional circumstance in over 100 years-so too are the supports which have been provided to employers whose business has been adversely affected, including those completely closed since March 2020. The concept of PUP and Wage subsidies, and other supports are understood to have been introduced at great expense for the very reason of avoiding mass redundancies and to allow workers to be maintained in employment and businesses to survive albeit on much reduced circumstances in many instances. Indeed, employees were not permitted to seek statutory redundancy for the very reason that the supports were there and not to encourage job hopping potentially at the expense of the State-or this is also a reasonable working assumption. The Complainant was on lay off-like tens of thousands of other employees in the hospitality sector-many of whom had not returned to their place of employment at the time of the hearing and for whom the reduction of supports will only come into force in the future. There may well have been a business decision which proved to be prophetic, but it is not accepted that there were exceptional reasons for making the complainant pregnant in May 2020 such as allow the Respondent to rely on the ‘exceptional’ section of Article 10 Section 1 of Directive 95/85/EEC as claimed. Having failed to meet the test required of providing the actual grounds for the selection of dismissal to the Complainant , having failed to consult her regarding the process followed but not referenced in the letter of dismissal; having failed to meet the requirement to provide substantial grounds or exceptional grounds to a pregnant employee; having failed to provide an appeal process and having made their decision conscious of and including the reference to her pregnancy as part of the decision making, the Respondent has nothing on which to defend the complaint of discrimination and to shift the burden of proof back to the Complainant. She is entitled to succeed in her case that there is at least an inference that her pregnancy was a factor in deciding that she was to be dismissed or at the very least that no valid grounds existed for her dismissal at that time by reference to the legislative protections provided for pregnant women. This conclusion is sufficient for the complaint of discrimination to succeed. Regarding redress, the situation is complicated by the fact that the Complainant was on lay off at the time of her dismissal and therefore the usual basis for calculation of loss by reference to a weekly wage does not exist in the usual way, I have decided to apply the terms of Section 82 (4)(a)(iii) which allows for a greater amount of compensation and where I am obliged to select the greatest of the available specified three options- which in this case is €40000. On the matter of costs as claimed by the Respondent solicitor, while I could argue the requirement for costs and the implications of such a provision, or at least put forward a different perspective, as I have no authority to award costs, and no influence on such matters, there is little point in my joining the debate on this subject. |
Decision:
Section 41 of the Workplace Relations Act 2015 requires that I make a decision in relation to the complaint(s) in accordance with the relevant redress provisions under Schedule 6 of that Act.
Section 79 of the Employment Equality Acts, 1998 – 2015 requires that I make a decision in relation to the complaint in accordance with the relevant redress provisions under section 82 of the Act.
Terms of Employment Act 1994-CA -00036608-001 This complaint is well-founded in that there was an omission for the statement of terms in relation to the Minimum Wage Act and also the annual leave year cited differs from that in the Organisation of Working Time Act. An amount of €100 is to be paid by the Respondent in compensation. Employment Equality Act 1998-2015-CA-00036608-002 The complaint of discrimination on grounds of pregnancy brought by Joanna Sandhu is well founded. Alkimii Ltd. are to pay her the sum of €40000 in compensation. |
Dated: 14th July 2021
Workplace Relations Commission Adjudication Officer: Janet Hughes
Key Words:
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