ADJUDICATION OFFICER DECISION
Adjudication Reference: ADJ-00029964
Exela Technologies Limited
Frank Drumm BL
Cian Conboy, IBEC
Complaint Reference No.
Date of Receipt
Complaint seeking adjudication by the Workplace Relations Commission under Section 8 of the Unfair Dismissals Act, 1977
Date of Adjudication Hearing: 28/02/2022
Workplace Relations Commission Adjudication Officer: Catherine Byrne
In accordance with section 8 of the Unfair Dismissals Acts 1977 - 2015, this complaint was assigned to me by the Director General. Although it was submitted to the WRC on October 12th 2020, due to restrictions during the Covid-19 pandemic, a hearing was delayed until January 10th 2022. A remote hearing took place on that day, at which I made enquiries and gave the parties an opportunity to be heard and to present evidence relevant to the complaint. The hearing resumed and was concluded on February 28th 2022.
The complainant, Ms Branagan, was represented by Mr Frank Drumm BL, instructed by Mr Finian Finn, of Denis I Finn, Solicitors. Exela Technologies Limited was represented by Mr Cian Conboy of IBEC. The HR director of Exela Technologies, Ms Kim Morton, gave evidence on their behalf, as did Ms Louise Swan, the quality lead for the respondent in the United Kingdom. The HR manager for the Irish business, Ms Aisling Kelly also attended the hearing.
While the parties are named in this decision, for the remainder of this document, I will refer to Ms Branagan as “the complainant” and to Exela Technologies Limited as “the respondent.”
I wish to apologise to the parties for the delay issuing this decision and for any inconvenience that this has caused.
The complainant was employed by Allied Irish bank from March 1979 as a senior bank official and she transferred to the respondent, which was then known as Banktec, on March 1st 2014. The company is engaged in business process automation and they provide financial transaction services, interbank settlements, data capture services, digitisation and data aggregation services to financial institutions. The complainant was a processing clerk in the Quality Department and when her role was made redundant in September 2020, her annual salary was €57,225. She claims that the termination of her employment due to redundancy was unfair.
It is the respondent’s case that the complainant was fairly selected for redundancy and that she showed no interested in an alternative role that was identified. The respondent’s position is that the complainant was afforded the right to fair procedures and that her dismissal was not unfair.
Summary of Respondent’s Case:
Background to the Redundancy of the Complainant’s Role
In a submission provided in advance of the hearing, Mr Conboy said that, as a result of the cessation of some client work and the general decline in business during 2020, the respondent had to “right size” their business and to review overlaps in their services. In the context of operations, business needs and overall savings, the Operational Excellence (“OpEx”) team was restructured across the UK and Ireland sites. This resulted in the redundancy of 107 jobs in the UK and 27 jobs in Ireland.
The OpEx team in Dublin consisted of a line manager and two team members, one of whom was the complainant. At a meeting on August 7th 2020, the complainant and her colleague, who I will refer to as “Mary,” were advised that both their jobs would be made redundant. This was confirmed by letter to the complainant on the same day. She was informed that she could apply for any suitable alternative role that might be available and that the consultation period would end on August 21st.
Mary and the complainant requested details of their potential redundancy payment and this information was provided on August 10th 2020. Based on her combined service with AIB and Exela Technologies of 41.5 years, the complainant was entitled to a statutory redundancy payment of €50,640.
On August 11th, the complainant was advised that there were no jobs available in Operations for which she could apply. On August 19th, she and Mary were advised of the possibility that two part-time roles might be coming up on a different team, the Payments and Investigations Team. These arose because two part-time employees indicated that they were interested in applying for redundancy. The following day, the complainant was provided with details of the hours and pay for the jobs that might become vacant. Both roles were for 22.5 hours per weeks. One was a team lead, on a salary of €27,550 and the second was a processing clerk on a salary of €21,000.
On August 24th, Mary and the complainant were advised of a change of plan regarding the redundancy of their jobs. They were informed that an OpEx job in the UK would be made redundant and one of their jobs in Dublin would be retained. To decide which job was to become redundant, a selection matrix was drawn up by Ms Louise Swan, the quality lead for Europe, Middle East and Asia (EMEA). Ms Swan concluded that Mary was a full match for the requirements of the job that remained in Dublin. The complainant asked if the only alternative to avoid redundancy was if she accepted one of the part-time roles in the Payments and Investigations Team. On August 26th, the HR director informed her that, if she was interested in one of the part-time jobs, an assessment would be carried out to see if her skills and experience were a suitable match. Later that day, the HR director informed the complainant that one of the part-time employees had decided not to opt for redundancy, leaving just one part-time job as a possible alternative for the complainant.
The complainant was asked to reply by close of business on August 27th, and when she didn’t indicate any interest in the remaining job, she was informed that she would be formally notified the next day, that her job was redundant.
On August 28th, the complainant was informed that, due to redundancy, her employment would be terminated on September 30th. She was required to work four weeks of her statutory entitlement to 12 weeks’ notice and she was to be paid for eight weeks in lieu of notice. She was informed of her right to appeal against the respondent’s decision to make her redundant, although she did not appeal. There was some correspondence between the complainant’s solicitor and the respondent and, on September 17th, the HR manager for Ireland wrote to confirm that her employment would terminate on September 30th, that she would be paid a statutory redundancy lump sum of €50,640, in addition to her entitlement to pay in lieu of eight weeks’ notice and holiday pay.
Evidence of the Human Resources Director, Ms Kim Morton
In her direct evidence, Ms Morton said that, in 2020, arising from the reduction in revenue and work, senior managers were asked to review their departments and to consider how headcount could be reduced. Some employees in Ireland left on early retirement and they were not replaced. Others who resigned were also not replaced. On the complainant’s team, there were just three people, Mary and the complainant, reporting to a manager. The manager reported to the quality lead, Ms Swan.
Ms Morton said that clients were not happy with the service being provided by the OpEx team in Ireland, and every time they didn’t meet their service level agreements, the company was fined.
On August 7th, Mary and the complainant were informed that their jobs were at risk of redundancy. Then, two part-time employees in the Investigations Department indicated an interest in redundancy, and this provided an option for Mary and the complainant.
Ms Morton said that she was happy with how the redundancy was handled. She said that the employee’s manager was always available to her and that she could be contacted and she engaged in email correspondence with the complainant. Ms Morton said that it was only near the end of the process that the complainant challenged the decision to make her job redundant. She never said that she had an issue and she didn’t disagree with the outcome. She never suggested that Mary wasn’t suitable for remaining in the role.
Cross-examining of Ms Morton
Responding to questions from Mr Drumm, Ms Morton said that she is the HR director for a number of countries, including the United Kingdom and Ireland. Ireland is part of the UK business. Due to the fact that the complainant transferred from AIB in 2014, her terms and conditions of employment are protected and she is on a higher salary than Mary, who wasn’t made redundant.
When she was asked what is meant by “right-sizing,” Ms Morton said that this means “having the right number of people in circumstances of diminished revenue or less work of a certain kind.”
Ms Morton confirmed that the company availed of government subsidies for a number of months during the Covid-19 pandemic. She said that they were advised by their auditors that their employees would not be eligible for the pandemic unemployment payment and they didn’t apply for the temporary wage subsidy scheme, because they were advised that, in the context of redundancies being implemented, they wouldn’t qualify. Ms Morton said that no consideration was given to placing the complainant on lay-off or short-time because they needed to look at long-term solutions.
The complainant’s job was made redundant in September 2020 and, the following September, Mary left the business. The manager remains and he is supported by employees in the UK.
Mr Drumm referred to the work carried out by the company for AIB and he asked if consideration was given to allocating the complainant to the work for that client. Ms Morton replied that consideration was given to offering one of two possible part-time jobs to the complainant. In the end, the more senior employee changed her mind about redundancy, and, when the complainant didn’t express any interest in the second job, that employee was not made redundant.
Ms Morton said that the option of redundancy was not offered to a wider pool of employees, and each manager reviewed their own business area.
Asked about the meeting on August 7th 2020, at which the complainant was advised that her job was at risk of redundancy, Ms Morton said that, in her view, there was no requirement for the complainant to have a representative at that meeting. She pointed out that the letter she sent to the complainant on the same day advised her of her right to be represented at any future meeting. At the meeting on August 7th, Ms Morton said that she made a presentation to the complainant and Mary, and this was sent to both employees afterwards. Ms Morton was satisfied that the employees understood the process that they were engaged in. She said that the consultation process was extended from two to four weeks. When it became apparent that only one job was at risk, a matrix was drawn up. Ms Morton said that the matrix of skills would have been known to the members of the OpEx team and they would have received some version of this matrix previously.
Regarding the remaining part-time role, Mr Drumm asked Ms Morton if the complainant was suitable for that job. She replied that she had the skills and would have been likely to get the job. Mr Drumm asked, “why not just give it to her?” Ms Morton replied that that’s not the way the company works and that it’s up to the line manager to carry out an assessment. The manager was aware that the complainant had been informed about the part-time job, and, if the complainant had indicated that she was interested in the job, the line manager would have gone ahead with the assessment.
In response to questions from me, Ms Morton agreed that, in hindsight, it would have been preferable to carry out an assessment of the suitability of the complainant and Mary for the remaining role, before commencing with the consultation process. She said that it was a big task to look at all the teams across Europe and certain things happening in the UK had an impact on Dublin. She said that there were no suitable roles for the complainant in the UK.
On August 28th, the complainant received a letter with formal confirmation of the termination of her employment due to redundancy. On August 30th, her solicitor, Mr Finn, wrote to the company saying that the decision to make her redundant should not proceed. Mr Finn asked the respondent to liaise with his office to discuss the situation. When he got no reply, he wrote again on September 7th saying that he would appeal the “sham redundancy;” however, no appeal was submitted. Ms Morton said that the company responded to that letter, although, in general, they “do not involve external parties in internal policies and procedures.”
Evidence of the UK Quality Lead, Ms Louise Swan
Ms Swan reports to the senior vice president for quality and she is responsible for the EMEA quality teams. She said that, arising from a degraded service being provided to clients, the “OpEX” team was introduced in Dublin in 2019. In 2020, she was directed to review her teams and to re-calibrate the headcount to accommodate loss of revenue and clients. Ms Swan said that they decided to retain an employee in Dublin to support their banking clients. The decision about who to retain was based on a skills matrix. Each function is competency-based and the customer has visibility of the competencies provided. The standard required is that an employee must be able to perform a competency without management intervention.
Ms Swan described the assessment of the complainant and Mary, from the point of view of their competencies. She said that the colleague could do customer surveillance work and she also produced daily and monthly reporting analysis. She said that the complainant did not have these competencies.
Cross-examining of Ms Swan
Mr Drumm asked Ms Swan about the rationale for retaining one role in Dublin. She replied that she decided to “bolster the risk framework” by keeping one job. She said that an internal review was carried out on her team and then she spoke to the complainant and Mary. She said that the matrix was completed later. The objective was to right-size the department based on the client revenue.
Mr Drumm discussed certain procedural issues around the redundancy process with Ms Swan, but it was apparent that this is not her area of responsibility.
Referring to the matrix produced to select the person to be retained on the OpEx team, Ms Swan said that this was produced when Mary indicated that she would accept redundancy. Ms Swan said that the matrix is a development tool and that it is updated quarterly. The matrix shows the skills that are needed in each department and is used for development purposes and as a skills tracker.
Mr Drumm suggested that there should never be a mismatch between the employee and the matrix and, if training is provided, an employee should be capable of doing everything on the matrix. Ms Swan said that a new matrix for the Dublin business was developed in 2019 and 2020. She said that they were “extinguishing fires” in 2019 and 2020 and knowledge was minimal.
In response to questions from me, Ms Swan said that in May 2019, it was apparent that there was no operational excellence in Dublin and she had to step in to implement new risk measures. Four employees came to Dublin from the UK to assist with this implementation. A new risk framework methodology was implemented for one bank. The experience of how to do this was not available in Dublin. She said that it took most of 2019 to do this work for one bank and then they started on the second key bank.
Ms Swan provided a detailed explanation of the risk control job carried out by her team and the control framework required to provide a service to client banks. She described the “before and after” scenario from before May 2019 until the new control mechanisms were introduced. Describing the matrix of skills, Ms Swan said that it is based on competencies and the capability of an employee to execute a task without management support. She said that it is not a performance tool and the absence of a competency does not mean that a person is incompetent. The complainant and Mary were competent in certain areas, but they hadn’t had exposure to the way the respondent needed to work. The process was entirely re-engineered and ongoing training was provided.
Ms Swan said that in 2019, a lot changed, and her department went from being reactive to pro-active. The matrix is a rolling document and is updated quarterly. She said that she gave a final copy to the HR manager on August 24th, after the employee’s colleague indicated that she was interested in redundancy.
Before she finished giving her evidence, I asked Ms Swan what the impetus was for making a job redundant in Dublin. She said that, since 2019, the process was a lot more efficient. She said that the UK OpEx team was also over-staffed because they had done a re-engineering job there also. Asked why Mary was retained, Ms Swan said that both employees were competent in terms of assurance, but Mary had more experience of monthly reporting and trend analysis. Ms Swan said that both employees were doing daily assurance work, but the colleague was carrying out additional work. The colleague resigned in September 2021.
The Respondent’s Case that the Redundancy of the Complainant was not Unfair
It is the respondent’s case that the complainant was made redundant due to right-sizing of the organisation in line with savings required, the structure across EMEA and the re-structuring across the UK and Irish businesses. Contrary to her submission on her complaint form, the process was not designed to remove her from the company and the complainant never indicated any concern that the proposed redundancy was disingenuous or illegitimate.
During the consultation process, the respondent identified two, and then one, potentially suitable roles. This was not a convenient vacancy, but one which arose unexpectedly when an employee on the Payments and Investigations Team said that she would consider being made redundant. The complainant expressed no interest in the role.
Referring to section 7 of the Unfair Dismissals Act 1977, Mr Conboy said that the respondent behaved reasonably and engaged in a thorough consultation process consisting of meetings and email correspondence between August 7th and 28th. The consultation period was extended to ensure maximum fairness to the complainant and the respondent’s managers were always available to answer questions and to discuss the issue on the telephone.
Mr Conboy said that the complainant was informed of her right to be represented at the beginning of the process. She was given an opportunity to reply to the “at risk” letter she received on August 7th. In follow-up email correspondence, she asked for details about her redundancy payment and she enquired about possible alternative jobs. The complainant was made redundant only when the possible alternatives had been considered. It is the respondent’s case that the redundancy of the complainant’s role was a necessary measure and that it was taken in line with the needs of the business. Mr Conboy asserted that “it was the role and not the person, that was made redundant.”
Concluding the process on August 28th, the complainant was reminded of her right to appeal and she was advised to lodge an appeal within seven days of receiving her letter of termination. She did not appeal before she finished up on September 30th or at any time afterwards.
On the complaint form she submitted to the WRC on October 12th 2020, the complainant asserts that, in the letter her solicitor sent to the respondent on September 7th, he exercised her right to appeal against the termination of her employment due to redundancy. The respondent’s policy provides that an employee may bring a colleague or a trade union representative to “any final stage redundancy consultation meetings or appeal meetings…” Mr Conboy drew my attention to the Code of Practice on Grievance and Disciplinary Procedures, Statutory Instrument 146 of 2000, where it is provided that an “employee representative” is a colleague chosen by the employee or a registered trade union representative “but not any other person or body unconnected with the enterprise.” Mr Conboy asserted that “no legal obligation could be said to exist with regard to engaging with the Complainant’s solicitor at that time, during what was an internal company process – a process and circumstance that could in no way…be described as exceptional.” In support of this argument, Mr Conboy referred to the decisions of the Supreme Court in the Burns & Another v The Governor of Castlerea Prison, and McElvey v Irish Rail.
Regarding the complainant’s assertion that she appealed the decision to make her job redundant, Mr Conboy referred to the letter from her solicitor, Mr Finn, dated September 7th 2020. Mr Finn stated:
“Without prejudice to any of our client’s alternative rights, our client will take whatever steps are necessary to preserve her employment including appealing your sham redundancy should you chose to humiliate her further and continue with this ruse.”
Mr Conboy said that this suggests a knowledge of the appeal process and the complainant’s entitlement to appeal if the demands set out in the letter of August 30th were not met.
It is the respondent’s case that the complainant’s employment was lawfully terminated on September 30th 2020, having been issued with notice on August 28th. The need for the redundancy was based on a genuine business case and the process was fair and reasonable and in line with the respondent’s procedure and the custom and practice in the company.
Without prejudice to this argument, Mr Conboy submitted that, if I find in favour of the complainant, I must take account of the redundancy payment already paid to her in September 2020. He referred to several precedents to support this position:
A Hotel Manager v A Hotel and Spa Resort, ADJ-00015257
Aoife Murphy v The Sims Clinic, ADJ-00032561
An Operations and Maintenance Manger v An Asset Management Company, ADJ-00019715
Sasta Hardware Limited v Emma Noack, UDD1827
Neil Duggan v Mitie Facilities Management, UD565/2015
Summary of Complainant’s Case:
In a submission provided in advance of the hearing, the complainant’s solicitor, Mr Finn, set out her career with the respondent from the date she commenced with AIB in January 1979 until her employment ended due to redundancy on September 30th 2020. The chronology leading up to confirmation that the complainant’s role was redundant is generally in line with the information provided in the respondent’s submission. Some further insights were included, providing context around the events following the initial consultation meeting with the complainant and her co-worker on August 7th 2020.
On August 19th, following the complainant’s enquiry about the possibility of avoiding redundancy and being redeployed to an alternative role, the HR director, Kim Morton, wrote to two at-risk employees to let them know that two part-time employees in the Operations Team in Dublin had expressed an interest in voluntary redundancy. One of the part-time employees later changed her mind about redundancy, leaving just one job available. The salary for the remaining job was €21,000, more than 50% less than the complainant’s salary.
On August 24th at 1.15pm, Mary wrote to the HR director and confirmed her intention to accept the redundancy package. At 2.30pm, she received a reply from Ms Swan, the quality team lead, telling her that a decision had been made to keep one job on the Operations Team, that her skills matched the role that was to be retained and that she was no longer at risk of redundancy. About an hour later, the HR director, Ms Morton, wrote to the complainant informing her about this decision and asking her about her interest in applying for one of the part-time jobs.
Although the respondent had achieved its objective of reducing the headcount on the Operations Team, a decision was made not to accept Mary’s voluntary application for redundancy. The complainant’s submission suggests that the respondent manufactured a skills matrix without any consultation with her or Mary and “arbitrarily implemented its findings under the skills matrix without even meeting or giving the complainant an opportunity to make representations.”
The following day, the complainant asked if she could appeal the decision to make her redundant. She was informed that she was not redundant and she was asked again to consider one of the part-time roles. On August 26th, the complainant was informed that only one of the part-time roles was available, because one of the part-time employees changed her mind about redundancy. She was told that there was no guarantee that she would be appointed to the job, and that an assessment would be carried out to determine her suitability. She was informed that the company would consider an application for voluntary redundancy “even at this late stage...”
On Friday, August 28th, at 6.30pm, Ms Morton wrote to the complainant to inform her that “as there is no suitable alternative role…” she would be made redundant and that her last working day would be September 30th 2020. She was advised that she had seven days to appeal this decision. In her submission, the complainant said that she didn’t get this letter before her solicitor, Mr Finn, wrote to Ms Morton and Ms Swan on Sunday, August 30th, requesting the respondent to cease the redundancy process and indicating that the complainant wished to remain in employment. No one replied to Mr Finn’s letter and he wrote again on September 7th. He received a reply two days later from Ms Morton saying that she would reply in due course. On September 17th, the respondent’s HR manager issued a letter to the complainant, confirming that, as there was “no suitable alternative available,” she was on notice, and due to leave the company on September 30th 2020. Mr Finn said that this letter meant that the complainant’s entitlement to appeal against the decision to make her redundant was unilaterally withdrawn.
Evidence of the Complainant
Opening her evidence, the complainant outlined her career since she joined AIB in 1979 and various moves until she was transferred to the respondent in 2014. The complainant said that she retained her AIB terms and conditions, with the result that she was paid more than Mary, because she had longer service and was on a different contract.
Mr Drumm asked the complainant about changes that occurred in 2019 and how they affected her. The complainant said that Ms Swan and her team came to Dublin and new guidelines and new control processes were introduced. She said that there was a lot of change, but that she was used to change.
In advance of the decision to retain Mary in her role, the complainant said that she wasn’t shown the skills matrix that was used to assess her competencies.
The complainant described the meeting of August 7th 2020 that she attended by conference call. She and Mary attended with their line manager and Ms Swan attended from the UK. She said that she and Mary were informed that they were both at risk. She said that no other meetings were arranged. After the meeting, she said that she and Mary were distraught. She said that they sent emails looking for redundancy figures and they asked about alternative jobs. They got details of two possible part-time roles in Operations. She said that the two part-timers sat beside them in the office and they were shocked when they heard that their jobs were offered to her and Mary. The complainant said that these two employees were not offered redundancy and they told her that they weren’t leaving.
The complainant said she was thrilled when Mary decided to accept redundancy. She said that she knew that she would have to do some training so that she could do the remaining job. On August 24th, when Mary got an email telling her that she wasn’t going to be made redundant, she was in the office with the complainant and she said, “come over here and read this email.” The complainant said that she couldn’t believe it. A couple of hours later, she got an email from Ms Swan, telling her that she wasn’t a suitable match for the remaining job and that she would be made redundant if she wasn’t interested in one of the two part-time jobs. Although she received further emails asking her if she wanted to apply for these jobs, the complainant said that she knew that these roles were not available. On August 26th, she got an email telling her that only one of the jobs was an option.
On September 17th, the complainant received what she referred to as a “leaver’s letter” and she finished up on September 30th. She said that she got a great send-off from the staff in the building, but “no word from Kim or Louise.”
Cross-examining of the Complainant
For the respondent, Mr Conboy asked the complainant about information she requested concerning the “Foley Agreement,” drawn up by the former head of conciliation at the Labour Relations Commission to deal with the transfer of employees from AIB to Banktec in 2014. The complainant said that she looked for a copy of the agreement. She said that she also asked for details about her potential redundancy lump sum and her holiday pay.
When she was asked if she was interested in an alternative job, the complainant replied that she wanted to keep her job. Mr Conboy asked the complainant about her reaction to Mary’s decision to accept redundancy. He asked her if she accepted that Mary was a better fit for the remaining job. The complainant replied, “Yes, but I would have come up to scratch.”
Mr Conboy referred to the letter issued to the complainant on September 17th 2020 in which the HR manager confirmed the termination of her employment on September 30th. The HR manager asked the complainant to get in touch if she had any queries. The complainant said that she was out sick for a few days and she spoke to the HR manager on the telephone. She said that she told the HR manager that she was distraught and she said that the manager was sympathetic. She said that she was “paying a solicitor” at that stage. Arguing that she appealed against the decision to make her redundant, she said that she was “beyond upset” and she appealed through her solicitor.
The Complainant’s Case that the Termination of her Employment was Unfair
The complainant’s case is that the redundancy of her role was a sham and that the selection process was unfair and subjective. The respondent’s objective to make one job redundant was achieved when Mary applied for redundancy, but this application was refused. Mr Finn argued that “the sole intention of the redundancy process was to remove the Complainant from her role in order to maximise cost efficiency” because she was paid substantially more than Mary.
With a cohort of 80 employees in its Dublin office, the respondent narrowed its redundancy option to just two people. Mr Finn suggested that this was done to target the complainant. He claimed that the categorisation of the complainant’s role as “falling within UK operations” was completely arbitrary; he said that her work had no UK element, her line manager was Dublin-based and she worked in Dublin for 41 years, engaged in clearing and compliance for Irish banks. She happened to have a reporting manager based in the UK.
Referring to section 5 of the respondent’s redundancy policy, and its objective to make “every effort to construct a fair and robust set of criteria following appropriate consultations,” Mr Finn said that it follows that the criteria must be developed only after the consultation period has expired. While the consultation period was extended until August 25th, the complainant and Mary were informed about the selection matrix on August 24th, before the consultation period ended. There was no consultation regarding the assessment criteria to be used to determine who should remain. Mr Finn suggested that the timeline of events on August 24th indicates that the “robust set of criteria” was developed one hour and 18 minutes after Mary indicated her willingness to accept voluntary redundancy.
In breach of section 5.2 of the policy, the complainant was never invited to a meeting after the meeting on August 7th at which she was informed that she was at risk of redundancy.
Concluding his submission on behalf of the complainant, Mr Finn said that she was not offered an opportunity to appeal the decision to make her redundant. Based on his correspondence of August 26th and 31st, he said that “any employer acting reasonably and fairly would have provided an Appeal based on the correspondence it received or at an absolute minimum, would have at least contacted the Complainant directly to clarify her wishes.” The entitlement to appeal was also set out in the complainant’s contract of employment. Mr Finn submitted that the right of appeal was also invoked in his letter of September 7th 2020.
Findings and Conclusions:
The Relevant Law
It is the complainant’s case that, with one of two jobs at risk, by not accepting her colleague’s application for redundancy, and, by making her redundant instead, her employer acted unreasonably and unfairly. Her complaint falls to be considered under the Unfair Dismissals Acts 1977 - 2015 and the Redundancy Payments Acts 1967 - 2014.
The Unfair Dismissals Acts 1977 - 2015
My task is to consider if, in terminating her employment, the respondent breached section 6(1) of the Unfair Dismissals Acts 1977 – 2015, (“the UD Act”) which provides that a dismissal is unfair, “unless, having regard to all the circumstances, there were substantial grounds justifying the dismissal.” The burden of proof rests with the respondent to set out the substantial grounds justifying the dismissal of the complainant. Their position is that she was dismissed due to redundancy because the complainant’s colleague, who I have referred to as “Mary,” was a better skills match for the remaining job.
Section 6(3) of the UD Act addresses the fairness or otherwise of a dismissal due to redundancy:
“Without prejudice to the generality of subsection (1) of this section, if an employee was dismissed due to redundancy but the circumstances constituting the redundancy applied equally to one or more other employees in similar employment with the same employer who have not been dismissed, and either—
“(a) the selection of that employee for dismissal resulted wholly or mainly from one or more of the matters specified in subsection (2) of this section or another matter that would not be a ground justifying dismissal, or
“(b) he was selected for dismissal in contravention of a procedure (being a procedure that has been agreed upon by or on behalf of the employer and by the employee or a trade union, or an excepted body under the Trade Union Acts, 1941 and 1971, representing him or has been established by the custom and practice of the employment concerned) relating to redundancy and there were no special reasons justifying a departure from that procedure,
“then the dismissal shall be deemed, for the purposes of this Act, to be an unfair dismissal.”
Section 6(2) which is referred to above as “subsection (2)” addresses the termination of employment for reasons related to trade union membership, religious or political opinions or for having made a protected disclosure and other matters that are not relevant to the complainant in this case.
In the case under consideration, “the circumstances constituting the redundancy” was the respondent’s need to reduce costs and to “right-size” the business in the context of reduced revenue and loss of business from some clients. It was evident at the hearing that these circumstances impacted on the job of the complainant and that of her colleague.
Section 6(7) of the UD Act provides that, in considering a complaint of unfair dismissal, as the adjudicator, I may have regard,
“(a) to the reasonableness or otherwise of the conduct (whether by act or omission) of the employer in relation to the dismissal, and
“(b) to the extent (if any) of the compliance or failure to comply by the employer, in relation to the employee, with the procedure referred to in section 14(1) of this Act or with the provisions of any code of practice referred to in paragraph (d) (inserted by the Unfair Dismissals (Amendment) Act, 1993) of section 7(2) of this Act.”
In her evidence, the complainant said that she wasn’t a member of trade union, having been expelled from the IBOA when she broke the picket during a bank strike in the early 1990s. On August 7th 2020, she was provided with a copy of the respondent’s redundancy procedure. This sets out a standard approach to the implementation of redundancies in any workplace, including the opportunity for consultation, representation, consideration of alternative jobs and the opportunity to appeal against an employer’s decision to proceed with a dismissal due to redundancy.
The Redundancy Payments Acts 1967 - 2014
The next step in my inquiry is to consider the definition of redundancy at section 7 of the Redundancy Payments Acts (“the RP Act”). Section 7(2) sets out five definitions of redundancy and, for our purpose here, we need to concern ourselves only with subsection (c):
“…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—
“(c) the fact that his employer has decided to carry on the business with fewer or no employees, whether by requiring the work for which the employee had been employed (or had been doing before his dismissal) to be done by other employees or otherwise[.]”
The respondent’s case is that, in August 2020, due to a general decline in revenue and the cessation of some of their clients’ business, there was a need to “right size” their organisation. In total, 134 jobs were cut, 107 in the UK and 27 in Dublin. On August 7th 2020, there was a plan to make the jobs of the complainant and Mary redundant, but that changed shortly afterwards and a decision was made to leave one of the jobs in Dublin and to eliminate a job in the UK instead.
Considering the case made by the respondent that the jobs of two people could, from now on, be done by one person, the dismissal of the complainant would appear to fall within the definition of redundancy at section 7(2)(c) of the RP Act. I am satisfied that a genuine redundancy situation existed when the complainant was dismissed in September 2020. I must now examine the case made by the complainant that the process that resulted in her redundancy was unfair, and that it was unreasonable for the respondent not to accept Mary’s application for redundancy and to select her instead.
Was it Reasonable for the Respondent to Make the Complainant Redundant?
Having worked in the financial services sector for 41 years, the complainant was used to dealing with changes in her job. In 2019, she said that she and Mary were trained in how to do their work differently and to a higher standard. She accepted that Mary was more skilled than her and that she would need training. In her evidence, Ms Swan said that it would have taken about 16 weeks for the complainant to reach the same standard as Mary. It is apparent therefore, that, with training, the complainant would have been capable of doing the job that remained.
In every redundancy situation, it is incumbent on an employer to try to preserve the jobs of employees who opt to remain in employment. In the case of this employee, as she was aged around 60, it must have been apparent to her managers that she was unlikely to find a job with the same salary before she reached pension age. To her credit, she found a new job in in sales and customer services when the Covid restrictions were lifted to some degree in November 2021, but her wages are now €357 per week, compared to €1,100 per week that she earned with the respondent. It is my view that most employers in a similar predicament to that faced by the respondent, would have accepted Mary’s redundancy and would have retained the complainant until she was due to retire around 2025.
Often, when there is a dispute about the selection process in a redundancy situation, one or other of the parties will refer to the 1994 decision of the Employment Appeals Tribunal (EAT) in St Ledger v Frontline Distributors Ireland Limited. Mr St Ledger was a warehouse supervisor who was dismissed and replaced by a colleague, Mr Kennedy, who, it was claimed, was better trained to do the job. The number of employees was not reduced and it was argued that Mr Ledger’s job had to be done differently, so that facts are different to the present case. However, the remarks of the chairman are important:
“Redundancy has two characteristics which are important in this case. It is impersonal and it involves change.”
In 2003, the decision of the EAT in this and other cases led to the amendment of section 7(2) of the RP Act and the insertion of the condition that redundancy is “not related to the employee.” The focus of redundancy must, in the first instance, be on a job. Its purpose is to eliminate a job or to effect change on a job and not a person. It seems to me that, faced with a willing leaver, some element of subjectivity resulted in the decision of the management to select the complainant for redundancy instead of Mary. If the complainant would have been capable of doing the remaining job to the required standard if she had been given training over a period of 16 weeks, then, it is my view that this is what should have been done. When Mary applied to be made redundant, the next step should have been to put in place a training programme and a hand-over, so that the complainant would be fully competent in the job before Mary left.
If this wasn’t a viable option for the respondent, another option presented itself in the part-time job in Operations. The respondent said that this job became available when a part-time employee applied for redundancy. In the “leaver’s letter” of September 17th, the HR manager referred to this as “…one alternative role identified during the consultation period, but you did not register interest for this role and so it was considered that no suitable alternative was available to you.” In her evidence, the complainant disputed the existence of this vacancy, although she didn’t test that assumption by applying for the job.
From the perspective of the managers, they were faced with on the one hand, an employee who was happy to go, and, on the other, an employee who was being dismissed and who wished to remain. The balance of power and the ability to make things happen in the employment relationship lies with management. Even if she hadn’t “registered an interest” in this job, it is my view that the managers should have taken the initiative and met the complainant to discuss what the job involved, the terms and conditions, the hours and the reporting relationships. I would go further and say that, if there was a vacancy that might have been a suitable match for the complainant’s skills, she should have been invited to participate in an informal assessment to determine any additional training that might have been necessary. Having refused Mary’s application for redundancy, faced with the compulsory redundancy of the complainant, I think that most reasonable employers would have re-deployed her to the alternative role that they identified.
Was the Process Fair?
As she was not represented until near the end of the consultation process that commenced on August 7th 2020, it seems to me that some mixed messages were sent when the complainant responded to the news of redundancy by asking for a calculation of her redundancy pay. There was no real need to make this request because the calculation wasn’t complicated and, it could have been done by the complainant herself using the online calculator on the website of the Department of Social Protection. I think that most HR managers receiving such a request would assume that an employee was interested in leaving, particularly, in this case, where the lump sum was substantial. The perception that the complainant was open to the redundancy option may have been further emphasised when she asked for details of the “Foley Agreement” on redundancy terms for former AIB staff who moved to Banktec in 2014. While this may have led the managers to assume that the complainant was interested in redundancy, the failure to engage in proper consultation meant that this assumption was never tested. In her evidence at the hearing, the complainant said that she didn’t want to be made redundant and that she was relieved when Mary decided to go.
I accept that the restrictions during the Covid-19 pandemic made it difficult to have meetings with the affected employees, particularly as the respondent’s managers were based in the UK. It seems to me however, that the respondent’s redundancy policy places the responsibility for engagement on the employee, as it states that individual appointments with your manager or HR will be available during the consultation period “should you request these via email.” This displays a certain detachment, and is unhelpful and unreasonable in any circumstances, but particularly where an employee with such long service is being dismissed. It appears from the documents submitted in evidence, that, after August 7th and until she received her letter of termination on September 17th, there was no face-to-face discussion with the complainant and all the engagement was by email. It occurs to me that one or two conversations could have taken place which may have avoided the necessity for this redundancy, and it is regrettable that this didn’t happen.
Finally, regarding her entitlement to appeal against the decision to make her redundant, I do not accept that the complainant was prevented from submitting an appeal. She received the letter of August 28th on August 31st and she had until September 4th to submit an appeal. Although she had the benefit of legal advice at the time, she did not submit an appeal.
I have examined the correspondence and it is abundantly clear from Mr Finn’s letter to Ms Swan and Ms Morton on August 30th that the complainant did not accept that she was redundant and that she wanted to remain in employment. It is my view that a reasonable employer would have replied to this letter, regardless of the stated policy not to deal with solicitors. I am certain that, with Mr Finn’s assistance, and some goodwill on the part of the respondent, this matter could have been resolved without the need for a two-day hearing at the WRC.
I have considered the written submissions and the evidence of both sides at the hearing of this complaint. It is my view that the respondent acted unreasonably by selecting the complainant for redundancy because a solution was available when her colleague applied to leave. As it was accepted by the respondent’s witnesses that the complainant could have been trained to the same standard as her colleague, some other criteria must have contributed to the decision to make her redundant. I find that the respondent’s decision is in contravention of section 7 of the RP Act and the requirement for a redundancy to be for “…reasons not related to the employee concerned…” I also find that the process that led to the complainant’s dismissal did not comply with fair procedures as there was no proper engagement with her regarding the alternatives to redundancy. In contravention of section 6(3) of the UD Act, I decide that her dismissal was substantively and procedurally unfair.
Section 8 of the Unfair Dismissals Acts, 1977 – 2015 requires that I make a decision in relation to the unfair dismissal claim consisting of a grant of redress in accordance with section 7 of the 1977 Act.
I have decided that this complaint is well founded. In accordance with section 7 of the Unfair Dismissals Act, I must make an award of redress in the form or reinstatement, re-engagement or compensation, as I consider appropriate. While the complainant opted for reinstatement or re-engagement, I was informed that, in September 2021, the complainant’s colleague on the Op-Ex team left her job and that the work that they did is now done in the UK. It is my view that an award of compensation is the most practical form of redress in the circumstances.
I have taken account of the submission made by Mr Conboy on behalf of the respondent, and the precedents he asked me to consider regarding the amount paid to the complainant as a redundancy lump sum. I am also mindful that, in mitigation of her losses, the complainant found another job in November 2021, just over one year after she was made redundant. She now earns one third of what she earned with the respondent.
I decide that the respondent is to pay the complainant €57,225 in compensation, equivalent to one year’s gross pay. As this compensation is in the form of loss of earnings, it is subject to the normal statutory deductions.
Dated: 10th August 2022
Workplace Relations Commission Adjudication Officer: Catherine Byrne
Dismissal, redundancy, redundancy procedures
 Record number 132/06
 Appeal no: 2018/178
 UD 56/1994