Action Health Enterprises Ltd (Represented by William Fry) v Michael D'Arcy (Represented by Reddy Charlton Sols)
| Jurisdiction | Ireland |
| Judgment Date | 24 March 2020 |
| Judgment citation (vLex) | [2020] 3 JIEC 2404 |
| Docket Number | FULL RECOMMENDATION DETERMINATION NO.UDD2019 ADJ-00014891 |
| Court | Labour Court (Ireland) |
FULL RECOMMENDATION
UD/19/141
DETERMINATION NO.UDD2019
ADJ-00014891
Labour Court
Chairman: Ms Jenkinson
Employer Member: Ms Connolly
Worker Member: Ms Treacy
SECTION 8A, UNFAIR DISMISSAL ACTS, 1977 TO 2015
1. Appeal Of Adjudication Officer Decision ADJ-000014891, CA-00019411-001
2. The Respondent appealed the Decision of the Adjudication Officer to the Labour Court on 26 June 2019 in accordance with Section 8(A) of the Unfair Dismissals Act 1977 to 2015. A Labour Court hearing took place on 26 February 2020. The following is the Determination of the Court:
This is an appeal by Action Health Enterprises Limited Partnership against the decision of an Adjudication Officer ADJ-000014891, CA-00019411-001 under the Unfair Dismissals Act 1977, as amended (“the 1977 Act”) in a claim of unfair dismissal by Mr Michael D'Arcy.
For ease of reference the parties are given the same designations as they had at first instance. Hence Mr Michael D'Arcy will be referred to as “the Complainant” and Action Health Enterprises Limited Partnership will be referred to as “the Respondent”.
The Adjudication Officer held for the Complainant on both the jurisdictional matter and on the substantive claim and ordered the Respondent to pay compensation of €45,000.
The Respondent appealed the Adjudication Officer's Decision on the basis that the Adjudication Officer:-
• “incorrectly decided that the Complainant had the requisite service required under section 2(1) of the UD Act in order to bring a claim of unfair dismissal. The Adjudication Officer had no jurisdiction to proceed to consider any substantive issue in the respect of the termination of the Complainant s employment nor to determine that such termination was unfair in circumstances where the Complainant is a person to whom, the UD Act “shall not apply by reason of the fact that he does not have 12 months' service.”
The Complainant lodged his claim with the WRC on 24th May 2018, the hearing before the Adjudication Officer took place on 5th November 2018 and 14th January 2019, and his Decision was issued on 16th May 2019. The Respondent referred its appeal to the Labour Court on 26th June 2019.
The Complainant commenced working as a Business Development Manager with the Respondent in 2014. Initially, the Complainant was on a contract for service rather than a contract of service. That arrangement remained in place until a contract of employment was issued to the Complainant on 31st January 2017, at which point his role and duties remained unaltered after his status changed from contractor to employee.
On 30th November 2017, the Complainant was dismissed from his employment on a no-fault basis and presented with a letter informing him that he will receive a payment in lieu of his contractual notice period of three months and his employment will terminate effective immediately. It stated that he will receive payments within 14 days. He received pay in lieu of notice on 17th December 2017. This payment was prompted by a letter from his solicitors' firm requesting payment.
The Complainant's contract of employment provides at Clause 10:-
• Termination with Notice:
“… employment may be terminated at any time by either you or the Partnership giving the other party at least three months ‘prior written notice, or statutory notice, if greater.”
○ “Where notice of termination of our employment is given, whether by you or the Partnership, the Partnership will have the right to:
Pay you in lieu of notice the amount of your entitlement to basic salary in respect of all or part of such notice period;”
As the Respondent's appeal is limited to the issue of jurisdiction, the parties agreed that the Court will confine its investigation of the case to that issue only and will not deal with the substantive arguments in the case.
Mr Marcus Dowling, B.L. instructed by William Fry Solicitors on behalf of the Respondent submitted that the Complainant did not have the necessary period of service required in order to bring a claim of unfair dismissal. He said that by letter dated 30th November 2017, the Respondent terminated the Complainant's employment on the giving of notice and exercised its right to pay him in lieu of notice.
Mr Dowling said that the Complainant was legally advised from the outset. At no time did he dispute that his employment had been invalidly terminated. In each correspondence between the Complainant's legal representatives and the Respondent's, there is reference to the fact that he was being paid in lieu of notice. In a letter dated 20th December 2017, the Complainant's solicitor stated that: “[the Complainant] is no longer an employee of [the Respondent].” Accordingly, Mr Dowling surmised, that while the Complainant alleged that the dismissal was unfair, he did not allege that it was ineffective.
Mr Dowling submitted that on a proper analysis, this case falls within the first leg of the definition of “date of dismissal” under the 1977 Act, i.e. the date of dismissal is:
Section 1
• (a) where prior notice of the termination of the contract of employment is given and it complies with the provisions of that contract and of the Minimum Notice and Terms of Employment Act, 1973, the date on which that notice expires.
He said that the Respondent exercised its right to terminate the Complainant's employment on the giving of notice. It then exercised its right to pay the Complainant in lieu of notice bringing his employment to an immediate end. He said it was important to note that from a contractual perspective the giving of notice and the exercising of the right to pay in lieu of notice are sequential even if both steps are affected in one letter. The 1973 Act specifically provides that it does not prevent the parties agreeing to accept payment in lieu of notice. Therefore, he submitted that the ‘date of dismissal” for the purposes of the 1977 Act was 30th November 2017.
In the alternative, Mr Dowling argued that even if the matter is treated as a “no notice” case, the same result is achieved. In a “no notice” case, date of dismissal is defined as follows:
Section 1
• (b) where either prior notice of such termination is not given or the notice given does not comply with the provisions of the contract of employment or the Minimum Notice and Terms of Employment Act 1973 (“the 1973 Act”) the date on which such a notice would have expired, if it had been given on the date of such termination and had been expressed to expire on the later of the following dates—
○ (i) the earliest date that would be in compliance with the provisions of the contract of employment
(ii) the earliest date that would be in compliance with the provisions of the Minimum Notice and Terms of Employment Act, 1973,
He said that the date of 30th November 2017 was in compliance with both the provisions of the contract and the provisions of the 1973 Act. If one somehow disregards the provisions of the 1973 Act which provide for payment in lieu of notice, that only adds one week onto the date giving a date of dismissal of 7th December 2017.
Mr Dowling disputed the Complainant's argument where he maintains that an employer is prohibited from avoiding the reckonable service accrued by an employee for the purposes of establishing the length of service required pursuant to the legislation by paying in lieu of notice. He maintained that both the 1973 Act and the 1977 Act provide the complete opposite. Insofar as the 1973 Act is concerned, it specifically provides that nothing in the Act prevents an employee from agreeing to accept payment in lieu of notice. The 1977 Act is equally clear, the definition of “date of dismissal” specifically refers in both legs of the definition to compliance with the contract. Therefore, termination of the Complainant's contract on 30th November 2017 by payment in lieu of notice was in compliance with the contract.
Mr Dowling referred to the Employment Appeals Tribunal case relied upon by the Complainant, Kinziger v Marketo Emea Limited [2016] 6 JIEC 2801, which Mr Dowling said does not properly engage with the relevant statutory provisions. In Kinziger, the employee was dismissed for gross misconduct. The employer nevertheless purported to pay the employee in lieu of notice. He argued, whether or not that form of equivocal termination is effective is clearly questionable, but that point does not appear to have been taken in the Kinziger case. The ratio of the decision is contained in the following passage:
•
○ “The Tribunal considered the respondent's submission that the part of this section which states: where the company exercises its right to pay you in lieu of notice, your employment will terminate with immediate effect and you will not be entitled to any further payments or benefits from the company”
•
○ does not operate to circumvent the strict notice requirements set out in the Act.
An employer and employee cannot “agree” to disregard a statutory construction in other words to disregard the provisions of the date of dismissal as defined in the 1977 Act .
The Tribunal noted para. 21.73 in “Dismissal Law in Ireland” by Mary Redmond
•
• “Under s. 1 of the Unfair Dismissals Act 1977, the date of dismissal is defined as the date on which a notice of termination expires or would have expired where the notice is, or would have been, in accordance with the contract of employment or with the Minimum Notice and Terms of Employment Act, 1973, whichever is the greater.””
Mr Dowling argued that this paragraph does no more than paraphrase the definition of ‘date of dismissal” and the Tribunal...
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