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Genuine Redundancy Held to be an Unfair Dismissal Due to Failure of Employer to Seek Employee’s Input & Carry Out a Real Consultation Process

In the recent decision of Production Line Lead v Employer, ADJ-00024721, the Adjudication Officer determined that the Complainant was entitled to €40,000 in compensation for unfair dismissal of his employment but took into account the €27,518 redundancy payment the Complainant received at the termination of his employment. The total award therefore awarded by the Court was €12,482.

Facts: The Complainant commenced employment on 1st October 1994 as a production operative. He was promoted to senior operator and later to the Production Line Lead in April 2011. The Line Lead roles were declared redundant in July 2019 and the Complainant’s employment was terminated on 13th September 2019. The Complainant submitted that he was unfairly selected for redundancy and was therefore unfairly dismissed.

The Respondent submitted details of business difficulties encountered in 2019 as one of its client’s informed them that they were encountering a reduction in business activity and order volume. The client therefore required cost reductions from the Respondent. Therefore, the Respondent determined the solution to this was a management restructure to save costs and roles would be made redundant.

The Complainant had telephone consultation meetings with the Operations Manager and HR on 25th June, 1st, 11th and 17th July 2019. The Complainant repeatedly asked what the selection criteria were, but he did not receive an answer, only that the normal selection criteria did not apply. The Complainant was informed in the meeting on 1st July 2019 that the two Production Line roles were the only positions in scope for redundancy and he was also reminded that the other employee who held the Production Line Lead position was currently in the role on secondment. At the meeting of 19th July 2019 it was confirmed that the Line Lead role was redundant and would be removed from the management structure. The Complainant asked why the Line Lead role was no longer required but he received no answer.

The Complainant appealed the decision, and it was only in the outcome of the appeal that the Complainant learned that a job analysis was completed on all managerial roles in the business and the Company decided that Line Leads were the most suitable to be removed. The Complainant was not asked for any input on the analysis. It also transpired that the Line Lead role held by the other employee who was seconded from another area was returned to their original position as part of the restructuring and therefore remained an employee of the Respondent.

Decision: The Adjudication Officer concluded that although there was a genuine redundancy situation and two posts were made redundant, she did not accept that the Respondent acted fairly and reasonably. The two employees holding the Line Lead posts were treated differently, the reason that the Line Lead posts were selected was not communicated to the Complainant until after the appeal hearing and the consultation process engaged in was not real or substantial with no genuine attempt to identify a suitable alternative post for the Complainant.

The Adjudicator concluded that the Complainant was entitled to €40,000 in compensation for the unfair dismissal of his employment however, the Adjudicator took into account the €27,518 redundancy payment he received making the total award €12,482.

Takeaway for the Employers: Employers should ensure that the Employee is given as much information as possible during the consultation process and that his/her input is sought in respect of the basis for the redundancy and alternative roles. In this situation a genuine redundancy situation existed and a number of meetings occurred during the consultation process. However, the lack of transparency and failure to seek the employee’s input resulted in an unfair dismissal finding in favour of the employee.

Link  –  https://www.workplacerelations.ie/en/cases/2021/june/adj-00024721.html

Authors – Eva Lindsay and Anne O’Connell

1st July 2021

Anne O’Connell Solicitors

19-22 Lower Baggot Street, Dublin 2

www.aocsolicitors.ie

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