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Labour Court reduces WRC award by €5,000 on appeal

In the recent decision of Frances Murphy v Connemara Marble Industries, UD/18/134 the Labour Court upheld the dismissal as being an unfair dismissal but reduced the compensation awarded by the WRC by €5,000 as the Labour Court was not satisfied with the Complainant’s efforts to mitigate her financial loss.

Facts: The Complainant worked in the family business since the age of 13 and held a number of positions. The Complainant was paid €550 per week for working 25 hours per week and also received an annual bonus of €2,900 in December 2015. Upon the death of her father on 7th August 2015 the Complainant and her five siblings each inherited 1/6th of the family business.

Difficulties arose between the Complainant and her siblings, who were Directors of the Company from October 2015. The Complainant’s legal representative wrote to the Directors regarding the Directors’ remuneration paid in 2014 and 2015 as the Complainant believed it was a substantial amount of money that had been paid to them without the approval of any other shareholders. At the same time, the Complainant was refusing to undertake her normal duties in the business and the Complainant received a letter from the Managing Director (MD) warning her of disciplinary action if she continued to refuse instructions from the Company Directors. The relationship continued to deteriorate culminating in an incident at the Respondent’s premises which, as a result of the Complainant’s actions and that of another sibling and their respective husbands, the business had to close for the day and the Gardaí were called. As a result of this incident the Complainant was suspended on full pay pending an investigation.

The Complainant received a letter from the MD 21st February 2017 noting that the Complainant had issued claims in relation to her employment rights and that she was claiming that her employment had been terminated on 18th November 2016 and he therefore enclosed her P45. The Complainant had submitted a claim of constructive dismissal on 12th December 2016, however this claim was withdrawn on 12th April 2017, and a subsequent claim of Unfair Dismissal was referred to the WRC on 5th April 2017.

Decision: The dismissal itself is not in dispute and therefore it is the Respondent that carries the onus of showing that having regard to all the circumstances there were substantial grounds for justifying the dismissal. The Respondent contends that the dismissal was justified on grounds of the Complainant’s gross misconduct. The Court noted that although the Complainant’s conduct contributed to the disruption that took place on 18th November 2016 as no investigation was carried out into the incident, the Court had no option but to find that the Respondent’s actions in dismissing the Complainant in the circumstances was not made on reasonable grounds.

In determining the appropriate award the Court considered the above and also the burden on the Complainant to mitigate her loss. The Court noted that the Complainant failed to produce full details to the Court of her efforts to mitigate her loss. The Court therefore determined that the appropriate compensation was €25,000.   

Takeaway for the Employers:

This decision emphasises the importance of fair procedures when initiating disciplinary procedures against an employee. It is vital that even in cases involving gross misconduct that the employee has a right to fair procedures. It is also worth noting the emphasis the Court put on the failure of the Complainant to produce full details to the Court of efforts to mitigate her financial loss which ultimately had an impact on the compensation awarded by the Court.

Link  – https://www.workplacerelations.ie/en/cases/2020/october/udd2031.html

Authors – Eva Lindsay and Anne O’Connell

27th November 2020

Anne O’Connell Solicitors

19-22 Lower Baggot Street, Dublin 2

www.aocsolicitors.ie

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