No Hold on Employment Injunction for Appeal Due to Employee’s Financial Position

Introduction

In the case of O’ Donovan v Over-C Technology Ltd & Another [2020] IEHC 291 the Plaintiff, Mr O’Donovan, was dismissed from his position as CFO. The Order made by Judge Keane in this case was unusual. You can read about this judgement in last month’s newsletter using the below link:

Further Judgement

There were still some matter that were left to between the parties. In a further judgement on this case on 3^rd July 2020 by Mr Justice David Keane there were still some matters that were left to be resolved between the parties. In accordance with the joint statement Chief Justice and the Presidents of each court during the Covid-19 pandemic, the parties had been invited to seek agreement on any outstanding issues, including costs of the application, failing which they were to file written submissions which would then be ruled upon remotely. There was little to no agreement between the parties and so written submissions were filed addressing a range of issues including the appropriate order on costs, the appropriate directions to facilitate an early trial and also whether it is appropriate to grant a stay on the employment injunction order, which included paying the Plaintiff for 6 months pay, pending the hearing of the appeal of that order.

Keane J issued a further judgement on these outstanding issues on 3^rd July 2020 and ordered that:

1. the Plaintiff is not entitled to the payment of a liquidated sum in the circumstances where he will already have an entitlement to whatever arrears of salary and other benefits accrued to him;

• the duration of six months of arrears was in the interests of justice. Keane J commented that by fixing the duration of salary payments to be made by the employer in Fennelly, the Supreme Court “was setting a general limit, or creating a specific and inflexible rule, on the appropriate duration of such payments in respect of all such orders”.
• that there was insufficient reason to take this matter into case management. Keane J noted that there was no urgency that warranted an early trial as both parties acknowledged that the employment relationship has been irrefutably damaged and Mr O’Donovan’s claim is in reality one for a fair termination process rather than for reinstatement in the role of CFO. Keane J also noted that the Plaintiff is free to pursue new employment and the Defendant has been released from their duty not to appoint a new CFO to replace Mr O’Donovan.

• that there was no reason to depart from the usual rule as to costs and so granted costs in the cause i.e. the Plaintiff was awarded his costs.

• that the balance of convenience is tilted against placing a stay on the interlocutory order pending appeal. The Court noted that although the Defendant indicated their wish to appeal they did not indicate on what grounds they propose to appeal and the Court could therefore not be satisfied that there is an arguable ground for appeal. Interestingly the Court took into consideration the financial circumstances the Plaintiff in that he could not discharge his household and living expenses without the benefit of the Order regardless of this fact making it unlikely that the Defendant could recover the payment back from the Plaintiff in the event of their successful defence at trial. The Court refused the application for a stay on the Order of the injunction. The Defendant must therefore pay the Plaintiff six months’ worth of salary and benefits from the end of January 2020 to July 2020.

It is interesting that Keane J refused to put the case forward for case management in circumstances where the Plaintiff finds himself in such dire financial circumstances and instead refused a stay on the Order.

Take away for employers

This decision puts in doubt the ability to rely on an employee’s undertaking given to the court as to costs and/or damages incurred by the granting of an injunction in the event that the trial orders against the employee. Such undertakings are required as the judge hearing injunction applications do not hear the full case. Also, the Judge re-iterated his view that the injunction order for salary payment until the hearing of the trial should be limited to 6 months which limits expense for employers and that attraction for employees to take such applications. 

Link: https://beta.courts.ie/view/judgments/70402024-d81a-4149-a6e1-07c2a4e5aefb/a5d574e4-2680-4d01-badc-58c833cab392/2020_IEHC_327.pdf/pdf

31^st July 2020

Authors: Anne O’Connell and Eva Lindsay

Anne O’Connell Solicitors

Fitzwilliam Hall

Fitzwilliam Place

Dublin 2

www.aocsolicitors.ie

If you found this article useful you might like our employment law newsletter. We write monthly articles, like this, covering interesting cases, decisions, news and developments in Ireland.

Related Articles

• High Court Clarifies the Scope of a De Novo Appeal to the Labour Court
• WRC Finds Employer’s Sick Pay Scheme More Favourable Overall Than Statutory Sick Pay Scheme
• WRC Looks Behind Company and Deems an Individual an Employee
• Government Publish Updated Code of Practice on Determining Employment Status
• Pregnant Employee who was Dismissed Awarded €136,200 in WRC
• Reeling In The Year 2024
• Recent WRC Decision Highlights the Importance of Neuro-inclusion in the Workplace
• WRC Finds Employee Constructively Dismissed After Being Offered An Exit Package Just Days After Commencing A PIP