THE INDUSTRIAL TRIBUNALS

CASE REF:  7043/09

CLAIMANT:			Karen Dawn Flaherty

RESPONDENT:		Western Building Systems Ltd

DECISION
The unanimous decision of the tribunal is that the claimant was unfairly dismissed by the respondent and that the respondent failed to give the claimant her statutory minimum notice entitlement on termination of her employment.  The respondent shall pay the claimant £2,459.98.

Constitution of Tribunal:
Chairman:		Ms. M Bell

Panel Members	Mr. R Lowden
			Ms. F Graham

Appearances:
The claimant appeared in person.
The respondent was represented by Mr Martin McCloskey of the respondent company.

1.	The claimant complained in her claim form that she had been unfairly dismissed, that she did not receive any notice of termination of her employment and was not paid for untaken holidays due on termination of her employment, mention was also made in her claim form that religion may have been a factor but this complaint was not pursued by the claimant at hearing.

2.	The respondent in its response resisted all the claimant’s claims and asserted that the claimant was fairly dismissed by reason of redundancy after being properly advised and notified, that she had been paid wages, holiday pay and notice pay.  

ISSUES

 3.	The issues for the tribunal were as follows:-

		(i)	Whether the claimant has been unfairly dismissed?

(ii)	Whether the respondent failed to give the claimant proper notice of termination of her employment?

(iii)	Whether the respondent has failed to pay the claimant for untaken holidays?

EVIDENCE

 4.	The tribunal considered the claim, the response, documents handed in by the claimant and the respondent, and heard oral evidence from the claimant, Mr Martin McCloskey of the respondent company and his daughter Mrs Melissa Kavanagh also employed by the respondent as Accountant/Book-keeper.

FINDINGS OF FACT

 5.	The claimant was employed initially by Mr Martin McCloskey trading as Western Building Systems in April 2004, the business however incorporated in 2005 becoming Western Building Systems Ltd and the claimant’s employment continued with the limited company.

 6.	The claimant worked in one of the respondent’s four divisions, namely the Park Home division which manufactured park and holiday homes and accounted for around 20% of the respondent’s total business.  

 7.	The claimant was paid £325.60 gross per week being £261.70 net.

 8.	The Park Home’s division turnover peaked in 2007 at nearly £2½m but thereafter dropped sharply going down to around £200,000 in 2009.

 9.	The respondent experienced serious difficulty in obtaining large payments due from a number of its major customers in the Park/Home’s division in 2008 leading to the respondent having to put on hold those customer accounts.

10.	The downturn in the respondent’s business was so serious that on 16 December 2008 Mr McCloskey wrote to all employees stating “All employees are now on formal notice and all will be confirmed within one or two weeks if final employment is to end, and this will be dictated by fortnightly reviews based on any forthcoming orders.”

11.	The claimant received the respondent’s letter dated 16 December 2008 but was not particularly concerned and did not believe her job to be at risk as the letter stated that “starting today everyone will be informed personally of their position by their manager” however no one ever spoke to the claimant any further about her job or about it being at risk.  

12.	On 22 June 2009 Mr McCloskey came into the claimant’s office and spoke with her.  The terms of the discussion between the claimant and Mr McCloskey are in dispute, Mr McCloskey alleged in his evidence that he formally informed the claimant that her employment would cease as from Friday 10 July 2009, that he informed her that unless something extraordinary or an exceptional change occurred within the notice period that there would be no other option.  The claimant however alleges that Mr McCloskey came in to her office and said “I’ve good news and bad news for you, you may have work after July and you may not, keep your ear to the ground as things change here from day to day” and that then Mr McCloskey left her office before she had an opportunity to ask him any questions.  The tribunal finds the claimant’s evidence more credible with regard to the terms of the discussion between her and Mr McCloskey on 22 June 2009.

13.	The claimant immediately after Mr McCloskey’s comments to her went to the respondent’s factory foreman whom she considered to be her foreman, to ask if Mr McCloskey had spoken to him about her job, but he told her no.

14.	The claimant was left unclear as to what the position was with her job but felt that it was in fact secure when a specification for a new house was left on her desk in the week commencing 29 June 2009 and as she believed that she had sufficient new and unfinished work to do after the forthcoming July holiday period.

15.	On Tuesday 7 July the claimant became concerned again as to the position relating to her employment because other employees began to ask her whether Friday was her last day.  The claimant tried to find Mr McCloskey but when unsuccessful she approached his son Declan on Wednesday 8 July 2009 and asked him whether she had a job after the July holidays, he replied no.  The claimant was shocked, but carried on working that day.  The following day the claimant was still so upset she felt unable to continue working until the break up for the July holidays on the next day, Friday 10 July 2009, so she rang Mrs Kavanagh and asked if she would be kind enough to sort out her money then as she did not think that she could continue working that day.  The claimant left the respondent’s employment on Thursday 9 July 2009.

16.	The claimant received a letter dated 9 July 2009 enclosing £794.07 which the respondent confirmed therein was all the money due to her up to 8 July 2009 including her full holiday entitlement.  The claimant understood the payment received was made up of one weeks wages outstanding to her and two weeks holiday pay for the forthcoming two weeks July holidays.  

17.	Subsequently the respondent sent the claimant a letter dated 6 August 2009 confirming that they had calculated her redundancy entitlement at £1,628 and she later received this payment from the respondent.

18.	The claimant sought an Order for compensation only if successful in her claim against the respondent.

19.	The claimant had accrued 13 day’s holiday entitlement up to her date of termination but had already taken and been paid for six day’s holidays.

THE LAW

20.	The Employment (Northern Ireland) Order 2003 at Schedule 1 sets out the statutory minimum dismissal procedures to be followed as a bare minimum where applicable, by an employer contemplating dismissal or taking disciplinary action against an employee.  The standard procedure consists in summary of three steps requiring an employer to provide an employee at Step 1 with a written statement of grounds for action and an invitation to a meeting, at Step 2 to have a meeting with the employee and at Step 3 to provide the employee with an appeal.

21.	Under Article 126 of the Employment Rights (Northern Ireland) Order 1996 an employee has the right not to be unfairly dismissed by his employer.  Article 130 sets out how the question of whether a dismissal is fair or unfair is to be determined, however under Article 130A(1) an employee who is dismissed shall be regarded for the purposes of this part as unfairly dismissed if –

(a)	one of the procedures set out in Part 1 of Schedule 1 to the Employment (Northern Ireland) Order 2003 (Dismissal and Disciplinary Procedures) applies in relation to the dismissal, 

(b)	procedure has not been completed, and

(c)	the non-completion of the procedure is wholly or mainly attributable to failure by the employer to comply with its requirements.

22.	Where an Industrial Tribunal finds the grounds of complaint of unfair dismissal are well-founded the Orders it may make are set out at Article 146 of the 1996 Order and include reinstatement or re-engagement and otherwise compensation. How compensation is to be calculated is set out in Articles 152 to 161.

23.	There is provision at Article 17 of the 2003 Order for an uplift to be applied to awards in proceedings before an Industrial Tribunal relating to a claim under any of the jurisdictions listed in Schedule 2 by an employee where it appears to the Industrial Tribunal that a claim to which the proceedings relate concerns a matter to which one of the statutory procedures applies, the statutory procedure was not completed before the proceedings were begun, and the non-completion of the statutory procedure was wholly or mainly attributable to failure by the employer to comply with a requirement of the procedure, in which case it shall (subject to paragraph (4) therein) increase any award to which it makes to the employee by 10% and may, if it considers it just and equitable in all the circumstances to do so, increase it by a further amount, but not so as to make the total increase of more than 50%.

24.	An employer is required to give minimum notice to a person to terminate the contract of employment of not less than one week’s notice for each year of continuous employment if his period of continuous employment is two years or more but less than 12 years under Article 118 of the 1996 Order.

APPLYING THE LAW TO THE FACTS FOUND

25.	Whilst good industrial practice may demand more from an employer contemplating making an employee redundant, an employer is at the very least required where contemplating any dismissal, even a potential redundancy, to follow the minimum three procedural steps set out in the standard procedure of the statutory dispute resolution procedures.  The tribunal is satisfied after consideration of all the evidence before it that the standard dismissal procedure of the statutory dismissal and disciplinary resolution procedures was applicable to the claimant’s dismissal but was not in any way followed by the respondent and that its non-completion was clearly wholly attributable to the failure of the respondent to comply with its requirements.  Accordingly the tribunal finds that despite the existence of a potentially fair reason for dismissal, the claimant’s dismissal was automatically unfair under Article 130A(1) of the 1996 Order.  

26.	The tribunal is however satisfied on the respondent’s evidence, that even had the proper minimum statutory procedures been followed that the claimant’s employment would still ultimately have come to an end as a result of a redundancy situation and at best been extended for a further four week period following her return from the July holiday break, during which time the statutory minimum procedure could have been complied with.

27.	The tribunal accordingly awards compensation for the claimant’s unfair dismissal as follows:-

	Basic Award

	This is reduced to nil by the redundancy payment already made by the respondent to the claimant.

	Compensatory Award

	The amount of the compensatory award shall be such amount as the tribunal considers just and equitable in all the circumstances having regard to the loss sustained by the claimant in consequence of the dismissal insofar as that loss is attributable to action taken by the employer.  Based on the tribunal’s finding that had the respondent followed the statutory minimum procedures then the claimant’s employment would have continued but only for a limited period of four weeks following the July holidays, the tribunal consider it just and equitable to award four week’s pay at £261.70 per week by way of compensatory award to reflect the limited period the claimant’s employment would otherwise have continued.

Uplift

	Under Article 17 of the 2003 Order the tribunal increases the compensatory award by 10%.

	Notice

	Article 118(b) of the 1996 Order implies a minimum notice requirement into the claimant’s contract of employment requiring in this case for the respondent to give the employee a minimum of five week’s notice of termination of her employment.  The tribunal is satisfied that the claimant was not aware of termination of her employment until her discussion with Mr McCloskey’s son on 8 July 2009 and that she did not receive her statutory minimum notice entitlement.  The respondent shall pay the claimant five week’s notice in lieu thereof.

	Holiday Pay

	The tribunal is satisfied that the claimant had accrued 13 day’s holiday entitlement on termination of her employment for the 2009 holiday year, that she had already taken six days of these holidays leaving seven days accrued due but that she received 10 day’s holiday pay with the respondent’s letter dated 9 July 2009 and accordingly no payment in lieu of untaken holidays is due to the claimant.  The claimant’s claim for holiday pay is dismissed.

CONCLUSION

28.	It is the unanimous finding of the tribunal that the claimant was unfairly dismissed by the respondent, that the dismissal was automatically unfair for the respondent’s failure to comply with the statutory minimum dismissal procedure, wholly attributable to the respondent and that the respondent failed to give the claimant proper notice of termination of her employment.  The tribunal is satisfied that the respondent paid the claimant for all holidays accrued due to her up to termination of her employment and dismisses the claimant’s claim for unpaid holiday pay.

SUMMARY OF COMPENSATION

29.	Basic Award			      Nil

Compensatory Award	£1,046.80
	
Uplift				   £104.68

	Notice				£1,308.50

	Total				£2,459.98

30.	This is a relevant decision for the purposes of the Industrial Tribunals (Interest) Order (Northern Ireland) 1990.

Chairman:

Date and place of hearing:	25 January 2010, Belfast.

Date decision recorded in register and issued to parties: