THE INDUSTRIAL TRIBUNALS

CASE REF:    2444/10  

CLAIMANT:	Jim Gerard Crozier

RESPONDENTS:		1.  Michael Young
	2.  Younger Homes Ltd

DECISION

The Decision of the Industrial Tribunal is:

(i)	that the claimant was employed by Younger Homes Ltd and accordingly the first named respondent is dismissed from the proceedings;

(ii)	the claimant terminated his employment with notice to the second named respondent, who accordingly is liable to pay the claimant monies in respect of redundancy pay. The claim for holiday pay is dismissed as all monies due were discharged in November 2010. The second named respondent is ordered to pay to the claimant the sum of £3,420.00, 

Constitution of the Tribunal:

Chairman (sitting alone):	Ms M Sheehan

Appearances: 

The claimant was represented at hearing by Stuart Marriott from Magherafelt District Advice Services Ltd.  

Mr Michael Young, as director in Younger Homes Ltd appeared on behalf of the respondents.

The Issues

1.	The main issues for the tribunal to decide were (a) who was the claimant’s employer at the effective date of termination of employment; (b) was the claimant eligible for redundancy payment by reason of being laid off; (c) the amount of any redundancy payment due in respect of same; (d) was the claimant entitled to holiday pay and if so the amount of same. 

The Facts

2.	The tribunal considered the claim form and the response filed by the second named respondent. There was also oral evidence given by the claimant and Mr Michael Young. A bundle of documents was produced at the hearing by the claimant’s representative. The documents ranged from pay slips for the claimant and various correspondence between the parties prior to and after the “lay off” period and the notice of intention from the claimant to the second named respondent to claim a redundancy payment. A letter dated 11 April 2011 signed by Michael Young on behalf of Younger Homes Ltd was faxed and posted to the Office of the Industrial Tribunals and Fair Employment Tribunal stating that any holiday pay due and owing had been discharged and accepting redundancy payment was still outstanding due to financial difficulties of the second named respondent.  On the basis of the evidence received we make the following findings of fact.

3.	The claimant when employed initially at Younger Homes Ltd, in July 2004, was aged 45 years of age and aged 51 years of age when he terminated that employment. The claimant was unsure whether he had been given a written statement of main terms and conditions of employment. No such document was produced at hearing by the second named respondent who accepted they were the claimant’s employer at the relevant time. The tribunal had sight of two different written statements of terms and conditions for employees of the second named respondent and concluded it was more likely than not that the claimant had similar written terms and conditions of employment as other employees who commenced employment in or about the same time as the claimant. 

4.	The tribunal did have available to it a copy of the terms and conditions provided to another employee Charlotte O’Kane, who was a claimant in a case heard at the same time as this claimant’s claim. Ms O’Kane like the claimant had commenced employment in 2004 – in her case February 2004.  The claimant was employed as a goods Supervisor. The claimant was employed at an hourly rate of pay and it became clear from the evidence that in or about 2008, the claimant’s terms and conditions were varied so that instead of an annual salary the claimant moved to a variable wage depending on the number of hours worked. The hourly rate at the time of termination of employment was £10.35 gross. The salary documents provided in the bundle prepared by the claimant showed a weekly gross wage for the 12 week period prior to the commencement of “lay off” on 18 June 2010 was £626.28. 

5.	The written statement of terms and conditions of employment provided to staff in 2004 included no express provision regarding “lay of” or “short time”. Other employees who were before the tribunal at the same time as this claimant but employed at an earlier date did have written statements of terms and conditions which included such a clause. There had been earlier “lay off” periods in 2009 and this claimant, like others, had remained in the second named respondent’s employment subsequent to the period of lay off.

6.	By letter dated 18 June 2010 the claimant was placed on temporary lay –off for an initial eight week period. During this period the claimant was provided with some work by the second named respondent but the claimant earned less than half a weeks pay. No such employment was offered after the 9 July 2010. By letter dated 9 August 2010 the claimant received notice of the second named respondent’s intention to extend the current period of “lay off” for a further five weeks with effect from 2 August 2010. By letter dated 27 August 2010 the claimant gave notice to Younger Homes Ltd of his intention to claim a redundancy payment. At the same time he gave notice to terminate his contract of employment. He stated he “had no knowledge of any period of contractual notice and therefore he gave a week’s notice which expires on 3 September 2010”. A further letter dated 3 September 2010 was sent by the claimant to the second named respondent claiming a statutory redundancy payment of £3,420 as well as monies in respect of unpaid guarantee payment, unpaid wages and holiday pay. 

7.	The claimant received no response from the second named respondent to his letter dated 27 August 2010 or 3 September 2010 until a letter was sent dated 28 October 2010 – indicating that his resignation was accepted and acknowledging he was owed a redundancy payment in the sum of £3,420.00. It also referred to his holiday pay which “will be included along with your redundancy settlement in your final pay from Younger Homes Ltd”. The letter made no reference to notice other than to repeat the contents of the claimant’s letter in regard to that issue. The respondent stated they had insufficient funds to pay the monies owed but “hope to be in a position to pay you and all our creditors by the middle of next year”. 

8.	The statement of main terms and conditions of employment produced at hearing by other claimants employed like this claimant in 2004 sets out at clause 12 of that document notice period as follows: 

“The period of notice you are entitled to receive in the event of termination of employment or are required to give in the event of you deciding to leave the company is as follows – At least 2 years of continuous service but less than 12 years – the notice entitlement was “I week for each year of service”. 

There was nothing in the contractual document of waiver of that entitlement or requirement by mutual agreement.

9.	On the 5 November 2010 the claimant was sent a cheque for £1,419.75 with a compliment slip from the second named respondent stating “Please find enclosed cheque for holiday pay, pay and statutory guarantee payment”. No breakdown of how the monies were calculated was enclosed. At hearing evidence was produced of the calculations underlying the monies tendered in November 2010 and a breakdown of the figures was provided. It became clear that the figure tendered in November 2010 was the figure for holiday pay, statutory guarantee payment and outstanding wages less tax and national insurance.

10.	The claimant submitted his claim to the Office of Industrial Tribunals and Fair Employment Tribunal on 13 October 2010. In the claim form the claimant disclosed that he had not claimed job seekers allowance. The claimant indicated he had found alternative employment as of the 14 September 2010. 

11.	The respondent’s response referred to the letter received from the claimant dated 3 September 2010 and stated a P45 was posted to Mr Crozier on 13 October 2010. 

12.	The parties were agreed that any redundancy payment would be subject to the statutory maximum of £380, in light of the average weekly wage of the claimant during his employment being in excess of that sum. 

The Relevant Law and Decision

13.	The tribunal considered the provisions of Article 170 (1) (b) of the Employment Rights (Northern Ireland) Order 1996 (hereafter referred to as the 1996 Order) which states that an employer “shall pay a redundancy payment to any employee of his if the employee is eligible for a redundancy payment by reason of being laid off or kept on short time”. Employers do not have an automatic right to lay off employees without pay. Their right depends on contractual provisions which can be incorporated into the contract of employment in a number of ways. It can be expressly written, included in a collective agreement, implied as a term through custom and practice or agreed by both parties to the contract. 

14.	There are certain conditions laid out in Part XII of the 1996 Order which the claimant must satisfy to protect his entitlement to a redundancy payment. The relevant provisions in respect of this claimant are found in Articles 182 – 185, 190, 198 and 199 of the 1996 Order. Article 183 to 185 inclusive sets out qualifying conditions that must be satisfied to protect that eligibility to redundancy payment. Article 185 of the 1996 Order provides “An employee is not entitled to a redundancy payment by reason of being laid off unless he terminates his contract of employment by giving such period of notice as is required for the purposes of this Article before the end of the relevant period”. The relevant period is defined in Article 185 (3) - in effect before the expiration of four weeks from service of the notice of intention to claim. The period of notice required in the circumstances where the employee is required by his contract of employment to give more than one weeks notice to terminate the contract is “the minimum period which he is required to give and otherwise one week”.  

15.	The date of termination is governed by Article 129 (1) (b) of the Employment Rights (Northern Ireland) Order 1996 and is the date the “termination takes effect”.  

16.	Article 197 of the 1996 Order sets out how the amount of the redundancy payment shall be calculated.

17.	Under the Industrial Tribunal Extension of Jurisdiction Order (Northern Ireland) 1994 an employee may bring a claim for damages for breach of his contract of employment or for a sum due under that contract or any other contract connected with his employment before an Industrial Tribunal if the claim arises out of or is outstanding on termination of his employment.
   
Applying the Law to Facts Found

18.	The tribunal is satisfied in light of the evidence of earlier lay off periods in 2009, which did not result in the claimant treating same as a breach of his contract, that in the circumstances of this case there is an implied provision in the contract of the claimant permitting the second named respondent to “lay off” this employee without pay. The claimant established that he is eligible for a redundancy payment by reason of “lay off” as provided for by Article 183 of the 1996 Order. The period of lay off had commenced for this claimant on 18 June 2010 and the claimant had received notice that it would continue for 8 weeks taking it to the 13 August 2010. Then by letter dated 9 August the claimant was given notice of an extension of the “lay off” for five weeks, effective from 2 August 2010, due to end 6 September 2010. During the period of “lay off” the claimant received less than half a weeks pay. By the claimant giving notice on the 27 August 2010, he gave notice within four weeks of the ending of the first “lay off” period, the eight weeks, notified to him on 18th June 2010, thereby satisfying the conditions of Article 183 (1) and (2) (a) of the 1996 Order. No counter notice was served by the second named respondent. 

19.	The claimant must give notice of resignation as required by Article 185 of the 1996 Order before “the end of the relevant period” – see Article 185 (1) of the 1996 Order. The period of notice to be given in this case was “the minimum period he was required to give, within the terms of his contract of employment and otherwise, is one week”. Clause 12 of the relevant contract of employment for those employed like the claimant in 2004, made it clear that the notice required was one week for each year of service. However it appears the employer was content to waive that requirement as no objection was made to the notice tendered by the claimant- the statutory maximum of one week. The second named respondent confirmed their acceptance of the claimant’s resignation with effect from 3 September 2010. The parties to a contract can agree variation at any time and accordingly the tribunal concluded that the period of notice to be given in this case was “one week”. 

20.	The “relevant period” for the giving of notice of resignation, where an employer does not give a counter notice is within four weeks of notice of intention to claim. While case law supports the proposition that the legislative requirements must be followed strictly – there is authority the tribunal can “resolve the issue as to resignation by taking into account the particular circumstances which applied in that context” – Buffrey, Auker–Howlett and Baldwin v Manpower PLC [2003] UKEAT 0443/02/0804. In this case the claimant gave notice of resignation at the same time as the notice of intention to claim.  Even though the notice of resignation was given at the same time as the notice of intention to claim it appears to the tribunal that does not undermine the claimant’s legal entitlement as such notice of resignation has still been given “before the end of the relevant period”. The tribunal takes the view that this notice of resignation is still “within four weeks of notice of intention to claim”. In all the circumstances of this case the tribunal determined that the date of effective termination for the claimant’s employment was 3 September 2010. 

21.	The tribunal dismisses the claimant’s claim for holiday pay, unpaid wages and unpaid statutory guarantee payments as it is satisfied on a balance of probabilities that all such sums due and owing were discharged in the payment tendered on 
5 November 2010.

Award

22.	The tribunal considered Articles 17 to 20 and Articles 197 of the Employment Rights (Northern Ireland) Order 1996. There was no break in any of the claimant’s continuity of employment. The claimant had six complete years of service, commencing when he was aged 45 years. This would have entitled the claimant to one and a half week’s gross pay for each of the six years service as a redundancy payment subject to the relevant statutory maximum weekly wage which is £380.00.  The claimant is entitled to a payment representing nine weeks gross pay – 9 x statutory maximum gross weeks pay namely £380.00 = £3,420.00.

23.	The tribunal orders that the first named respondent be dismissed from these proceedings as he was not the employer of the claimant at any time during the claimant’s employment in particular at the relevant date of termination of that employment.

24.	The Employment Protection (Recoupment of Job Seeker’s Allowance and Income Support) Regulations (Northern Ireland) 1996 do not apply to this decision. 

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

Chairman:

Date and place of hearing:    19 April 2011, Belfast.

Date decision recorded in the register and issued to the parties: