Employer Resources Newsletter - November 2020
FIXED TERM CONTRACTS ENDING
As we approach the year end Employers should be mindful of any fixed term contracts coming to an end. A fixed term contract is a contract which is put in place for a temporary period and has a definite duration or purpose.
The end of the contract is determined by an objective condition such as:
- The arrival of a specific date
- The completion of a task / project
- The occurrence of a specific event.
What is the difference between a fixed term and a fixed purpose contract?
A fixed term contract is for a (fixed) duration / term of work required e.g. an Employee being hired during a busy seasonable time (i.e. Christmas). A fixed purpose contract expires when the specified (fixed) purpose of the role is fulfilled e.g. completion of a project or an Employee returning from long-term sick leave.
The Protection of Employees (Fixed-Term Work) Act, 2003 is in place to ensure that there is no discrimination in relation to conditions of employment as between a fixed term / purpose worker and a comparable permanent employee. It is also in place to prevent abuse by Employers of the use of successive fixed term contracts.
A fixed term / purpose contract must specify the objective condition which brings the contract to a natural end. As outlined above, this may be a specified date, the completion of a specific task / project, or the occurrence of a specific event. Once this objective condition is satisfied, the natural expiry of the contract occurs. Objective provisions may include:
- A fixed term – the contract expires on a particular date;
- A specified purpose – the contract expires when the specified purpose of the role is fulfilled, e.g. completion of a project;
- The occurrence of a specific event, e.g. Employee X returning from maternity leave.
Fixed term / purpose contracts must also include a clause precluding the provisions of the Unfair Dismissals Acts applying to a termination resulting solely from the expiry of the fixed term / purpose contract. It is important to note that the Unfair Dismissals Acts will still apply to termination for any other reason other than the natural expiry of the contract, e.g. performance, conduct, attendance, redundancy etc.
Renewals & Extensions
If an Organisation wishes to renew a fixed term / purpose contract, they must have objective grounds justifying the renewal and failure to offer a contract of indefinite duration (i.e. a permanent contract) at that time.
The Act provides that where an Employer proposes to renew or extend a fixed term / purpose contract the Employee shall be informed in writing, not later than the date of renewal, of the objective grounds justifying the renewal of the fixed term / purpose contract and the failure to offer a contract of indefinite duration at that time.
When renewing or extending a fixed term / purpose contract it is a legal requirement that the Employer advises the Employee, in writing prior to the expiry of the current contract, of the fact that the contract is to be renewed. The legislation requires that the Employer outline the objective reasons for renewing the fixed term / purpose contract and not offering permanent employment at the time. A failure to provide this will not leave an Employer liable to a fine, however, where an Employee pursues a claim for permanency, the Employer’s case will be severely weakened by their absence.
Employee Unfairly Dismissed Award 6,000 Euro
The Complainant was employed as a Warehouse Operative with the Respondent who runs a freight business since January 2016. Following a serious complaint from one of the Respondent’s main customers about the Complainant he was dismissed on May 2020. His gross monthly salary was €3,000.
Summary of Complainant’s Case
The Complainant worked for the Respondent for over four years and he was suspended with pay following a complaint from a customer representative. This was the first complaint about the Complainant during his employment with the Respondent. He reported the problems with this customer to the warehouse manager following an interaction, but the manager did not do anything. While on suspension he was invited at short notice to an investigation meeting in May 2020 and was dismissed at the end of that meeting.
The Complainant was unhappy with the investigation as he was not allowed to produce evidence to defend his case.
It is the Complainant’s position that the Respondent used the complaint as an opportunity to dismiss him. The Complainant also submits that the process used by the Respondent was flawed and was treated “unfairly and unilaterally judged”. The Complaint outlined his particular concerns in relation to the process that was followed.
The Complainant has obtained occasional work for some weeks following his dismissal and later obtained more regular employment. Details were provided at the hearing. The Complainant is seeking financial compensation for the financial loss suffered as a result of his dismissal.
Summary of Respondent’s Case
The Respondent is a long-established independent freight express company, places significant emphasis on the fact that they are a service company and in that context their business relies almost exclusively on the reputation and service they provide to their clients.
On 28th April 2020 the CEO received a phone call from a very distressed and shaken customer who outlined that she was the recipient of she described as a rude and aggressive conversation with the Complainant. She said that the Complainant had an issue with her because she was female and that another (male) colleague is never treated in this manner by the Complainant. The Complainant queried where she got his number and she explained that it was given to her by the Respondent. This was a company telephone and therefore there was no issue about the giving the number to customer. The customer felt that it was important for the CEO to be aware of “what I have to deal with on occasions from your staff.” She also provided copies of e mails from the Complainant to her which also caused her concern.
The CEO was most concerned at this complaint. He contacted a senior manager in the customers company to let him know that what was alleged to have happened was “unacceptable, intolerable and against the company ethos.” He assured the manager that the matter was escalated internally and would be dealt with. This company represented over 40% of the Respondents business and a loss of this business would have devastating consequences on the company and its employees.
The CEO and Sales Director met with the Complainant and informed the Respondent of their concerns following the receipt of the complaint. The Complainant was advised that he would be suspended on full pay pending the investigation and they would do their best to conduct the investigation promptly.
The CEO and another Director undertook the investigation and met with the various people involved. Following that it was decided to meet with the Complainant to outline to him the evidence gathered. He was informed of the meeting by registered letter which seems to have been delayed due to a public holiday. At the meeting on 05/05/20 the CEO outlined that the customer was one of their top customers with whom they had completed a rate restructure to retain their account. Due to the nature of the interaction which the Respondent felt was unprofessional, and insulting towards a major client, it fell within the scope of gross dismissal in their disciplinary policy. The only outcome was that he would be dismissed from the company and this was confirmed to him.
The Complainant requested to work in another area, but this was not possible. He also asked the Respondent to ask the company who lodged the complaint against him if it was right that he should be dismissed. The Respondent submits that they had no option but to dismiss the Complainant. They had to act promptly, and the Complainant was given every opportunity to outline his version of events.
Finding and Conclusions
Having consider the legislation the Adjudicator found that there was serious procedural flaws in the investigation process, disciplinary hearing and appeal process which resulted in the dismissal of the Complainant. Of concern is the presence of the CEO at all stages of the process. As the Complainant was not represented at any stage there was an obligation on the Respondent to comply with the principles of natural justice, their own procedures and acceptable practices as outlined in the Code of Practice on Grievance and Disciplinary Procedures (SI 146 of 2000). The short notice of the Meeting 2 on 05/05/2020 given to the Complainant represents a further serious shortcoming by the Respondent in terms of fair procedures and robust procedures.
The Adjudicator accepted the Complainant’s evidence that there was no internal appeal process available given the manner in which the dismissal was carried out. The Adjudicator stated that the Respondent showed no regard to the principles of fair procedures and natural justice or indeed its own procedures. In that context the dismissal in this case is unfair from a procedural perspective.
The Adjudicator found that the Complainant contributed to the situation he found himself in. The Adjudicator stated that he provided no credible explanation for what occurred and did not accept that the incident had the potential to cause the loss of a significant customer.
The Adjudicator accepted the Respondent’s evidence that the lack of remorse at any stage by the Complainant was a significant contributory factor in their decision to dismiss.
The Adjudicator too into consideration that there was a total of eight weeks when the Complainant did not find any work before finding full time work. The Adjudicator also considered the extent to which the Complainant’s conduct contributed to the dismissal and that he damaged the Respondent’s trust and confidence in him. The Adjudicator having taken all matters into account I found that the Complainant’s dismissal was procedurally unfair within the meaning of Section 6 of the Acts. The Adjudicator found that the Complainant’s claim under the Unfair Dismissals Act is well founded and he was awarded compensation of €6,000.
The complaint was well founded - The Adjudicator awarded the Complainant €6,000.00 in compensation.
This case is a reminder of the importance of adhering to fair procedure throughout the disciplinary process. Procedures are necessary to ensure that discipline is maintained in the workplace by applying disciplinary measures in a fair and consistent manner. Apart from considerations of equity and natural justice, the maintenance of a good industrial relations atmosphere in the workplace requires that acceptable fair procedures are in place and observed.
Such procedures serve a dual purpose in that they provide a framework which enables management to maintain satisfactory standards and Employees to have access to procedures whereby alleged failures to comply with these standards may be fairly and sensitively addressed. It is important that procedures of this kind exist and that the purpose, function and terms of such procedures are clearly understood by all concerned.
Employee Who Was On Certified Sick Leave Seeking Adjudication Under the Payment of Wages Act
The Complainant who was employed since October 2014, was on certified sick leave from 7th January until 18th May 2020 when she became available to work for the company again. The complaint revolves around the company’s policy and procedures related to pay during sick leave.
Summary of Complainant’s Case
The Complainant submitted that she signed a contract upon joining and that while she was out on Maternity leave, she received another contract with amended terms and conditions (including those regarding sick leave). The Complainant queried elements of the contract (although not the sick leave changes) but did not receive an answer to her queries. The Complainant submitted that she returned to work on 6th January 2020 and was told that she was being made redundant. She went on certified sick leave for work-related sick leave from 7th January 2020 until 18th May when she was once again available to work but availed of the Government Covid-19 payment scheme.
The complainant confirmed that she was on illness benefit from 10th February until 18th May and went onto this scheme when it became apparent at the end of January that she was not being paid sick pay from her employer.
The Complainant submitted that although her original contract states that sick pay is discretionary, it has always been the practice to pay sick leave to staff who are out sick and that she should have been paid it in these circumstances.
The Complainant does not accept that her contract changed during her maternity leave and accordingly seeks pay for the duration of the certified sick leave period.
Summary of Respondent’s Case
The Respondent denied that it was custom and practice to pay staff sick pay. The Respondent accepted that it did not pay the complainant during her certified sick leave period but argued that under the revised contract, it was not required to pay for illness absences.
The Respondent submitted that in the alternative, it was relying on the original contract signed by the Complainant which included a term “It is entirely at the company’s discretion whether of not to make any payment to you while you are absent through illness. Accordingly, the company may after 3 days of sick leave stop your wages until your return to work and request that you claim your monies from the relevant state scheme”.
The Respondent submitted that the Complainant was aware that it was the company practice not to pay sick leave.
Findings and Conclusions
The Adjudicator was unable to establish that it was custom and practice to pay sick leave for extended periods of more than three days. The Adjudicator found that it was custom and practice to cover periods up to three days, in accordance with the clause contained in the original contract.
The Adjudicator found that this complaint is well founded, and that the complainant has established facts from which that she was entitled to be paid for three days sick leave in accordance with her contract of employment.
Having considered all written and oral evidence presented, the Adjudicator decided to award the Complainant three days pay at €211.54 per day amounting to a total of €634.62.
There is no legal entitlement to sick pay while an Employee is absent due to illness or injury. However, contractual sick pay entitlements are common practice in Ireland, in particular in certain sectors.
In this situation, the employee was with a new contract of employment which amended the previous terms and conditions of employment. The Organisation did not follow up with the employee in relation to her concerns and therefore the new contract was never signed.
Note on WRC:
The establishment of the Workplace Relations Commission on the 1st October 2015 is the most radical restructuring of employment legislation over the last 30 years. Organisations are encouraged to understand all facets of the WRC, how it now operates and what to expect when required to defend a claim at the third parties.
The establishment of the Workplace Relations Commission has resulted in the combined functions of the Labour Relations Commission, Rights Commissioner Service, the Equality Tribunal, the Employment Appeals Tribunal and the National Employment Rights Authority (NERA).
In addition to this the Labour Court has been reconfigured in order to hear appeals.
The strategic aims of the new Workplace Relations Commission include an independent, effective and impartial workplace relations service, a more workable means of redress within a reasonable timeframe and an overall reduction in costs. The new Workplace Relations Commission is also anticipated to be more centralised, in terms of maintaining a database of case information, the end result bring a better service for both Employers and Employees and a much more streamlined, simplified process.
Adare Human Resource Management is one of Ireland’s leading Employment Law and Human Resource Management Consultancies. Our HR & Employment Law Support Services include:
- Advice on all Employment Law, Industrial Relations and HR queries or issues
- Review, Development and Implementation of Contracts of Employment and Employee Policies and Procedures
- Management and Employee Training - Dignity at Work, Anti-Harassment and Sexual Harassment, Conducting Disciplinary Meetings
- Investigations - independent investigations on behalf of Organisations in line with the relevant legislation and codes of practice
- Organisational Management or Change Management Initiatives – including review / development of Performance Appraisal / Management Systems and Organisational Development
THE SAFETY, HEALTH AND WELFARE AT WORK (AMENDMENT) BILL 2020
The Safety, Health and Welfare at Work (Amendment) Bill 2020 is currently before Dáil Éireann, Second Stage and, if enacted, it will provide for a proactive health notification and surveillance. This means that a legal obligation will be placed on all employers and/ or workplace to notify the Health and Safety Authority of any occurrences of Covid-19 in their workplace.
Currently, Covid-19 falls under the immediate preliminary notification to a Medical Officer of Health only under the Infectious Diseases (Amendment) Regulations 2020 (S.I. No. 53 of 2020).
However, under the Amendment Bill 2020, Covid-19 will be classified as an occupational illness and every employer and/or workplace, will have to have regard to the immediate, exceptional, and manifest risk posed to human life and public health by the spread of the virus, and have to report any occurrences of Covid-19 amongst worker(s) in the workplace to the Health and Safety Authority.
While we await the outcome of the Amendment Bill 2020 as it moves through Dáil Éireann, this acts as a timely reminder of the importance of health and safety in the workplace. Despite Level 5 restrictions being in place it is incumbent upon each Employer to ensure a safe place of work. The requirements to mitigate and implement preventative and control measures will once again come to the fore when restrictions are eased. Until then, Employers should ensure the focus remains on mental health support and health and safety in the remote working space such as compliance with DSE and Ergonomic Assessments.
THE EMPLOYMENT WAGE SUBSIDY SCHEME
The Government has also announced that the rate of subsidy provided under the Employment Wage Subsidy Scheme (EWSS) has been revised to better support businesses dealing with Covid 19 Level 5 restrictions.
The result of this is that the rates under the Employment Wage Subsidy Scheme will be aligned with the rates of payment under the pandemic unemployment payment, in the amount of up to €350 per week, effective from the next payroll date after October 19, 2020.
There has also been a change to the criteria for application to the scheme for the purpose of allowing more businesses to access this support. This means that the qualifying turnover criteria for application to the scheme is now 25 per cent of the turnover for the corresponding period in 2019.
Parents Leave Extended
Budget 2021 has proposed to increase Parents Benefit. From April 2021, Parent’s Benefit will be extended by 3 weeks from 2 weeks to 5 weeks for parents of children born or adopted from November 2019.
The period it can be taken will be extended up to your child's second birthday or within 2 years following adoption.