Duncan Inverarity, Head of Employment, A&L Goodbody, was a massive hit at our Annual Reviews of Employment Law in November. In this webinar, Duncan revises what he considers to be the top employment cases of the last year (including any post-November 2021) and sets out learning points and takeaway actions to put into practice.

Join Duncan and Scott Alexander from Legal Island as they discuss the top cases and why they are important to employers in Ireland. Duncan will set out the factual background, what the relevant court decided and what this means from a practical perspective for employers.

In this webinar Duncan discusses the following cases:

• Baranya v Rosderra Irish Meats Group Ltd [2022] IESC 5: https://www.legal-island.ie/articles/ire/case-law/2021/december/baranya-v-irish-meats-group-ltd-2021/

• Donal O’Donovan v Over-C Technology Limited and Over-C Limited [2021] IECA 37: https://www.legal-island.ie/articles/ire/case-law/2021/feb/donal-odonovan-v-over-c-technology-limited-limited-and-over-c-limited-2021/

• Hennessy v Ladbrooks Payments (Ireland) Ltd and Anor [2022] IEHC 60: https://www.courts.ie/acc/alfresco/6c2cf96f-25ae-4123-9f9a-20de9c42bcee/2022_IEHC_60.pdf/pdf#view=fitH

• Sobhy v Chief Appeals Officer & Ors [2021] IEHC 93: https://www.courts.ie/ga/view/Judgments/803c4b08-8803-4f87-9469-8accf9de6c0f/6aff0b6a-2d07-4b5c-a16b-be2448ac9edf/2021_IEHC_93.pdf/pdf

• Robert Farrell v. Modus Link Kildare Unlimited Company [2021] ADJ-00032100 - Temporary withholding of ex-gratia redundancy was penalisation: https://www.workplacerelations.ie/en/cases/2021/november/adj-00032100.html

• Ray Walsh v. Econocom Digital Finance Limited [2022] ADJ-00029093 - Major award for unfair redundancy of finance company manager:  https://www.legal-island.ie/articles/ire/case-law/2022/jan/ray-walsh-v-econocom-digital-finance-ltd-2022/

• Power v Health Service Executive [2021] IEHC 346 - heard by the Supreme Court in January and decision pending: earlier decision from the High Court: https://www.courts.ie/view/judgments/b9ff5ffb-7758-4356-b7bc-c0622241a4ee/8770fe93-bed3-47dd-9fca-ec1e7ad1120e/2021_IEHC_346.pdf/pdf

• John Clarke v CGI Food Services Limited And CGI Holdings Limited [2020] IEHC 368 – https://www.courts.ie/acc/alfresco/5121fb43-b28b-4d3f-9bfd-59e76eac823c/2020_IEHC_368.pdf/pdf#view=fitH

The Recording

Transcript

Scott: Good morning, everybody. Welcome to the latest webinar from Legal-Island. This one is in association with A&L Goodbody. You can see there is Duncan Inverarity looking very like his photo and me not looking very like my photo. Duncan is the Head of Employment at A&L Goodbody. And if you were at the Annual Review of Employment Law in the November, Duncan covered a lot of Irish case law that impacts on employers in this jurisdiction.

And this is a catch-up. Some of the cases were covered before. A number of them are new cases that we're looking at that have happened since the Annual Review. But we will be sending you on links so you can look at those cases, and we'll send you a post-event link and email so you can catch up.

One of the things we'll put in the link is an HR Toolkit. Yes, indeed, the HR Toolkit that's coming up from Legal-Island that was done. And if you have a look at that, you can see that there are different things there, recruitment in the modern workplace, tackling sensitive conversations, which we'll be discussing in relation to the first case, dealing with difficult people, which again [inaudible 00:01:07], and managing performance. So you'll get an email from Debbie and the rest of the team if you want a free demo on how those can help you keep up to date.

Now, we're going to be looking at a number of cases today. We've got six cases and a quick update. If you have any questions, drop them into the question box. You can see it there on your right-hand side. And we'll deal with the questions near the end.

I had one in by email this morning, Duncan, about Baranya. So that's the first case we're going to be looking at. It's a whistleblowing case. Maybe you could update us because we had the amendment bill, the Protected Disclosures Amendment Bill 2022, published yesterday, which amends the 2014 Act and it has an impact on this case.

So could you give us a little bit of background, why it's important, and then we'll look at what employers should do as a result of this case?

Duncan: Yeah, great. Thanks, Scott, and morning, everybody. Today, it's an opportunity to update on some recent case law, particularly since the Annual Review. There have been a few cases that I think it's worth mentioning and bring to your attention.

Indeed, the citation there for Baranya case is a little bit of a cheat. It is a 2022 decision, but that's in relation to the cost aspect of this case, which is also interesting, and I'll touch on that.

But this case is all about the whistleblowing, as Scott's alluded to, and what constitutes protected disclosure. And why is it important? It's important for a number of reasons.

First of all, it's a Supreme Court decision on the whistleblowing legislation, so that in itself should pique people's interests. But it's about . . . just to give you some facts, because facts always help explain the principles of the decision.

Mr Baranya was a meat process worker in Rosderra Meats and had service less than 12 months. So when people have less than 12 months' service, one tool they have in their arsenal is to take a case under the protected disclosures legislation. I'm not downplaying the veracity of Mr Baranya's complaint, but that does give some colour to why it's a protected disclosure case.

In any event, Mr Baranya complained to his supervisor that a particular aspect of his job he couldn't do because he was in pain. Now, what's really interesting about this is what did he actually say to his supervisor? Did he say, "I can't do this work because I'm in pain because of the job I do", or, "I'm in pain"? So he has to try and relate it to his employment.

So this is a process worker, and we're in the Supreme Court deciding on what did he actually say to his supervisor. So it's interesting in that respect.

In any event, he was dismissed three days after making this complaint. Went to the WRC, and the WRC said, "No, this is a grievance, not a protected disclosure". He went to the Labour Court. Labour Court agreed with the WRC. Went a little bit further, looked at the Code of Practice on whistleblowing, and said, "The Code of Practice says a grievance is not a protected disclosure. Therefore, it is a grievance. It's not a protected disclosure".

He then appealed it. Again, I always find these things really interesting because meat process worker is appealing all the way to the High Court on a point of law. And the High Court said, "No error of law". Looked at the Code of Practice, no error of law. And then it was appealed to the Supreme Court. It had leave to appeal to the Supreme Court, so it's getting pretty toppy in terms of the consideration of these particular issues.

Got to the Supreme Court, and the decision at Supreme Court was delivered by Mr Justice Hogan. And if anyone has ever been involved with Mr Justice Hogan or read his decisions, they are gems. It is worth the read.

The way in which he expresses principles and set out very complex legal principles is an incredible skill, and this decision is no different to the way he's approached these issues in the past.

In any event, what the Supreme Court effectively did, just to give you the spoiler, was to allow the appeal. He allowed Mr Baranya's appeal, and he allowed it on a number of grounds. And he said, "Look, the ultimate question here is can a complaint about an individual situation amount to a protected disclosure?" And the answer to that is yes.

And he distinguished between . . . So if you look at the Protected Disclosure Act, it says, "If it's a matter about your contract of employment, then that is not a protected disclosure". And Justice Hogan said, "Well, that's not quite right, and that doesn't make a lot of sense to me".

So he gave an example of if someone makes a complaint under the Payment of Wages Act that I'm not getting paid my wages, that is a protected disclosure. But if it's a complaint under your contract that I'm not getting paid my wages, that's not a protected disclosure, according to the legislation.

So he said, "That doesn't make any sense to me". And he said, "Take it a little bit further. This is about health and safety". The language he described is extremely broad in the Protected Disclosure Act under relevant wrongdoing, that if there is a complaint about health and safety for any individual, so that means an individual complains about health and safety, that must be a protected disclosure.

So he also looked at the Code of Practice and said, "Look, God love the Labour Court. They were given a lemon". The Code of Practice is a misstatement of the law, and the Code of Practice cannot circumvent the law, cannot supersede the law, which is the 2014 Act.

So he was quite critical of the 2015 Code of Practice because it introduces the concept of a grievance. He said, "The word grievance is nowhere to be seen in the 2014 Act", and he's dead right. There is no grievance reference in the 2014 Act. So he said, "The Code of Practice is misleading, so the Labour Court started from the wrong premise and finished at the wrong premise". What he did is he remitted the entire case back to the Labour Court.

So he said effectively that the Labour Court was in error because they followed the 2015 code. But secondly, they didn't find or make conclusions of fact, and this goes back to the conversation that was had.

So two things have to happen for this to be a protected disclosure. One, Mr Baranya has to be a worker. We can tick that box. I think we're fairly satisfied of that. The second is that it has to be a relevant wrongdoing. And this is where you have to look at what did he say. Did he attribute it to his work? But Justice Hogan goes a little bit further to say, "Anyone who makes a complaint to say, 'A job hurts me', is basically saying it's a health and safety issue". You don't really need to go and say, "This hurts me because I'm a worker or because I'm working". So he kind of made that distinction as well.

It's gone back to the Labour Court and we're yet to see what happens as a result of this.

So it's a really interesting decision insofar as the Supreme Court considering what does constitute a protected disclosure. And a lot of people, me included, would operate on the basis that an individual grievance is not necessarily a protected disclosure, and he's saying, "That's not quite right".

Just to finish up on that case, there was the issue of costs. So the cost would have been chunky. We're talking about the High Court costs and Supreme Court costs. And again, from a practitioner's point of view, it's interesting there was a change to the rules of Superior Court in August 2020, which basically said that any appeal to from a Labour Court on an error of law point, there will be no costs allowed unless there are special considerations.

So there's this other judgement all about the costs issue. And to cut to the chase, the Supreme Court said, "There are special considerations because it was a very important issue that had to be considered". And it was considered in Mr Baranya's favour, so he got his costs for the High Court and the Supreme Court. He did well at the end of the day.

I wonder what would have happened if he'd been unsuccessful. I don't know that costs would have been awarded against him. So all the planets aligned for Mr Baranya and he was successful.

It's gone back to the Labour Court. One would imagine the Labour Court are going to find that there was protected disclosure. But then, of course, they have to go on and say, "Was he dismissed as a consequence of this protected disclosure?" And this case is quite old now in terms of when the dismissal happened.

So the other thing I wanted to mention, and Scott touched on this, is the whistleblowing . . . the bill, which has come in, which is published. And there is a provision in there that says that issues of personal conflict are not to be considered a protected disclosure.

I think the obvious question is that change to the current legislation, do we think that's going to affect the outcome of this decision or the effect of this decision? I think the simple answer is no, I don't think it will, because Section 5(3)(d), which is the health and safety provision, was not amended. So it will still be good law.

And if you look at the proposed amendment, it's really about interpersonal conflicts, not about health and safety issues.

So I do think the bill will have a material effect on grievances and whether grievances are protected disclosures, but not necessarily when it comes to health and safety issues.

Scott: Yeah, that amendment there, just reading it now, says, "A matter concerning interpersonal grievances exclusively affecting the reporting person", and it goes on to talk about exclusivity twice. It does mention grievance, so at least you've got grievance back into the legislation, or you will have once the original act is amended.

Just on that question that came in earlier, Duncan. It seems to me that . . . The question was should public sector . . . Once it's brought in, any organisation with 250-plus employees presumably, or anyone covered by this act, should they more or less log pretty much any complaint that isn't about an individual contract or an individual grievance or a dispute between two employees? Pretty much anything might be a protected disclosure now.

Duncan: Yeah, it's good question. It still has to be a relevant wrongdoing before it's a protected disclosure. As I said before, as Justice Hogan was saying, you've got to be a worker tick, but it's got to be a relevant wrongdoing under Section 5 of the act. So it still has to come within that broad church of a relevant wrongdoing before you would have to log it.

And employees, which is absolutely clear from the jurisprudence and it's [inaudible 00:11:41] in the legislation, don't need to stick their hand up and say, "I'm making a protected disclosure". It's used more as a shield than a sword. So if you are to be terminated or penalised, and that's a far broader concept now under the bill, then you say, "In retrospect, I did make a protected disclosure". You don't need to lead with a protected disclosure, but you can use it certainly as a defence in terms of any penalisation.

Scott: Okay. Well, let's move on because time is tight today. A case that you've looked at before is O'Donovan v Over-C Technology. Give us a quick summary of the background and why this is important, and indeed, what employers should do next as a result of O'Donovan.

Duncan: Apologies to those who were at the update, but I just think this is probably one of the seminal cases of 2021, just worth mentioning again. And it remains obviously good law now.

Just very briefly in terms of the facts and what this is about. Again, it's a case involving someone with less than 12 months' service. Mr O'Donovan was a financial officer in Over-C Technology. He started I think in August 2019 and was dismissed in January 2020. He was dismissed on performance grounds.

He had a contract of employment, which entitled him to a disciplinary procedure to include an appeal, and he was subject to a probationary period. So all the normal things that you would expect in a contract of employment.

He was called to a meeting in January 2020 and told that because of his performance, he was being terminated, and he hadn't passed, effectively, his probationary period.

He appealed that decision, which he was entitled to do pursuant to his contract. And then when the appeal was organised, he wrote in saying, "Look, my lawyers can't make it and I have some issues about the procedures that you've adopted". So the employer summarily wrote back and said, "We note you've withdrawn your appeal. I'm affirming the decision to dismiss". So it wasn't great in terms of the way in which they treated Mr O'Donovan.

So I guess, unusually, Mr O'Donovan went to the High Court to seek injunctive relief on the basis that he had been denied fair procedures. So this case is all about are you entitled to fair procedures during your probationary period where you are dismissed for performance-based reasons? Short answer: No, you're not. You're not entitled to the procedures.

Now, why is this important? It's phenomenally important because it fundamentally overturns the way we have all thought since the case of Naujoks, which was a decision of Miss Justice Laffoy. We always operated on the basis that even without performance-related dismissal, you're entitled to fair procedures.

It went to the Court of Appeal, to the High Court, which agreed effectively with Mr O'Donovan, and then went to the Court of Appeals. So the employer appealed it to the Court of Appeal.

The Court of Appeal, at once highly critical of Miss Justice Laffoy and the Naujoks decision, effectively overturned that decision and said, "If it is a performance-based dismissal, you do not need to apply fair procedures. But be warned, if it is misconduct-based or alludes to misconduct, the chances are you will need to apply fair procedures".

And what the Court of Appeal said is, "What is the point of a probationary period if you cannot terminate someone for performance reasons?" So from a common sense point of view, it makes an awful lot of sense. If it's a performance-based dismissal, you do not need to apply their procedures. And as I say, it's a fundamental departure from Miss Justice Laffoy's decision in Naujoks. So that's why it's important.

And it does change the way in which employers should be dealing with employees on probation and employees who have performance-related issues, and termination of their employment based on those performance issues.

So what the Court of Appeal is saying is during probation, you can terminate for any reason or no reason, apart from misconduct, because that just automatically attracts fair procedures and their constitutional rights.

So, as Scott said, what are the key takeaways? I think there are a number of key takeaways. First of all, you need to know that. You need to know that you don't have to apply fair procedures for a performance-related termination during probation.

The second issue is you need to make sure your contracts are fit for purpose if the contracts call that out, that on probation you can be dismissed for any or no reason, and that the disciplinary procedure will not necessarily apply to you during your probationary period where it's a performance-related issue.

So it's really important. You do need to have a look into your contracts or amend them, or for new starters, you need to put that in for those who are on probation.

So it certainly makes it . . . probably the wrong way to put this, but a lot easier for employers to terminate employees on probation where there are performance reasons. To use other reasons other than performance could get you into difficulty, because that still does attract fair procedures.

Scott: I suppose at the moment where there's such a high turnover of staff, you're going to have a lot of people on probation. So it's more important as well.

Both of those cases, Baranya and O'Donovan, require employers to assess situations. So the first one is saying, "Do I assess this as a valid whistleblowing complaint, or is it a normal individual grievance?" And in this one here, you're saying, "I'm looking at somebody and how they're working. Are they intentionally doing something wrong?" In which case it's misconduct. "Or are they just rotten at their job, or not good enough, not meeting our standards?" In which case you would have to phrase those complaints in a certain way. Otherwise, you're going to get caught by constitutional rights.

What about Hennessy then and Ladbrooks? What's that case about and why is it important?

Duncan: Just on the Baranya, I don't think Rosderra Meats had any consideration to whether this was protected disclosure. They just sacked him, and then he came afterwards and said it was a protected disclosure. So I don't think they turned their mind to protected disclosures at all, and then they find themselves in the Supreme Court years later. That's a lesson in itself.

The Hennessy case is interesting. I'm going to stop using the word interesting, but you can make up your own mind whether it's interesting. I think it's interesting for a number of reasons, one of which being I think this is Miss Justice Bolger's first decision.

And those who are in this game would know Marguerite Bolger well. Would have briefed her, would have been against, would have got advice from her. She's a fantastic practitioner in the area of employment law. So it's great to see an employment law barrister now on the High Court, and I think this is probably her first decision. So it is a very recent decision, a decision of Miss Justice Bolger.

So what is it? It's an interlocutory decision, where Ladbrooks actually took an application to the High Court to effectively stop Miss Hennessy from taking proceedings against them. And those proceedings were for personal injury. I must say, personal injury proceedings are not the most exciting proceedings, but this decision touches on three areas, which I think are worth discussing.

As I say, they tried to dismiss the proceedings, and they tried to dismiss the proceedings for three reasons. First, she'd signed a compromise agreement, which is particularly relevant to employment lawyers. The second is that there was a statute of limitations which applied. And the third is that she had failed to prosecute her case, so for want of prosecution, which is the legal term.

Just to give you some facts about what this is about, it's a woman Philomena Hennessy who worked for Ladbrooks. She was a customer service manager and she started working for them in 1998. So she's quite long-serving. She was made redundant in August 2015. And, like most employers, she was required to sign a compromise agreement in order to get an ex gratia payment.

Now, the compromise agreement, let's say it was in the usual terms, which sought to compromise all claims that she had or may have against the employer.

 About 12 months later, I think it was 8 or 9 months later, she lodged a PIAB application, which turned into a personal injury claim. And so this proceeding, this interlocutory application was all about the personal injury claim because she'd been long gone as an employee.

So as I say, they tried to knock it out, dismiss the proceedings on the basis of the three reasons I gave you.

Miss Justice Bolger analysed each of those three issues, the first being the compromise agreement. Did the compromise agreement bring this to a rapid end? The defendant said this was their absolute defence. It's unanswerable. The compromise agreement is unanswerable, which always makes me worry if someone says it's unanswerable, because, of course, it's answerable. It's not as certain as they thought it was.

And when I'm looking at the compromise agreement, one of the takeaways here is you need to look at your compromise agreements before you get someone to sign it. But as I say, it's not an unusual compromise agreement. It had a couple of things saying for any claims, which you've communicated to us in writing, such as a personal injury action, you give a warranty that you don't know of any circumstances which would give rise to a personal injury claim, that type of stuff. That was in the compromise agreement.

But when you look at what actually happened to Miss Hennessy and what happened at the time she signed the compromise agreement, she says . . . So the compromise agreement says that, "I have taken legal advice". No ifs, buts, or maybes. "I have taken legal advice". So they relied on that.

Now, you know where this is going to go pretty quickly. The difficulty is she didn't take legal advice. They didn't tell her to take legal advice. They didn't advise her to take legal advice. And she didn't take legal advice. So none of that happened.

She said, "It was put under my nose saying, 'These are the terms. We're not negotiating. Take it or leave it. If you don't take it, we're going to make someone else redundant. So you're going to lose your ex gratia payment'."

And Miss Justice Bolger said, not surprisingly, "There's no informed consent here. There's none, because she didn't take legal advice. She didn't know she had to take legal advice". She cited a number of cases, which wasn't very useful. But there's a massive inequality of bargaining power here between Miss Hennessy and her employer, and that there is an implied condition in the employment contract of mutual trust and confidence. And that this was not discharged in this example, because they just went through a process and they didn't advise her properly about what she should do. She didn't take proper advice or any advice at all.

So of the three reasons, this was the one she was most critical of in terms of whether or not it was an unanswerable defence. She said it's totally answerable, because she wasn't afforded any proper advice in terms of her consent to waive any claim.

The other thing that was apparent was there was absolutely no correspondence setting out this potential claim. So the fact that the agreement had referred to this in circumstances where it didn't make any sense did trouble her as well.

On the second issue on the statute of limitations, she was a bit more sanguine, and she said, "Well, look, that's going to be a matter of evidence. It's going to be a matter of medical evidence, which can be interrogated and cross-examined. That's a matter for the trial judge, so don't really need to decide that, but it's not enough on its face to strike it out".

And then on the delay point, she again didn't buy that argument. They said the delay goes back to 2009 when she says she first had an injury. And she didn't do anything in 2009 to 2016. And then there were three other periods of delay that they say meant that she wasn't prosecuting this case, for want of prosecution. Again fell on fairly deaf ears with Miss Justice Bolger.

She made some fairly absolute statements saying, "I don't find this to be inordinate delay despite the fact that there is a significant period of time". The fact they reached back to 2009 touches on the statute of limitations piece, because she's saying, "Well, the injury didn't really become apparent to me until 2014". So there's five years of inordinate delay, which is highly debatable and you could probably take way.

The other thing which was really interesting . . . She, again, referred to case law about the delay of the applicant to interlocutory proceedings, the delay of the company in not bringing this application earlier. You knew in 2019 that you had this significant delay. Yet you waited until 2021 before you brought the application.

So when practitioners are thinking about striking something out for want of prosecution, you can be criticised for going to soon, but you can also be criticised for going too late. And this was one of those cases where you're criticised for going too late.

But again, she said, "Look, this is a matter for the trial judge". She said, "I can't see that there's any prejudice. The engineers went in and inspected the workplace, so you've got all the inspection documents".

If you, I suppose, trashed the building or reorganised the building, then maybe there's prejudice here, but there's none of that. So you've got documents, you've got people still around, they didn't give any evidence whatsoever that there would be severe prejudice or that there would be an unfair administration of justice. So she wasn't satisfied, but it's a matter for the trial judge.

So for all those reasons, the company failed. But I think the takeaway from us as employment practitioners is particularly the compromise agreement. So if you are going to . . . We're getting closer the English system, it seems to me, where you must have legal advice. At the very least, you must be giving people the opportunity to take legal advice. But when you have agreement saying she has taken legal advice, which is clearly wrong, then you're going to fall into significant problems.

And the way you can confirm that they've taken legal advice is you get a solicitor's fee note. That's the way in which you prove that they've taken legal advice.

So again, while they say it was an unanswerable defence, you kind of knew where this was going early doors. Anyway, there's lot there that they should have done with it.

So I'd say compromise agreements are still good, but they have to actually reflect what happened in truth, which didn't happen here.

Scott: Thank you very much, Duncan. So how strong a waiver. The theme going through all of those folks for me is that employers have to look at their procedures and their processes. And in the case of a waiver, make sure that somebody is advised properly and that you've got evidence that can stand over those things. Otherwise, it's maybe not as strong a waiver as you think, or strong a compromise agreement.

Duncan: Well, arguably not worth the paper it's written on, Scott.

Scott: Yeah, it might still be a terrible claim, but you're not going to be able to block it at the waiver stage.

Folks, you're listening to Duncan Inverarity from A&L Goodbody. He's looking at case law. And we're now going to look at three other cases. We've loads of questions and, Duncan, so if it's okay, we might extend the webinar for a few minutes after to look at some of those questions and run through those.

Folks, if you can stay around until 12:00, that's great. We'll finish it at 12:00 with the updates. But we'll move and deal with questions at the end and I'll try and run through because there are dozens and dozens of them. So we'll try and get through some.

So what about the Sobhy case? I don't know if that's how it's pronounced. But what about Sobhy v Chief Appeals Officer? What's that about?

Duncan: Again, very recent decision, December last year, Supreme Court decision. The reason I stuck it in in the employment sphere is it's a case about an illegal worker, an illegal employment contract, and what does that mean? What's the effect of the illegality of the contract?

It's, again, quite a very interesting Supreme Court decision, which is really important to take note of and consider.

So Miss Sobhy was a Mauritian national. She was a chef. She came to Ireland in 2008 on a student visa, and she worked . . . In accordance with that visa, she was she was allowed to work 20 hours a week. She did all that good stuff. But between 2012 and 2016, she worked illegally. She did not have the appropriate work permit.

Probably bizarrely, she had a contract of employment, which no one complained about, apart from the fact that it was fundamentally illegal. But the contract itself wasn't bad. She paid PRSI and she paid tax. So for all intents and purposes, she was a contributing member of society. And when I say contributing, contributing from the USC, PRSI, tax point of view.

I think it's hysterical that no one picked up the fact that she didn't have a work permit. Revenue were just happy to take the tax, social welfare were happy to take the PRSI contributions, but no one twigged that she was illegal.

So she fell pregnant and she was going off on maternity leave in 2018. Again, bizarrely, her situation was regularised in 2019, so she did have a work permit by that time. But all the PRSI contributions she made for the purposes of social welfare, to include maternity leave, were made on foot of an illegal contract. So this is the issue.

She made application for her maternity pay, her statutory pay. The department said, "No, you're not going to get it because it's based on an illegal contract". Went to a chief appeals officer. He agreed with the decision of first instance.

Went to the High Court by way of judicial review, and the High Court adopted a fairly maternalistic view, I suppose, and said, "Look, it's an illegal contract. We need to be flexible. It's not as straightforward as illegal contract, and therefore illegal claim for maternity leave". And they overturned the decision of the chief appeals officer.

And then the respondent appealed, so the government effectively appealed to the Supreme Court.

So really important case, because we're now talking about the illegality of a contract and what does that mean. What's important to distinguish here is between the rights of an individual pursuant to a contract and the rights of an individual pursuant to a statute. And that's where she failed, because this is rights pursuant to statute.

So what the Supreme Court said . . . they looked at a number of cases, and they had a really, really good deep look at the case of Hussein v The Labour Court. And for those who remember that, another decision of Mr Justice Hogan, where Mr Hussein was a chef in a Chinese restaurant. It was in Ranelagh or something like that.

Worked for his brother or a family member, which I think always gives these things colour. In any event, they didn't pay him. They did not pay him. He had a contract of employment, but they just never paid him.

So it went to the Labour Court and then went to the High Court, obviously, because Mr Justice Hogan looked at it. And he said, "This is outrageous. It's exploitation of illegal workers. The employer is getting all the upside and there's no downside, but the employee doesn't get any pay. But I can't do anything about it".

Now, as a result of that decision, there are a number of legislative changes made to allow employees on illegal contracts to get some benefit to ensure that they get paid.

So Mr Hussein, had he had taken this case again, he would have been paid. And there were some other changes in terms of insolvency legislation and so on. So employees who were on the wrong side on a contractual basis had some level of protection notwithstanding it was an illegal contract.

But the Supreme Court said that is fundamentally different when it comes to statutory entitlements . . . statutory benefits, not entitlements. It's not like annual leave and so on, but statutory benefits.

And they said, "Statutory maternity pay is something completely different and separate from your employment". So in order to attract a statutory maternity benefit, you have to have a contract for service. That is a fundamental principle to get that benefit. And if it's an illegal contract, you do not have a contract for service. Therefore, if you do not have that precondition to the payment, you can't then get the payment. So she was unsuccessful.

And as I say, the massive distinction is between contractual benefits and statutory benefits. So if the precondition is a contract and you don't have a contract, you do not get that salutatory benefit.

It has nothing to do with the exploitation of workers. It has nothing to do with exploitation of illegal workers. It's a benefit that everybody in the state gets, provided they make PRSI contributions and have a contract for service. So she was unsuccessful.

Ironically, all the PRSI contributions were refunded to Miss Sobhy, but they didn't come near what she would've got with the statutory benefits. So it's an unfortunate decision for Miss Sobhy, but I guess it makes a lot of sense.

Now, they were very sympathetic to her and all the good stuff. And they went through in absolute detail about the exploitation of workers, and how wrong it is, and it shouldn't happen, and so on. And they said, "But if we let her through, we're going to be encouraging illegal contracts. And that's not what we are going to do". And they said, "Look, the legislature should have a look at this". A bit like Hogan in Hussein. He said [inaudible 00:33:49].

So illegal contracts will not guarantee you statutory benefits. In fact, it probably means you won't get statutory benefits.

Scott: Okay. And what about the next case, Farrell v Modus Link Kildare Unlimited?

Duncan: Just on these two reasonably quickly, they're both WRC cases. So we're going from the Supreme Court to the WRC, but for those practising in this jurisdiction, obviously very important.

The case of Farrell, quickly, he was made redundant in August 2020 along with 13 other people. So it wasn't a singleton redundancy. There was no real question about the redundancy.

Not dissimilar to the PIAB case we discussed earlier in Hennessy, but there was a compromise agreement. The compromise agreement precluded him from taking any personal injury claims.

He was made redundant in 2020, but in 2019, prior to this, he had issued the PIAB claim. There were PI proceedings on foot. And because he wouldn't sign the compromise agreement, which happened after he'd lodged his PIAB claim, he effectively left his ex gratia payment behind, and that was 51,000-odd euros, which was significant money for Mr Farrell.

And it was an absolute. This agreement said, "You don't sign that agreement, including your PIAB claim or your PI claim, you don't get the money". So he walked away from the money.

Where's this going? He took a penalisation claim under the Health, Safety, and Welfare at Work Act. That's what this claim is about. So he's saying, "I took a claim because I was injured at work, and I'm being penalised under that legislation because you are withholding my ex gratia payment".

And effectively, the WRC agreed with that and said, "You can't do that. It is a claim. It is a health, safety, and welfare issue. You cannot expect people to waive their claims or compromise their PI claims unless, of course, they agree. And if they don't agree . . ."

There was no question that but for this PI claim, he would have got the €51,000 ex gratia payment. It's almost like as night follows day. If you withhold that because of his PI claim, then that is penalisation.

Now, interestingly, the company seems very amicable. The company were more than prepared to pay him the €51,000. And they said, "Look, we'll remove that obligation and we'll pay you the €51,000". But then it all fell apart because they couldn't agree on what the PI settlement was going to be.

So it still seems that he's going to get his €51,000 when his PI claim is resolved. But what did he get? The award for the penalisation was €5,000. I think that's with one eye on the fact that they had given an undertaking to pay the €51,000 at some future time.

So again, interesting case insofar as penalisation under the Health, Safety, and Welfare at Work Act, because you withheld an ex gratia payment for no other reason than he had a PI claim.

Then the second case of Walsh v Econocom, that's a case . . . interesting because the number of comments made by the adjudication officer, which, I must say, I personally have difficulties with. But what's the case about? Again, it's another redundancy case. He was made redundant in April 2020. And he was made redundant during a Teams call, where the HR director and the CEO are on the call saying, "Sorry, you're made redundant". There was no consultation. There was no consideration of alternatives.

He requested enhanced redundancy and that was just simply refused out of hand at the time. There seems to be some debate on evidence about the company said, "Look, if he'd asked for it, we would have given it to him". And he said, "I asked for it and they didn't". And the adjudicator I think described that as troubling. I don't know why it was troubling, but people differ in terms of recollections.

Anyway, what did the WRC say? The WRC said this is a genuine redundancy. There was no question that this is a genuine redundancy, but that's not the end of the matter. Because under the Unfair Dismissal Act, you do need to still apply fair procedures, because you still have to have regard to the conduct of the employer.

So what does it mean? It means the employer has to apply fair procedures to discharge that conduct requirement. And they didn't do that because they didn't give notice to the meeting. They didn't give him right of representation. They didn't give him a right to respond to the decision to make his job redundant. And they didn't give him a right of appeal. So I think that's pretty clear they didn't do any of that, notwithstanding that it was due to a redundancy.

Then the second aspect of what they looked at was there were no alternatives. You did not consider any alternative employment for this guy. Now, that should be the end of it in terms of fair procedures, because that's probably right. But then the adjudication officer went on to say, "Sure. He probably could have done another job, even on a part-time basis". Almost stepping into the shoes of the employer. Said, "Why didn't you extend his notice period? Why didn't you give him some compensation? Why didn't you give him an ex gratia payment to avoid all these proceedings?"

That, to my mind, just goes too far from an adjudication officer's point of view. Once you get to fair procedures, that's it. You don't need to then step in the shoes of the employer. So the impression you get is she just didn't like the employer and the way in which he was treated, which I think is probably right. But then to jump into the shoes of the employer and almost make the decision for them is wrong.

So he got a year's salary, which is about €120,000. So it's a substantial award. There's no discussion there about, "Did he mitigate his loss?" and so on. So it would seem to be that he did and was entitled . . . Sorry. That there was no discount for the mitigation piece.

Takeaway from this is pretty obvious. Even in a genuine redundancy situation, even though the act says it's an absolute defence to termination, you still need to apply fair procedures. That's the pretty simple outcome.

I don't know if that's going to be appealed. I mean, a lot of what the adjudication officer said I think just goes way too far. But who knows?

Scott: We will find out.

We have a couple of minutes left. You have a couple of quick things you want to update the audience with and then we'll move on to some Q&A.

If you have to leave, folks, that's okay. We're recording this and it will be turned into a podcast as well.

But the two-minute update, here you go. Power v Health Service Executive and John Clarke against CGI Food Services. What are these cases about?

Duncan: So Power v Health Service Executive, it's a fixed-term contract case where Mr Power is employed by the HSE, was on a fixed-term contract. The argument was, or is, from the HSE that unless you are coming from the outside in, a fixed-term contract does not apply to existing employees. And that was basically knocked on the head, and Mr Power has been successful to date, which says that a fixed-term contract applies whether you are employed by the one employer or coming from the outside.

The reason I've got it here as a two-minute update is that has just recently been heard in the Supreme Court and just awaiting a decision. So just be on the lookout for that. I'm sure we'll be issuing in a letter once it does come out. But again, that's just my way of update because that, I think, will be a very important case for us all, not just those involving . . . It's not just involving the public sector.

And the second case is Clarke v CGI Foods. This is a phenomenal case in that this goes back quite some time. What this was, Mr Clarke was the subject of a performance review. Mr Clarke was dismissed. He says, "I was dismissed because I raised a whole bunch of issues which are protected disclosures".

He did go to the Circuit Court, get an injunction pending the WRC hearing. He was successful. So he was paid on the foot of that injunction. CGI foods appealed to the High Court. The High Court agreed with Mr Clarke. So CGI Foods were unsuccessful. He has been paid his salary the whole time.

As a result of the High Court, CGI Foods were referred to the Department of Agriculture, to the Revenue Commissioners. They had a really bad time of this on foot of Mr Clarke's proceedings.

Anyway, this finally got heard by the WRC. I think it was a couple of weeks ago. Very, very recently. So Mr Clarke had been paid for 32 months because of the injunction that he got from the Circuit Court. So he far outstripped any award that he could have got from the WRC. He got to the WRC and withdrew his case.

Now, on one view, it's a genius move from Mr Clarke's point of view, because if Mr Clarke was ultimately unsuccessful in the WRC, there was certainly an argument that he would have to pay back the 32 months, and he was never going to better that in the WRC. So what's the point of a WRC hearing in those circumstances?

So a word to the wise that this whole process . . . Again, we have the bill that Scott has alluded to before. When we have this whole process and we are broadening the scope of who is going to get protection from the whistleblower legislation, we have this prospect of an injunction pending the outcome of a WRC hearing, which could take some time to come to fruition.

I'm sure that's not what they intended, but it's just a warning to everybody that if they get this injunction and the WRC takes some time, you can see what happens. So Mr Clarke got 32 months, which is more than he was ever expecting. So that's just a very quick update on that.

Scott: Okay. So watch out for folks and take advice if you have an injunction against you. You might want to . . .

Duncan: Sorry, one other thing to say on the Clarke. CGI Foods issued a press release after he withdrew. There must have been some agreement to allow him to withdraw because they were at risk also of an adverse fine. But they issued a press release and they said it cost them €500,000 to defend this and to pay him. So it's a fairly expensive unfair dismissal.

Scott: It's pretty expensive indeed. Okay, folks, we're actually at the end of the webinar, but there were so many questions. If it's okay, Duncan, we'll keep you on. If you have to leave, folks, that's all right. We're recording the whole thing, so you can catch up with the last few minutes if you go to Spotify and other places. But let's have a look at some of the questions that we have here.

Let's move on. "Has the seminar started?" Yes, it has.

What's the name of the case in August involving costs?

Duncan: It's on the slide. Baranya and Rosderra Irish Meats, 2022.

Scott: Duncan, so are we saying any grievance once deemed a relevant wrongdoing is a protected disclosure? An example: The employee sets grievance that he or she isn't receiving rest breaks. Would that count as a protected disclosure?

Duncan: Yes, according to Mr Justice Hogan because rest breaks are under the Organisation of Working Time Act. So Justice Hogan makes that distinction. There's no question that a statutory entitlement can mean a protected disclosure, even on an individual basis.

Scott: On probation, can you just bring someone on probation into a meeting and say they're not being made permanent because of their performance?

Duncan: Arguably, yes. I don't want to be too binary about this, but that's kind of what Over-C Technology says. Provided you don't go and say, "Performance and the fact that you're late every morning". Performance has to be objectively, "You're just not good at your job".

Scott: Yeah, and it's nice to have some evidence in case somebody does challenge it and say it was for another reason, which has happened.

Duncan: So when you're having a performance review meeting . . . Say it's a six-month performance period. After three months, you say, "Look, you're not performing at your job and the way you spoke to the managing director was probably suboptimal", or something like that. You start to introduce conduct and you give someone a hook to grab onto in the event that you do dismiss them later on. So I just think you need to think about how you manage the performance reviews and what you do about that.

Scott: Presumably the alternative is you just go through a procedure with every case, and that seems a reasonable thing to do. Even if I've not been a great performer, I might be able to argue, "Yeah, but my managers never trained me or I didn't receive this, and you promised me you'd do that, and give me a bit more time". If you were getting dismissed, you might want something like that.

Duncan: The other [inaudible 00:46:51] about Over-C Technology is we're talking about probationary periods. And I haven't got an answer to this question, but I'm just going to pose it to people. What about after probationary period but before the 12 months and you dismiss someone for performance?

So the Court of Appeal was quite influenced by the fact this was a probationary period dismissal. But you still have a situation where beyond probation, before the 12 months, you want to dismiss someone for performance, do you still need to afford them fair procedures? Arguably no, because if you look at their reasoning, the probationary period shouldn't affect that because performance does not attract constitutional fair procedures. To me, that's decided. And that wasn't decided by the Court of Appeal.

Scott: Yeah, there's a question in here about someone is promoted internally and they go onto a three-month probation period for a new role, but fail to perform. Would they have to follow a fair procedure? Presumably, they've got unfair dismissal rights, albeit it's a performance dismissal, if they're there over a year.

Duncan: Yeah, they definitely would have unfair dismissal rights if they're there over a year. I certainly wouldn't be relying on . . . I wouldn't be as effusive in my following the Over-C Technology decision if it's a new probationary period.

To be fair, it's unusual that people go onto new probationary periods. Usually if you are on a probationary period from a substantive position, you might revert back to your old position as opposed to losing your job. That's not a great bargain for that individual employee if that's what they agreed to. But I think you need to tread very carefully on that one.

Scott: There's a question here about should you extend probationary periods as long as possible to make the best use? But of course, that's going to be limited to six months shortly under the Transparency Directive, isn't it?

Duncan: It is.

Scott: So six months basically will have to be objectively justified, presumably.

Duncan: Yep.

Scott: I'll miss that one again because I think you've covered it. On compromise agreements here, are you saying you give the compromise agreement to the employee in advance, give them timeframe to get advice? And if so, what is a reasonable timeframe for an employee to get advice on a compromise or a waiver clause?

Duncan: Yeah, absolutely. They need to get advice. Absolutely you need to give it to them in advance. I mean, there's no point in terminating and giving it to them and demanding they sign it there. I mean, I know that's not the suggestion, but that's an extreme example of there is no informed consent there and they can't get advice.

What's reasonable depends on a number of circumstances. I would personally say probably a week. A week would be a reasonable period of time, depending on when they get the agreement, depending on the circumstances, the availability of a lawyer. Also useful to give the employee three or four names of lawyers to consult. I'll always find somebody. But I'd say a week would be reasonable.

Scott: Yeah, in the UK, a lot of employers would actually just pay for the legal cost of a consultation.

Duncan: Well, they do in Ireland as well, because the only way you're going to ensure that they get legal advice is if you pay for it or contribute. So it's a contribution to legal costs. You'd never say, "[inaudible 00:50:09]", because that's a bit of a blank cheque. So it's a contribution to legal costs.

Scott: Yeah, that question just came up as well about those. For a conduct-related dismissal during probation, is best practice to complete the full disciplinary process regardless as to whether the contract states the disciplinary procedure will apply during probation?

Duncan: Yes, because the constitutional right to fair procedures for misconduct-type dismissals applies irrespective of contract. It applies from day one. And that's why you'll find employees who have less than 12 months' service going to the High Court, although an expensive and sometimes nuclear option, as Mr O'Donovan found out because he was ultimately unsuccessful with a big costs bill. But yes, you should follow fair procedures.

Scott: We have a question here about redundancies, which ties in with the comments from the adjudication officer. Do organisations now need to consider positions outside the limitations of an employee's role where a redundancy situation exists? So these alternatives, should you really be looking at things that are not related? I can do an admin job, but I'm a manual worker. Should I be offered an alternative job as an admin worker? That type of thing.

Duncan: There's no requirement that you offer an alternative job. There is a requirement that you look at alternatives. Now, that doesn't mean you go and construct a job or make up a job. What that means is you look at alternatives. Usually, it's on what jobs are available in the company at that particular point in time, via an intranet or a notice board, a job notice board, or whatever. That's the extent to what alternative solutions should be.

Particularly with multinational companies and in the case that we talked about, Mr Walsh offered to go overseas because he spoke Italian and Spanish. And they didn't even look at that.

So it's up to the employer what they want to do, but what they need to do . . . And it's not just taking a [inaudible 00:52:17]. An employer is required to look at alternatives. And if the employee says, "I'll go to the Italian office because I speak Italian", you might put in a call to the Italian office. You need to go through and look at alternatives, but not create a job.

Scott: Okay. I'm looking here. Somebody is saying, "That case in August wasn't the Baranya case. You mentioned another case, but I can't remember what it was. It was to do with costs in tribunals". We'll have a wee look at that afterwards, folks, and see if we can find it.

And we've got one last question. "We did offer to revert back to an old role as the role went from rep to area manager, and the candidate didn't perform on sales targets. They refused reverting back to the old role and resigned. We contacted them to rethink, but they refused. Throughout the whole process was explained the reason for the three-month probation clause, etc., and reverting back to the old role".

I suppose it's a situation where you promote somebody, you create a vacancy when they move up, and therefore presumably there would be a role to go back to normally if you haven't filled it, and whether that would be deemed to be suitable. But if the person doesn't want to take the role, and they're not good enough for the one that they've been promoted to, then you take them through the process.

Duncan: I think certainly if they were promoted to, say, the area manager, they would have increased their benefits, salary, whatever, conditions. And then if, at the end of that, they're to revert back to their previous job, from a redundancy perspective, that would not be a suitable alternative because it's different terms and conditions.

Scott:  And presumably, it wouldn't be a redundancy at that stage. It would be a capability [inaudible 00:53:57].

Duncan: Yeah. Sorry. You're terminating on the basis that it's a performance issue, and you have to apply the normal rules when you do that in terms of performance plans and so on. But if the person was given the right to return, they're given a right to return. But as you say, if the job has been filled, there is no job there anymore.

Scott: Okay. We're going to have to leave it there, folks, I'm afraid. Thank you very much to Duncan Inverarity for taking us through those cases. Hopefully, he'll be back at the Annual Review in November. We're going to be here in the end of November again.

Just a reminder, we've got The HR Toolkit, folks. We'll be sending you on a post-event email and you can take advantage of that and get a free trial on those things.

As well as having the webinar on our website in the Employment Hub, you can listen to these things as podcasts. You can go off to Spotify, Amazon Music, and Apple Podcasts and listen to Duncan wax lyrical in your own time as you're walking round the park.

So thank you very much. Our next webinar coming up is on 1 March and it's with Caroline Reidy. We're going to be looking at menopause in the workplace. So that's brilliant.

Thank you very much, Duncan. Thank you, everybody, for listening and we'll see you next time. You take care now. Bye.

Duncan: Thanks a lot. See you. Bye.