On the 16th of July 2018, the Complainant commenced working as a food and beverage manager in the Respondent’s Davenport Hotel and in the Respondent’s other hotels.  He earned an annual salary of €38,000.  By the end of March 2020, 180 employees had been temporarily laid off and there had been 25 redundancies due to the Covid pandemic.  Of those who remained at work, employees earning salaries over €35,000 were asked to take a 10% pay cut.  

The Complainant was made redundant on the 14th of October 2020.  The Complainant claimed the redundancy of his job was not genuine and his dismissal was unfair, saying the Complainant should have been consulted with about possible alternatives to redundancy, such as reducing his hours further or going on temporary unpaid layoff.

The Respondent denied unfair dismissal, arguing the impact of the Covid-19 pandemic meant there was simply no job for the Complainant. In late July 2020, the government’s decision to replace the Temporary Wages Subsidy Scheme (TWSS) with the Employment Wage Subsidy Scheme (EWSS) had the effect of increasing the cost of payroll for the respondent by approximately €74,000 per month, adding to already significant losses for the Respondent.  This was the context in which further “unpalatable but necessary” decisions were required by the Respondent to protect the business.

The company's Chief Executive, Paul O'Callaghan, argued the group cut its workforce by two thirds when restrictions were imposed on the hospitality sector on public health grounds in March 2020.

Mr O'Callaghan submitted that the Respondent group was spending €350,000 a month - €181,000 of that some on salaries - even though its revenues were down 85-90%. He said the hotel group was "making up work" for those still on the roster. To compensate, managers decided to cut 17 more jobs.

The Adjudication Officer noted that the Respondent had "battened down the hatches" when lockdown came with "no idea" they would be closed for 19 months.  The Adjudication Officer noted further that there was no evidence the managers "contemplated closing down or selling any of their properties or changing their use and that they set their sights on riding out the storm until they could open again”.  In such a scenario, it is obvious that the job of the Complainant, and other jobs that were laid off or made redundant, were going to be needed when the business opened up again."

The Adjudication Officer stressed this simply does not relieve the company of the requirement to act reasonably when it comes to making an employee redundant, to consider all possible alternatives and to involve the employee in the final decision.

The Adjudication Officer ultimately concluded that the Complainant’s dismissal was unfair and ordered the Respondent company to pay him €28,500 in compensation for loss of earnings.

Guidance for Employers

6(4)(c) of the Unfair Dismissals Act recognises the right of an employer to dismiss an employee due to redundancy. This right is predicated on an obligation to select employees for redundancy on the basis of fairness and to adhere to an agreed procedure or a code of practice regarding dismissals.   In the case of this former employee, he was not a member of a trade union and  no evidence was submitted of the existence of a procedure for implementing redundancies.  In the absence of an agreed procedure, the respondent was required to ensure that the fair procedures that apply in the case of any dismissal were afforded to the complainant.  These include the right to notice, the right to be represented at meetings, the right of the employee to respond to the employer’s decision to make his job redundant and the right of appeal.
https://www.workplacerelations.ie/en/cases/2022/july/adj-00030515.html