Case Name: Padraic Callinan v Roadstone Wood Limited (UD2170/2010).

Legislation: Unfair Dismissals Acts, 1977 to 2007

Jurisdiction/Subject Matter: Unfair Dismissal, Redundancy


Facts:

The respondent company supplies ready-mix concrete products and other architectural products to the building industry. The company is unionised and deals with a number of Trade Unions, primarily SIPTU. An agreement has been in place between the company and trade unions since January 1985 (the “Agreement”). The purpose of the Agreement is to set out the terms and conditions of employment and to promote peaceful labour relations in the interest of the company, its employees and the trade unions.

The claimant began work with the respondent on 23 February 2004. He was employed as a truck driver in Athlone. The respondent also engaged the services of hired haulage drivers to carry out its work.

Following the collapse of the construction industry and due to market decline across the product group, the respondent introduced a rationalisation plan. There was a 75% decline in business and over 50 locations were closed as a result. The total workforce reduced from 1900 in 2007 to 500 at the time of the hearing before the EAT. The Athlone plant was closed with the loss of 7 jobs in March 2010. The claimant was made redundant on 30 April 2010.

As part of the redundancy process, the respondent met with the claimant and his union representative on 10 March 2010 and outlined the company’s position. The redundancy process was carried out in accordance with the procedures laid down in the Agreement.

The respondent originally sought voluntary redundancies but, as there were no volunteers, it proceeded to implement compulsory redundancies. The respondent offered the claimant the redundancy package as well as an ex-gratia payment. The total amount offered was €32,000. The claimant declined this offer.

The regional operations manager of the respondent company gave evidence that at the time of the claimant’s redundancy, the claimant was offered an alternative position as a dump driver with the respondent. This position would be 25 miles from Athlone. It was submitted that the claimant declined this offer.

The position was also advertised internally in the respondent company but there were no applications for the job. The position was eventually filled by a contract worker already engaged on the site.

The claimant denied he was ever offered this position. He said he refused the redundancy package as he wished to retain his job and he believed there was scope within the company to facilitate him on other sites within reasonable distance of his home. He claimed no alternative to redundancy was put to him. The claimant stated that had he been offered this alternative position, he would have taken the job as he did not wish to be unemployed. The Union official who had negotiated with the respondent in respect of the redundancy package also gave evidence that the claimant was not offered alternative employment.

The respondent denied that it breached the Agreement during the redundancy process and that the hired haulage drivers were treated more favourably than its own truck driver employers. The respondent operated a rota system in its Athlone plant as part of the Agreement. The claimant was third or fourth on this system, behind the hired haulage drivers. The hired drivers had been engaged by the respondent before the claimant began his employment with the respondent. There was evidence before the Tribunal that the number of hired haulage drivers had also declined since 2008.


Determination and Legal Review

The Tribunal referred to the “heavy onus on an employer to prove that it acted reasonably and fairly towards an employee selected for redundancy and a consequential duty to use fair procedures in making a redundancy” (Fennell –v- Resource Facilities Support Limited (UD57/2009)).

The Tribunal acknowledged the conflict of evidence regarding the availability of suitable alternative positions and the advertising of the job vacancy. The Tribunal accepted the evidence of the claimant and found that he was not offered alternative positions.
The Tribunal found that the conduct of the respondent failed the test of reasonableness and that the claimant was unfairly selected for redundancy.

The claimant therefore succeeded in his claim and was awarded €30,000.


Conclusion

In a redundancy situation, it is important that an employer acts reasonably and fairly towards an employee in the selection process. Fair procedures should also be used at all times. If an employer does not act fairly and reasonably, it is open to the employee to bring an action for unfair dismissal against the employer if the employee considers that he/she was unfairly selected for redundancy.

It is worth noting that the award was €2,000 less than what was offered by the employer during the redundancy process, and that the matter ran for two days in the EAT, incurring expense and time cost for both parties.