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Industrial Tribunals Northern Ireland Decisions
You are here: BAILII >> Databases >> Industrial Tribunals Northern Ireland Decisions >> Stanfield v Hills Components Ltd [2012] NIIT 00444_12IT (19 July 2012)
URL: http://www.bailii.org/nie/cases/NIIT/2012/444_12IT.html
Cite as: [2012] NIIT 00444_12IT, [2012] NIIT 444_12IT
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THE INDUSTRIAL TRIBUNALS
CASE REF: 444/12
CLAIMANT: Mark Peter Stanfield
RESPONDENT: Hills Components Ltd
DECISION
The unanimous decision of the tribunal is that the claimant was not unfairly dismissed and his claim to the tribunal is therefore dismissed.
Constitution of Tribunal:
Chairman: Mrs Ó Murray
Members: Mr P Archer
Miss G Ferguson
Appearances:
The claimant appeared in person accompanied by his wife.
The respondent was represented by Mr C Hamill, Barrister-at-Law, instructed by Worthingtons Solicitors.
The Claim
1. The claimant claimed that he was unfairly dismissed. The respondent claimed that the claimant was fairly dismissed for redundancy.
The Issues
2. The issues for the tribunal were therefore as follows:-
(1) Was the claimant’s post redundant due to a downturn in work?
(2) Was redundancy the reason for the claimant’s dismissal.
(3) Was that dismissal fair or unfair in all the circumstances?
(4) Was sufficient consultation carried out and did the respondent consider suitable alternative employment for the claimant?
Sources of Evidence
3. For the respondent, the tribunal heard evidence from Mr Cullum, the Managing Director, and from Mr Thomas, the Operations Director. The claimant gave evidence on his own behalf. The tribunal had regard to the documentation to which it was referred.
The Law
4. The right not to be unfairly dismissed is set out in the Employment Rights (Northern Ireland) Order 1996 as amended (referred to below as ERO). One of the potentially fair reasons for dismissal listed in ERO is redundancy. It is for the employer to show the reason for dismissal and it is for the tribunal to determine whether the dismissal was fair in all the circumstances.
5. The two key elements in a redundancy process relevant to this case are, firstly, that there should be fair warning and consultation to enable the employee to respond to the proposed redundancy so that the employee is in a position to suggest alternatives and, secondly, that suitable alternative employment is actively considered and offered by the employer, if available.
6. The employer must follow the basic minimum procedures stipulated under the statutory dismissal procedure legislation (the SDP) as otherwise the dismissal will be automatically unfair.
7. If the employer fails to follow proper procedures other than the SDP, it is open to the tribunal to find that the dismissal was nevertheless fair, as dismissal would have ensued even if there had been no flaws in the procedure. This is stipulated in Article 130A of ERO.
Findings of Fact and Conclusions
8. The tribunal found the following relevant facts on a balance of probabilities and reached the following conclusions having applied the legal principles to the facts found.
9. The claimant was employed as a sales manager with sole responsibility for the island of Ireland. His employment began on 12 August 2002 and ended on 1 February 2012 when he was dismissed.
10. The respondent’s business involved selling components to trade customers throughout the British Isles. The respondent was based in England and at the height of their business, approximately 14 years ago, they employed approximately 50 people including approximately five employed sales representatives.
11. We accept that a redundancy situation pertained at the relevant time due to a downturn in business throughout the British Isles, but particularly in Ireland. Our primary reasons for so finding are as follows:-
(1) The turnover figures supplied show a steady decline in business between 2002 and 2012.
(2) We accept the respondent’s case that the decline was more marked in Ireland as the figures bear that out and the claimant actually agreed that things were worse in Ireland at one of the key meetings in January 2012.
(3) At the time relevant for these proceedings, the claimant was the last employed representative in the whole of the British Isles and, as business in his region had declined more markedly than the rest of the British Isles, his post was clearly liable to be made redundant.
(4) The respondent company had taken various measures, including reducing working hours for staff at headquarters and reducing the pay of employed staff, for a substantial period prior to taking the decision that the claimant’s post was at risk of redundancy.
12. At the outset of the hearing the claimant alleged that his post was not redundant as the figures did not present an accurate picture of his turnover for Ireland. He alleged that the company actively took customers away from his account from 2010 as a result of his having raised a grievance against his line manager. The claimant’s allegation was that this was the beginning of a campaign to get rid of him and that this was the real reason for him being dismissed in 2012. We do not accept the claimant’s case on this point for the following principal reasons:-
(1) The claimant changed his case on this during the hearing when it became apparent that the figures presented showed a decline in business from 2006 onwards, that is four years before the alleged campaign to take clients away from him.
(2) We have looked carefully at the notes of meetings and correspondence between the respondent’s managers and the claimant in relation to the performance of his region for the years prior to his dismissal in 2012, and our assessment is that the company took great pains to work with the claimant to find ways of improving business in his area. Detailed suggestions were made to the claimant for ways to improve efficiency and to generate business and, despite this, the claimant accepted that he decided himself not to implement some of the suggestions as he did not agree with them.
13. The claimant suggested that, if his performance had been bad, he should have been placed on a disciplinary footing and his performance managed in that way. We do not accept that a failure to discipline the claimant meant that the respondent was acting unreasonably. For a very lengthy period the respondent took active steps to try to work with the claimant to promote and increase business in his region.
14. We regard it as reasonable of the employer to decide that the claimant’s post was at risk due to the particular downturn in work in Ireland and due to the fact that he was the last remaining employed sales representative. We accept the respondent’s evidence that the figures were such, that the turnover in Ireland did not justify the salary and associated costs of employing the claimant.
15. By letter of 4 January 2012, the claimant was warned that his post was at risk of redundancy and he was notified that a consultation meeting would take place. By agreement, the consultation meeting took place on the telephone and comprised two meetings on 24 January 2012 and 27 January 2012.
16. The claimant’s criticism of the consultation process was as follows:-
(1) that 20 days was too long a period to elapse between the warning letter and the first meeting as this caused stress to the claimant;
(2) that the respondent did not put forward any alternatives to redundancy but waited for the claimant to put forward options;
(3) that the claimant’s questions about the options available were not answered and that the consultation was abruptly ended without further exploration;
(4) that the respondent did not explore the formulation of contractual terms which could have restricted the claimant’s activities so that there would be no conflict of interest.
17. We do not accept that there was undue delay between the warning letter and the meeting. Indeed, we regard it as reasonable for the claimant to have been given time to think about his reaction to the proposed redundancy and for him to think of any proposed alternatives to redundancy: that is the primary purpose of the consultation process.
18. We do not regard it as a flaw in the procedures that the respondent did not volunteer suggestions. It is clear that the respondent considered the options put forward by the claimant.
19. In effect, there was only one option potentially amounting to alternative employment, namely, a reduction of the claimant’s working week to three days. The claimant made it clear to his employer and to the tribunal that he could not have survived on part-time earnings but would have had to seek other employment during the days he was not working for the respondent. The claimant, very sensibly, raised issues about potential conflicts of interest with the respondent to ensure that, if he agreed to that option, he would not expose himself to the risk of being accused of working against the respondent’s interests by working for one of its competitors.
20. We accept Mr Cullum’s evidence that, when the conflict issues were raised with him, it dawned on him that the three-day option was not workable in practice. The reason he had initially considered the three-day option was because he previously had accepted it with a sales representative who retired and returned on a three-day week. The difference with that individual was that there was no question of him seeking to work for anyone else in the days he was not working for the respondent so no conflict of interest arose.
21. In these circumstances, we do not regard the ending of the consultation as abrupt. It was clear that there was no alternative to redundancy and it was reasonable for the employer to move to make the claimant redundant at that point.
22. The claimant was dismissed for redundancy by letter of 31 January 2012. The claimant was advised of his right to appeal in that letter.
23. The claimant exercised his right to appeal and an appeal hearing took place on the telephone on 16 February 2012. This appeal was conducted by Mr Cullum. Mr Cullum was the person who had taken the decision to dismiss. As no new material was put forward at appeal, the decision to dismiss was upheld by Mr Cullum.
24. In this case, it was a flaw in procedure that Mr Cullum took the decision to dismiss and he also conducted the appeal. This was not a small organisation where there was no one else available to take the decision to dismiss. There were several people at director level who could have taken that decision leaving Mr Cullum available to conduct the appeal. However, in this case, we do not find that the flaw made the dismissal unfair. In the circumstances of this case, we find that dismissal would have occurred anyway even if the flaw had not been present and we therefore find that Article 130A of ERO comes into play and the dismissal was fair. Our reason for so finding is that the claimant, as the last remaining sales representative, was clearly liable to be made redundant given the downturn in sales and the lack of suitable alternative employment.
25. There was some discussion in the hearing in relation to gardening leave and a non-solicitation clause in the claimant’s contract. Our conclusions on the meaning and effect of those clauses would have been relevant to any compensation payable if we had found the claimant to have been unfairly dismissed. As we have found that the claimant was not unfairly dismissed, we do not need to reach a conclusion on the meaning and effect of those clauses.
26. The evidence given in relation to the clauses however is relevant to the credibility of the claimant. We found the claimant’s evidence in relation to his understanding and his actions relating to the clauses, at best, unreliable and at worst, evasive. Specifically we do not accept the claimant’s case that Mr Thomas told him that he had to adhere to a period of gardening leave. Our primary reasons for so finding are firstly, that the claimant’s evidence was contradictory and implausible in several respects and, secondly, the letter of dismissal made explicit reference to pay in lieu of notice which was one of the alternative options to the gardening leave option in the contract. Our findings on this point meant that the reliability and credibility of the claimant’s evidence was tainted and, for this reason, we accepted the evidence of Mr Cullum and Mr Thomas where it conflicted with the evidence given by the claimant on other matters.
Summary
27. Due to a decline in the respondent’s business there was a redundancy situation at the relevant time and there was therefore a reasonable basis for the respondent to conclude that they might have to make the claimant redundant.
28. The respondent complied with the SDP and complied with a reasonable redundancy procedure except insofar as there was the flaw set out at paragraph 24 above.
29. Specifically the respondent conducted a reasonable consultation process with the claimant and considered whether there was suitable alternative employment as an alternative to redundancy. In this regard, we wish to make clear, as we did in the hearing, that the claimant’s apparent preferred option of being made redundant and obtaining an agency arrangement with the respondent could not constitute suitable alternative employment as it involved the claimant leaving the respondent’s employ and becoming self-employed.
30. It was reasonable for the respondent to dismiss the claimant for redundancy. The flaw in procedure identified at paragraph 24 above did not render that dismissal unfair in the circumstances of this case
31. The claimant’s claims are therefore dismissed in their entirety.
Chairman:
Date and place of hearing: 3 and 4 July 2012, Belfast.
Date decision recorded in register and issued to parties: