McErlain v Paul McAleer t/a Sperrin Engin... [2012] NIIT 00857

THE INDUSTRIAL TRIBUNALS

CASE REF: 857/11

CLAIMANT: Noel McErlain

RESPONDENT: Paul McAleer t/a Sperrin Engineering

DECISION

The unanimous decision of the tribunal is as follows:-

1. that the claimant was unfairly dismissed and the respondent is hereby ordered to pay the claimant compensation in the sum of £5,088.00; and

2. that the claimant is entitled to 1 week’s wages in respect of a “lying week” and the respondent is hereby ordered to pay to the claimant the sum of £287.00; and

3. that the claimant is entitled to 3 weeks notice pay and the respondent is hereby ordered to pay to the claimant the sum of £861.00.

Constitution of Tribunal:

Chairman: Ms J Turkington

Members: Mr W Irwin

Mrs T Kelly

Appearances:

The claimant appeared and was represented at the hearing by Mr Eamon O’Neill, lay representative.

The respondent did not appear at the hearing.

At the beginning of the hearing, the tribunal sought to clarify the identity of the respondent. The claimant confirmed that his employer was Paul McAleer trading as Sperrin Engineering and the title of the proceedings is hereby amended accordingly.

The Claims

1. The claims before the tribunal were:-

(a) a claim of unfair dismissal;

(b) a claim for a statutory redundancy payment;

(d) a claim in respect of notice pay.

The Issues

2. The issues to be determined by the tribunal in relation to the claim of unfair dismissal were:-

(a) whether the claimant was dismissed by the respondent;

(b) if so, whether the respondent had complied with the statutory dismissal procedure pursuant to The Employment (Northern Ireland) Order 2003 and The Employment (Northern Ireland) Order 2003 (Dispute Resolution) Regulations (Northern Ireland) 2004 and therefore whether the dismissal of the claimant was automatically unfair;

(c) if the claimant was not dismissed by the respondent, did the claimant terminate his employment in circumstances where he was entitled to do so in response to a serious breach of contract by the respondent, that is whether the claimant was constructively dismissed by the respondent; and, if appropriate;

(d) the compensation to be awarded to the claimant.

3. The claimant also brought a claim in respect of a statutory redundancy payment. The claimant’s representative accepted at the outset of the hearing that this claim may be effectively subsumed by the basic award for unfair dismissal if the tribunal found that the claimant had been unfairly dismissed.

4. The issue to be determined by the tribunal in relation to the claim in respect of unpaid wages was whether the claimant had worked a “lying week” without pay at the beginning of his employment and whether pay in respect of that week was still outstanding at the termination of his employment.

5. In respect of the claim for notice monies, the issue to be determined by the tribunal was whether the claimant had received the required period of notice of termination of his employment. If not, had he received pay in lieu of notice and, if not, the sum to which the claimant was entitled.

Disposal of the claim in the absence of the respondent

6. The respondent did not appear at the hearing. The tribunal was satisfied that the Notice of Hearing had been sent to the respondent at his last known address in good time before the hearing. The respondent contacted the Office by e-mail very late in the evening before the hearing indicating that he would not be able to attend the hearing and inviting the tribunal to proceed to hear the case in his absence. The respondent’s message did not contain any request for a postponement of the hearing nor was there any indication that the respondent would attend any postponed hearing. In the circumstances, the tribunal decided that it was appropriate to proceed to hear the claim in the absence of the respondent.

Contentions of the parties

7. The claimant’s representative contended that the claimant had been dismissed in early January 2012 without the respondent following any dismissal procedure. In the alternative, the claimant’s representative contended that the claimant had been constructively dismissed since he was entitled to terminate his employment in view of the respondent’s continual delays in paying the claimant’s wages. On behalf of the claimant, it was also contended that he was owed a week’s pay in respect of a “lying week” and that he had been dismissed without notice.

8. The respondent contended in his response form that the claimant had not been dismissed, but rather that he had resigned and had asked for his P45.

Sources of Evidence

9. The tribunal heard oral evidence from the claimant and considered a number of documents submitted on behalf of the claimant. The tribunal also considered and took account of the content of the response form submitted by the respondent.

Facts of the Case

10. Having considered the claim form submitted by the claimant and the response form submitted by the respondent, and having heard the claimant’s evidence and considered the documents submitted by the claimant, the tribunal found the following relevant facts:-

11. The claimant who was born on 24 December 1976 was employed by the respondent as a fitter/welder from August 2007. During the course of his employment, the claimant’s rate of pay was reduced by the respondent. At the end of his employment, the claimant’s wages were £357.00 per week gross, £287.00 per week net. The claimant never received pay slips, although he had requested pay slips from the respondent.

12. At the beginning of his employment, the claimant worked a “lying week”. He did not receive any pay until the end of his second week of employment. This was customary in the industry and the claimant understood that he would receive payment for this lying week upon the termination of his employment.

13. The claimant started his Christmas holidays on 21 December 2010. At that time, he was owed 5 weeks wages by the respondent. The claimant asked the respondent about his wages. The respondent replied that all his monies would be in the bank.

14. The claimant phoned the respondent on 23 December 2010. The respondent told him that all the monies owed should have been in the bank.

15. After Christmas 2010, when the bank had re-opened, the claimant checked and his wages were still not in his bank account. He phoned the respondent again on
31 December 2010.

16. On 2 January 2011, the claimant received a text message from the respondent telling him not to come back to work as he had expected on 3 January, but rather to wait until 10 January. The claimant phoned the respondent that evening and was told by the respondent that it could be a number of weeks before he could be back to work.

17. The claimant checked at the bank again and knowing that his pay still had not been paid in to his bank account, the claimant phoned the respondent again on 6 January about the money he was owed. The respondent became angry and told the claimant that he was “letting us go. P45s would be out within the week”.

18. In his evidence, the claimant emphatically denied that he had asked for his P45 or that he had resigned as contended by the respondent. The tribunal found the claimant to be an entirely straightforward and honest witness and the tribunal had no hesitation in accepting the claimant’s version of events as given in his sworn evidence.

19. The claimant was in no doubt that he had been dismissed by the respondent. The claimant received a text message from the respondent the next day, 7 January, which said “as previously discussed, all P45s in post”. The claimant then began to look for alternative employment.

20. The claimant eventually received payment in respect of all the wages owing to him, save for the lying week at the beginning of his employment.

21. The claimant wrote to the respondent on 31January 2011. In this letter, the claimant outlined his version of events and sought his entitlements in respect of a redundancy payment, notice, holiday pay and other monies owed.

22. The respondent replied by letter dated 13 February 2011. In this letter, the respondent alleged that the claimant had asked for his P45 and that employees had been asked to take unpaid leave whilst the respondent sought to resolve cash flow difficulties.

23. The claimant responded to this correspondence by letter dated 20 February 2011 in which he disputed the respondent’s version of events. In this letter, the claimant pointed out that he was owed a lying week’s wages. This letter was sent by recorded delivery to both the respondent’s home and business addresses, but was returned undelivered.

24. Shortly, after the termination of his employment, the claimant did 3 days work and was paid £55.00 per day net. He did not sign on for unemployment benefits. The claimant was able to secure alternative employment in a permanent post commencing on 2 February 2011. Initially, the claimant earned £285.58 gross, £240.00 net, but this increased from 6 June 2011 to £344.66 gross, £280.00 net. The claimant eventually received his P45 from the respondent and this was passed to his new employer. On the P45, the respondent had noted the date of termination of his employment as 31 December 2010.

25. As far as the claimant is aware, the respondent is continuing in business and continuing to employ staff.

Statement of Law

26. The statutory dismissal procedure introduced by the Employment Rights (Northern Ireland) Order (“the 2003 Order”) applies in this case. In basic terms, the statutory procedure set out in Schedule 1 of the 2003 Order requires the following steps:-

Step 1

Written statement of grounds for action and invitation to meeting – the employer must set out in writing the grounds which lead the employer to contemplate dismissing the employee.

Step 2 - Meeting

The meeting must take place before action is taken. The meeting must not take place unless –

(a) the employer has informed the employee what the basis was for including in the statement the grounds given in it, and

(b) the employee has had a reasonable opportunity to consider his response to that information.

After the meeting, the employer must inform the employee of his decision and notify him/her of the right to appeal against the decision.

Step 3 - Appeal

If the employee informs the employer of his/her wish to appeal, the employer must invite him/her to attend a further meeting. After the appeal meeting, the employer must inform the employee of his final decision. The employee must be afforded the right to be accompanied at any meetings under the statutory dismissal procedure.

27. By Article 130A (1) of the Employment Rights (Northern Ireland) Order 1996 (“the Order”), where the statutory dismissal procedure is applicable in any case and the employer is responsible for non-completion of that procedure, the dismissal is automatically unfair. A tribunal is required to consider whether the dismissal is automatically unfair under Article 130A even where this issue has not been specifically raised by the claimant – see Venniri v Autodex Ltd (EAT 0436/07).

28. Pursuant to Article 17 of The Employment (Northern Ireland) Order 2003, where it appears to the tribunal that the non-completion of the statutory dismissal procedure was wholly or mainly attributable to the employer, it shall increase any award made to the employee by 10% and it may, if it considers it just and equitable in all the circumstances to do so, increase the award by a further amount up to 50%.

29. By Article 118 of the 1996 Order, the notice required to be given by an employer to terminate the contract of employment of an employee is one week where the claimant was employed for a period between one month and two years and an additional week for each completed year of continuous employment thereafter.

30. By Article 45 of the Employment (Northern Ireland) Order 1996, an employer shall not make a deduction from wages of a worker employed by him unless the deduction is authorised by statute or a relevant provision of the worker’s contract or the worker has previously signified in writing his consent to the making of the deduction. A complete failure to pay wages on any occasion constitutes a deduction from wages.

Conclusions

Unfair dismissal

31. In light of the facts found, the tribunal was satisfied that the words used by the respondent, that is that he was “letting us go. P45s would be out within the week” amounted to clear words of dismissal. The claimant also understood these to be words of dismissal and acted immediately on this understanding by seeking alternative employment. The tribunal therefore had no doubt that the claimant was dismissed by the respondent on 6 January 2011.

32. The claimant was dismissed in the course of a telephone call. The respondent did not meet with the claimant nor was he offered the right to be accompanied or any right of appeal. The tribunal had no hesitation in concluding that none of the requirements of the statutory dismissal procedure were complied with in this case. The tribunal was satisfied on the basis of the facts found that the non-completion of the statutory dismissal procedure was wholly attributable to the respondent. The tribunal therefore concluded that the dismissal of the claimant was automatically unfair. Furthermore, the respondent failed to show the reason for the dismissal of the claimant and that the reason was one of the statutory potentially fair reasons for dismissal. In the circumstances, it was not therefore necessary for the tribunal to consider whether the dismissal was fair in all the circumstances.

33. Accordingly, the unanimous decision of the tribunal is that the claimant was unfairly dismissed and that the claimant is entitled to compensation for such unfair dismissal. The tribunal concluded that there was no contributory fault on the part of the claimant.

34. In the alternative, had the tribunal accepted the respondent’s contention that the claimant asked for his P45 and therefore resigned, the tribunal would have concluded that he was entitled to resign in response to the respondent’s continual and serious breaches of the claimant’s contract in failing to pay wages on time. In other words, had it been necessary for the tribunal to determine this point, the tribunal would have concluded that the claimant was constructively unfairly dismissed by the respondent.

Statutory redundancy payment

35. Since the tribunal has concluded that the claimant was unfairly dismissed, as conceded by the claimant’s representative, any entitlement of the claimant to a statutory redundancy payment is effectively subsumed by the basic award for unfair dismissal.

Lying week’s pay

36. The tribunal found as a fact that the claimant worked 2 weeks at the beginning of his employment before he received any pay. It was understood by the parties and customary in the industry that pay in respect of such a lying week would be paid on termination of the employment. The claimant did not receive such pay on termination or thereafter. Accordingly, the claimant is still owed a week’s pay in respect of this lying week.

Notice pay

37. In light of the facts set out above, the tribunal determined that the effective date of dismissal in this case was 6 January 2011. The dismissal of the claimant took effect immediately so that the claimant received no notice of termination. The claimant is entitled to 3 weeks pay in lieu of notice.

Compensation

38. Having determined that the claimant was unfairly dismissed, the tribunal went on to consider the appropriate remedy. The claimant did not seek reinstatement or re-engagement. The tribunal therefore considered that the appropriate remedy was compensation.

39. The claimant had begun to look for alternative employment immediately after he was dismissed. The claimant had found another job within a few weeks and the tribunal was therefore completely satisfied that the claimant had made reasonable efforts to mitigate his loss. However, that alternative employment continues to be at a (slightly) lower rate of pay than the claimant’s wages with the respondent. Given the difficult economic climate in Northern Ireland generally at the present time and using its best judgment, the tribunal has concluded that it is likely to take until 6 June 2012, that is 12 months from his last pay rise, for the claimant to achieve earnings equal to or greater than his earnings with the respondent.

40. Accordingly, the tribunal determined that it would be just and equitable in all the circumstances for the claimant to be awarded ongoing loss of earnings for a period up to June 2012.

41. The tribunal considered the appropriate uplift to the award for unfair dismissal pursuant to Article 17 of the 2003 Order as described at para 28 above. In view of the facts found, the tribunal considered that the respondent’s non-compliance with the statutory dismissal procedure was extremely serious. None of the steps of the statutory dismissal procedure were complied with in this case. The tribunal concluded that the uplift should be at end of the scale between 10 and 50 %. Therefore, the tribunal determined that it was just and equitable in all the circumstances for the award to the claimant in respect of unfair dismissal to be increased by 50%. Further, where the dismissal is automatically unfair as it is in this case, the basic award must be a minimum of 4 weeks gross pay.

42. The tribunal considers that the appropriate compensation in this case in accordance with Article 152 to 158 of the Employment Rights (Northern Ireland) Order and Article 17 of the Employment (Northern Ireland) Order is as follows:-

(A) Basic award

£357.00 (gross weekly wage) X 4 (minimum basic award) = £1,428.00

(B) Compensatory award

Immediate loss to date of hearing:-

1. 6 January 2011 to 2 February 2011 = 4 weeks @ £287.00 per week

= £1,148.00

Less 3 days wages @ £55.00 per day - £165.00

= £983.00

2. 2 February 2011 to 6 June 2011 = 19 weeks @ £47.00 per week

(£287.00 - £240.00) = £893.00

3. 6 June 2011 to 6 June 2012 = 52 weeks @ £7.00 per week

(£287.00 - £280.00) = £364.00

(C) Loss of statutory rights £300.00

Total compensatory award for unfair dismissal (B) = £2,240.00

Increase in monetary award of 50% ADD £1,120.00

TOTAL monetary award after increase = £3,360.00

The tribunal considers that a reduction for contributory fault is not appropriate in this case.

Accordingly, the tribunal hereby orders the respondent to pay to the claimant compensation for unfair dismissal as follows:-

Basic award (A) £1,428.00 + increased compensatory award £3,360.00 + loss of statutory rights (C) £300.00

TOTAL award for unfair dismissal = £5,088.00

Prescribed element = NIL

43. The claimant is entitled to 1 weeks pay in respect of his lying week as follows:-

Award in respect of unpaid wages - 1 week’s net pay = £287.00

44. The claimant is also entitled to 3 weeks pay in respect of notice pay for the weeks calculated as follows:-

Award in respect of notice monies 3 x £287.00 = £861.00 (net)

45. This is a relevant decision for the purposes of the Industrial Tribunals (Interest) Order (Northern Ireland) 1990.

Chairman:

Date and place of hearing: 18 April 2012, Belfast.

Date decision recorded in register and issued to parties:

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	Industrial Tribunals Northern Ireland Decisions
You are here: BAILII >> Databases >> Industrial Tribunals Northern Ireland Decisions >> McErlain v Paul McAleer t/a Sperrin Engin... [2012] NIIT 00857_11IT (19 June 2012) URL: http://www.bailii.org/nie/cases/NIIT/2012/857_11IT.html Cite as: [2012] NIIT 00857_11IT, [2012] NIIT 857_11IT

Industrial Tribunals Northern Ireland Decisions

Disposal of the claim in the absence of the respondent