Scott v David Gillespie & Company [2010] NIIT 07449

THE INDUSTRIAL TRIBUNALS

CASE REF: 07449/09

CLAIMANT: Ian Scott

RESPONDENT: David Gillespie & Company

DECISION

The unanimous decision of the tribunal is that the claimant’s claims in respect of a redundancy payment and unlawful deduction of wages are dismissed.

Constitution of Tribunal:

Chairman: Mr. I Wimpress

Panel Members: Mr. P McKenna

Ms. E Kennedy

Appearances:

The claimant was unrepresented and appeared on his own behalf.

The respondent was represented by Ms Rachel Best, Barrister-at-Law, instructed by Carson McDowell, Solicitors.

The Claim and the Response

1. In his claim form, the claimant contended that he was entitled to a redundancy payment and £612.00 in respect of an unlawful deduction of wages for a period when he worked a three day week as opposed to five day week. According to the claimant this figure represented 10 days loss of wages.

2. As indicated in the response the correct name of the respondent is David Gillespie & Company and the tribunal orders that the title to the proceedings be amended accordingly. In its response the respondent denied that the claimant was entitled to a redundancy payment as he had at no time been advised that his position was redundant. According to the respondent the claimant was advised that he was being placed on a three day week and that there was a risk of redundancy in the company. The respondent also denied that the claimant was entitled to receive any repayment of wages in respect of the period when he was required to work a three day week as opposed to a five day week.

Sources of Evidence

3. The tribunal received a small bundle of relevant documents and heard oral evidence from the claimant and Mr David Gillespie.

The Facts

4. The claimant’s date of birth is 13 March 1963. The claimant was employed as a painter and decorator in the respondent business. The claimant had worked for the respondent since 1986 and he worked a basic 39 hour week. The claimant’s gross pay was £390.00 per week and his take home pay was £305.00 per week.

5. On Wednesday 2 September 2009, the proprietor, Mr Gillespie, called a meeting of staff and informed them that due to a lack of work they were being put on a three day week with immediate effect. Mr Gillespie gave the claimant a letter in the following terms:

"Due to a reduction in our contracts, it is with regret that you now have to be placed on a 3 day working week, with the minimum week being 2 days.

You will also be placed on notice of potential redundancy.

YOUR NOTICE ENTITLEMENT IS: 12 WEEKS"

The letter was signed by Mr Gillespie. The claimant was also required to sign it with the claimant and Mr Gillespie each retaining a copy signed by both.

6. At this time, the claimant was working on a contract with Kyle Norton Developments and he made enquiries with the foreman as to whether there were any jobs

available. The foreman said that he would check and he subsequently advised the claimant that there was a full-time post if he was interested.

7. The claimant took up this job offer and on Monday 26 October 2009, he informed Mr Gillespie that he had accepted an offer of work elsewhere and that he was willing to work the remainder of his notice. He also stated that he would finish any existing contract of work or work one or two week’s notice. It was agreed that he would work out two week’s notice. On 3 November 2009 Mr Gillespie gave the claimant a letter which read as follows:

"We confirm that we accept your resignation given to us on Monday 26 October 2009 and you will be leaving our employment on Friday 6 November 2009."

8. On 5 November 2009 the claimant wrote to the respondent and claimed that he was entitled to statutory redundancy pay based on 12 year’s service and to have his pay made up to his full contracted pay from 2 September 2009. The claimant claimed to be entitled to £612.00 in respect of the latter.

9. In his evidence to the tribunal Mr Gillespie maintained that he called the meeting on 2 September 2009 because of a downturn in the business and that it was his aim to avoid redundancies. There was some dispute as to whether all staff attended the meeting. The claimant alleged that one member of staff who was the subject of disciplinary action was missing. Mr Gillespie maintained that all were present. It is common case however that all those who attended were in full agreement with Mr Gillespie's plan of action which was to temporarily reduce the working week until business conditions improved. Mr Gillespie’s evidence to the tribunal was that the only reason for referring to the notice period was to provide this information to his employees most of whom had worked for the respondent for many years and who would not be aware of their exact length of service. It was common case that Mr Gillespie also said that if there were to be redundancies there would be a further meeting about redundancy selection criteria.

10. In the event, it was not long before Mr Gillespie was able to restore a five day working week for his employees. This occurred around the start of November 2009 and there were no redundancies. By this time however two employees, the claimant and one other had left and taken up employment with Kyle Norton Developments. They were not replaced but this was not due to any shortage of work but rather due to Mr Gillespie's decision to have this work undertaken by self-employed sub-contractors instead. Mr Gillespie regarded the claimant as a good worker and was sorry to lose him particularly in circumstances where two employees moved to a company that the respondent had been working for on a contract. The claimant's pay for his new job which was full-time and was on a par with what he had been paid by the respondent.

The Law

11. The main statutory provisions in relation to redundancy are contained in Articles 170, 174 and 182 of the Employment Rights (Northern Ireland) Order 1996 (“the 1996 Order”) the relevant portions of which provide as follows:

170.—(1) An employer shall pay a redundancy payment to any employee of his if the employee—

(a) is dismissed by the employer by reason of redundancy, or

(b) is eligible for a redundancy payment by reason of being laid off or kept on short-time.

174.—(1) For the purposes of this Order an employee who is dismissed shall be taken to be dismissed by reason of redundancy if the dismissal is wholly or mainly attributable to—

(a) the fact that his employer has ceased or intends to cease—

(i) to carry on the business for the purposes of which the employee was employed by him, or

(ii) to carry on that business in the place where the employee was so employed, or

(b) the fact that the requirements of that business—

(i) for employees to carry out work of a particular kind, or

(ii) for employees to carry out work of a particular kind in the place where the employee was employed by the employer, have ceased or diminished or are expected to cease or diminish.

(5) In paragraph (1) "cease" and "diminish" mean cease and diminish either permanently or temporarily and for whatever reason.

182. — (1) For the purposes of this Part an employee shall be taken to be laid off for a week if—

(a) he is employed under a contract on terms and conditions such that his remuneration under the contract depends on his being provided by the employer with work of the kind which he is employed to do, but

(b) he is not entitled to any remuneration under the contract in respect of the week because the employer does not provide such work for him.

(2) For the purposes of this Part an employee shall be taken to be kept on short-time for a week if by reason of a diminution in the work provided for the employee by his employer (being work of a kind which under his contract the employee is employed to do) the employee's remuneration for the week is less than half a week's pay.

Submissions

12. The main dispute between the parties was the status and interpretation of the letter of 2 September 2009. The claimant contended that it amounted to a redundancy notice which had the effect of entitling him to a redundancy payment on leaving the respondent's employment. Ms Best submitted that in order to qualify for a redundancy payment there must be a dismissal and that it was not a redundancy situation. Nor did the claimant qualify for a redundancy payment by dint of being put on short time work because the reduction in the working week was not great enough to count under article 182 of the 1996 Order. Ms Best submitted that the claimant was not dismissed but resigned of his own volition to take up full-time employment elsewhere for better pay. The letter of 2 September 2009 was merely advising of potential redundancies and that the reference to a notice period would only become relevant if a redundancy situation occurred and it was necessary to have a selection process. Ms Best further submitted that there was nothing untoward in Mr Gillespie setting out details of his employees' notice entitlement for clarification purposes. In support of her contentions Ms Best relied on two cases both of which are cited by the authors of Harvey, Division E Redundancy Section C 825. The first of these cases J & J Stern v Simpson [1983] IRLR 52 EAT held that where there is ambiguity the tribunal must construe the notice in the context of the facts of the case. The second case Morton Sundour Fabrics Ltd v Shaw [1984] ITR 84 held that a warning of future redundancies is not a dismissal with notice (or at all) and that if an employee leaves after such a warning he will be treated as having resigned and will not be entitled to a redundancy payment. A true notice of dismissal will not only inform the employee that his employment will end but will also inform him either directly or indirectly of the date upon which the employment will end. In relation to the alleged unlawful deduction of wages Ms Best submitted that as the working week was reduced by the parties by consent, the claimant was not entitled to recover any lost wages.

Conclusion

13. The evidence clearly establishes that this was not a redundancy situation. Rather the true position was that Mr Gillespie took the responsible step of warning his employees about the possibility of future redundancies. In the event there were no redundancies but the warning given by Mr Gillespie enabled the claimant to take stock of the situation and acquire a more secure job elsewhere. This case is similar in many ways to Morton Sundour Fabrics Ltd v Shaw and as in that case the claimant resigned and is not entitled to a redundancy payment. Nor is the claimant entitled to recover the wages that he lost during the period when he was on short time for the straightforward reason that he agreed to a reduction in his working days. This does not therefore constitute an unlawful deduction of wages. The claimant’s claim must therefore be dismissed.

Chairman:

Date and place of hearing: 14 January 2010, 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 >> Scott v David Gillespie & Company [2010] NIIT 07449_09IT (01 March 2010) URL: http://www.bailii.org/nie/cases/NIIT/2010/07449_09IT.html Cite as: [2010] NIIT 7449_9IT, [2010] NIIT 07449_09IT

Industrial Tribunals Northern Ireland Decisions