Killen v Bladon Enterprises t/a Soda Jo... [2010] NIIT 01879

THE INDUSTRIAL TRIBUNALS

CASE REF: 1879/10

1884/10

1896/10

1964/10

2032/10

CLAIMANTS: 1. Charlene Killen

2. Thomas Walter Weir

3. William Smallwood

4. Alana Quigley

5. Nicole Kelly

RESPONDENTS: 1. Bladon Enterprises t/a Soda Joe’s

2. Bladon Developments Ltd

3. Odyssey Pavilion Limited Liability Partnership (in administration)

4. Sheridan Entertainments Limited

5. Soda Joe’s Limited

DECISION

The Decision of the Industrial Tribunal is:

(i) that the claimants were unfairly dismissed by the fourth named respondent who accordingly is liable to pay the first named claimant compensation totalling £1,690.21, the second named claimant compensation totalling £2,157.96, the third named claimant compensation totalling £2,683,50, the fourth named claimant compensation totalling £1,526.75 and the fifth named claimant the sum of £2,045.25. The first, second, third and fifth named respondents are dismissed from the claim as they were not the claimants’ employer at the relevant time, namely the date of effective termination of employment.

Constitution of the Tribunal

Chairman: Ms Maire Sheehan

Members: Mrs Gail Ferguson

Mr Iain Foster

Appearances:

The claimants all appeared on their own behalf.

Mr A Harkin Barrister at Law, instructed by C & H Jefferson Solicitors appeared on behalf of the third named respondent.

The fifth named respondent appeared at hearing on their own behalf.

None of the other named respondents entered any response and did not appear at hearing.

The Issues

1. The main issues for the tribunal to decide were (a) who was the claimants’ employer at the effective date of termination of employment; (b) were the claimants unfairly dismissed; (c) the reason for their dismissal, and if redundancy the amount of any payment due in respect of same; (d) were the claimants entitled to notice pay and holiday pay and if so the amount of same. Due to the insolvency of the third and fourth named respondent, the tribunal notes that the Official Receiver confirmed there was no objection to these claims proceeding before the tribunal on the day of hearing.

The Facts

2. The tribunal considered the claim forms and the responses filed by the third and fifth named respondents. The other respondents failed to file any response to the claims served upon them and or their representatives. There was oral evidence given by the claimants, Mr Graham Hutton and Mr Gary Boreland on behalf of the third named respondent. A substantial bundle of documents was produced at the hearing by the claimants and the legal representatives of the third named respondent. The documents ranged from statements of main terms and conditions of employment for each of the claimants, employee handbook for Soda Joe’s, memo dated 4 June 2010 from a Stephen Crickard, bank statements from the claimants, P60 and P45 of Thomas W Weir, various correspondence between Sheridan Entertainments and the claimants but also including an undated reference for Mr G Hutton, printouts from Companies Registry regarding the various respondents and a booklet of documents provided by the third named respondent’s court appointed administrator. On the basis of the evidence received we make the findings of fact set out in the following paragraphs.

3. The first, second, third and fourth claimants, when employed initially at Soda Joe’s restaurant, were given by Graham Hutton, statements of main terms and conditions of employment. The documents provided to them named Bladon Developments Limited as their employer. These documents were provided on various dates between February 2002 and February 2007. The fourth named claimant who commenced employment in April 2007, was given by Graham Hutton, a document naming Bladon Enterprises Limited as her employer.

4. Mr Hutton was employed as a manager for the Soda Joe’s restaurant initially under a contract with the Sheridan Group. The tribunal heard from him that the business was taken over by Bladon Enterprises Limited in 2005 or 2006. The main director of that company was an Alastair Cousins, who was also an employee with other companies in the Sheridan Group. All employees in the restaurant continued working without any break in service. Sheridan Entertainments Limited did all the payroll and banking for staff employed in Soda Joe’s restaurant. Sheridan Entertainments Limited dealt with all HR issues that arose. Julie Cassidy, the person named in the reference provided to Mr Hutton, and produced at this hearing, was the appellate body for any disciplinary action taken by him while manager. At the time of his dismissal he understood Sheridan Entertainments Limited to have taken over his employment, once Alistair Cousins was no longer involved with Soda Joe’s Restaurant.

5. The first named respondent, in February 2010, was in financial difficulties. Mr Hutton, prior to the start of 2010 had toyed with the idea of buying over the Soda Joe’s business. To facilitate a purchase of the business he arranged to open a bank account in the name of Soda Joe’s Limited. This was the name of a
non-operational shelf company, incorporated in September 2009, linked to Sheridan Entertainments Limited. Alastair Cousins, operating as Bladon Enterprises, arranged with Mr Hutton to bank into that newly opened account a fixed sum from the takings of Soda Joe’s Restaurant, to cover wages of all staff employed in that business. Between February and April 2010, Alastair Cousins advised Mr Hutton that there would be no sale of the business to the fifth named respondent.

6. Around the Easter period, Alastair Cousins left the business and Mr Hutton then took instruction from Julie Cassidy, Stephen Crickard and Shane King – all persons employed with Sheridan Entertainments Limited. Mr Hutton between April 2010 and end of May 2010 enquired numerous times regarding new contracts for staff. He was advised it was being sorted. At no time was he ever advised during that period that he was not employed by Sheridan Entertainments Limited. Between April 2010 and 29 May 2010 Mr Hutton continued to manage the restaurant. The restaurant operated a clocking on system and the records from that system were given to staff in Sheridan Entertainments, who then organised the calculation of pay due and transfer of monies to employees accounts.

7. On 29 May 2010 Mr Hutton received a text from Shane King advising him to leave the keys of the restaurant down to the restaurant and to leave the premises with immediate effect. On the 29 May 2010 at 8.30 pm Mr Shane King arrived at the restaurant premises to collect the keys from Ms Killen, who was at that time employed as a supervisor. At that same visit all staff present were informed that the restaurant was closed with immediate effect.

8. A number of the claimant’s gave evidence, in particular Ms Kelly and Ms Killen, that wages from 2007 into 2009 were paid in the name of SJ Leisure. While Ms Killen believed she was paid in that name until February 2010, it is clear from the other claimants and all the bank records produced at hearing that by December 2009 onwards payments of wages were being received from an account in the name of Soda Joe’s Limited until end of April 2010.

9. The claimants’ wages were being paid from an account in the name of Sheridan Entertainments Limited from start of May 2010 until their employment was terminated, with the last payments being received in June 2010.

10. Documentation regarding the dismissal of the claimants included a memo dated 4 June 2010. The document dated 4 June 2010, was handed to some of the claimants by Graham Hutton, the general manager of Soda Joe’s at a meeting held shortly after the date of their dismissal. The memo stated it was from a Stephen Crickard and indicated he was providing details of the claimant’s “employer at the cessation of your employment as Odyssey Pavilion Limited Liability Partnership – in administration”. All the claimants received similar documents.

11. Mr Boreland was the relevant member of staff of KPMG who spoke with those claimants who attended the company’s premises in June 2010, on foot of the memo from Stephen Crickard. He told them at that time they were not employed by the third named respondent. Stephen Crickard is a Director of Sheridan Group of companies including the fourth named respondent. Mr Shane King was the person who handed the keys of the restaurant premises to Lisney Estate Agents on 2 June 2010. Bladon Enterprises had had a lease agreement with the third named respondent which lapsed in April 2010. No invoice was issued for May 2010 to any other person or company. Sheridan Entertainments and Sheridan Operations were both companies named to Mr Boreland by personnel from the third named respondent, when he queried the memo from Stephen Crickard, as bodies seeking to negotiate over the restaurant premises and operating the restaurant at that time.

12. Inland Revenue documentation produced by the claimants at hearing named Bladon Enterprises t/a Soda Joe’s with an Employer PAYE reference 925/TZ18549 for the tax year ending 5 April 2010. The P45 document issued to Mr Weir dated 2 June 2010 named Bladon Enterprises t/a Soda Joe’s as his employer. However the bank statements provided by the claimants for the last months of their employment identified payment of wages electronically from an account named Soda Joe’s Limited throughout the early months of 2010 until the start of May 2010. Payments were then made from “Sheridan Ent Limited” – which was Sheridan Entertainments Limited. Mr Boreland produced to the hearing copies of Northern Bank statements for an account in the name of Sheridan Entertainments Limited for the period 4 May 2010 to 20 May 2010. It shows five separate payments on 12 May 2010 all entitled Sheridan Payroll. There are similar five payments at weekly intervals. Another document entitled ‘Bladon Enterprises BACS Pay Transfer Report (weekly)’ with totals, correlates with one of the payments made on 12 May 2010. All the claimants’ names appear on that document.

13. Disciplinary proceedings had been taken against Mr Smallwood in 2008 and 2009 and documents arising from those proceedings identified the disciplining organisation as Sheridan Entertainments Limited. The signatory on all the letters was Julie Cassidy, identified as Human Resources Administrator. Further, the staff handbook produced to the tribunal – dated September 2002 – referred to “The Sheridan Group Belfast”. The handbook referred to a Sheridan Group pension being available for these claimants to make pension contributions. At page 19 of that booklet it reads “The Managing Director of the Sheridan Group has ultimate responsibility for the implementation of the Company’s health and safety policy”. At page 1 of the booklet under Sheridan Group Belfast – the following names and positions are detailed;- Chairman - Peter Curistan, Director - Peter Holmes, Financial Controller - Stephen Crickard, Payroll Administrator - Beverley Yates, Human Resource Manager - Shirley Anne McFerran. The claimants confirmed to the tribunal that the Stephen Crickard named in the booklet was the one and the same named in the memo dated 4 June 2010.

14. Throughout the claimants’ employment they were never notified of any change of employer – nor did the assets of the business, which existed when they commenced employment, change or leave the premises prior to their dismissal.

15. The first named claimant’s employment commenced on 8 February 2007 and ended on 29 May 2010. She was given no prior notice that she would not have a job after 29 May 2010. She worked 26 hours per week but her gross weekly salary on the bank documentation provided averaged out at £189.00 per week gross, £155.00 per week net. Her gross hourly rate at the date of dismissal was £6.50. At the date of her actual dismissal, the claimant was 28 years old. She had been aged 25 years when she commenced her employment. The claimant had no breaks in her employment and by virtue of the Transfer of Undertakings (Protection of Employment) Regulations 2006 is deemed to have been continuously employed by the fourth named respondent from 8 February 2007. The first named claimant asked her employer about redundancy but received nothing over and above the memo dated 4 June 2010.

16. The second named claimant’s employment commenced on 2 October 2006 and ended on 29 May 2010. The second named claimant was given no prior notice that he would not have a job after 29 May 2010. The second named claimant worked variable hours per week but his gross weekly salary on the Inland Revenue and wages documentation provided averaged out at £160.59 per week gross, £153.86 per week net. At the date of his actual dismissal, the claimant was 55 years old and his gross hourly rate was £6.50. He had been aged 51 years when he commenced his employment. The claimant had no breaks in his employment and by virtue of the Transfer of Undertakings (Protection of Employment) Regulations is deemed to have been continuously employed by the fourth named respondent from 2 October 2006. The second named claimant asked his employer about redundancy but received nothing over and above the memo dated 4 June 2010 and his P45.

17. The third named claimant’s employment commenced on 3 April 2006 and ended on 29 May 2010. He was given no prior notice that he would not have a job after 29 May 2010. He worked 40 hours per week but his gross weekly salary on the bank documentation provided averaged out at approximately £270.00 per week gross, £222.00 per week net. At the date of his actual dismissal, the claimant was 29 years old. He had been aged 25 years when he commenced his employment. The claimant had no breaks in his employment and by virtue of the Transfer of Undertakings (Protection of Employment) Regulations 2006 is deemed to have been continuously employed by the fourth named respondent from 3 April 2006. The third named claimant asked his employer about redundancy but received nothing over and above the memo dated 4 June 2010.

18. The fourth named claimant’s employment commenced on 21 April 2007 and ended on 29 May 2010. She was given no prior notice that she would not have a job after 29 May 2010. She worked variable hours per week with a minimum of 20 hours per week. Her gross weekly salary on the bank documentation provided did not cover a 13 week period. However, on the four weeks provided and utilising the balance weeks by calculating 22.5 hours at the gross hourly rate of £5.83, it averaged out at £163.00 per week gross, £156.00 per week net. At the date of her actual dismissal, the claimant was 18 years old. She had been aged 15 years when she commenced her employment. The claimant had no breaks in her employment and by virtue of the Transfer of Undertakings (Protection of Employment) Regulations 2006 is deemed to have been continuously employed by the fourth named respondent from 8 February 2007. The fourth named claimant asked her employer about redundancy but received nothing over and above the memo dated 4 June 2010.

19. The fifth named claimant’s employment commenced on 1 February 2002 and ended on 29 May 2010. She was given no prior notice that she would not have a job after 29 May 2010. She worked 16 hours per week but her gross weekly salary on the bank documentation provided averaged out at £118.00 per week gross, £115.00 per week net. At the date of her actual dismissal, the claimant was 25 years old. She had been aged 16 years when she commenced her employment. The claimant had no breaks in her employment and by virtue of the Transfer of Undertakings (Protection of Employment) Regulations 2006 is deemed to have been continuously employed by the fourth named respondent from 1 February 2002. The fifth named claimant asked her employer about redundancy but received nothing over and above the memo dated 4 June 2010.

20. The fourth named respondent did not follow any dismissal procedure – and in fact made no effort to comply with the minimum requirement imposed on employers – the statutory dismissal procedure. All the claimants were dismissed without notice.

21. The claimants all gave evidence that they normally received 20 days per year holiday entitlement. This is confirmed from the Soda Joe’s staff handbook. However, the handbook was silent on when the holiday year ran from and when it ended. However, all the claimants’ statements of main terms and conditions stated that the holiday year ran from 1 April to 31 March. In addition, a document was produced at hearing dated April 2010, which had been given to one of the claimants when she queried how her holiday leave was accrued. The document sets out the manner in which leave is accrued where variable hours apply – and reflects that the entitlement for full time staff was 28 days. In essence, leave for staff on variable hours accrued at a rate of 7 minutes for each hour worked. The document ended with “Any further explanation; please contact Shirley Anne McFerran...”

22. The first named claimant had taken no holidays from 1 April 2010 prior to her dismissal and accordingly had accrued holiday leave, but had received no payment in lieu. All the other claimants equally gave evidence that they had taken no holidays from 1 April 2010 up to the date of dismissal. Accordingly, all the claimants had accrued holiday leave but had received no payment in lieu.

23. Following the termination of the first named claimant’s employment, the claimant registered for Jobseeker’s Allowance on 2 June 2010. She received Jobseeker’s Allowance for a period of 24 weeks before she successfully found employment through an Agency for 31.5 hours per week at an hourly rate of £6.22.

24. Following the termination of the second named claimant’s employment, the claimant registered for Jobseeker’s Allowance on 2 June 2010. He has been unsuccessful in finding alternative employment and gave evidence of jobs he had applied for without success. The claimant has been assessed as being entitled to Jobseeker’s Allowance which was continuing at the date of the hearing.

25. Following the termination of the third named claimant’s employment, the claimant registered for Jobseeker’s Allowance on 2 June 2010. He has been unsuccessful in finding alternative employment and gave evidence of jobs he had applied for without success. The claimant has been assessed as being entitled to Jobseeker’s Allowance which was continuing at the date of the hearing.

26. Following the termination of the fourth named claimant’s employment, the claimant registered for Jobseeker’s Allowance on 2 June 2010. She received Jobseeker’s Allowance for a period of 7 weeks before she successfully found employment with McDonalds on 24 July 2010. She currently earns more in this employment than when she was employed by the respondent although she receives a lower hourly rate - £4.85 per hour.

27. Following the termination of the fifth named claimant’s employment, the claimant registered for Jobseeker’s Allowance on 2 June 2010 but her claim was refused. She received no Jobseeker’s Allowance and she successfully found employment in June 2010 with average net pay per week of £92.00.

The Relevant Law and Decision

28. The tribunal considered the provisions of Article 130A of the Employment Rights (Northern Ireland) Order 1996 which states that an employee such as the claimant who has been dismissed shall be regarded as unfairly dismissed where the statutory dismissal procedure applied; was not completed by the respondent and the non – completion is wholly attributable to the failure of the respondent to comply with the statutory requirements. Article 130A (2) states that failure by an employer to follow the statutory dismissal procedure shall not be regarded for the purposes of Article 130 (4) of Employment Rights (Northern Ireland) Order 1996 as by itself making the employer’s action unreasonable and therefore unfair if the employer can show that the employee would have been dismissed had the procedure been followed.

Alexander and Hatherley v Bridgen Enterprises Ltd [2006]
IRLR 422 is authority for the proposition that “it is not open to an employer who is in breach of the minimum statutory procedure to contend that even had he complied with them the result would have been the same”. However, once “the statutory procedures have been complied with, employers are thereafter provided with a defence for failing to comply with fuller procedural safeguards if they can show that dismissal would have occurred anyway even had such procedures been properly followed”.

29. The reasons set out in Article 130 (2) encompass, amongst others, redundancy. Circumstances in which an employee who is dismissed shall be taken to be dismissed by reason of redundancy are set out in Article 174 of the 1996 Order and include if the dismissal is wholly or mainly attributable to the fact that his employer has ceased or intends to cease to carry on the business for the purposes of which the employee was employed, by him, or to carry on that business in the place where the employee was so employed, or if the requirements of that business for employees to carry out work of a particular kind, or in the place where the employee was employed have ceased or diminished, or are likely to do so.

30. Where the respondent has established the reason, the tribunal must determine whether the employer acted reasonably or unreasonably in treating that reason as a sufficient reason for dismissing the claimant having regard to the circumstances of this case and that question “shall be determined in accordance with equity and the substantial merits of the case”.

31. If an employer fails to follow the statutory dismissal procedure, it was held in Polkey v AE Dayton Services Ltd [1998] ICR 142, that the tribunal may reduce the compensatory award by an appropriate percentage to reflect the probability of a dismissal occurring in any event had the statutory procedure been completed. The exception to this is where the substantive reason for dismissal is redundancy.

32. In regard to the claim for pay in lieu of notice, the relevant legislation is to be found in Article 118 of the 1996 Order which provides as follows:-

“118-(1) The notice required to be given by an employer to terminate the contract of employment with the person who is being continuously employed for one month or more –

(a) is not less than one week’s notice if his period of continuous employment is less than two years;

(b) is not less than one week’s notice for each year of continuous employment if his period of continuous employment is two years or more but less than twelve years, and

Failure to pay statutory minimum notice raises a remedy under breach of contract – Westwood v Secretary of State for Employment [1984] IRLR 209.

33. As the respondent gave no notice of termination, the date of termination is governed by Article 129 (1) (b) of the Employment Rights (Northern Ireland) Order 1996 and is the date the “termination takes effect”.

34. Under Article 129 (2) where an employer has failed to give the requisite notice under Article 118 and the notice required would, if duly given on the date when the contract was terminated by the employer, mean that the contract of employment would have expired on a date later than the effective date of termination – ie, the date it was terminated – then the later date is the effective date of termination for the purpose of calculating an award under Article 153 (1).

35 The legislation in relation to the right to a redundancy payment is to be found in Articles 170 to 181 of the Employment Rights (Northern Ireland) Order 1996 (“the 1996 Order”). Under Article 180 (5) where an employer has failed to give the requisite notice under Article 118 and the notice required would, if duly given on the date when the contract was terminated by the employer, mean that the contract of employment would have expired on a date later than the “relevant date” namely the date termination takes effect – then the later date is the relevant date for the purpose of calculating an award under Article 197 (the amount of redundancy payment).

36. The legislation in relation to holiday entitlement is found in this case in the Working Time Regulations Northern Ireland 1998 as amended. From 1 April 2009 employees in the situation of the claimants were entitled to 5.6 weeks holidays – which equates to 28 days per annum, including statutory and public holidays, for those employed full time. The entitlement for those working less than full time is calculated pro-rata. Where holiday entitlement has accrued prior to dismissal an employee is entitled to pay in lieu of the holidays where they have been unable to avail of the holiday prior to the last date of their employment. The payment is calculated in accordance with Regulation 30, or the contractual provisions, whichever is the most favourable to the employee.

Applying the Law to Facts Found

37. The most difficult issue in this matter was identifying who was the claimants’ employer at the relevant date – namely 29 May 2010. While four of the five claimants were issued with statements of main terms and conditions naming Bladon Developments Limited as their employer – no such company could be found registered in Companies House in the register of companies incorporated in Northern Ireland. Ms Quigley had received a document, naming Bladon Enterprises Limited which was incorporated on 14 July 1988, as her employer in April 2007. Pay slips were issued to the claimants with Company name Bladon Enterprises. Those claimants who received a P45 received a document with the name of their employer completed as Bladon Enterprises t/a Soda Joe’s. The task of the tribunal was not assisted by the obfuscation on the part of the respondents, including Stephen Crickard in his memo date 4 June 2010 – when he identified to the claimants the third named respondent as their employer. There was clear evidence before the tribunal that the fourth named respondent had power to determine disciplinary action against employees of Soda Joe’s Restaurant – taking in to account the letters provided to the tribunal dated 2008 and 2009. The first paragraph of the reference provided to Mr Hutton on headed notepaper of Sheridan Entertainments Limited read “Graham Hutton was employed by us from 9 March 2006 until 31 May 2010 as General Manager of Soda Joe’s in the Odyssey Pavilion until he was made redundant”. There was clear evidence the claimants were under a personal obligation to carry out their duties and were subject to direction from Mr Hutton and staff employed in Sheridan Entertainments Limited. Sheridan Entertainments Limited considered themselves obligated to pay the wages of the claimants for work done at the end of April, throughout May and early June 2010.

38. It is difficult for the tribunal to conclude anything other than those completing these P45 forms did so knowing that the information included was inaccurate. The tribunal took particular notice of the documents and evidence provided by Mr Boreland. He provided clear evidence that the third named respondent was not the employer of these claimants. Further, he provided clear evidence that the company paying the salary of the claimants throughout May and into June 2010 was the fourth named respondent. His evidence confirmed that of Mr Hutton and the claimants that staff of the fourth named respondent were involved in the obtaining of the keys to the restaurant premises and their return to the relevant estate agents.

39. On consideration of all the evidence before it, the tribunal is satisfied on the balance of probabilities, that the fourth named respondent assumed the role of employer of the staff at Soda Joe’s Restaurant at various times throughout their employment and in particular by the end of April 2010. This contractual role continued right through to the date of dismissal as that respondent exercised the control and discharged the obligations expected of an employer. Therefore the claimants were employed and dismissed by the fourth named respondent at the relevant time and its failure to adhere to the statutory dismissal procedure means their dismissal must be viewed as automatically unfair.

40. The tribunal is satisfied that all of the claimants were dismissed by reason of a redundancy as defined in Article 174 of the 1996 Order, the respondent ceasing to carry on business for the purposes for which they were required. There was no other reason tendered by the fourth named respondent, to the claimants, to explain its failure to comply with its obligations under the Employment Rights (Northern Ireland) Order 1996 as amended. In all the circumstances of this case the tribunal determined that the date of effective termination for all the claimants’ employment was 29 May 2010.

41. It was clear to the tribunal that had the fourth named respondent attempted to adhere to the statutory dismissal procedures – including the right to an appeal - it was more than likely that all the claimants would have been employed for a further short period. However, the tribunal could not rule out that such an extension of the claimants’ employment would be no longer than a week. All the claimants sought compensation only as a remedy. The fact that all those employed in Soda Joe’s Restaurant were dismissed at the same time as the claimants, the tribunal concluded that any immediate or future economic loss was unlikely to extend beyond one week from the date their employment was terminated.

42. The tribunal concluded from the available evidence that the fourth named respondent’s holiday year ran from 1 April to 31 March. Accordingly the first named claimant has accrued holiday entitlement from 1 April 2010 to the 29 May 2010. This is calculated as an eight week period during which she worked 26 hours per week. This calculated as 208 x 7 min = 1456 mins = 24.26 hours. The gross hourly rate for this claimant was £6.50. The tribunal determined as best they could that the net hourly rate was approximately £5.50 – considering the wages accrued for all the claimants in the last weeks of their employment. As the first named claimant had availed of no annual leave, she was deprived of the sum of £133.46 net in respect of untaken holiday leave.

43. The second named claimant has accrued holiday entitlement from 1 April 2010 to the 29 May 2010. This is calculated as an eight week period during which he worked 26 hours per week. This calculated as 208 x 7 min = 1456 mins = 24.26 hours. The gross hourly rate for this claimant was £6.50. The tribunal determined as best they could that the net hourly rate was approximately £5.50 – considering the wages accrued for all the claimants in the last weeks of their employment. As the second named claimant had availed of no annual leave, he was deprived of the sum of £133.46 net in respect of untaken holiday leave.

44. The third named claimant has accrued holiday entitlement from 1 April 2010 to the 29 May 2010. As the third named claimant worked 40 hours per week his entitlement is calculated, not on the variable methodology, but on the full rate basis. The calculation is the leave entitlement (28 days) multiplied by the proportion of working days completed in the leave year before the date of termination. On the basis that this claimant worked a five day week, there were available 260 working days in a year and 41 working days had passed between 1 April 2010 and 29 May 2010. Therefore this claimant was entitled to 41/260X28 = 4.41 say 4.5 days. The claimant’s daily net rate of pay was determined as £41.63. The third named claimant had availed of no annual leave from 1 April and accordingly the third named claimant was deprived of the sum of £187.33 net, say £188 in respect of untaken holiday leave.

45. The fourth named claimant has accrued holiday entitlement from 1 April 2010 to the 29 May 2010. This is calculated as an eight week period during which she worked on average in that period – 4 weeks at 27 hours per week and four weeks assumed to be at the median of 22 hours per week as no pay details for that period were available. This calculated as 196 x 7 min = 1372 mins = 22.86 hours, say 23 hours. The gross hourly rate for this claimant was £5.83. The tribunal determined as best they could that the net hourly rate was approximately £5.50 – considering the wages accrued for all the claimants in the last weeks of their employment. As the fourth named claimant had availed of no annual leave, she was deprived of the sum of £126.50 net in respect of untaken holiday leave.

46. The fifth named claimant has accrued holiday entitlement from 1 April 2010 to the 29 May 2010. This is calculated as an eight week period during which she worked 16 hours per week. This calculated as 128 x 7 min = 896 mins = 14.93 hours, say 15 hours. The gross hourly rate for this claimant was £6.50. The tribunal determined as best they could that the net hourly rate was approximately £5.50 – considering the wages accrued for all the claimants in the last weeks of their employment. As the fifth named claimant had availed of no annual leave, she was deprived of the sum of £82.50 net in respect of untaken holiday leave.

47. In the event that an employer is unable for some reason to allow the employee to work their full notice as specified in the 1996 Order, the employee is entitled to be paid in lieu of notice. In this case the first named claimant had worked for the employer for three complete years and accordingly was entitled to 3 weeks’ notice. Given that her average net pay was approximately £155.00 per week; she was entitled to a payment of £465.00 in respect of notice pay. The second named claimant had worked for four complete years by 29 May 2010. Given that his net pay was £154.00 per week, he was entitled to a payment of £616.00 in respect of notice pay. The third named claimant had worked for four complete years of service at a net weekly wage of £222.00. Accordingly he was entitled to a payment of £888.00 in respect of pay in lieu of notice. The fourth named claimant had worked three complete years at a net weekly wage of £137.00. Accordingly she was entitled to a payment of £411.00 in lieu of notice. The fifth named claimant had eight years complete service and a weekly net wage of £115. Accordingly she was entitled to a payment of £920.00 in lieu of notice.

Award first named claimant

Basic Award

48. The tribunal considered Articles 17 to 20, 146, 152, 153, 154 (1A) and (1B) and 157 to 162 of the Employment Rights (Northern Ireland) Order 1996. The tribunal considered the provisions for adjustment of awards where there has been non– completion of statutory procedure as detailed in Articles 17, 23 and 29 of the Employment (Northern Ireland) Order 2003. There was a clear flouting of the Statutory Dismissal Procedure by the fourth named respondent. There was no break in any of the claimants’ continuity of employment. The first named claimant had three complete years of service, commencing when she was aged 25 years. This would have entitled the claimant to one week’s gross pay for each of the three years service as the basic award. In those circumstances the tribunal considered and determined that the enhanced award in accordance with the provisions of Article 154 (1A) and (1B) of the Employment Rights (Northern Ireland) Order 1996 as amended was just and appropriate.

49. The first named claimant is entitled to a payment representing four weeks gross pay – 4 x gross weeks pay namely £162.00 = £648.00

Compensatory Award

50. The evidence before the tribunal leads to the conclusion, on the balance of probabilities, that had the fourth named respondent followed a fair procedure the claimant would have been dismissed in any event, perhaps within a week of the actual date of termination, but with notice or monies in lieu of same. The clear reason for dismissal was the redundancy situation which had arisen within the respondent company. The circumstances of Article 174 (1) applied to the circumstances of the dismissals of all these claimants. Article 118B of the 1996 Order implies a minimum notice requirement of one week’s net pay for each complete year of service into the claimant’s contract of employment with the respondent. The claimant did not receive proper notice of termination of her employment from the respondent. Further the failure to follow the statutory dismissal procedure prevented the claimant from receiving pay for at least a further one week period. It appeared to the tribunal that it was “just and equitable” to restrict the claimant’s loss due to the actions of the fourth named respondent to the loss of pay for that one week period. The claimant was entitled to one week’s net pay being £155.00 while a statutory dismissal procedure was effected. In the circumstances of the fourth named respondent and the economic climate the tribunal does not consider that it would be just and equitable to include any further monies for future economic loss other than an award should be made in respect of loss of statutory rights in the sum of £200.00.

51. The tribunal is satisfied that the provisions of Article 17 (3) of the 2003 Order are satisfied. Article 158A is clear that this duty to increase arises in respect of the compensatory award (Article 152 (1) (b)). There are no exceptional circumstances in this case that would make a requisite increase in the compensatory award unjust or inequitable. The respondent in this case showed a total disregard for the claimant’s employment rights. There is little guidance as to the factors to be taken into account in determining whether it is just and equitable in all the circumstances to increase any award from the prescribed ten percent by an amount that does not exceed fifty percent. This tribunal has taken into account the social policy that underlies the introduction of this statutory procedure and the circumstances of this case. The picture the tribunal has obtained of the fourth named respondent organisation is that the fourth named respondent had a cavalier attitude to its statutory obligations. This tribunal has concluded that this case is as suitable a case as any that might arise in the future where it is just and equitable to increase any award that may be made. It is difficult to envisage all the circumstances, due to the lack of case law on this issue, where an increase over and above the ten percent might arise but this tribunal determined that this was such a case and considers the appropriate uplift in the compensatory award in this case is twenty five percent.

Basic Award (as per Article 154 (1A))

4 x weeks pay @ £162 £648.00

Compensatory Award

One week’s net pay @ £155.00

Loss of statutory rights £200 £355.00

25% increase on £355.00(as per Article 158A) £88.75

Pay in lieu of notice £465.00

Pay in lieu of holiday leave £133.46

Total Award £1,690.21

Award second named claimant

Basic Award

52. There was no break to the second named claimant’s continuity of employment. His employment commenced when he was aged 51 years. The second named claimant is entitled to a payment calculated in accordance with Article 154 of the 1996 Order and the Employment Rights (Increase of Limits) Order (Northern Ireland) 2009 No.45. This entitles the second named claimant to the basic award of one and a half weeks gross pay for each of the four years service when he was aged over 41. In those circumstances the tribunal ruled out making any award in accordance with the provisions of Article 154 (1A) and (1B).

6 x gross weeks pay namely £161.00 = £966.00

Compensatory Award

53. The same rationale as set out in paragraphs 49 to 51 for the compensatory award of the first named claimant apply to this claimant. Article 118B of the 1996 Order implies a minimum notice requirement of four weeks in to the claimant’s contract of employment with the respondent.

Basic Award

6 x weeks pay @ £161.00 £966.00

Compensatory Award

One week’s net pay @ £154.00

Loss of Statutory Rights £200.00 £354.00

25% increase on £354.00(as per Article 158A) £88.50

Pay in lieu of notice £616.00

Pay in lieu of holiday leave £133.46

Total Award £2,157.96

Award third named claimant

Basic Award

54. There was no break to the third named claimant’s continuity of employment. His employment commenced when he was aged 25 years. The third named claimant is entitled to a payment calculated in accordance with Article 154 of the 1996 Order and the Employment Rights (Increase of Limits) Order (Northern Ireland) 2009 No.45. This entitles the third named claimant to the basic award of one week’s gross pay for each of the 4 years service when he was aged under 41 but over 21 years. In those circumstances the tribunal ruled out making any award in accordance with the provisions of Article 154 (1A) and (1B).

4 x gross weeks pay namely £270.00 = £1,080.00

Compensatory Award

55. The same rationale as set out in paragraphs 49 to 51 for the compensatory award of the first named claimant apply to this claimant. Article 118B of the 1996 Order implies a minimum notice requirement of four weeks in to the claimant’s contract of employment with the respondent.

Basic Award

4x weeks pay @ £270.00 £1,080.00

Compensatory Award

One week’s net pay @ £222.00

Loss of Statutory Rights £200.00 £422.00

25% increase on £354.00(as per Article 158A) £105.50

Pay in lieu of notice £888.00

Pay in lieu of holiday leave £ 188.00

Total Award £2,683.50

Award fourth named claimant

Basic Award

56. There was no break to the fourth named claimant’s continuity of employment. Her employment commenced when she was aged 15 years. The fourth named claimant would have been entitled to a half week’s gross pay for each of the three years service as the basic award. In those circumstances the tribunal considered and determined that the enhanced award in accordance with the provisions of Article 154 (1A) and (1B) of the Employment Rights (Northern Ireland) Order 1996 as amended was just and appropriate.

4 x gross weeks pay namely £142.00 = £568.00

Compensatory Award

57. The same rationale as set out in paragraphs 49 to 51 for the compensatory award of the first named claimant apply to this claimant. Article 118B of the 1996 Order implies a minimum notice requirement of three weeks in to the claimant’s contract of employment with the respondent.

Basic Award

4x weeks pay @ £142.00 £568.00

Compensatory Award

One week’s net pay @ £137.00

Loss of Statutory Rights £200.00 £337.00

25% increase on £337.00(as per Article 158A) £84.25

Pay in lieu of notice £411.00

Pay in lieu of holiday leave £126.50

Total Award £1,526.75

Award fifth named claimant

Basic Award

58. There was no break to the fifth named claimant’s continuity of employment. Her employment commenced when he was aged 16 years. The fifth named claimant is entitled to a payment calculated in accordance with Article 154 of the 1996 Order and the Employment Rights (Increase of Limits) Order (Northern Ireland) 2009 No.45. This entitles the fifth named claimant to the basic award of one weeks gross pay for each complete year of service when she was aged over 21 years and a half weeks gross pay for each of the five years service when she was aged 21 and under. In those circumstances the tribunal ruled out making any award in accordance with the provisions of Article 154 (1A) and (1B).

51/2 x gross weeks pay namely £118.00 = £649.00

Compensatory Award

59. The same rationale as set out in paragraphs 49 to 51 for the compensatory award of the first named claimant apply to this claimant. Article 118B of the 1996 Order implies a minimum notice requirement of four weeks in to the claimant’s contract of employment with the respondent.

Basic Award

51/2 x weeks pay @ £118.00 £649.00

Compensatory Award

One week’s net pay @ £115.00

Loss of Statutory Rights £200.00 £315.00

25% increase on £315.00(as per Article 158A) £78.75

Pay in lieu of notice £920.00

Pay in lieu of holiday leave £ 82.50

Total Award £2,045.25

60. The tribunal orders that the first, second, third and fifth named respondents be dismissed from these proceedings as they were not the employer of the claimants at the relevant date of dismissal.

61. The Employment Protection (Recoupment of Job Seeker’s Allowance and Income Support) Regulations (Northern Ireland) 1996 apply to this decision as all of the claimants registered for same on 2 June 2010. All but the fifth named claimant received Jobseeker’s Allowance. The first named claimant received Jobseeker’s Allowance from the 2 June 2010 until the 22 November 2010 when she then gained employment. Accordingly the monetary award for the first named claimant is £1,690.21. The amount of the prescribed element is £155.00. The prescribed period is the 2 June 2010 until 9 June 2010. The amount the award exceeds the prescribed element is £1,535.21. The second named claimant received Jobseeker’s Allowance from the 2 June 2010 onwards. The monetary award for the second named claimant is £2,157.96. The amount of the prescribed element is £154.00. The prescribed period is the 2 June 2010 until 9 June 2010. The amount the award exceeds the prescribed element is £2,003.96. The third named claimant received Jobseeker’s Allowance from the 2 June 2010 onwards. Accordingly the monetary award for the third named claimant is £2,683.50. The amount of the prescribed element is £222.00. The prescribed period is the 2 June 2010 until 9 June 2010. The amount the award exceeds the prescribed element is £2,461.50. The fourth named claimant received Jobseeker’s Allowance from the 2 June 2010 until the 25 July 2010 when she then gained employment. Accordingly the monetary award for the fourth named claimant is £1,526.75. The amount of the prescribed element is £137.00. The prescribed period is the 2 June 2010 until 9 June 2010. The amount the award exceeds the prescribed element is £1,389.75. The recoupment regulations do not apply to the award made to the fifth named claimant as she did not receive Jobseeker’s Allowance.

62. The clear reason for the dismissal of these claimants was redundancy. The claimants are not entitled to be compensated twice – and therefore had they received redundancy payments, such sums would have had to be deducted from their basic award as determined by this tribunal. However none of the claimants received any redundancy payments – but would have been entitled to same in the following amounts – first named claimant - £486.00; the second named claimant - £966.00; the third named claimant - £1,080.00; the fourth named claimant, had she been given the appropriate notice she was entitled to would have been aged 19 at the relevant date of termination and therefore entitled to one and a half weeks gross pay - £213.00 and the fifth named claimant – £649.00.

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

Chairman:

Date and place of hearing: 29 November 2010 and 17 January 2011, Belfast.

Date decision recorded in the register and issued to the parties:

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	Industrial Tribunals Northern Ireland Decisions
You are here: BAILII >> Databases >> Industrial Tribunals Northern Ireland Decisions >> Killen v Bladon Enterprises t/a Soda Jo... [2010] NIIT 01879_10IT (04 March 2011) URL: http://www.bailii.org/nie/cases/NIIT/2011/01879_10IT.html Cite as: [2010] NIIT 01879_10IT, [2010] NIIT 1879_10IT

Industrial Tribunals Northern Ireland Decisions