Williamson v MMK International Transport Lt... [2009] NIIT 84

THE INDUSTRIAL TRIBUNALS

CASE REF: 00084/08

CLAIMANT: Stewart Williamson

RESPONDENT: MMK International Transport Ltd

DECISION

The unanimous decision of the tribunal is that the claimant was unfairly dismissed and the tribunal awards compensation in the sum of £2,960.00.

Constitution of Tribunal:

Chairman: Mrs A Wilson

Members: Mr J Nicholl

Ms F Graham

Appearances:

The claimant appeared in person and was unrepresented.

The respondent was represented by Ms Lamont, Barrister-at-Law, instructed by McShane & Company, Solicitors.

The issues

(i) Was the claimant dismissed by reason of redundancy?

(ii) If the claimant was so dismissed was the claimant fairly selected for redundancy?

(iii) If the claimant was not dismissed by reason of redundancy, has the respondent shown what the reason was for dismissal?

(iv) Was the dismissal fair in all the circumstances of the case?

(v) If the claimant was unfairly dismissed, what compensation if any is due to him.

Sources of evidence

1. The tribunal considered the claim form, the response, documents handed in and referred to by the parties during the course of the proceedings, sworn testimony of Mr McKenna and Mr Tyrie for the respondent, sworn testimony of the claimant and the submissions of the parties.

Contentions of the parties and findings of relevant facts

2. The respondent is a haulage company operating out of Portadown, Co Armagh.

3. The claimant commenced employment with the respondent as a long distance haulage driver, driving a Class 1 vehicle on 2 October 2006.

4. His employment was terminated on 9 October 2007. He received one week’s pay in lieu of notice and at that time he was earning £648.13 gross, £500.00 net per week.

5. It is the respondent's case that the claimant was dismissed by reason of redundancy. It is the claimant's case that he was unfairly dismissed by reason of the fact that there was not a genuine redundancy situation or, in the alternative, if there was a genuine redundancy situation that he was unfairly selected for redundancy.

6. During his employment the claimant was based in England and for the most part worked transporting merchandise between warehouses and docks including the docks at Birkenhead and Fleetwood as part of a contract between the respondent and TNT. He also worked from time to time in connection with a contract with the High Street retailer, New Look.

7. New Look operated out of warehouses, one in Doncaster and one in Stoke, and there were two drivers, Kenny Tyrie and Stuart Lockhart, working exclusively on the New Look contract. Kenny Tyrie worked also as operations manager for the UK.

8. The claimant did not work weekends returning with his lorry to Northern Ireland at the end of each week.

9.. In or around August 2007, New Look closed their Doncaster warehouse and moved their Doncaster business to Stoke. The respondent received two weeks notice of this re-organisation.

10. The respondent anticipated a knock on effect of this reorganisation on business and after a couple of weeks it is their case that, because of the shorter travelling distance between Stoke and the ports, drivers were able to increase the number of runs undertaken on a daily basis as a result of which fewer drivers were required.

11. Stuart Lockhart was dismissed in or around this time on the basis that he was employed exclusively on the New Look contract and, unlike Kenny Tyrie, did not have any other role. In addition, he was employed to work weekends and weekend work had dried up.

12. It is the respondent's case that one other driver had to be let go and in selecting that person the respondent consulted with Kenny Tyrie in relation to employee disciplinary records, records of work-related traffic accident claims and other non-specified ‘problems’ encountered.

13. The respondent did not have any policy in place for handling redundancies or any procedures for the selection process. The method of selection was drawn up between Mr McKinney and Mr Tyrie and in circumstances where no disciplinary records were kept by the respondent the tribunal are concerned to find that employee disciplinary history was a selection criterion.

14. The claimant had a clear disciplinary record insofar as he had received no warnings formal or otherwise and was never subject to any disciplinary procedures. It is the respondents case that Mr Tyrie was about to give the claimant a warning regarding his behaviour in parking his trailer contrary to company and customer policy in or around this time. The claimant had parked his trailer on the roadside which is strictly forbidden by company rules and has potential to seriously damage the business of the respondent particularly in relation to the TNT contract. The respondent had received a complaint from TNT relating to this incident.

15. Mr Tyrie was admitted to hospital which prevented him from giving the intended warning. However the fact that both Mr Tyrie and Mr McKinney had reprimanded the claimant in respect of this incident the tribunal have no evidence to suggest either had mentioned the possibility of a warning or any further consideration of the incident.

16. Notwithstanding this it is the respondent's case that Mr McKinney had taken a very serious view of the incident and in his own words "couldn’t take a chance on it happening again". Based on this evidence, the tribunal find that on the balance of probabilities this incident was a material consideration in the decision to dismiss the claimant.

17. It is the respondent’s case that incidents relating to the claimant's driving hours and issues regarding punctuality were also taken into account in the decision to dismiss despite the fact that the claimant had never been formally investigated or disciplined in relation to such matters or at all and no records were kept in relation to such matters in relation to the claimant or any other employee.

18. Work-related traffic accidents involving UK based drivers of Class 1 vehicles which resulted in claims against the company insurance policy was a selection criterion. The claimant had been involved in a work-related traffic accident in March 2007 involving a claim in excess of £12,000.00 against the company insurance policy. Other drivers had been involved in accidents resulting in claims including one in excess of £16,000.00. However the claimant was the only UK-based driver of a Class 1 vehicle with a claims record. The tribunal have been presented with no evidence to explain the application of this very narrow criterion and the tribunal find on the balance of probabilities that it was subjective.

19. The claimant received a telephone call on 29 September 2007 from Mr McKinney informing him that he was dismissed due to a downturn in work in England. He received one week’s pay in lieu of notice and the effective date of termination of his employment was 6 October 2007.

20. The claimant wrote to Mr McKinney on 10 October 2007 appealing the decision to dismiss and raising questions regarding plans put in place by the respondent to have his work carried out by others including a firm of independent sub-contractors called ‘Team event’.

21. The claimant received a letter in reply dated 15 October 2007 confirming his dismissal and informing him that nobody had been recruited permanently to replace him. It was confirmed that a newly recruited member of staff [Mr Patterson] was used to cover Kenny Tyrie's sick leave and the annual leave of another employee.

22. Mr Patterson [as referred to at Paragraph 21 above] was recruited by the respondent on 15 October 2007 as a driver to cover work expected to be generated by the opening of a new depot in Portlaoise which had been delayed due to difficulties with the proposed lease.

23. No efforts were made to relocate the claimant within the respondent company.

24. No procedures were followed by the respondent in connection with the dismissal.

25. The claimant secured alternative work with Heron Transport on 27 October 2007 on comparable rates of take home pay.

The law

26. The law relating to redundancy is enshrined in the Employment Rights (Northern Ireland) Order 1996 at Article 170 which provides :-

The right

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.

Redundancy for the purposes of Article 170 is defined within Article 174 as follows:-

Redundancy

74. (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.

27. Dismissal by reason of redundancy is also subject to the law of unfair dismissal as enshrined in the Employment Rights (Northern Ireland ) Order 1996.

28. Article 130 applies which requires the employer to show the reason for the dismissal and Article 130(2)(c) provides that redundancy is a potentially fair reason.

29. Article 130(4) also applies and provides that the determination of the question whether the dismissal is fair or unfair (having regard to the reason shown by the employer):-

(a) depends on whether in the circumstances (including the size and administrative resources of the employer's undertaking) the employer acted reasonably or unreasonably in treating it as a sufficient reason for dismissing the employee, and

(b) shall be determined in accordance with equity and the substantial merits of the case.

Article 130A applies and provides:-

(1) An employee who is dismissed shall be regarded for the purposes of this Part as unfairly dismissed if –

(a) one of the procedures set out in Part I of Schedule 1 to the Employment (Northern Ireland) Order 2003 (dismissal and disciplinary procedures) applies in relation to the dismissal,

(b) the procedure has not been completed, and

(c) the non-completion of the procedure is wholly or mainly attributable to failure by the employer to comply with its requirements.

30. The statutory disciplinary and dismissal procedures as referred to in Article 130A are set out in the Employment (Northern Ireland) Order 2003 (Dispute Resolution) Regulations and Employment (Northern Ireland) Order 2003.

31. If the employer fails to follow the statutory procedure, the tribunal must make a finding of unfair dismissal and comply with the provisions of Article 146(5) of the Order which provides:-

(5) Where –

(a) an employee is regarded as unfairly dismissed by virtue of Article 130A(1) (whether or not his dismissal is unfair or regarded as unfair for any other reason),

(b) an award of compensation falls to be made under Article 146(4), and

the industrial tribunal shall, subject to Paragraph (1B), increase the award under Article 152(1)(a) to the amount of four weeks' pay.

(1B) An industrial tribunal shall not be required by Paragraph (1A) to increase the amount of an award if it considers that the increase would result in injustice to the employer.]

The tribunal have considered the provisions of 1B and find no evidence of injustice to the respondent.

32. The tribunal must also increase any award which it makes to the employee by 10%, and if it considers it just and equitable in the circumstances, by a larger percentage up to a maximum of 50%. The percentage increase must be made unless there are exceptional circumstances which would make the increase of 10% minimum unjust or inequitable (Article 17 of the 2003 Order).

Conclusions based on the applicable law

33. The tribunal find that this was not a dismissal for reasons of redundancy within the meaning of Article 174(1)(a) of the Employment Rights (Northern Ireland ) Order 1996 .

The respondent at the time of dismissal had not ceased [and the tribunal have no evidence that they intended to cease] to carry on a haulage business requiring drivers.

Furthermore that business continued to operate in the UK which is where the claimant was based. The tribunal are mindful of the fact that the New Look Warehouse at Doncaster moved to their Stoke site and have considered whether this gave rise to a diminution in the needs of the business within the meaning of Article 174(1)(b) of the Order. Diminution in the needs of the business for the purposes of the Order requires a diminution in the needs of the business overall .

34. The tribunal find that the respondent continued to require drivers and immediately subsequent to the claimant's dismissal recruited a driver who was transferred to work in England. The tribunal accept that this was to cover a period of sick leave. However the tribunal find the fact that a driver was recruited at the same time as the claimant was being dismissed to be inconsistent with the respondent's case that there was a diminution in the needs of the business for drivers such as the claimant.

35. In any event the tribunal are mindful that dismissal for reasons of redundancy in accordance with Article 174(1) requires that the dismissal is ‘wholly or mainly attributable’ to. a cessation or diminution in business. The tribunal find that this was not the case here. In reliance on Mr McKinney’s evidence referred to at Paragraph 16 and the selection process relied upon and described in detail above the tribunal find that on the balance of probabilities that dismissal was for reasons related to ~~the~~ conduct rather than any reason wholly or mainly attributed to a redundancy situation.

36. The tribunal have considered the procedures followed by the respondent which must be shown to be fair in accordance with Article 130 of the Order. On this basis the tribunal find that even if the claimant had been dismissed by reason of redundancy, the respondent acted unreasonably in not offering him suitable alternative employment which was instead allocated to a newly recruited employee.

37. Furthermore the selection process used by the respondent was unfair in the following respects:-

(i) There was no consultation with the claimant or at all.

(ii) The respondent had no redundancy policy or procedures in place.

(iii) The method of selection was subjective and flawed insofar as it related to disciplinary records when no such records were kept and the criterion relating to traffic accidents was so narrow as to apply solely to the claimant. The tribunal find that on the balance of probabilities that the criteria was set by the respondent with the claimant in mind .

38. The statutory dismissal procedures were not followed and as a consequence Article 130A applies and the dismissal of the claimant is automatically unfair under this heading.

39. Having found that the claimant was not dismissed by reason of redundancy, the tribunal find that the respondent has not complied with Article 130 and as a consequence find that the claimant was unfairly dismissed.

Compensation

40. The tribunal have calculated compensation in accordance with Articles 152 to 158A of the Order and Article 17 of the 2003 Order as follows:-

The basic award

Article 153 of the Order sets out the formula by which such basic award is to be calculated.

The basic award in this case according to this formula is:-

One full year of employment [02/10/2006 - 09/10/2007] at £500.00 net per week.

The statutory maximum of £350.00 is applied [+ £350 x 3 =1,050.00 in respect of failure to follow statutory procedures as outlined at paragraph 310 above] = £1,400.00

Total Basic Award = £1400.00

The compensatory award

Article 157(1) provides that the amount of the compensatory award shall be such amount as the tribunal considers just and equitable in all the circumstances having regard to the loss sustained by the claimant in consequence of the dismissal in so far as that loss is attributable to action taken by the employer".

The claimant’s was dismissed on 9 October 2007 and was unemployed for three weeks. In these circumstances the tribunal awards the claimant compensation at the rate of £350.00 [the statutory maximum] for three weeks amounting to £1,050.00.

Compensation for loss of statutory rights = £250.00.

Total Compensatory Award = £1,300.00

The tribunal have considered the effect of failure to follow the statutory procedures on the amount of the award in accordance with Article 17(3)of the Employment (Northern Ireland ) Order 2003 as outlined at Paragraph 30 above.

Article 17(3) applies here and the tribunal award the claimant a percentage uplift of 10% and award a further 10% uplift having considered the matter on just and equitable grounds against a background where the respondent who runs a successful business made absolutely no attempt to acknowledge or observe the statutory procedures .

The tribunal have considered the provisions of Article 17(4) and find that it does not apply in this case due to the lack of any exceptional circumstances.

Total amount of compensatory award after uplift = £1,560.00 [£1,300 + £260]

Total award to include basic and compensatory = £2,960.00

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

Chairman:

Date and place of hearing: 23 October 2009, Belfast

Date decision recorded in register and issued to parties:

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You are here: BAILII >> Databases >> Industrial Tribunals Northern Ireland Decisions >> Williamson v MMK International Transport Lt... [2009] NIIT 84_08IT (25 November 2009) URL: http://www.bailii.org/nie/cases/NIIT/2009/84_08IT.html Cite as: [2009] NIIT 84_8IT, [2009] NIIT 84_08IT

Industrial Tribunals Northern Ireland Decisions