A recent decision of the Employment Appeals Tribunal held that a letter drafted for an employee for social welfare purposes stating that the employer “had no work available at present” was, in fact, notice of redundancy. As a result, the employee was entitled to a redundancy payment. We take a look at this interesting case.
The Employment Appeals Tribunal (EAT) recently held that a letter written for an employee for social welfare purposes stating that the employer “had no work available at present” constituted a notice of redundancy. The EAT held that the employee was entitled to a redundancy payment even though the employer argued that it never intended to make the employee redundant and that there was, in fact, work available for him.
The case involved an employee, Mr O’Donnell, of Barnes Limestone Quarry Limited (Barnes). Mr O'Donnell had been employed by Barnes as a lorry driver since 1998. He was initially employed on a full-time basis, however, over the years his hours had been reduced and by March 2013, he was only working one or two days a week. By May 2014, the quarry in which Mr O’Donnell worked was closed.
Mr O’Donnell requested that he be made redundant on a number of occasions throughout 2014. However, Barnes refused these requests stating that “the company couldn’t afford it".
Mr O’Donnell subsequently asked Barnes for a letter to support his application for social welfare. Barnes initially declined saying that Mr O’Donnell would “use it to seek redundancy”. Mr O’Donnell, however, assured Barnes that the letter would be used for social welfare purposes only. Eventually, Barnes agreed and drafted a letter, dated 13 October 2014, saying that it “had no work available at present”.
At the hearing, Barnes stated that the contents of that letter were untrue. It stated that there was in fact work available and that a new site had opened following the closure of the first site. Barnes also stated that, in September 2014, its employees were transferred to a new company and offered new contracts but that Mr O’Donnell had refused to sign his contract.
The EAT noted that there was a serious conflict of evidence as to how Mr O’Donnell’s employment came to an end, however, it did not accept that he voluntarily resigned from employment.
The EAT considered the letter of 13 October 2014 to determine whether it could be considered notice of redundancy.
A majority of the EAT held that “on balance…the letter of 13 October - combined with the fact that” Mr O’Donnell “was only doing one day per week or on occasion no work at all, constitutes notice of redundancy”.
There was one dissenting member of the EAT who was of the view that there was “no evidence that” Mr O’Donnell “met the criteria as required in the Redundancy Payments Acts 1967 to 2007. He requested a letter from his employer dated 13 October and got paid for one day after receiving the letter so was on lay-off or short time...In these circumstances it would be unfair to find the claimant redundant”.
This case serves as a useful warning to employers who may be asked to write letters for employees, for example, to assist with a social welfare application. Such letters may have unintended consequences, as it did here, where the estimated cost to the employer was around €10,000.
If employers are asked to write letters on behalf of employees, the employer should firstly consider whether a letter is actually necessary for the stated purpose. For example, it may be the case that an employee's payslips would be a suitable alternative in the circumstances.
Where an employer writes such a letter, it should ensure that the information contained within it is factually correct. If the employer has any concerns about whether the letter could have any other legal implications, it should seek legal advice before giving it to the employee.
For more information, please contact a member of our Employment Law and Benefits team.
The content of this article is provided for information purposes only and does not constitute legal or other advice.