Employment Law Solicitors – Employment Injunctions for Employees.*
This issue arose in a case of Lorcan Delaney and Aer Lingus (Ireland) Limited, in the High Court 2021 IEHC 72.
It appears that in June 2019 Mr Delaney who was employed by Aer Lingus as a cabin crew member went to a music festival. He was found by a member of An Garda Siochana to be in possession of a small quantity of cannabis. One of the consequences of being found in possession of these substances was to block the renewal of his DAA Airport Identification Card. This is a security pass which allows the holder to restricted areas at airports. The renewal of the cards requires Garda vetting.
On the 10th December 2019, Richard Delaney who could no longer fly was told that he was being placed on unpaid leave until such time that he received a new card. It appears his card was not renewed because there was an outstanding summons for him to appear at Trim District Court on the 26th May 2020 to answer a complaint under Section 3 of the Misuse of Drugs Act, 1977. The company took the view that without a DAA Airport Identification Card, Mr Delaney could not work as a cabin crew member and by a letter dated the 20th February 2020 Mr Delaney was told he was dismissed with effect from 21st February 2020 and would be paid salary in lieu of notice.
The Plaintiff argued that the dismissal was invalid. One of the grounds was frustration of contract put forward by the company.
The High Court held that the frustration argument was easily disposed of. The Court stated that while the Personnel Officer who wrote the letter did refer to “frustration of contract” it was quite clear that he was not invoking the legal definition of frustration. Legally, as the Court pointed out, frustration occurs where without default by either party and by reason of unexpected occurrence, a contractual obligation has become incapable of being performed. In this case the Court pointed out the requirement that Mr Delaney should renew his security pass was obvious from the expiry date. The need for a new card was plainly known to Mr Delaney. More immediately as the Court pointed out if the expiry of the security card had legally frustrated the contract the contract would have been discharged by operation of law on the 10th December 2019 and that was not the position taken by the Defendant. Rather the fact that Mr Delaney did not have a card was relied upon as a reason for his dismissal or purported dismissal. In other words, the contract was plainly terminated or purportedly terminated by an act of the defendant and not by law. The Court pointed out as to whether by reason of the fact that Mr Delaney’s card had not been renewed the contract of employment was incapable of performance by him is a separate issue. The Court pointed out that while the letter identified the requirement for Mr Delaney to have a current Airside Access Card as a fundamental term, there was no suggestion that his contract of employment might have been discharged by the acceptance by the Defendant of a fundamental breach.
The Court pointed out that the proposition appears to have been made that so long as Mr Delaney was not able to do the work which he had been employed to do, where he had been employed to do it, the Defendant had to find some other work, elsewhere, for him to do. The Court pointed out that if Mr Delaney’s contract of employment did not provide that he could be placed on unpaid leave, neither did it provide that the Defendant was obliged to redeploy him.
It was argued that the decision to dismiss was unwarranted because the Defendant would have suffered no prejudice by leaving him on the books as he was on unpaid leave. The Court pointed out that if this is an appeal to fairness that Mr Delaney was in the wrong forum. It was argued that there was an internal mechanism which would be available to resolve disputes. The Court pointed out that Mr Delaney had set his face against that process.
The Court pointed out that the orders being sought on behalf of the Plaintiff were mandatory orders. The Court pointed out it is necessary and properly accepted that to engage the jurisdiction of the Court you must go further than establishing a fair question to be tried but must show that he has a strong case that is likely to succeed at the hearing of the action. The case of Maha Lingham -v- Health Service Executive 2005 IESC 89 and 2006 ELR 137 were quoted. The Court pointed out that he had fallen well short of that.
The Defendants case was that if Mr Delaney was arguing the issue of fairness that his remedy if he wished to challenge the fairness of a dismissal was under the Unfair Dismissal Acts 1977 to 2015. The Court pointed out that the Court accepted the Plaintiffs argument that in a case where an employer is enquiring into an allegation of misconduct which reflects on an employee’s good name or reputation basic fairness of procedure and natural justice must be observed. The Court pointed out however, the Plaintiff had failed to establish that he had a strong case that is likely to succeed that he was dismissed by reason of misconduct.
The Court pointed out that if the Plaintiff had met the threshold test, he would have needed to go further and persuade the Court that this was an appropriate case in which to make the order sought the object of which, ordinarily, is to preserve the status quo pending the trial of the action. The Court pointed out that they were not persuaded that the Plaintiff had established that he would be exposed to a real risk of injustice if the order sought were not made and for this reason the application was refused.
In cases involving dismissal, there will often be an issue arising as to whether and to what forum an application should be made.
Where an individual is being dismissed for misconduct than the issue of fair procedures is vitally important, particularly as their good name can be in question. If fair procedures are not being applied and an individual is being dismissed for misconduct, then in those circumstances an injunction may well be the appropriate route to take. This case was not one of those cases, but it is an issue which is potentially very important for an employee and especially a senior employee or executive.
Where the argument relates to the fairness or otherwise of the process of dismissal then normally an Injunction in itself is not the correct route to take but rather to bring a claim under the Unfair Dismissal Acts 1977 to 2015. That is a claim which is not taken in the High Court by way of an Injunction but rather to the Workplace Relations Commission.
Where an Injunction is being sought the relief being sought is to maintain the employee in employment pending the outcome of the trial of the action. The action itself is one effectively seeking, going forward, that the employee would be maintained in their position and not dismissed.
A case to the Workplace Relations Commission has three possible outcomes where the employee is successful. The first is reinstatement back to the date that the employee dismissed with full salary to be paid back to that date. The second is reengagement whereby the employee would be reengaged, normally without any loss of service, but that the period between the dismissal and the reengagement would not be paid, though it could be a part payment if so decided by the Workplace Relations Commission. The third is simply compensation.
The reliefs between bringing a case to the High Court by way of an injunction and going to the Workplace Relations Commission are entirely different.
In a case in the High Court where an employee is successful in obtaining an injunction, the employee has to give an undertaking as to costs which in the case of an employee being retained in their employment will include their full salary if their claim ultimately is not upheld. In a High Court case, the person who loses the hearing of the trial of the action will be responsible for the costs, not only for themselves but for the other side also. In the Workplace Relations Commission or on appeal to the Labour Court, neither party is responsible for the costs of the other. Win or lose each party must pay their own costs.
The next issue is the issue of compensation. In an injunction, if successful, the employee will be maintained on their full salary and benefits and performing their job until the trial of the action. If successful they will be continued in their job with no loss of benefits. In an Unfair Dismissal case unless the employee is reinstated, the employee will be limited to economic loss. That loss is limited to a maximum of two years. However, under the Unfair Dismissal Acts 1977 to 2015 an employee is obliged to seek to reduce their loss. This means the employee must look for employment. If the employee, for example was employed at a rate of €52,000 per annum, which is an easy one for the purposes of giving examples, and the employee obtains a new job at €42,000 per annum then in those circumstances the maximum award, which the WRC can award, is €20,000. That payment is subject to Tax but is treated, for Tax purposes, as a termination payment where there are a number of exemptions. If the employee does not look for work and even if fully successful then the Legislation set out that the maximum compensation which the employee can obtain, in a case like this, would be four weeks’ wages or in monetary terms €4,000. Even where the employee has sought other work, and whether they were successful or not but the WRC accepting that they made a strong effort to obtain the work the maximum again is limited to two years. Take the example above, where the employee obtains other work. And they are aged, for example, 50 years of age, they will obtain compensation for only two years. If an injunction had of been obtained, they would have kept their job until retirement.
The tests in an injunction case are that the employee must be able to show, not only do they have a good case but that they have a strong probability of winning at the trial of the action. This is a substantial test to be proved by the employee. In an Unfair Dismissal case the employee need prove nothing. It is for the employer to show that the dismissal was fair. In an Unfair Dismissal case, it may well be that the employer can show that what the employee did, or, in some case did not do, was such that would warrant dismissal but the employer may still loose the case where they have failed to apply fair procedures.
When advising clients in relation to the issue of whether to take an Injunction or to bring an Unfair Dismissal case the reality is that for many employee’s, except senior executives and senior managers, or, those at much lower salaries, the costs of bringing a case and in reality the potential for losing at the interlocutory stage is such that many employee’s will not be prepared to take on an injunction case and will go for an Unfair Dismissal case. For those who go for an injunction the first step is an Ex-Parte application which is a low threshold. The matter is then returned for an Interlocutory hearing and that is where the difficulties arise. For more senior individuals it is often the position that at that stage their employer because of reputational risk to that employer, particularly if it relates to a sensitive or regulatory issue, or, in the case where the employer company may see themselves at risk, it is more usual then not that these cases end up in some form of negotiation to reach a mutual settlement. When acting for an employee that is never guaranteed. When acting for an employer unless the employer intends to pursue any costs which they would have awarded, will be looking at the cost itself of defending such an action. This is not only the cost of their legal team but the potential disruption to their business and the issue as to how they will deal with matters if the employee wins at the interlocutory stage, which often drives them to seek a compromise. At the same time, there are other employers, for whatever reason, will take the view that cases of this type have to be fought whether or not they win or lose.
When it comes to the dismissal or proposed dismissal of an individual it is necessary to have a discussion with a Solicitor, who has specialist knowledge in this area of law, to decide on how best to address matters. If the injunction route is to be used then speed is of the essence. Delaying in taking an Injunction application can itself be fatal to the process. For an Unfair Dismissal case the employee has time to consider matters as they have six months from the date of the dismissal to lodge a claim.
We have reviewed the recent decision set out above because of the fact that it is so unusual that these cases do come on for hearing at the Interlocutory stage. Where an Interlocutory order is granted even fewer of these cases come on for hearing because the employee will have, at the Interlocutory stage, shown that they have a very strong case and likely to succeed.
Where an employee is subject to a threat of losing their job, it is always better that they talk to an Employment Law Solicitor before the dismissal rather than afterwards. The fact that an employee believes that the allegation against them will not stand up, or, that they are innocent of the charge against them, or, that the employer would never dismiss them because of their long service, is not a reason not to see a Solicitor. Where an employee is under threat of a disciplinary action which could lead to dismissal, those steps are not taken lightly by an employer. An employee in those circumstances is better of getting appropriate legal advice. They then know the options available to them. If it is a suitable case for an injunction, they are then in a position to move very quickly, sometimes even before the disciplinary hearing will take place, to protect their position.
*Before acting or refraining from acting on anything in this guide, legal advice should be sought from a solicitor.
*In contentious cases a solicitor may not charge fees or expenses as a proportion or percentage of any award or settlement.