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Record Compensation Award is a Stark Warning for Employers when Managing Employee Relations at Work

June 01, 2022

How employee relations issues are managed by an organisation is crucially important. If conflicts and concerns are managed quickly and respectfully, then formal action can often be avoided. However, when conflicts are not addressed effectively and allowed to go unattended there can be significant disruption to the organisation. When dealing with misconduct, including gross misconduct, it is critical that employers act in a reasonable manner, follow due process and adhere to the principles of natural justice.  Any disciplinary sanction must be proportionate to the particular circumstances.
With employee relations issues, there is always a potential risk of escalation to the Workplace Relations Commission (WRC), which brings additional financial costs and reputational damage given that the majority of hearings can now be heard in public.
It has been widely reported that the WRC recently made a record award of €329,199 to a sales executive for unfair dismissal. The sales executive was dismissed on the grounds of serious misconduct after two separate allegations of bullying in May and June 2019. In this case, it was found that whilst the employee did engage in some inappropriate behaviours in his interactions with his two colleagues who made a complaint about him, that these fell a long way short of warranting his dismissal in the circumstances. It was noted that no formal warning had been issued to the complainant, and the grounds for dismissal were found to be “unclear.” In addition, the behaviour had taken place during Ramadan, which the claimant was observing. The WRC Adjudicator suggested that a reasonable employer would have tried to understand if the employee’s observance of Ramadan was causing difficulty for him.

This record award is a stark reminder of the importance of effective employee relations management and of having fair and consistent disciplinary and grievance procedures in place which employers should strictly adhere to when handling such matters.