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“Sham” redundancy of CEO leads to award of €30,000

The issue of a “sham” redundancy led to the award of €30,000 in the recent case of Marian Lovett v The Temple Bar Gallery and Studios Limited UD 284/2011.In the determination sent last week, it was reported that due to a reduction in public funding which the Respondent relied upon, the Respondent was forced to undergo a re-organisation. The re-organisation resulted in a reduction in a number of administrative positions with newly defined roles. As part of the re-organisation the Claimant, who was the Chief Executive Officer (“CEO”), put herself forward for interview for a new position before an independent review panel which had been specially convened by the Respondent, but was ultimately not successful.It was held unanimously by the Tribunal that the Claimant’s redundancy was a “sham” and the Claimant was therefore unfairly dismissed. The Tribunal found that the Claimant as CEO was not fully consulted or allowed to be involved in any meaningful way in the restructuring plans.The Tribunal also noted that the obligation and duties contained in the new position of Studio Development Officer were practically the same as the CEO and that the role of CEO still existed albeit under a new name or title.The Tribunal also cited with approval sentiments from the case of St Ledger v Frontline Distributors Ireland Limited 1995 ELR namely that the statutory definition of redundancy had two important characteristics, “impersonality” and “change”. The Tribunal felt such characteristics were lacking in this case and awarded the Claimant €30,000 under the Unfair Dismissal Acts 1977 (as amended).

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