Restaurant Employee Wins €30,000 Award
A restaurant chain has been ordered to pay €30,000 for unfairly sacking the son of its founder amid an alleged struggle for control of the business after it left examinership.
The Workplace Relations Commission heard last year the family believed a new investor who took over the firm in February 2020 had "reneged" on a deal when they were presented with a "performance" plan that would see them assigned non-voting share rights.
The adjudicator who decided on the case also criticised the HR firm that handled a subsequent appeal by the manager against the redundancy, saying he "could not overlook" the complainant's concerns about the impartiality of the appeal.
The WRC upheld Philip Hanley’s complaint under the Unfair Dismissals Act 1977 against PBR Restaurants Ltd, trading as Fish Shack Café. It said the company had also been in breach of the Payment of Wages Act but refused compensation on the grounds of the impact of the Covid-19 pandemic on the restaurant business at the time.
The restaurant group had been run by the Hanley family until August 2019 when it was placed into examinership, the tribunal was told. Two of its restaurants were sold off to separate investors, with the firm retaining four café units trading under the Fish Shack brand following the takeover.
Solicitor Dr Gerald Kean, appearing for Mr Hanley, said the investment came through an "offshore company" registered in the British Virgin Islands.
The company’s original owner, the complainant’s father Padraic Hanley, became an employee, while Mr Hanley and his two brothers were retained in employment, Dr Kean said.
Dr Kean said the complainant’s father had agreed a deal with the new investor via a new non-executive director on the family’s position in the company after the examinership.
"The investor subsequently reneged on that deal," he said.
Dr Kean said new terms were put to the Hanleys in February 2020 which would have seen them assigned non-voting share rights – and came with a deadline which he said amounted to a "clear threat" to his client’s continuing employment.
He and other family members refused to sign and were placed on unpaid layoff four weeks later, he said. The layoff continued until the termination of his employment that August, the tribunal heard.
"No other staff members out of a total of 50 were selected for this redundancy process or treated in this manner," Dr Kean said.
The business said it faced a genuine redundancy situation after closing two restaurants and the impact of Covid-19 on its trade. It argued the dismissal decision was procedurally fair – and that any alleged defects "did not serve to imperil his right to a fair consultation process" on the redundancy.