Fiscal Services ordered to pay redundancy claim

Barbara Gayle, Staff Reporter

FISCAL Services (EDP) Ltd. has been ordered by the Court of Appeal to make redundant payments to Manley Haye, former head of its audit division whose contract of employment was terminated in 1994.

The Court in making its ruling last week had to interpret the Employment (Termination and Redundancy Payments) Act and the Hire Purchase Act.

Mr. Haye's contract was to run from May 1, 1992 to April 30, 1995 but on June 14, 1994, the company advised him that his contract was terminated with immediate effect and he was entitled to three months salary. He was first employed to the company as development manager from May 1990 to May 1992.

Following his dismissal he took the matter to the Supreme Court contending that he was entitled to redundancy payment. The company claimed that he was not entitled to any such payment.

Justice Ellis, Senior Puisne Judge, threw out Mr. Haye's claim and ruled that he did not prove that his dismissal was due to redundancy. Mr. Haye appealed and the Court of Appeal found that under section 5(1) of the Employment (Termination and Redundancy Payments) Act, Mr. Haye was entitled to redundancy payment.

Relevant section

The court said that the relevant section had two limbs which Mr. Haye must satisfy. The first being that Mr. Haye must be continuously employed for 104 weeks and the other being that he must be dismissed for reasons of redundancy.

The court found that since Mr. Hayes' employment commenced on May 1, 1990 and was terminated on June 14, 1994. he had satisfied the court that he was continuously employed for 104 weeks.

The Court of Appeal comprising Justice Henderson Downer, Justice Paul Harrison and Justice Ransford Langrin found that there was evidence that from the time Mr. Haye was dismissed, to May 1, 1995, the work of the Audit Department had ceased and no one was employed therein. "The appellant made out his case on a balance of probabilities, because he demonstrated that no one was employed in the department for approximately one year. Before the appellant's dismissal the number of employees was reduced from nine to one. He is therefore entitled to $135,240 for redundancy as claimed."

Mr. Haye who was represented by attorneys Christopher Dunkley and Marino Sakhno contended that there was a lease-back agreement between Mr. Haye and the company whereby as of December 1, 1991 Mr. Haye was to pay $4,300 monthly for a motor car. He said he was entitled to a refund of the sums of $133,300 which he paid on account of the motor car.

The agreement read that "and to effect such payments the hirer hereby authorises the owner to deduct the said sum of Four Thousand three Hundred Dollars ($4,300) at the end of every month of this agreement and apply the same in satisfaction of the hirer's obligation herein."

Clause 11 of the agreement stated that "the owner hereby grants to the hirer the option to purchase the said motor vehicle after five years of the execution of this agreement, acceptance to be communicated in writing to the managing director of Fiscal Services (EDP) Limited." The company hired a bailiff to repossess the motorcar on July 2, 1994.

It was the court's finding that the lease-back agreement combined with the contract of employment were governed by the provisions of the Hire Purchase Act.

The Supreme Court had ruled that Mr. Haye was not entitled to a refund of $133,300 which he paid under the lease-back arrangement.

Supreme Court judge erred

The Court of Appeal ruled that the Supreme Court judge erred in his finding since the company recovered the motor vehicle otherwise than by (court) action in contravention of Part 3 of Section 24(1) of the Hire Purchase Act.

The court said further that the Act entitled Mr. Haye to secure all sums paid pursuant to the lease-back agreement before his dismissal therefore he was entitled to the $133,300 as claimed.

A pager was stolen from the car when it broke down on May 31, 1993. Haye said he had informed the company that the pager was stolen but the company deducted $10,000 for the rental of the stolen pager. The court, in reviewing the matter said it found on a balance of probabilities that the loss of the pager was reported to the managing director not later than three days after it was stolen. The company had ample time to inform their insurers of the loss, the court held.

In ruling in Mr. Haye's favour, the court set aside the Supreme Court ruling and ordered Fiscal Services to pay Mr. Haye $135,240 as compensation for redundancy and $133,300 for the recovery of payments under the lease-back agreement. The company was also ordered to refund him the sum of $10,000 wrongfully deducted from his terminal package.

Interest at the rate of 15 per cent per annum from November 8, 1994 to February 1, 2001 was awarded on the total sum due to Mr. Haye. Costs were also awarded in Mr. Haye's favour.

Attorneys Herbert Hamilton and Dorothy Lightbourne represented Fiscal Services.

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