Non-ratified treaty¹

Dismissal of 17 employees due to redundancy of positions/ Consideration of whether employer required to consult with employees and union prior to the dismissals/ Establishment of a jurisprudential principle based on international law

Pathfinder Enterprises T/A NIIT (“NIIT”) dismissed 17 employees on the basis of redundancy of their positions. Several of those employees issued legal proceedings against NIIT on the basis that the dismissals were illegal and unfair.

The Industrial Court determined, based on the evidence before it, that the dismissals were substantively fair. The Court stated, however, that is also needed to consider if the redundancy process that led to the dismissals was procedurally fair. To answer this question, the Court considered section 25(2) of the State’s Employment Act which set out the processes that NIIT needed to ensure took place in a redundancy exercise and stated NIIT needed to demonstrate “not substantial but full compliance” with that section.

Section 25(2) required, in summary, that NIIT give written notice of its intention to dismiss employees on the basis of redundancy to the Commissioner of Labour and to every employee to be, or likely to be, directly affected by the redundancy. The Employment Act did not address, however, whether NIIT was required to consult with employees as part of the redundancy process. 

The Court then referred to, and applied, Articles 13(1)(b) and 14(1) of ILO Convention No. 158, stating the source of its power to do so came from its equitable jurisdiction. The Court stated that Article 13(1) (b) of ILO Convention No. 158 imposed a duty on the employer, as part of a redundancy process, to give the workers representatives concerned, as early as possible, an opportunity for consultation on measures to be taken to avert or to minimise the terminations and measures to mitigate the adverse effects of the termination.

The Court determined, on the evidence submitted, that NIIT had notified the affected employees and the Commissioner of Labour. The Court also found, however, that the staff meetings that NIIT claimed had taken place could not, and did not, pass the test to qualify as consultative meetings.

The Court then stated that, in order to discharge its duty to consult, NIIT needed to create a meaningful forum to allow those employees adequate consultation and that there was no evidence that this had occurred.

The reference to ILO Convention No. 158 enabled the Court to establish the jurisprudential principle that a procedurally fair redundancy process was one that included consultation.  Having analysed the redundancy process conducted by NIIT, the Court concluded that the employees were “not consulted within the meaning of [Article 13(1) (b) of Convention No. 158] prior to their termination by reason of redundancy” and, on that basis, determined the dismissals were “substantively fair but procedurally unfair” and so awarded the employees compensation.

¹ ILO Termination of Employment Convention, 1982 (No. 158).