The Complainant was employed by the Respondent Company from January 2008, until his dismissal in March 2020.
In September of 2017, the Complainant was involved in a serious road traffic accident, arising out of which he pleaded guilty to dangerous driving causing harm, for which he received a four-year prison term. The Complainant kept his employer informed on the matter. In October 2019, prior to his sentencing hearing, he advised the Respondent of the likely duration of his incarceration. In response, he was given three days to get his affairs in order. In March of 2020, the Complainant received a letter terminating his employment, effective of the 25th March 2020, on the grounds that his contract was frustrated by reason of his prison sentence.
Upon receipt of his notice of termination, the Complainant lodged a complaint to the Workplace Relations Commission, claiming he was unfairly dismissed pursuant to the Unfair Dismissals Act, 1977 (as amended).
The Complainant’s representative submitted that the Respondent was in a position to carry on it’s operations following the Complainant’s imprisonment, and the imprisonment was merely an inconvenience to the Respondent, rather than a basis for the contract to be frustrated. It was also argued that frustration may only arise following a consultation with the employee, where the impacts of the employees actions, on the Respondent are considered. In the present case, the Respondent made no effort to meet with the Complainant, nor was any evidence given regarding the effects of the Complainant’s absence on the Respondent.
As part of their defence, the Respondent submitted that management had considered, at length, the effect of the Complainant’s prison sentence on his employment. The Respondent claimed that management had determined that the custodial sentence resulted in the frustration of his contract, therefore, a claim for unfair dismissal does not arise. The Respondent also cited the fact they were required to hire an additional person to back fill the Complainant’s role by virtue of his absence. Whilst, the Respondent accepted that a custodial sentence does not automatically frustrate a contract of employment; given the duration and the nature of the employment, they were of the view it ultimately served to frustrate the contract.
In reaching his decision, the adjudicator Brian Dolan, cited the definition of frustration of contract as described in Employment Law in Ireland, Cox, Corbett & Ryan1. “A contract of employment will be terminated by frustration where performance of the contract becomes impossible to perform due to an unforeseen event outside the control of either party. In such situations the contract is terminated by operation of law”. The Adjudicator also had regard to the decision in Zuphen v. Kelly Technical Services (Ireland) Ltd2 where it was held that the event of frustration “must be so unexpected and beyond the contemplation of the parties, even as a possibility, that neither party can be said to have accepted the risk of the event taking place when contracting”. To that end, the adjudicator highlighted that the Respondent was aware of the Complainants incarceration for four months prior to the alleged frustration event occurring, which was not in keeping with an unexpected event that was beyond contemplation of the parties.
The adjudicator considered the fact that notice of termination was provided to the Complainant prior to termination. He was of the view, if frustration of contract had arisen, no notice would have been provided. Lastly, he also had regard to the fact that Respondent’s activities continued for a period of 4 months without any evidence showing that the Complainant’s imprisonment caused disruption. As such, the adjudicator concluded that “the Complainant’s absence, while undoubtedly a hardship and an inconvenience for the Respondent, did not result in a requirement for the employment to be terminated.” As a result the complaint of unfair dismissal was upheld, and the Complainant was awarded €4,000.
In determining the appropriate amount to be awarded, the adjudicator had regard to the decision An Electrician v A Transport ADJ-0007578. Here the WRC held that where imprisonment results in termination, any compensation should be reduced significantly (85% in that case).
Key Employer Takeaways
The defence of frustration cannot be cited as a reason for dismissal where the circumstances amount to nothing more than an inconvenience for the employer, and they are not inhibited from carrying out their activities Frustration must be as a result of an unforeseen circumstance, which was unexpected by both parties. Moreover, this case demonstrates that an imprisonment of an employee does not in turn permit an employer to summarily dismiss them . Regard must still be had to the employee’s right to natural justice and fair procedures. Lastly, where an imprisonment results in termination, and where the said dismissal is deemed to be unfair, any compensation will be reduced significantly due to the employee’s contribution to his own dismissal.