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High court rules for GIDC against Roden

Female high court judge Agnes Actie - has handed down a ruling in favour of the Grenada Industrial Development Corporation

Female high court judge Agnes Actie has handed down a ruling in favour of the state-owned Grenada Industrial Development Corporation (GIDC) against its former Boss Sonia Roden.

The case dates back to 2014 when Roden’s employment with the corporation was ended under the rule of the former Keith Mitchell-led New National Party (NNP) government.

The judge did not agree to the legal arguments put forward by the attorney-at-law who was retained by the claimant.

In her ruling, Actie said, “The court applying the law to the facts finds that the Claimant has failed to prove her case and the reliefs claimed.”

She said in her ruling: “Accordingly, the claim is dismissed with costs to the defendant. In summary, it is ordered as follows:

(1) The claimant’s claim is dismissed.

(2) The parties prior to the trial agreed to prescribed costs in the sum of $25,000.00 pursuant to CPR 65.5(2)(b) .

Accordingly, the claimant shall pay the defendant the sum of $25,000.00 within thirty (30) days of the date of this order.

Following is the full text of Actie’s ruling in the matter:

JUDGMENT
[1] ACTIE, J.: The central question in the claim filed on 29th April 2020 is whether there was a breach of an employment contract by the defendant in the payment of severance and vacation leave pay to the claimant.

The Claimant’s case
[2] The claimant avers that she had been employed with the defendant continuously from 1st March 1985 until her services were terminated effective 8th September 2014. The claimant contends that her employment with the defendant was governed by a management staff agreement dated 1st April 1996, (hereafter referred to as “the agreement”) and that it was an implied term of the agreement that the weekly wage for the computation of her severance pay package would be calculated by dividing her annual wage by a denominator of fifty (50).

[3] The claimant states also that it was a statutorily implied term of the agreement pursuant to Section 3(1) of the Employment Act that, if the defendant terminated her employment and paid her in lieu of notice, the defendant would also confer all other benefits that would have been due up to the expiry of any notice period.

[4] The claimant further states that it was mutually agreed that she would and did proceed on 41 working days’ annual vacation leave from 1st April 2014 to 30th May 2014. The claimant avers that following the expiry of the 41 days’ vacation leave and without any previous consultation, the defendant by letters dated 20th May 2014 and 30th June 2014 directed that she was to continue her annual vacation leave for a further 21 working days and a further 44 working days’ leave, respectively. Thereafter, by letter dated 29th August 2014, the defendant terminated the claimant’s employment with effect from 8th September 2014.

[5] The claimant contends that the defendant’s termination of her contract was made in breach of the employment agreement for the following reasons namely:

(1) Payment of severance was for the period 1st October 2001 to 8th September 2014 rather than from the period 1st March 1985;

(2) Failure to pay termination allowance for the period of payment in lieu of notice as required by statutorily implied term of the said agreement contained in Section 79 of the Employment Act;

(3) Failure to pay the claimant for 55 days accumulated leave which the claimant had upon completion of her annual vacation leave on 31st May 2014;

(4) Failure to pay the claimant for 30 days leave which would have accumulated during the period of payment in lieu of notice;

(5) Breach of the implied term of the contract which required the claimant’s weekly wage to be calculated by dividing her annual wage by 50;

(6) Alternatively, breach of the term which required the payment of 7 weeks for each year worked.

[6] The claimant claims special damages in the sum of $288,804.22, general damages for breach of the agreement, together with interest and costs.

The Defendant’s case
[7] The defendant denies the alleged breaches or that the claimant suffered loss and damage. The defendant contends that the claimant was paid all termination benefits under the contract of employment as was confirmed by a Senior Labour Officer of the Labour Department.

[8] The defendant further avers that the claimant, subsequent to her termination, referred the substance of the claim herein as a complaint for unfair dismissal under the Employment Act to the Labour Department and to the Arbitration Tribunal. The defendant contends that the claimant has engaged the correct legal forum for the determination of her complaint, and that this court has no jurisdiction or, alternatively, should decline to exercise any jurisdiction to deal with this claim.

[9] With respect to the issue of vacation leave, the defendant avers that the claimant was told in a meeting held on or about 31st March 2014 that the board of the defendant had taken the decision to have employees with excessive accumulated leave to proceed on vacation. Further, the defendant states that the claimant failed to raise any concerns with the chairman of the board in relation to her leave although invited to do so by letter dated 9th July 2014.

Legal Analysis
Whether the court has jurisdiction to determine the claim for failure to pay termination allowance

[10] The claimant in her pleadings claimed for termination allowance amounting to $249,981.43. However, counsel for the claimant concedes in closing submissions filed on 4th December 2023, that insofar as the right to termination allowance is concerned, the procedure of complaint to the Minister and if necessary, a determination by an Arbitration Tribunal is applicable.

[11] Counsel for the claimant argues that the Employment Act however has not excluded common law rights and that the court continues to have jurisdiction to hear and determine common law causes of action. Counsel relies on Eastwood and another v Magnox Electric PLC Mc Cabe v Cornwall County Council and another wherein it was held that:

“ ….. where an employee had, prior to his unfair dismissal, whether actual or constructive, acquired a common law cause of action against his employer in respect of the employer’s failure to act fairly towards him such that it could be said to exist independently of his subsequent dismissal, and financial loss had flowed directly from that failure, he could, subject to the rule against double recovery, bring an action at law in respect of that loss and such action was not barred by the availability of a claim in the employment tribunal under the unfair dismissal legislation.” [emphasis added]

[12] On the other hand, counsel for the defendant argues that the agreement did not create a remedy called “termination allowance”, and states that Section 89 of the Employment Act sets out the complaints procedure with respect to termination allowance.

[13] The particulars of breach of the agreement as pleaded by the claimant include “failure to pay termination allowance for the period of payment in lieu of notice…” The claimant has not directed the court to any provision in the agreement which guarantees the payment of termination allowance.

[14] It must follow therefore, that the claimant is relying on Section 84 of the Employment Act for the enforcement of this right to termination allowance. Section 84 prescribes the remedy for complaints which arise on the application of the Section with the relevant subsections being subsections (1) and (5) which provide as follows:

Related:  High court rules for GIDC against Roden – Part II

“(1) On termination at the initiative of the employer, an employee who has completed one year or more of continuous employment with his or her employer and who is not entitled to gratuity shall be entitled to be paid by the employer a termination allowance of not less than one week’s wages for each completed year of service.

(5) A complaint that a termination allowance has not been paid may be presented to the Labour Commissioner and if necessary to an Arbitration Tribunal which, if it finds the complaint to be well founded, shall make a declaration to that effect and order payment of the amount due.”

[15] Further, Section 89 of the Employment Act states that:

“(1) Any person alleging a violation of a provision of this Act may report the matter to the Labour Commissioner, who may institute or cause to be instituted a prosecution in order to enforce the provisions of this Act.

(2) Notwithstanding the provisions of subsection (1), where not otherwise specified, any person alleging a violation of this Act may present the complaint to the court for appropriate relief.”

[16] The claimant has admitted to initiating the process of complaint as prescribed by the Act, before the Labour Commissioner.

Accordingly, this court is therefore of the view, and finds, that based on the cause of action with respect to termination allowance under the Employment Act, as well as the evidence that the claimant has engaged the statutory processes in pursuit of her complaints, the court’s jurisdiction to determine a claim for termination allowance has been ousted.

Whether the defendant breached the 1996 Agreement

Severance Pay
[17] The claimant states that upon the termination of her employment, she was paid one year’s salary in lieu of notice, severance pay for the period of 13.92 years, from 1st October 2001 to 8th September 2014, and other allowances as per the agreement amounting to a gross sum of $333,061.00.

[18] The claimant’s factual complaint relates to the period of severance pay which she alleges ought to have been from 1st March 1985 to 8th September 2014.

[19] The defendant does not dispute that the claimant was entitled to severance pay. Instead, the defendant contends that the claimant could not have been in continuous employment from the year 1985 since the claimant continued to enjoy the status as a public servant up to 1st October 2001.

[20] The agreement with respect to severance pay states as follows:

“Redundancy and Severance Pay
Years of service… over 4 years of continuous service: 7 weeks salary for each year, or proportional part thereof, of service.”

[21] To ascertain the period during which the claimant was effectively employed by the defendant, the timeline and history of the claimant’s employment becomes relevant.

[22] By letter dated 19th January 1984, the claimant was appointed as Administrative Cadet of the Ministry of Industrial Development and Fisheries with effect from 1st September 1983. This letter states that the claimant would be responsible to the Permanent Secretary of the Ministry of Industrial Development for the proper performance of duties, and that the claimant would be on two years’ probation. Thereafter, and during the period of probation, the claimant was seconded from the Ministry of Industrial Development to the defendant by the Public Service Commission, by letter dated 29th March 1985 from the Chief Personnel Officer. The letter states the following:

“I am directed to inform you that the Public Service Commission has approved your secondment to the Industrial Development Corporation with effect from 1st March 1985 and until further notice.”

[23] By letter dated 11th March 1999, the claimant was confirmed retroactively in her appointment as Administrative Cadet in the Public Service posted to the Ministry of Finance with effect from 1st September 1983. This letter states that the claimant is subject to the provisions of the Public Service Commission Regulations, the Civil Service Staff Orders, Financial and Store Rules and other Regulations, responsible to the Permanent Secretary of the Ministry of Finance for the proper performance of duties. A further letter dated 17th November 2005, retired the claimant from service of the Public Service Commission with effect from 1st March 1985.

[25] The court has not been directed to legislation which governs the status of public officers seconded to the defendant. Nor has the court been presented with an explanation as to issuing of the letter of 11th March 1999 confirming the claimant in her appointment as Administrative Cadet of the Ministry of Industrial Development and Fisheries, when the claimant alleges she was in the employment of the defendant. Evidence was solely given by the claimant.

[26] Nevertheless, the court notes that Section 16(7) of the Grenada Investment Development Corporation Act No. 30 of 2016 states that:

“Public officers may be transferred or seconded to the Corporation or may otherwise give assistance to the Corporation.”

[27] The court finds that the claimant herself did not consider herself an employee of the defendant from 1st March 1985 for the following reasons:

(1) On 21st March 1985, the claimant applied to the Permanent Secretary of the Ministry of Finance for maternity leave, copying the Manager of the Industrial Development Corporation;

(2) An increment certificate for 1st March 1989 was granted to the claimant by the Ministry;

(3) An increment certificate for 1st March 1990 was granted to the claimant by the Ministry;

(4) In letter dated 2nd March 2000, from the claimant to the Chief Personnel Officer of the Public Service Commission, the claimant stated that she was currently on secondment from the service to the defendant; and

(5) By letter dated 5th April 2000, from the claimant to the Comptroller of Inland Revenue, the claimant considered herself a civil servant.

(6) Further, the claimant obtained a gratuity as a public servant.

[28] The court finds that the terms of the appointment letter of the claimant dated 28th February 2001 in effect created a relationship of employment between the claimant and the defendant. In said letter, the defendant states:

“The Board of Directors of the Grenada Industrial Development Corporation, with the approval of the Minister of Finance, is pleased to appoint you to act in the position of General Manager of the GIDC effective January 2, 2001.”

[29] This appointment was in accordance with the Grenada Industrial Development Corporation Act CAP 130B, Section 9(1) of which states:

“The Corporation, with the prior written approval of the Minister, shall appoint a suitable person as the General Manager and fix his or her terms and conditions of service.”

[30] Given that the defendant issued an appointment letter to the claimant in accordance with the then governing Act, the court is constrained to find that the claimant was an employee of the defendant as of 2nd January 2001.

[31] As stated prior, the agreement makes provision for the payment of severance in the formula of seven weeks salary for each year or proportional part thereof of service.

[32] In evidence given on behalf of the defendant, the claimant’s gross monthly salary was $9,556.70, however counsel for the claimant argues that the final annual salary of the claimant was $114,184.56. The court is guided by the claimant’s evidence.

TO BE CONTINUED

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