Tech firm ordered to pay sales director €112k over handling of redundancy

American tech firm PluralSight has been ordered to pay an Irish sales director €112,000 over the handling of her redundancy during a round of staff cuts in 2022.

The Workplace Relations Commission (WRC) made the award in a decision published on Tuesday on foot of a complaint under the Unfair Dismissals Act 1977 against Pluralsight Ireland Ltd by Gráinne Sherlock.

Ms Sherlock had climbed the ranks at the US-headquartered educational technology firm since joining a commercial team in Dublin in June 2019 – finding herself promoted to a management role in its global small- and medium-sized business (SMB) sales team in April 2021, becoming SMB director a year later.

The post had a base salary of €94,800, along with performance bonuses and commission, her lawyers told the tribunal.

However, the WRC was told that the company’s management had taken the “difficult decision” to restructure and reduce its staff by a fifth in 2022 – affecting 254 workers in the US and nine in Ireland.

The tribunal heard that there was an announcement in December 2022 that Ms Sherlock’s job and all the Europe-based SMB sales teams would “fall under” the Dublin commercial team.

Ciarán Ahern of McInnes Dunne Murphy, appearing for the complainant, had argued the decision to make his client redundant was based on a “contrived” process that was “manipulated to ensure [she] was selected for redundancy”. This was denied by the company and its lawyers.

Ms Sherlock’s case was that there was “disquiet” between the Dublin commercial team and the SMB team about the “attribution of deals”. She told the tribunal that she “often felt ignored and omitted from the Dublin office.

The tribunal heard that there was an announcement in December 2022 that Ms Sherlock’s job and all the Europe-based SMB sales teams would “fall under” the Dublin commercial team – and that only five of the eight remaining leadership roles would be kept on in the combined team in the year ahead.

The company’s senior vice-president of sales for Europe, the Middle East and Asia (EMEA), Mark Wynne, gave evidence and described as “logistically impossible” any accusation that the SMB team were “stealing sales leads” from its commercial department.

Mr Wynne’s position was that any issue with regard to SMB thresholds was not something that would have been “aimed” at Ms Sherlock, and said that the first he knew of any “assertion of animus” on his part against the complainant was when he saw her lawyers’ legal submissions.

The witness denied the selection process had been “tailored to suit the candidates he wished to retain”.

Cris Santos, the company’s vice-president of revenue, strategy and operations, gave evidence the redundancy process was “no different from previous restructures”, although it was “bigger” and “on a global scale”.

Questioned on the employee’s claims that the process was biased, Ms Santos told the WRC that she was “completely objective”.

The company’s barrister, Niamh McGowan BL appearing instructed by A&L Goodbody LLP, submitted that PluralSight had been hit by “significant economic challenges” in 2022 which demanded job cuts – and had carried out a “legitimate” redundancy process.

In her findings, adjudicator Kara Turner wrote: “Whilst the complainant may have perceived a hostile attitude and exclusionary behaviour by Mr Wynne, I find that such an attitude and behaviour was not supported by the evidence.”

However, she found there was a lack of clarity about what individuals were involved in the decision to bring the company’s SMB sales team into its commercial function. Ms Turner added that she was “not satisfied” with the objectivity of the selection criteria, specifically the 80 per cent weighting given to interviews with those at risk compared to 20% on past performance.

“The respondent failed to demonstrate where the complainant ranked in the selection process and furthermore that she was evaluated fairly vis-à-vis other candidates,” Ms Turner wrote.

This, as well as the fact that the company had not given Ms Sherlock her ranking after the interviews went against its argument that its process was “open and transparent”, Ms Turner added.

The adjudicator added that PluralSight was “unreasonable” not to consider an extension of the consultation period “or to at least have engaged with [her]” on her request for an extension.

In setting compensation, Ms Turner noted that the parties were in dispute on the calculation of Ms Sherlock’s losses. The employee’s total pay in 2022 was €183,573.07, the WRC noted. Her base salary was €94,800, with a further €62,200 provided for as a commission on the basis of reaching her full sales targets.

The adjudicator was also asked to consider cash equity payments in calculating Ms Sherlock’s losses, as well as a €20,000 performance bonus awarded in 2022 that was to fall payable in March 2023 and 2024.

Ms Sherlock’s lawyers further submitted that their client had lost out on stock options which would have been made available to her in a series of four annual tranches staring in April last year.

Ms Turner found Ms Sherlock’s efforts to secure new work reasonable and wrote that she would hold the company liable for the employee’s financial loss over a 13-month period from February 2024 to March 2024 on the basis of the worker’s base salary plus commission.

The adjudicator deducted 15 weeks’ pay to account for a period Ms Sherlock had been in a probationary role in 2023 and applied a 50 per cent reduction over the final five months of the calculable period – taking the view that Ms Sherlock’s effort had not shown “as dedicated and consistent” an effort as immediately after her redundancy.

However, she did conclude that Ms Sherlock could claim the €20,000 bonus and a cash equity payment from 2023 worth €6,775 — but not the stock options. The total award in the case was €112,000.