A tech firm that admitted unfairly dismissing its Irish founder has been ordered to pay him a record €464,000 awards package by the Workplace Relations Commission (WRC).
Hyph Ireland Ltd, formerly Xhail Ireland Ltd, was hit with orders to pay €440,000 for loss of earnings and €24,000 for notice pay on foot of statutory complaints by musician, composer and entrepreneur Mick Kiely, who was ousted as its chief executive in 2021.
Mr Kiely, who had a €340,000-a-year salary at the firm he founded in 2013, was able to claim almost all his lost earnings for a 17-month period after the WRC decided the businessman could not be reasonably expected to mitigate his full losses while subject to a non-compete clause.
The tribunal added in its findings that Mr Kiely had shown “considerable effort and tenacity” by re-establishing himself in business in just 17 months.
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The €440,000 Mr Kiely has been awarded under the Unfair Dismissals Act 1977 is the highest-ever dismissal award made by the Workplace Relations Commission, surpassing by about a third the previous record award of €329,000, which was made to a fired sales executive in May 2022.
Mr Kiely, who was represented by barrister Jason Murray, instructed by Aine Curran of O’Mara Geraghty McCourt, had claimed his dismissal was “contrived” by the Xhail Group based on an allegation his visa status “did not comply with US law”.
On November 19th, 2021, the company’s chief of staff told him by email he was “no longer an employee” and that he was “prohibited from accessing or entering Xhail premises by any means”.
“Please understand it will be considered trespassing if you do so, and Xhail will not treat such an unlawful act mildly,” the chief of staff wrote.
Mr Kiely said he had been “locked out” of the company’s premises by the following day with all access to company systems and his emails “blocked” since.
The main matter in dispute was how much money was due to Mr Kiely – the company having admitted in advance that his contract of employment was governed by Irish law, and that the dismissal was unfair.
Mr Kiely’s case was that he was left with significantly reduced earnings following his dismissal. The tribunal heard the complainant made about €10,000 in 2022 by operating a holiday business in Co Clare, and a further €2,000 as an artist.
Mr Murray submitted this was because his client was subject to a “non-compete clause” restricting him from going into business in the respondent company’s area.
Mr Kiely’s position was that he wanted to “continue his innovative work” and asked Xhail to let him set up a new company, but was refused. The company denied this.
Mr Murray submitted that his client was down €478,000 as a result of the dismissal.
The employer, which was represented by barrister Mary-Paula Guinness, instructed by solicitors Whitney Moore LLP, took the position that Mr Kiely had failed to make efforts to mitigate his loss because of “inertia” on his part.
The tribunal noted submissions from Ms Guinness that there were areas of the music and technology fields where Mr Kiely could have worked that were not restricted by the non-compete clause – and that the complainant could have looked “outside his area of interest”.
The company’s view was that the hospitality business established by Mr Kiely was a “substantial” one and “could have been run successfully; however, the complainant decided to stay in the US where he could not work and in turn this is the reason why his earnings during this period [are] relatively modest,” it noted.
The company also claimed Mr Kiely owed it $231,000 (€213,000) on loans to rent a property in Los Angeles and buy furniture – a contested issue which is the subject of a lawsuit in the US, the WRC noted.
Adjudicator Brian Dalton calculated Mr Kiely’s losses over the 17 months between dismissal and a WRC hearing last September at €460,000, and said he would reduce the figure by €20,000 on the basis of the average industrial wage for the five-month period after the non-compete clause expired.
“It is not reasonable that he could be expected to mitigate his full loss considering the restrictive covenant,” Mr Dalton wrote – adding that as Mr Kiely had started up a new business in a “very reasonable period” he had fully mitigated any future losses.
“The complainant was a successful entrepreneur and has every right to pursue that goal to re-establish himself in a similar role that he was dismissed from. He has used his time well to do this,” Mr Dalton wrote.
He said it was “remarkable” Mr Kiely, at 58, had been able to get back into business in just 17 months. “That demonstrates considerable effort and tenacity, and that time was used well,” Mr Dalton added.
A further award of €24,000, compensation equivalent to four weeks’ notice pay, for a breach of the Minimum Notice and Terms of Employment Act, 1973 brought the total sum awarded to Mr Kiely to €464,000.
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