Ex-SocGen Director Sues Over Firing, Withheld Bonus Pay

A former Societe Generale SA director who oversaw Dutch derivatives trading sued the bank in Britain for unfair dismissal, withholding his final bonus and failing to consult him and co-workers before a group layoff.

Folef Hooft Graafland, 44, who worked in Societe Generale’s London office, was fired in February 2012 as part of a cost-cutting program. He wasn’t given the five months’ notice required under his employment contract, meaning the firing by the French bank wasn’t effective, his lawyer Giles Powell said during a hearing last week at a U.K. employment tribunal.

“I believe that the summary dismissal for redundancy” without notice “was a breach of contract which I did not accept and that, as a result, it did not bring my contract of employment to an end,” Graafland said in court papers.

Graafland, who was the only director in the Derivative Solutions Group Netherlands, had worked for the Paris-based bank since 2006. The judge overseeing the case is resolving several preliminary issues before a full trial, including whether Graafland was technically fired and whether his case can be used to represent a class of at least 20 others.

Murray Parker, spokesman for Societe Generale in London, declined to comment on the allegations.

Societe Generale fired Graafland because he and his area of the business were under-performing, and because he was the only director in his team, Zoe Hoult, a human-resources employee at the bank, said in a witness statement filed with the court.

2010 Contract

The dispute hinges on whether Societe Generale had the legal right to pay Graafland five months of his salary instead of giving him five months’ notice. Graafland argues a 2010 contract he signed doesn’t include provisions for such a payment instead of advanced notice. The bank argues the procedure is approved in its employee handbook.

“The handbook forms part of the terms and conditions of the claimant’s employment,” Hoult said in the statement.

U.K. employment law requires companies to consult workers or their representatives when they’re planning to fire more than 20 people, Powell said. Societe Generale didn’t consult Graafland or his co-workers, he said.

Societe Generale decided in January 2012 to cut costs as a result of changing market conditions, Hoult said. Graafland was approached by his manager on the bank’s trading floor on Feb. 20, 2012, and asked to attend a meeting.

“It was apparent that the claimant suspected what the purpose of the meeting would be,” because he “decided to bring his personal items with him,” Hoult said. When asked if he had any questions, Graafland didn’t react. During the meeting and the following week, Graafland didn’t challenge the firing or attempt to return to the office, returned the bank’s property, and kept his final payment, Hoult said.

Graafland, “had clearly been dismissed,” Hoult said. “If he did think that he was still employed, he would not have returned his BlackBerry,” she said.

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