RSA Ireland head requested help from chairman, tribunal hears

Philip Smith allegedly sought assistance before internal inquiry

Philip Smith, former chief executive of RSA Ireland, arriving at the Employment Appeals Tribunal. The tribunal heard that Mr Smith rang the chairman of the company’s Irish board on the day the terms of an internal financial inquiry were being framed. Photograph: Dave Meehan

Philip Smith, former chief executive of RSA Ireland, arriving at the Employment Appeals Tribunal. The tribunal heard that Mr Smith rang the chairman of the company’s Irish board on the day the terms of an internal financial inquiry were being framed. Photograph: Dave Meehan

 

Former RSA Ireland chief executive Philip Smith rang the chairman of the insurer’s Irish board and asked: “Can you do your best for me?” on the day that the insurer’s non-executive directors were framing the terms of reference for an internal investigation into certain financial issues at the company, the Employment Appeals Tribunal (EAT) has heard.

The claims were made during a hearing brought by Mr Smith against RSA for constructive dismissal in 2013.

Leo Blennerhassett, who became chairman of RSA Ireland in 2011, said Mr Smith rang him on his mobile phone on October 21st, 2013. He said he thought this was strange as they were both in RSA’s head office at the time.

“I said [to Mr Smith] ‘yeah’, I didn’t think anything was wrong necessarily,” Mr Blennerhassett said. The pair had previously worked together at consulting group Accenture, where Mr Smith had “performed very well and was well liked”, according to Mr Blennerhassett.

Mr Blennerhassett said he was first made aware of an issue around reserving on October 17th, 2013, when Paul Kierans, then chief risk officer of the company’s Irish branch, informed him that there was a potential problem.

Mr Blennerhassett said he asked Mr Kierans if they were in “fine territory”, a reference to whether the problem might lead to a financial sanction by RSA Ireland’s regulator, the Central Bank of Ireland. Mr Kierans said: “Yes.”

Mr Blennerhassett was told there were issues around reserves that were recommended on individual claims files not being “properly put up on the system”.

‘No external influence’

Earlier, Vanessa Evans, group head of human resources at RSA, said no external influence was brought to bear on the investigation into the reserving issues.

Mr Smith has claimed that the outcome of the investigation was pre-ordained.

Ms Evans conducted the investigation with Derek Walsh, group legal counsel, as part of the Project White, which was set up by a subcommittee of the insurer’s Irish board to investigate the financial issues.

Ms Evans said she was satisfied the investigation had been run in a fair manner.

Tom Mallon, counsel for Mr Smith, questioned Ms Evans on the processes used in compiling the investigation’s report, and also questioned her on whether it was appropriate to have Mr Kierans on the subcommittee that would investigate these matters given his role within the company.

Mr Mallon also asked why it was that so many people had made claims about Mr Smith’s “bullying” style of management during their interviews but that they had never complained to the company, acted as whistleblowers or even left RSA during Mr Smith’s time in charge.

Mr Mallon asked why, if Mr Smith was the problem, that so many of the senior team at RSA Ireland had left the business since his resignation in November 2013.

Mr Blennerhassett said the new chief executive Ken Norgrove had wanted to make a number of his own appointments, to make a “clean start”.

The hearing adjourned until May 11th for final submissions by both sides. Niamh O’Carroll-Kelly, who chaired the hearing, asked for written submissions to be exchanged by counsel and provided to the EAT on April 30th.