Smith claims he was subject of ‘character assassination’

Former RSA Insurance Ireland chief executive Philip Smith has told the Employment Appeals Tribunal that he was subjected to a "character assassination" in a draft report submitted by the company to the Central Bank of Ireland in November 2013.

He said this was part of a “concerted effort” by RSA to “effect my dismissal” and was at variance with the “positive relationship” he had enjoyed with staff. Mr Smith said this characterisation of him as a bully was a “hammer blow” given his “strong engagement with people”.

The report was given to the Central Bank before being furnished to Mr Smith, the hearing was told. Mr Smith is taking a constructive dismissal case against RSA following his departure from the company in November 2013 after certain financial issues had emerged.

Mr Smith was one of three executives at the Irish business that had been suspended by RSA earlier that month.

The report was compiled by Vanessa Evans, RSA's group head of human resources, and Derek Walsh, the insurer's group general counsel, for a sub committee of the board under the terms of Project White, which was charged with looking at certain reserving issues.

Mr Smith said the second half of the report dealt with “culture” issues around his management style, which was outside its terms of reference. He said at no stage was he informed that there would “any investigation” of his character.

Mr Smith said he had enjoyed a “strong positive working relationship” with his team and had attended a number of their weddings.

Mr Smith resigned in late November 2013 and his letter to RSA was read out to the hearing.

In the letter, Mr Smith noted how €10 million of RSA Ireland's reserve margin had been used for group purposes to offset difficulties in Italy.

The hearing was told that Mr Smith was paid €405,000 in basic salary as CEO of RSA Ireland, plus an annual bonus that averaged at about €100,000, a car allowance of €57,000 and was a member of its defined benefit pension scheme.

RSA said his total earnings amounted to €3.8 million during his employment with the insurer.

Since his departure from RSA his gross earnings have amounted to €25,000 and he has relied on financial support from family and friends to support his family. He claimed that RSA had obstructed his attempts to secure consultancy work, an allegation that RSA disputed with the chair.

RSA opened its cross examination by focusing on Mr Smith’s knowledge of specific claims. In one case a drunk driver crashed into another vehicle, killing the driver. A reserve of €2.425 million was proposed in an internal process but by October 23rd 2013 a reserve of just €20,0001 was in place.

Mr Smith had told his superiors that medical evidence was being awaited in this case. Brian O’Moore, counsel for RSA, put it to him that no medical evidence was actually required in this case. Mr Smith said he did not recall the full details of the case.

On November 8th 2013, RSA suspended Mr Smith pending the outcome of an investigation into issues in the Irish claims and finance functions that were identified during an internal audit. On November 28th, RSA revealed that Mr Smith had resigned and said no severance payment had been made.

The EAT hearing, which is being chaired by Niamh O’Carroll-Kelly, has set aside five days for the hearing.