FULL RECOMMENDATION
SECTION 15(1), PROTECTION OF EMPLOYEES (FIXED-TERM WORK) ACT, 2003 PARTIES : IRISH RAIL - AND - MALCOLM STEAD (REPRESENTED BY TRANSPORT SALARIED STAFFS' ASSOCIATION) DIVISION : Chairman: Ms Jenkinson Employer Member: Mr Doherty Worker Member: Ms Ni Mhurchu |
1. Appeal against Rights Commissioner's Decision FT17985/03.
BACKGROUND:
2. The claimant was one of a number of contract Assistant engineers initially employed in the Telecoms Dept. part of Iarnr�d Eireann Infrastructure maintenance division on a fixed term contract between the period 29th October 2001 to the 29th October 2003. In September 2003 the engineers were advised that there should be no assumptions made regarding the renewal of their contracts. Following a review contracts were renewed for a period of 4 months to the 25th February 2005. The claimant repeatedly sought reassurances that positions would be offered to the engineers at the end of this period.
On the day of the expiration of the contract the claimant felt vulnerable in so far as he had no new contract and felt he had no option but to go. He reluctantly signed a form to accept a statutory redundancy sum.
The Protection of Employees (Fixed-Term Work) Act, 2003, was introduced in to Irish Law on the 14th July, 2003. The Act seeks to improve the conditions of "Fixed-Term" employment by prohibiting less favourable treatment of fixed term workers than comparable permanent workers.
The matter was referred to a Rights Commissioner for investigation. His decision issued on the 7th September, 2004, as follows:
"I do not believe that Iarnrod Eireann's treatment of Mr Stead, either during his employment or in terminating his employment, was in breach of the Act.
While Mr Stead's initial contract was allowed to run beyond the expiry date, he then accepted a further fixed-term contract that would end on 29th February, 2004. His employment ended on that date and he received statutory terms to cover the period of his employment. Accordingly I find against Mr Stead's claim."
On the 4th November, 2004, the Union appealed the Rights Commissioner's Decision to the Labour Court in accordance with Section 15(1) of the Protection of Employees (Fixed-Term Work) Act, 2003. A Labour Court hearing took place on the 16th February, 2005.
DETERMINATION:
This appeal by TSSA is on behalf of the complainant who was employed on a fixed term contract with the Company from 29th October 2001 until 29th October 2003 and from 29th October 2003 until 29th February 2004. The Union contends that Mr. Stead’s treatment by the Company in relation to the renewal or non-renewal of his contract of employment was in breach of the section 8 of the Protection of Employees (Fixed-Term Work) Act, 2003 (the Act).
The Union contends that Mr. Stead was treated less favourably than two comparable permanent employees, as he was not offered an opportunity to join the Company’s pension scheme and was not offered an opportunity to be part of the G.P. Medical Scheme, which was open to comparable permanent employees but not to fixed term contract staff. It maintained that these constitute less favourable treatment by the respondent, contrary to section 6 of the Act.
The Union contends that Mr. Stead was not informed of other positions in the same department or offered training opportunities to enhance his career development, contrary to section 10 of the Act.Background
Mr. Stead was employed on a fixed term contract with the Company from 29th October 2001 until 29th October 2003 as an Assistant Engineer in the Signal, Electrical and Telecommunications Department.
On 31st October 2003 he was informed in writing that his contract would not be renewed.
He was informed that as he had two years service with the company that he would quality for statutory redundancy on exit. His exit date was given as 26th November 2003. Subsequently his contract was renewed until 29th February 2004.
Prior to the expiry of both contracts, Mr. Stead sought assurances from the Company that his contracts would be renewed. The Company gave no indication, verbally or in writing, as to whether the contacts would be renewed as either fixed term contracts or a contract of indefinite duration. On the expiration of the contract in February 2004, Mr. Stead felt he had no option but to accept statutory redundancy.
Both parties agreed that the comparators were appropriate comparable permanent employees.
The Complainant’s Case
-Mr. Stead did not receive any notification in writing (or verbally) that his contracts were to be renewed. There was no objective grounds for issuing the four-month contract, which expired on 29th February 2004, as there was a massive volume of work available.
-Mr. Stead was treated less favourably than the comparable permanent employees in regard to terms and conditions; he was not offered to be included in the Company’s defined benefit pension scheme or the G.P.Medical Scheme.
-Mr. Stead left the company as he felt that he was in a vulnerable financial situation and was left with no option but to leave, as he had no commitment from the respondent that his contract would be renewed or made permanent. He reluctantly accepted a statutory redundancy payment.
-Mr. Stead was selected for compulsory redundancy contrary to Company/Union agreement that termination of employment shall be on a voluntary basis with no compulsory redundancies, through redeployment or retraining. Mr. Stead’s employment was not renewed “because of a need to reduce the deficit of 2003 and a downturn in revenue available for investment”.
-The Union contented that there were no objective reasons for the termination of the contracts as there was an immense amount of work which was not completed when the Assistant Engineers’ contract were not renewed.
-Mr. Stead was not informed of other positions in the same department, which became available or offered training to enhance his career development.
-Mr. Stead sought compensation. He stated that the difference in his current salary and his salary while employed by the respondent is €28,000, and he sought loss of earnings over a two-year period.
The Respondent’s Case
-Mr. Stead was one of a number of contract Assistant Engineers initially employed in the Telecoms Department on fixed term contracts between the period 29th October 2001 and the 29th October 2003. While they were advised prior to the expiry of the contract that the contracts might not be renewed, a process was underway whereby certain parts of the work content of Mr. Stead and his colleagues might migrate to capital funded projects.
-Subsequently, Mr. Stead was informed that his contract was being renewed for a period of 4 months, during which time the workload was to be investigated to decide on future work arrangements. The work for which Mr. Stead was originally employed was connected with track renewal was winding down.
-The respondent indicated to Mr. Stead that it was highly likely that approval would be given for renewal of his contract and that a number of positions would be advertised. Despite this, the appellant decided of his own accord, to exit the company prior to the termination of his contract in early February 2004 and was paid statutory redundancy. He was never given an indication that his employment would lead to permanency within the Company.
-There were six specialised positions filled which were advertised in the weekly circular, a circular that Mr. Stead was required to have access to in order to complete his weekly duties. Mr. Stead would not have had the appropriate skills for these positions.
-The respondent stated that it had met its obligation in respect of PRSA provision which was available to staff excluded by rule from the statutory CIE pension scheme.
The Law
Protection of Employees (Fixed- Term Work) Act 2003.
Conditions of employment for fixed-term employees
Section 6. - (1) "Subject to subsections (2) and (5), a fixed-term employee shall not, in respect of his or her conditions of employment, be treated in a less favourable manner than a comparable permanent employee."
(2) "If treating a fixed-term employee, in respect of a particular condition of employment, in a less favourable manner than a comparable permanent employee can be justified on objective grounds then that employee may, notwithstanding subsection (1), be so treated."
- Section 7 (1) " A ground shall not be regarded as an objective ground for the purposes of any provision of this Part unless it is based on considerations other than the status of the employee concerned as a fixed-term employee and the less favourable treatment which it involves for that employee (which treatment may include the renewal of a fixed-term employee’s contract for a further fixed term) is for the purpose of achieving a legitimate objective of the employer and such treatment is appropriate and necessary for that purpose."
- Section 8 (2) " Where an employer proposes to renew a fixed-term contract, the fixed-term employee shall be informed in writing by the employer of the objective grounds justifying the renewal of the fixed term contract and the failure to offer a contract of indefinite duration, at the latest by the date of the renewal. "
- Section 10 (1) "An employer shall inform a fixed-term employee in relation to vacancies, which become available to ensure that he or she shall have the same opportunity to secure a permanent position as other employees.
- (2) The information referred to insubsection (1)may be provided by means of a general announcement at a suitable place in the undertaking or establishment.
(3) As far as practicable, an employer shall facilitate access by a fixed-term employee to appropriate training opportunities to enhance his or her skills, career development and occupational mobility."
- (2) The information referred to insubsection (1)may be provided by means of a general announcement at a suitable place in the undertaking or establishment.
The respondent accepts that by the renewal date of first fixed term contract, Mr. Stead was not informed in writing of the objective condition justifying the renewal of the contract, instead, on 30th October 2003 he was informed in writing that the Company was not in a position to renew his contract due to the need to reduce the deficit of 2003 and a downturn in revenue. This letter stated that his exit date was 26th November 2003 and indicated that he would qualify for statutory redundancy payment on exit. As a result of Union involvement, the Company subsequently extended his contract to 29th February 2004.
The Court finds that the respondent’s failure to provide a written statement by the renewal date of 29th October 2003 constitutes an infringement of the Act, under Section 8 (2) “Where an employer proposes to renew a fixed-term contract……”.
Under section 8 (4) of the Act, the Labour Court may draw an inference from the employer’s failure to provide a written statement. The day after the expiry of the contract, the respondent supplied a written statement indicating that his contract would not be renewed and that he would be entitled to a statutory redundancy payment but this was subsequently rescinded after Union intervention and a four month contract was issued. The Union stated to the Court that there was no necessity to issue a four-month contract, as there was a massive volume of work available.
The failure to provide a written statement to the complainant prior to 29th February 2004 in accordance with Section 8 of the Act, as if the Act did not exist, is in the Court’s view an indication of the Company’s lack of compliance of the their statutory obligation, which obviously needs to be addressed and rectified.
The respondent did not deny that the defined benefit pension scheme applies to the permanent employees and not to the (fixed term worker) appellant. The rules of the scheme exclude such workers from entry to the scheme. Similarly, the respondent did not deny that G.P. Medical Scheme applies to the permanent employees and not to the (fixed term worker) appellant. The respondent did not put forward arguments under the ‘objective grounds’ to justify the differences in treatment of these schemes. Therefore, the Court finds Mr. Stead was treated less favourably than the comparable permanent employees, and this constitutes less favourable treatment by the respondent, contrary to section 6 of the Act.
The Court finds Mr. Stead was not informed of other positions in the same department or offered training opportunities to enhance his career development, and this constitutes an infringement by the respondent of section 10 of the Act.
Determination
Taking all the circumstances of this case into account the award which the Court considers reasonable is measured at €7,500. The complainant is awarded compensation in that amount.
The complainant’s appeal is well founded. Accordingly, the Court overturns the Rights Commissioner’s decision and allows the appeal.
The Court so determines.
Signed on behalf of the Labour Court
Caroline Jenkinson
1st March, 2005______________________
MG.Deputy Chairman
NOTE
Enquiries concerning this Determination should be addressed to Madelon Geoghegan, Court Secretary.