FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 15(1), PROTECTION OF EMPLOYEES (FIXED-TERM WORK) ACT, 2003 PARTIES : DUBLIN INSTITUTE OF TECHNOLOGY (REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION) - AND - MR DAN BARRY (REPRESENTED BY LEMAN SOLICITORS) DIVISION : Chairman: Mr Hayes Employer Member: Mr Murphy Worker Member: Ms Tanham |
1. Appeal of Rights Commissioner's Decision r-112995-ft-11/EH.
BACKGROUND:
2. The Worker appealed the Rights Commissioner's Decision to the Labour Court. Labour Court hearings took place on the 27th April, 2012 and on the 1st October, 2012. The following is the Labour Court's Decision:-
DETERMINATION:
Background
The Complainant, Mr Barry (“the Complainant”) was employed by the Dublin Institute of Technology (“DIT” or “the Respondent” or “the Employer”) on 1 June 2006 on the first of a series of fixed term contracts of employment. The Contract describes the position he held in the following terms: “Manager of Audio Research Group & Senior Researcher. The initial fixed term contract of employment expired on the 31stOctober 2008. This was followed by a second fixed term contract that ran from the 1stNovember 2008 until the 31stMarch 2009. This was followed by a further fixed term contract of employment that commenced on the 1stApril 2009 and expired on the 31stJanuary 2011. The complainant was informed on the 20thJanuary 2011 that the fixed term contract of employment would not be renewed. The Project Director applied to the College to have the fixed term contracts of employment further extended. On the 5thApril 2011 the College approved a further extension that, for various reasons, both sides agreed would commence on the 7thApril and expire on the 8thNovember 2012.
Over this period the Complainant was involved in a series of research projects that were either wholly or partially externally funded.
Issues
It is common case that the complainant was employed on a series of successive fixed term contracts of employment the aggregate duration of which exceeded four years. It is also common case that the contract of employment issued to the Complainant in April 2009 was for a period of time that, unless it was saved by the provisions of Section 9(4) of the Act would have brought him within the scope of Section 9(2) of the Act and taken together with Section 9(3) of the Act entitles him to a contract of indefinite duration. The Respondent relies on the provisions of Section 9(4) arguing that there were objective grounds justifying the renewal of the fixed term contract at that time. On this basis it submits the provisions of Section 9(2) of the Act are of no effect in this case and the Complainant has no entitlement to a contract of indefinite duration.
Section 9 of the Act in relevant part provides:
- 9(2) Subject to subsection (4) , where after the passing of this Act a fixed-term employee is employed by his or her employer or associated employer on two or more continuous fixed-term contracts and the date of the first such contract is subsequent to the date on which this Act is passed, the aggregate duration of such contracts shall not exceed 4 years.
(3) Where any term of a fixed-term contract purports to contravene subsection (1) or (2) that term shall have no effect and the contract concerned shall be deemed to be a contract of indefinite duration.
(4) Subsections (1) to (3) shall not apply to the renewal of a contract of employment for a fixed term where there are objective grounds justifying such a renewal.
- 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.
(2) Where, as regards any term of his or her contract, a fixed-term employee is treated by his or her employer in a less favourable manner than a comparable permanent employee, the treatment in question shall (for the purposes of section 6(2) ) be regarded as justified on objective grounds, if the terms of the fixed-term employee’s con-tract of employment, taken as a whole, are at least as favourable as the terms of the comparable permanent employee’s contract of employment.
The provisions of Section 7(2) of the Act largely restate the three tier test set out by the Courts of Justice of the European Union inBilka-Kaufhaus GmbH v Weber von Hartz [1986] IRLR 317 Eregarding the meaning the meaning to be ascribed to the term “objective reasons” within the meaning of Clause 5(1) of the Framework Agreement.
The Court in this regard notes also the decision of the European Court of Justice inAdeneler and Others – v –Ellinikos Organismos Galaktos[2006] IRLR 716 P50 where it said:
- “… the concept of objective reasons within the meaning of clause 5 (1) (a) of the Framework Agreement, must be understood as referring to precise and concrete circumstances characterising a given activity, which are therefore capable in that particular context of justifying the use of successive fixed-term employment contracts.”
It further notes the judgement of the CJEU on this point in Joined Cases C-378/07 to C-380/07Kiriaki Angelidaki and Others v Organismos Nomarkhiaki Aftodiikisi Rethimnis and Dimos Geropotamou[2009] ECR 1-3071, where it said at paragraph 96
" In those circumstances, the concept of ‘objective reasons’ for the purposes of clause 5(1)(a) of the Framework Agreement must, as the Court has already held, be understood as referring to precise and concrete circumstances characterising a given activity, which are therefore capable, in that particular context, of justifying the use of successive fixed-term employment contracts. Those circumstances may result, in particular, from the specific nature of the tasks for the performance of which such contracts have been concluded and from the inherent characteristics of those tasks or, as the case may be, from pursuit of a legitimate social-policy objective of a Member State (Adeneler and Others, paragraphs 69 and 70; Case C-307/05 Del Cerro Alonso [2007] ECR I-7109, paragraph 53; and order in Vassilakis and Others, paragraphs 88 and 89)".
The Court went on, at paragraph 103 of its judgment, to draw a distinction between successive contracts the purpose of which are to meet needs which are temporary in nature and those which, in reality, are intended to cover the fixed and permanent needs of the employer. In the case of the former the use of successive fixed-term contracts may be legitimate but in the case of the latter their use would be contrary to the objective pursued by the Directive.
What the Court must decide in this case is whether the grounds set out by the Respondent for not offering the Complainant a contract of indefinite duration and instead offering him a further fixed term contract of employment in April 2009, amount to “objective reasons” within the meaning of Section 9(4) of the Act.
The Position of the Respondent
The Respondent argues that complainant was employed on a series of discrete fixed term contracts that were each externally funded by different sources and related to distinct and self contained pieces of research though each emanated from and developed his specific field of technical expertise.
The fixed term contract in issue before the Court commenced on the 1stof April 2009. The contract was for work on the “MRCT –Trezur” project that was externally funded by Enterprise Ireland Industrial Partnership Fund. Prior to this, the complainant had been working on the “IMAAS –Interactive Music Archive Access System” project that had been externally funded by Enterprise Ireland though through its Commercialisation Fund.
In support of its argument the Respondent draws the Court’s attention to the provision in the Contract of Employment that states“the continuation of the post is subject to external funding”.This it argues sets out the objective justification for the decision not to offer the Complainant a contract of indefinite duration.
Position of the Complainant
The Complainant argues that he was employed at all times by the Respondent as “Manager of Audio Research Group & Senior Researcher” and led and worked in a research facility/group that sought external funding from various bodies with the aim of undertaking original research on behalf of clients and commercialising academic research otherwise conducted by the College. He argues that the work of the unit reflects beneficially on the academic and research standing of College and earns significant amounts of income from royalties for the Institute. He notes that Research staff members earn income from the intellectual property rights they retain in the output of their research.
Findings of the Court
The Complainant, in accordance with the provisions of Section 9(2) of the Act, became entitled, by operation of law, to a contract of indefinite duration, with effect from the 1stApril 2009 unless the Respondent can avail of the defence set out in Section 9(4) of the Act. In order to do that the Respondent must establish, to the satisfaction of the Court, the “objective grounds” upon which it seeks to rely.
In this case the Respondent argues that the very fact that the research project in which the Complainant is engaged is externally funded constitutes objective grounds within the meaning of the Act. The Respondent argues that the letter of offer of employment dated 30thApril 2009 contained the following condition and was accepted by the Complainant: -
- “The Institute is offering you a Fixed Term contract rather than a contract of employment of indefinite duration because the continuation of the post is subject to external funding.”
It supports this position by arguing that the research project undertaken by the Complainant was in this case externally funded and custom designed by the client.
The Court does not accept this argument. On the evidence presented the Court finds that the Institute operated a research group that offered specialist research services to external bodies on a commercial basis. The research group was a fixed and permanent body within the Institute for as long as it was capable of attracting business from potential clients. It employed the complainant as part of that group and variously deployed him on successive projects that the group was successful in attracting to the Institute. To this extent the Complainant’s employment met a fixed and permanent need of the Research Group and by extension the institute and the successive projects that it attracted provided the funding from which the Complainant’s employment costs were met.
The Court finds that the Institute failed to distinguish between the permanent status of the research group and the discrete nature of each of the research projects. As one project came to an end the group did not disappear, it sought replacement projects from other potential clients. The Complainant was a fixed and permanent member of the group and was paid out of the finances generated by each of the successive projects the group or Institute secured. In this regard it is no different to firms offering professional services to clients on a project basis.
Accordingly the Court finds that the Complainant became entitled to a contract of indefinite duration by operation of law on the 1stApril 2009.
Section 8
The Complainant submits that the Respondent contravened the provisions of Section 8 (2) of the Act when in May 2011 it renewed his fixed term contract of employment without giving him advance notice of the objective grounds for that decision and for the decision not to offer him a contract of indefinite duration.
The Respondent submits that by letter of the 5thMay 2011 it notified the Complainant of its intention to renew the fixed term contract of employment for a further period of time together with its reasons for so doing.
The Complainants submit that they did not receive that letter until after the date for the renewal of the contracts had passed.
Findings of the Court
On balance the Court accepts the evidence of the Complainants that the letter was received after the date on which their fixed term contracts were renewed. The Court finds that the Respondent breached the provisions of Section 8(2) of the Act.
Determination
The Court determines that the Complainant, pursuant to the provisions of Section 9(2) of the Act became entitled to a contract of indefinite duration with effect form 1 April 2009. The Court further determines that the Respondent failed to establish objective grounds within the meaning of Section 9(4) of the Act such as would justify the renewal of the fixed term contract at that time.
In addition the Court determines that the Respondent, contrary to the provisions of Section 8(2) of the Act, failed to notify the Complainant of the reason for the decision not to offer him a contract of indefinite duration in May 2011.
The Court orders the Respondent to reinstate the Complainant on a contract of indefinite duration with immediate effect and to pay the Complainant compensation in the sum of €2,500.00.
The Court so determines.
Signed on behalf of the Labour Court
Brendan Hayes
12th November, 2012______________________
JMcCDeputy Chairman
NOTE
Enquiries concerning this Determination should be addressed to Jonathan McCabe, Court Secretary.