FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 15(1), PROTECTION OF EMPLOYEES (FIXED-TERM WORK) ACT, 2003 PARTIES : INSTITUTE OF ART, DESIGN & TECHNOLOGY (REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION) - AND - MR FREDERIC HERRERA (REPRESENTED BY WENDY DOYLE SOLICITORS) DIVISION : Chairman: Mr Hayes Employer Member: Ms Doyle Worker Member: Ms Tanham |
1. Appeal of Rights Commissioner's Decision r-121235-ft-12/SR.
BACKGROUND:
2. The Employer appealed the Rights Commissioner's Decision to the Labour Court on the 14th September, 2012. A Labour Court hearing took place on the 14th December, 2012. The following is the Labour Court's Decision:-
DETERMINATION:
Dun Laoghaire Institute of Art, Design and Technology (the “Institute” or “the Appellant”)has brought this appeal pursuant to s. 15(6) of the Protection of Employees (Fixed-Term Work) Act 2003 (the "Act") against Decision number r-121235-ft-12/SR of the Rights Commissioner made on 17thAugust 2012 (the "decision").
The Rights Commissioner decided that a complaint from Mr Frederic Herrera (the "complainant") pursuant to the Act was well-founded, and directed the appellant to pay the respondent compensation of€30,000arising out of the infringements of his entitlements under the Act.
Background
The complainant was employed on a fixed term contract of employment from the 4thMarch 2004 until his employment was terminated on 4thMay 2012. He was employed as an Enterprise Development Executive for the purpose of rolling out the “Create Enterprise Platform Programme”, an Enterprise Ireland funded Project. When the contract came to an end he was made redundant. The appellant paid him his entitlements under the Redundancy Payments Act. The fact of redundancy and the complainant's entitlement to redundancy pay are not in dispute.
On the 27thMarch 2012 the he referred a complaint to the Rights Commissioner, alleging that, contrary to s. 6(1) of the Act, he had been treated in a less favourable manner than a comparable permanent employee. He specifically complained that he had not been paid the sameex gratiaredundancy payment as four identified comparators as within the meaning of s. 5 of the Act.
The Rights Commissioner issued his decision on the 17thAugust 2012. He decided that the respondent's claim was well-founded and awarded him €30,000 compensation. By notice of appeal dated12th September 2012 the Institute appealed to the Labour Court against the Rights Commissioner’s decision. The case came on for hearing on 14thDecember 2012. The facts of the case are not in dispute.
Complainant’s Position
The Complainant submits that as a fixed term worker he is, pursuant to section 6 of the Act, entitled to be treated no less favourably than a comparable permanent employee in respect of his terms and conditions of employment including remuneration. Citing the decision of the CJEU inCase C262/88 Barber v Guardian Royal Exchange Assurance [1990] ECR 1-1889he submits that ex gratia redundancy payments constitutes remuneration within the meaning of the Act. He submits that the Labour Court affirmed this decision in bothSunday World Newspapers v Kinsella and Bradley [2006] 17 ELR 325and inUniversity College Cork and Dr Naomi Bushin FTC/10/42 Determination Number FTD1121. He submits that as no comparable permanent worker employed in the Institute has been made redundant and there is no relevant collective agreement in operation he is entitled to rely on the provisions of Section 5(1) (c) of the Act for the purposes of identifying a comparable permanent employee. In doing so he relies on the Determination of this Court inState Laboratory v McArdle (FTC/05/11 Determination No.063)in asserting his right to choose his own comparator for the purposes of the Act.
He identifies four comparators 1) Permanent staff of Saint Catherine’s College of Education for Home Economics 2) A permanent employee of the Royal College of Surgeons 3) Permanent catering staff in the National University of Ireland Maynooth and 4) A permanent employee in Wexford VEC. He submits that he is within the meaning of Section 5(1)(c) of the Act and having regard to “such matters as skill, physical or mental requirements, responsibility and working conditions”, performing work of equal or greater value than that performed by each of the chosen comparators.
He submits that the respondent has not, within the meaning of Section 7 of the Act, set out any “objective justification” for treating him in such a less favourable manner than all or any of the chosen comparators. Accordingly he argues that the Appellant has, on the termination of his employment, infringed his entitlement under section 6 of the Act by treating him in a less favourable manner that a comparable permanent employee in relation to the payment of an ex gratia redundancy payment. He asks the Court to uphold the decision of the Rights Commissioner and reject the appeal.
Appellant’s Position
The Appellant submits that it is required to carry out the instructions of the Departments of Education and Finance and is only permitted to pay the complainant statutory redundancy pay in accordance with the provisions of the Redundancy Payments Act 1967 - 200, It further submits that shortly after the complainant was made redundant a collective agreement was concluded between the Public Service Unions and the State that, in cases of reduendancy, provides for the payment of an ex gratia payment of three week’s pay per of service in addition to statutory redundancy entitlements. It states that it offered to apply the terms of that agreement to the Complainant but he rejected the offer. It submits that Section 14 (d) of the Act confers on the Court a wide discretion regarding the level of compensation it may award a Complainant where a breach of the Act occurs. It submits that the Court should take into account the constraints under which it operates and its willingness to offer the complainant the terms of the collectively agreed ex gratia severance terms as soon as it received permission to do so. Accordingly it asks the Court to uphold the appeal and set aside or otherwise moderate the Rights Commissioner’s decision.
The Appellant submits that, without permission from the relevant government departments it did not have authority, at the relevant time, to pay enhanced redundancy payments to any member of staff. Accordingly it paid the complainant his statutory entitlement on termination of his employment.
Findings of the Court
LEGISLATION
Section 5 of the Act provides:-
- "(1) For the purposes of this Part, an employee is a comparable permanent employee in relation to a fixed-term employee if:-
(a) the permanent employee and the relevant fixed-term employee are employed by the same employer or associated employers and one of the conditions referred to in subsection (2) is satisfied in respect of those employees,
(b) in case paragraph (a) does not apply (including a case where the relevant fixed-term employee is the sole employee of the employer), the permanent employee is specified in a collective agreement, being an agreement that for the time being has effect in relation to the relevant fixed-term employee, to be a type of employee who is to be regarded for the purposes of this Part as a comparable permanent employee in relation to the relevant fixed-term employee, or
(c) in case neither paragraph (a) nor (b) applies, the employee is employed in the same industry or sector of employment as the relevant fixed-term employee and one of the conditions referred to in subsection (2) is satisfied in respect of those employees, and references in this Part to a comparable permanent employee in relation to a fixed-term employee shall be read accordingly."
"(2) The following are the conditions mentioned in subsection (1):-
(a) both of the employees concerned perform the same work under the same or similar conditions or each is interchangeable with the other in relation to the work,
(b) the work performed by one of the employees concerned is of the same or a similar nature to that performed by the other and any differences between the work performed or the conditions under which it is performed by each, either are of small importance in relation to the work as a whole or occur with such irregularity as not to be significant, and
(c) the work performed by the relevant fixed-term employee is equal or greater in value to the work performed by the other employee concerned, having regard to such matters as skill, physical or mental requirements, responsibility and working conditions."
The relevant subsections of s. 6 of the Act provide:-
"(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 of the Act provides:
"(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 contract of employment, taken as a whole, are at least as favourable as the terms of the comparable permanent employee's contract of employment."
DECISION
It is common case that the complainant was employed by the respondent on a series of fixed term or fixed purpose contracts of employment within the meaning of the Act. It is also common case that he was made redundant and paid his statutory entitlement on the termination of his employment. It is common case that no comparable full time worker was made redundant by the Institute and it is common case that, at the relevant time, no collective agreement regarding the payment of ex gratia redundancy pay was in place between the social partners in either the institute or the Sector. It is common case that ex gratia redundancy payments constitute remuneration for the purposes of the Act. The respondent acknowledges the Complainant’s right to rely on the provisions of Section 5(1)(c) of the Act and choose a comparator within the relevant sector: in this case the third level education sector. The Complainant identified four comparators each of whom was paid an ex gratia redundancy payment in addition to their statutory entitlements. The Respondent raised no objection to the comparators chosen nor to the contention that the work performed by the complainant was equal or greater in valuetothe work performed by them, having regard to such matters as skill, physical or mental requirements, responsibility and working conditions. The respondent did not contest the assertion that each of the comparators were paid an ex gratia redundancy payment. The Appellant did not invoke the provisions of Section 7 of the Act.
Taking the totality of the submissions into account the Court determines that the complaint is well founded.
Remedy
In considering the remedy in this case the Court is constrained by the provisions of Section 15(1) of the Act that provides: -
- "(1) A party concerned may appeal to the Labour Court from a decision of a rights commissioner under section 14 and, if the party does so, the Labour Court shall—
- (a) give the parties an opportunity to be heard by it and to present to it any evidence relevant to the appeal,
(b) make a written determination in relation to the appeal affirming, varying or setting aside the decision, and
(c) communicate the determination to the parties."
- (a) give the parties an opportunity to be heard by it and to present to it any evidence relevant to the appeal,
In relation to Section 15(1)(b) above the Appellant asks the Court to vary the decision of the Rights Commissioner. It submits that the restrictions imposed on it by way of legislation and Departmental supervision limit its freedom to discharge its obligations under the Act. It states that it did not have permission to offer the complainant an enhanced redundancy payment when his employment terminated. It states that without permission it was powerless to act otherwise. It states that shortly after the Institute made the Complainant redundant the social partners reached agreement on enhanced ex gratia redundancy terms for all redundant public servants. It states that it immediately sought and was granted permission to offer the Complainant the terms of that agreement. It acknowledges that he was entitled to reject the offer. However it submits that this is evidence that an award of compensation that would dissuade it against a future infringement of the Act is not necessary. Accordingly it asks the Court to vary the Rights Commissioner’s decision accordingly.
The Respondent submits that the Appellant infringed his rights under Section 6 of the Act and only made an offer to him after the Rights Commissioner had upheld the complaint. The offer made was considerably less than the amount the Rights Commissioner had awarded him. Accordingly he submits the offer the Institute made was not for the purpose of righting the wrong done to him but rather to reduce the level of the award made against it. He asks the Court to affirm the Rights Commissioner’s decision.
The Court notes that it is common case that the ex gratia redundancy payment claimed by the Complainant amounts to €21,200. The Court also notes that the Rights Commissioner awarded the Complainant compensation in the amount of €30,000. In reaching his decision the Rights Commissioner may have been aware of the decision of the CJEU (formally the ECJ) in Case C-14/83Von Colson and Kamann v Land Nordrhein – Westfalen[1984] ECR 1819 which states that any award of compensation must be dissuasive to discourage future infractions of the Act.
The Court assumes that, following the principles set out in that decision, the Rights Commissioner included an amount in his award that was designed to dissuade the Respondent from future breaches of the Act.
While the Court cannot accept that the restrictions placed on the Appellant by its supervising Departments could in any circumstance justify a breach of the provisions of the Act it does take notice of the efforts the Appellant went to in order to get permission correct the infringement of the Complainants entitlements. It further notes the terms of the collective agreement reached between the social partners that will apply to all redundant public servants in future. Accordingly the Court takes the view that no purpose will be served by including a dissuasive amount in the award to the Complainant in this case.
Accordingly the Court awards the complainant compensation in the sum of €21,200 and varies the Rights Commissioner’s decision accordingly.
Determination
The Court determines that the complaint is well founded and awards the Complainant compensation in the sum of €22,100. The decision of the Rights Commissioner is varied accordingly.
The Court so determines.
Signed on behalf of the Labour Court
Brendan Hayes
25th January, 2013______________________
JMcCDeputy Chairman
NOTE
Enquiries concerning this Determination should be addressed to Jonathan McCabe, Court Secretary.