FTD1323

This is an appeal by St Mary’s Area Integrated Development (St Mary’s Aid) Limited (hereafter the Respondent) against the Decision of a Rights Commissioner in a claim by Ms Collette Devlin (hereafter the Claimant) under the Protection of Employees (Fixed-Term Work) Act 2003 (the Act).

The Rights Commissioner found that the Respondent had contravened sections 6(1) and 8(2) in relation to the Claimant. He awarded the Claimant compensation in the amount of €15,000.

The Facts

The material facts as admitted or as found by the Court are as follows: -

The Claimant was employed by the Respondent as its Chief Executive Officer on 28^thFebruary 2011 pursuant to a fixed-term contract for a period of 12 months. The contract stated on its face that the continuance of the employment was contingent on the continuation of funding from external sources to maintain the post. The Claimant was responsible,inter alia, for obtaining funding.

During the currency of this contract certain issues arose in relation to the Claimant management style. The Board of Management of the Respondent established a review panel to examine how the position of CEO had functioned since the Claimant was appointed. Having conducted this review a meeting was held with the Claimant at which certain requirements of the Respondent in relation to how she should perform her duties were explained.

The Claimant was informed that her employment was being continued and she would be issued with a further fixed-term contract for a period of six months on the expiry of her then current contract. It appears that the principle reason influencing the Respondent’s decision to renew the Claimant’s contract for a fixed-term was to monitor her adherence to the requirements identified in the review.

The Claimant’s first fixed-term contract expired on 24^thFebruary 2012. She was not issued with a further contract in writing following the expiry of that contract. However she remained in her position as CEO and continued to perform her duties.

On or about 4^thJuly 2012 the Respondent presented the Claimant with draft contract which was expressed to take effect from 27^thFebruary 2012 and to expire on 24^thAugust 2012.

This contract contained a provision in the following terms: -

• “The position of Chief Executive Officer (hereafter referred to as the CEO) is dependent on funding from external sources during this period. Should this funding be withdrawn at any time in whole or in part, the Board reserves the right to terminate the contract. It is hereby agreed by both parties that the withdrawal of funding from St Mary’s Aid shall constitute an objective ground justifying termination of the contract pursuant to section 9 of the Protection of Employees (Fixed-Term Work) Act 2003”

The Court is satisfied on the Respondent’s own submissions that while the objective grounds proffered in this contract for renewing the Claimant’s employment for a fixed-term and the reason for not offering her a contract of indefinite duration related exclusively to funding this did not represent the reality of the Respondent position. A second, and in the Court’s opinion, a dominant reason for the renewal of the Claimant’s employment for a fixed-term was the Respondent intention to continue monitoring her performance and to leave it free to terminate her employment if it chose to do so. This was not stated in writing as a reason for either renewing the contract for a fixed-term or for not offering the Claimant a contract of indefinite duration.

Position of the parties

Against that factual background the Claimant contends that the Respondent contravened s.8(2) of the Act. She further contends that the Respondent contravened s.6 of the Act in that she was subjected to a review process that other permanent employees were not subjected to. She also contends that other fixed-term employees were provided with contracts of indefinite duration notwithstanding the linkage between their positions and the availability of funding.

The Respondent accepts that it contravened s.8 of the Act in failing to provide the Claimant with a statement in writing setting out the objective grounds justifying her fixed-term contract at the time of the renewal of her employment in February 2012. However, the Respondent characterises this contravention as technical in nature and it contends that the Claimant was at all times aware of the fixed-term nature of her employment and the reasons why it was renewed for a fixed-term.

The Respondent denies that it contravened section 6 of the Act in the manner alleged or at all.

Conclusions of the Court

The relevant statutory provisions are to be found in s.6 and s.8 of the Act. The Act was enacted so as to transpose into domestic law the Framework Agreement on fixed-term work concluded by ETUC, UNICE and CEEP annexed to Directive No. 1999/70/EC of 28 June 1999 of the Council of the then European Communities. Consequently the provisions of the Act must be interpreted and applied to achieve the objective pursued by the Framework Agreement.

Turning first to the Framework Agreement, it is clear from Clause 1 thereof that its purpose is twofold. Firstly it is to improve the quality of fixed-term work by applying the principle of equal treatment to fixed-term workers. Secondly it is intended to provide a framework for the prevention of abuse arising from the successive use of fixed-term employment contracts.

Section 8 of the Act is one of the provisions intended to give effect to the principle that the successive use of fixed-term contracts should not be abused. The Respondent accepts that it contravened s.8 in relation to the Claimant in not providing her with a written statement of the objective grounds justifying the renewal of her employment for a fixed-term in February 2012. However, the Court cannot accept its contentions that the breach was technical in nature.

The Claimant was provided with a fixed-term contract in July 2012 which purported to apply retrospectively to February of that year. It relied upon the need for continued external funding as the objective reason for the renewing her employment for a fixed-term. However the Court is satisfied that the statement contained in the contract to that effect was misleading and did not reflect the reality of the Respondent’s position and its true purpose in renewing the Claimant’s employment for a fixed-term.

The Respondent was clearly using the fixed-term contract as a performance management tool. Rather than her employment being linked to the continuance of funding it was dependant on the Respondent’s assessment of her performance. In the Court’s view that was not an objective reason justifying the renewal of a fixed-term contract and constituted an abuse. Moreover, the Court is satisfied, as a matter of probability, that had the true purpose of the contract been disclosed the Claimant would not have signed it. At that stage she was in employment without a written contract and she could have cogently argued that her employment was pursuant to an implied contract of indefinite duration. However she executed the contract knowing that funding had been secured and in that knowledge she reasonably believed that her employment would continue. She was subsequently dismissed at the expiry of the contract notwithstanding the availability of continued funding.

In these circumstances the Respondent’s failure to disclose fully the actual grounds for the renewal of the fixed-term contract was a factor which led to the Claimant loosing employment. Hence, the contravention of s.8 of the Act was particularly serious in terms of its consequence.

Turning to the alleged contravention of s.6 of the Act, the Court has come to the conclusion that the facts relied upon in grounding this aspect of the complaint did not amount to a contravention of that section.

Determination

While the Court cannot uphold the Rights Commissioner’s decision that s.6 of the Act was breached it has found that the contravention of s.8 must be regarded as particularly aggregated. In these circumstances it believes that the overall level of compensation awarded by the Rights Commissioner remains just and equitable. Accordingly the Court awards the Claimant compensation in the amount of €15,000 for the contravention of s.8 of the Act.

The decision of the Rights Commissioner is varied in terms of this Determination.

Signed on behalf of the Labour Court



Kevin Duffy
CR______________________
17th September, 2013.Chairman



NOTE

Enquiries concerning this Determination should be addressed to Ciaran Roche, Court Secretary.