EMPLOYMENT APPEALS TRIBUNAL
CLAIM OF: CASE NO.
Dermot Comerford -claimant UD466/2014
MN195/2014
WT70/2014
against
Health Service Executive -respondent
under
UNFAIR DISMISSALS ACTS 1977 TO 2007
ORGANISATION OF WORKING TIME ACT 1997
MINIMUM NOTICE AND TERMS OF EMPLOYMENT ACTS, 1973 TO 2005
I certify that the Tribunal
(Division of Tribunal)
Chairman: Mr C. Corcoran B.L.
Members: Mr C. Lucey
Ms. E. Brezina
heard this claim at Dublin on 11th June 2015 and 18th August 2015
Representation:
Claimant: Ms. Cathy McGrady B.L. instructed by FM Kelly & Company, Solicitors, 69 Church Street, Skerries, Co. Dublin
Respondent: Arthur Cox, Solicitors, Arthur Cox Building, Earlsfort Terrace, Dublin 2
Preliminary Issue:
The respondent operates an early intervention centre for young people directed to the centre from the Courts. It was set up by virtue of the Child and Family Agency Act 2013 which established TUSLA. It was commonly known as the Ballydowd Special Care Unit. It is a high security centre for children aged 12 to 17 years with serious emotional and behavioural difficulties. It was not a normal or typical workplace in that the work environment was one of tension and high risk for example if a window was broken or other damage caused to property in general it would have to be repaired almost immediately because this inevitably created a serious risk or of self-harm or serious injury to the occupants. The claimant performed maintenance services at the centre from 2006. It was the respondent’s case that the claimant was not an employee. His contract for service was terminated due to his failure to produce evidence of tax compliance and demonstrate possession of public liability insurance.
The Acting Deputy Director of Operations (with responsibility for maintenance) gave evidence to the Tribunal. The claimant’s role was the general upkeep of the centre which was required on a daily basis. Other services were also contracted to the centre such as chefs and cleaners. The Acting Deputy Director linked in with the claimant on damage caused to the centre. The claimant worked at the centre from 8am to 4pm, Monday to Friday but the witness was unaware how this arrangement came into being but this could be varied by the claimant and was not always adhered to. The claimant was provided with a maintenance list from the Acting Deputy Director who signed off on whether certain maintenance work was of a high or low priority. However, he did not instruct the claimant as to how to carry out the work. The respondent supplied and paid for the paint that was required and other general heavier hardware equipment. The claimant provided some other lighter equipment and tools necessary to do his work.
The claimant submitted a daily invoice of €220 and an on-call rate of €75 was also agreed. The Acting Deputy Director believed the claimant’s invoice was processed by the accounts payable department rather than payroll. A sample of the invoice submitted by the claimant was opened to the Tribunal. The monthly accounts fluctuated depending on the number of days the claimant worked and it was not ideal if he could not attend on a daily basis as the respondent needed to look for other supports.
It was the respondent’s case that it could not decline a request from the claimant for time off. The claimant was not paid for sick leave nor did he provide the respondent with medical certificates in times of illness. The agreed protocol was that the claimant would contact line management in the event of his not attending work on any given day. In the event the respondent needed to respond to emergency situations the back up maintenance department was contacted. The claimant was not paid for holidays but there was a need to inform the respondent when he was taking holidays as a matter of courtesy, and the nature of the work.
From August 2012 meetings were held in relation to public liability insurance. The claimant was informed that it was required but he stated he could not afford it. There were follow up meetings throughout 2013 but the claimant still had not sourced public liability insurance.
Due to this Mr. F, the Acting Director of the Special Care Unit, together with HR and the Finance Officer made the decision to terminate the relationship with the claimant on 15th November 2013. The matter was also referred to the Scope section of the Department of Social Protection who found that the claimant was a self-employed individual.
Mr. F gave evidence. The Centre which comprises several residential units provides secure residential accommodation for young people with emotional and behavioural difficulties. A gym and a school are also situated on the campus. The claimant had originally worked for a company who provided services to the respondent company. When the respondent dispensed with the services of that provider the claimant commenced providing general routine maintenance services to the respondent in November 2006. He was not furnished with a contract of employment. The claimant signed in and signed out when he finished work.
He received induction training and was trained on fire safety. He carried out regular fire safety checks and was a member of the health and safety committee. The health and safety committee met every quarter. The purpose of him attending the health and safety committee meeting was to provide information to specific questions asked and the nature of his work in that area. Priority was at all times given to tasks to be carried out in the residential units. The respondent had at all times to ensure that the claimant was kept on task. Occasionally he provided a service to the local school but was not paid by the respondent for this work.
The witness’s understanding was that the claimant’s role was that of an independent contractor and not an employee. The claimant was never subjected to disciplinary action during his tenure.
Mr. L, General Manager of the Finance Department gave evidence. “Relevant Contract Tax” known as the R.C.T (is a tax deduction system, for subcontractors in certain cases). Up to 31/12/07 the claimant charged VAT. This new regime was introduced in 2008, i.e. the Relevant Contract Tax. The claimant then submitted invoices and the respondent deducted the relevant contract tax from the invoices and paid it over to Revenue. Revenue instructs the respondent on what percentage to apply, whether 0%, 20% or 35%. The respondent then informs the contractor accordingly.
It was the claimant’s evidence that he was initially employed by Mr. M who provided contracting maintenance services to the centre. Due to an issue with Mr. M the claimant was approached by the director of the centre to take over the work. The claimant requested a contract of employment twice but was told he could not be provided with one. His standard working hours were 8 am to 4 pm. On occasion he left early and availed of time in lieu with the permission of Mr. T. There was an initial agreement that he would be paid €5,000 per month but later this was altered to show a daily breakdown instead. It was the claimant’s case that he was paid the same sum per month regardless of whether there was a bank holiday in the month or if he had missed a day. He was not subject to public service cuts but was requested to take a 10% pay cut.
The powered equipment he used was provided by the respondent as well as all other heavy duty equipment. It was very rare that the claimant would need reimbursement for an item as generally he ordered any materials needed through the respondent’s purchase order system. If something arose causing him to deviate from the checklist he needed approval from the Acting Deputy Director.
The respondent did not raise the issue of public liability insurance with the claimant until the latter part of 2012 and he queried why it was suddenly required. He had never been asked to provide public liability insurance before as everything pointed to the fact that he was an employee. On another occasion he completed a Revenue checklist with Mr. F and it indicated that he was an employee.
Mr F told the claimant that he would have to provide evidence that he was self- employed. The claimant spoke with the Revenue Commissioners who advised him the matter would have to be referred. The claimant heard nothing further until he was asked to meet with Mr. F again. He subsequently received a letter informing him that as he had not provided documents as requested by the respondent, his services were no longer required.
During cross-examination the claimant accepted that he was previously subject to PAYE tax system and that employees do not register for VAT. The claimant submitted tax clearance certificates and engaged the services of an accountant from 2006.
Following the termination of his employment he returned on four occasions to his place of work, once to collect his tools and three times to collect firewood he had stored in a shed. After the termination of his employment he signed on with the Department of Social Protection and was told he was not due payments. However, some weeks later he began receiving €41.00 per week.
Some time later the claimant met an Inspector from the Department of Social Protection in relation to whether he was an employee or self-employed. The meeting lasted approximately one hour.
The claimant did not appeal the decision of the Deciding Officer of the Scope Section of the Department of Social Protection until 10th August 2015 as he placed more significant importance on it for the purpose of his case before the Tribunal.
The claimant’s accountant, Mr. K gave evidence. He registered the claimant for VAT. In his opinion the claimant was an employee. He had sight of the Revenue Code of Practice for determining employment or self employment status of individuals and accepted the claimant had completed this document. He was not involved in the Scope investigation of the Department of Social Protection. On 10th August 2015 the claimant instructed Mr. K to appeal the decision of the Deciding Officer dated 10th September 2014.
Determination:
Having heard the evidence in this case both oral and written and having observed the demeanour of the witnesses under examination in chief, cross-examination and re-examination, and submissions received from both parties, the following salient points in this matter are of particular note together with other general circumstances.
The claimant worked generally from 8 a.m. to 4 p.m., from Monday to Friday, although these could be varied and were from time to time, e.g. he worked a lot of half days in 2012 and took a lot of Mondays off in 2013.
The claimant was not subject to HSE control or direction. He was engaged/hired by the Ballydowd Centre and while he reported to Ballydowd management as to what maintenance work he had carried out he was not instructed on how it had to be done.
He worked generally for the same hirer, but he did work on the adjacent school for which he was remunerated separately for by the school. This was rare. However his circumstances were such that he was not precluded from working for other hirers.
He had no public liability insurance and indeed was not required to have any public liability insurance from circa 2006 up to circa 2012.
He signed in and signed out for work. This was stated by the respondent to be necessary as a security measure because of the prevailing work environment. It was also submitted that employees signed in this book. It was separately submitted that he signed the same book as other non-employees such as chef and cleaners.
He received induction training and was trained in fire safety.
He was a member of the health and safety committee which normally consisted of employees, but it was argued that his peculiar role necessitated this.
It was submitted by the claimant that according to Revenue he was an employee on the basis of a Revenue document produced “which ticked all the boxes” identifiable with the status of employee and it was alleged that Mr. F. a witness for the Respondent filled it in on the basis of information provided by the claimant and in his presence. However this was challenged by the Respondent on the basis that Mr. F. denied all knowledge of this, and stated that he had never seen it before There was no signature on this document.
He had no contract of employment even though he had requested one, twice. This was disputed. There was no formal written contract governing the agreement or the type of relationship between the parties.
He submitted invoices for payment and was on a daily rate of 220 euro and a call out rate of 75 euro. The daily rate and call-out allowance were set by the claimant himself. These rates did not change despite the fact that all employees of the respondent were subject to unilateral pay cuts.
He was registered for V.A.T. and had a V.A.T. number. There were no pay-slips.
He was included in a new system introduced by Revenue circa 2008 for contractors/sub-contractors, where relevant contract tax was deducted from the invoices by the Respondent and paid over to Revenue. Revenue would instruct the Respondent on what percentage to apply, whether 0% or 20% or 35%, and the contractor/sub-contractor would be informed. His treatment by revenue was that of a self- employed person, and the levying of R.C.T. was consistent with independent contractor status, and he did not object to this at the time.
He was required to provide annual Tax Clearance Certificates.
He claimed expenses in the invoices submitted from time to time.
He was not paid for days off or while on holidays, nor was he required to produce medical certificates while on sick leave.
He did not require permission to take time off but he was required to notify management personnel as a matter of courtesy, so that a replacement could be organised, especially because of the nature of the work, the prevailing work environment, and security issues.
The respondent provided the heavier equipment for the job and the claimant provided his own lighter equipment, and tools.
He was not subject to public service cuts but was requested to take a 10% cut. He refused but he offered to do less work in lieu. This was not acceptable because of the prevailing dangerous work environment.
A Deciding Officer from the Scope Section of the Department of Social Protection had decided that he was not an employee. This decision was not appealed by the claimant until almost a year later, despite the fact that there was a time limit for appeal of 21 days. It was submitted that the reason for not appealing promptly, was because he placed more significant importance on it for the purpose of his case before the Tribunal.
Following the termination of his employment he signed on with the Department of Social Protection and was informed that he was not due any payments. However some weeks later he began receiving 41 euro per week.
He paid Class S level Social Welfare insurance, which is self-employment designation.
It was not a normal or typical workplace in that the occupants were final referrals from the High Court and had severe emotional and behavioural problems e.g. if a pane of glass was broken or other damage caused to property creating a hazard, or possible or potential hazard it would have to be repaired almost immediately as there would be a real risk that one or more residents could injure themselves. There needed to be constant supervision of the occupants. The work environment was one of tension and high risk.
Counsel for the claimant indicated that she was not challenging the manner in which the claimant was paid.
In all of these cases as enunciated by the Courts and Tribunals, there seems to be one abiding thread permeating through each of them, namely, that each case depends on its own particular circumstance prevailing at the relevant time. This was succinctly and specifically referred to by Keane J. in the case of Henry Denny & Sons (Ireland) Limited V Minister for Social Welfare, Supreme Court when he stated inter alia that “each case must be considered in the light of its particular facts and of the general principles which the courts have developed” and approved by Edwards J. in the case of The Minister for Agriculture and Food V Barry and Others 2008, and further approved on appeal to the Supreme Court in the same case.
Having regard to the salient points of fact already referred to in this case and mindful of the various procedures, principles and tests laid down by the Courts in these matters, but without testing the facts of the case “in a rigid formulaic way”, we find that the claimant was hired on a contract for services basis. In making its determination the Tribunal is mindful of the following specific sentiments and guidelines as expressed in case law namely:
Barry and Others V Minister for Agriculture and Food, Supreme Court, delivered on the 16/7/15: In that case –
Charlton J. recognised that a self-employed agreement relationship could turn over a period of time into an employment agreement.
Charlton J. reiterated and confirmed that each case must be considered on its own facts.
In these cases having regard to the statutory provisions involved it is for the Employment Appeals Tribunal alone to decide on employment status.
Laffoy J. in agreeing with Charlton J. stated that “no doubt the Tribunal will be assisted in that task by the guidance given in the judgement (previous High Court decision) of Edwards J.”
Laffoy J. Further stated as follows- “Notwithstanding that, in making the determination which it (the tribunal), will be under a legal duty to make, the Tribunal will have to assess the evidence as to the work relationship of the Applicants with the Minister adduced by the parties before it by reference to the legal principles which have been established by the courts over the years in order to make a finding as to whether or not each of the Applicants was an employee of the Minister. No doubt the Tribunal will be assisted in that task by the guidance given in the judgement of Edwards J. However it is for the Tribunal to determine on the basis of the evidence before it as whether, in accordance with the established principles, each of the Applicants was or was not an employee of the Minister prior to October 2004”.
In the High Court decision of Minister for Agriculture and Food v Barry 2009 Edwards J. was critical of the decision of Employment Appeals Tribunal to limit the issue before it to a binary question. He was of the view that there was no single composite test for determining whether an employment relationship existed. He also noted that the so-called “enterprise test” which involved looking at the contract as a whole and asking the question whether a person was in business on his or her own account could not in the circumstances be determinative. While under the circumstances it could be legitimately applied as an aid to the drawing of appropriate inferences, it was incorrect to apply it in a formulaic way. It was also incorrect to assert that the questions of initiation and control were to be regarded merely as elements to be taken into account, and that all potential aids to the drawing of appropriate inferences stood in their own stead. The general principles emanating from case law such as “enterprise”, “control” “integration”, and “mutuality of obligation”, did not represent an exhaustive list. He also indicated that it was unhelpful to speak of “tests”, as no one test could constitute a measure or yardstick of a universal application that could be relied upon to deliver a definitive result.
In case of Hayes v Business & Shopping Guide Ltd.(U.D. 177/2010).
The Tribunal considered the employment status of a sales agent. In concluding that the sales agent was a self –employed contractor, the Tribunal had focused on the fact that he had no signed written contract. He paid his own tax and P.R.S.I. contributions. He submitted invoices in his own name. He never claimed sick pay. Medical certificates were never sought from him. Two accountants and a tax inspector determined that he was correctly classified as a self-employed person at the time.
In case of Mc Cotter v Quinn Insurance Ltd. U.D. 242/2011.
The claimant worked for an insurance company as a regional claims manager. In considering the employment status, it was noted that the claimant invoiced the company for his services. He did not receive holiday or sick pay. He made his own tax returns as a self-employed person. He did not receive pay increases when employees did. He had no control over the volume of work he had to perform. He could not delegate his work. He was required to be available for work during the hours of 9-00a.m.and 5-30p.m. The tribunal endorsed Edwards J’s approach in the High Court case of Barry, (recently endorsed by the Supreme Court), and emphasised that it is not the sum total of factors but the overall effect that is important in determining employment status. The Tribunal also stated in making its decision that the relationship between the parties was an unusual one in some respects, and ultimately held that the claimant was engaged as a self-employed person.
As already stated the Tribunal finds that the claimant was hired on a contract for services basis. Consequently the Tribunal, has no jurisdiction to hear this claim under the Unfair Dismissals Acts 1977-2007, The Organisation of Working Time Act 1997, and The Minimum Notice and Terms of Employment Acts 1973 to 2005.
Sealed with the Seal of the
Employment Appeals Tribunal
This ________________________
(Sgd.) ________________________
(CHAIRMAN)