ADJUDICATION OFFICER DECISION
Adjudication Decision Reference: ADJ-00001234
Complaint(s)/Dispute(s) for Resolution:
Act | Complaint/Dispute Reference No. | Date of Receipt |
Complaint seeking adjudication by the Workplace Relations Commission under Section 8 of the Unfair Dismissals Act, 1977 | CA-00001649-001 | 22/12/2015 |
Date of Adjudication Hearing: 12/09/2016
Workplace Relations Commission Adjudication Officer: Michael McEntee
Procedure:
In accordance with Section8(1B) of the Unfair Dismissals Act, 1977, following the referral of the complaint(s)/dispute(s) to me by the Director General, I inquired into the complaint(s)/dispute(s) and gave the parties an opportunity to be heard by me and to present to me any evidence relevant to the complaint(s)/dispute(s).
Complainant’s Submission and Presentation:
I worked as a property sales negotiator for the Respondent and my duties there were as follows: Letting of Residential and Commercial Properties Valuations of Residential and Commercial properties Sale of Residential and Commercial properties I was dismissed without notice or warning on the 22nd June 2015. The specific events leading to dismissal are as follows: I left on the 1st. June 2015 for 1 week and returned to work on the 9th June 2015. The atmosphere in the house had changed dramatically from the time before I had left for holidays. I usually kept my own diary and made my own appointments, I would also answer all calls that were general inquiries and emails. I responded to a general email inquiry that was addressed to info@xx. ie which was forwarded to me to respond to. The Respondent Principal (H) would normally get all emails automatically that come in from daft.ie or myhome.ie but we later learned that the link from daft to his email had broken and all staff in the office were unaware of this, including H until an inquiry to daft.ie brought it to light that the link was broken. In the meantime, I had responded to a gentleman who had inquired by email, which was sent to info@xx.ie and addressed to Dear Sir/ Madam, inquiring of our fees to sell 2 houses that he was thinking about putting on the market. The Respondent took exception to my answering this query and was angry that he was not informed of this email. This inquiry that I had responded to was no different to any other inquiry that I had responded to in the past. I had never had to report to anyone regarding how and when I responded to an inquiry before, besides, I was sure that the actual inquiry had gone to the Respondent also. The Respondent challenged me on my response to the email, saying that he should have been informed of the inquiry and basically said that I was trying to garner clients for my own benefit in order to increase my commission. He then said that he was of the understanding that I was only paid a commission on "take on" fees, if the client came directly through me and were friends and family. I must point out, that this was never our agreement and I had always been paid a commission, without question, on any new business I brought in. I disputed this with the Respondent, stating that this was never our understanding and that there was precedence to prove that this was never the case. He then said that he did not want to compete with me for business under his own roof and went on to offer me a basic wage of €15,000 per annum in lieu of him not paying me the "take on" portion of my commission. I told him that I would have to think about his offer and get back to him. The next time we spoke about his offer was Tuesday the 22nd June 2015, approximately 5 working days later from our initial conversation. I entered the Respondent’s office at noon and was asked to take a seat. I said that I would like to accept his offer of €15,000 in lieu of a take on commission and he responded, without hesitation, that the offer he had made the previous week, he had changed his mind and that he didn't think that he could trust me again in light of "the email" that I had responded to. He also said that our arrangement was not suitable from a tax point of view and that he didn't want to "get caught" by revenue. He said that my termination was with immediate effect and the explanation that he would give to anyone as to the reason I was no longer there would be that " his son was taking a more serious interest in the business". I left the office at 12.15pm. The Complainant in her legal submissions challenged the alleged Contractor /Self Employment status of her employment. She maintained that she was “an employee” within the meaning of the Act and that her claim was valid to be heard under the terms of the UD Act, 1977. |
Respondent’s Submission and Presentation:
The Respondent submitted three principal grounds for the rebuttal of the claim.
Firstly the Claim is out of time, having being lodged outside of the time frame allowed.
The dismissal took place on the 22 June 2015 and the claim was receive in the WRC on the 22nd December 2015. The Respondent maintained that the 6 month period ended on the 21st December.
The claim submission period can not contain any element of notice as firstly the complaint was not an employee and not withstanding was dismissed for Gross Misconduct which under Section 8 of the Minimum Notice and Terms of Employment Act, 1973 which allows for Dismissal without notice in cases of Gross Misconduct.
Secondly the Complainant was not an employee but a self employed person providing a Contract for Services to the Respondent.
Evidence was presented showing the original Agreement between the parties, the agreement that the Claimant would be paid commission and fees by way of invoice submitted. The claim forms and payment records attesting to this arrangement were presented. No holiday pay or other statutory Public Holidays etc. were ever paid to the Complainant. She clearly held herself out as a Contractor on a Contract for Services basis.
Thirdly the Complainant was, in any event, dismissed fairly for Gross Misconduct
Evidence was presented that the Complainant had acted in a manner designed to garner business / commissions etc. to her own personal account to the detriment of the Respondent. An Email incident of the 15th June 2015 (involving a Client inquiry) was offered in evidence as to the Complainant’s self serving behaviour and the breach of trust with her employer.
Decision:
Section 8(1B) of the Unfair Dismissals Act, 1977 requires that I make a decision in relation to the unfair dismissal claim consisting of a grant of redress in accordance with section 7 of the 1977 Act.
Issues for Decision:
Question One
Was the Complainant an “employee” sufficient under the Act to qualify to make a valid claim?
If Yes to the above
Question Two
Was the claim in time?
Question Three
Was the Dismissal fair?
Were all correct procedures followed as set out in the UD Act 1977 and the LRC Code of practice SI 146 of 2000?
Legislation involved and requirements of legislation
Unfair Dismissals Act, 1977 and the Labour Relations Code of Practice on Discipline and Grievance SI 146 of 2000. Code of Practice for Determining Employment or Self –Employment Status of Individuals –Employment Status Group 2007.
The requirements for Fair Procedures and Natural Justice at all times.
Decision:
In the order set out above
Was the Claimant an “Employee”?
The Law involved:
The law involved here is extensive and many precedents can be quoted. The legal submissions from the parties were extensive. However and following the Edwards J High Court Case [2008] IEHC 216 and Meenan Employment Law 2014 text book as a guide I adopted the following basic principles
Each case has to run on its own facts and a number of Legal tests have to be looked at as an aid, not a definitive statement, in deciding the issue – namely the Control, Integration, Entrepreneurial, Mutuality of Obligation and the Mixed Test.
Basic pertinent facts of the case
The Complainant began employment in March 2012 – a handwritten agreement /contract of on or the 22nd March 2012 about was produced in evidence. It stated that the status of the Complainant would be that of a “Sole Trader”.
On questioning from the Adjudicator as to why this model was used the Responded pointed to the depth of the property recession at that time , Estate Agencies were not hiring staff on the normal employment basis and the model used here ,of the employee being a self employed Sole Trader , was then the norm.
The Complainant commenced employment and was responsible for all her own affairs, taxation holidays etc. She invoiced the Respondent from “Complainant Name Property Consultants”. She provided her own motor car and paid for all petrol and maintenance herself. She received a mobile phone to the value of €32:00 per month.
She was registered for a required licence with the Property Services Regulatory Authority and listed as an “Employee” for the years 2012, 2013, 2014 and 2015. On the Regulatory Authority records produced in evidence she was listed as an “Employee” on the 5th July 2016. Copies of her statutory Licence ID cards from 2013 and 2014 were produced I evidence – both listed her as an “employee” of Respondent Real Estate.
She was covered on the Respondent Professional Indemnity Insurance and the Respondent paid her contributions to the Property Services Compensation Fund as her employer. Her business cards –supplied in evidence described her as a Property Negotiator. Likewise she appeared on the Respondents Website/Facebook Page as a member of staff. However there was a high degree of flexibility allowed to the Complainant in her actual hours of work which it was stated was a common feature of the work practices in Estate Agencies of the nature of the Respondent.
The Commission and Fee structure was agreed in advance – hand written note –the “Contract” between the parties on or about the 22nd March 2012.
Consideration
In Para 2.7 of the Respondents submission it was stated
“Whether on Facebook, business cards, email account or any other publicized area, it would look ridiculous, in the Respondent’s view, to purchasers or vendors if the Complainant were described as a contractor. It would also of course cause some significant concerns for clients regarding the integrity of the Respondents’ business and the impression may therefore have been given that the Complaint was indeed an employee”
Taken with the Regulatory Licence proofs referred to above I found this a compelling statement. The Complainant required a Licence to operate legally and her licence clearly stated that she was an Employee. The Complainant referenced and quoted Sections 4 and 5 of the Property Services (Regulation) Act 2011 in support of this legal position.
Section 4 (2)
A licensee who is licensed to provide a property service as an employee of a property service employer in his or her capacity as such employee is only entitled to provide such service on behalf of any licensee - :
She was based in the Respondent’s office , albeit with flexible hours of attendance linked to the clients focus nature of the business, had an e-mail address at the Respondents, followed upon sales calls received in the office and operated it appeared in evidence under the general direction of the Respondent.
It was interesting that one of the grounds advance for her Dismissal was that the Complainant was not effectively following Directions from the Respondent in regard to how sales inquiries were treated. This evidenced a degree of Control as would be required in the Control test. The Mutuality of Obligation test was also relevant. The Respondent attracted the business and the Complainant worked on it. The Respondent did not supply any business materials and had no Entrepreneurial interest in the business save to earn commissions – the Entrepreneurial Test. There was no evidence that she also, in parallel, ran another Estate Agency business. This would have posed a significant problem for her with the Regulatory Authority.
In addition to the Regulatory issue and taking the Tests listed above in particular the Control Test , the Integration Test and the Mutuality of Obligation test I have to find that the Complainant was effectively an Employee of the Respondent sufficient to quality for inclusion under the UD Act 1977.
Question Two
Was the claim in Time?
The claim was receive in the WRC on the 22nd December exactly six months after the Dismissal. In addition allowing for the fact that I found the Complainant was an “Employee” and would have been due minimum notice I find the claim in time.
Question Three
Was there an Unfair Dismissal?
The Respondent advanced considerable written and oral evidence in regard to issues of Complaint with the Complainant. There was strong evidence for at least a full inquiry/investigation
However leaving these to one side for the moment I refer to Paragraphs 2.14 and 2.15 of the Respondents submission
“2.15 Respondent A discussed the matter with his brother and Co Director Respondent B. They concluded that the requisite trust between the parties no longer existed and that the contract for services with the Complaint should be terminated.”
This meeting took place in advance of the meeting with the Complainant on the 22nd June 2015. There was clearly a pre mediated decision and the opportunity to offer rebuttal arguments, to review the evidence gathered by the Respondent, to participate in an investigation of the issues and seek an Independent review of the decision were not afforded to the Complainant.
Procedurally the Dismissal has to be found unfair.
Redress
In considering this issue I have to consider if the Complainant contributed in some way to the Dismissal decision. The evidence presented by the Respondent clearly indicated that there were reasonable grounds for at the least an Investigation. The Complaint offered explanations at the hearing for most of these matters. In the absence of a proper unbiased Investigation having been carried out I was not in a position to give an opinion on this Respondent evidence.
Having considered the case fully and reviewed the evidence presented both oral and written I award the Complainant 6 months average earnings. The evidence given indicated gross earnings of € 31,647 for 2014 and € 36,291 for 2015. Taking an average of the two figures the award is €34,000/2 giving a final figure of €17,000.
In making this award I noted that the Complainant has gone into business for herself since the dismissal but her earnings in a start up scenario were not such as to merit having a major impact on the award. Her future earnings potential would appear to be good as her excellent business ability was recognised by all parties.
As the Complainant was an “employee” Statutory Minimum Notice is to be paid in addition to this figure.
As the relationship between the parties has now irretrievably broken down Reinstatement or Reengagement was not a viable Redress option.