DWT1722

In its unamended form, the Act did not provide that periods of absence from employment on sick leave were reckonable for the purpose of accruing annual leave. In Cases C-520/06 and C-350/06Stringer and others v. HM Revenue and Customs sub nomCommissioners of Inland Revenue v. Ainsworth and othersSchultz-Hoff v. Deutsche Rentenversicherung Bund[2009] IRLR 214 the Court of Justice of the European Union (CJEU) held that Article 7 of Directive 2003/88/EC concerning certain aspects of the organisation of working time (The Directive), properly construed, allowed for the accrual of annual leave during such periods of absence. The Act was subsequently amended by section 86 of the Workplace Relations Act 2015 so as to provide that periods of certified sick leave are reckonable for the purpose of calculating an entitlement to annual leave. The amendment further provided that the entitlement created endured for a period of 15 months from the close of the leave year to which it relates. That amendment took effect from 1^stAugust 2015.

The Complainant was employed on a part-time basis with the Respondent. In February 2013 she commenced a period of certified sick absence and continued on sick leave until she resigned from her employment on 27^thJanuary 2016. Upon the termination of her employment the Respondent paid the Complainant 7 ½ days holiday pay. The Respondent contends that the entitlement to accrue annual leave in respect of periods of sick leave only applies to periods after the commencement of the amendment on 1^stAugust 2015. Based on that understanding, the Respondent calculated the Complainant’s accrued annual leave while on sick leave from 1^stAugust 2015 until 27^thJanuary 2016. The Complainant contends that the Act in its amended form, if properly construed, entitled her a payment in respect of 30 days annual leave on the termination of her employment.


Summary of the Complainant’s Claim

Mr Richard Grogan, Solicitor, Richard Grogan & Associates, Solicitors, on behalf of the Complainant submitted that theComplainant’s annual leave which accrued prior to the cessation of her employment ought to have been calculated with due regard to the 1997 Act, as amended by section 86(1) of the Workplace Relations Act. He said that the provision was operative at the time the Complainant’s employment terminated and accordingly she was entitled to the benefit of that section in respect of her circumstances and the criteria laid out in section 86(1). Section 86(1) has been in effect since lst August 2015. It was submitted that the Respondent has erred in the manner in which it applied the 1997 Act, as amended, when calculating the Complainant’s leave.

Mr Grogan submitted that the Court ought to interpret the 1997 Act in a manner compatible with the Directive. Reliance in this regard was placed on the judgment of the CJEUin Case-441/l4Dansk Industri vEstate of Karsten Eigil Rasmussen ECLI:EU:C:2016:278. That case involved a request for a preliminary ruling pursuant to Article 267 TFEU, in a case involving age discrimination law in Denmark. The referring court sought guidance from the CJEU on the circumstances in which provisions of Union law prohibiting discrimination on grounds of age can be relied upon by domestic courts to interpret or disapply domestic law. According to Mr Grogan, the Court decided that, if the Danish provisions could not be interpreted compatibly with the general principle prohibiting discrimination on grounds of age, the Danish courts were bound to disapply the provisions so as to give effect to the general principle. The Court held at paras. 31-35:-

• “It follows that, in applying national law, national courts called upon to interpret that law are required to consider the whole body of rules of law and to apply methods of interpretation that are recognised by those rules in order to interpret it, so far as possible, in the light of the wording and the purpose of the directive concerned in order to achieve the result sought by the directive and consequently comply with the third paragraph of Article288TFEU (see, inter alia, judgments in Pfeiffer and Others, C-397/01 to C- 403/01EU:C:2004:584, paragraphs113and114,and K�c�kdeveci, C -555/07 EU:C:2010:21, paragraph 48).
  
  It is true that the Court has stated that this principle of interpreting national law in conformity with EU law has certain limits. Thus, the obligation for a national court to refer to EU law when interpreting and applying the relevant rules of domestic law is limited by general principles of law and cannot serve as the basis for an interpretation of national law contra legem (see judgments in Impact, C-268/06, EU:C:2008:223, paragraph 100; Dominguez, C-282/10, EU:C:2012:33, paragraph 25; and Association de mediation sociale, C-176/12, EU:C:2014:2, paragraph 39).
  
  It should be noted in that connection that the requirement to interpret national law in conformity with EU law entails the obligation for national courts to change its established case-law, where necessary, if it is based on an interpretation of national law that is incompatible with the objectives of a directive (see, to that effect, judgment in Centrosteel, C-456/98, EU:C:2000:402, paragraph 17).
  
  Accordingly, the national court cannot validly claim in the main proceedings that it is impossible for it to interpret the national provision at issue in a manner that is consistent with EU law by mere reason of the fact that it has consistently interpreted that provision in a manner that is incompatible with EU law.
  
  
  That point having been made clear, it should be added that even if a national court seised of a dispute that calls into question the general principle prohibiting discrimination on grounds of age, as given concrete expression in Directive 2000/78, does in fact find it impossible to arrive at an interpretation of national law that is consistent with the directive, it is nonetheless under an obligation to provide, within the limits of its jurisdiction, the legal protection which individuals derive from EU law and to ensure the full effectiveness of that law, disapplying if need be any provision of national legislation contrary to that principle (judgment in K�c�kdeveci, C-555/07, C -555/07 EU:C:2010:21, paragraph 51).”

• "[It is] perfectly clear that the Court is under an obligation to interpret national law, so far as possible, in the light of the Community provisions it is designed to implement. The national court is subject to the obligation of 'conforming interpretation' as the [European Court of Justice] ... described it in its judgment in ... Pupino".

• "[t]here is no principle of European law which allows an administrative body or a court of limited jurisdiction to exceed its own authority in order to achieve a result, whereby it is of the view that European legislation has not been properly implemented".

• "principle of effectiveness requires that those individuals should also be able to seek before the same courts the protection of the rights which they can derive directly from the directive itself ... the obligation to divide their action into two separate claims and to bring the claim based directly on the directive before an ordinary court leads to procedural complications liable to render excessively difficult the exercise of those rights conferred on the parties by Community law.
  
  If the referring court were to find such an infringement of the principle of effectiveness, it would be for that court to interpret the domestic jurisdictional rules in such a way that, wherever possible, they contribute to the attainment of the objective of ensuring effective judicial protection of an individual's rights under Community
  law. "

• " ... it should be borne in mind that even a clear, precise and unconditional provision of a directive seeking to confer rights or impose obligations on individuals cannot of itself apply in proceedings exclusively between private parties",

• "The alternative solution ofextending a power, which would not otherwise arise, to a Tribunal, to disapply national legislation is wholly contrary to the national legal order and, certainly as a matter of national law, would not represent an appropriate solution to this problem. "

• " ... as a matter of national law, a person or body exercising statutory power (not being a court established under the Constitution) does not have jurisdiction to commence a process where the only positive conclusion would involve the setting aside or disapplying a measure of legislation, whether primary or secondary. On that basis I have concluded that the Tribunal would not, as a matter of national law, have jurisdiction to entertain the complaints of the notice parties in this case, for the only lawful conclusion in favour of those notice parties would require the disapplication of the Regulations"

• "It is clear that the obligation on domestic courts and tribunals to interpret national law in conformity with a Directive applies 'as far as possible '. That is to say" it cannot serve as a basis for allinterpretation of national law contra legem. As was pointed out by the CJEU in Dominguez v Centre Informatique du Centre Ouest Atlantique, a conforming interpretation can only be arrived at by taking the whole body of domestic law into consideration and applying the interpretative methods recognised by domestic law, with a view to ensuring that the Directive in question is fully effective and that an outcome consistent with the objective pursued by the Directive is achieved.
  
  In this case the submissions received by the Court do not identify what, if any, interpretative methods known to Irish law could be employed by the Court so as to produce the result contended for by the Appellant and avoid a construction contra legem. Nor do the submissions identify the appropriate test to delineate the point of departure between a permissible conforming interpretation and an impermissible contra legem interpretation."

The Law

The issue arising for consideration relates to the extent to which the amendments to the Organisation of Working Time Act 1997 made by section 86(1) of the Workplace Relations Act 2015 (the amending Act) can apply to the calculation of annual leave entitlements in respect of periods prior to the commencement of the amending Act.




Retrospectivity of Legislation

There is a presumption in common law that legislation is intended to operate prospectively only. This point was conveniently summarised in the Determination of the Court inKirwan v Department of Justice Equality and Law Reform[2008] 19 ELR 89. Here the Court stated as follows: -

Rule against retrospectivity

• 
  It is clear beyond argument that the Act cannot be applied retrospectively and this is correctly acknowledged by counsel for the claimant. Legislation is deemed to be retrospective in effect when it takes away or impairs any vested right acquired under existing law or creates a new obligation, or imposes a new duty or attaches a new disability in respect of transactions or considerations alreadypast Hamilton v Hamilton; Dunne v Hamilton[1982] I.R. 466.
  
  However past events can be taken into account in applying a statute without infringing the rule against retrospectivity. This was noted by Barron J. in O'H v O'H [1990] 2 I.R. 558, as follows:
  • “In considering whether a statute should be construed retrospectively, a distinction is to be drawn between applying the new law to past events and taking past events into account. To do the latter is not to apply the Act retrospectively”

• • This statement of the law was adopted by the Supreme Court in Dublin City Council v Fennell [2005] 2 I.R. 604. The point was further illustrated by Kearns J in that case by reference to the decision of the Court of Appeal for England and Wales in Antonelli v Secretary of State for Trade and Industry [1998] Q.B. 948. Here the court had to consider the application of a provision of the Estate Agents Act 1979 in light of the rule against retrospectivity. The provision at issue authorised the making of an order prohibiting a person from engaging in estate agency work if he appeared unfit to practice on various grounds, including that he had a previous conviction for an offence involving fraud or dishonesty or violence. It was held that a conviction incurred before the commencement of the Act could be taken into account as it indicated unfitness just as much as a conviction incurred after the commencement would.

• • The Provisions of the Act Under Consideration

• • (1A) For the purposes of this section, a day that an employee was absent from work due to illness shall, if the employee provided to his or her employer a certificate of a registered medical practitioner in respect of that illness, be deemed to be a day on which the employee was–
    
    at his or her place of work or at his or her employer's disposal, and
    
    (b) carrying on or performing the activities or duties of his or her work.

• • European Law Consideration

• • 102. In the present case, since, according to the information given in the order for reference, domestic law appears to include a rule that precludes the retrospective application of legislation unless there is a clear and unambiguous indication to the contrary, it is for the referring court to ascertain whether there is a provision in that legislation, in particular in the 2003 Act, which contains such an indication capable of giving retrospective effect to s.6 of the 2003 Act.
    
    103. In the absence of such a provision, Community law — in particular the requirement for national law to be interpreted in conformity with Community law — cannot be interpreted as requiring the referring court to give s.6 of the 2003 Act retrospective effect to the date by which Directive 1999/70 should have been transposed, as the referring court would otherwise be constrained to interpret national law contra legem.
    
    104. In the light of the foregoing, the answer to the fourth question must be that, in so far as the applicable national law contains a rule that precludes the retrospective application of legislation unless there is a clear and unambiguous indication to the contrary, a national court hearing a claim based on an infringement of a provision of national legislation transposing Directive 1999/70 is required, under Community law, to give that provision retrospective effect to the date by which that directive should have been transposed only if that national legislation includes an indication of that nature capable of giving that provision retrospective effect

• • Court’s Jurisdiction

• • “The Decision inMinister for Justice, Equality and Law Reform v The Equality Tribunalraises the question of whether this Court has jurisdiction to apply the doctrine of conforming interpretation at all. It should be noted, however, that the correct application of that doctrine does not require the setting aside of a provision of national law. Rather, it involves the correct application of national law by interpreting that law in light of the wording and purpose of a Directive upon which that law is based. It is founded in part on the presumption that the national legislature intended to transpose a Directive faithfully. If this Court is circumscribed in applying the law of the European Union in deciding a case within its jurisdiction that could offend against the principals of effectiveness and equivalence.”

• • Disapplying National Law

• • “In order to answer that question, it is appropriate first of all to note that the source of the general principle prohibiting discrimination on grounds of age, as given concrete expression by Directive 2000/78, is to be found, as is clear from recitals 1 and 4 of the directive, in various international instruments and in the constitutional traditions common to the Member States (see judgments in Mangold, C-144/04, EU:C:2005:709, paragraph 74, and K�c�kdeveci, C-555/07, EU:C:2010:21, paragraphs 20 and 21). It is also apparent from the Court’s case-law that that principle, now enshrined in Article 21 of the Charter of Fundamental Rights of the European Union, must be regarded as ageneral principle of EU law(see judgments in Mangold, C-144/04, EU:C:2005:709, paragraph 75, and K�c�kdeveci, C-555/07, EU:C:2010:21, paragraph 21).”[emphasis added]

• • “Moreover, it is apparent from paragraph 47 of the judgment inAssociation de médiation sociale,(C-176/12, EU:C:2014:2) that the principle prohibiting discrimination on grounds of age confers on private persons an individual right which they may invoke as such and which, even in disputes between private persons, requires the national courts to disapply national provisions that do not comply with that principle.”

• • 75The principle of non-discrimination on grounds of age must thus be regarded as a general principle of Community law. Where national rules fall within the scope of Community law, which is the case with Paragraph 14(3) of the TzBfG, as amended by the Law of 2002, as being a measure implementing Directive 1999/70 (see also, in this respect, paragraphs 51 and 64 above), and reference is made to the Court for a preliminary ruling, the Court must provide all the criteria of interpretation needed by the national court to determine whether those rules are compatible with such a principle (Case C-442/00 Rodríguez Caballero [2002] ECR I-11915, paragraphs 30 to 32).
    
    76 Consequently, observance of the general principle of equal treatment, in particular in respect of age, cannot as such be conditional upon the expiry of the period allowed the Member States for the transposition of a directive intended to lay down a general framework for combating discrimination on the grounds of age, in particular so far as the organisation of appropriate legal remedies, the burden of proof, protection against victimisation, social dialogue, affirmative action and other specific measures to implement such a directive are concerned.
    
    77 In those circumstances it is the responsibility of the national court, hearing a dispute involving the principle of non-discrimination in respect of age, to provide, in a case within its jurisdiction, the legal protection which individuals derive from the rules of Community law and to ensure that those rules are fully effective, setting aside any provision of national law which may conflict with that law (see, to that effect, Case 106/77 Simmenthal [1978] ECR 629, paragraph 21, and Case C-347/96 Solred [1998]ECR I-937, paragraph 30).

• • “In this connection, the facts of the case may be distinguished from those which gave rise to K�c�kdeveci in so far as the principle of non-discrimination on grounds of age at issue in that case, laid down in Article 21(1) of the Charter, is sufficient in itself to confer on individuals an individual right which they may invoke as such.”

• • “In the first place, that the Council of the European Union adopted Directive 2000/78 on the basis of Article 13 EC, and the Court has held that that directive does not itself lay down the principle of equal treatment in the field of employment and occupation, which derives from various international instruments and from the constitutional traditions common to the Member States, but has the sole purpose of laying down, in that field, a general framework for combating discrimination on various grounds including age (see Mangold, paragraph 74).
    
    In that context, the Court has acknowledged the existence of a principle of non-discrimination on grounds of age which must be regarded as a general principle of European Union law (see, to that effect, Mangold, paragraph 75). Directive 2000/78 gives specific expression to that principle (see, by analogy, Case 43/75 Defrenne [1976] ECR 455, paragraph 54).”
    

• • “The need to ensure the full effectiveness of the principle of non-discrimination on grounds of age, as given expression in Directive 2000/78, means that the national court, faced with a national provision falling within the scope of European Union law which it considers to be incompatible with that principle, and which cannot be interpreted in conformity with that principle, must decline to apply that provision, without being either compelled to make or prevented from making a reference to the Court for a preliminary ruling before doing so.”

• • Indirect effect

• • “[I]n applying national law, whether the provisions in question were adopted before or after the Directive, the national Court called upon to interpret it is required to do so, as far as possible, in light of the wording and purpose of the Directive in order to produce the result pursued by the latter”

• • 19. Before I look at these provisions in detail I should say a word about the relationship between Community law and national law. As a matter of general principle there is no doubt but that Community law constitutes an autonomous system of law and that in all respects it is a system which is superior to any domestic system of a member state. In any case of conflict, inconsistency, or discord, national measures must give way. This means that where conflict exists:
    
    i) Community law takes precedence over domestic law;
    
    ii) Community law renders automatically inapplicable any relevant national provision;
    
    iii) Community law prohibits the adoption of any new measures which are incompatible with it; and finally,
    
    iv) a national court, in order to give full effect to this principle, must set aside conflicting provisions, whether passed before or after the Community measure.
    
    20. These principles are non-controversial and well established (see Stato v Simmenthal [1978] ECR 629). These provisions have been supplemented by what might be described as subsidiary rules, established by the ECJ over time. One such rule emerged from the Marleasing case (Marleasing SA v La Comercial Internacional de Alimentacion SA [1991] 1 ECR 4135) and is now known as the “Marleasing principle” or the “principle of conforming interpretation”. This means that a national court has an obligation to interpret domestic legislation “so far as possible” in a manner both compatible with and in conformity to European law. This phrase “so far as possible” has been the subject matter of several decisions.Broadly speaking this interpretive method cannot be stretched to a point which involves a departure from the fundamental or cardinal feature of the provision in question. Subject however to this qualification, the Marleasing principle pervades all pieces of domestic law which necessarily are or ought to be influenced by Community law (see Commissioners for Her Majesty's Revenue and Customs v IDT Card Services Ireland Ltd[2006] EWCA Civ 29and Pfeiffer v Deutsches Rotes Kreuz [2005] ICR 1307).[emphasis added]

• • “The obligation to interpret domestic legislation to give effect to EU law is not limited to resolving ambiguities, i.e. where the words of the domestic statute admit of more than one “possible” meaning. The court may add words to a statute so as to depart from the unambiguous meaning that the legislation would otherwise bear. The real question is whether the departure is compatible with the underlying thrust of the legislation, or consistent with the scheme of the legislation or its general principles. The interpolated words have to go “with the grain” of the legislation.”
    

Signed on behalf of the Labour Court



Caroline Jenkinson
CR______________________
30th August, 2017Deputy Chairman



NOTE

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