ADJUDICATION OFFICER DECISION and RECOMMENDATION

Adjudication Reference: ADJ-00005588

Representatives

David Cowhey , Solicitors.

Sophie Crosbie, IBEC Executive .

Complaints:

Act	Complaint/Dispute Reference No.	Date of Receipt
Complaint seeking adjudication by the Workplace Relations Commission under section 7 of the Terms of Employment (Information) Act, 1994	CA-00007483-001	06/10/2016
Complaint seeking adjudication by the Workplace Relations Commission under section 13 of the Industrial Relations Act, 1969	CA-00007483-002	06/10/2016
Complaint seeking adjudication by the Workplace Relations Commission under Section 8 of the Unfair Dismissals Act, 1977	CA-00007483-003	06/10/2016

Date of Adjudication Hearing: 24/02/2017

Workplace Relations Commission Adjudication Officer: Patsy Doyle

Location of Hearing: Radisson Blu Hotel Cork

Procedure:

In accordance with Section 41 of the Workplace Relations Act, 2015, Section 7 of the Terms of Employment (Information) Act, 1994, Section 13 of the Industrial Relations Acts 1969 and Section 8 of the Unfair Dismissals Acts, 1977 – 2015 following the referral of the complaints and dispute to me by the Director General, I inquired into the complaints and dispute and gave the parties an opportunity to be heard by me and to present to me any evidence relevant to the complaints and dispute

Background:

The complainant is a Croatian national who was engaged on a contract for service on March 2, 2015.He submits that he was at all times an employee .His employment was terminated on 3 June, 2016 and he is seeking redress under employment legislation for

1 Provision of a Statement of Terms of Employment.

2 Recommendations in a Trade Dispute.

3 Unfair Dismissals.

He lodged his claim on 6 October, 2016.

Both parties made extensive oral and written submissions to the hearing on 24 February, 2017.This case is associated with a range of cases involving the same respondent, currently before the WRC.

On 14 February , 2017,he complainant received a determination from the SCOPE section of Department of Social Protection , confirming that he was regarded as an employee .It went on to state that the respondent had accepted his employee status and was actively involved with DSP and Revenue to regularise the matter .

Preliminary Issue: Contract for or Contract of Service?

Complainant Position:

The complainant was hired as a Maps Data Analyst on a contract for service from his residential base of Croatia. He was in fact a Croatian national. From the beginning, March, 2, 2015, he was assigned by the respondent to work on the Croatian market at the client base. He also worked on the Canadian, United States, Australian, English, Slovenian and New Zealand markets during his employment. He worked a 40 hour week.

The complainant submitted that the day to day reality of his employment was very different to that set out in the contract for service and Contractor handbook .He submitted extensive evidence in pursuance of a determination of employment status.

The complainant quoted from an email received from the respondent dated 17 February, 2015 in introducing the background to the position he accepted:

“ …… Most test and validate software …working in English and their native language. The team currently consists of 35 languages from across Europe, Asia and South America …..We are looking for Croatian speakers to join a team that will test and evaluate (a product) .The project will commence in March, 2015 and conclude in September, 2016.The salary offered is €128 per day and relocation, where applicable “

On May 5, 2016, the complainant was invited to a meeting the following day to discuss Project Requirements. Earlier that day, he had attended an interview for a Vendor Programme Manager role with the respondent. At he meeting of May 6, his contract was terminated due to the Clients requirement for a Croatian team .He was issued with a termination letter and paid in line with the notice period outlined in his contract for service .The complainant signed the letter without legal advice and was paid up to 3, June, 2016.He was not required to work after May 5. On 21 July, 2016, the complainant wrote to the respondent submitting that he believed that work was available to him with the respondent at the time of his dismissal .He described the negative effect of his dismissal and outlined his employee status rather than self employment . He requested to be re-instated. The respondent wrote back on August 3, informing him that he was dismissed due to the Clients termination of resources required on the Project. The respondent did not re-instate his employment.

Respondent Position:

The respondent outlined that the complainant was one of 4 members of the Croatian team, hired by the respondent to work on the base of an associate company, referred to as the client .As part of the commercial agreement with the client, there was a requirement that markets were serviced by someone in that market who had lived in the market for at least 5 years .The respondent contended that these facts were known by the complainant from the outset prior to his engagement.

The respondent engaged the complainant on a contract for service of 15 months duration. In or around November 2015, there was a reduction in the work assigned to the Croatian market .Work was assigned on a daily basis by the client and the contingency for the complainant was English speaking markets such as the Canadian market .

The complainant was never assigned to the busy markets such as Germany, Austria or Switzerland.

The respondent submitted that the complainant had raised his request for employee status on January 18, 2016, was requested to email his request and did not follow up. Neither had he challenged his selection for redundancy.

The respondent expressed a tacit acceptance that the complainant was in fact an employee during the course of the hearing, but requested that the Adjudicator make a decision in that regard.

Decision on Preliminary Issue:

This case was heard on the same day as ADJ 5586. It follows a range of similar circumstances raised before the WRC.

While the SCOPE determination is informative, it is not solely determinative of employee status .At one with ADJ 5586, the respondent recorded an acceptance of the complainants employment status before SCOPE, this was not disputed at the hearing. Work was confirmed as underway in addressing the Employer and Employee PRSI payments necessary in an employment situation.

I found that the Client Company took the lead role on recruitment as demonstrated by the records of the interview process. This was conducted by the Clients manager .I was particularly struck by the reference to “The Client likes to hire “. Yet, I am satisfied that the respondent concluded all the ceremonies associated with a recruitment exercise.

I have inquired into the circumstances of the complainants working relationship with the respondent. I am satisfied that it did not bear the hallmarks of the freedoms of self employment .He was clearly under the direction and control of the respondent , as supported by direct evidence .He was not free to pursue his own interests ,or benefit from the business in any way outside his wage. It was common case that the complainant redeployed as a contingency when insufficient work on the Croatian market was available. I was persuaded by the very apparent Mutuality of Obligation demonstrated between the parties. Work meant a 40 hour week and as the respondent outlined in September 2015, “I would like to remind you of the working hours and requirements surrounding workload, we need to achieve the Irish standard working hours of 7.5 hours per day “.This was followed by an unequivocal instruction on how this was to be achieved. In my opinion, this amounted to a crystal clear instruction from an employer to an employee.

I have found that the complainant has satisfied all the tests open to me in determining employment status. Taken in tandem with the tacit acceptance of same communicated by the respondent at the hearing. I find that the complainant can safely be regarded as an employee from the outset of his employment, thus conveying on him, the locus standi to pursue his claims before the Workplace Relations Commission.

1.CA-00007483-001 Complaint under Terms of Employment (Information) Act, 1994.

Summary of Complainant’s Case:

Complainant Position :

The complainant submitted that he was entitled to be furnished with a written statement of his terms and conditions of employment reflective of his true employment status pursuant to Section 3 of the Act .He contended that the written statement of the Independent Contractor agreement did not reflect the relationship between the parties and the document should be amended pursuant to Section 7 of the Act.

Respondent Position :

The respondent rejected the claim and sought that it be dismissed. The complainant was deemed to be a self employed independent contractor and the contract issued by the respondent reflected this.

The respondent submitted that the complainant had not been disadvantaged or prejudiced due to an absence of knowledge of any terms and conditions of the contract he entered into .The terms and conditions were made known within 8 weeks, the time specified by legislation. The complainant signed and returned his agreement on contractor status on 23 February; 2015.The respondent submitted that the claim was statute barred.

Decision:

Section 7 of the Terms of Employment (Information) Act, 1994, requires that I make a decision in relation to the complaint before me.

I have considered the parties positions on this claim.

Section 1 of the Act defines an employee as having a contract of service and defines and employer as

“ employer”, in relation to an employee, means the person with whom the employee has entered into or for whom the employee works under (or, where the employment has ceased, entered into or worked under) a contract of employment subject to the qualification that the person who under a contract of employment referred to in paragraph (b) of the definition of “ contract of employment” is liable to pay the wages of the individual concerned in respect of the work or service concerned shall be deemed to be the individual’s employer.

Section3 of the Act sets out an employers statutory obligations under the Act :

Written statement of terms of employment.

— (1) An employer shall, not later than 2 months after the commencement of an employee’s employment with the employer, give or cause to be given to the employee a statement in writing containing the following particulars of the terms of the employee’s employment, that is to say—

During the period of 8 weeks into the complainants engagement , he did not fulfil the criteria of employee in possession of a contract of service in the eyes of the respondent .The company saw no reason to deviate from the self employed contract as they were not challenged on it within that time frame .

However, I have found that the complainant was miscast in that role and I have recognised his service as that of an employee.

Therefore, it must follow that I find a continuous breach of Section 3 from March 2, 2015 .The complainant was not provided with a statement in writing containing particulars of his employee status within the 2 month window.

Given that the complainant no longer works for the respondent, I find that compensation of €500 to be a just and equitable remedy to be paid by the respondent to the complainant.

Complainant Submission:

The complainant sought a recommendation that the complainant is recognised as an employee .The complainant submitted that he should be entitled to compensation for unpaid leave and pay for public holidays in like terms as if he had brought a claim under Section 23 of the Organisation of Working Time Act, 1997.

Respondent Submission:

The respondent disputed the claim .The company did not accept that the complainant should be treated as an employee from March 2, 2015.They submitted that the complainant was aware of his Independent contractor status and represented himself as such to Revenue and Social Welfare authorities . The respondent contended that the complainant could not “approbate and reprobate “as self employed and employee.

Recommendation:

Section 13 of the Industrial Relations Acts, 1969 requires that I make a recommendation in relation to the dispute.

Section 13(3) of the Act provides that an Adjudicator

Shall investigate any trade dispute referred to her under subsection (2) of this section and shall, unless before doing so the dispute is settled –

(1) Make a recommendation to the parties to the dispute setting forth her opinion on the merits of the dispute

I have heard both parties in relation to the dispute submitted. I have already decided that the complainant can be identified as an employee of the respondent from March 2015.

The complainant has been represented throughout the lifetime of his complaint before the WRC, firstly by his Union, and latterly by his Solicitor. She lodged his complaint on October 6, 2016, at one with ADJ 5586

I appreciate the obvious differential between a contract for service and contract of service in terms of annual leave and public holiday entitlement. The contract for service made no such provision, while a contract of service is firmly within the protection zone of the Organisation of Working Time Act, 1997.

I revisited the wording on the complaint form and found that the complaint was lodged in the present tense, however, by October 6, 2016; the complainant had not worked for the respondent for 4 months. A claim for annual leave and public holidays lies firmly in the jurisdiction of the presiding Act .i.e. Organisation of Working Time Act, 1997 and I am not in a position to process this aspect of the claim under the Industrial Relations Act, 1969.This aspect of the complaint cannot succeed.

In line with my responsibility for remarking on the merits of the dispute, I would urge both parties to reflect on their respective roles in this dispute. From the complainant’s perspective, I noted a delay in advancing his claim for employment status until 10 months into his engagement. He did not follow this up when requested by the respondent.

From the respondent perspective, I noted an obvious disconnect in operational knowledge on just how many markets the complainant actually worked on at the client site. A careful record of this key information may have assisted both parties in this area. I am aware of the conversion process to direct employment for a large number of former contractors on the respondent site .While this a welcome development, it is not of benefit for the complainant.

3 CA 00007483-003 Claim for Unfair Dismissal

Summary of Respondent’s Case:

The Respondent rejected the claim for Unfair Dismissal and submitted two submissions on January 20 and on the day of the hearing .In response to questions raised at the hearing, the respondent furnished additional background records surrounding the commencement of the complainant’s employment and cessation of the Croatian team .These were copied to the complainant.

The respondent outlined the circumstances of the dismissal as that of a redundancy where the entire Croatian team was dispensed with as the Client had no further nee for the team .Consideration of selection for redundancy was not a relative consideration as the entire team had been terminated and the circumstances affected everyone on the team equally .There was no application of Section 6(3) of the Act and Section 6(4) on the circumstances of dismissal being wholly or mainly attributed to redundancy prevailed for the respondent .The respondent submitted that the dismissal could not properly be regarded as unfair .

The respondent submitted that the Act does not define a statutory obligation to consult about potential redundancies .In referring to considerable body of case law , the respondent cited

JVC Europe Ltd V Jerome Panini [2011]IEHC 279

Mc Ginn V Murnaghan Bros ltd UD 13/2009, where, the employer had shown a substantial ground, namely redundancy, to justify dismissal and the claimant, of 23 years service, had failed to show that he was unfairly selected .This attracted modest compensation of €5,000.

FAI V Eoin Hand FTD/143. Labour Court .where the complainant was classified as a Consultant on a contract for service.

Mugford and Midland Bank [1997]UK EAT 760 96 2301,In this UK case , the respondent asserted that the UK Tribunal recognised that a lack of consultation about redundancy will not make a dismissal unfair if the decision maker finds that a reasonable employer would have concluded that consultation would be an utterly futile exercise in the particular circumstances .

Saul V Mahoney Manufactured Signs UD 37/2003, where employees were made redundant where an employer could not get insurance against accidents, no amount of consultation would have put the policy in place.

The respondent drew an analogy on that case with the instant case, on the announcement of cessation of the Croatian market and other markets, the respondent sought to change the mind of the associate company to save the jobs and were unsuccessful, and no amount of consultation would have altered that.

The absence of consultation was regrettable but would have been an exercise in futility and the respondent submitted that it should not be found fatal to finding of Unfair Dismissal.

The respondent contended that loss was limited to 3 months an 8 days as the complainant commenced new work in mid September, 2016 .The company had acted decently and reasonably, payments in lieu were made, appeals were offered, where appropriate.

The respondent sought an outcome for a Fair Dismissal ,in the absence of this, consideration should be given to compensation of nil or minimal proportions ,based on :

1 Short service /3 months loss.

2 Contingency work was given on foot of reduction in home markets

3 Acceptance of the payment in lieu of 4 weeks pay

4 The fact that the respondent and the complainants conduct was directly influenced by the fact that all parties were operating on the basis that these were contracts for service, rather than employment contracts.

The respondent liaison Manager gave evidence that the client had confirmed the reduction of the Croatian market on April 28, 2016. The respondent had sought to influence redeployment but the client had refused. The complainant had applied for a Vendor Project Manager position, but had been unsuccessful, and an external candidate assumed the role. The company requirement on remaining markets was that of a native speaker, who had lived in the country for 5 years .The complainant had not sought individual consultation.

The Project Manager gave evidence that he commenced with the respondent on the German/Austrian markets, having been trained on the US market. He was aware that the Croatian market did not have a high workload and he hoped that it would improve.

Complainant Position :

The complainant gave evidence that on May 5, 2016 he went home from work around 6 pm and received notification to invite him to a meeting on Project Requirements the next day ,He stated that he was shocked top lose his job. He understood that each market had rules but he was not fixed to the Croatian market and had extensive experience of the Canadian market.

He did not follow up his dismissal straightaway, things were different to Croatia. He understood that he was on a waiting list for direct employment, to be reviewed in June 2016. He began to challenge his dismissal on July 21, 2016 and was unhappy with the response from the respondent. During cross examination , he confirmed that the Croatian market was quiet ,but by the time he left, he was 30% engaged on the Croatian market and 70% on a range of other markets .He did not action a grievance. He tried for further work with the respondent, but was unsuccessful. He commences new work in November, 2016 and became a student in January, 2017.

The complainant’s representative submitted that the complainant had been denied fair procedures, in respect of his dismissal. He was not provided with any opportunity to appeal the dismissal .On 2 December, 2016, he sought access to the policies or procedures used by the respondent in the dismissal, but did not receive a response.

The complainant disputed the “native of the market country “relied on by the respondent .He stated that he was hired to provide App testing services. He had extensive knowledge of

Canadian, United States, Australian, English, New Zealand and Slovenian markets at the time of his dismissal. The complainant was not given an opportunity to raise a plea for his continuance on those markets .He had no idea the rationale behind his job loss.

The complainant submitted that the complainant should be recognised as a Fixed term worker, whose contract was terminated in advance of the parameters of Section 2(2) (b) of the Act .The complainant submitted that his client was not barred from taking his case as he did not have the benefit of legal advice at the time he signed his termination letter on May 6, 2016.

Findings and Conclusions:

I have listened to both oral presentations and have considered both extensive written submissions in this case .The complainant is the fourth member of the respondent Croatian team to appear before the WRC. The circumstances of the cases are significantly linked.

I have already established that the complainant has achieved employee status, sufficient to ground this particular course of action .I have also established that the respondent has achieved employee status in accordance with the Unfair Dismissals Act.

The burden of proof now rests with the respondent to demonstrate that the circumstances of the case meet either Section 6(1) of the Act, where substantial grounds need to be raised to justify a dismissal or where in Section 6(4) grounds are raised for the dismissal to be regarded as fair .The respondent has presented a cogent argument that a Redundancy situation prevailed for the company on foot of the Client directive on cessation of the Croatian market. I believe that all parties to the hearing accepted the facts of the slow erosion in the Croatian market, which culminated in it being withdrawn. Where the dispute arose was in regard to what happened in the immediate aftermath of that decision.

Therefore, I find that that respondent has established that a redundancy situation arose in accordance with Section 7(2) (c) of the Redundancy Payments Acts, 1967, as amended.

The fact that his employer has decided to carry on the business with fewer or no employees, whether by requiring the work for which the employee has been employed ( or had been doing before his dismissal ) –to be done by other employees or otherwise –

I have considered this claim through the prism of employment and I reviewed the five year rule determined by the respondent to be an integral component of getting a job on a native market. I fully accept that this formed a silent arrangement and understanding between the Client and the Respondent, but I cannot establish that it was raised to formality stage in either a contract for service or contract of service concerning the complainant.

Therefore, I have difficulty in being asked to consider that the complainant was treated on a par with his colleagues who all lost their jobs. While I appreciate that the respondent understood that the company had a certain lea way to terminate the self employment contracts in the manner they did. This perspective becomes vastly different when the fact of employment enters the active consideration stage.

Section 6(7) of the Act permits me to have regard for the conduct of the employer in relation to the dismissal. I found that there was insufficient attention paid to the actual markets worked on my complainant .I found that his Individual contribution to the Maps Project was not carefully analysed, discussed with him, or options put to him short of dismissal. The complainant struck me as a person who would have valued consultation.

I wish to enumerate my findings at this stage :

1 The complainant was not linked to either an implied or express term in his document of engagement, which obligated him to have lived in Croatia for 5 years prior to joining the company.

2 He was given a Generic contract.

3 His letter of termination was silent on naming any market as context or background for the dismissal. This was listed in August, and only when the complainant challenged his dismissal.

4 He demonstrated a high pattern of inter-changeability over a range of markets in his 15 month record of employment, which was not taken into consideration by the respondent.

5 The complainant was denied a place at the table to discuss his position in advance of any decision taken to dismiss him. While I appreciate that the respondent understood that they had no obligation in this regard as the Law does not require it. I find that it would have been a reasonable and respectful course of action to adopt.

6 The respondent was a clear secondary partner in the Commercial agreement, which gave rise to the project .The Client was permitted to make the decisions on tenure and job security and delegated the communication of same to the respondent .This placed the respondent in conflict with the requirements of the Unfair Dismissals Act. This was evident when the respondent changed a decision to terminate a fourth team on the project due to this risk .

7 I have found that a genuine redundancy situation prevailed in this case.

8 I have found that the complainant was entitled to be treated reasonably in terms of consultation, right to representation in accordance with S.I 146/2000, to be provided with an opportunity to input in how he saw alternatives to the decision and an opportunity to lodge an appeal. I was again struck in the circumstances of the case that employees were allowed an appeal, while contractors were not.

9 I found serious deficiencies in the respondents narrow analysis of the markets actually worked on by the complainant.

I have considered the case law relied on by the parties and again, in tandem with ADJ 5586, I find that the baseline of the complainants was markedly different in that they had the benefit, bar Hand, in having extensive employment records to ground their claims.

The complainant was an EU citizen and I found that the respondent did not act in accordance with its own “Valuing Diversity at Work Policy “in embracing the contribution that he was trying to make at the company.

To lose a job must be seen in terms of a consequent loss of livelihood. I found that the respondent did not pay sufficient attention to the complainant and his contribution to the company so as to enter a mutually respectful consultation process prior to the notification of his dismissal due to redundancy. While I appreciate that Redundancy is based on the foundation of impersonality and change, there was, in my opinion an obligation to adopt a reasonable management strategy to underpin the process. I could not establish that this occurred.

Furthermore, I am dissatisfied that the respondent did not respond to the complainant’s invocation of Section 14 of the Act on December, 2, 2016, by way of his Solicitors letter.

In these circumstances, I find that the complainant is entitled to succeed in his claim for Unfair Dismissal.

Decision:

Section 41 of the Workplace Relations Act 2015 requires that I make a decision in relation to the complaints and dispute in accordance with the relevant redress provisions under Schedule 6 of that Act. Section 8 of the Unfair Dismissals Acts, 1977 – 2015 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.

I have decided that the complainant was unfairly dismissed. I accept his evidence of loss and mitigation.

In this particular set of circumstances, I find that compensation is the only practical option open to me.

I award the sum of €4,500.00 as just and equitable compensation in accordance with Section 7 of the Act.

Dated: 04/05/2017

Workplace Relations Commission Adjudication Officer: Patsy Doyle

Key Words:

Unfair Dismissal and Contract for Service.