ADJ-00007877

Complainant

Respondent

Anonymised Parties

A Receptionist

A GP

Act

Complaint/Dispute Reference No.

Date of Receipt

Complaint seeking adjudication by the Workplace Relations Commission under Section 39 of the Redundancy Payments Act, 1967

CA-00010423-001

27/03/2017

The complainant commenced employment with the GP on 30^th September 1996 employed as a Receptionist working 40 hours per week over 5 days in a Gaeltacht area. The GP retired on 28^th February 2017. The complainant is seeking redundancy on the basis that she was made redundant by the respondent. The respondent disputes this and claims that as the complainant commenced employment with another GP the following day that she does not have a valid claim due to the European Communities (Protection of Employees on Transfer of Undertakings Regulations 2003).

The complainant commenced employment on 30^th September 1996 working as a Receptionist and was advised by letter from the respondent on 30^th January 2017 that the respondent was retiring from her practice owing to ill-health and ‘transferring’ the practice to another GP (Dr X) effective 1^st March 2017. It was detailed in this letter that Dr X would be taking over the practice and would “hopefully” continue the complainant’s employment.

The complainant was interviewed for the role with Dr X on 30^th January 2017 followed by another discussion on 1^st Feb and received a job offer on 7^th Feb with a start date of 1^st March 2017 on a higher rate of pa. The respondent ceased working in the practice on Tuesday 28^th February and Dr X opened on 1^st March 2017.   There was an exchange of correspondence between the complainant’s representative and the respondent regarding redundancy but the respondent refused it on the basis that TUPE applied.

The complainant received a letter from the Dr X on 5^th June 2017 which referenced that “TUPE legislation does not apply” and that Dr X had received clarification on the matter from a number of sources including the HSE and Dr X enclosed a copy of a letter from the HSE which detailed that albeit they would not comment on an individual case, “statutory contracts cannot be transferred and thereby fall outside the Transfer of Undertakings Protection of Employees (TUPE) Regulations”. There was further exchange of correspondence and Dr X replied on 19^th June 2017 detailing that “it is absolutely clear to me that I have no liability in respect of any prior employment”.

The complainant detailed that the work she does with Dr X is different to the work she did with the respondent as Dr X does his own typing and that she is more involved with the financial side of the practice than she would have done in her previous role.

It was argued that similar to a ‘barrister’ the GP cannot sell their GMS contract when they retire and that where a GP is allocated a GMS contract, they are held to it personally and it is deemed a new arrangement. Case law referenced in support of their claim for redundancy and disputing that TUPE applied included Ryan v Matt O’Flaherty [2004] 15 ELR 180, A worker V An employer (ADJ 1863), A worker v GP PracticeADJ 1653, and Employee v Employer (RP2631/2011).

 Preliminary Issue:

The respondent raised a preliminary issue, namely that the complainant does not have a valid claim under the Redundancy Payment Act due to the operation of the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003. It was argued that as a transfer of undertaking had arisen, in effect, there was no termination and that no redundancy took place.

The respondent advised that she started the practice in 1982 catering for private patients in a Gaeltacht area. She rented private premises and fitted it out at her own expenses. In 1987 she secured a GMS number from the then Health Board and did not get appointed to a GMS list but had to build the list slowly to complement her private practice.

She advised her employees early in 2016 that she was unwell and would require surgery and that there were difficulties securing a locum to cover for her. Her health failed to improve and she was eventually left with no alternative but to retire. She had intended to retire in Oct/Nov 2016 and wrote to the HSE and was advised that the GMS scheme would be advertised. She expected that the practice would just close down completely due to the difficulties with securing a GP who could speak Irish. However, in January 2017 Dr X entered into an agreement with her to take over the practice, including the private client list, equipment, lease and employees if he wished.

The complainant advised the respondent that she wished to stay on with Dr X and the respondent recommended the complainant to Dr X. The respondent issued a letter on 30^th January 2017 which she advised gave notice to the complainant and advised the complainant of the transfer.     The practice closed on a Tuesday evening and reopened on Wed 1^st March with the same employees including the complainant.

It was advised by the Respondent that the employment continued with no break in service. The respondent could only afford to pay the complainant’s salary owing to her private client practice. She advised also that despite cuts to GMS payments in 2008 and 2011, she did not impose those cuts on the complainant. She advised that income from GMS contract v Private Practice was 60:40.

It was also detailed that a transfer of undertakings can take place for any number of reasons once there is a transfer of an economic entity which in this instant case was the respondent’s retirement and therefore TUPE regulations apply. As the complainant suffered no monetary loss and no loss of any kind and as the complainant has over emphasised the significance of the GMS contract, it is not a similar situation to cases cited.   It differs from the cases cited as: in Ryan v O’Flaherty there was a termination of employment and there is no mention of private client list; in ADJ 1653 the case was not defended by the respondent; in ADJ1863 there was no consideration of private client list and the respondent failed to attend. It was argued that for redundancy to exist there must be a termination of employment which in this instant case, there was not and therefore no redundancy took place.

Cases cited in support of the respondent, claiming that TUPE applied and rejecting the redundancy claims, included Fairhurts Ward Abbotts Ireland v Boest Building Ltd & Ors [2004 EWCA Civ 83] and 89 Abler & Others v Sodexho MM Catering GmbH [2006] 2 CMLR 4 which detailed that it was an entity capable of retaining its identity after it has been transferred or even partly retaining its identify.

The preliminary issue raised by the respondent, in relation to whether a termination took place or whether there was in fact a transfer of undertaking, requires a full investigation of all the evidence.

Many facts of the case were undisputed in that the complainant was employed as a Receptionist with the respondent. The Respondent underwent surgery and there were difficulties securing a locum partly because the GP practice is located in an Irish speaking area.   Unfortunately, the respondent had to make a decision to retire owing to ill-health and she advised the HSE of her decision and Dr X secured the GMS contract. Whether the complainant was advised that TUPE regulations would apply or not is unclear and the respondent admitted in her evidence to “poor choice of words” when she detailed that “hopefully” Dr X would continue with the complainant’s employment. Regardless, discussions took place between the complainant and Dr X regarding her employment with him. The complainant advised that Dr X made it clear, and it is evident from their correspondence, that if she secured employment with him there would be no continuity of service.

Following the hearing, details of the job interviews with Dr X were forwarded as were details from the respondent’s accountant regarding fees secured from GMS contract - neither the respondent nor the complainant replied to each other’s correspondence. Information provided by the respondent details sources of her income in 2015 and 2016 and it would appear that approximately 70-80% of fees during this time were secured from GMS contract. While the respondent detailed in her direct evidence that the GMS contract was less than this, but even taking into consideration that the private practice may have been greater in previous years, it is clear that the GMS contract has been a significant source of income for the respondent and more than that secured from the private practice.

When the respondent announced her retirement, the GMS contract was re-advertised by the HSE.   In effect her GMS contract was to be terminated and when a new GMS contract was issued it was very clearly unconnected with and has no similarity to the previous contract.   This has been clearly set out in Employee v EmployerRP2631/2011 which found that a “transfer of undertaking did not occur”. It is also set out in the same decision that no liabilities under “the former contract carried over to the new contract”. This was expanded in UD354/03 whereby the Tribunal details that “the practice secretary is in ease of the GP rather than of assistance to the Health Board. The GMS contract will have to be implemented by the GP whether or not he retains a practice secretary” and that, in effect, the complainant is an employee of the GP practice not the GMS contract. Thus the “entity capable of retaining its identity after it has been transferred” or even partly retaining its identify, which the respondent cited in relation to the Fairhurts Ward Abbotts Ireland v Boest Building Ltd & Ors [2004 EWCA Civ 83] and 89 Abler & Others v Sodexho MM Catering GmbH [2006] 2 CMLR 4, does not apply in this instant case and as detailed in O’Donnell v FeerickUD77/2004/RP48/2004 the “employment ceased as when (sic) the GMS contract ceased”.

So with respect to the preliminary issue, raised by the respondent detailing that there was no termination, and that the TUPE regulations apply, I find that the complainant’s employment was terminated on 28^th February 2017 owing to the retirement of the respondent and that TUPE regulations do not apply. To determine whether the termination meets the definition of redundancy under Section 7(2) of the Redundancy Payment Act 1967, Section 7(1) of the Redundancy Payments Acts provides that:

(1) An employee, if he is dismissed by his employer by reason of redundancy or is laid off or kept on short-time for the minimum period, shall, subject to this Act, be entitled to the payment of moneys which shall be known (and are in this Act referred to) as redundancy payment provided—

( a) he has been employed for the requisite period, and

( b) he was an employed contributor in employment which was insurable for all benefits under the Social Welfare Acts, 1952 to 1966, immediately before the date of the termination of his employment, or had ceased to be ordinarily employed in employment which was so insurable in the period of four years ending on that date.

Furthermore, Section (2) goes on to state:

“ For the purposes of subsection (1), an employee who is dismissed shall be taken to be dismissed by reason of redundancy if for one or more reasons not related to the employee concerned the dismissal is attributable wholly or mainly to—

( a) the fact that his employer has ceased, or intends to cease, to carry on the business for the purposes of which the employee was employed by him, or has ceased or intends to cease, to carry on that business in the place where the employee was so employed, or

(b) the fact that the requirements of that business for employees to carry out work of a particular kind in the place where he was so employed have ceased or diminished or are expected to cease or diminish, or

(c) 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 had been employed (or had been doing before his dismissal) to be done by other employees or otherwise, or

On that basis, as the complainant’s position ceased when the respondent retired, the circumstances meet the definition of redundancy under Section 7(2) of the Redundancy Payment Act 1967.

In respect of the redundancy payment claim, based on the evidence and documentation submitted by the complainant, I find that the appeal under the Redundancy Payments Acts 1967 to 2007 succeeds and award the complainant a redundancy lump sum based on the following;

Date of Commencement:        30^th September 1996

Date of Termination:               28 February 2017

Gross Weekly Pay:                  €600.00

This award is subject to the complainant having been in insurable employment for the relevant period under the Social Welfare Acts. A ceiling of €600.00 applies to any payments from the Social Insurance Fund.

Redundancy, TUPE, GP Practice, GMS Contract, Receptionist