Act

Complaint Reference No.

Date of Receipt

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

CA-00015658-001

08/11/2017

Complaint seeking adjudication by the Workplace Relations Commission under section 27 of the Organisation of Working Time Act, 1997

CA-00015659-001

08/11/2017

The complainant was a cleaner who commenced her employment with the respondent on September 15th 2014.

She worked thirty hours per week and was paid approximately €10.00 per hour.

The complainant says that she was made redundant by the respondent.

She received correspondence from the respondent on April 27th 2017 which indicated that her employment was being transferred and that from then on she would be directly employed by the organisation for whom the respondent had previously provided contract services.

This letter from the respondent referred to this being a transfer under the TUPE regulations.

A further letter issued on May 21st to say that the termination of the respondent‘s contract was to be delayed until June 21st.

Then she received a letter on June 12th placing her on temporary lay off although she was also told that her employment had transferred to the new employer.

She describes this as a redundancy situation and on September 26th solicitors acting on her behalf wrote arguing that the complainant’s contract had been wrongly terminated and that salary remained due to her.

Following further correspondence from the solicitor, the respondent offered the complainant work on the basis of twenty hours per week.

She says she is entitled to claim redundancy as she was on lay off or short term working for more than four weeks and that the purported transfer of undertaking was a ruse to sever the contractual relationship with her.

She also claims payment for annual leave.

The respondent was advised by its client, (a large public sector organisation) that its contract with was being terminated with effect from May 22nd 2017.

It confirms that this was delayed until June 11th 2017. It then began the process of transferring its staff to the (soon to be) former client, including the complainant.

The client was provided with a list of the names of its employees and advised that, in its opinion, the Transfer regulations applied. The client disputed this in correspondence.

Despite that it met with the respondent employees prior to the transfer and offered then jobs and provided training.

It is true that some of the respondent’s employees (including the complainant, but at a later stage,) sought their P45 largely because they were left in a position of uncertainty about what was happening.

In fact, the complainant did transfer to the new employer without any interruption in her employment.

The respondent says that the transfer involved an ‘economic entity’ which brings it within the ambit of the TUPE and those regulations apply.

And, the new employer did in fact take the respondent‘s former employees without, in the complainant’s case any interruption in her employment. The respondent is at a loss to know why it, the new employer, disputes the application of the Regulations, unless it was to deny its former employees credit for their continuous service.

Despite this the complainant’s contract of employment with the respondent was not actually terminated and she was placed on a temporary lay off from June 12th 2017 (the date when she commenced employment with the new employer).

The claim for annual leave payment is not disputed.

In respect of the claim for redundancy, the respondent in this case defends its position on the basis that there was an immediate, uninterrupted transfer of all its previous employees to the new employment.

The contract it previously held with the new employer to provide cleaning services was terminated and the cleaning contract was brought ‘in-house’.

It appears that al the respondent’s employees were not only employed by the new employer but on improved conditions of employment and with a requirement to work additional hours.

The purported ‘transferee’ was not at the hearing (and not on notice of it) and what gave rise to its view of the status of the transfer was not available for consideration. The new employer has, according to submissions at the hearing and correspondence opened in evidence, disputed that the move represented a transfer under the TUPE Regulations, or was a transfer at all.

Whether it was or not a transfer falling under the Regulations is not the issue in this hearing, as it has not been referred under those Regulations.

The relevant complaint has been made under the redundancy legislation. The respondent devoted most of its written submission to the applicability of the Regulations and to its view that they apply in this case.

That must remain a matter to be resolved between the current complainant and her new employer, as to what is the correct interpretation of the nature of transfer which took place.

However, the respondent did notify its employees and the new employer on a number of occasions that it saw the move as a transfer under the Regulations. There was correspondence between the parties (former and new employer) on the due diligence process.

It must be said that this is not a matter to be decided unilaterally by a transferee. A transfer falling under the ambit of the Regulations is, as it is often described, a matter of ‘operation of law’ and not one for either the current respondent alone to decide, nor indeed the new employer in this case.

The new employer seeking to terminate a contract of one of those employees (such as the complainant) in the circumstances which applied here must be aware that there is a possibility of employees coming within the ambit of the TUPE Regulations and seeking a remedy accordingly .

It does not reflect well on any of the parties to the transaction that the precise status of the change was not fully clarified for the benefit of all, in particular the complainant and her colleagues but again that is to stray outside the terms of the current complaint.

Nonetheless, a simple disavowal of the applicability of the TUPE Regulations (by the new employer) will not suffice to render them inapplicable.

It had one further consequence which also muddies the waters.

The respondent on the one hand ‘presumed’ that a transfer was underway following its loss of the contract but equally issued the lay-off notice, which it described as standard practise. For some reason, given that it was aware that the complainant was working for the new employer, and following correspondence from the complainant’s solicitor and the threat of WRC proceedings it offered the complainant employment in November 2017, but on the basis of reduced hours.

This mess all stems from the abject failure of the parties to properly address the situation arising from the loss of the respondent’s contract and before the change took place.

But what is not in issue is that some kind of transfer, however one wishes to describe it, did take place. The complainant submitted that any alleged Transfer of Undertaking was ‘a sham and/or ruse’ to allow the respondent to sever the contractual relationship between itself and the complainant.

In a letter from the complainant’s solicitor on September 26th 2017 something similar is stated where they say that the respondent had created ‘a spurious and specious suggestion’ that the complainant’s employment was taken over by the new employer.

The basis for its claim is a letter from a senior manager dated September 21st in the new employer stating that the complainant was ‘working as a temporary staff member following an interview process’ and ‘she was previously working here under [the respondent] but did not transfer over to us from [the respondent].

The respondent lost its contract to provide services to its former client and, now, the new employer.

The complainant moved immediately from the employment of the current respondent on improved terms and continued to do precisely the same work as she had done before, and did so voluntarily, it would appear.

There are two critical requirements for a redundancy.

One is that the requirement for the work undertaken by a complainant be substantially changed or no longer required (and the grounds for doing so are outlined in section 7(2) of the Redundancy Payments Act).

The second is that there be a dismissal.

Where an employee gains employment with a new employer immediately on being made redundant this will not affect entitlement to a redundancy payment.

The situation here is different in that the complainant continued to carry out her previous role in every respect. I regard the September 21st letter from the new employer on which the complainant’s solicitor relied and in which it sought to deny the fact of the transfer as disingenuous at best.

What exactly did happen? The attempt to suggest that the complainant was somehow in the nature of a new employee when the letter itself confirms that she had been working there defies common sense.

On June 11th, 2017, the complainant carried out a range of functions in the respondent’s employment indirectly for her current employer on their premises. On June 12th, the following day, she was carrying out the same range of functions on the same premises directly for her new employer, and did so voluntarily.

If this is not a transfer in its ordinary meaning, then what is it?

I make no finding as to whether it comes within the jurisdiction of the TUPE regulations as that is not before me. But it must be a matter of surprise that the complainant did not opt to challenge the new employer’s statement given the history of the matter. In particular, it is inexplicable that the assertion that the complainant was in a ‘temporary’ role did not trigger a reaction from the complainant.

However, it will not appear to the ordinary eye as a dismissal, or termination whatever else it may be, and this is a vital requirement for a redundancy. There was a continuity one does not find in the situation referred to above where an employee is successful in gaining employment between the notice of redundancy and its taking effect.

In this case the complainant continued to do exactly the same work in the same place, albeit it for a slightly higher wage.

Accordingly, I find there was no redundancy and the complainant is not entitled to a redundancy payment.

Her complaint under the Organisation of Working Time Act, 1997 was not disputed and it is upheld. The complainant was paid €301.50 and is entitled to four weeks payment in lieu of annual leave; a total of €1206.00

For the reasons set out above I do not uphold complaint CA-00015658-001 and it is dismissed.

I uphold complaint CA-00015658-002 and award the complainant payment of twenty days’ pay in lieu of annual leave not given in the amount of €1,206.00.