ADJ-00012480

Complainant

Respondent

Anonymised Parties

An employee

An employer

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-00016458-001

20/12/2017

The Complainant was employed by the Respondent and was dismissed on 31/03/2017. There is no start date but it is believed that she had commenced employment in or about 2004.

The complainant is the estranged wife of the Respondent Managing Director.

Preliminary Issue – 1 -   Out of Time

It was submitted by the Respondent’s representative that the Complainant is out of time for submitting her claim. Section 41(8) of the Unfair Dismissals Act 1977 empowers an Adjudication Officer to extend the initial six months, if he or she is satisfied that the failure to present the complaint within the initial period ‘was due to reasonable cause’.

The Court stated “The established test for deciding if an extension should be granted for reasonable cause shown is that formulated by the Labour Court Determination DWT 0338 Cementation Skanska v Carroll. Here the test was set out in the following term;

It is the Court’s view that in considering if reasonable cause exists it is or the Claimant to show that there are reasons which both explain the delay and afford an excuse for the delay. The explanation must be reasonable, that is to say it must make sense, be agreeable to reason and not be irrational or absurd. In the context of which the expression reasonable cause appears in the statute it suggests an objective standard, but it must be applied to the facts and circumstances known to the Claimant at the material time. The Claimant’s failure to present the claim within the six month time limit must have been due to the reasonable cause relied on. Hence there must be a causal link between the circumstances cited and the delay and the Claimant should satisfy the Court, as a matter of probability that had those circumstances had not been present he would have initiated the claim on time”.

The test formulated in Cementation Skanska v Carroll draws heavily on the decision of the High Court in Donal O’Donnell and Catherine O’Donnell v Dunlaoghaire Corporation 1991 ILRM30. Here Costello J (as he was then) stated as follows; “The phrase “good reasons” is one of wide import which it would be futile to attempt to define precisely. However, in considering whether or not there are good reasons for extending the time I think it is clear that the test must be an objective one and the Court should not extend the time merely because an aggrieved Plaintiff believed that he or she were justified in delaying the institution of proceedings. What the Plaintiff has to show (and I think the onus under Order 84 Rule 21 is on the Plaintiff) is that there are reasons which both explain the delay and afford a justifiable excuse for the delay.

It is clear from the authorities that the test places the onus on the Applicant on an extension of time to identify the reason for the delay and to establish that the reason relied upon provides a justifiable excuse for the actual delay. Secondly, the onus is on the Applicant to establish a causal link between the reason proffered for the delay and his or her failure to present the claim in time. Thirdly, the Court must be satisfied, as a matter of probability, that the complaint would have presented in time were it not for the intervention of the factors relied upon as constituting reasonable cause. It is the actual delay that must be explained and justified. Hence, if the factors relied upon to explain the delay ceased to operate before the complaint was presented, that may undermine a complaint that those factors were the actual cause of the delay. Finally, while the established test imposes a relatively low threshold of reasonableness on an Applicant, there is some limitation on the range of issues which can be taken into account”.

Preliminary Issue 2 – Employment status.

The Complainant was not an employee of the Respondent. She received a salary each month but carried out no duties to earn such a salary and never attended at the office.

Primary Issue – Unfair Dismissal.

In reply to direct questions from the Respondent’s representatives the Respondent Managing Director gave the following replies:

1.     The Complainant was never an employee of the company.

2.     The Complainant was never given any duties to carry out.

3.     The Complainant was not my PA (personal assistant).

4.     The Complainant never worked outside the home.

5.     The Complainant was paid monthly after my salary was split in two.

6.     When the new CFO (chief financial officer) commenced early in 2017 he advised that we should stop this arrangement.

7.     The Complainant was never issued with a contract by the Respondent company.

8.     When we regularised the payments a P45 was sent to the Complainant by the CFO.

The Complainant informed the hearing that she was always an employee and her duties were that of a PA (personal assistant) to the Respondent Managing Director.

When asked to explain her duties she stated that she carried out various projects and that these included the decoration of properties owned by the Respondent company. When pushed to elaborate on this she identified two properties, an apartment in Templebar and a house in Portugal.

The Complainant informed the hearing that it was very difficult to describe the duties of a PA and accepted that to a very great extent her time was her own and that she had no fixed hours of work.

As the Adjudication Officer in this case I have found it quite difficult to arrive at a conclusion.

The Complainant was set up as an employee of the Respondent company and received a salary each month paid to her bank account. The wages system generated a wage slip for her and these were kept by the Respondent Managing Director. I heard from the Respondent Managing Director that the salary paid to the Complainant was the amount that his salary was reduced by. Reasoning for such an arrangement appear to be that it was more tax efficient. The Complainant was issued with a P60 each year and these were produced at the hearing.

A letter dated 20/12/2017 from the Revenue Commissioners addressed to the Complainant confirms that she was in employment with different companies, all from within the Respondent group of companies, during 2007,2013,2014,2015,2016 and 2017. This letter also provides details of what taxation was paid by the Complainant.

When the Respondent company hired a new Chief Financial Officer in early 2017 he advised that this arrangement had to cease and issued a P45 to the Complainant by email. At this point the salary of the Respondent Managing Director was restored to the pre-arrangement level.

In relation to the questions put to the Complainant regarding her duties as a PA her answers were quite weak and this would suggest that she was not busy at all in this position.

Out of Time.

I have considered the arguments from the Respondent representative, heard from the Complainant and read the letter from the Residential Treatment and Rehabilitation Centre where she spent 12 weeks undergoing an intensive programme. I have made the decision that reasonable cause i.e. her physical and psychological health at the time prevented her from lodging a complaint within six months and therefore I will extend the time limit to 12 months thus allowing the claim to be heard.

Employment Status.

As stated at hearing I will address the employment status as part of the substantive issue.

Substantive Issue – Unfair Dismissal.

It suited the Respondent company or an individual in the Respondent company to make the Complainant an employee. It appears the motive for such was to avail of more favourable taxation arrangements, this was quite clearly stated at the hearing.

With the arrival of a new CFO early in 2017 came the advice that this arrangement should cease and the Complainant received her P45 a short time later. No explanation or discussion appear to have taken place with the Complainant.

What is a P45?

I have studied the definition of P45 and note the following:

Form P45 is a (3-part) physical certificate or documentation given to you by your employer, when you leave employment, to indicate that they have correctly deducted tax (PAYE)PRSI & USC from your pay in accordance with the instructions provided by Revenue. (source – leading payroll service company).

A P45 is a statement of your employee’s pay and deductions for the year up to the date they leaveyour employment. (source – www.revenue.ie)work

There can be no doubt that the Complainant in this instant case was indeed an employee of the Respondent company.

Section 6, subsection (6) of the Unfair Dismissals Act 1977 reads as follows;

‘In determining for the purposes of this Act whether the dismissal of an employee was an unfair dismissal or not, it shall be for the employer to show that the dismissal resulted wholly or mainly from one or more of the matters specified in subsection (4) of this section or that there were other substantial grounds justifying the dismissal’

Section 6, subsection (4) reads as follows;

‘Without prejudice to the generality of subsection (1) of this section, the dismissal of an employee shall be deemed, for the purpose of this Act, not to be an unfair dismissal, if it results wholly or mainly from one or more of the following:

a)     The capability, competence or qualifications of the employee for performing work of the kind which he was employed to do so,

b)     The conduct of the employee

c)      The redundancy of the employee, and

d)     The employee being unable to work or continue to work in the position which he held without contravention (by him or by his employer) of a duty or restriction imposed by or under any status or instrument made under statute’.

The dismissal of the Complainant in this instant case was an unfair dismissal.

Redress.

The Complainant informed the hearing that she had looked at the possibility of training courses and had made some enquiries with a local clothes shop.

By her own admission she is not medically fit enough to return to the workplace but hopes this situation will improve in time.

Where a figure is being computed for immediate loss of earnings and the Complainant is ill for the relevant period his /her loss of earnings may be assessed as nil. In this instant case whilst the Complainant is not fit for work she is not in receipt of any state benefits.

In cases such as this the maximum redress for unfair dismissal is outlined in section 7 (C) (ii) ‘if the employee incurred no such financial loss, payment to the employee by the employer of such compensation (if any, but not exceeding in amount 4 weeks remuneration in respect of the employment from which he was dismissed calculated as aforesaid) as is just and equitable having regard to all the circumstances.

From figures on the complaint form I calculate 4 weeks earnings as €2,692.31.

I find in favour of the Complainant and order the Respondent to pay the sum of €2,692.31 to the Complainant within 20 working days from the date of this decision.

Unfair Dismissal