ADJUDICATION OFFICER DECISION

Adjudication Reference: ADJ-00017340

Parties:

Complaints:

Date of Adjudication Hearing: 11/02/2019

Workplace Relations Commission Adjudication Officer: Eugene Hanly

Procedure:

In accordance with Section 41 of the Workplace Relations Act, 2015 following the referral of the complaints to me by the Director General, I inquired into the complaints and gave the parties an opportunity to be heard by me and to present to me any evidence relevant to the complaints.

Background:

The Respondent stated that this was not an employer / employee relationship and the Workplace Relations Commission does not have jurisdiction to deal with this case.

The complaint under the Redundancy Payments Act CA 22415-004 was withdrawn.

Preliminary Point Employer/Employee Relationship

Respondent

The Respondent operates a concessions company with a number of well-established contracts with the capital’s principal music venues. The company only employs two people directly, all others form part of a pool of freelance causal workers who are available to work both here and abroad. The Complainant and the Respondent entered into a contract for service in or around 2002 and he was engaged as a merchandise vendor on a casual basis as and when shows and he were available. The Complainant did not carry out work on a continuous basis. He was abroad in Australia for a period of time and he acted as a courier for a period of time. This was not an employer-employee relationship, it lacked control, integration and mutuality of obligation. The Complainant was not integral to the business. The business always managed each show themselves or hired an experienced manager. In 2018 the Respondent managed in excess of 180 shows and the Complainant worked 56 of them. The Complainant suited himself and was only willing to work when it suited him. He did not make himself available for the biggest venue in the country and the most difficult one. The legal position is that in order for there to be a contract of employment there must be mutuality of obligation: an obligation on the part of the employer to provide work and an obligation on the part of the employee to perform work. They cited Labour Court FTD 0611 and the House of Lords in Carmichael and another v National Power plc [1999] 1 WLR 2042 in support. The case Clark v Oxfordshire Health Authority [1998] IRLR 125 it stated “ A contract of employment within the meaning of the statutory definition cannot exist in the absence of mutual obligations subsisting over the entire duration..” The case Minister for Agriculture v Barry was also cited [2009] IR 215. In the case Terry McDonagh v Irish Rail [2015] it placed weight on the right of substitution. In this case the Complainant was a freelance independent contractor. There was no mutuality of obligation. He turned down 53 % of all work offered to him. He was not required to report to the Respondent on a daily basis for the purpose of being allocated work. He was offered work from time to time as it became available and he had the option for whatever reason to decline such work. When he declined work, he was not subjected to any form of disciplinary proceedings. E-mails were shown which confirmed this arrangement. He had the right to find a substitution or replacement without there being any repercussions. One email example he stated, “Grace replacing me tomorrow”. In the absence of mutuality of obligation there cannot be a contract of employment. He did not wear a uniform. He did not have a company email address or mobile phone he used his personal mobile. This was not an employer/employee relationship and the ADJUDICATION Officer does not have jurisdiction to hear this case.

Complainant

This was an employer/employee relationship. He had worked there since 2002. It was an informal relationship. This was not a regular job Monday to Friday. It was dictated by the number of shows/performances available. He was paid for the work done. His employer stated at the hearing that his Accountant advised the WRC in writing that his pay included an all-inclusive rate to take account of holiday pay, bank holiday pay and Sunday premium. Statutory deductions were made from his gross pay. He received P60s since 2002. This clearly shows that he was an employee and treated as one. He was given a level of freedom because he was a long-standing employee. He accepts that there were times when he was not available due to illness, such as sciatica, lower back pain. He accepts that he did not supply medical certificates. He stated that he gave work to colleagues. Work was often declined because of overlapping of shows. He has managed shows when the Directors were not available. This was an employer/employee relationship and the Adjudication has jurisdiction to hear this case.

Decision on Preliminary Point:

I find that there was considerable conflict of evidence in this case.

I note that in the “Kerry Foods” case the Supreme Court decided that each case must be determined in the light of its own particular facts and circumstances.

I note that there is an amount of case law on this subject that will require attention in order to arrive at a decision on this matter.

The Code of Practice for Determining Employment or Self-Employment Status of Individuals issued through the Department of Social & Family Affairs helps to form an understanding of this complex matter. It states “The overriding consideration or test will always be whether the person performing the work does so ‘as a person in business on their own account ‘. Is the person a free agent with an economic independence of the person engaging the service? This economic test is paramount”.

I note that Langford in The Classification of Workers: Employees and Independent Contractors “ (1998) 5 (3) CLP 63 states, “The courts have over the years sought to decide the issue by reference to a variety of legal tests, traditionally the control test. More recently, the courts have tended to adopt a practical test such as that of economic reality, or to have regard to all the different features of the work relationship and to engage in a balancing exercise in relation to all the various factors. The modern tendency would seem to be not to regard any one issue as conclusive but to look at the whole picture of the work situation”.

I note that in the case of McAuliffe v Minister for Social Welfare, Barr J. said it was not possible to devise any hard and fast rule as to what constitutes a contract of service.

In Sunday Tribune Ltd [1984] I.R. 505 Carroll J. stated: “The Court must look at the realities of the situation in order to determine whether the relationship of employer and employee in fact exists, and it must do so regardless of how the parties describe themselves”.

I have decided that it is necessary to consider the evidence as presented at the hearing under a series of tests as set out in the varying court cases that have dealt with this type of matter in the past.

1) Contract of Service / For Service

I find that no contract was issued so this test is inconclusive.

2) Pay

I note that the Complainant submitted a fee note which did not show actual hours worked but it was a show rate. I note that his hourly rate started at €12per hour and increased to €15 per hour. He was paid fortnightly. He was issued with payslips and received P60s each year.

I note that the Respondent’s Accountant wrote to the WRC to explain that “it was agreed at the outset that the fairest way to calculate the pay was to include an all-inclusive rate which compensated staff for their full entitlements … minimum wage increased by an amount to cover holiday pay, bank holiday and Sunday premium.

This would suggest that this was an employer/employee relationship.

3) Taxation / VAT

I note in the Henry Denny & Sons (Ireland) Ltd t/a Kerry Foods v The Minister for Social Welfare Kerry Foods case the demonstrator in question submitted an invoice yet it was deemed that she was an employee.

I also note that in the Phelan case a VAT invoice was submitted and it was also decided that he was an employee.

Therefore, I find that the submitting of a show fee note does not conclusively prove that the Complainant was self-employed.

I note that the Respondent made all the statutory deductions from his gross pay, issued payslips each fortnight and issued P60s each year.

I find that this would suggest that this was an employer/employee relationship.

4) Mutuality of Obligation

In order for a contract of service to exist there must be mutual obligations on the employer to provide work for the employee and on the employee to perform work for the employer. So there is an ongoing duty to provide work and one to accept work.

In High Court case Minister for Agriculture and Food v Barry & Ors the mutuality test of obligation was endorsed by Edwards J. when he stated” The requirement of mutuality of obligation is the requirement that there must be mutual obligations on the employer to provide work for the employee and on the employee to perform work for the employer. If such a mutuality is not present, then either there is no contract at all or whatever contract there is must be a contract for services or something else, but not a contract of service”.

I note the Labour Court case FDT 0611 referred to above which states, “One of the essential features of a contract of employment is mutuality of obligation, i.e. the obligation on the employing party to offer work and the obligation on the employed part to accept work”.

In this case, because of the nature of the business the Respondent was not obliged to provide work except when shows arose.

I find that the Complainant was not obliged to accept this work. I note instances where it was shown that he declined work or offered it to other people.

I note the evidence that he declined 53% of all work offered.

I found that no disciplinary sanctions were applied when he declined the work.

I found instances where he offered this work to others.

I did not find that there was an obligation on the Complainant’s part to commit to undertake this work when offered so there was no irreducible minimum of mutuality of obligation.

I find under this critical test that this was not an employer /employee relationship.

5) Control

Under this test the following matters needs to be addressed: deciding the thing to be done, way it is to be done, the means to be employed doing it and the time and place.

I found that the shows/events were operated under a manager at all times.

I did not find any evidence of control on how the job was done, however the task was clearly dictated by the event and I found that it called for little discretion regarding how the job was performed.

I find that this test is inconclusive.

6) Integration

I note that he did not wear a uniform, he did not have a Respondent’s email address and mobile phone. I found that he used his own when carrying out this work.

I find that he did not have to report to the office each day and operated on a casual basis.

I find that he was not integrated into this business.

I find that this was not an employer / employee relationship.

7) In business on own account

I found that he used his own phone and email address.

I found that he had carried out work for other organisations during this time.

I find that he had the opportunity to replace himself with others.

I find that he was in business on his own account and declined work when it did not suit him.

I find that this was not an employer/employee relationship.

Decision on the preliminary point

I have reflected on the evidence and I have concluded from the above tests that the facts as presented at the hearing demonstrate that this was not an employer /employee relationship.

Decision:

Section 41 of the Workplace Relations Act 2015 requires that I make a decision in relation to the complaints in accordance with the relevant redress provisions under Schedule 6 of that Act.

For the above stated reasons, I have decided that this was not an employer / employee relationship.

I have decided that I do not have jurisdiction to hear this case.

I have decided that this complaint was not well founded and so it fails.

Dated:   April 25th 2019

Workplace Relations Commission Adjudication Officer: Eugene Hanly

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