Complainant

Respondent

Anonymised Parties

Development Executive

Development Company

Representatives

Myles Gilvarry Gilvarry & Associates

Declan Thomas IBEC

Act

Complaint/Dispute Reference No.

Date of Receipt

Complaint seeking adjudication by the Workplace Relations Commission under Section 14 of the Protection of Employees (Fixed-Term Work) Act, 2003

CA-00017984-001

15/03/2018

Complaint seeking adjudication by the Workplace Relations Commission under Section 14 of the Protection of Employees (Fixed-Term Work) Act, 2003

CA-00017984-002

15/03/2018

BACKGROUND

The Claimant , commenced employment with the respondent hereafter called “WDC”) on the 15th January 2014. WDC and is funded by the Department of Rural and Community Development (hereafter called “the Department”). Permanent staff is paid out of the budget awarded by the Department.

SUBSTANTIVE COMPLAINT

The claimant has brought a claim to the Adjudicator for breach of section 14 of the Act.

In section 9 the Act provides “.—(1) Subject to subsection (4), where on or after the passing of this Act a fixed-term employee completes or has completed his or her third year of continuous employment with his or her employer or associated employer, his or her fixed-term contract may be renewed by that employer on only one occasion and any such renewal shall be for a fixed term of no longer than one year.

(2) Subject to subsection (4), where after the passing of this Act a fixed-term employee is employed by his or her employer or associated employer on two or more continuous fixed-term contracts and the date of the first such contract is subsequent to the date on which this Act is passed, the aggregate duration of such contracts shall not exceed 4 years.

(3) Where any term of a fixed-term contract purports to contravene subsection (1) or (2) that term shall have no effect and the contract concerned shall be deemed to be a contract of indefinite duration.

(4) Subsections (1) to (3) shall not apply to the renewal of a contract of employment for a fixed term where there are objective grounds justifying such a renewal.

(5) The First Schedule to the Minimum Notice and Terms of Employment Acts 1973 to 2001 shall apply for the purpose of ascertaining the period of service of an employee and whether that service has been continuous.

The Act was enacted for the purposes of putting into effect the Council Directive 1999/70/EC – 28th June 1999 concerning the framework agreement on fixed-term work concluded by ETUC, UNICE and CEEP (‘the Directive’). Article 2 of the Directive requires member states to “bring into force, the laws, regulations and administrative provisions necessary to comply with this Directive”. The framework agreement is annexed to the Directive with Clause 5 providing:

       “1. To prevent abuse arising from the use of successive fixed-term employment contracts or relationships, member states, after consultation with social partners in accordance with national law, collective agreements or practice, and/or the social partners shall, where there are no equivalent legal measures to prevent abuse, introduce a manner which takes account of needs of specific sectors and/or categories of worker, one or more of the following measures:

             (a)Objective reasons justifying the renewal of such contracts or relationships

           (b)The maximum total duration of successive fixed-term employment contracts or relationships

           (c)The number of renewals of such contracts or relationships

       2. The member states after consultation with social partners and/or the social partners shall, where appropriate, determine under what conditions fixed-term employment contracts or relationships

           (a) Shall be regarded as successive

            (b) Shall be determined to be contracts or relationships of indefinite duration.”

The claimant commenced work for the respondent on the 14th January 2014. The claimant’s representative Her initial contract was stated to be

“ The apppointment is a short term specific duration support to fulfill the specific purpose of regional development team support required to complete the needs of the renewable energy sector in general and specifically the X project which will finiish 30th.Sept. 2014”

Her second contract was dated 1st October 2014 and the purpose was stated to be;

“ The apppointment is a short term specific duration support to fulfill the specific purpose of regional development team support required to complete the needs of the renewable energy sector in general and specifically the X 2 project which will finiison the 30th.June 2015”.

Her third contract commenced from 1st July 2015 and was stated to be;

“ The apppointment is a short term specific duration support to fulfill the specific purpose of regional development team support required to complete the needs of the renewable energy sector in general and specifically the X 2 project which will finish November 2015”.

Her fourth contract commenced from 1st December 2015 and was stated to be;

“The respondent is pleased to offer you an appointment as temporary Project Co-Ordinator for the EU funded G project (with duties as set out in the Job Description Annex and/or duties section) in the WDC on the following terms and conditions with effect from the 1st.Dec. 2015.This contract is issued in accordance with the Unfair Dismissals Acts 1977 to 2007 and the Minimum Notice and Terms of Employment Acts 1973-2005.

The contract goes on, inter alia, to purport to be a fixed term contract, in contravention of section 9(3) of the Act;

Tenure

3.1 The appointment is to a temporary , unestablished position in the Public Service.IT will csaes on the 31st.August 2018.

3.2IN accordance with the Protection of Employees (Fixed Term Work )Act 2003, your contract is on a fixed term contract basis only , on the following grounds :

This contract commences on the 1st.Dec. 2015 and will terminate on the 31st.August 2018.

This post is offered based on sanction received by the respondent from its parent dept , for a fixed term contract for a Project co-ordinator for the EU Interreg co funded project titled G….

The G…project is co funded by the European union Interreg Northern Periphery and Artic programme.

The claimant had an uneventful career until January 2018. While part of her time was devoted to the particular projects mentioned in the specified contracts (and only the reason for her final contract was given to her in advance in writing prior to renewal, in contravention of the Act), she carried out numerous other duties. She developed and obtained EU funding for a number of projects, she worked on various other projects not mentioned in her contracts, and she was at all times treated as a permanent employee. Her wages were paid out of the Department allocation for staff, not out of the staff grant given by the EU for the various headline projects mentioned in her contract.

In January 2018 her union, Forsa, approached management about regularising her status and that of two other workers who were on successive contracts. She noticed her pay as of January 2018 was now being paid out of the EU project fund, instead of the staff allocation from the department, as heretofore. Her union was unable to make any progress with Management, and ultimately with the Head of Corporate Resources who dealt with HR matters due to go on Maternity Leave, and facing the end of her contract with no decision made by WDC, she lodged this claim with the WRC.

The claimant experienced a distinct shift in attitude to her from her manager after lodging the claim. She had obtained approval from the EU for other projects in particular BIZMENTORS which would cover full staff costs for 3 years, but her manager has unexplainably delayed and stalled signing off acceptance of the offer, and she has suffered exclusion in work and been side-lined from the projects she was working on.

The position of the Labour Court in relation to section 9(3) of the Act is that it has followed the decision of the High Court in Minister for Finance -v- McArdle          [2007] IEHC 98 where Ms Justice Laffoy stated of section 9(3)     "That Section applies to a situation where an employee is given a renewed fixed-term contract in contravention of subs.(1) or(2). In such a case subsection (3) would operate so as to render void, ab initio, the term of the contract which purports to provide for its expiry by effluxion of time, or the occurrence of an event. Hence, by operation of law the offending term would be severed from the contract thus altering its character from one of definite duration, or fixed-term, to one of indefinite duration. However, the remaining terms and conditions of the contract would be unaffected including terms as to pensionability and termination, which as already observed, would have had to be aligned with those of a comparable permanent employee in accordance with Section 6." )

It is clear that the contract is not saved by section 9(4) of the Act as there were and are numerous other EU projects in the pipeline, and indeed the G…. funding does not expire on the 31st of August but rather a month later. In the Labour Court decision of Teagasc and NcNamara (FTD 138, dated 15th April 2013, the Court stated;

“The question of whether the requirement for external funding can give rise to objective justification for the continued use of fixed-term contracts presents difficulties of principle. There are many forms of economic activity in which the viability of employment is dependent on funding generated by individual contracts or projects. That is the case in practically all employments providing professional services and in such industries as construction and civil engineering. That type of activity is dependent on a continuing supply of separate once-off contracts or projects in order to maintain employment. If it were to be held that the use of successive fixed-term contracts could be used indefinitely in such employments so as to protect the employer against the possibility of an insufficient supply of work at some point in the future the effectiveness of the Directive and the Act would be seriously subverted. If, due to economic circumstances or fall-off in demand, there is no longer sufficient work in order to maintain a worker in employment the employer’s remedy lies in making surplus staff redundant.”

REMEDY SOUGHT

The claimant seeks a determination by the Adjudicator that she is employed on a contract of indefinite duration commencing on the 15th January 2018, and continues to be employed on that contact, and compensation for the respondents’ breaches of the Act.. ….

The claimant argued that throughout her employment she worked both on projects and on generic work for the respondent.Her representative stated that 30-75% she was assigned headline assignments and the remainder of her time was spent on other projects. – she set out an account of her imput into writing and developing projects.She submitted that the projects in her remit overlapped on a continuous basis.She contended that up to Jan 2018 she had always been paid from the staff budget and was moved to the EU budget - she asserted another staff member continued to be paid from the staff budget even though was working on EU projects.

It was asserted that the respondent’s reliance on Maynooth College v Dr.Buckly was misconceived and another Labour Court panel may adopt a different approach – it was argued that the reference to resiling from an agreement was inappropriate and should not preclude a claimant from seeking redress under the Act.It was submitted that the Maynooth case was different from the instant case and that the claimant’s claim rested on its own specific facts.

It was argued that while FTD 135 could be distinguished from the claimant’s case as the claimant was undertaking work that was part of the respondent’s core and permanent needs , the case in fact supported the claimant’s assertions – it was submitted that EU development work was part of the fixed and permanent needs of the respondent.The claimant worked on back to back contracts for almost 5 years – it was advanced that the respondent could not rely on Section 9(4) given the numerous EU projects in the pipeline and that the principles set out in FTD 138 Teagasc and McNamara should apply to the claimant’s case as it was on all fours with the instant case.It was argued that the reliance of the respondent on non permanent funding was not an objective ground and this principle was established by the Court in McNamara.It was contended that 65%of staff costs were met by the EU .Th claimant’s representative questioned if it was reasonable to engage someone on back to back contracts in such circumstances and given that the claimant spent 50-60% of her time on Headline projects and the remainder of her time on core work.

Adjudication Officer,

The case before you today relates to a claim taken by (the Claimant) under the Protection of Employees (Fixed-Term Work) Act, 2003 against (the Respondent). The Claimant alleges that the respondent has contravened the legal provisions in relation to the number of successive fixed-term contracts that can be issued. The claimant further alleges in her Complaint (Appendix 1) that she has entitlement to a contract of indefinite duration (CID) and that she has not been provided with objective grounds justifying the renewal of her fixed-term contracts. The respondent disputes the Claimant’s assertions in their entirety.

Background to the company

The (WDC) is a statutory body that was set up to promote both social and economic development in the Western Region ) by:

·         Ensuring that government policy is directed at improving the social and economic situation in the region.

·         Developing projects in tourism, industry, marine, renewable energy, technology and organic agri-food, and so on.

·         Operating the Western Investment Fund (WIF) to provide loans and equity to business and local communities in the West.

Background to the Claim

1.       The WDC in undertaking their Regional Development remit in addition to annual exchequer allocations (which are significantly diminished in recent years), use transient approaches such as EU , Local authority and other exchequer programming etc. to implement their change programmes.

2.       The claimant commenced employment on 15th January 2014 on a fixed-term contract (Appendix 2) on the NPP Interreg “x” project which was an EU funded project. This contract came to an end on 30th September 2014.

3.       The claimant was subsequently employed from 1st October 2014 on a fixed-term contract (Appendix 3 – NEED A COPY) on the X2project which was a separate EU funded project. This contract came to an end on 30th June 2015. Clause 4 “Specific Purpose” of this contract outlines the objective justification for the use of a fixed-term contract.

4.       The respondent was granted subsequent EU funding for this X2 project, and the claimant was offered a fixed-term contract for the project from 1st July 2015 (Appendix 4). This contract came to an end on 30th November 2015. Clause 4 “Specific Purpose” of this contract outlines the objective justification for the use of a fixed-term contract.

5.       In 2015, the WDC were approved for an EU project called Generating Renewable Energy Business Enterprise (G…..). The formal grant offer letter (GOL) was received 15th December 2015. The finish date for the project was 31st August 2018.

6.       The claimant then received a fixed term-contract on 1st December 2015 (Appendix 5) for this position of Project Co-ordinator for the G…. project. The Claimant was paid €46,081 gross per annum (€3840.08 per month) based on the first point of the Higher Executive Officer standard salary scale.

7.       The relevant extracts of this fixed-term contract are as follows;

3.1 The appointment is to a temporary, unestablished position in the Public Service. It will cease on 31st August 2018.

3.2 In accordance with the Protection of Employees (Fixed Term Work) Act 2003, your contract is on a fixed term contract basis only, on the following grounds:

·         This contract commences on 1st December 2015 and will terminate on 31st August 2018.

·         The post is offered based on sanction received by the respondent from its parent Department, for a fixed -term contract for a Project co-ordinator for the EU Interreg co-funded project called G…….

·         The G project is co-funded by the European Union Interreg Northern Periphery and Artic (NPA) Programme. (Appendix XXX)

8.       In September 2017, sanction was received by the respondent and an open competition held for a clerical officer (CO) post for G with a specified end date of 31st August 2018. The project end date was clearly communicated to all concerned parties – it formed part of the employment contract.

9.       In June 2018 another EU project employee exited the employment when their project term ended 10th June 2018. There has been no objection from the stated party to the clear terms of their contract.

The Legislation – Protection of Employees (Fixed-Term Work) Act 2003

Objective grounds

The relevant provisions in relation to this case are as follows:

Section 7 explains the definition of “objective grounds for the purposes of Part 2 of the Act.

“7.—(1) A ground shall not be regarded as an objective ground for the purposes of any provision of this Part unless it is based on considerations other than the status of the employee concerned as a fixed-term employee and the less favourable treatment which it involves for that employee (which treatment may include the renewal of a fixed-term employee's contract for a further fixed term) is for the purpose of achieving a legitimate objective of the employer and such treatment is appropriate and necessary for that purpose.”.

Section 8 of the Act above requires that in the case of a fixed-term contract that (1) the employee be informed in writing as soon as practicable of the objective condition determining the issuing of a fixed-term contract, and (2) in the case of renewal of a fixed-term contract that the employee be informed in writing of the objective grounds for doing so no later than the date of renewal.

8.—(1) Where an employee is employed on a fixed-term contract the fixed-term employee shall be informed in writing as soon as practicable by the employer of the objective condition determining the contract whether it is—

(a) arriving at a specific date,

(b) completing a specific task,

(c) the occurrence of a specific event.

(2) Where an employer proposes to renew a fixed-term contract, the fixed-term employee shall be informed in writing by the employer of the objective grounds justifying the renewal of the fixed-term contract and the failure to offer a contract of indefinite duration, at the latest by the date of the renewal.

(3) A written statement under subsection (1) or (2) is admissible as evidence in any proceedings under this Act.

The respondent contends that the conditions above have been applied in this case. The claimant was informed in writing of the objective reason for the issuing of each fixed-term contract as outlined above.

Entitlement to a contract of indefinite duration

Section 9 of the Act stipulates when an employee is entitled to a contract of indefinite duration and states that such entitlement does not apply where an employer has “objective grounds” (as defined under Section 7 of the Act) justifying the renewal of the contract on a fixed-term.

9.—(1) Subject to subsection (4), where on or after the passing of this Act a fixed term employee completes or has completed his or her third year of continuous employment with his or her employer or associated employer, his or her fixed-term contract may be renewed by that employer on only one occasion and any such renewal shall be for a fixed term of no longer than one year.

(2) Subject to subsection (4), where after the passing of this Act a fixed-term employee is employed by his or her employer or associated employer on two or more continuous fixed-term contracts and the date of the first such contract is subsequent to the date on which this Act is passed, the aggregate duration of such contracts shall not exceed 4 years.

(3) Where any term of a fixed-term contract purports to contravene subsection (1) or (2) that term shall have no effect and the contract concerned shall be deemed to be a contract of indefinite duration.

(4) Subsections (1) to (3) shall not apply to the renewal of a contract of employment for a fixed term where there are objective grounds justifying such a renewal.

In her claim form, the claimant claims that she is entitled to a contract of indefinite duration as per Section 9(3) of the Act. The respondent refutes this claim in its entirety and seeks to rely on section 9(4) of the Act, as there were objective grounds justifying the renewal of each fixed-term contract. The claimant was at all times aware that each contract was dependent on EU funding for that particular project. Projects funded by the EU were entirely independent from one other. The respondent contends that the claimant was aware that each fixed-term contract had a clearly defined end date from the outset and was finite in its nature and funding. Consequently, the claimant was also aware of the objective grounds justifying same.

Case Law

The respondent relies on the case of NATIONAL UNIVERSITY OF IRELAND MAYNOOTH and DR ANN BUCKLEY FTD 092(Appendix 6) where the claimant was offered a fixed term contract relating to a funded project for a finite period of time. The claimant was employed on two successive fixed-term contracts and claimed that she was entitled to an indefinite contract. On the issue of the contract of indefinite duration, the Court noted that on the Staff Appointment Form, where it was asked what the objective grounds justifying the renewal of the contract were, the claimant had written that the contract was conditional on the award of funds from her funding body. In response to a further question justifying failure to offer a contract of indefinite duration, the claimant herself had written “the grounds are that the funding for this contract has been provided for a maximum of two years”.

Both of these statements were contained in the contract itself, which Dr Buckley signed on 31st October 2006. In the Court’s view, the relevant sections of the Staff Appointment Form were plainly expressed and it was made clear that further fixed-term work, rather than a contract of indefinite duration, was being offered. The Court did not accept that Dr Buckley did not know what she was signing and also considered it significant that Dr Buckley did not consult her union or take legal advice (which she could have), if she was in doubt as to the meaning of the words involved. The Court felt that having signed a binding contract agreeing to the objective reasons for its renewal on a fixed-term basis, the claimant could not subsequently resile from this position. Therefore, she was not entitled to a contract of indefinite duration.

The respondent also seeks to rely on the case of IARNROD EIREANN (IRISH RAIL) and TREVOR HIGGINS FTD135 (Appendix 7). In this case, the claimant was employed on two successive fixed-term contracts to work on capital projects and claimed he was entitled to a contract of indefinite duration and that there were no objective grounds justifying the successive renewal of his fixed-term contracts. The facts to the case were that the renewed fixed-term contract stated that the relevant capital projects were dictated by funding. The respondent in this case also advised the claimant of the objective grounds justifying the renewal of the fixed-term contract in writing and clarified why a contract of indefinite duration could not be offered. In said correspondence, the respondent stated that the claimant’s continued employment was dependent on approval for funding in relation to proposed capital projects. Furthermore, the respondent advised the claimant that it was not possible to offer permanent employment as the position was funded by capital provisions in respect of projects undertaken by the respondent.

In this case, the Court stated the following in relation to the definition of “objective grounds” as defined under section 7 of the Act;

“In Case C-380/07Kiriaki Angelidaki and Others v Organismos Nomarkhiaki Aftodiikisi Rethimnis and Dimos Geropotamou[2009] ECR 1-3071,the CJEU drew a distinction between work undertaken for the purpose of meeting the fixed and permanent needs of the employer and work for the purpose of meeting some temporary or transient need. While work in the former category should normally be undertaken on permanent contracts of employment, temporary or fixed-term contracts would normally be suitable for work in the latter category. This would include, for example, project work which is temporary and non-recurring by its nature.”

The Court concluded:

“The Court is satisfied that the Claimant was at all times employed on project work the duration of which was limited in time and the availability of specific funding over which the Respondent did not have control. Consequently the work concerned was not part of the fixed and permanent needs of the Respondent. This was made clear by the Respondent in written notifications furnished to the Claimant on each occasion on which his employment was renewed for a fixed-term.”

The Court therefore determined that the claimant remained a fixed-term employee throughout the full period of their employment and that the respondent did not contravene any provisions of the Act.

Respondent’s Position

1.       The specific projects for which the claimant was employed were all funded for a finite period and were all subject to EU funding until a specified date.

2.       This was advised to the claimant at the time of offering each fixed-term contract. The provisions for objective justifications in line with Section 8 of the Act were outlined to her in writing in each contract of employment.

3.       The nature of each fixed-term contract was ringfenced to finite EU funding for specific projects. These projects, and their funding, were granted to the respondent completely independent from one another. The claimant also worked on three separate EU funded projects which were transient in their very nature. The respondent contends that the use of fixed-term contracts for such projects was objectively justified in all the circumstances.

4.       Notwithstanding this, the respondent argues that it would be entirely disingenuous of the respondent to offer a contract of indefinite duration to the claimant for such projects due to the finality of funding as well as the transiency of the work itself.

5.       The claimant knowingly signed each contract of employment thereby entering into a legally binding agreement and has not, up to this point, sought to raise issue with this. She therefore, is not entitled at this juncture to alter the terms of said agreements and seek a contract of indefinite duration.

6.       In her claim to the Workplace Relations Commission, the claimant believes that by virtue of section 9(3) of the Act, she should have a contract of indefinite duration. However, it is the Organisation’s contention that by virtue of section 9(4) of the Act it has established objective grounds for not offering Ms Leonard a contract of indefinite duration.

Conclusion

Accordingly, the respondent respectfully requests that her claim for a contract of indefinite duration be rejected.

It was submitted that each project was independent of each other , had a finite time frame , that they were assigned on an individual basis and were not of a rolling nature.While it was accepted that the claimant worked on other projects , it was contended that the claimant spent 80-90% of her time on specific projects.It was submitted that the X2 projects were iinitiated without the respondent seeking funding – reflecting the transient nature of funding arrangements.

Owing to budgetary concerns the management committee met on the 12th.June 2018 to examine external staff resources.The respondent had 13 permanent   staff members – 2 of whom were on CIDS.5 Fixed term staff were employed on transient projects.While   there were projects in the pipeline it was indicated that they may not be approved.It was submitted that all of the projects were independent of each other , for a confined length of time and that this constituted objective justification.It was submitted that permanent staff are spending less and less time on project work – estimated at 25%..

It was submitted that the revised funding system supplanted any need for EU funding for which there was a diminishing need. The respondent was moving towards long term strategic projects. The company cannot avail of an overdraft .It was argued that it was irrelevant where pay was coming from and the claimant was fully aware of what she was signing up to

While I note from the claimant’s submission that the complaint made is of a breach of Section 14 of the Act , I am satisfied that the respondent was on notice from the body of the complaint and based on the respondent’s own submission , that this complaint is of a breach of Section 9 and the non provision of a CID to the claimant.

I have reviewed the evidence presented by the parties and noted the respective positions of the parties. While I note that there are references and suggestions of penalisation in the claimant’s submission , no complaint has been made under Section 13 of the Act.

The claimant is asserting that by virtue of her continuity of service to August 2018 , she was entitled to a Contract of indefinite Duration.The respondent is arguing that the entitlement to a CID does not arise in circumstances where there is objective justification for the renewal of the contract.

I have noted the submissions of the parties and the authorities relied upon.I have given consideration to the final contract issued to the claimant dated the 1st.Dec. 2015 and noted the contents of same and the duties and job description set out for co-ordinating the Grebe project.Having considered the authorities invoked by the respective parties , I find Labour Court Determination FTD 138 Teagasc and McNamara to be most relevant to the instant case. The claimant   commenced her fourth successive contract   on the first December 2015 – on the 1st.Jan. 2018 , the claimant had acquired 4 years service aggregate service .As set out in FTD 138 , this contract would have been one transmuted to a CID unless there were objective grounds justifying that renewal.

I found the cliamant’s evidence that she performed both generic core work and project work over her period of employment to be credible and convincing .While both parties argued at length about the source of funding for the post , the Court has already determined in FTD 138 the difficulties of principle in relying upon the requirement for external funding giving rise to objective justification.This was highlighted by the claimant’s representative at the hearing and it was argued that this issue was on all fours with the circumstances of the claimant .The Court determined that the net question that falls for determination was whether the work for which the claimant was employed should properly be classified as coming within “ the fixed and permanent needs of the respondent or whether it was part of a purely temporary or transient need”.

The respondent is charged with promoting social and economic development in the West – a brief not dissimilar to Teagasc which provides research , advisory and education in agriculture , horticulture , food and rural development.On the basis of the evidence presented I am satisfied that the work of providing specialised support to the respondent’s projects and the co-ordination of such projects is part of the core brief of this development agency.Accordingly , I am upholding the complaint and find that the claimant’s contract of the Ist.Dec. 2015 was transmuted to a Contract of Indefinite Duration by operation of law from that date.

The claimant’s complaint was received by the Commission on the 15.th.March 2018.The claimant’s final contract was issued on the 1st.Dec. 2015. Consequently the complaint under Section 8 is out of time and I have no jurisdiction to investigate same.