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-00023009-001

02/11/2018

The Complainant is a children’s entertainer / actor who has performed functions for the Respondent for approximately 15 years. The Complainant was issued with a number of fixed-term “Independent Contractor Agreements” that he accepted on an annual basis.

The Complainant submitted a complaint to the Workplace Relations Commission on 02/11/2018, this complaint was referred under section 39 of the Redundancy Payments Act, 1967.

The Complainant’s relationship with the Respondent ended on 21/12/2016.

The Complainant presented quite a comprehensive written submission at the hearing.

The following points were made from this submission:

1.       It is submitted that while the Terms and Conditions of Employment set out in the contract between the parties refer to the Complainant as an independent contractor, the dealings between the parties indicate that the Complainant was engaged as an employee and that the title of an independent contractor was used in order to avoid the obligations under the Act.

2.       It was argued that the case should be viewed in light of Henry Denny & Sons (Ireland) v Minister for Social Welfare ([1998] I.R.34) where the Court held that the prudent approach was to look behind the contact in place and establish the real relationship that existed between the parties. The Court emphasised the concept of control in an employer-employee relationship and held that while the Plaintiff’s contract referred to her as an independent contractor, the relationship between the parties was not equal and, therefore, she was an employee of the Respondent.

“In general, a person will be regarded as providing his or her services under a contract of service and not as an independent contractor where he or she is performing those services for another person and not for himself or herself. The degree of control exercised over how the work is to be performed, although a factor to be taken into account is not decisive. The inference that a person is engaged in business on his or her own account can be more readily drawn where he or she provides the necessary premises or equipment or some other form of investment, where he or she employs others to assist in the business and where the profit which he or she derives from the business is dependent on the efficiency with which it is conducted by him or her”.

3.       Reference was made to the Code of Practice for Determining Employment or Self-Employment Status of Individuals prepared by the Employment Status Group. Attention was drawn to the following points that represent an employee-employer relationship:

a)       The Agreement sets out guaranteed number of appearances, which can be viewed as a minimum number of hours/work not only promised to the Complainant, but also required to be performed by the Complainant.

b)      The Agreement referred to “specific locations and times” of appearances which would be selected and determined by the Respondent Company.

c)       The Agreement demanded that the Complainant look and act a certain way according to outlined specifications and requirements.

d)      The Respondent Company supplied at their own expenses all the equipment, costumes, wigs, stage props and stage/vehicle. The cost of maintenance of such was also reimbursed to the Complainant by the Respondent Company.

e)      The Agreement specifically dictates the rates at which the Complainant would be paid for each type of event, appearance and visit. While the Complainant was asked to provide VAT invoices, they were a mere recording of the appearances worked based on the rates given by the Respondent Company, rather than an independent charge for services provided.

f)        The Complainant was reimbursed for travel expenses, meals, accommodation, make-up and car parking. Annual trick grant was also paid to the Complainant.

g)       The Agreement demands that priority be given to the Respondent Company where scheduling conflicts may arise between appearances for possible other third parties.

h)      The Agreement forbids the Complainant from engaging as any other entertainment character for any quick-service restaurant operation, convenience food store, petrol station or mini mart during the term of the Agreement.

i)        The Agreement requires the Complainant to be available during certain holiday dates.

j)        The Respondent Company paid the Complainant’s insurance for comprehensive general liability arising out of bodily injury, property damage and personal injury.

k)       The Complainant was engaged based on his skills and talent and the provision of insurance means that the Agreement does not allow the Complainant to sub-contract the work to a different individual.

l)        The Agreement also places extensive privacy and copyright duties on the Complainant.

m)    The Agreement expressly states that the Complainant is engaged on behalf of the Respondent Company to promote and enhance the image of the business.

4.       It is clear from the language of the Agreement that the Complainant has no control over what is done, how it is done, when and where it is done and whether he does it personally, all factors which have to be present in order to hold the Complainant an independent contractor as per the Code of Practice for Determining Employment or Self-Employment Status of Individuals. The Complainant could not choose the fees to be charged for a specific performance and could not provide the same services to more than one person or business at the same time. He did not provide any of the equipment, customers etc and did not pay for his own insurance cover.

5.       Subject to the above, it is respectfully submitted that the Complainant had no bargaining power in the relationship as it was described by the Agreement and this would, therefore, render him employee of the Respondent Company.

6.       Furthermore, it is clear from the relationship between the parties that the requisite mutuality of obligation was present as per the determination of Edward J in Minister for Agriculture and Food v Barry and Others [2008] IEHC 216 as the company was obliged to provide the Complainant with work and the Complainant was obliged to carry out the work.

7.       It is accepted the Complainant was at all times engaged through an agency however under the Protection of Employees (Temporary Agency Work) Act 2012, and the party liable to pay the wages of the employee (the employment agency or client company) will, normally, be considered to be the employer of the agency worker. This is consistent with the position set down in Section 13 of the Unfair Dismissals Amendment Act 1993 which states the following:

“Where, whether before, on or after the commencement of this Act, an individual agrees with another person, who is carrying on the business of an employment agency within the meaning of the Employment Agency Act 1971, and is acting in the course of that business, to do or perform personally any work or service for a third person (whether or not the third person is a party to the contract and whether or not the third person pays the wages or salary of the individual in respect of the work or service), then for the purposes of the Principal Act, as respects a dismissal occurring after such commencement:

a)       the individual shall be deemed to be an employee employed by the third person

b)      under a contract of employment,

a)       if the contract was made before such commencement, it shall be deemed to have

c)       been made upon such commencement, and any redress under the Principal Act for unfair dismissal of the individual under the contract shall be awarded against the third person

8. Finally, where the employee’s fixed term contract is not renewed by reason of the position no longer being available, the employee is entitled to a redundancy package under the Redundancy Payments Act 1967. Therefore, the Complainant in this matter is entitled to same.

SUMMARY

The Complainant submits that he was an employee and that he is entitled to a redundancy payment in accordance with the Redundancy Payments Acts. The Complainant seeks the following reliefs:

a. A determination that the Complainant was an employee of the Respondent Company.

b. A determination that the Complainant was entitled to a redundancy payment in the amount of 31.02 x €600 = € 18,612.00.

c. A determination that the Respondent is the hirer / end user in respect of the obligation to discharge the redundancy payment.

The Respondent did not attend the hearing. I am satisfied that proper notification in relation to the hearing date, time and venue were sent to the Respondent in a timely manner.

There are three fundamental questions that have to asked in this case:

1.       Is the complaint ‘out of time’?

2.       Was the Complainant an employee?

3.       If the Complainant is an employee, who is the employer?

Question 1 – Out of Time?

Section 24 of the Redundancy Payments Act, 1967 as amended by the Redundancy Payments Act, 1971 and the Workplace Relations Act, 2015 reads as follows:

24. (1)– Notwithstanding any other provision of this Act, an employee shall not be entitled to a lump sum unless before the end of a period of 52 weeks beginning on the date of dismissal or the date of termination of employment-

(a) the agreement has been agreed and paid, or

(b) the employee has made a claim for the payment by notice in writing given to the employer, or

(c) a question as to the right of the employee to the payment, or as to the amount of the payment, has been referred to the Director General under section 39.

(2) Not withstanding any provision of this Act, an employee shall not be entitled to a weekly payment unless he has become entitled to a lump sum.

(2A) Where an employee who fails to make a claim for a lump sum within the period of 52 weeks mentioned in subsection (1) (as amended) makes such a claim before the end of the period of 104 weeks beginning on the date of dismissal or the date of termination of employment, the Adjudication Officer, if he is satisfied that the employee would have been entitled to the lump sum and that the failure was due to a reasonable cause, may declare the employee to be entitled to the lump sum and the employee shall thereupon become so entitled.

This now raises the question of ‘Reasonable Cause’

The Labour Court addressed ‘Reasonable Cause’ in Determination. DWT 0338 (Cementation SkanskaLimited and Tom Carroll) where they said:

“It is the Court’s view that in considering if reasonable cause exists, it is for 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 in which 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 upon. 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 not been present he would have initiated the claim in time”.

Given the circumstances the Complainant found himself in and that were fully explained to me at hearing I have decided that the complaint has been submitted to the WRC within 104 weeks and should be heard.

Question 2 - Was the Complainant an employee?

I have gone through the submission presented by the Complainant and note that it contains severalcopies of contracts that are titled “Independent Contractor Agreement”. The first comment I would make in relation to these contracts is that the Respondent is not a signatory. They are in fact contracts made between a named agency referred to as the Association and the Complainant, referred to as Contractor.

Clause 8 of these agreements reads as follows:

Contractor agrees

a)      That his sole relationship with the Association hereunder or otherwise is that of an independent contractor whose services have been engaged because of his theatrical talents and that he is not an employee or agent of the Association;

b)      That said relationship does not require the Association to withhold income taxes, or to pay any other tax with respect to the amounts payable to Contractor hereunder;

c)       That he will pay all taxes, including the tax on self-employment income and any estimated instalments of income taxes, which are incurred by him in connection with the services provided hereunder to the Association.

d)      The Association will not be responsible for unemployment compensation or workers’ compensation insurance.

Clause 4 of this agreement contains the following under the heading of Compensation.

……, payment will be made to Contractor by the Association within 30 days of each monthly VAT invoice submitted, on a performance basis as follows; …….

I have considered the arguments made by the Complainant and consider his status is that of self-employed contractor, he is not an employee and is therefore not entitled to any redundancy payment from the Respondent.

The complaint as presented is not well found and therefore fails.

The Complainant was not at any stage an employee of the Respondent. The Complaint is not well found and therefore fails.

Redundancy; employment status.