Complainant

Respondent

Anonymised Parties

A Childcare Worker

A Crèche

Representatives

Mr. Eamonn Gibney, The HR Department

Ms. Kiwana Ennis B.L. on the instructions of Anne O'Connell Solicitors

Act

Complaint Reference No.

Date of Receipt

Complaint seeking adjudication by the Workplace Relations Commission under Regulation 10 of the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003 (S.I. No. 131 of 2003)

CA-00020033-002

18/04/2018

Complaint seeking adjudication by the Workplace Relations Commission under Regulation 10 of the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003 (S.I. No. 131 of 2003)

CA-00020033-003

18/04/2018

The crèche business which employed the Complainant was transferred to the Respondent, Mr. B (the Transferee) by way of a transfer of undertakings on 9 April, 2018. The Complainant was employed by the Transferor, Ms. A, between May, 2016 and 6 April, 2018 when her employment was terminated.

The Complainant claims that the Respondent, Mr. B (the Transferee) has contravened the provisions of Regulation 4 of the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003 in relation to the transfer of her terms and conditions of employment arising from the transfer. The Complainant also claims that the Respondent has contravened the Regulations in relation to the provision of information in writing regarding the transfer of undertakings and any matters pertaining to her terms and conditions of employment.

The Respondent contends that the Complainant resigned her employment with the Transferor, Ms. A, prior to the date of the transfer of the business after she had confirmed that she was opting out of transferring. The Respondent contends that as a result of her resignation prior to the transfer that no rights or obligations in relation to the Complainant’s employment were transferred to the Respondent. The Respondent denies that it has contravened any of the Regulations in relation to the transfer of the Complainant’s employment.

The Complainant also referred complaints to the WRC under the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003 in which the Transferee, Mr. B’s wife was named as the Respondent (namely, Complaint Ref. Nos. CA-00020032-002 and CA-00020032-003). The Complainant confirmed at the oral hearing on 19 February, 2019 that both of these complaints were withdrawn.

The Complainant also referred a separate complaint to the WRC in relation to alleged contraventions of Regulation 4 and Regulation 8 the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003 in which the Transferor, Ms. A, has been named as the Respondent (this complaint has been dealt with in the decision under Adjudication Reference No. ADJ-00013956).

CA-00020033-002 - Complaint under the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003

The Complainant was employed by Ms. A (the Transferor) as a Crèche Manager from 20 May, 2016 until 6 April, 2018 when her employment was terminated. The Complainant submits that she was informed by Ms. A approx. two weeks prior to the termination of her employment that the business was being transferred to a new owner, the Respondent, Mr. B. The Complainant stated that she had an introductory meeting with Mr. B (the Transferee) on 4 April, 2018 which was also attended by Ms. A. The Complainant made enquiries at this meeting in relation her terms and conditions of employment going forward and was informed by the Respondent (the Transferee) that he did not have any answers for her that day as it was only an introduction meeting.

The Complainant had a further meeting with the Respondent, Mr. B (the Transferee) and Ms. A (the Transferor) on 6 April, 2018 to address matters regarding her terms and conditions of employment pre-transfer and post-transfer of the business. The Complainant contends that she had not been issued with a written statement of her terms of employment during her period of employment with Ms. A (the Transferor). The Complainant claims that she was informed by the Respondent, Mr. B at this meeting that there would be a number of changes to her terms and conditions of employment following the transfer of the business, namely that:

·         Her role as Manager of the crèche would cease as Mr. B would assume that role once the business transferred.

·         She would have to work a back week before receiving payment of wages.

·         Her entitlement to three paid sick days in any one year would cease.

·         Her Christmas bonus of €500 which had been routinely paid every year would cease.

·         The crèche facility space for her infant child that was provided free of charge by agreement with the Transferor would cease and she would be required to pay for this facility from the date of the transfer (on 9 April, 2018).

·         She was given no indication that her daily rest break entitlement going forward would be allowed to reflect the 4.5 maximum hours worked rule.

The Complainant contends that she was bullied by Ms. A at this meeting and was accused of hiding her contract to which she responded that had never been provided with a written contract. The Complainant claims that she was prevented from leaving the room (with her child in her arms) by Ms. A who placed her foot at the door and told her that she couldn’t leave until she produced her written contract of employment for her. The Complainant contends that this behaviour by Ms. A was very upsetting, stressful and embarrassing and she had to ask Ms. A to “please get out of my way” so that she could leave the room in a distressed state with her infant child.

The Complainant contends that she received an intimidatory text message from Ms. A on 7 April, 2018 regarding her non-existent contract of employment. The Complainant submits that she informed Ms. A by return e-mail that she was not in a position to transfer to the employment of the Respondent, Mr. B, as a result of the proposed less favourable changes to her terms and conditions of employment. The Complainant indicated to Ms. A that she would be remaining in her existing employment until further notice.

The Complainant submits that she also received an e-mail from the Respondent, Mr. B, on Saturday, 7 April, 2018 in which he attempted to exonerate himself from the difficult meeting the previous day. It was also indicated in this e-mail that Mr. B was prepared to offer her “the same contract as was previously in place with your colleagues”. However, the Complainant contends that her terms and conditions were different to her colleagues which was at variance with what was discussed at the meeting the previous day.

The Complainant replied to the Respondent, Mr. B, by e-mail on 9 April, 2018 confirming that she would not be in a position to transfer to his employment as the proposed material changes to her terms and conditions of employment were unacceptable.

The Complainant claims that on Monday, 9th April, 2018 she found her P45 among her child’s belongings that her husband had collected from the crèche late on the previous Friday. The Complainant sent an e-mail to Ms. A on 9th April, 2018 acknowledging receipt of her P45 and the intimidatory text from the previous Saturday.

The Complainant claims that the Respondent, Mr. B (the Transferee), has contravened the provisions of Regulation 4(1) by failing to observe the terms and conditions that she was entitled to in relation to her employment with Ms. A (the Transferor).

CA-00020033-003 – Complaint under the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003

The Complainant contends that the Transferor (Ms. A) informed her approx. two weeks before the transfer date of 9 April, 2018 that the crèche would transfer to the Respondent, Mr. B (the Transferee). This information was communicated to her in a verbal conversation. The Complainant submits that neither the Transferor nor the Transferee provided her with any information on matters pertaining to her terms and conditions of employment as required by the Regulations.

The Complainant further submits that she was not afforded reasonable time to review and consider the proposed changes to her terns and conditions and was not offered the opportunity of any representation by either the Transferor/Transferee to assist with the consultation process.

The Complainant claims that the Respondent, Mr. B, has contravened the provisions of Regulation 8 by failing to consult with her and to provide her with the required information in relation to the transfer of the business.

CA-00020033-002 – Complaint under the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003

The Respondent, Mr. B, is a sole trader and took over the running of the crèche where the Complainant had been employed on 9 April, 2018 following a transfer of undertakings. The Complainant had been an employee of the Transferor from 20 May, 2016 until 6 April, 2018. The Respondent engaged with the Transferor for a number of months prior to the transfer date and a communication was issued to parents of the children in the crèche and copied to all staff in relation to the transfer in March, 2018.

On 5 April, 2018, the Respondent met with the Transferor and went through all of the employees’ contracts of employment including that of the Complainant and noted that they were all identical, even though the Complainant was the Manager of the creche.

On 6 April, 2018, the Respondent went to the crèche to meet the staff together with the Transferor and to give them all reassurances that there would be no changes to their terms and conditions of employment and that everything, including schedules, would remain the same. The meeting went well with all members of staff except for the Complainant. The Complainant argued with the Transferor, resigned and demanded that the Transferor issue her P45 that day and left. The Respondent, Mr B, adduced evidence that he clearly informed the Complainant at this meeting that she would retain the position of Manager following the transfer of the business and the same terms and conditions that she had enjoyed with Ms. A (the Transferor).

The Respondent submits that it was discovered at the meeting on 6 April, 2018 that the Complainant’s contract of employment was missing. The Respondent contacted the Complainant the following day (on 7 April, 2018) by e-mail and stated that he wished to discuss offering the Complainant the contract that was previously in place thereby in effect confirming that she would continue in employment on the same terms and conditions. The Respondent concluded by stating that he was available to discuss any outstanding matters that she may have.

The Complainant replied to the Respondent by e-mail dated 9 April, 2019 stating that she was “unable to transfer” to his employment as she had outstanding issues with her “current employer” that needed to be addressed. In the same e-mail the Complainant alleged that the Respondent made a verbal offer on 6 April, 2018 with “material changes” to her terms of employment which were not acceptable. However, she never specified the alleged “material changes”. Furthermore, the Complainant’s e-mail did not comment on the fact that the Respondent had reassured her in his e-mail on 7 April, 2018, the day after their meeting, that her terms and conditions would not be altered. The Respondent submits that the Complainant did not transfer to his employment and was never an employee.

The Respondent disputes the claim that it has contravened the provisions of Regulation 4(1) in relation to the Complainant’s terms and conditions of employment following the transfer of the business. The Respondent made the following submissions in support of its position:

·         The Complainant was not an employee at the transfer date on 9 April, 2018.

·         The Complainant resigned her employment with the Transferor on 6 April, 2018 for reasons unconnected with the Respondent.

·         The Complainant opted out of transferring to the Respondent’s employment and is therefore not protected by Regulation 4(1).

·         The Respondent reassured the Complainant verbally on 6 April, 2018 and by e-mail on 7 April, 2018 that her employment would continue on the same terms as she had with the Transferor.

·         The Respondent requested the Complainant to engage with him further in relation to any queries she may have had but she did not.

The Respondent relied upon the following cases, namely: Symantec Limited -v- Leddy and Lyons [2010] ILMR 112, Kastiskas -v- Konstantinidis and Skreb [1993] IRLR 179, Mikkelsen -v- Danmols Inventar A/S [1986] 1 CMLR 316, Norton -v- Securway AT Risk Security Group Limited UD865/2015 and Ardcolum Motor Factors Limited -v- McManus RPD14/2017.

CA-00020033-003 – Complaint under the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003

The Respondent disputes the claim that it has contravened the Regulations in relation to employee representatives and the preservation of same after the transfer of undertakings. The Respondent submits that the Complainant’s representative, by letter dated 7 September, 2018, appeared to amend the claim in respect of a contravention of Regulation 7 by stating that the Transferor did not inform the employees representatives of certain details relating to the transfer, which would seem to be an allegation of a contravention of Regulation 8 in respect of information and consultation.

The Respondent submits, that in respect of Regulation 8, given that it was not envisaged that any measures would be taken, there was no obligation to consult with employees prior to the transfer. In any event, given that the Complainant resigned prior to the transfer, no rights or obligations in respect of the alleged contravention transferred to the Respondent.

The Respondent relied upon the case of Grosvenor Cleaning Services Limited -v- SIPTU DWT0440 which confirmed that Regulations could not enable a transferor to avoid liability for contraventions of statutory duty that had occurred prior to the transfer. It was submitted therefore that any such liabilities as are alleged in this case do not and could not transfer to the Transferor.

CA-00020033-002 – Complaint under the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003

The Complainant claims that the Respondent, Mr. B (the Transferee) has contravened the provisions of Regulation 4(1) by failing to observe the terms and conditions that she was entitled to in relation to her employment with Ms. A (the Transferor).

In considering this matter, I am satisfied that the following material facts have been established, namely:

·         The Complainant was employed by the Respondent from 20 May, 2016 until 6 April, 2018 and was working in the position of Crèche Manager when her employment was terminated.

·         The business transferred to the Respondent, Mr. B, by way of a transfer of undertakings on 9 April, 2018.

·         The Respondent engaged with Ms. A (the Transferor) in relation to the sale of the business for a significant period prior to the transfer and the Complainant was fully aware that the transfer would be taking place several weeks prior to transfer date.

·         The Complainant had a meeting with the Respondent and Ms. A (the Transferor) on 6 April, 2018 and there was discussion in relation to the Complainant’s existing terms and conditions of employment.

·         The Complainant informed both the Respondent and Ms. A (the Transferor) by e-mail on 7 April, 2018 that she would not be transferring to the employment of the new owner following the transfer of undertakings. The Complainant’s employment did not subsequently transfer to Mr. B following the transfer of the business on 9 April, 2018.

·         The Complainant’s employment with the Transferor, Ms. A, terminated on 6 April, 2018 and she was issued with a P45 on this date.

EU Directive 2001/23/EC (“the Directive”), transposed into domestic law by the Regulations, provides in the first paragraph of Article 3(1) thereof, that “The transferor’s rights and obligations arising from a contact of employment or from an employment relationship existing on the date of a transfer shall, by reason of such transfer, be transferred to the transferee”.The aforementioned provision of the Directive is transposed by Regulation 4(1) of the Regulations which provides as follows:

“4. Rights and obligations

(1) The transferor's rights and obligations arising from a contract of employment existing on the date of a transfer shall, by reason of such transfer, be transferred to the transferee.”

I note that the European Court of Justice in the case of Mikkelsen -v- Danmols Inventar A/S C-105/84 heldthat: “the protection which the Directive is intended to guarantee is however redundant where the persons concerned decides of his own accord not to continue the employment relationship with the new employer after the transfer. That is the case where the employee in question terminates the employment contract or relationship of his own free will with effect from the date of the transfer or where that contract or relationship is terminated with effect from the date of the transfer by virtue of an agreement voluntarily concluded between the worker and the transferor or the transferee of the undertaking. In that situation Article 3(1) of the Directive does not apply”.

Having regard to the totality of the evidence adduced, I am satisfied that the Complainant was fully aware that the business was transferring to the Respondent, Mr. B, by way of a transfer of undertakings with effect from 9 April, 2018. I am further satisfied that there had been ongoing communication between the Complainant and the Transferor (Ms. A) in relation to the transfer of the business during the weeks prior to the transfer date. It is clear that there was a meeting between the Complainant, the Respondent (Mr. B) and the Transferor (Ms. A) on 6 April, 2018 in relation to the transfer and that matters concerning her terms and conditions of employment were discussed by the parties. I am satisfied that the Complainant was provided with assurances by the Respondent, Mr. B, both verbally at this meeting on 6 April, 2018 and by e-mail on 7 April, 2018 that her employment would continue on the same terms and conditions following the transfer of the business. I find that the Complainant decided not to transfer to the employment of the Respondent, Mr. B of her own volition, and therefore any rights or obligations arising from her contract of employment with the Transferor did not transfer to the Transferee.

In the circumstances, I find that the Respondent did not contravene the Complainant’s rights under Regulation 4 of the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003.

CA-00020033-003 – Complaint under the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003

It was not clear from the information contained on the Complainant’s Complaint Referral Form as to whether she was seeking redress in relation to an alleged contravention of Regulation 7 and/or Regulation 8. Having considered the evidence and submissions made by the Complainant, I am satisfied that the complaint relates to an alleged contravention in relation to Regulation 8.

The Complainant claims that the Respondent i.e. the Transferee has contravened the provisions of Regulation 8 of the Regulations by failing to consult with her and to provide her with the required information in relation to the transfer of the business.

Regulation 8 provides for an information and (where applicable) a consultation process with employees’ representatives as opposed to any form of direct communication with individual employees on a one-to-one basis. Regulation 8(6) provides that where there are no representatives of the employees in an undertaking or business through no fault of their own, the employees concerned must be informed in writing in advance of the transfer of certain specified matters relating to the transfer.

It was not in dispute between the parties that a transfer of undertakings occurred within the meaning of the Regulations on 9 April, 2018 in the circumstances of the present case. I am satisfied that the Complainant’s employment with the Transferor terminated on 6 April, 2018 and therefore, her contract of employment did not transfer to the Respondent, Mr. B (the Transferee) on 9 April, 2019.

Therefore, the question arises as to whether or not the Transferor and Transferee are jointly and severally liable for a contravention of Regulation 8 in respect of obligations which arose before the date of transfer from a contract of employment which did not transfer. The second paragraph of Article 3(1) of the Directive includes an optional provision which permits a Member State to derogate from the strict terms of the first paragraph of Article 3(1) as follows:

“Member States may provide that, after the date of transfer, the transferor and the transferee shall be jointly and severally liable in respect of obligations which arose before the date of transfer from a contract of employment or an employment relationship existing on the date of the transfer.”

It is clear that the State has not chosen to transpose into domestic legislation this optional provision in relation to joint and several liability. That being the case, I take the view that in circumstances where the Complainant’s contract of employment did not transfer that any liability for the alleged failure to comply with the information and consultation obligations in the Complainant’s case can only rest, pursuant to the Regulations, with the Transferor.

Accordingly, I find that the Respondent cannot be held liable for any alleged contravention of the Complainant’s rights under Regulation of the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003.

CA-00020033-002 – Complaint under the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003

I find that the Respondent did not contravene the Complainant’s rights under Regulation 4 of the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003. Accordingly, I find that the complaint is not well founded.

CA-00020033-003 – Complaint under the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003

I find that the Respondent cannot be held liable for any alleged contravention of the Complainant’s rights under Regulation of the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003. Accordingly, I find that the complaint is not well founded.

European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003 – Regulation 4 – Regulation 8 – Complaint Not Well Founded