Complainant

Respondent

Anonymised Parties

A Sales Executive

A garden products supplier.

Act

Complaint/Dispute Reference No.

Date of Receipt

Complaint seeking adjudication by the Workplace Relations Commission under section 7 of the Terms of Employment (Information) Act, 1994

CA-00025022-009

15/01/2019

Complaint seeking adjudication by the Workplace Relations Commission under Regulation 18 of the European Communities (Road Transport)(Organisation of Working Time of Persons Performing Mobile Road Transport Activities) Regulations 2012 - S.I. No. 36/2012

CA-00025022-010

15/01/2019

Complaint seeking adjudication by the Workplace Relations Commission under Section 8 of the Unfair Dismissals Act, 1977

CA-00025022-011

15/01/2019

Complaint seeking adjudication by the Workplace Relations Commission under Section 11 of the Minimum Notice & Terms of Employment Act, 1973

CA-00025022-012

15/01/2019

Complaint seeking adjudication by the Workplace Relations Commission under Section 11 of the Minimum Notice & Terms of Employment Act, 1973

CA-00025022-013

15/01/2019

Complaint seeking adjudication by the Workplace Relations Commission under Section 11 of the Minimum Notice & Terms of Employment Act, 1973

CA-00025022-014

15/01/2019

The Complainant worked for the Respondent from 28/09/2016 until 26/10/2018.

This complaint was received by the Workplace Relations Commission on 15/01/2019.

A preliminary issue in relation to the complainant’s employment status took place prior to hearing the complaints listed.

BACKGROUND

The Complainant has set out the background to his complaint to the WRC by letter dated 17th February 2019. The following additional matters are relevant to the background as set out therein:

The Complainant registered his own company in 2015 to handle claims and risk management and traded for this purpose up until September 2016. When the Complainant commenced his employment with the Respondent in September 2016 he was requested to invoice by Mr McN and he used this company to raise invoices.

The Complainant was not provided with a contract or any written agreement in relation to his role with the Respondent whether when engaged or at any time thereafter.

From the initial engagement it was made clear that the Complainant was joining the Sales Team.   By email of 28th September KP announced:

“I would like to announce that xxxxx xxxxxxx just joined our sales team in Ireland …Welcome on board xxxxx from Dublin J”

The Complainant received welcome emails from colleagues in response including:

“Welcome to the land of xxxxx”.

It was not represented at any stage that the Complainant was a contractor and there was no indication that he was joining the Respondent organisation as anything other than a member of the team.

The Complainant was paid on a commission only basis for which he provided an invoice each month, which was discharged each month by the Respondent. However, depending on whether customers had paid, some payments would fall into the next month. A retainer would be paid half way through the month and then deducted from the total commission earned.

The Complainant was fully integrated with the Company. His picture remains on the Respondent’s website. He was required to wear the Respondent’s uniform (company shirt with his name and title and a leather green gilet/waistcoat with Respondent branding, which he is seen wearing on the Internet page, at Trade shows and in the marketing video). At the trade show in October 2018 the Respondent dictated his clothing.   The Complainant’s business cards identified him as an employee of the Respondent. He is featured on the website and Facebook page regularly as part of the team, including one post on his birthday where he is referred to “our very own gardening specialist, xxxxxxxxxxxx (the Complainant was named).

Further to the foregoing, the Complainant was represented to customers as being part of the team as evidenced from customer reviews. He was identified as working with the Respondent as a Senior Sales Executive when he requested a character reference from the Managing Director.

The Complainant was provided with all equipment and tools required to do his job by the Respondent. He was provided with a Company car that was covered in artificial grass and a fuel card.   He was also covered under the Respondent’s insurance policy to drive all company vehicles and was required to hold and provide a copy of his full driving licence to the Respondent upon commencement. All parking was paid for by the Respondent.

He was also provided with a mobile telephone, an I-Pad, and SIM card. He was fully integrated into the Respondent’s ICT systems including email and CRM system and Visibook account to manage his diary. He was also provided with a payment terminal (SumUp) for accepting deposits.   He was provided with a drone for taking aerial shots of gardens.

All samples, brochures and marketing material were provided by the Respondent.

The Complainant did not provide any tools or equipment whatsoever. If as happened on occasion, he was required to purchase any such items, such as for example tape measures, he was fully reimbursed by the Respondent.

When he attended the annual conferences in the UK, flights and accommodation were paid by the Respondent.

The Complainant was required by the Respondent to attend a meeting every Friday morning.   It is very apparent from the email minutes of the meetings that the Complainant was part of the “Respondent team”. He received all leads from the Respondent either at these meetings or otherwise through their systems. It is clear that all of his duties / activities were directed and controlled by the Respondent.

The Complainant was not provided with a Company Handbook or notified of a grievance procedure or otherwise notified of any way to address disputes within his workplace at any time prior to October 2018.

The Complainant has set out the circumstances surrounding his dismissal, summarised as follows:

He was required to work at a Trade Show from 26th October 2018

He received a text message at 9pm on 25th October instructing him to wear a suit and blue tie to the Trade Show. He did not own a blue tie and was not given any notice in order to acquire one. When he arrived without a blue tie, Mr McN became annoyed and unreasonably reprimanded the Complainant.

The Complainant thereafter sought payment for the Trade Show. The Respondent told him that if that was his attitude “he could f*** off”.

It is not accepted that this was normal banter in the workplace and the Complainant was deeply offended. The Complainant was not prepared to accept this unreasonable conduct and left the Trade Show handing back his company car keys and some other Company property.

However, following the Trade show, the Complainant sought to engage with Mr McN and “reached out” to him to address the matter.   However, Mr McN refused to engage with him and instead asserted that the Complainant was not an employee.   It was only after the Complainant’s employment terminated that the Respondent asserted for the first time that he was not an employee.

The Complainant made a request for an insurability decision to SCOPE section of Department of Employment Affairs and Social Protection. The decision issued on 10th April 2019 and found that the Complainant was an employee of the Respondent. Following investigation, the Deciding Officer found that:

“Having considered all the available evidence on file in this case, I have concluded that the Complainant was employed under a contract of service and that a normal employer/employee relationship exists in this case”.

LEGAL SUBMISSION

Employment Status

It is alleged by the Respondent that the Complainant was not an employee. In this regard, it is accepted that the Complainant was paid by submitting invoices to the Respondent on a monthly basis and that the Complainant looked after his own Tax and PRSI and it is submitted the Respondent deliberately sought to designate the Complainant as self-employed and that this, in the words of the Bill currently before the Dail was “Bogus Self Employment”.

As there was no written contract whatsoever between the parties, it is submitted that the Adjudication officer must examine the totality of the relationship between the parties. It is submitted that the payment arrangements were not determinative of the Complainant status and that in fact the circumstances overwhelmingly demonstrate that the Complainant was employed on a contract of service.

The law on this matter is extensive and complex. The Respondent has sought to rely on the case of Henry Denny & Sons (Ireland) Ltd v Minister for Social Welfare. It is of note that the Respondent has deliberately deleted the relevant part of the quotation cited, thereby fundamentally changing its meaning. The said quotation should read:

… The inference that the 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 provides others to assist in the business and where the profit which he or she derives from the business is dependent on the efficient with which it is conducted by him or her…

The underlined section was omitted in that cited on behalf of the Respondent and it is submitted is of most relevance to the within case, in circumstances where the Complainant did not provide any premises, equipment or other form of investment and did not provide others to assist in the business.

It is submitted therefore that the decision of the Supreme Court in the case of Henry Denny & Sons is of far greater assistance to the Complainant than to the Respondent and the Complainant relies on the decision in its entirety in which Keane J (as he then was) quoted with approval the following passage from the judgment of Cook J in Market Investigations:

“The observations of Lord Wright, of Denning L. J and of the judges of the Supreme Court suggest that the fundamental test to be applied is this. “Is the person who has engaged himself to perform these services performing them as a person in business on his own account”. If the answer to that question is “yes” then the contract is a contract for services. If the answer is “no” then the contract is a contract of service. No exhaustive list has been compiled and perhaps no exhaustive list can be compiled of considerations which are relevant in determining that question, nor can strict rules be laid down as to the relative weight which the various considerations should carry in particular cases. The most that can be said is that control will no doubt always have to be considered although it can no longer be regarded as the sole determining factor; and that factors which may be of importance are such matters as whether the man performing the services provides his own equipment, whether he hires his own helpers, what degree of financial risk he takes, what degree of responsibility for investment and management he has, and whether and how far he has an opportunity of profiting from sound management in the performance of his task”.

From that passage Keane J concluded as follows:

“It is, accordingly clear that, while each case must be determined in the light of its particular facts and circumstances, 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 the 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”.

In the case of Western People Newspaper v A Worker, cited by the Labour Court in the April 2019 Determination in the case of Wall v Nowacki, the Court examined the complexity surrounding the distinction between a Contract of service and a contract for service stating:

Contract of Service / Contract for Service

The process of determining if a person works under a contract of employment or is self-employed must be approached in two stages. The first stage requires the Court to decide if the alleged employer is contractually obliged to provide the person claiming to be an employee with work which that person is then required to perform. This mutuality of obligations has often been referred to as the irreducible minimum requirement which must be present before a contract of employment can be held to exist.

The second stage in the process requires a determination as to whether the contract binding the parties is one of service or one for service.   The fundamental test for determining this question was set down in the English decision of Market Investigations v Minister of Social Security [1969] 2 Q.B. 173. Here it was held that the Court should consider if the person was performing the service as a person in business on his own account. If the answer to that question is yes, then the contract is one for service. If the answer is no, then the contract is one of service.

In the Western People Newspaper case, the Court went on to consider the tests involved in classifying the relationship as follows:

If it is accepted that a contractual relationship existed between the parties, consideration should now turn to the correct classification of that relationship. In considering the second stage of the test (is that contract one of service) the following considerations are relevant.

Control

Integration Test

The extent to which a person works as part of a business and is an integral part of the business is a further consideration. This was the test applied by Carroll J in in re Sunday Tribune. The respondent contends that since the complainant did not attend meeting or attend at the respondent’s offices he was not interrogated into the business.   This could not be a decisive factor since home workers, who are generally regarded as employees would in many instances be in a similar position. Moreover, advances in communication technology would have lessened the need for working journalists to attend at their employer’s place of business.

Entrepreneurial Test

This line of argument ignores the underlying object of the various elements of this test. Its purpose is to help in establishing if, on its true construction, the contract at issue is one made between two parties in business on their own account or between an enterprise and an individual selling his own skill in the serviced of that enterprise. In applying the test regard should be had to the reality of the situation envisaged by the contracting parties rather than to theoretical possibilities.

It is submitted by the respondent that, since the complainant incurred certain expenses (such as telephone calls, travel and internet costs) in researching his article he was in a position to maximise profits and minimise loss …The position of the complainant in this respect is no different to any worker who works from home … Further the test postulates the possibility of the “employee” being authorised to employ an assistant to help speed up the work and maximise profit. This is entirely different to the possibility of the complainant obtaining the gratuitous assistance of another party to assist him with some aspect of his research. Given the level of remuneration paid to the complainant it could not be seriously suggested that he could employ assistance. It is finally argued that the complainant is free to work for other newspapers and that this is indicative of a contract for service. Two points arise here. The complainant is not a career freelance journalist trading his copy between newspapers and there is nothing to suggest that the contract between the parties was concluded in that context. Secondly any employee can have a second or third job and this has no bearing on their employment status in any one of them. In that regard it is noteworthy that, as appears from the Judgement of Carroll J, the regular columnist held to be an employee in In Re Sunday Tribune, also worked for London Weekend Television and for the New Statesman.

Payment

The complainant was paid on foot of an invoice without deduction of PAYE or PRSI. In the Denny case the Demonstrators were paid a fee in respect of each demonstration provided. As appears from the Judgement of the Supreme Court, each demonstrator submitted an invoice and payment was made each fortnight without deduction of tax or PRSI. They were nonetheless held to be employees ….

Working Hours

The Complainant was free to determine his own working hours.   This again was not decisive.

The Labour Court further stated

Following the decision of the Supreme Court in Henry Denny & Sons v Minister for Social Welfare [1998] IR 34 and in Tierney v An Post [2000] 1 IR 536 there is now a single composite test for determining if a person is engaged on a contract of service or a contract for service. That involves looking at the contract as whole and asking is the person in business on his or her own account. If the answer to that question is yes, the contract is one for service. If it is no, the contract is one of service. The question of control and integration should no longer be regarded as automats tests in themselves but as elements to be taken into account in applying the enterprise test.

In Milnes v Dublin Bus Coast Bus there was no written contract between the parties and the Court held that there was a mutuality of obligation, despite the employee in that case being one of a group of actors who were required to ensure that between themselves that just one of them was available on all the occasions required by the employer, not being required to ensure that he was personally available on all such occasions.

In the case of Hassett v Udaras Na Gaeltachta, the Tribunal considered factors such as hours of work, use of equipment, that the Complainant had a list of jobs and tasks to carry out and never engaged in other work, in holding him to be an employee.

Having regard to the foregoing, it is submitted that the Complainant’s work diaries and the follow up emails from the Friday morning meetings make it clear that there was mutuality of obligation between the parties. There was one continuing and enduring contract between the parties, not a series of contracts related to individual assignments.

It is further submitted that it is clear in all of the circumstances notwithstanding the payment arrangements that the Complainant was not performing the service as a person in business on his own account. He did not make any investment or take any financial risk.   Although he could improve his earnings through increased sales leading to increased commission this would be the case for any employee who has a performance related or commission element to their pay. The rate of commission was set by the Respondent and the Complainant did not have any bargaining power in that regard. The Complainant did not supply any tools or equipment for the service.   It is submitted that this is sufficient to ascertain that the Complainant was employed on a contract of service.

However, for the avoidance of doubt it is submitted that if the circumstances are characterised under the control, integration or entrepreneurial test, the same outcome is achieved.

Finally, the decision of the deciding officer of the SCOPE section of the Department, following full investigation is persuasive of the Complainant’s employment status and it is therefore submitted beyond doubt that the Complainant was employed on a contract of service and that the Adjudication Officer has jurisdiction to hear the complaint.

Complaint under the Unfair Dismissals Acts 1977 to 2017

It is submitted that the Complainant was unfairly dismissed within the meaning of the Unfair Dismissals Acts.

The definition of dismissal in section 1 of the said Act includes the definition for constructive dismissal as follows:

“the termination by the employee of his contract of employment with his employer whether prior notice of the termination was or was not given to the employer, in circumstances in which because of the conduct of the employer the employee was or would have been entitled or it was or would have been reasonable for the employee to terminate the contract of employment without giving prior notice of the termination to the employer”.

It is submitted that the Complainant was constructively dismissed in the circumstances where the conduct of the Respondent was so unreasonable that the Complainant could no longer be expected to put up with it and he was therefore justified in leaving.   The Respondent had required the Complainant to work without payment and then told him to f*** off when he sought to address this matter.

The Adjudication Officer is also asked to examine the conduct of the parties following the incident at the Trade Show. The incident involved the owner / Managing Director of the Respondent Company.   There was no internal process or procedure that could be utilised by the Complainant to raise a grievance or otherwise address what had occurred. The Complainant instead “reached out” to Mr McN to resolve the matter but the only response he received was that he was not an employee.   The Complainant therefore took all steps within his power to resolve matters but the Respondent simply refused to engage and made it very clear that his employment had ended by removing his access to the computer systems.

Without prejudice and in the alternative, if necessary, it is submitted that the Respondent dismissed the Complainant in telling him to “f*** off” removing his access from the computer system including email and refusing to engage with him thereafter.

In the case of a Chef v a Restaurant (ADJ – 00007884) the Adjudication Officer in finding for the Complainant held:

“on the balance of probabilities, it is more likely that he left his employment because he was told to “f*** off”. The payslips produced corroborate the complainant’s evidence that all was not above board in relation to the respondent’s tax affairs.   On that basis I find that the complainant was dismissed from his employment and that dismissal was unfair within the mean of the Acts”.

There was a similar finding in Employee v a Transport Company (ADJ – 00000157)

The Complainant took all possible steps to mitigate his loss and will give further evidence thereof at the hearing.

Complaint under the Terms of Employment (Information) Act 1994

The Complainant was not provided with a contract or any written agreement in relation to his role with the Respondent whether when engaged or at any time thereafter in breach of the said Act.

Complaint under the Minimum Notice Act

The Complainant did not receive any payment in lieu of notice upon the termination of his employment.

The Complainant reserves the right to adduce such further evidence as may be necessary and/or to make further submission at or after the hearing of the matter.

The Respondent is a supplier and installer of artificial grass.

The Complainant was the principal of his own registered company (company xxxx) based in Dublin.

Company xxxx was engaged by the Respondent to provide a salesperson.

It was agreed that Company xxxx would be paid a commission for any sales made by its sales person. Company xxxx provided the Complainant. Company xxxx invoiced for Commission at the agreed rate of 10% per sale minus a retainer amount of €1,431.72. The Claimant was never an employee of the Respondent.

The Complainant makes the following claims:

a. Unfair Dismissal;

b. Terms and Conditions of Employment

c. Terms and Conditions of Employment – a claim under Regulation 18 of the European Communities (Road Transport) (Organisation of Working Time of Persons Performing Mobile Road Transport Activities) Regulations 2012

d. 3 unspecified claims for Minimum Notice

The Respondent denies each of the above claims. In particular the Respondent submits that the Claimant was never an employee of the Respondent business. Additionally, the Respondent submits:

a. In relation to the Claim of Unfair Dismissal, the Claimant was never dismissed. If the Claimant is claiming Constructive dismissal, there was no breach of a fundamental term nor any behaviour that was so unreasonable as to permit the Claimant to consider himself to be dismissed.

b. Terms and Conditions of Employment – The Claimant was not an employee of the Respondent. The Claimant did not seek terms and conditions at any stage.

c. Terms and Conditions of Employment Road Transport – The Claimant was not an employee of the Respondent.

d. Minimum Notice – The Claimant was not an employee of the Respondent and thus had no entitlement to minimum notice.

The Respondent relies on the following authorities in support of its contention that the Claimant was not its employee: a. McKayed v Forbidden City t/a Translations.ie [2016] IEHC 722

b. ADJ-13260 Driver v Transport and Courier Service

c. Code of Practice for Determining Employment or Self Employment, Employment Status Group, Programme for Prosperity and Fairness, 2017

The Respondent submits that the relationship between the Complainant and Respondent was characterised by the following features: Company xxxx invoiced for the services of the Complainant on a Commission-Retainer basis. Company xxxx charged VAT on these invoices.

The Respondent was under no obligation to provide any work to the Complainant nor was the Complainant under any obligation to complete any work provided to him.

The Respondent understands that the Complainant, as principal of Company xxxx applied deductions for capital spending in respect of expenses incurred while servicing the Respondent in order to reduce its tax bill.

The Respondent did not pay PAYE or PRSI in respect of the Complainant. No P45, P60 or payslips have been produced in respect of the Complainant.

Company xxxx could have supplied any sales person to service the Respondent’s business requirement.

The Complainant took holidays and was not paid by the Respondent for annual leave. The Complainant was not paid any additional money or paid for a day off in respect of bank holidays.

The Complainant never raised any issue about the fact that he was not provided with a payslip, P45, P60, or that he wasn’t paid for annual leave or bank holidays.

The Complainant was in control of his own time.

The Complainant worked from his own office.

While the Complainant was provided with a Company car, this was a marketing tool (it was covered in grass). The Complainant was not obliged to use it. The Complainant was also provided with an iPad, this was so he could easily receive details of orders through the OnePage CRM system. The Complainant was provided with a uniform for the purpose of being recognisable as a member of the company only.

The Facts:

1. The Respondent began to use the Complainant’s services on 28th September 2016.

2. The Complainant was given company car as the Respondents cars are used for advertisement which could result in direct profit for the Claimant.

3. The Complainant was paid commission of 10% of all deals he closed, he was never on an hourly or salaried rate where as sales people who were employees were on set salaries.

4. The Complainant worked in his own office and was only required to come into the Respondents building once per week for the weekly meetings.

5. The Complainant could have sent other people in his place as he was only engaged to get a certain job done and the Respondent didn’t mind who did the work just once it was done.

6. There was no mutuality of obligation between the Complainant and the Respondent.

7. The Complainant was paid through monthly invoices.

8. The Complainant had to do his own taxes and it is understood that he deducted appropriate capital expenses from these for tax purposes.

9. The Claimant controlled his own schedule and diary.

10. The Claimant could take holidays, he was never paid any annual leave. Nor was he paid for bank holidays.

11. On at least 4 occasions the Complainant had, in the course of informal meetings with Ms KP, said that he was leaving and had handed in his keys, iPad and so on. This had also occurred during 3 meetings between May and September where he had walked out saying ‘ah f*** off, I’m sick of this s***’ and again leaving his phone, keys etc before returning for them shortly later.

12. The Complainant’s role involved selling products, measuring up gardens, pricing projects, flyer drops and attending sales conferences.

13. In April 2017, the Complainant was requested to attend a trade show on behalf of the company.

14. The Complainant had not worked with us very long at this point so did not have much capital. He was concerned that he wouldn’t have enough money to hire someone to mind his children in his absence. The MD gave the Complainant €120 to ensure that he could have someone look after his kids while he was at the trade show.

15. At the Ideal Home show in October 2018, the same issue arose regarding the childcare but the MD did not give any money towards childcare in this instance as the Complainant had been working for a substantial amount of time by now.

16. Uniforms were meant to have arrived on the day prior to the first day of the Ideal Home show. The uniforms did not arrive until the evening of the day the show begun.

17. The Complainant, along with all others attending the show, were asked to wear a white shirt and a blue tie on the first day of the show so that there was some form of uniform.

18. The Complainant did not bring up any issues on this until the morning of the show where he said he did not want to wear a tie.

19. The picture in which the Complainant has submitted of the show is taken on the second day at the show where the uniforms with the logo and did not include a tie.

20. The Complainant was also unhappy about not being paid for his time at the Ideal Home show, but the show was to increase sales which would directly affect on the Complainant’s potential income.

21. At the trade show, the Complainant expressed his unhappiness and the MD said to the Claimant something along the lines of ‘well if you are that unhappy, maybe you should just f*** off’. The Respondent submits that this would be normal talk that went both ways within the sales team.

22. The Complainant subsequently left the trade show leaving back his keys and his work iPad seemingly not planning on providing service for the Respondent any longer.

23. The Respondent proceeded to remove the Claimants name from the work systems including the OnePageCRM.

24. The MD met with a Social Welfare Inspector working on behalf of the Claimant on 29th January 2019 to fill in necessary forms they needed to prove that the Claimant is in fact self-employed.

25. In the case of Minister for Agriculture v Barry [2008] IEHC 216 the High Court noted that mutuality of obligation is an ‘important filter’ in that its absence meant the court need not go further in examining the relationship, but it’s existence could not be determinative of the issue.

26. In the case of Henry Denny & Sons v Minister for Social Welfare [1997] IESC 9 it was said that ‘The inference that the person is engaged in business on his or her own account can be more readily drawn…. 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.’

27. In summary, the court does not have jurisdiction to hear this claim as the Claimant was not employed by the respondent.

 In the Alternative:

28. In the alternative, should the adjudication officer find that the Complainant is in a contract of services, the Respondent submits that the Complainant was not constructively dismissed.

29. In the case of Western Excavating (ECC) Ltd v Sharp [1978] IRLR 27 it set out something called the contract test. This is summarised as “If the employer is guilty of conduct which is a significant breach going to the root of the contract of employment, or which shows that the employer no longer intends to be bound by one or more of the essential terms of the contract, then the employee is entitled to treat himself as discharged from any other performance.” They also set out a ‘reasonable’ test. This is to evaluate whether the employer ‘’conducts himself or his affairs so unreasonably that the employee cannot fairly be expected to put up with it any longer, if so the employee is justified in leaving.”

30. In this case, the employer didn’t conduct himself in a way which would justify the actions of the Claimant.

31. The Complainant in this case never sought to solve any issues through internal procedures such as a grievance procedure. In UD1350/2014 M Reid v Oracle EMEA Ltd the EAT stated; “It is incumbent on any employee to utilise and exhaust all internal remedies made available to him or her unless he can show that the said remedies are unfair”.

32. The Complainant submits that he did not receive a contract of employment but seeing as the Complainant was not an employee he would not be entitled to receive a contract of employment.

33. The Complainant submits that the Respondent did not keep statutory employment records, we are unaware of what records the Complainant is referring to so cannot submit on this point.

34. The Complainant submits that he did not receive a notice period or any rights during this notice period but seeing as the Complainant terminated his own employment without notice, these claims cannot be substantiated.

In the Alternative/Mitigation:

35. In the alternative, should the adjudication officer find that the Complainant was constructively dismissed, which is denied, it is noted that the Respondent submits that they were only without employment for a period of 2 months therefore they were not huge losses incurred.

36. The Respondent also submits that the Claimant has not shown his actions as to how he tried to mitigate that loss. We need to uncover could he have found alternative work in a reasonable amount of time with a higher wage.

37. The Respondent submits that it is incumbent upon the claimant to seek to mitigate his losses between period of employment as per Section 7(2)(c) of the Act. “Without prejudice to the generality of subsection (1) of this section, in determining the amount of compensation payable under that subsection regard shall be had to—

(c) the measures (if any) adopted by the employee or, as the case may be, his failure to adopt measures, to mitigate the loss aforesaid,”

38. The Respondent refers to the decision of Coad v Eurobase (UD1138/2013) where the Tribunal noted, “In calculating the level of compensation the Tribunal took into consideration the efforts of the claimant to mitigate his losses’’.

Conclusion:

39. It is submitted that the Claimant was not an employee of the Respondent.

40. It is submitted that the Claimant was not constructively dismissed.

41. The Respondent denies all claims.

There are two questions to be answered:

1.       Was the Complainant employed by the Respondent?

2.       If so, was he dismissed or constructively dismissed from this employment?

On the subject of employment status both representatives have extensively quoted from case law. With reference to the Henry Denny & Sons (Ireland) Limited v Minister for Social Welfare [1998] 1 IR 34,I note that the Respondent’s representative has quoted as follows:

‘The inference that the person is engaged in business on his or her own account can be more readily drawn…. 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.’

The Complainant’s representative has noted that the Respondent has deliberately deleted the relevant part of the quotation cited, thereby fundamentally changing its meaning. The said quotation should read:

… The inference that the 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 provides others to assist in the business and where the profit which he or she derives from the business is dependent on the efficient with which it is conducted by him or her…

The Respondent’s representative asserts that the decision of the Supreme Court in the Henry Denny& Sons, is of far greater assistance to the complainant than to the Respondent.

The Henry Denny & Sons (Ireland) Limited vMinister for Social Welfare judgement has to be looked at in more detail where Keane J quoted from the judgement of Cook J in Market Investigations v Minister of Social Welfare [1969] 2 Q.B 173:

“The observations of Lord Wright, of Denning L. J and of the judges of the Supreme Court suggest that the fundamental test to be applied is this. “Is the person who has engaged himself to perform these services performing them as a person in business on his own account”. If the answer to that question is “yes” then the contract is a contract for services. If the answer is “no” then the contract is a contract of service. No exhaustive list has been compiled and perhaps no exhaustive list can be compiled of considerations which are relevant in determining that question, nor can strict rules be laid down as to the relative weight which the various considerations should carry in particular cases. The most that can be said is that control will no doubt always have to be considered although it can no longer be regarded as the sole determining factor; and that factors which may be of importance are such matters as whether the man performing the services provides his own equipment, whether he hires his own helpers, what degree of financial risk he takes, what degree of responsibility for investment and management he has, and whether and how far he has an opportunity of profiting from sound management in the performance of his task”.

From that passage Keane J concluded as follows:

“It is, accordingly clear that, while each case must be determined in the light of its particular facts and circumstances, 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 the 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”.

Contract of Service / Contract for Service.

The process of determining if a person works under a contract of employment or is self-employed must be approached in two stages. The first stage requires a decision on whether the alleged employer is contractually obliged to provide the person claiming to be an employee with work which that person is then required to perform. This mutuality of obligations has often been referred to as the irreducible minimum requirements which must be present before a contract of employment can exist.

The second stage in the process requires a determination as to whether the contract binding the parties is one of service or one for service. The fundamental test for determining this question wasset down in the English decision of Market Investigations v Minister for Social Security [1969] 2 Q.B 173.Here it was held that the Court should consider if the person was performing the service as a person in business on his own account. If the answer to that question is yes, then the contract is one for service. If the answer is no then the contract is of service.

In the instant case there is no written contract. During the SCOPE (Department of Employment Affairs and Social Protection) investigation both the Complainant and Respondent MD were interviewed by inspectors, it was established that the Complainant supplied labour only. All items required to do the job were provided by the Respondent including a company car, phone, laptop, computer system, branded uniform etc. The Complainant was subject to the control of the Respondent as to the provision of work that was carried out and was provided with the leads to carry out his role of Sales Executive. There is no evidence on file showing that the Complainant ever turned down work when it was presented to him and he was working consistently for the Respondent.

When established that that a contractual relationship existed between the party’s consideration must now be given to the correct classification of that relationship. In considering the second stage of the test the following considerations are relevant:

Control Test.

It is clear from the authorities that the degree of control exercised over the worker is a relevant indicator of a contract of service. Traditionally the control test involved ascertaining the extent to which the employer could direct the operation and determine how it was to be done and when it was to be done. It has, however diminished in significance over time. As was pointed out by Walsh J in Roche v Kelly [1969] IR100, it is the right to control the work rather than the actual exercise of that right that matters.

The respondent did not determine when the work was to be done in that the complainant could decide his own hours of work. In that respect he was in the same position as any other “home worker” who could determine their own hours of work provided certain deadlines were met.   In Nethermere (St Neots) v Taverna and Gardiner [1984] IRLR240, the employment status of the respondents was at issue. They were garment workers who worked from home. They had no fixed hours for doing the work and could determine the volume of work which they wished to take in. They were paid according to the number of garments produced. It was held by the Court of Appeal that they were employed under a contract of service.

Integration Test.

The extent to which a person works as part of a business and is an integral part of the business is a further consideration.

In this instant case the Complainant was required to attend weekly meetings and was introduced to colleagues and customers as part of the team. He was fully integrated into the Respondent’s ICT systems including email and CRM system and Visibook account to manage his diary.   He was also provided with a payment terminal (SumUp) for accepting deposits. He was provided with a drone for taking aerial shots of gardens.

Entrepreneurial Test.

An important factor in determining whether a person is an independent contractor is the degree of responsibility and opportunity for investment and management that he has.   In Henry Denny & Sons(Ireland) Ltd v Minister for Social Welfare the Supreme Court considered that among the factors pointing to Ms Mahon a shop demonstrator for Henry Denny being an employee were that her earnings from Henry Denny were determined exclusively by the extent to which her services were availed of by Denny and that she could not increase her profit by better management and employment of resources.

In this instant case the Complainant was paid 10% commission on all sales – this was determined by the Respondent.

Revenue.

The material from Revenue provides a Code of Practice for Determining Employment or Self-Employment Status of Individuals. This document provides criteria on whether an individual is an employee or is self-employed:

Criteria on whether an individual is an employee.

While all of the following factors may not apply, an individual would normally be an employee if he or she:

·         Is under the control of another person who directs as to how, when and where the work is to be carried out.

·         Supplies labour only.

·         Receives a fixed hourly/weekly/monthly wage.

·         Cannot subcontract the work. If the work can be subcontracted and paid on by the person subcontracting the work, the employer/employee relationship may simply be transferred on.

·         Does not supply materials for the job.

·         Does not provide equipment other than the small tools of the trade. The provision of tools or equipment might not have a significant bearing on coming to a conclusion that employment status may be appropriate having regard to all the circumstances of a particular case.

·         Is not exposed to personal financial risk in carrying out the work.

·         Does not assume any responsibility for investment and management in the business.

·         Does not have the opportunity to profit from sound management in the scheduling of engagements or in the performance of tasks arising from the engagements.

·         Works set hours or a given number of hours per week or month.

·         Works for one person or for one business.

·         Receives expense payments to cover subsistence and/or travel expenses.

·         Is entitled to extra pay or time off for overtime.

Additional factors to be considered

·         An individual could have considerable freedom and independence in carrying out work and still remain an employee.

·         An employee with specialist knowledge may not be directed as to how the work is carried out.

·         An individual who is paid by commission, by share, or by piecework or in some other atypical fashion may still be regarded as an employee.

·         Some employees work for more than one employer at the same time. Some employees do not work on the employer’s premises.

·         There are special PRSI rules for the employment of family members.

·         Statements in contracts considered by the Supreme Court in the “Denny” case such as “You are deemed to be an independent contractor”, “It shall be your duty to pay and discharge such taxes and charges as may be payable out of such fees to the Revenue Commissioners or otherwise”, “It is agreed that the provisions of the Unfair Dismissals Act 1977 shall not apply etc”, “You will not be an employee of this company”, “You will be responsible for your own tax affairs” are not contractual terms and have little or no contractual validity While they may express an opinion of the contracting parties, they are of minimal value in coming to a conclusion as to the work status of the person engaged.

Criteria on whether an individual is self employed

While all the following factors may not apply to the job, an individual would normally be self employed if he or she:

·         Owns his or her own business.

·         Is exposed to financial risk by having to bear the cost of making good faulty or substandard work carried out under the contract.

·         Assumes responsibility for investment and management in the enterprise.

·         Has the opportunity to profit from sound management in the scheduling and performance of engagements and tasks.

·         Has control over what is done, how it is done, when and where it is done and whether he or she does it personally.

·         Is free to hire other people, on his or her terms, to do the work which has been agreed to be undertaken.

·         Can provide the same services to more than one person or business at the same time.

·         Provides the materials for the job.

·         Provides equipment and machinery necessary to do the job, other than the small tools of the trade or equipment which in an overall context would not be an indicator of a person in business on their own account.

·         Has a fixed place of business where materials, equipment etc can be stored.

·         Costs and agrees and price for the job.

·         Provides his or her own insurance cover e.g. public liability cover etc.

·         Controls the hours of work in fulfilling the job obligations.

Additional factors to be considered

·         Generally an individual should satisfy the self-employed guidelines above, otherwise he or she will normally be an employee.

·         The fact that an individual has registered for self-assessment or VAT under the principles of self-assessment does not automatically mean that he or she is self-employed.

·         An office holder such as a company director will be taxed under the PAYE system.   However, the terms and conditions may have to be examined by the Scope Section of the Department of Employment Affairs and Social Protection to decide on the appropriate PRSI class.

·         It should be noted that a person who is a self-employed contractor in one job is not necessarily self employed in the next job. It is also possible to be employed and self employed at the same time in different jobs.

·         In the construction sector, for health and safety reasons, all individuals are under the direction of the site foreman/overseer. The self-employed individual controls the method to be employed in carrying out the work.

Having regard to all the factors in this case, there is little to support the proposition that the Complainant was engaged in business on his own account. The evidence suggests that he undertook a continuing arrangement to provide his own skill and labour in the service of the Respondent organisation on a mutually convenient basis as to how and when he would work and that he done so in return for remuneration.

For these reasons I am satisfied that the Complainant was employed by the Respondent under a contract of service.

Complaint under the Unfair Dismissals Acts 1977 to 2017

It was submitted that the Complainant was unfairly dismissed within the meaning of the Unfair Dismissals Acts.

The definition of dismissal in section 1 of the said Act includes the definition for constructive dismissal as follows:

“the termination by the employee of his contract of employment with his employer whether prior notice of the termination was or was not given to the employer, in circumstances in which because of the conduct of the employer the employee was or would have been entitled or it was or would have been reasonable for the employee to terminate the contract of employment without giving prior notice of the termination to the employer”.

It was submitted that the Complainant was constructively dismissed in the circumstances where the conduct of the Respondent was so unreasonable that the Complainant could no longer be expected to put up with it and he was therefore justified in leaving.   The Respondent had required the Complainant to work without payment and then told him to f*** off when he sought to address this matter.

At point 32 of the Complainant’s submission I was asked the following:

“The Adjudication Officer is also asked to examine the conduct of the parties following the incident at the Trade Show. The incident involved the owner / Managing Director of the Respondent Company. There was no internal process or procedure that could be utilised by the Complainant to raise a grievance or otherwise address what had occurred. The Complainant instead “reached out” to the MD to resolve the matter but the only response he received was that he was not an employee. The Complainant therefore took all steps within his power to resolve matters but the Respondent simply refused to engage and made it very clear that his employment had ended by removing his access to the computer systems.”

Complaint under the Terms of Employment (Information) Act 1994

The Complainant was not provided with a contract or any written agreement in relation to his role with the Respondent whether when engaged or at any time thereafter in breach of the said Act.

Complaint under the Minimum Notice Act

The Complainant did not receive any payment in lieu of notice upon the termination of his employment.

Mitigation.

It was established at hearing that the Complainant was unemployed for a period of five weeks before securing employment.

The Complainant is earning less now than what he was earning with the Respondent.

The Complaint claims that he was earning in the region of €79,000 per annum (based on earnings in year 2 of his employment).

CA – 0025022 – 009 – Complaint referred under section 7 of the Terms of Employment (Information) Act, 1994.

The Complainant was not issued with a statement of the particulars of employment in accordance with section 3 of the Act.

The complaint is well founded.

Under section 7(2)(d) of the Act I order the Respondent to pay the Complainant compensation in the sum of 4 weeks pay i.e. €6,089.84.

CA – 0025022 – 010 – Complaint withdrawn.

CA – 0025022 – 011 – Complaint referred under section 8 of the Unfair Dismissals Act, 1977.

I find the complaint to be well founded. The Complainant succeeds in his claim that he was constructively dismissed.

Under section 7 (c) of the Act I order the Respondent to pay the Complainant compensation of €25,000.

CA – 0025022 – 012

The Complaint as presented fails. This is a case of Constructive Dismissal.

CA – 0025022 – 013 – Complaint withdrawn.

CA – 002 – 014 – Complaint withdrawn.

Sums of compensation awarded should be paid within 42 days from the date of this decision.

Employment Status, Constructive Dismissal.