CNN191

The Compliance Notice was dated 13^thJuly 2018 and confirmed that an Inspector of the Respondent was of the opinion that the Appellant had contravened the Organisation of Working Time Act, 1997 (the Act of 1997) at Section 21. The order required the Appellant to calculate and pay any unpaid amounts due to two former employees and to submit documentary evidence / proof of compliance.

It is common case that the Appellant did not afford the Public Holiday entitlements required by the Act of 1997 at Section 21 to two named individuals. Those individuals had come to the co-located home and business premises of the Respondent during 2017.

Ground of Appeal.

The Appellant submitted that neither of the two persons identified in the Respondent’s Compliance Notice had been an employee of the Appellant within the meaning of the Act of 1997 at Section 2 and consequently that Section 21 of the Act of 1997 had no application to the Appellant in respect of those persons.

The Respondent submitted that the two persons identified in the Compliance Notice were employees of the Appellant and consequently the Act at Section 21 had application to the Appellant in respect of the employment of the two individuals.

In view of the fact that it is common case that no annual leave entitlements were afforded to the two named individuals the within matter will turn on whether the relationship between the Appellant and the two individuals referred to in the Compliance Notice was that of employer and employee as defined in the Act of 1997.

Summary Position of the Appellant

The Appellant submitted that no employment relationship existed at any material time or ever between the Appellant and the two persons in respect of whom an alleged breach of the Act of 1997 at Section 19(1) is the subject of the Compliance Notice at issue in the within appeal.

The Appellant submitted that the two persons were volunteers who came to work in Ireland from Italy and Spain in order to obtain experience of living abroad and to learn English. The Appellant operated a business from premises which comprised his co-located home and business. The two persons were accommodated in the family home and developed the habit of coming to the business area of the premises in the mornings and engaging with the Appellant and the two staff employed in the business.

The Appellant submitted that his co-located home and business were in a very rural area and the two persons commonly came to the business part of the premises in order to interact with the people who were working there. He submitted that no part of the tasks carried out voluntarily by the two persons when they visited the business had any economic value and such tasks were by way of finding something to occupy them. They were not required to attend the business and neither were they required to carry out any tasks or to ‘help out’ around the house. They were afforded access to the Appellant’s car and they were free to do as they pleased throughout their stay.

The Appellant submitted that his motivation for offering the opportunity to the two persons to come to his home derived from his own experience of similar foreign travel and the fact that he is a qualified English teacher. He submitted that he lived in the rural location with his wife and young child and felt that his family would also benefit from the presence of other people in the family home.

The Appellant submitted sworn statements from both individuals who stated therein that they had never been an employee of the Appellant. The WRC had no statutory capacity to impose an employment contract on parties who neither seek nor want such a contract.

The Appellant submitted that the inspector of the Respondent who had issued the Compliance Notice had never spoken to or otherwise engaged with either person whose alleged employment was the subject of the Compliance Notice at issue in this case.

The Appellant submitted that there were two employees of the business in addition to the Appellant at the material time and the inspector had spoken to neither employee at any time.

Summary testimony on behalf of the Appellant

The Appellant gave evidence as follows:

He had made contact with the two persons through an international website called ‘Workaway’. He lives in the countryside and wanted the benefit of their interaction for his family through their involvement with the day to day life of the family.

He said that no employment relationship existed with either individual and they were free to make use of their time at his co-located home and business in whatever way they chose. Both individuals came to the office part of his premises most days although they were not obliged to do so. The Appellant found tasks for them to do such as scanning and photocopying documents and some research on other countries by way of information gathering. He could not have employed either person because they could not speak English and the capacity to be accurate when using the English language was critical for employees of his business. He said that when they left his home he did not recruit anybody to his business as a replacement.

Under cross examination the appellant said that neither person ever answered a phone in his business.

He said that they did not have English and could not answer a phone in his business. They never filed papers because they could not read English.

He confirmed that whenever they scanned or photocopied documents he asked them to do so. He said that he was trying to find something for them to do when they would come from his home into the office space.

He said that he never designated a time for them to come to the office but that they developed the habit of coming into the office area during the mornings. They could have stayed in bed during the mornings and sometimes did. He said that the two volunteers spent approximately 20 to 25 hours per week between the office part of his premises and his home.

He rejected the proposition that in a mail of 14^thNovember 2017 he agreed that he employed the two persons. He said that his mail on that date was hypothetical.

In response to questioning by the Court the Appellant said that apart from spending time in the office part of his premises the two persons spent time in his co-located home and sometimes minded his child and sometimes ran errands as part of their interaction with his family. He said the inspector never asked him for specific detail as regards what the two persons were doing while in his home and co-located business premises. He estimated that in the mornings they may have spent 65% of their time in the office area and 30% of their time in his home where they minded his child on occasion and 5% of time running occasional errands to the local village shop mainly and using the Appellant’s car.

Summary Position of the Respondent

The Respondent submitted that the two persons referred to in the Compliance Notice worked under a contract of employment with the Appellant and were entitled to the protection of relevant legislation including the Act.

The Respondent set out details of a website called Workaway.info which it submitted was the means of initial contact between the Appellant and the two individuals who were referred to in the compliance notice. An inspector of the Respondent, Ms MD, carried out an inspection of available employment records on 9^thNovember 2017. She advised the Appellant by mail of 14^thNovember that the two individuals were considered to be employees of the Appellant. The Respondent submitted that the two individuals worked between 20 and 25 hours per week in the period from July to December 2017 in the case of one person and from October 2017 to December 2017 in the case of the other. The two carried out marketing and general office duties. The Respondent submitted that the 20 to 25 hours per week involved can be classified as working time and work within the meaning of the Act. The Respondent referred the Court to the definitions of employee and employer set out in the Act of 1997 and asked the Court to consider what it called the common law control test and submitted that the two individuals were subject to control over when, where and how (the means and method) to perform the work.

It was submitted that the two individuals worked at the Appellant’s place of business and that this implies that the Appellant had control. Similarly, the Respondent submitted that the two individuals used the Appellant’s resources and facilities to perform the work they carried out and this tended to show the existence of an employer / employee relationship. The Respondent submitted that the two individuals were an integral part of the Appellant’s business. The Respondent also submitted that persons whose hours of work are set by the employer are usually employees. The Respondent submitted that the nature of the relationship between the Appellant and the two individuals should be objectively evaluated by reference to the realities of the situation and submitted that the acknowledged absence of any written form of contract could not be determinative of the matter. Neither could the fact that the two individuals described themselves as volunteers be considered relevant.

The Respondent asked the Court to imagine two different scenarios which involved hypothetical situations. In addition, the Respondent asked the Court to consider the precarious situation in which so called “volunteers” find themselves in this jurisdiction and the detriment which may be occasioned to them.

Summary testimony on behalf of the Respondent

Ms MD, an inspector of the Respondent, gave evidence on behalf of the Respondent. She said that she conducted an inspection at the offices of the Appellant’s adviser on 9^thNovember 2017. She examined available employment records. Those records did not relate to the two individuals but the Appellant, during that inspection, told her that the two individuals carried out general office and marketing work and that they worked for 20 to 25 hours per week. This description suggested an employee rather than a volunteer role.

She assumed that the two individuals would have to be told by the Appellant as to how to carry out the work and she took that into account in reaching a conclusion that the two individuals were employees of the Appellant. She also took account of the fact that he had said they worked 20 to 25 hours per week although that factor was not determinative. Even if they worked for only five hours per week they could have been employees.

Under cross examination Ms MD confirmed that she had no information in respect of the two individuals other than the words of the Appellant at the inspection meeting on 9^thNovember 2017. She confirmed that she had advised the Appellant by e-mail on 14^thNovember that the two individuals were considered to be employees but that she had no additional information on the 14^thNovember beyond that which had been said by the Appellant on the 9^thNovember. She said that maybe she should have interviewed the two individuals and or the other employees of the Appellant said that sometimes interviews are not helpful. She said that she does not decide such matters on the basis of what is said at interviews. She said that interviews may have helped her but such interviews would not have been determinative of her decision as regards whether the two individuals should be deemed employees. She said that it might have been better if she had spoken with the two individuals and the two other employees of the Appellant.

Such interviews might have been a factor in her decision if they had taken place but they would not have been the main factor.

She confirmed that the only matters considered by her in coming to her conclusion were the two individuals’ involvement in office work. She said that she could not imagine that the two individuals would have attended other than at times set by the Appellant.

She said that she at no time had knowledge of any detail as to what was meant by the Appellant when he said that the two individuals were involved in general office and marketing work.

The Law

The Act of 1997 at Section 2 in relevant part provides as follows:

• 2(1) …

  “contract of employment” means—

  (a) a contract of service or apprenticeship, and

  • (b) any other contract whereby 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),
  whether the contract is express or implied and if express, whether it is oral or in writing;
  • …“ employee” means a person of any age, who has entered into or works under (or, where the employment has ceased, entered into or worked under) a contract of employment and references, in relation to an employer, to an employee shall be construed as references to an employee employed by that employer; and for the purposes of F2 [ this Act and the Activities of Doctors in Training Regulations ], a person holding office under, or in the service of, the State (including a civil servant within the meaning of the Civil Service Regulation Act, 1956) shall be deemed to be an employee employed by the State or Government, as the case may be, and an officer or servant of a local authority for the purposes of the F3 [ Local Government Act 2001 (as amended by the Local Government Reform Act 2014), ]or of a harbour authority, health board or F4 [ a member of staff of an education and training board ] shall be deemed to be an employee employed by the authority, board or committee, as the case may be;

    “ employer” means in relation to an employee, the person with whom the employee has entered into or for whom the employee works under (or, where the employment has ceased, entered into or worked under) a contract of employment, subject to the qualification that the person who under a contract of employment referred to in paragraph (b) of the definition of “ contract of employment” is liable to pay the wages of the individual concerned in respect of the work or service concerned shall be deemed to be the individual’s employer;

The Act of 1997 at Section 21 provides as follows

• 21.(1) Subject to the provisions of this section, an employee shall, in respect of a public holiday, be entitled to whichever one of the following his or her employer determines, namely—

  (a) a paid day off on that day,

  (b) a paid day off within a month of that day,

  (c) an additional day of annual leave,

  (d) an additional day’s pay:

  Provided that if the day on which the public holiday falls is a day on which the employee would, apart from this subsection, be entitled to a paid day off this subsection shall have effect as if paragraph (a) were omitted therefrom.

  (2) An employee may, not later than 21 days before the public holiday concerned, request his or her employer to make, as respects the employee, a determination under subsection (1) in relation to a particular public holiday and notify the employee of that determination at least 14 days before that holiday.

  (3) If an employer fails to comply with a request under subsection (2), he or she shall be deemed to have determined that the entitlement of the employee concerned under subsection (1) shall be to a paid day off on the public holiday concerned or, in a case to which the proviso to subsection (1) applies, to an additional day’s pay.

  (4) Subsection (1) shall not apply, as respects a particular public holiday, to an employee (not being an employee who is a whole-time employee) unless he or she has worked for the employer concerned at least 40 hours during the period of 5 weeks ending on the day before that public holiday.

  (5) Subsection (1) shall not apply, as respects a particular public holiday, to an employee who is, other than on the commencement of this section, absent from work immediately before that public holiday in any of the cases specified in the Third Schedule .

  (6) For the avoidance of doubt, the reference in the proviso to subsection (1) to a day on which the employee is entitled to a paid day off includes a reference to any day on which he or she is not required to work, the pay to which he or she is entitled in respect of a week or other period being regarded, for this purpose, as receivable by him or her in respect of the day or days in that period on which he or she is not required to work as well as the day or days in that period on which he or she is required to work.

• 28. (1) Where an inspector is satisfied that an employer has, in relation to any of his or her employees, contravened a provision to which this section applies, the inspector may serve a notice (in this section referred to as a “compliance notice”) on the employer.

• (a) state the grounds for the inspector’s being satisfied that there has been a contravention referred to in subsection (1),

  (b) for the purpose of ensuring compliance by the employer concerned with any employment enactment, require the employer to do or refrain from doing such act or acts as is or are specified in the notice by such date as is so specified, and

  (c) contain information regarding the bringing of an appeal under subsection (7) against the notice, including the manner in which an appeal shall be brought.

For the Act of 1997 at Section 21 to have effect upon the relationship between the Appellant and the two individuals it is necessary that the Appellant be, within the meaning of the Act, the employer of those two persons and, axiomatically, that they be employees of the Appellant within the meaning of the Act. It follows that the within matter turns on the question of the nature of the relationship between these parties.

The parties to the within appeal have submitted contradictory assertions as regards that relationship and the Court has heard testimony from the Appellant and Respondent in that regard.

Testimony from the Respondent's inspector can be summarised as being to the effect that she formed a conclusion that the Appellant was the employer of the two individuals on the basis of a comment by the Appellant at a meeting on 9^thNovember 2017 when he said that the two carried out administrative and marketing work for the Appellant. The Respondent's inspector also took into account the statement by the Appellant at the same meeting that the two worked for him for approximately 20 to 25 hours per week. In addition, the Respondent's inspector took account of e-mails which she received following her written communication of 14^thNovember 2017 wherein she deemed the two to be employees of the Appellant. The Respondent's inspector, in evidence, confirmed that she had never spoken to either of the two individuals or otherwise communicated with them and she had never issued to either a standard questionnaire.

She said in evidence that perhaps she should have spoken to them and it may have been better if she had. She confirmed in evidence that she had had no knowledge of the detail of the work carried out by either individual prior to her written communication of 14^thNovember 2017. She said that she imagined that the Appellant had control over the working activities of both individuals and could not have imagined it to be any other way.

The Appellant gave evidence as to the relationship between him and the two individuals. He said that he had participated in cultural exchanges himself as a younger person and wanted to do the same for Mr A and Ms B. He said that he lived in a very rural area and felt that such exchanges held benefits for himself and his family as well as for Mr A and Ms B.

The Appellant gave direct evidence that he placed no requirements upon the two individuals as regards the performance of work and placed no requirement upon them to be available to perform work at any set time. He gave evidence that his business and home were co-located and that the two individuals developed the habit of coming to the business part of the premises to interact with himself and the two employees of his business. He stated that he did give them straightforward tasks to perform by way of ‘finding something for them to do’. He gave evidence that the two individuals made no economic contribution to his business and he did not recruit anybody to replace them when they left in December 2017. He gave evidence that the two individuals were free to do as they chose while they resided in his home and had no obligation to perform any work.

The Court notes that the two individuals have supplied sworn statements to the effect that they were not involved in an employment relationship with the Appellant. The Court does not elevate these statements to the status of evidence but they do tend to be probative of the intention of the two individuals at the material time. The intention of the parties however is not the matter which the Court must concern itself. As Carroll J in Re Sunday Tribune Limited [1984] IR 505 held “the Court must look at the realities of the situation in order to determine whether the relationship of employer and employee in fact exists regardless of how the parties describe themselves”

The Appellant and Respondent disagree fundamentally on the realities of the relationship at issue herein. The Court has heard direct evidence from the Appellant wherein it has been asserted that no control was exerted by the Appellant over the individuals and that they were not integrated into his business. He has given evidence that, on most days, they did spend time in the office part of his premises but that any work they carried out was incidental and of no economic value. He has given evidence that no obligation was placed upon either individual to attend at the business at any set time or at all. The Respondent has given evidence that the inspector concerned did not speak or otherwise interact with the two individuals involved or the other employees of the Appellant. She testified that she had no direct knowledge of the working arrangements if any of the two individuals and had no detail of the work they were alleged to be carrying out other than what had been said to her by the Appellant at a meeting during her inspection of 9^thNovember 2017.

The Court has considered the evidence presented by the parties and concludes that the direct evidence of the Appellant must be preferred over what in essence was presumption of the inspector based on a comment of the Appellant. The inspector was unable to proffer any evidence which could contradict the assertions in evidence of the Appellant that the two individuals were not under the control of the Appellant and were not required to carry out any task or work while living in the Appellant’s home which was co-located with his business. That evidence was to the effect that no mutuality of obligation existed between the Appellant and two individuals and the Appellant exerted no control over either individual in terms of the performance of any tasks or work.

Of less significance but nevertheless important was the fact that the inspector was unable to contradict the evidence of the Appellant that the two individuals made no economic contribution to his business.

In all of the circumstances and based on the submissions and evidence, the Court concludes, on the balance of probability, that neither of the two individuals referred to in the Compliance Notice were employees of the Appellant within the meaning of the Act of 1997.

Consequently, the Court finds that the Compliance Notice at issue in the within appeal must be withdrawn.

Determination.

The Court, in accordance with the act at Section 28(10)(b), determines that the Compliance Notice at issue in the within appeal be withdrawn.

The Court so determines.

Signed on behalf of the Labour Court



Kevin Foley
MK______________________
11 March 2019Chairman



NOTE

Enquiries concerning this Determination should be addressed to Mary Kehoe, Court Secretary.