Complainant

Respondent

Parties

Ahmed  Tariq

Bidvest Noonan

Representatives

  Ahmed Tariq

Michael McGrath IBEC

Act

Complaint/Dispute Reference No.

Date of Receipt

Complaint seeking adjudication by the Workplace Relations Commission under section 27 of the Organisation of Working Time Act, 1997

CA-00043335-001

30/03/2021

The complaint is concerned with annual leave carried forward by the Complainant from one annual leave year to another and from one employment to another under a transfer of undertakings. The dispute concerns leave carried forward from the annual leave year 2019 into 2020. As can be seen from the Respondent’s case, there is a preliminary point regarding the time limit. The amount of untaken leave in dispute was put at 102 hours by the Complainant in his statement of complaint to the hearing. His gross pay was given as €1,137.41 per fortnight over an average weekly hours of 42 hours per week.

The parties were informed at the hearing that it was held in public and the decision would be published with their names. Given the nature of the case where the case relies in the main on the interpretation of the Organisation of Working Time Act, 1997, there was no objection to proceeding without the administration of an oath.

The Complainant commenced employment with a company MCR as a static security guard on 1st March 2016. On 15th November 2020 the employment relationship with MCR terminated and was transferred to Bidvest Noonan. The Complainant explained that in 2019 he had accrued approximately 300 hours in leave which was carried forward into 2020. The agreed annual leave was January to December each year. The agreement was reached with the supervisor as the Complainant was carrying forward the leave in order to be able to take an extended holiday abroad with his family. It was not possible to take all the leave when intended due to Covid travel restrictions. Prior to the transfer the Complainant had taken 100 hours of annual leave leaving a balance of 204 hours which he claimed as being owed to him. Bidvest Noonan had paid him 92 hours leave and he was seeking the balance of hours which he felt are owed to him which he put at 102. He found himself in the middle of a dispute between MCR as the outgoing employer and Bidvest Noonan where neither would agree that they were liable for the leave which he was seeking. The Complainant had contacted MCR and Bidvest Noonan, but each was blaming the other. Other employees were in the same position. At the hearing he agreed that he had nothing in writing regarding his arrangements with MCR.

This decision is one of facts and the interpretation of the Organisation of Working Time Act. The administration of an oath was not found necessary to allow for a full hearing and the parties did not object to this approach.

Bidvest Noonan raised a preliminary issue regarding time limits for the complaint. The submission on this point was as follows:

“Section 27 of the Organisation of Working Time Act 1997 provides that: (4) A rights commissioner shall not entertain a complaint under this section if it is presented to the commissioner after the expiration of the period of 6 months beginning on the date of the contravention to which the complaint relates.”

An adjudicator can extend the time period by a further 6 months if “reasonable cause” is shown. The submission went on to refer to cases on the interpretation of a reasonable cause - as articulated in Cementation Skanska v Carroll, DWT0338. In this case the complaint was submitted to the WRC on 30/03/2021. The submission referred to Royal Liver Assurance - v - Macken and Others in which it was determined the point at which the initial time limit begins to run. The High Court found that unless the employer had actively sought the employee’s consent to the extension of the leave year as required section (1)(c), time had to run from the expiry of the leave year rather than six months thereafter. It was submitted on behalf of the Respondent that therefore the six-month period in respect of untaken annual leave for the leave year 2019/2020 begins to run on the 31st of March and ends on the 29th of September 2020. The Respondent explained at the hearing that as the leave year ended in the employment was January to December of each year, then the maximum period for the carry forward of the leave was June 2020. Therefore, the initial time limit for a complaint would be the end of December 2020 and the complaint was not submitted until March 2021 and therefore was out of time. The Respondent acknowledged that it was unfortunate that the previous employer MCR did not act in a manner that was fair and pay the Complainant for annual leave that they have received a payment for. However, this does not change the fact that the complaint was out of time and that no reasonable basis exists for extending that time limit beyond the six-month period.

There are some preliminary points to be addressed.

The first is concerned with the meaning of a Transfer of Undertakings (TUPE). Asked at the hearing, Bidvest Noonan, stated that there was a transfer of undertakings from MCR to their Company, and they had applied the provisions of that legislation in terms of the employees on the contract where the Complainant was employed. On this basis, the working understanding of a TUPE applies i.e. that the liabilities of one employer (the transferor) associated with their employees transfer to another employer (the transferee). Therefore, if is established that there was a liability on the part of MCR associated with the annual leave entitlements of Mr Tariq, then that liability transferred with him to Bidvest Noonan.

The second point to be addressed is that of the leave year. Under the Organisation of Working Time Act 1997, the annual leave year for the purposes of the Act is April 1st in any year [Part 1 Preliminary and General refers]. Under the ERO for the Security Industry under which Mr Tariq’s basic terms and conditions of employment are determined, states that annual leave entitlement shall be in accordance with the terms of the Organisation of Working Time Act 1997. From these provisions it follows that this complaint must be assessed under the terms of the Organisation of Working Time Act which does not allow for a different leave year for the consideration of complaints under the Act.

The terms of Section 20(1) require full While the time limit for making a complaint was raised as a preliminary issue by the Respondent, in this case, consideration of that point as a preliminary issue is premature. This is so in this case because the substance of the case presented by the Complainant is that his untaken annual leave carried on with him and that he is owed that leave by someone. In this case he says it is Bidvest Noonan. If it is found that his complaint is well founded in principle, then the question of a time limit may not arise at all.

The applicable part of the EU Directive of 1993 on Working Time law which forms the basis of the national legislation of 1997 is Section 7:

1.      The Member States shall take measures necessary to ensure that every worker is entitled to paid annual leave of at least four weeks in accordance with the conditions for entitlement to, and granting of, such leave laid down by national legislation and/or practice.

2.      The minimum period of paid annual leave may not be replaced by an allowance in lieu, except where the employment relationship.

Section 20 of the Organisation of Working Time Act 1997 ‘Time and pay for annual leave’ gives effect to Section 7 of the Directive and the relevant extract from that Section are as follows:

‘(1) The times at which annual leave is granted to an employee shall be determined by his or her employer having regard to work requirements and subject-

(a)   To the employer taking into to account-

(i)                  The need for the employee to reconcile work and family responsibilities,

(ii)                The opportunities for rest and recreation available to the employee

(b)   To the employer having consulted the employee or the trade union (if any) of which he or she is a member, not later than one month before the day on which the annual leave or, as the case may be, the portion thereof concerned is due to commence, and

(c)    To the leave being granted-

(i)                  Within the leave year to which it relates,

(ii)                With the consent of the employee, within the period of 6 months after the end of that leave year or…. (illness provisions)

         The first point to observe is that the terms of the OWT at Section 20(1) (c) read as having been designed to meet a situation where it is the employer who wishes to have leave rearranged or carried forward into another leave year. The Act does not explicitly provide for situations where it is the employee who does not apply for their annual leave during the leave year-as was the case with Mr Tariq. Implicitly it could be contended that the six-month time limit for taking leave carried forward does not even apply to the employee where that carry forward was not the subject of a request by the employer. Mr Tariq’s evidence was credible where he described holding over leave until 2020 with the agreement of MCR so that he could take extended leave to visit his family. Circumstances changed due to Covid and, while he took some of his carried forward leave, a balance remained which he was carrying on an ongoing basis with MCR. There is no document which shows MCR disputing his claim to be owed leave or insisting that he take that leave and his refusing to do so. This is an important point, i.e. who is responsible for ensuring that leave carried forward is taken, both from a health and safety perspective and as matter of entitlement.

The position adopted by Bidvest seems to place the onus on Mr Tariq to take the accrued leave based on a ‘use it or lose it’ approach. This position was addressed in a case before the CJEU - Sebastian W. Kreuzigar v Land Berlin. There were other aspects of that case which are not relevant to Mr Tariq’s case, but one is very relevant. In that case the worker concerned was seeking payment of an allowance for leave not taken over a two-year period. In their Judgement the CJEU found:

Paragraph 42....The Court has in particular held that Article 7(1)of Directive 2003/88 does not in principle preclude national legislation which lays down conditions for the exercise of the right to paid annual leave expressly conferred by the directive, including even the loss of that right at the end of the leave year or of a carry-over period, provided, however, that the worker who has lost his right to paid annual leave has actually had the opportunity to exercise the right conferred on him by the directive( Shutlzhoff and others,2009). If it is the case that Section 20(1) (c) is the application of Section 7 of the Directive, the paragraph 45 is relevant:

However as is apparent from 42 of the present judgement, it is important to ensure that the application of those provisions of national law cannot lead to the loss of the rights to paid annual leave acquired by the worker even though he has not had the opportunity to exercise those rights.

It could be said that Mr Tariq did not ask to take the full balance of his leave carried over from the previous leave year. This possibility is also addressed by the CJEU in paragraph 47:

As noted by the Advocate General in point 34 of his Opinion, such an automatic loss of entitlement to paid annual leave, which is not subject to prior verification that the worker was in fact given the opportunity to exercise that right, fails to have regard to the limits, recalled in paragraph 42 of the present judgement , which are binding on member states when specifying the conditions for the exercise of that right.

Following on from the above reasoning and decision, allowing that the terms of Section 20 are the national provision for the implementation of Section 7 of the Directive, the six-month time limit which is stipulated at Section 20 (1) (c) (iii) which limits the carry forward period to six months can only apply where the employee is provided with the opportunity to take the leave carried forward. The onus therefore was on MCR to provide Mr Tariq with the opportunity to take the full balance of the leave carried forward and when queried on the matter by Bidvest and Mr Tariq MCR made no claim that such an opportunity was provided.

The full force of the CJEU decision is set out in paragraphs 52 and 53 as follows:

…the employer is in particular required, in view of the mandatory nature of the entitlement to paid annual leave and in order to guarantee the effectiveness of Article 7 of Directive 2003/88 to ensure, specifically and transparently that the worker is actually given the opportunity to take the paid annual  leave to which he is entitled, by encouraging him formally if need be, to do so, while informing him, accurately and in good time so as to ensure that that leave is still capable of procuring for that person concerned the rest and relaxation to which it is supposed to contribute that if he does not take it, it will be lost at the end of the reference period or authorised carry over period, or upon termination of the employment relationship where the termination occurs during such a period.

53 In addition the burden of proof in that respect is on the employer (see Robinson Steele and Others 2006). Should the employer not be able to show that it has showed all due diligence in order to enable the worker actually take the paid annual leave to which he is entitled, it must be held that the loss of the right to such leave, and, in the event of the termination of the employment relationship, the corresponding absence of a payment o an allowance in lieu of annual leave not taken constitutes a failure to have regard, respectively to Article 7 (1) and (2) of the Directive of 2003/88.

The is no evidence that the transferor, MCR encouraged Mr Tariq to take all his untaken leave carried forward into the leave year 2020/21, or that they advised him formally that if not taken by him within a specified period, that it would be lost. Nor is there any evidence of them observing any diligence to ensure that Mr Tariq received his full untaken statutory entitlements to paid annual leave. The terms Section 20(1) on the Act of 1997 providing a fixed period of six months in which leave can be a carried over is limited to those circumstances where Section 7 of the Directive is met and were the actions of the employer are compliant with the required application of the national terms in conformity with the Judgements of the CJEU. A use it or lost it policy is a not a simple matter of time limits. The burden of proof of compliance with the legislation lies with the Employer.

In short-if Mr Tariq had remained in the employment of MCR, he would have retained his entitlement to the leave he had accrued through to the termination of the employment relationship unless the employer were able to show that they had formally and appropriately provided him with the opportunity to take that leave, that he had been advised of the consequences of not doing so and  he had failed to do so.

Reverting to the concept of TUPE-the liability for the annual leave carried forward by agreement with MCR and which they did not ensure was taken before November 2020, passes to Bidvest Noonan under the transfer of undertakings regulations. In line with this decision, the time limit regarding the making of a complaint, relied upon by Bidvest, cannot apply to the facts in this case, whichever leave year is taken as the reference period.

By way of redress as provided for under Section 27, the Respondent is required to restore accrued annual leave of 102 hours to Mr Tariq. The taking of that leave is a matter for the parties to agree if possible, or otherwise to be determined by the Respondent through the application of the principles which underpin this Decision and are set out herein. Given that the problem which became the subject of this complaint is a matter not of the making of Bidvest Noonan (or Mr Tariq) I have decided not to award any additional compensation in addition to the restoration of the accrued hors.

CA-00043335 Organisation of Working Time Act 1997

The complaint brought by Ahmed Tariq regarding untaken annual leave is well founded. Bidvest Noonan are to restore 102 hours annual leave to Mr Tariq’s annual leave account and they are to ensure that any arrangement for taking that leave into the future are to be fully compliant with the Organisation of Working Time Act, and the principles set out by the CJEU as set out in the Decision.

Carry forward of untaken annual leave-OWT-TUPE