Complainant

Respondent

Parties

James  Gaule

Waterford Institute of Technology

Representatives

Michael Kinsley B.L. instructed by Bruce St. John Blake & Co. Solicitors

Claire Bruton B.L. instructed by Ronan Daly Jermyn Solicitors

Act

Complaint/Dispute Reference No.

Date of Receipt

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

CA-00038458-001

25/06/2020

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

CA-00038458-005

25/06/2020

The within complaint arises as a result of the insourcing of the maintenance function at Waterford Institute of Technology (W.I.T). The complaint relates to whether the insourcing of the maintenance function was a transfer within the meaning of the Protection of Employees on Transfer of Undertakings) Regulations 2003, the “TUPE” regulations. The complainant asserts that it was a transfer and that the respondent in this complaint, as transferee, breached the regulations in relation to him.

A further related complaint (ADJ-00028907) relates to the complainant’s assertions that he was unfairly dismissed by his previous employer H.A. O’Neill Limited as transferor and that his previous employer also breached the TUPE regulations in relation to him.

The respondent contends that the complainant has not met the burden of proof in establishing that the “TUPE” regulations apply to the insourcing of the maintenance function at W.I.T. Notwithstanding its preliminary point on the burden of proof, the respondent contends that no transfer of undertakings took place.

The respondent stated that the complainant’s role was not encapsulated by the Tender for the maintenance contract in September 2019. The respondent further stated that the role previously undertaken by the complainant was becoming more specialist in nature and required plumbing, gas maintenance and air conditioning work to be carried out. The respondent also outlined that only 20% of the complainant’s role was undertaken by the person directly employed at W.I.T.

The complainant asserts that the insourcing of the maintenance function at W.I.T was a transfer of undertaking within the meaning of the “TUPE” regulations. The complainant’s position is that W.I.T. as transferee did not ensure that his terms and conditions of employment transferred from his previous employer (CA-00038458-001) and that he was unfairly dismissed by W.I.T. by virtue of the transfer (CA-00038458-005). The complainant cited the Labour Court Determination in Department of Social Protection v Dunne [2017] 28 ELR 285 in support of its position that the regulations applied.

The respondent in the within complaint (ADJ-00029002) is W.I.T. The complainant alleges that his employment was the subject of a transfer within the meaning of the 2003 “TUPE” regulations and both H.A. O’Neill as transferor and W.I.T. as transferee breached those regulations in relation to him.

Specifically, the complainant alleges that the respondent, W.I.T. breached the regulations by not ensuring his terms and conditions transferred from the old employer (H A O’Neill Ltd) and that he was dismissed by W.I.T. by virtue of the transfer of undertaking.

For the complainant to succeed, it must first be decided if a transfer within the meaning of the regulations took place in the circumstances of the insourcing of the maintenance functions at W.I.T.

The Applicable Law

Regulation 3 of the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003 (S.I. No. 131 of 2003) provides as follows:

3(1) – These regulations shall apply to any transfer of an undertaking, business or part of an undertaking or from one employer to another employer as a result of a legal transfer (including the forfeiture of a lease) or merger”

In respect of transfers of undertakings, the regulations define transfers as:

“the transfer of an economic entity which retains its identity.”

An economic entity is defined as:

“an organised grouping of resources which has the objective of pursuing an economic activity whether or not that activity is for profit or whether it is central or ancillary to another economic or administrative entity.

The Spijkers Criteria

The 1986 European Court of Justice (ECJ) case Spijkers v Gebroe Benedik Abbatoir CV gave rise to a set of criteria which provide guidance when it comes to deciding whether or not a transfer of undertaking has occurred. The criteria, known as the “Spijkers Criteria” are as follows:

1.       Was the undertaking a stable undertaking, with an ongoing life of its own?

2.       Has the entity retained its identity?

3.       Have some or all of the staff been taken over by the new employer?

4.       Has the customer base transferred?

5.       Are the activities post-transfer similar to those carried out before transfer?

6.       Has there been an interruption of the activity?

7.       Has there been a transfer of assets?

It is clear from the Spijkers’ ruling that the overriding objective is to protect workers in a business which is transferred. Consequently, it is necessary, when deciding whether or not a transfer is taking place, to consider all of the relevant circumstances and factors.

The Suzen case

Another case of relevance in establishing the existence of a transfer within the meanings of the regulations is the case of Ayes Suzen v Zehnacker Gebaudereinigung GmbH Krankenhausservices (1997)] “Suzen”. In this case, the ECJ (now CJEU) held as follows:

“The directive is to be interpreted as meaning that the directive does not apply to a situation in which a person who had entrusted the cleaning of his premises to a first undertaking terminates his contract with the latter and, for the performance of similar work, enters into a new contract with a second undertaking, if there is no concomitant transfer from one undertaking to the other of significant tangible or intangible assets or taking over by the new employer of a major part of the workforce, in terms of their numbers and skills, assigned by his predecessor to the performance of the contract”.

In Labour Court Determination TUD1713, Overpass Limited trading as Ocean Property Management and Susan Clancy, the Labour Court outlines the necessary criteria as follows:

“the type of undertaking or business in question, the transfer or otherwise of tangible assets such as buildings and stocks, the value of intangible assets at the date of transfer, whether the majority of the staff are taken over by the new employer, the transfer or otherwise of the circle of customers and the degree of similarity between activities before and after the transfer, and the duration of any interruption in those activities.”

I further note the EAT decision of Cannon v Noonan Cleaning Company Ltd and CPS Cleaning Services Limited [1998 9 ELR 153] which states as follows:

“The Tribunal must consider all the factors characterising the undertaking in question. The nature of this undertaking is that of cleaning. The equipment used by Noonans was not transferred to the new contractor. The same premises had to be cleaned by both contractors and each were under the control of the Department of Justice. The staff did not transfer when the contract was withdrawn and given to the new contractor. There was no goodwill as such to be transferred. The undertaking could be said to have retained its identity. While there was no apparent transfer of tangible assets however it could be said that there was a transfer of intangible assets, i.e. the likely profit to be made from the contract. This must have existed, otherwise why was there competition for the contract?…Also the possible transfer of the intangible profit margin is not of sufficient significance of itself to be a major factor in the transfer. It follows then that this transfer is not caught by the directive as it does not constitute a transfer of undertaking.

Evidence

The complainant gave evidence under oath at the adjudication hearing. In relation to his duties and the percentages of the tasks that were taken in house at W.I.T. the complainant outlined the specifics of his role at the Institute. The complainant stated that his role was to meet and greet specialist contractors, to check their work, carry out risk assessments as well as work permit issues and to deal with reactive and scheduled maintenance. The complainant stated that he had carried out plumbing installations (Radiators) and although boiler installation was mostly carried out by specialist contractors, he had done this on one occasion. The complainant further outlined that he had maintained air conditioning and air handling units but not in recent years. In relation to gas installations and gas leaks, the complainant confirmed that there had been regulatory changes in these areas, and apart from carrying out a gas leak repair on one occasion he had not carried out work in these areas in recent years due to not being RGII registered. The complainant also outlined his management of the asset register and his recording of maintenance issues that arose on the old system as the new asset register (file maker) was not working at the time.

A member of the Estate management team also gave evidence by affirmation at the adjudication hearing. The witness stated that by virtue of the tender for the maintenance contract in 2016, the complainant was employed on site to carry out reactive and preventative maintenance with specialist maintenance contractors on site as required. The witness confirmed that in 2016, the complainant would have been involved with work involving heating and gas but in more recent years RGII registration was necessary in relation to these areas of work. The witness also stated that the complainant carried out routine maintenance from 2017 onwards in relation to air handling units but air conditioning units were maintained at the time by specialist contractors but now this work is carried out by the new directly employed person. The witness estimated that due to the significant changes in the maintenance role and regulations surrounding same that approximately only 20% of the complainant’s role transferred.

Conclusions

I have considered the submissions and evidence of the parties in relation to the changes to the maintenance function and the insourcing of same at W.I.T.  and have considered whether this amounted to a transfer within the meaning of the regulations.

I am satisfied, on the basis of the definitions within the regulations that the maintenance function provided by H. A. O’Neill Limited was an economic entity which retained its identity when it was insourced at the Institute albeit with significant changes to how the maintenance role was to be carried out. In respect of the “Spijkers” criteria, while some of the criteria is met, I note that there was no transfer of tangible assets such as plant, tools and equipment and the workforce of one did not transfer.

I have also considered the “Suzen” case as well as the relevant case law cited above and conclude that as no tangible or intangible assets transferred, the directive does not apply and the insourcing of the maintenance function at W.I.T. was not a transfer within the meaning of the regulations.

Having considered the submissions of both parties, I am satisfied that the insourcing of the maintenance function in this case was not a transfer within the meaning of the Protection of Employees on Transfer of Undertakings) Regulations 2003 (S.I. No. 131 of 2003). Accordingly, I find that the within complaints CA-00038458-001 and CA-00038458-005 are not well founded.

Transfer of Undertakings

Cases cited by Respondent:

In re: Vantive Holdings [2010] 21.R. 118 at pp, 124-125

Josef Maria Antonium Spijkers v Gebroeders Benedic Abattori CV and Alfred Benedik en Zonen BV [1988] 2 C.M.L.R. 296

Suzen v Zehnacker Gebaudereingigung GmbH Krankenhausservuce [1997] I.R.L.R. 255

Overpass Limited T/A Ocean Property Management V Clancy TUD1713

Rasmussen and Others v Total E&P Norge AS

Keymore Construction Limited v Keogh TUD201

Bligh v Stobart Ireland Driver Services Ltd TU29/2011, TU30/2011, TU 31/20111

Clece SA Valor C-463/09, [2011] I.R.L.R. 251

Cases cited by Complainant:

Department of Social Protection v Dunne [2019] IEHC 634