Complainant

Respondent

Parties

Beverly  McLoughlin

Evelyn Lambe and Lily Leavy, T/A Hair Flair  

Complainant

Respondent

Representatives

Michelle Bolger ESA Consulting Associates Ltd.

J.J. Fitzgerald & Co

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-00039380-008

26/08/2020

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

CA-00042516-001

26/08/2020

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-00042516-002

26/08/2020

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

CA-00042516-003

26/08/2020

Complaint seeking adjudication by the Workplace Relations Commission under Section 39 of the Redundancy Payments Act, 1967

CA-00042516-004

26/08/2020

Complaint seeking adjudication by the Workplace Relations Commission under Section 39 of the Redundancy Payments Act, 1967

CA-00042516-005

26/08/2020

Complaint seeking adjudication by the Workplace Relations Commission under Section 12 of the Minimum Notice & Terms of Employment Act, 1973

CA-00042516-006

26/08/2020

The complainant has presented seven complaints against the respondent named as Hair Flair on 26 August 2020:

Complaint under Regulation 10 of the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003 (S.I. No. 131 of 2003), Complaint under section 27 of the Organisation of Working Time Act, 1997,

Complaint 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,

Complaint under Section 8 of the Unfair Dismissals Act, 1977,

Two complaints under Section 39 of the Redundancy Payments Act, 1967,

Complaint under Section 12 of the Minimum Notice & Terms of Employment Act, 19

The complainant worked as a hair stylist with the respondent from 2015 until she was dismissed on 19 June 2020.

The complainant worked on average 20.2 hours a week over 3 days. Her basic rate was €10.10 an hour.

The complaint was lodged with the WRC on 26/8/2020.

Written submissions were received by the representatives for the complainant and the respondent.

Subsequent to the hearing, the complainant submitted details of loss incurred which were exchanged with the respondent.

Incorrectly named respondent.

The respondent states that there is no legal entity named Hair Flair. The correct name is Evelyn Lambe and Lily Leavy t/a Hair Flair. The respondent will not consent to the request for a name change. The complainant had legal advice. A trading name is not a legal entity. The CRO should have been searched.

 Mr Mark Scanlon solicitor for the respondent, named in the complaint numbered ADJ-00031899, also objected to the name change. He refers to Auto Direct Ltd v Vasile Mateui DWT1922 where the Labour Court held that the erroneous naming of ‘Auto Depot Tyres Ltd’ on the WRC complaint form to be no more than a technical error and agreed to an amendment to reflect its correct legal title, that of ‘Auto Depot Ltd’.  The respondent states that the error in the instant case is more than a technical error and that I do not have jurisdiction, therefore, to hear the complaint.

Incorrectly named respondent.

Ms Bolger asked that the name be changed to reflect the respondent’s correct legal title. The complainant had asked the respondent to confirm the correct name of the respondent. The respondent failed to provide this confirmation.

 Ms Bolger states that the complainant’s P60, copy of which was submitted, states that Hair Flair is the employer. The salon continued to be called Hair Flair after the respondent had transferred the business to the transferee the complaint against whom is found in ADJ 00031899.

 The complainant engaged with the respondent as Hair Flair.

 Incorrectly named respondent.

 I must decide if I can substitute the actual employer for the entity impleaded in this complaint.

The substitution of the actual employer for the entity impleaded in an originating complaint form has been addressed in a number of authorities. The respondent argues that as the complaint has been brought against an entity that does not exist, the complaint must be dismissed.

McGovern J in the High Court case of County Louth VEC -v- Equality Tribunal [2009] IEHC 370 addressed the question of when proceedings before a statutory Tribunal can be amended. He set out the following principle of law: “If it is permissible in court proceedings to amend pleadings where the justice of the case requires it, then, a fortiori, it should also be permissible to amend a claim as set out in a form such as an originating document before a statutory tribunal, so long as the general nature of the complaint remains the same.”

In the instant complaint the business name was used rather than that of a natural person or legal entity who trades under that business name. Relevant to the complainant’s mistaken use of the respondent’s business name is that the Rules of the Superior Courts allow for proceedings to be initiated against a firm in its business name. Order 14, Rule 11 of RSC, provides as follows: -

 “Any person carrying on business within the jurisdiction in a name or style other than his own name, may be sued in such name or style as if it were a firm name; and, so far as the nature of the case will permit, all rules relating to proceedings against firms shall apply.” 

The Labour Court in Ballarat Clothing Ltd v Aziz, EDA151 agreed to amend the respondent’s title in the light of authorities and adopted the reasoning of Hogan J in O’Higgins v University College Dublin & The Labour Court [2013] IEHC 431 wherein Mr Justice Hogan held

“Even if the wrong party was, in fact, so named, no prejudice whatever was caused by reason of that error (if, indeed, error it be)”….

 In these circumstances, for this Court to hold that the appeal was rendered void by reason of such a technical error would amount to a grossly disproportionate response and deprive the appellant of the substance of her constitutional right of access to the courts.”

The respondent asks me to accept that the incorrect title in the instant case is more than a technical error and the determination of the Labour court in Auto Direct Ltd v Vasile Mateui DWT1922 is of no avail to this complainant in the instant case whose error, the respondent contends, was more than technical. That determination concluded that the erroneous naming of ‘Auto Depot Tyres Ltd’ on the WRC complaint form to be no more than a technical error. But of relevance to the instant complaint are the Court’s conclusions:

“The Court is further fully satisfied that the respondent party that appeared before the Court was the Complainant’s employer. That party was fully aware of the Complainant’s complaints to the WRC. He knew precisely from whom the complaints were and to what the complaints referred. The respondent party has had a full opportunity to be heard and to answer those complaints. The Court is therefore equally satisfied that the employer will suffer no prejudice or injustice by its decision on this preliminary matter…….”

The facts of this case are that

1)the employment contract furnished to the complainant on commencement of her employment was with Hair Flair ‘The Employer’.

2) Likewise, the staff handbook identifies Hair Flair as the employer. The employer Hair Flair appears on the p60.

3) Furthermore, until the Friday before the hearing scheduled for the following Monday the 28 February, the respondents held themselves out as Hair Flair by failing to correct this mistake.

4) The complainant’s representative sought clarification from the respondent on employee matters. Her requests were ignored. No pay slips were submitted indicating the name of the employer.

The named respondent is not a completely different entity in a different location.

I find that the complaint form submitted to the WRC contained the trading name of the company that employed her. I consider this error to be technical in nature. I am satisfied that the actual employer was fully aware at all material times of the instant proceedings.

Considering the facts of this case and taking note of the above decisions, I find that amending the name of the employer does not result in an injustice or prejudice to the proposed respondent.

For the reasons cited above, I agree to amend the name of the respondent to reflect its correct legal title, that of Evelyn Lambe and Lily Leavy, T/A Hair Flair.

 I decide that I do have jurisdiction to hear these complaints.

 CA-00039380-008.  Complaint under Regulation 10 of the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003 (S.I. No. 131 of 2003).

Ms. Bolger stated that despite the respondent’s denials, a transfer occurred within the meaning of Regulation 10 on 22 June 2020, and that the transferee, the respondent in the complaint numbered ADJ 00031899, is liable.

A meeting occurred on 19 June 2020 where the respondent advised the complainant that she intended to transfer the business to Ms. O’Connor. The transferee started organising the complainant on the next day. Clients transferred from the transferor’s business into the transferee’s business. The lease for the property housing the business was signed on the 30 June 2020. There was a transfer of assets. The salon still used the same name, Hair Flair. It was expected that all clients would continue to use the salon. Two staff members transferred. The entire premises continued as it was. Ms Bolger states that the complainant’s contractual rights passed from the respondent transferor to the transferee. By Monday 22 June, the transferee had discretion to decide who could access the premises of Hair Flair and who could access the client list as that data had transferred from the transferor to the transferee.

The respondent failed to provide the complainant with any information concerning the transfer.

Witness 1: the complainant gave evidence under affirmation.

On the 19 June the complainant received a call from the respondent co-owner who asked her to come to a meeting to discuss a return to work and changes therein. Both owners attended the meeting. The respondent co-owner, Ms. EL, told the complainant and colleague X that they would be made redundant and that Ms O’Connor, a fellow employee until then, would be taking over the business.

On Fri 19 June, Ms O Connor telephoned the complainant and apologised for not attending the same meeting. She made a vague reference to the respondent’s suggestion that she should continue with the business on her own, stated that she wanted to think about it and would ring the complainant after the weekend.

The complainant had always had her own set of clients in the salon. They attended when it was convenient for her. It didn’t dawn on the complainant to ask if she would be working with Ms O’Connor. She presumed that she would as they had enjoyed a good working relationship.

The complainant rang the respondent and told her she was worried about the future. The respondent replied that that was a matter between the complainant and Ms O’Connor. She told the respondent co-owner that she wanted to retrieve equipment from the salon. Ms L told her that the locks had been changed. The complainant rang Ms O’Connor who agreed that the complainant should come in the following Monday, 22 June to get the client lists and tools. On the Monday, Ms O’Connor telephoned her and told her that GDPR prevented her from allowing the complainant to access the lists. She did return on 22 June to retrieve her hairdressing equipment. The respondent co-owner, Ms LL told her that her clients were their clients now.

CA-00042516-001. Complaint under section 27 of the Organisation of Working Time Act, 1997.

Breach of sections 19 and 20 of the Act of 1997.

This complaint concerns the failure of the respondent to reckon the complainant’s non -recorded hours for the purposes of annual leave accrual. The shortfall is 10 hours a month and this contravenes section 19 and 20 of the Organisation of working time Act.

Her normal working week amounted to 18 hours spread over Wednesday, Friday and Saturday which was reckoned for annual leave entitlements. The complainant’s representative states handwritten records of the respondent show that she was only paid for her recorded hours.

Direct evidence of complainant.

She worked 10 hours a month extra for 12 months which was not reckoned for leave entitlements The respondent refused to provide details of leave taken.

Breach of section 12 of the Act of 1997

Breaks

Direct evidence of complainant.

Often, the complainant did not receive breaks. Clients were packed into the salon and waiting so it was not possible to take a break. No data was provided to Ms Bolger on the provision of rest breaks.

Cross -examination of complainant.

The complainant denied that she asked the respondent to cap her recorded working hours so as retain DEASP benefits. She stated that she had informed the respondent that she was entitled to work 18.5 hours per week and maintain her benefits. All the wages paid to her were in cash.

Concerning breaks, the complainant denied that she took full breaks and maintained that while she may have been in the kitchen, her breaks were used by her to post material about the salon on social media. In February 2020 the complainant only got breaks inconsistently.

To the point that the complainant did not particularise her complaint, her representative stated that they tried and failed to get details from the respondent.

 CA-00042516-002.Complaint seeking adjudication 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

The complainant withdrew this complaint.

CA-00042516-003 Complaint under Section 8 of the Unfair Dismissals Act, 1977

The complainant was unfairly selected for redundancy.

In the event that the respondent is deemed the employer, the complainant was dismissed in contravention of fair procedures. No notice was provided of her proposed dismissal, no right of representation was offered to her, no criteria for selection as to why she was selected over colleague X were disclosed. The complainant had no opportunity to consider alternatives to redundancy. It was a summary dismissal.

Mitigation

The transferee could have offered the complainant access to their client base so as to mitigate her loss but denied her that access.

The complainant stated that during the lockdown period, she was doing family members’ hair. She made many efforts to get work. She applied to three salons after losing her job in Hair Flair. She was available to work other than for a two-week period in December 2021 when she underwent surgery on her hand.

CA-00042516-004. Complaint under Section 39 of the Redundancy Payments Act, 1967

The respondent while stating that the complainant’s employment was terminated as a result of redundancy failed to pay the complainant redundancy monies in accordance with section 7 of the Act of 1967.The respondent advised the complainant that she had no money to pay her redundancy entitlements in June 2020 but that she would do her best over the coming months to do so.

Complainant’s direct evidence.

On the 18 June the respondent asked the complainant to come to a meeting to discuss a return to work and changes therein. The respondent co-owners attended the meeting. Ms L stated that the complainant and colleague X would be made redundant, and that Ms O’Connor would be taking over the business. There was no consultation merely the delivery of a decision already made.

CA-00042516-005. Complaint under Section 39 of the Redundancy Payments Act, 1967.

The respondent failed to pay the complainant her redundancy monies. The respondent has failed to provide proof of inability to pay. The respondent sent the requisite application form, with three pages missing, and no covering letter to the complainant in September2020. The respondent failed to complete their details on the form and the complainant was unwilling in those circumstances to return an incomplete form.

CA-00042516-006. Complaint under Section 12 of the Minimum Notice & Terms of Employment Act, 19

 The complainant was not provided with paid notice or allowed to work her notice.

 CA-00039380-008.  Complaint under Regulation 10 of the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003 (S.I. No. 131 of 2003) Ca 39380-008.

The respondent denies that a transfer took place within the meaning of the regulations.  The business of the respondent ceased. The complainant was offered redundancy. That being the case, no question of a transfer arises.

The respondent states that it cannot be a transfer as it was not an ‘economic entity’ which is defined in the regulations 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”.

It was not a stable economic entity. The business closed in December 2020.

Without prejudice to the latter position, Regulation 5(2) of the EC Protection of Employees on the Transfer of Undertakings) Regulation 2003 (“Tupe Regulations”) provides that a dismissal for economic, technical or organisational reasons, which entails changes in the workforce , is permitted (“ETO  reasons”) . The respondent submits that should it be determined that a transfer took place, which is contested, ETO reasons should be accepted.

Witness 2: Respondent Co-Owner gave evidence under affirmation.

 The witness confirmed that the salon closed on 14 March 2020, but that at that stage no decision had been taken for the long term. She was devastated at having to close it.

She knew that Ms O’Connor would like to have her own business and that the complainant was not so interested.

She informed the complainant on the 19 June that she was making her redundant. She gave her 2 weeks’ notice of redundancy. The witness and complainant left on good terms.

The complainant was a good staff member.

CA-00042516-001. Complaint under section 27 of the Organisation of Working Time Act, 1997.

Breach of section 19 and 20 of the Act of 1997.

The complainant was paid all her annual leave entitlements. There is no outstanding annual leave due to the complainant. The respondent does not accept that the complainant worked an extra 10 hours a month. The first the respondent heard of this was when it appeared on the WRC complaint form.

Alleged breach of section 12 of the Act of 1997.

The respondent refutes the complainant’s complaint and states that she got breaks in accordance with section 12 of the 1997 Act.  The respondent submits that as the complainant did not particularise her complaint, it should be deemed inadmissible.

Witness 2: Respondent Co-owner gave evidence.

Complaint of breach of section 19 of the Act of 1997.

Non- reckoning of unrecorded hours for purposes of accrual of annual leave.

The complainant wished to limit her weekly hours to 18 to maintain her DEASP benefits. The witness stated that she was wrong to have under recorded the complainant’s hours, but it was done to suit the complainant and at her request. The complainant got a pay slip for 18 hours, but the extra hours were not recorded. She did not think that this was useful to the complainant to record all hours.

Hours in excess of 18 were paid by cash in hand.

Breach of section 12 of the Act of 1997.

Under no circumstances was the complainant not permitted to take breaks. The complainant took 10-minute breaks between 10-11.00.  She never asked staff to log on or off breaks. They were flexible. The complainant and staff took lunch breaks when it was suitable. The complainant took it in the kitchen, sometimes with her daughter. There might be an odd day when she did not get a full hour for her lunch, but it never, ever happened that the complainant received no breaks.

A computer tracking system recorded start and finish times for pay purposes but did not log breaks.

Cross examination of Ms Lambe.

The witness confirmed that all the complainant’s wages were paid in cash.  She accepts that she did not provide salary details, or the number of hours worked to the complainant.

CA-00042516-003 Complaint under Section 8 of the Unfair Dismissals Act, 1977.

The respondent denies that the complainant was unfairly dismissed. There was a genuine redundancy matching the requirements set out in section 7 of the Redundancy Payments Act, 1967. She was given two weeks’ notice of the redundancy on 19 June 2020.

The respondent relies on section 6(4)(c) of the Act of 1977 which provides that redundancy constitutes a defence to a complaint of unfair dismissal. The complainant was offered redundancy and failed to cooperate with the respondent’s efforts to secure her redundancy payments. The respondent sent the requisite application form to the complaint in September 2020 for completion, but she failed to return it.

In the event that the adjudicator finds that she was unfairly dismissed, no award should be made as she presented no evidence of efforts to mitigate her loss.

CA-00042516-004. Complaint under Section 39 of the Redundancy Payments Act, 1967

A genuine redundancy situation arose in June 2020, matching the circumstances set out in section 7(2) of the Act of 1967 as amended, which in turn generates an entitlement to redundancy payments for the complainant. The respondent had ceased to trade.

 The complainant was offered redundancy and refused to cooperate with the process.

Evidence of Witness 2; the Respondent Co-owner.

The witness gave the complainant two weeks’ notice of redundancy on 19 June 2020 and the complainant left on good terms. The witness’s accountant assured the witness that he would attend to the redundancy. The witness posted the redundancy form to the complainant. The complainant did not return the form. The respondent’s accountant followed up. The delay was down to the failure of the complaint to send in the completed application form for redundancy. The accountant telephoned the complainant on a few occasions seeking the completed application form but never received it even up until now.

CA-00042516-005. Complaint under section 39 of the Redundancy payment Act, 1967.

Concerning the non-payment of redundancy monies, the witness stated that the Department of Social Protection paid the redundancy monies to the 2 other staff.

The complainant was a good staff member.

Cross examination of Witness 2.

To the point that the complainant received an incomplete redundancy form, the witness stated that she delegated the entire redundancy piece to her accountant. The only advice which she received on redundancy entitlements was from the accountant.  Contrary to what was stated, she was not in receipt of legal advice. She denied that the failure to action the redundancies until September 2020 was because Ms. O’Connor had taken over the company. She confirmed that Ms. O’Connor received redundancy payments in March 2021.

CA-00042516-006. Complaint under Section 12 of the Minimum Notice & Terms of Employment Act, 19

The complainant was provided with two weeks’ notice

CA-00039380-008.  Complaint under Regulation 10 of the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003 (S.I. No. 131 of 2003).

 The essential question for determination is whether a transfer occurred within the meaning of the Regulations when Ms. Lisa O’Connor, took over the hair salon of Evelyn Lambe and Lily Leavy t/a Hair Flair, such that the complainant was entitled to the protections afforded by the Regulations and had the right to transfer on no less favourable conditions of employment.

Relevant Law

“Regulation 3.         

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

 (2)      Subject to this Regulation, in these Regulations -

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

“Economic entity” means 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”.

Did a transfer occur?

The respondent submits that there has been no transfer of undertaking. The business of Evelyn Lambe and Lily Leavy ceased, and redundancy was offered and paid to two of the three employees. The complainant chose not to cooperate with the redundancy process. The new entity is not an economic entity. It is not a stable entity. It ceased to trade in December 2020.

The respondent also asks me to accept that without prejudice to the foregoing, Regulation 5(2) of the EC (Protection of Employees on Transfer of Undertakings) Regulations 2003 (“TUPE Regulations”) provides that a dismissal for economic, technical or organisational reasons, which entail changes in the workforce, is permitted (“ETO reasons”). Should it be determined that a transfer did occur, ETO reasons should apply in this case.

Legal Authorities.

In examining if a transfer  of an undertaking occurred, and bound by Regulation 3(2), the Labour Court , in Euro Car Parks (Ireland) Limited v Dermot Kelly, TUD1810, had to determine if a transfer of ownership of Euro Car Parks to Oyster Lane Ltd took place such that the complainant , previously employed by Euro Car Parks, would be entitled to transfer from Euro Car Parks (Ireland) Limited into  Oyster Lane Ltd, on no less favourable conditions.

In examining whether the Appellant’s business was a stable economic entity and whether its essential characteristics survived into its next iteration, the Labour Court considered the criteria used by the CJEU in Case 24/85 Spijkers v Gebroeders Benedik Abbatoir CV, to be decisive.

The Court in coming to their decision drew on paragraphs 12, 13 and 15 in Spijkers, which held as follows:

“12 ….it is necessary to consider, in a case such as the present, whether the business was disposed of as a going concern, as would be indicated, inter alia, by the fact that its operation was actually continued or resumed by the new employer, with the same or similar activities.

13 In order to determine whether those conditions are met, it is necessary to consider all the facts characterizing the transaction in question, including the type of undertaking or business, whether or not the business' s tangible assets, such as buildings and movable property, are transferred, the value of its intangible assets at the time of the transfer, whether or not the majority of its employees are taken over by the new employer, whether or not its customers are transferred and the degree of similarity between the activities carried on before and after the transfer and the period, if any, for which those activities were suspended. It should be noted, however, that all those circumstances are merely single factors in the overall assessment which must be made and cannot therefore be considered in isolation.

15 Consequently, in reply to the questions submitted it must be held that article 1(1) of Directive No 77/187 of 14 February 1977 must be interpreted as meaning that the expression ' transfer of an undertaking, business or part of a business to another employer' envisages the case in which the business in question retains its identity. In order to establish whether or not such a transfer has taken place in a case such as that before the national court, it is necessary to consider whether, having regard to all the facts characterizing the transaction, the business was disposed of as a going concern, as would be indicated inter alia by the fact that its operation was actually continued or resumed by the new employer, with the same or similar activities.”

Applying Spijkers to the facts before them, the Labour Court found that:

“The transfer of ownership of the Car Park to Oyster Lane Limited on 14 January 2016 did not alter the identity of the Car Park – the Car Park continued to operate on the same terms as prior to 14 January 2016, which were then formalised on 26 January 2016. The Court of Justice has consistently stated that the decisive criterion for establishing the existence of a transfer within the meaning of the Directive is whether the entity in question retains its identity, as indicated by the fact that its operation is actually continued or resumed.”

The Court found that both operators provide a service (i.e., operating the service of providing carparking facilities to the paying public) utilising that same substantial and fixed essential asset (i.e., the carpark building, ticket payment machines, barriers etc).

The court found that a transfer had occurred.

Applying the criteria enunciated in Spijkers and the conclusions of the Labour Court to the circumstances of the instant case, the following facts stand out:

the hair salon was disposed of as a going concern;

its operation was actually continued or resumed by the new employer, with the same activities;

the premises, salon furniture and equipment transferred,

two of the three employees transferred;

the salon’s clientele transferred;

both the respondent and the person who took over the respondent’s business traded under the same name in the same premises.

The essential characteristics were maintained in that customers availed of a service and expertise on offer to them prior to the transfer.

The respondent offered no evidence that the hair salon was other than stable at the time of the transfer. Covid-19 restrictions were reintroduced at a later period.

Based on the above facts, it would be impossible to avoid the conclusion that the new entity, Lisa O’Connor trading as Hair Flair retained the identity of Evelyn Lambe and Lily Leavy t/a Hair Flair

I find that a transfer of undertakings within the meaning of the Regulations occurred as between Evelyn Lambe and Lily Leavy t/a Hair Flair and Lisa O’Connor T/A Hair Flair.

I must now consider the consequences of this finding

Regulation 8 (6) obliges the transferor and transferee to notify the employees

“not later than 30 days before the transfer and, in any event, in good time before the transfer, of the following:

(a)     the date or proposed date of the transfer;

(b)     the reasons for the transfer;

(c)     the legal implications of the transfer for the employee and a summary of any relevant economic and social implications for that employee;

and

(d)     any measures envisaged in relation to the employees.”

It is accepted that that regulation 8 was not applied. The remedies for this breach are identified in regulation 10.

Liability for a breach of Regulation 8.

The question of upon whom responsibility should rest in the case of an alleged breach of Regulation 8 is dealt with in the Labour Court determination- J Donoghue Beverages Ltd. V Elizabeth Collins, TUD183/2018 which concerned the failure to consult the complainant. The court stated that “Regulation 8 implies a term into the Complainant’s contract of employment that entitles her to a period of information and consultation through her chosen/elected representatives prior to the occurrence of a transfer within the meaning of the Regulations; Regulation 4(1) provides that any remedy for the failure of her employer as transferor to fulfil its obligations under Regulation 8 can only be sought as against the Transferee.” 

On the basis of the evidence, I find that the respondents did not consult the complainant as required by Regulation 8 in relation to the transfer. For the reasons cited above, I do not uphold the complaint against this respondent. Liability rests with the transferee. This is addressed in ADJ 00031899.

The complainant also alleges a breach of Regulation 5 (1). But regulation 5(4) precludes a complainant from obtaining relief under both the Unfair Dismissals Act, 1977 and the Regulations, and the complainant has submitted a complaint of unfair dismissal based on unfair selection for redundancy. This complaint is addressed in CA-00042516-003.

CA-00042516-001. Complaint under section 27 of the Organisation of Working Time Act, 1997.

Alleged breach of section 19and 20 of the Act of 1997.

This complaint concerns the failure of the respondent to reckon the complainant’s non -recorded hours for the purposes of annual leave accrual. The complaint form to the WRC refers to the failure of the respondent to provide the complainant with details of annual leave taken and outstanding.

The complainant was paid leave in respect of her 18 contracted hours a week.

The uncontested evidence was that the complainant was assigned eighteen hours spread over Wednesday, Thursday and Saturday and was, in addition, assigned regular, unrecorded extra hours which she states amounted to ten per month. The complainant’s contract states that her working hours are Tuesday to Saturday and that her hours may vary.  It is accepted that she was paid in cash for these extra ten hours per month and that the respondent did not record these extra hours worked by the complainant.

Given the inability of the respondent to contest the additional ten hours worked by the complainant each per month, owing to the absence of records and the respondent’s own evidence on her reasons for this, the complainant’s statement that she worked on average 10 hours extra  a month cannot be disproven as the respondent, however well-intentioned she may have been in attempting to protect, as she saw it,  the complainant’s entitlements to DEASP benefits is now at a loss because of this consideration.

I decide that the respondent did not reckon these extra 10 hours per month for the purposes of annual leave entitlement.

Relevant law.

In the circumstances of this complaint, Section 19 of the Act of 1997 provides for an entitlement of 8% of the hours he or she works in a leave year (but subject to a maximum of 4 working weeks).

The rate at which the complainant must be paid is set out in section 20(2) of the Act of 1997 as amended, which states

 “2) The pay in respect of an employee's annual leave shall—

(a) be paid to the employee in advance of his or her taking the leave,

(b) be at the normal weekly rate or, as the case may be, at a rate which is proportionate to the normal weekly rate, “

In Section 20(4) the “normal weekly rate” means the

” Normal weekly rate of the employee concerned’s pay determined in accordance with regulations made by the Minister for the purposes of this section”.

S.I No.475/1997 clarifies how the normal weekly rate is decided.

Section 3. (2) states

“(2) If the employee concerned's pay is calculated wholly by reference to a time rate or a fixed rate or salary or any other rate that does not vary in relation to the work done by him or her, the normal weekly rate of his or her pay, for the purposes of the relevant sections, shall be the sum (including any regular bonus or allowance the amount of which does not vary in relation to the work done by the employee but excluding any pay for overtime) that is paid in respect of the normal weekly working hours last worked by the employee before the annual leave (or the portion thereof concerned) commences or, as the case may be, the cesser of employment occurs.”

The complainant’s salary is based on an hourly rate. That being the case, section 3. (2) of S.I No 475/1997 applies.

The complainant’s representative submitted details of the complainant’s income which were exchanged with the respondent and were unchallenged. This evidence identifies the hourly rate as € 15.24 ( €10.10 being the  basic rate and €5.14 the regular rate of  commission)

The respondent co-owner stated in evidence that the practice was that employees who did not take their full annual leave entitlement could carry the leave over until the following year.

The contravention by the respondent of section 23(1)(a) (ii) of the Act of 1997 as amended occurred upon the cessation of employment on 3 July 2020.

The complaint referral form was received by the WRC on 26/8/2020.  Section 23 (1)(b)(ii) of the Act of 1997 as amended applies to the circumstances of this complaint. The statutory leave year runs from 1 April to 31 March of the following leave year.  Therefore, the referable period is the 1 April 2019 to 28 August 2020. But the salon closed on 14 March 2020 due to the government guidelines on Covid-19.

I find the complaint to be well founded.

 I decide that the respondent employer is required to calculate statutory holiday pay based on the normal rate of €10.10 per hour, plus the unrecorded, extra 2.2 hours a week and the commission which works out at €5.14 an hour.

I decide that the respondent is required to comply with the relevant statutory provision set out in section 23(1)(a)(ii) and to pay the complainant the sum of €133 (subject to statutory reductions), in respect of the shortfall of leave which accrued in the statutory leave year 1 April 2019 – 14 March 2020, (The salon closed on this date due to government guidelines).

The complainant did not work in the statutory leave year 1 April 2020-31 March 2021.

I also require the respondent to pay the complainant the sum of €616 which is equal to two weeks wages in compensation for this breach of the Act.

Alleged breach of Section 12 of the Act of 1997.

The issue for determination is whether the complainant received the breaks to which she is entitled under Section 12 of the Act. The complainant alleges that she did not receive such breaks. The respondent states that she received the breaks. 

Relevant Law

Section 12 places a statutory obligation on employers to ensure that an employee is granted breaks as follows:

“(1) An employer shall not require an employee to work for a period of more than 4 hours and 30 minutes without allowing him or her a break of at least 15 minutes.

(2) An employer shall not require an employee to work for a period of more than 6 hours without allowing him or her a break of at least 30 minutes; such a break may include the break referred to in subsection (1).”

The onus is on the respondent to provide such evidence and without this, the respondent is seriously hampered in refuting the assertions of the complainant.

 Evidence of compliance with section 12 of the Act.

To demonstrate that they did get their breaks, Section 25(1) of the Act requires employers to keep records to show compliance with Section 12 as follows:

“An employer shall keep, at the premises or place where his or her employee works or, if the employee works at two or more premises or places, the premises or place from which the activities that the employee is employed to carry on are principally directed or controlled, such records, in such form, if any, as may be prescribed, as will show whether the provisions of this Act and, where applicable, the Activities of Doctors in Training Regulations are being complied with in relation to the employee and those records shall be retained by the employer for at least 3 years from the date of their making.”

It is well settled that appropriate records under Section 25(1) should show the timing and duration of employees’ breaks. 

The respondent does not have a clocking in facility in operation in the salon, nor does the respondent have any documentation to prove that the complainant took her breaks.

In Tribune Printing & Publishing Group v Graphical Print & Media Union (DWT 6/2004) the Labour Court held that an employer had not only an obligation to ensure that their employees received rest breaks but that; "...stating that employees could take rest breaks if they wished and not putting in place proper procedures to ensure that the employee receives those breaks, thus protecting his health and safety, does not discharge that duty".

In the absence of records and given that the onus is on the respondent to demonstrate compliance, I find that the Respondent has failed to discharge the burden of proving compliance with the provision of Sections 12(1) of the Act during the relevant period.

I find this element of the complaint under the Act of 1997 to be well founded.

Cognisable period.

The complaint was lodged on 26 August 2020, so the cognisable period is 27 February 2020 to 26 August 2020. The complaint did not work from 15 March due to the Government mandated closure of businesses, so the period in question during which breaks were denied and, not entirely, was 17 days.

This breach occurred before the transfer took place.

In accordance with section 27 (3) of the Act, I decide that the respondent is to pay the complainant one week’s wages which amounts to €308.

CA-00042516-003 Complaint under Section 8 of the Unfair Dismissals Act, 1977.

This complaint is one of unfair selection for redundancy and an entire absence of fair procedures. The respondent is relying on the defence of redundancy found in section 6(4)(c), of the Act of 1977 as amended.

Relevant law.

Section 6 (3) of the Unfair Dismissals Act 1977 states:

“Without prejudice to the generality of subsection (1) of this section, if an employee was dismissed due to redundancy but the circumstances constituting the redundancy applied equally to one or more other employees in similar employment with the same employer who have not been dismissed, and either—

(a)  the selection of that employee for dismissal resulted wholly or mainly from one or more of the matters specified in subsection (2) of this section or another matter that would not be a ground justifying dismissal, or

 (b) he was selected for dismissal in contravention of a procedure (being a procedure that has been agreed upon by or on behalf of the employer and by the employee or a trade union, or an excepted body under the Trade Union Acts, 1941 and 1971, representing him or 4 has been established by the custom and practice of the employment concerned) relating to redundancy and there were no special reasons justifying a departure from that procedure, then the dismissal shall be deemed, for the purposes of this Act, to be an unfair dismissal.”

The uncontested evidence is that the dismissal on the 19 June 2020 was entirely devoid of natural justice and fair procedures. The complainant was called to a meeting on 19 June 2020 by the respondent co -owners without advance notice of their intention to make her redundant at said meeting. There was no consultation with the claimant prior to making her redundant. She was not given an opportunity to be represented. No opportunity to consider alternatives to dismissal was given to the complainant. The complainant was blindsided by the process. The matter was concluded there and then.

There was no disclosure of the criteria used for selecting the complainant. The selection criteria should apply to all employees working in the same area as the claimant.

A colleague with less service that the complainant transferred into the new entity managed by Ms O’Connor.

The respondent’s own handbook lists a number of criteria that may be used in the selection of staff for redundancy ( “length of service, performance, skills experience, training, future needs of the business and, potentially, attendance”). The section goes on to state that “all things being equal and with no objective criteria to select one employee over another, the employer will resort to “LIFO”.

The handbook guarantees that in the event of redundancy, the respondent will consult with the employee. The respondent ignored the guarantees set out in their own handbook.

I find that the complainant was unfairly selected for redundancy and therefore was unfairly dismissed by this respondent who executed the dismissal contrary to all fair procedures.

Remedy.

The salon ceased trading in December 2020. Compensation is therefore the appropriate remedy.

Mitigation.

I am aware that hair salons were closed from 21 October 2020 until 1 December and again from Christmas 2020 until 10 May 2021.

The complainant maintains that she was hampered in her attempts to mitigate her loss due to the failure of the respondent to provide her with her client lists and details.

She stated that she applied to three salons in the summer of 2020, but the Covid -19 mandated two metre distance rule made it very difficult to get work.  However, the claimant demonstrated little evidence of attempts to secure work when salons reopened. I have factored this into my award.

Considering the period when hair salons were closed and the inability of the complainant to work in December 2021 due to surgery, the complainant’s loss until February 2022 stood at €15,944.

I decide that the respondent is to pay the complainant the sum of €6700 a sum which approximates to five months’ salary and which I believe is just and equitable in all of the circumstances.

CA-00042516-004. Complaint under Section 39 of the Redundancy Payments Act, 1967.

This complaint refers to the failure of the respondent to pay the complainant her redundancy payments and their disregard for their obligation to provide the requisite two weeks ‘notice and consult the complainant in advance of the decision to make her redundant.

Section 7 of the Act of 1967, as amended, provides for a redundancy payment where a redundancy which meets the definition set out in section 7(2) (c) has arisen. This claim for redundancy payment must therefore be based on the premise that a genuine redundancy situation arose in June 2020. But this complaint is also set in the context of a complaint that a Transfer of Undertakings occurred at the same time and in circumstances where the complainant was not transferred. Furthermore, the respondent asked me to accept that ETO reasons apply which is more usually the responsibility of the transferee and for which no case, other than a reference to it, was made out. The respondent justified the redundancy by referring to the uncertain climate brought about by Covid-19. No supporting data was provided. No business case was presented to the complainant by the transferor or the transferee as to why a redundancy was necessary.

In CA-00039380-008, a complaint contained in this decision,I have found that a transfer occurred.

The matter of making awards under the Redundancy Payments Acts 1967- 2016, where that complaint is based on the same set of circumstances grounding a complaint made under the Unfair Dismissals Acts 1977-2015 was addressed in A Van Sales Driver v A Bakery, ADJ -00006787.

The adjudicator noted that

“the EAT in Cusack v Dejay Alarms Ltd (UD1159 /2004 held that compensation may not be awarded twice on the grounds that an employee was dismissed by reason for redundancy and for unfair dismissal. This was also reinforced by Ní Dhomhnaill v Jambo Sana Ltd (UD 1114/2012) which found that dismissal to be unfair such that the employee was awarded loss of earnings for the six months but also the equivalent sum for statutory redundancy. The redundancy sum was awarded as part of the employee’s compensation for unfair dismissal”.

The complaint under the Redundancy Payments Act in Ní Dhomhnaill v Jambo Sana Ltd (UD 1114/2012) was dismissed.

The instant complaint is based on the same set of facts as decided upon in CA-00042516-003 which found that the complainant had been unfairly selected for redundancy and unfairly dismissed.

I do not find this complaint to be well founded.

CA-00042516-005. Complaint seeking adjudication by the Workplace Relations Commission under Section 39 of the Redundancy Payments Act, 1967.

This is a duplicate complaint seeking payment of redundancy monies and stating that no adequate explanation was offered.

This matter has been addressed in CA-00042516-004.

I do not find this complaint to be well founded.

CA-00042516-006.  Complaint under section 12 of the Minimum Notice and Terms of Employment Act, 1973.

It is accepted that the complainant was not paid for the notice period.

Section 4 (1) (b) provides an entitlement to two weeks’ notice for the complainant based on her service which is in excess of two years but less than five.

I find this complaint to be well founded.

I require the respondent to pay the complainant the sum of €616 which represents two weeks’ wages subject to all lawful deductions.

CA-00039380-008.  Complaint under Regulation 10 of the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003 (S.I. No. 131 of 2003) .

I do not find this complaint to be well founded against this respondent.

CA-00042516-001. Complaint under section 27 of the Organisation of Working Time Act, 1997.

I find this complaint to be well founded.

I decided that the respondent is to pay the complaint the sum of €133, subject to all lawful deductions, in respect of this underpayment of holiday pay contrary to sections 19 and 20 of the Act of 1997.

In addition, I require the respondent to pay the complainant the sum of €616 which is equal to two weeks wages in compensation for the breach of sections 19 and 20 the Act of 1997.

 I decide that the respondent is to pay the complaint the sum of €308 in respect of the breaches of section 12 the Act of 1997.

The total awarded under this complaint is €1057.749.

CA-00042516-002.Complaint seeking adjudication 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. 36/201.

This complainant withdrew this complaint.

CA-00042516-003 Complaint under Section 8 of the Unfair Dismissals Act, 1977.

I find this complaint to be well founded.

I require the respondent to pay the complainant the sum of €6700 in compensation for this breach of the Act.

CA-00042516-004. Complaint under Section 39 of the Redundancy Payments Act, 1967.

I do not find this complaint to be well founded.

CA-00042516-005. Complaint under Section 39 of the Redundancy Payments Act, 1967.

I do not find this complaint to be well founded.

CA-00042516-006.  Complaint under section 12 of the Minimum Notice and Terms of Employment Act, 1973

I find this complaint to be well founded. I require the respondent to pay the complainant the sum of €616 subject to all lawful deductions.

TUPE; transferor and  unfair dismissal v  redundancy. calculation of annual leave; breaks.