Complainant

Respondent

Parties

Yugesh Sow Sumroo 

Mulligans of Sandymount Limited

Representatives

Mr Hanan Ur Rahman, Abbot Solicitors

Mr Barry O’Mahony, BL

Act

Complaint 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-00058006-001

01/08/2023

The complainant is a sous chef and he commenced working for the respondent on July 12th 2021.  On May 10th 2023, the respondent wrote to him to inform him that, in accordance with the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003 (“the TUPE Regulations”), his employment would transfer to a new employer, Arundel Bar and Restaurant Limited on June 9th 2023.  At the hearing, the complainant said that he resigned from that company on July 10th 2023.     

In contravention of sections 12 and 15 of the Organisation of Working Time Act 1997, the complainant submits that, when he was employed by the respondent, he did not get breaks and that he worked excessive hours.

On behalf of the respondent, Mr O’Mahony submitted that, in accordance with Regulation 4(1) of the TUPE Regulations, the obligations of the respondent towards the complainant in relation to his employment transferred to his new employer on the date of the transfer:

“The transferor’s rights and obligations arising from a contract of employment existing on the date of a transfer shall, by reason of such transfer, be transferred to the transferee.”

The respondent’s submission was sent to the WRC and to the complainant’s solicitor on the evening before the hearing and Mr Rahman had not had an opportunity to consider the issues raised.  Before proceeding with the hearing, I asked Mr Rahman to make a submission on the issue raised by Mr O’Mahony as a preliminary issue.  I asked the parties to consider the implications for this case of the decision of the Labour Court in J Donoghue Beverages Limited v Charlene Murphy[1].  Mr Rahman sent a supplementary submission to the WRC on June 26th 2024 and Mr O’Mahony responded on July 4th.

Mr Rahman stated that the notice issued to the complainant by the respondent on May 10th 2023 was collected by the complainant on May 12th and, as he received only 28 days’ notice of the transfer, it is therefore not in compliance with Regulation 8, regarding the obligation of an employer to consult with employees 30 days in advance of a transfer.  Mr Rahman argued that, because the notification is not compliant with the Regulations, the respondent cannot benefit from the Regulations.

Mr Rahman referred to a document dated June 9th 2023 with the heading, “Collateral Agreement Re Employees,” which, he submitted, is the basis for the transfer of the business from the respondent, Mulligans of Sandymount, to the transferee, Arundel Bar and Restaurant Limited.  At clause 6.12 of this Agreement, the respondent provided an undertaking to the transferee that there are no disputes, claims or legal proceedings between the respondent and the employees “in respect of whom liability is deemed to pass” to the transferee.

Mr Rahman referred to the reference in this Agreement to an inspection by the WRC on May 2nd 2023, which, he claimed, did not conclude until September 11th, some three months after the transfer.  He argued that this shows that the respondent provided warranties to the transferee which are incorrect, because the respondent was subject to a WRC inspection at the time of the transfer.   

Mr Rahman argued that decision of the Labour Court in J Donoghue Beverages v Charlene Murphy should not apply to the complainant’s case because the circumstances are different and there are questions that can only be answered by the respondent and not the transferee.

Between March and April 2023, the transferee was in contact with the respondent’s employees, informing them of their right to transfer.  The complainant indicated that he was willing to work for the transferee.  On May 10th 2023, the respondent issued the complainant with a “TUPE letter” confirming that his employment would transfer on June 9th 2023. 

Mr O’Mahony submitted that any claim regarding a breach of the Organisation of Working Time Act 1997 can only be submitted against the transferee, Arundel Bar and Restaurant Limited.  Mr O’Mahony said that his position in this regard is supported by the decision of the Labour Court in J Donoghue Beverages v Charlene Murphy.  Ms Murphy complained that, in breach of Regulation 8 of the TUPE Regulations, she wasn’t consulted by J Donoghue Beverages Limited in advance of her transfer to a new employer.  Finding against Ms Murphy, the Court stated as follows:

“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 withing the meaning of the Regulations; Regulation 4(1) provides that any remedy sought for the failure of her employer to fulfil its obligations under Regulation 8 can only be sought as against the Transferee.”

Mr O’Mahony submitted that this case decides exactly the same point being argued by the complainant.

For the avoidance of doubt, there were no proceedings that the respondent was aware of, contemplated or commenced against it at the time of the transfer.  Issues of concern identified by the WRC inspection were addressed to the satisfaction of the WRC.

The Legal Framework

The relevant law is Statutory Instrument 131/2003 – the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003.  This transposes the European Directive 2001/23 “on the approximation of the laws of the member states relating to the safeguarding of employees’ rights in the event of transfers of undertaking or businesses or parts of undertakings or businesses.”  Article 3(1) of the directive provides that,

“The transferor’s rights and obligations arising from a contract of employment or an employment relationship, existing on the date of a transfer, shall, by reason of such transfer, be transferred to the transferee.”

The Directive goes on to provide that member states may create a continuing liability on the transferor, post-transfer; however, this has not been transposed into SI 131/2003.  As a result, the basic principle in Article 3 of the Directive that liability passes from the transferor to the transferee is the applicable law in Ireland.

In the decision of the Court of Justice of the European Union (CJEU) in Berg v Besselsen, the Court referred to the option of member states to enact legislation to include the transferor in ongoing liabilities under a contract of employment; but, where this has not happened, the Court stated:

“It follows that, unless the Member States avail themselves of this possibility, the transferor is released from his obligations as an employer solely by reason of the transfer…”

Liability in this Case

In the case under consideration, there is no dispute that, 30 days before the transfer took place, the transferor engaged in meetings with the transferring employees to notify them of the transfer and to discuss the implications for them arising from the transfer.  The complaint is about breaches of aspects of the Organisation of Working Time Act that allegedly occurred before the complainant transferred to the transferee. 

Having considered the effect of the legislation and the jurisprudence of the CJEU, I find that a complaint against the transferor may not be pursued, because all the liabilities under the complainant’s contract of employment passed to the transferee on the date of the transfer, June 9th 2023.

I have concluded that I have no jurisdiction to adjudicate upon a complaint against the transferor in this case, and I decide therefore that the complaint under the Organisation of Working Time Act 1997 is not well founded.

TUPE, liability of transferor