Complainant

Respondent

Parties

Geraldine  Noonan

Department Of Education

Representatives

Independent Workers' Union

Denis Collins BL instructed by the Chief State Solicitors Office

Act

Complaint/Dispute Reference No.

Date of Receipt

Complaint seeking adjudication by the Workplace Relations Commission under section 7 of the Terms of Employment (Information) Act, 1994

CA-00048307-001

25/01/2022

The Complainant gave her evidence on Oath.

It was the Complainant’s case that she was entitled to a contract of employment.

For the Respondent, Ken Noonan, Assistant Principal, gave evidence on Oath as did Michelle Doran, EO in the Payments Section.

The Respondents denies the existence of any contractual relationship between the parties.

Submissions were exchanged in advance and at my request after the hearing and again following the Supreme Court judgment in The Revenue Commissioners v Karshan (Midlands) Ltd t/a Dominos Pizza [2023] IESC 24.

The Complainant, a home tutor, gave evidence that she was not currently working as a home tutor but presented a payslip from December 2022. She earned €37.65 per hour, working 30 hours per week during the academic year, and commenced working in September 2006.

It was the Complainant’s evidence that the Respondent paid her and that she was limited to working 42 hours a week, with the Respondent setting her hours. She gave evidence of being registered with Shine. The Complainant outlined her teaching qualifications and confirmed her registration with the Teaching Council. In her role, she provides all her own materials, with the Respondent setting her place of work. The Complainant’s annual leave is set by the Respondent, based on the academic calendar, and she is restricted from working on public holidays, Easter, Summer, and Christmas. Paid sick days were not provided to her.

During cross-examination, Mr Collins questioned her about her working hours and asked if they were set at the start of the year. It was the Complainant’s evidence that she can only do a maximum of 42 hours per week, so she is limited to teaching 2-3 children. It was put to her that the Respondent sanctions the number of hours, to which she replied that neither she nor the parent decides on the number of hours. It was put to her that the grant is based on an hourly rate, with the number of hours sanctioned depending on the needs of the child.

The Complainant agreed that it is for the parents to ask her about her qualifications and experience; she was vetted by the Teaching Council, and parents have access to this information. It was further accepted that the parent shares the sanction letter with the tutor, which sets out the hours and conditions of the grant. The Complainant accepted that the grant is sanctioned to the parent, not the tutor. The hours and curriculum are discussed between the parents and the tutor. It was accepted by the Complainant that the Respondent does not attend lessons or give directions on the curriculum.

The Complainant was asked who the parents would go to if they had an issue, to which she replied she was only the tutor. If the child did not utilise their full hours, the Complainant would only get paid for the hours worked. Asked who could terminate the tuition, the Complainant said the parents, and she accepted that the Respondent was not obliged to provide other work.

It was the Complainant’s evidence that while her income was not fixed, she always had two children every year for 18 years. She accepted that if the parent did not sign the claim form, she would not get paid.

Asked about the Respondent setting the place of work, the Complainant replied that the documentation states she must go to the child’s home. She continued that if she provided education outside of the house, the Respondent would not pay her.

Circular 0046/2022 was presented to the Complainant with reference to the Grant Payment Procedures section. It was put to the Complainant that the Respondent is a payroll agent, with deductions being taken at source. It was accepted that expenses, annual leave, and sick leave were not paid.

The Complainant accepted she signed the Declaration of Home Tuition and the conditions attached to every grant.

It was submitted by her representative that the Complainant satisfies all but two criteria for the Revenue Commissioner’s Code of Practice on Determining Employment Status and does not satisfy any of the descriptors of being self-employed in the same Code. It was submitted that the Complainant is not self-employed. The parents engaging the Complainant are not registered as employers. The only other option is that the Respondent is the employer. It was further submitted under the test for mutuality of obligation that while there is no contractual obligation for the Respondent to provide work for the Complainant, there is a moral and practical obligation.

In response to the request for submissions from the Complainant on the Supreme Court decision in The Revenue Commissioners v Karshan (Midlands) Ltd t/a Domino's Pizza [2023] IESC 24, it was submitted that the criterion of a “mutuality of obligation” between an employer and a worker was dismissed as a prerequisite for determining an employment relationship. Consequently, it must be disregarded.

Mr Noonan, Assistant Principal in the Home Tuition Grant Scheme section, gave evidence of the background of the scheme and the criteria for a student to be accepted onto the scheme. Following an application from the parents, hours are assigned to a qualifying student. It was Mr Noonan’s evidence that it is a matter for the parents themselves to take on a tutor. The parents can verify the tutor’s registration via the Teaching Council’s website.

When asked if the Respondent notifies the parent or the tutor, Mr Noonan replied that they notify the parent. Mr Noonan confirmed that the Respondent fixes the hours depending on the age of the child. When asked if there was a relationship between the Respondent and the tutor, he stated that the parent is the applicant and there is no relationship between the tutor and the Respondent.

Mr Noonan stated that both the parent and tutor must sign the claim form; otherwise, there is no payment. There is no payment for the tutor where the child does not take up the hours allocated. It was Mr Noonan’s evidence that it was a temporary scheme intended to mirror school. The parents are advised as to the times they wish to have their child avail of the scheme within a window of hours. In terms of the place of work, the Respondent accepts that the home is not always a suitable location and libraries may be better.

Mr Noonan stated that the grant is given to the parents, and it is up to them to take it up. The Respondent has no contractual obligations to tutors. Mr Noonan was cross-examined and asked who the tutor reports to on a day-to-day basis, to which he replied, the parents. He was asked if the tutor must log their hours and if those hours were sent to the Respondent. He accepted this to be the case. When asked if the parents must register as employers, Mr Noonan replied no, that the Respondent facilitated the parents by making payment to the tutors.

In terms of the temporary nature of the scheme, Mr Noonan said the Respondent would only approve the scheme on a short-term basis and would require it to be renewed. When asked about the children who have engaged with the scheme for numerous years, Mr Noonan replied that the scheme was awarded on an annual basis.

Mr Noonan was asked if the Respondent had a say in the NSSE deduction. He replied only from an accountancy perspective. When asked who sets the curriculum, Mr Noonan’s evidence was that it was the parent and tutor. When asked if the tutors would be allowed to teach Chinese, Mr Noonan said the Respondent does not intervene.

In terms of difficulties faced by parents in finding a tutor, Mr Noonan said the Respondent would point them in the right direction of the SINO or local schools.

Ms Doran gave evidence of her role in approving payments of home tutors on the basis of the claims made. Once the grant is approved, a sanction letter with the terms of the grant is provided to the parents. The sanction letter does state the name of the tutor nominated by the parent. The rate of pay reflects the qualification of the tutor and the age of the child, which is set out in the Circular. The Teaching Council determines the levels of what rates, depending on the qualifications, are paid.

Ms Doran confirmed that the weekly hours of tutors could vary greatly, giving the example of where a child is assigned 20 hours but does not take up the full allocation of hours every week. She said it all depends on the parents. Travel costs and equipment are not covered by the Respondent. There is no sick pay or annual leave payments made nor are any hours which have not been approved paid.

The process was described by Ms Doran as a claim form, signed by both the parents and tutor, is recorded and input into the payroll system for non-teaching staff. That input generates a payment with tax, USC, and PRSI Class S (self-employed) deducted. It was Ms Doran’s evidence that the Revenue system informs the Respondent’s system in real time and is untouched by human hand.

Ms Doran was asked during cross-examination if the parents tried to change the hours to allow the tutor to work longer, she said the Respondent would not pay them. She noted Christmas and Easter were unpaid. She confirmed that the Respondent only pays in respect of hours sanctioned, and it is the Respondent who decides on the hours sanctioned, not the parents.

Asked about the reason the payment system is used, Ms Doran’s evidence was that in 2015 the Revenue requested that deductions be made at source to remove the need for parents to handle payments.

Mr Collins set out the Respondent’s legal position, noting the test of mutuality of obligation, referring to the judgments of Brightwater Selection (Ireland) Ltd v Minister for Social and Family Affairs [2011] IEHC 510, O’Keeffe v Hickey [2008] IESC 72, Minister for Agriculture v Barry [2009] 1 IR 215 (HC), and Castleisland Cattle Breeding Society Ltd v Minister for Social and Family Affairs [2004] 4 IR 158 (SC). It was submitted that there is no mutual obligation between these two parties and therefore the case must fail.

In response to the request for submissions on the Supreme Court decision in The Revenue Commissioners v Karshan (Midlands) Ltd t/a Domino's Pizza [2023] IESC 24, it was submitted that the concept of “mutuality of obligation” is premised on there being a contractual relationship between the parties in the first instance. It is respectfully submitted that the Complainants fail at the first hurdle, as there is no contractual relationship, such as a contract of service or for services, between the Complainants and the Respondent. It was submitted that the Supreme Court in Karshan does not alter the Respondent’s submission that there is no contractual relationship between the Complainants and the Respondent.

In considering the facts of this case and the case law it is first necessary to look at the relevant sections under the Act which this complaint was initiated by the Complainant:-

Section 3 of the Terms of Employment (Information) Act 1994 provides:

3.—(1) An employer shall, not later than one month after the commencement of an employee’s employment with the employer, give or cause to be given to the employee a statement in writing containing the following particulars of the terms of the employee’s employment, that is to say—” with a list of terms which must be included in the contract.

A “contract of employment”, “employee” and “employer” are defined in Section 1 of the Act:-

contract of employment" means—

(a) a contract of service or apprenticeship, or

(b) any other contract whereby —

(i) an individual agrees with another person personally to execute any work or service for that person, or

(ii) an individual agrees with a person carrying on the business of an employment agency within the meaning of the Employment Agency Act 1971 to do or perform personally any work or service for another person (whether or not the other person is a party to the contract),

whether the contract is express or implied and, if express, whether oral or written”

“employee” means a person 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 this Act, a person holding office under, or in the service of, the State (including a member of the Garda Síochána or the Defence Forces) or otherwise as 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 Local Government Act 2001 (as amended by the Local Government Reform Act 2014), a harbour authority, a health board or an education and training board shall be deemed to be an employee employed by the authority or board, as the case may be;

“employer”, in relation to an employee, means 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”

Where there is a dispute between the parties as to whether an employment relationship exists in the first instance, it is necessary to first decide on that issue where such entitlements are contingent on their being employees employed under a contract of service.

The most recent case in this area is the Supreme Court decision in The Revenue Commissioners v Karshan (Midlands) Ltd t/a Domino's Pizza [2023] IESC 24. While this is not an employment law case but one relating to the classification of employees for the purposes of income tax, it is of assistance in determining a worker’s status nonetheless. The Supreme Court addressed the question of whether delivery drivers were employees or self-employed within the meaning of the Tax Consolidation Act 1997 by reference to five questions:-

 “(i) Does the contract involve the exchange of wage or other remuneration for work?

(ii) If so, is the agreement one pursuant to which the worker is agreeing to provide their own services, and not those of a third party, to the employer?

(iii) If so, does the employer exercise sufficient control over the putative employee to render the agreement one that is capable of being an employment agreement?

(iv) If these three requirements are met the decision maker must then determine whether the terms of the contract between employer and worker interpreted in the light of the admissible factual matrix and having regard to the working arrangements between the parties as disclosed by the evidence, are consistent with a contract of employment, or with some other form of contract having regard, in particular, to whether the arrangements point to the putative employee working for themselves or for the putative employer.

(v) Finally, it should be determined whether there is anything in the particular legislative regime under consideration that requires the court to adjust or supplement any of the foregoing.”

Considering the first question does “the contract involve the exchange of a wage or remuneration?” The first part of that question requires a contract and the second part an exchange of a wage or renumeration for work.

The Circular, relied upon by the Respondent and put to the Complainant during cross examination, specifically notes at Section 3 Criteria for the Provision of Grant Aid:-

“Accordingly, it is a condition of the scheme that parents/legal guardians recruit a tutor who is qualified in the sector in which tuition is being provided and is registered with the Teaching Council for the duration of the approved tuition, up to and including issue of final payment.” (emphasis added).

At Section 5 Grant Payment Procedures notes:-

 “Parents/legal guardians engage tutors for the provision of home tuition in a private arrangement. The payments made to tutors on behalf of parents are subject to statutory deductions at source. The Department acts as a payroll agent only on behalf of the parents/legal guardians. This is to facilitate compliance with statutory deduction provisions including taxation and associated provisions” (emphasis added).

This is repeated in Section 1 of the Payment Arrangements for Parents/Legal Guardians/Tutors Booklet. The Application Form states that the applicant is the student’s parent or legal guardian and is submitted by that person with the sanction letter issued to them, if approved. While it is noted that the tutor completes a section with their details and Teaching Council number, ultimately this is an application for a grant by the parent or legal guardian from the Respondent. A condition of the grant award is that a teacher registered with the Teaching Council is recruited by the parent or legal guardian and vetted accordingly. The grant is allocated by hours from the Respondent, with the Teaching Council setting the rates depending on the qualification level of the tutor.

All of this was accepted by the Complainant, with no evidence presented to contradict or dispute this procedure.

The historical reason for a change from the Respondent paying the parent directly to the tutor is a practical one but that did not shift the contractual relationship between the Complainant and Respondent.

Consequently, there is no contractual nexus between the Complainant and the Respondent.

It was very clear that the Complainant is a devoted teacher. Her unwavering vocation to her job and the students she teaches was plausible throughout the hearing.

The evidence presented was clear in this complaint. I find that the Complainant is not an employee, nor is she working under a contract of employment as defined in Section 1 of the 1994 Act. Consequently, I find that the Complainant is not entitled to a contract of employment, and her complaint is not well founded.

I find the complaint is not well founded.

Terms of Employment – employee – employer