Complainant

Respondent

Parties

Brian  Pigott

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-00052870-001

19/09/2022

The Complainant gave his evidence on Oath.

It was the Complainant’s case that he 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 he earned €49.50 per hour, working between 35 to 40 hours per week during the academic year, and commenced working in early 2013. In terms of his job as a teacher, the Complainant's evidence indicated that he taught students who either had health difficulties preventing them from attending school or were waiting for a place in a school through the Home Tuition Scheme.

The hours were provided to the students by the Respondent, and the parents contacted the Complainant. He could work a maximum of 42 hours a week and “usually” worked to the curriculum. The parents directed him as to the subjects to teach. The books were supplied to the parents via the Book Rental Scheme, or the parents themselves would supply the books for their child.

The Complainant described the payments as being irregular but supposed to be paid monthly, often delayed due to parents delaying the submission of claim forms. He is taxed at source and gave evidence that he was a PAYE worker for tax purposes. He is not paid sick leave or annual leave and is restricted to working during the academic year.

It was his evidence that the scheme was intended to be temporary for students, but in reality, some students were taught this way for 4-5 years.

During cross-examination by Mr Collins on Circular 046/2022 Home Tuition Grant Scheme 2022/2023, it was agreed that the scheme was intended to be temporary and limited to those with special or medical needs. The Complainant accepted that the parent selects him and that if no parent selects him, there is no work. He also accepted that if a tutor does not want to work with a child, there is no obligation to do so.

When asked if there was an obligation on the Respondent to find work for him, the Complainant replied that he was not aware of the Respondent’s obligations. He did not accept that it was the parents’ obligation to vet him, as that was carried out by the Teaching Council. He explained that he was not aware of how parents determined he was vetted, as many parents could not read or write themselves. The Complainant described frequent scenarios where the parents themselves needed assistance with the application form, indicating the job is not black and white. It was not disputed that the final decision rests with the parent or legal guardian.

The Complainant was asked if the parent could end the relationship at any time, to which he confirmed they could. Appendix 2 in the Application Form, which provides an undertaking to disclose any conviction to the parents of the child and assess suitability from a child protection perspective, was put to the Complainant, to which he replied, “if I have signed it, I accept that”.

When asked about the time and place of the tuition, the Complainant confirmed it was the parent who told him the time, and it was up to him to fit that time into his schedule. Regarding the temporary nature of the scheme, the Complainant acknowledged that while ideally temporary, the reality was often different. He understood his role was to get the child back to school.

In terms of income, the Complainant accepted that travel expenses, sick leave, annual leave, or tuition not pre-approved or not availed of were not covered. He confirmed that both the parent and the tutor sign the form and that while his income does not vary depending on the child, the rate is fixed. The Complainant was assigned Class S PRSI by the Department of Social Protection. When asked if he considered himself self-employed, he replied, “I cannot say but it would appear that way, yes.”

The Complainant gave evidence that he had been on the scheme for 9 years and accepted that before 2015, the payment was made directly to the parents. He noted that this system changed for administrative ease.

Upon inquiry about where the tuition was carried out, the Complainant confirmed it was either in the students' homes or the library. He confirmed he worked through break times by choice and due to time constraints. He described having a strong relationship with social welfare and education offices, and they would approach him with students, indicating high demand for his services.

Regarding the Complainant's interaction with the Respondent, he stated he would contact them as some parents knew little about the system. It was the Complainant’s evidence that he was an employee, as payslips noted him as being an employee, and income tax deductions were made at source. He sought to claim his expenses via a Form 11 self-assessment but was told by Revenue he needed to deregister as a self-assessed individual since he had no income other than PAYE. He confirmed that a SCOPE investigation had not taken place.

The Complainant confirmed he was not required to attend CPD, used his own laptop, and was not provided with any resources from the Respondent. It was the Complainant’s evidence that the Respondent does not question if the parent directs that the hours are less than what is provided for by the scheme.

It was submitted 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 Department of Education. 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 Complainant gave very clear evidence on his engagement with the parents, social welfare, education officers, and, at times, the schools. The only evidence is that there is any interaction with the Respondent around payroll. While I appreciate that he did give evidence that he provided assistance to parents when dealing with the Respondent, this is not on his own behalf.

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

There is no doubt that the Complainant is a diligent and dedicated teacher. His vocation for what must be at times challenging but rewarding work was evident throughout the hearing.

The evidence presented was clear in this complaint. I find that the Complainant is not an employee, nor is he 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 his complaint is not well founded.

I find the complaint is not well founded