Complainant

Respondent

Parties

Dylan  McMahon

Elite Level Coaching Ltd.

Act

Complaint/Dispute Reference No.

Date of Receipt

Complaint seeking adjudication by the Workplace Relations Commission under section 6 of the Payment of Wages Act, 1991

CA-00065202-001

05/08/2024

The complainant submits that he did not get paid monies properly payable.

The complainant submits that the respondent failed to pay him monies for the time worked with the respondent.

The complainant gave evidence that he was the respondent’s client initially and was coached by him in physical strength and conditioning and blood analysis and the complainant had a good experience and said the respondent was a good coach.  The respondent had heard that that the complainant was considering leaving his position as an engineer and the respondent offered him a position to work for him as he had too much business and could not keep it all going without additional help.  The role involved on-boarding other clients and taking on additional responsibilities and helping to expand the business.  In April 2024 the complainant was told that the respondent would match the complainant’s salary of €60,000.  Then in May 2024 the complainant was told that he would be paid a salary of €2,500 per month and that the complainant’s salary would thereafter be increased and there would be commission also paid for securing clients.  On 07/06/2024 the complainant received a contract and was shocked that it said that the complainant would be a contractor and that the complainant was expected to set up his own company.  The complainant said he phoned Mr X and said this was not what was agreed and Mr X told him that by doing it this way the complainant could also sign on the dole and also get paid by the respondent.  The complainant signed this agreement but his understanding was that he was an employee but had a negative feeling that the respondent would not pay him. 

It was agreed that the complainant and respondent would share each other’s social media accounts to increase opportunities for revenue for the business.  The work involved cold-calling and the complainant secured 11 engagements of which 5 resulted in a follow up conversation which meant that as a result of the agreement between the complainant and respondent the complainant would be entitled to €2,500 monthly plus €50 for each client who followed up.  The complainant believed that by the respondent’s failure to engage with the complainant as promised and failure to provide client lists that there was not sufficient business and that the respondent was not honest with him.  He said that the respondent promised to pay the complainant on 10/07/2024 but did not and came up many reasons why it did not happen.  To date the complainant has not been paid. 

The complainant said that he was shocked that Mr X suggested that the complainant should sign on for unemployment benefit while also receiving money from the respondent.  He said that interactions with Mr X had previously been very professional but when he became employed he found that Mr X was not professional and that some clients got in touch with the complainant as they were not happy with the way that Mr X was engaging with them.

The complainant provided details of the contract he received which made reference to it being a PAYMENT FOR SERVICES. The Client will pay compensation to The Service Provider for the Services at a rate of €50 euro per appointment booked (where the prospect has shown up for the call) + €2500 euro base salary per month. The compensation shall be payable and due on the 10th of each month

The complainant also highlighted that under Section 7 there is reference that The Service Provider is an independent contractor with respect to The Client and not an employee of The Client but that this was not the complainant’s understanding of the relationship and he would not have left his job for this type of relationship.  The contract references that no benefits, or any employee benefit will be paid and that the complainant had loans that he had to honour and had been trying to get a mortgage and as a result of this he had to sell his car.

In response to the respondent’s email on the morning of the hearing, the complainant said the respondent keeps promising but does not pay the monies that are due

The respondent did not attend the hearing.  On 05/11/2024, the morning of the hearing, at the respondent contacted the WRC and advised that

The complainant submits that the respondent owes him monies for his employment from 10/06/2024 until his employment ended on 12/07/2024.  His evidence was that his monthly pay should have been €2,500 that he worked approximately 5 weeks and he was also owed €250 for commission when he secured 5 clientsThe respondent did not attend and advised by email that €2,500 will be paid by the end of November and I note from the evidence of the complainant that there were previous promises of payment made to the complainant but no payment was made.  I am satisfied that the respondent was on notice of the date and time of the hearing.

In order to determine whether I have jurisdiction to hear this complaint, it is necessary in the first instance to determine the nature of the relationship between the parties and decide whether the complainant was engaged under a “contract of service” or “contract for service”.  I note that the terms of engagement between the parties makes reference to some terms that may suggest an employee relationship and others that may suggest a contractor relationship.  These include in the agreement reference to INDEPENDENT CONTRACTOR 90 DAY AGREEMENT and that Section 4 references salary to be paid of “€2500 euro base salary per month” and Section 7 reference “The Service Provider is an independent contractor with respect to The Client and not an employee of The Client”.

There has been considerable case law developed over the years and it has been accepted in the case of McAuliffe v Minister of Social Welfare [1994] ELR 239 that it is not possible to devise hard and fast rule as to what constitutes a contract of service.  It is necessary to look at the totality, therefore, of the relationship between the parties and consider each case on its own merits and to consider the evidence as presented under a series of tests as set out in varying court cases that have dealt with this issue.  The respondent did not attend and therefore, it is only the complainant’s evidence which is in front of me.

It did not appear from the complainant’s evidence that he could engage another person to carry out the services for which he was engaged to do.  Under the control test outlined in Denny & Sons (Ireland) Ltd. v Minister for Social Welfare [1998] 1 IR 34, at page 50, Keane J. stated:

“It is, accordingly, clear that, while each case must be determined in the light of its particular facts and circumstances, in general a person will be regarded as providing his or her services under a contract of service and not as an independent contractor where he or she is performing those services for another person and not for himself or herself.”

It would appear that that the respondent dictated the terms of engagement and set the daily rate of pay and there is no reference to invoices but the respondent’s agreement does reference salary to be paid.

The Complainant was obliged to engage in a certain manner with clients which was set out by the respondent and it would appear that the Respondent exercised a significant degree of control over work done and the manner by which work was to be done by the Complainant and control of this nature is indicative of the existence of a contract of service.

In Stevenson, Jordan and Harrison Ltd. v McDonald and Evans[1952] 1 TLR 101, Lord Denning, at page 111, stated;

“One feature which seems to run through the instances is that, under a contract of service a man is employed as part of the business, whereas under a contract for services, his work, although done for the business is not integrated into it but is only accessory to it.”

It would appear that from the complainant’s evidence he was integrated into the business for the short length of time he was there by being given access to the respondent’s social media to engage with potential clients.  It would appear that the respondent core business was delivery of fitness coaching to clients and the complainant was taken on board to assist in increasing business revenue and get involved in the coaching as the complainant had knowledge in this area and it was believed the complainant could easily transition into the business.  I note that the complainant advised that it was posted on social media that the complainant was a ‘partner’ of the business but that the complainant submitted that this was done purely for marketing of the business and that all times he was an employee.  I note that the complainant only appeared to have about 3 hours work per day and while it appears questionable as to what level of ‘control’ the complainant was subject to, by the respondent, it would appear that the lack of control was determined by the respondent and his failures to be willing to give the complainant the necessary information for the complainant to do his job.  Taking all the evidence and submissions of the complainant it would appear that overall the complainant was engaged at all material times by the Respondent under a contract of service.

The complainant submitted that he was owed monies with regard to his wages and commission and despite promises the monies have not been paid.  I note that the respondent appears to accept by his email on the morning of the hearing that €2,500 is owed.  I also note that the complainant was employed for over a month and that commission would appear to have been promised. 

Section (6) provides that where—

(a) the total amount of any wages that are paid on any occasion by an employer to an employee is less than the total amount of wages that is properly payable by him to the employee on that occasion (after making any deductions therefrom that fall to be made and are in accordance with this Act), or

(b) none of the wages that are properly payable to an employee by an employer on any occasion (after making any such deductions as aforesaid) are paid to the employee, then, except in so far as the deficiency or non-payment is attributable to an error of computation, the amount of the deficiency or non-payment shall be treated as a deduction made by the employer from the wages of the employee on the occasion.

For there to be a breach of the Act the wages must be properly payable within the cognisable period and the complaints were submitted on 05/08/2024.  In Sullivan v Department of Education PW 2/1997 (reported at [1998] E.L.R. 217) it is set out ,

“if an employee does not receive what is properly payable to him or her from the outset then this can amount to a deduction within the meaning of the 1991 Act”.

The evidence of the complainant is that €2,730 is owed for approximately five weeks worked plus commission of €250 and I find that the complaint is well founded and I direct that the respondent pays the monies properly payable to the complainant during the cognisable period of €2,980 gross.

I find that the complaint is well founded and I direct that the respondent pays the monies properly payable to the complainant during the cognisable period of €2,980 gross.

Payment of wages, commission, contract of service, contract for service.