Complainant

Respondent

Parties

Caroline  Kirwan

Fingal Body Transformation Limited

Representatives

Self-Represented

Mr. Peter Dunlea, Peninsula Business Services (Ireland) Limited

Act

Complaint Reference No.

Date of Receipt

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

CA-00061370-001

02/02/2024

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

CA-00061370-002

02/02/2024

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

CA-00061370-003

02/02/2024

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

CA-00061370-005

02/02/2024

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

CA-00062029-001

06/03/2024

The Complainant commenced her engagement with the Respondent on 9th May 2022. The Complainant submitted that at all relevant times she was engaged as a “manager” with the Respondent organisation. The engagement between the parties was terminated by the Respondent on 15th November 2023.

On 2nd February & 6th March 2024, the Complainant referred the present set of complaints to the Commission. Herein, she alleged that the Respondent had summarily dismissed her in breach of the Unfair Dismissals Acts. She further alleged that the Respondent failed to properly pay her outstanding annual leave on the termination of her employment and failed to provide her with a statement of terms in the course of her employment. In answering this complaint, the Respondent submitted that the Complainant was not, in fact, their employee and that she had been engaged in a self-employment capacity.

A hearing in relation to this matter was convened for, and finalised on, 8th July 2024. This hearing was conducted by way of remote hearing pursuant to the Civil Law and Criminal Law (Miscellaneous Provisions) Act 2020 and SI 359/20206, which designates the WRC as a body empowered to hold remote hearings. No technical issues were experienced during the hearing.

Both parties issued extensive submissions in advance of the hearing. These submissions were expanded upon and contested in the course of the hearing. The Complainant gave evidence in support of her complaints, while two directors of the company gave evidence in defense. While the preliminary issue as to jurisdiction listed above will be determinative of the entire set of complaints, given the nature of the same it will be considered following a summary of the relevant evidence.

In evidence, the Complainant stated that her engagement with the Respondent commenced in July 2019. At this time, the Complainant accepted that she was engaged as a personal trainer with the Respondent. As part of this arrangement, the Complainant provided some administration duties for the Respondent in exchange for access to the gym facilities to facilitate her personal training sessions.

In August 2021, the Complainant was approached by a manager of the Respondent. During this conversation, the Complainant was asked whether she would consider a manager’s position in a recently acquired premises in Drogheda. In evidence, the Complainant stated that she was happy to accept this offer. The Complainant further stated that it was understood that this offer was to be an offer of employment.

In December 2021, the Complainant began working on preparing the new site for opening. In evidence the Complainant stated that this involved interviewing all personnel for positions within the gym, setting up the Respondents administrative functions and physically preparing the space for customers. In February 2022, the Complainant was informed that due to the high costs associated with opening the gym, the Respondent could only afford to pay the Complainant the sum of €1,000 per month. While the Complainant did not feel that this was adequate remuneration for the amount of work she was completing, she accepted same on the understanding that the payment would increase when the new gym became profitable. During the hearing, the Complainant opened various payslips issued by the Respondent. She submitted that these clearly indicate that she is an employee, and that PRSI was paid for her as such.

On assuming these duties as manager of the premises, the Complainant ceased all personal training in an effort to devote all of her time to this new role. Notwithstanding the same, in August 2022, the Complainant asked whether she could set up a coffee shop on the premises of the gym. The Complainant accepted that this was outside of her contract of employment. In this regard, she stated that she worked in the coffee shop whenever she was working for the gym, and that she hired a member of staff for this new venture. As matters transpired, this business was not profitable, and the coffee shop closed a few months after opening.

From February 2022 to November 2023, the Complainant stated that she effectively ran the Respondent’s business. In this regard she stated that she controlled the Respondent’s finances, looked after the buildings and car park and had various HR functions.

On 15th November, the Complainant received a text message from the Respondent requesting that she come in for a meeting. When the Complainant attended that meeting, she was informed that she was “not suitable for the position of manager”. The Complainant asked if she was being dismissed, to which the director of the Respondent stated that she was but that the Respondent was considering a new position for her. The Complainant stated that she already had a job, and did not require a new one to be made for her. The Complainant asked if she could return to the gym to retrieve her belongings, a request that was refused by the Respondent. Thereafter, the Respondent ceased the Complainant’s employment with revenue on 12th December 2023.

By submission, the Complainant stared that she unambiguously an employee of the Respondent. In this respect she stated that she was treated as the same by the Respondent at all times. She stated that her payslip clearly indicates her employment status, as does her integration into the Respondent’s activities. The Complainant stated that she did not receive a contract of employment, she did not received payment in respect of her annual leave on the termination off her employment, and that she was unfairly dismissed.   

By response, the Respondent denied that the Complainant was at any stage their employee.

In this regard, the witness for the Respondent stated that they sought to open a second gym in a new location. At this point, the Complainant was one of many personal trainers that used the Respondent’s premises for the purposes of providing their sessions. In this regard, the Respondent stated that they operated a system whereby they would forego the fees associated with the use of their facilities in circumstances whereby personal trainers would provide certain services, such as receptionist or cleaning duties. As the Complainant had being operating under this system for some time, the Respondent enquired as to whether the Complainant would be interested in continuing this arrangement in the new premises. The Complainant agreed to this proposal and began to provide these services under this arrangement from February 2022. In evidence, the Director of the Respondent stated that they recognised that the Complainant’s duties in setting up a new premises were in excess of those previously provided. In this regard, they arranged to pay the Complainant a “retention fee” of €1,000 per month to cover these additional duties.

Once the Respondent’s premises had been set up, the Complainant discussed setting up an independent business within the Respondent premises. This business, which was completely owned and operated by the Complainant, was entirely independent of the Respondent’s own business, and was the primary focus of the Complainant’s focus at this time. The Respondent accepted that this business closed in June 2023.

Regard the Complainant’s duties, the Respondent submitted that these related to some limited rostering, scheduling and caretaking duties. By the witnesses’ estimation, these duties should have accounted for no more than a few hours per week.

In November 2023, the Respondent was seeking to restructure their operation. In this respect, they approached the Complainant directly and enquired as to whether she would be interested in becoming an employee of the Respondent. In evidence, the Director of the Respondent stated that the Complainant declined this offer and stated that she would prefer to remain as an independent contractor. As the Respondent could no longer facilitate this arrangement, the Complainant ceased providing said services, and the arrangement ended in November 2023.

By submission, the Respondent stated that the Complainant was not their employee at any stage of their engagement, and that she did not have standing to bring the various complaints. In this respect, they submitted that each of the complaints should be dismissed on these grounds and deemed to be not well-founded.

Preliminary Issue

As a preliminary issues as to jurisdiction, the Respondent has submitted that the Complainant was not engaged under a contract of employment and, consequently, that she does not have standing to bring the present set of complaints. By response, the Complainant stated that she was clearly and unambiguously an employee of the Respondent, and that she was treated as such by the Respondent at all times.

In this regard, Section 1 of the Unfair Dismissals Acts defines “employee” as,

“…an individual who has entered into or works under (or, where the employment has ceased, worked under) a contract of employment…”

That Section further defines a “contract of employment” as,

“…a contract of service or of apprenticeship, whether it is express or implied and (if it is express) whether it is oral or in writing…”

In this respect, the other relevant legislative provisions impleaded contain similar wordings in relation to the definition of an employee.

The subject of what constitutes a “contract of employment” for these purposes has been the focus of numerous superior court matters in recent times. Most recently, the Supreme Court issued an authoritative determination in the matter of Revenue Commissioners v. Karshan [2023] IESC 24. Here, following an analysis of the considerable body of law in this particular area, the Supreme Court posed the following five questions that must be examined prior to reaching a determination in this regard:

1.          “Does the contract involve the exchange of wage or other remuneration for work?

2.          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?

3.          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?

4.          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.

5.          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.”

Regarding the factual matrix as presented, it is apparent that questions one and two are unambiguously answered in the affirmative. In addition to the foregoing, it is apparent that question five is not applicable to the present circumstances.  Having regard to the foregoing, the relevant questions to be considered are question three, the matter of control and question four, the application of the relevant evidence.

Regarding the evidence presented by the parties, it is common case that the Complainant provided certain administrative functions for the Respondent. In this regard, the Complainant was responsible for the hiring of staff for the business, for the rostering of said staff, for the upkeep and maintenance of the building itself and for the operation of the car park adjoining the premises. In evidence, the Complainant described herself as the “manager” of the location, and in consideration of the list of duties outlined, it is difficult to disagree with that assessment. While the Respondent has submitted that the Complainant provided these duties in her capacity as an independent contractor, this list of duties demonstrates that the Complainant was fundamentally integrated with the Respondent’s operation and her role was of central importance to their operation. These duties could only have been provided by the Complainant personally and she could not substitute another person to fulfil the same. There is no suggestion that the Complainant could, in any way, profit from the duties she undertook, and no evidence was provided of her providing her own tools for these purposes.

Regarding the control element of the test, the Respondent has submitted that the Complainant was essentially left to her own devices in the manner by which she completed her duties. In this regard, the Director of the Respondent stated that the Complainant had no direct manager on site and that she was broadly free to pick her own hours and complete her own tasks in whatever manner she deemed fit. While it is clearly the case that the Complainant was given a significant degree of latitude in the manner in which she performed her duties, the situation described by the Respondent is entirely consistent with the employment of a site manager within an organisation and does not materially contradict the Complainant’s submission regarding her employment status.

From the evidence of the parties, it is apparent that the Respondent viewed the Complainant, at least somewhat, as being their employee. In this regard, the Complainant was not obliged to issue an invoice for her services, but instead received a monthly wage of €1,000. This wage was confirmed by a payslip, which demonstrated that various employment related contributions were paid on the part of the Complainant. While such a system is not, if itself, determinative of an employment relationship, the payment of a monthly “retention fee”, as described by the Respondent, by way of wages, significantly undermines their claim that the Complainant was an independent contractor.

By submission, the Respondent placed a great deal of reliance on the fact that the Complainant, for a time, operated an independent business from their premises. While it is the case that for approximately three months the Complainant operated a coffee shop from the premises, her evidence was that this was staffed by a separate individual. It is also common case that this endeavour was entirely separate from the Complainant duties with the Respondent.

In consideration of the accumulation of the foregoing points, I find that the Complainant was engaged under a contract of employment with the Respondent.

In such circumstances I assume jurisdiction to hear the substantive complaints as referred.

CA-00061370-001 Complaint under the Unfair Dismissals Acts

Regarding this complaint, the Complainant alleged that she was summarily dismissed during a meeting in November 2023. By response, the Respondent submitted that the Complainant was offered an alternative role within the Respondent organisation. The evidence of their witness was that the Complainant did not accept this role and subsequently terminated her employment.

Having regard to the foregoing, it is apparent that a conflict of evidence arises in respect to the fact of the Complainant’s dismissal and whether the Complainant was dismissed by the Respondent, or terminated her own employment. In the matter of Millett -v- Sherkin [2004] 15 E.L.R. 319, the Labour Court held that,

“A resignation is a unilateral act which, if expressed in unambiguous and unconditional terms, brings a contract of employment to an end. The contract cannot be reconstructed by the subsequent unilateral withdrawal of the resignation.”

In evidence, the Complainant stated that during the meeting in question, the Respondent simply dismissed her without notice or without any apparent cause. In evidence, she stated that the Respondent did offer her alternative role within the organisation. As this appeared to be a demotion in the eyes of the Complainant, she declined the same. It should further be noted that no actual offer was issued in respect to this role at this time. In the alternative, the evidence of the Respondent was that they offered the Complainant a permanent role within the organisation. The Complainant state that she did not want the same, and simply proceeded to terminate her employment.

While the parties are at odds regarding the fact of the dismissal. It is common case that the Respondent invited the Complainant to a meeting to inform her that her role as site manager was to terminate. Both parties accept that the Complainant was to be offered an alternative role, however it is apparent the no actual job offer was issued at this time.

Having regard to the foregoing, it is apparent that the Respondent invited the Complainant to a meeting to inform her that her employment was to be terminated. While both parties agree that an alternative role was discussed during this meeting, it is apparent that the Respondent did not view this role as a continuation of the Complainant’s current employment, but as an entirely new position. In such circumstances I find that the Respondent did, in fact, dismiss the Complainant during this meeting.

The Unfair Dismissals Act provides that in circumstances whereby an employee is dismissed, such dismissal will be presumed to be unfair. Only when the Respondent demonstrates that dismissal arose due to one of the grounds deemed “fair” by the Act, will they discharge this burden. In the present case, there was no attempt by the Respondent to demonstrate compliance with any of these grounds. As a consequence of the foregoing, I find that the dismissal of the Complainant was unfair for the purposes of the Act and her application succeeds.

CA-00061370-002 – Complaint under the Minimum Notice and Terms of Employment Act

In circumstances whereby the Complainant was dismissed without any form of notice, I find that the Respondent is in breach of the impleaded Act and the complaint is well-founded.

CA-00061370-003 – Complaint under the Terms of Employment (Information) Act

In circumstances whereby the Complainant did not receive a statement of terms of employment as required by the Act, I find that the complaint is well-founded.

CA-00061370-005 – Complaint under the Organisation of Working Time Act

Regarding this complaint, the Complainant alleged that she did not receive adequate compensation in respect of outstanding annual leave on the termination of her employment. By correspondence issued following the hearing, the Complainant confirmed that she availed of nine days of annual leave from April 2023.

In the matter of Waterford County Council v O’Donoghue DWT0963, the Labour Court stated that,

“The only leave year which is cognisable for the purpose of determining if an employee received his or her statutory entitlement is that prescribed by the Act itself, that is to say a year starting on 1st April and ending on 31st March the following year. While different arrangements may be put in place for administrative purposes, in determining if a contravention of the Act occurred that Court can only have regard to the leave allocated to an employee in the statutory period.”

Regarding the instant case, the relent leave year commenced on 1St April to and ended with the Complainant’s dismissal on 15th November 2023, a period of approximately seven and a half months. During such a period, the Complainant would have accrued an annual leave entitlement of 12.5 days. In circumstances whereby the Complainant availed of 9 days annual leave during this period, on the termination of her employment she was entitled to a payment to the equivalent value of 3.5 days. In circumstances whereby this payment was not received, I find that the complaint is well-founded, and the Complainant’s application succeeds.

CA-00062029-001 – Complaint under the Terms of Employment (Information) Act

As this complaint is a duplicate of that listed above, I find that the same is not well-founded.

CA-00061370-001 Complaint under the Unfair Dismissals Acts

I find that the Complainant was unfairly dismissed within the definition of the Acts and consequently I find that her application is well-founded.

In relation to redress, Section 7(1) empowers me to order re-instatement, re-engagement or a payment of compensation to be made to a successful Complainant under the Act. Given that neither party wished for the employment relation to recommence, compensation is the most appropriate redress in this circumstance.

In calculating such compensation, regard must be had to the Complainant’s attempts to mitigate her losses following her dismissal. In evidence, the Complainant stated that she encountered some difficulty in securing alternative employment. Notwithstanding the same, it is not at all clear that the Complainant took adequate steps to mitigate her losses. In this regard, no evidence of the Complainant’s attempts to secure alternative work were submitted as part of the proceedings.

Having regard to the foregoing, I award the Complainant the sum of €3,000 in compensation.

CA-00061370-002 – Complaint under the Minimum Notice and Terms of Employment Act

I find that the complaint is well-founded.

I find that the Complainant was not provided with adequate notice of the termination of her employment and, consequently, her complaint is well founded.

In circumstances whereby the Complainant was employed for an excess of thirteen weeks, but fewer than two years, she is entitled to one week of notice, or payment in lieu to the value of €230.77, under the Act

CA-00061370-003 – Complaint under the Terms of Employment (Information) Act

I find that the complaint is well-founded, and consequently the Complainant’s application succeeds.

Section 7 of the Act (as amended) empowers me to award compensation not exceeding four weeks’ remuneration in respect of breach of the Act. Having regard to the totality of the evidence presented, I award the Complainant the sum of €923.08- or four-weeks’ remuneration, in compensation.

CA-00061370-005 – Complaint under the Organisation of Working Time Act

I find that the complaint is well-founded, and consequently the Complainant’s application succeeds.

Regarding redress, I find that the Complainant should receive payment to the value of €161.53 in respect of outstanding annual leave that was not discharged on termination. In addition to the same, I award the Complainant the sum of €300 in compensation for the effects of the breach of the Act.

CA-00062029-001 – Complaint under the Terms of Employment (Information) Act

I find that this complaint is not well-founded.

Karshan, Employment Status, Management, Annual Leave