The Legislation

Preliminary Issues under the Act

Before a claim can be taken under the Act a dismissal must have occurred. Section 1 of the Act defines a dismissal in three essential ways:
(a) termination of the employee’s contract by the employer [whether or not prior notice of the termination was given]
(b) termination of the employee’s contract by the employee – whether or not prior notice was given – where in circumstances because of the conduct of the employer, the employee would have been entitled or it would be reasonable for the employee to terminate the contract without giving prior notice
(c) the expiration of the contract of employment for a fixed term without its being renewed under the same contract – or – if a contract for a specified purpose, (where the purpose was of such a kind that the length of the contract was limited but incapable or being precisely ascertained) the cessor of the purpose.

Anyone taking a case under the legislation must be an employee working under a contract of service, rather than an independent contractor working under a contract for services. While the work being provided may be similar or even identical in some cases the legal basis on which it is being done is significantly different. There is no definition of employee under the Act but via the case-law we glean the essential steps in determining if someone is an employee or independent contractor.

The traditional viewpoint was to examine the level of control exercised in relation to the service being provided. However, this test of control has long been done away with and it is now only one factor of many that fall to be considered by the courts in deciding whether or not someone is an employee. The integration test seeks to establish to what extent the individual is integrated into the organisation and the enterprise/economic test seeks to establish the extent to which the individual can be described as a person in business on their own account. It is this last test which is now the more commonly used test, however these cases in practice are quite dependant on the individual facts and sometimes all three tests are combined in determining whether someone is an employee or not.

Case Law
The leading Irish case is still that of the Supreme Court in:
Click link to find out more about the case: Henry Denny & Sons (Ireland) LTD, trading as Kerry Foods v. The Minister for Social Welfare [1998] 1 IR 34

Another key question is whether the worker was in business on his own account or working for another. The courts will consider what sort of obligations are on each side and the parties own description of the relationship – a written contract which describes the worker as an independent contractor will not decide the issue (indeed in many employment disputes there may not be a written contract or the contract may not be signed).

ESB v. Minister for Social Community & Family Affairs [2006] IEHC 59

It will also be considered whether there is exclusive or personal service – whether the worker can delegate their work to someone else. (On this issue see Ready Mixed Concrete Ltd. (South East) v. Minister of Pensions [1968] 2 QB 497, [1968] 1 All ER 433 and Kane v. McCann [1995] ELR 175.)

Looking at the total overall picture rather then applying one single test was again upheld to be the correct approach by the High Court in Minister of Agriculture v. Barry [2009] 1 IR 215. Here the workers were temporary veterinary inspectors for the Minister of Agriculture at the Galtee Meats plant in Co. Cork. The meat plant closed in 2004 and they claimed redundancy payments and payments for minimum notice. When the claim came to be heard before the EAT the Minister for Agriculture argued the inspectors were not employees and therefore were not entitled to the payments under the Acts. The EAT found that they were employees; the Minister then appealed this to the High Court. It was a complex working situation and the High Court found that the EAT were wrong in the test they applied. Here the EAT applied a single composite test for determining if a person is engaged on a contract of service or a contract for services. The Tribunal found that the test “involves looking at the contract as a whole and asking, ‘Is the person in business on his or her own account?’ If the answer is yes, then the contract is one for services. If the answer is no, then the contract is one of service.” This was a somewhat complicated case factually but the essential finding was that it is simply not possible to arrive at the correct result by testing the facts of the case in a rigid formulaic way. This incorrect approach by the EAT was not a correct reading of the Henry Denny case in particular. Henry Denny never set out a single test for determining whether or not a worker was an employee or independent contractor.

Section 2(1) of the Act sets out a long and comprehensive list of who are excluded from its remit, for example members of the Defence forces, Gardai and people employed by a family member are all excluded.

For a fuller picture of who is excluded from the legislation see below:
2.(1) This Act shall not apply in relation to any of the following persons:
(a) an employee (other than a person referred to in section 4 of this Act) who is dismissed, who, at the date of his dismissal, had less than one year’s continuous service with the employer who dismissed him and whose dismissal does not result wholly or mainly from the matters referred to in section 6 (2) (f) of this Act,
(b) an employee who is dismissed and who, on or before the date of his dismissal, had reached the normal retiring age for employees of the same employer in similar employment or who on that date was a person to whom by reason of his age the Redundancy Payments Acts, 1967 to 1973, did not apply,
(c) a person who is employed by his spouse, father, mother, grandfather, grandmother, step-father, step-mother, son, daughter, grandson, granddaughter, step-son, step-daughter, brother, sister, half-brother or half-sister, is a member of his employer’s household and whose place of employment is a private dwelling house or a farm in or on which both the employee and the employer reside,
(d) a person in employment as a member of the Defence Forces, the Judge Advocate-General, the chairman of the Army Pensions Board or the ordinary member thereof who is not an officer of the Medical Corps of the Defence Forces,
(e) a member of the Garda Síochána,
(f) a person (other than a person employed under a contract of employment) who is receiving a training allowance from or undergoing instruction by An Chomhairle Oiliúna or is receiving a training allowance from and undergoing instruction by that body,
(g) a person who is employed by An Chomhairle Oiliúna under a contract of apprenticeship,
(h) a person employed by or under the State other than persons standing designated for the time being under section 17 of the Industrial Relations Act, 1969 ,
(i) officers of a local authority for the purposes of the Local Government Act, 1941

The criteria that applies to all employees is that in order to fall under the Act the employee must at the date of the dismissal have at least fifty-two continuous weeks service with the employer. However this restriction does not apply to employees dismissed because of trade union membership or activity; pregnancy or exercise of their rights under the Maternity Protection Acts 1994-2003; Section 25 of the Adoptive Leave Act 1995; exercise of rights under Section 25(2) (b) of the Parental Leave Act 1998; and exercise of their rights under the Carer’s Leave Act 2001 and the exercise of their rights under the National Minimum Wage Act 2000.

The Unfair Dismissals (Amendment) Act 1993 provided that the dismissal of an employee followed by re-employment by the same employer within 26 weeks will not break the continuity of service requirement if the dismissal was connected with the attempted avoidance of liability under the Act.

The Unfair Dismissals (Amendment) Act 1993 states that for the purpose of unfair dismissals, agency workers are considered to be employees of the hiring employer. Agency workers must still have continuity of service in order to take a claim. The Protection of Employees (Temporary Agency Work) Act 2012 provides that all temporary agency workers must have equal treatment as if they had been directly recruited by the hirer from their first day at work.

Section 2(2) of the Act provides that an employee engaged under a fixed-term or specified purpose contract will not fall under the remit of the Act where the employment ends because the contract expires.

In general, if a contract is for an illegal purpose it is unenforceable. Thus a valid and legal contract must exist before a claim under the Act is to be taken. For example if a contract of employment contains a term in which the way it is to be put into practice will defraud the Revenue then the contract will be illegal and unenforceable. (See In the matter of Red Sail Frozen Foods Ltd (In Receivership) [2007] 2 IR 361)

However this general proposition has come under scrutiny in the last number of years regarding migrant workers. In Hussein v. Labour Court [2012] ILRM 508; [2015] IESC 58 the High Court examined the position of migrant workers and the issue of work permits. The decision of the High Court was ultimately overturned but not on the issue of an illegal contract (in fact the Supreme Court found that this was not the correct issue of law before the court).

Hussein v. Labour Court [2012] ILRM 508; [2015] IESC 58

Ultimately arising out of the findings by the High Court on the enforceability of an illegal contract of employment, various amendments were then made to the Employment Permits Act 2003 by the Employment Permits (Amendment) Act 2014. This Act now provides a defence for a foreign national in certain proceedings under that Act and also provides for civil proceedings to recompense certain foreign nationals for work done or services rendered in certain circumstances.

Under Section 1 of the 1977 Act, a claim for unfair dismissal must be brought within 6 months from the date of the dismissal. The 1993 Amendment Act provided that the time limit could be extended up to another 6 months (for a maximum of 12 months from the date of dismissal) if there were “exceptional circumstances” preventing the lodging of a claim within the first 6 months. The meaning of “exceptional circumstances” has been examined by EAT on numerous occasions; illness and delay by a solicitor can constitute “exceptional circumstances” depending on the facts of the case.

 

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