FTD1420

FULL RECOMMENDATION FTC/14/22 DETERMINATION NO. FTD1420 (R-134438-FT-13/GC) INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 15(1), PROTECTION OF EMPLOYEES (FIXED-TERM WORK) ACT, 2003 PARTIES : UNIVERSITY OF LIMERICK (REPRESENTED BY ARTHUR COX SOLICITOR) - AND - DR THOMAS D. ARBUCKLE (REPRESENTED BY UNITE) DIVISION : Chairman: Mr Duffy Employer Member: Ms Doyle Worker Member: Ms Tanham

SUBJECT:
1. Appeal of Rights Commissioner's Decision R-134438-FT-13/GC.


BACKGROUND:

2. The case was referred to the Labour Court in accordance with Section 15(1) of the Protection of Employees (Fixed-Term Work) Act, 2003. A Labour Court hearing took place on 5th November, 2014. The following is the Determination of the Court:



DETERMINATION :

This is an appeal by Dr Tom Arbuckle against the decision of a Rights Commissioner in his claim against the University of Limerick under the Protection of Employees (Fixed-Term Work) Act 2003. There is also a cross-appeal by the University of Limerick against so much of the Rights Commissioner’s decision that found it liable for having penalised Dr Arbuckle contrary to s.13(1) of the Act.

In accordance with the normal practice of the Court the parties are referred to in this Determination as they were at first instance. Hence, Dr Arbuckle is referred to as the Claimant and the University of Limerick is referred to as the Respondent.

Facts

The material factual background to this case is not in dispute and can be summarised as follows:

• The Claimant was employed by the Respondent on a number of fixed-term contracts for the purpose of undertaking research. While there were earlier periods of employment, for present purposes the material period of employment commenced on 3^rd January 2008. On that date the parties entered into a contract of employment for a fixed purpose, namely, to undertake postdoctoral research in the Respondent’s Department of Electrical and Computer Engineering. That contract is referred to herein as the first contract.

  In 2009, while the research to which the first contracted related was still extent, the Respondent obtained funding for another research project from Enterprise Ireland. This project was entitled Evolutionary Algorithms for Solid State Devices. This project is referred to by the Respondent as the “FLASH” Project. In 2010 the Respondent advertised for the position of postdoctoral researcher in the Department of Computer Science and Information Systems for the purpose of writing a code for this project.

  The Claimant came second in the competition for that post. The candidate ranked first declined the post and the Claimant was then appointed to the position. The Complainant then entered into a further fixed purpose contract to conduct research in relation to the FLASH project. That contract commenced on or about 1^st September 2010. It is referred to herein as the second contract.

  The funding for the work associated with the second contract expired in or about August 2012. However the Respondent obtained a no cost extension of the arrangement with Enterprise Ireland and the Claimant’s employment was extended to August 2013, at which time it came to an end. The Respondent now accepts that the circumstances in which the Claimant’s employment terminated constituted a redundancy within the meaning of the Redundancy Payments Acts although he was not paid a redundancy lump sum.

Position of the Parties

The Claimant contends that the conclusion of the second contract for a fixed term contravened s.9(2) of the Act and by operation of s.9(3) of the Act that contract was transmuted to one of indefinite duration by operation of law. The Claimant also contends that the Respondent contravened sections 6, 8 and 13(1) of the Act in relation to him. The Claimant submitted that the carrying out of research is a core function of the Respondent. He contends that the work on which he was employed corresponded to a fixed and permanent need of the Respondent and in these circumstances the use of a fixed term contract was inappropriate.

The Respondent contends that the second contract was entered into in order to meet a purely temporary requirement for the services provided by the Claimant in connection with the FLASH project. It submitted that the conclusion of this contract for a fixed term was justified on objective grounds relating to the nature of the work being performed by the Claimant. The Respondent accepts that undertaking research, per se, is a central and continuing function of a University. However, individual projects are often dependent on external funding and are subject to temporal limitation. It is submitted that the Claimant’s employment was in connection with such a project.

It is the Respondent’s position that complaints in relation to sections 6, 8 and 13(1) were never before the Rights Commissioner or, if they were, they were withdrawn in the course of the first instance hearing.

Complaint in Relation to Section 9 of the Act

Discussion

Both parties presented the Court with comprehensive written submissions on the applicable legal principles and relevant authorities.

The law applicable in a case such as this is now well settled and can be briefly stated.

Section 9(2) of the Act is relevant for present purposes. It provides: -

• (2) Subject to subsection (4), where after the passing of this Act a fixed-term employee is employed by his or her employer or associated employer on two or more continuous fixed-term contracts and the date of the first such contract is subsequent to the date on which this Act is passed, the aggregate duration of such contracts shall not exceed four years.

Section 9(3) provides: -

• (3) Where any term of a fixed term contract purports to contravene subsection (1) or (2) that term shall have no effect and the contract concerned shall be deemed to be a contract of indefinite duration.

Section 9(4) provides that subs. (1), (2) and (3) of s.9 are not applicable to the renewal of a fixed-term contract where there are objective grounds justifying such a renewal.

Section 7 (1) of the Act deals with what constitutes objective grounds for this purpose and provides:

• “(1) A ground shall not be regarded as an objective ground for the purposes of any provision of this Part unless it is based on considerations other than the status of the employee concerned as a fixed-term employee and the less favourable treatment which it involves for that employee (which treatment may include the renewal of a fixed-term employee's contract for a further fixed term) is for the purpose of achieving a legitimate objective of the employer and such treatment is appropriate and necessary for that purpose.

The practical application of these principles have been considered in a line of earlier decisions of this Court, the High Court and the Court of Justice of the European Union.

The second contract is of central relevance in the instant case. While the Claimant had earlier periods of fixed term employment his continuous period of fixed term employment for present purposes commenced on or about 3^rd January 2008. The second contract commenced on or about 1^st September 2010. There was no break in service between the first and the second contracts. The second contract was not limited by time but was for a specific purpose, namely the conduct of research associated with the FLASH project. Accordingly it was a fixed term contract as that term is defined by the Act. That project in fact extended over a period of three years. The Court is satisfied that the Respondent knew, or ought to have known, at the commencement of this contract that it would extend over that period. Consequently, the second contract purported to extend the aggregate duration of the Claimant’s fixed term employment beyond the four years ordinarily permissible by s.9(2) of the Act. The net question that arises in these circumstances is whether the conclusion of the second contract for a fixed term was saved by s.9(4) of the Act as being justified on objective grounds.

It is well settled that the objective grounds relied upon as justification for the extension of a period of fixed term employment beyond four years must be present and operating on the mind of the employer at the commencement of the contract having that effect. That was made clear by the High Court in Russell v Mount Temple Comprehensive School [2009] IEHC 533 (see also the Determination of this Court in St Catherine’s College for Home Economics v Maloney [2009] 20 E.L.R. 143).

The grounds relied upon must also relate to the nature of the work for which the impugned contract was concluded or to the circumstances in which the work is to be performed. In case C-212/04 Adeneler and Ors. V Ellinikos Organismos Galaktos IRLR 716 the CJEU pointed out as follows: -

• “[T]he concept of 'objective reasons', within the meaning of clause 5(1)(a) of the Framework Agreement, must be understood as referring to precise and concrete circumstances characterising a given activity, which are therefore capable in that particular context of justifying the use of successive fixed-term employment contracts.

  Those circumstances may result, in particular, from the specific nature of the tasks for the performance of which such contracts have been concluded and from the inherent characteristics of those tasks or, as the case may be, from pursuit of a legitimate social-policy objective of a Member State.”

In Determination FTD1412, Dr Mary Benson and National University of Ireland Maynooth this Court considered if uncertainty of funding for a post could, in and of itself, constitute objective justification within the meaning of the Act. The Court observed: -

• The source from which funding is derived for a post does not, in and of itself, relate to the specific nature of the post or to the inherent characteristics of the tasks to be performed. Consequently it cannot constitute objective reasons justifying the use of a fixed term contract as that concept was explained in Adeneler. Moreover, if uncertainty of funding were to be accepted as an objective ground justifying the use of fixed term contract it could apply to almost any post. That is particularly so in organisations, such as the Respondent, which are dependent on the allocation of funding from public sources and in respect of which there can be no certainty from one year to the next.

It is well settled by the authorities that the fixed and permanent needs of an employer should normally be fulfilled by the use of permanent employment relationships (see Cases C-378/07 to C-380/07 Kiriaki Angelidaki and Others v Organismos Nomarkhiaki Aftodiikisi Rethimnis and Dimos Geropotamou [2009] ECR 1-3071). But it is also clear from the jurisprudence that the circumstances under which work that corresponds to an employer’s fixed and permanent needs is to be performed can provide objective justification for the use of fixed terms contracts. There is no closed category of circumstances in which that can arise. It may be that an employee is employed for a fixed term to perform work which corresponds to the fixed and permanent needs of the employer but they do so in order to provide cover for another employee who is temporally absent. It could also arise in circumstances where a regular workforce has to be augmented so as to meet some temporary requirement of the business. In that regard, while the Framework Agreement on Fixed Term Work annexed to Directive 99/70/EC (upon which the Act is based) recognises that while employment contracts of indefinite duration are to be regarded as the general form of employment relationships, fixed-term employment contracts are a feature of employment in certain sectors, occupations and activities which can suit both employers and workers (see recitals 6and 8 in the preamble to the Framework Agreement). In applying that provision the Court will normally look to see if the temporal nature of the post in issue is clearly discernible at the time the impugned contract is concluded.

Application to the Instant Case

It is acknowledged that the conduct of research forms part of the fixed and permanent needs of a University. But that is not to say that the use of a fixed term contract can never be justified for the purpose of undertaking a particular project or piece of research. As in all cases, it depends on the nature of the particular work in issue and the factual circumstances in which that work is to be performed. In the instant case the second contract was concluded for the purpose of writing a code and related work on a specific project for which particular skills and knowledge that the Claimant possessed were required. That in essence is the object pursued by Respondent in employing the Claimant.

The Claimant correctly pointed out that the reason for concluding the second contract for a fixed term rather than for an indefinite duration was not set out with any level of clarity or particularity in the contract itself. The relevant provision of that contract merely recited the nature of the work to be performed and that it was subject to the continued availability of funding. It is, however, clear from the contract itself and from the circumstances surrounding its conclusion that the Claimant was recruited specifically to work on the FLASH project

It is not disputed that on completion of the FLASH project the Respondent had no continuing requirement for the type of work in which the Claimant had been employed in connection with the project. The Court is satisfied that this was anticipated by the Respondent at the time that the second contract was concluded and that this was the principal reason for limiting the Claimant’s tenure in employment to the duration of the task for which he was employed. That, in the Court’s view, corresponded to a legitimate objective of the Respondent.

However the Court must go on to consider if the means chosen to achieve the objective were proportionate and appropriate. In considering that point the Court has taken into consideration the decision of the High Court in An Post v Monaghan & ors [2013] IEHC 404. Here. Hedigan J held that a Court should ask itself if the impugned measure (in this case employing the Claimant for a fixed-term) was the minimum unfavourable treatment necessary to enable the employer to obtain its objective. The Court is satisfied that when the second contract was concluded the Respondent knew with virtual certainty that its requirement for the work to which that contract related would not endure beyond the completion of the FLASH project and that the Claimant would then become redundant. That is in fact what occurred. In that factual situation the Court accepts that the conclusion of a fixed term contract for the work in question was both proportionate and appropriate and was the minimum unfavourable treatment necessary so as to obtain the Respondent’s objective.

In these circumstances the Court has concluded that the Respondent did not contravene s.9(2) of the Act in relation to the Claimant.

Complaints relating to Sections 6, 8 and 13(1) of the Act

It is by no means clear that these complaints were properly before the Rights Commissioner. They were not raised in the originating form by which these proceedings were initiated. It seems that they were raised verbally at the hearing before the Rights Commissioner but it is also accepted that in the course of the hearing the then representative of the Claimant informed the Rights Commissioner that they were not being pursued. In these circumstances the Court is satisfied that in so far as these complaints were ever formally before the Rights Commissioner they were withdrawn in the course of the first instance hearing.

The jurisdiction of a Rights Commissioner under the Act is founded upon the making of a valid complaint. If the complaint is subsequently withdrawn that jurisdiction is spent. The jurisdiction of this Court is dependent on the valid exercise by a Rights Commissioner of a jurisdiction under the Act. If the Rights Commissioner lacked jurisdiction to make a decision in relation to a particular complaint this Court can have no jurisdiction to entertain that complaint by way of appeal.

In these circumstances the Court is satisfied that the Respondent is entitled to succeed in its cross appeal against that aspect of the Rights Commissioner’s decision that found it liable to the Claimant for a contravention of s.13(1) of the Act.

Outcome

For the reasons set out herein the Court is satisfied that the within complaints are not well founded and the Claimant’s appeal cannot succeed. The Court is satisfied that the Respondent’s cross appeal must succeed. The decision of the Rights Commissioner is amended to reflect the terms of this Determination.



Signed on behalf of the Labour Court



Kevin Duffy
20th November 2014 ______________________
SC Chairman



NOTE

Enquiries concerning this Determination should be addressed to Sharon Cahill, Court Secretary.