RPD2213

1. Appeal Of Adjudication Officer Decision No ADJ-00033638.


BACKGROUND:

2. The Respondent appealed the decision of the Adjudication Officer on 23 June 2022 under the Redundancy Payments Acts, 1967 to 2014. A Labour Court hearing took place on 20 October 2022. The following is the Determination of the Court:





DETERMINATION:

This is an appeal by Dr David Ross (Respondent)) against Adjudication Officer’s Decision ADJ-00033638 in a complaint by Edel O Brien (Complainant) under the Redundancy Payments Act 1967(the Act). The Adjudication Officer held that the claim by the Complainant for redundancy under the Act was well founded and awarded statutory redundancy.

Background to the Appeal:

The Complainant worked for the Respondent as a practice nurse from 6^th March 2009. In and around October 2021 the Respondent indicated to the Complainant that he was giving notice to the HSE of his intention to resign. The Respondent ceased the practise on the 31^st January 2021 and the GMS list went back to the HSE. The Complainant is seeking redundancy payment. The Respondent’s position is that no redundancy arises as she was transferred to either the HSE or the Agency that is currently employing her albeit on a temporary basis.

Summary of Complainant’s case:

Mr Duncan representative for the Complainant submitted that she was informed by the Respondent that he was retiring his GMS contract and that by emails of the 6th and 7^th of January 2021 he advised her that her employment would transfer to the HSE / temporary operator and that she would maintain her existing terms and conditions of employment. The Complainant then made contact with the HSE on the 12^th January 2021 and was advised by the HSE that what was occurring was not a transfer of undertakings and that her employment rights and terms and conditions would not transfer.

In and around that date the HSE wrote confirming that in order to maintain the service the HSE would be recruiting a locum GP through an agency and that she would be offered a three-month temporary contract through an agency. The Complainant wrote to the Respondent on the 28^th January 2021 advising that because there was no transfer of undertaking, she was entitled to statutory redundancy and requesting that same be actioned. This was followed up by a letter from her representative on the 17^th February 2021 again requesting that statutory redundancy as due be paid.

The Respondent’s representative responded by letter of 24^th February 2021 advising that it was their position that no redundancy occurred and that as a matter of law the Complainant’s employment had transferred.

Mr Duncan submitted that the Complainant’s contract was at all times with Dr Ross and when his contract with the HSE terminated on the 31^st January 2021 her contract with him also terminated. In effect she was dismissed as her position with the Respondent no longer existed which clearly meets the criteria for redundancy. The Respondent has accepted that the defence under section 9(3) of the Act is not available to him and nor is he seeking to avail of that defence. The Respondent submits that he is not restricted to the defence set out in the legislation and that their position is that a transfer of undertakings occurred therefore the issue of redundancy does not arise. For a transfer of undertakings to occur an ‘economic entity’ has to have transferred and that did not occur in this case. It is of significance that the Respondent cannot identify who the Complainant is alleged to have been transferred to.

Summary of Respondent’s case:

Mr Mac Sweeney representative for the Respondent submitted that the Respondent operated the Kilconnell Health Centre from July 2007 until the 31^st January 2021 having taken over the practise from a Dr Twohig. The Complainant was employed as a practice nurse working three mornings per week. To the best of the Respondents knowledge the Complainant continues to work from the same location on the same terms and conditions of employment.

The Respondent operated as a sole trader running the medical centre. He was awarded a General Medical Scheme list by the HSE (640 patients on average) and the practice had circa 600 private patients. He occupied the premises rent free. When he took over the practice it was fully furnished and included things such as medical equipment and client files. He signed a contract with the HSE to run the practise.

By email of the 5^th October 2020 the Respondent wrote to a Mr Broderick HSE advising “I am writing to give my resignation as principal GP from Kilconnell Health Centre. I will work my statutory notice as per my contract.”

The Respondent informed the Complainant of his decision on the 7^th October 2020 and of his understanding that the HSE would run a competition to appoint a replacement GP.

On the 6^th January 2021 the Respondent spoke with Mr Broderick who advised him that at that point in time no GP had expressed an interest in taking up the post and therefore the HSE would have to arrange for the engagement of a temporary locum through an agency. It was his understanding from that conversation that a different agency would be used to retain the services of the Complainant and that she would retain her terms and conditions of employment. The Respondent by letter of the 6^th January wrote to the Complainant setting this out.

It is the Respondent’s case that he transferred the Kilconnell Health Centre practise to the HSE or a temporary operator. It is accepted that the transfer did not take the form of a legal assignment and there were no written agreement or document and did not involve a formal legal transfer of goodwill and or liabilities. However, it is submitted that it stills falls within the criteria for a transfer as contained in the Transfer of Undertakings Regulations. Mr Mac Sweeney submitted that the Complaint was not dismissed by the Respondent and continues to work at the same location.

The Respondent set out in bullet point form eleven ‘transfers’ that he submitted were affected including transfer of, the premises, the name of the practise, the patients and their files, the telephone number of then practice, the email address, furniture, computers (some of which he had purchased) a client file management contract with a third party and the staff.

It was his submission that the transfer was to the HSE or its temporary operator. It is his submissions that the practise retained its identity and continues to run in the precisely the same manner albeit under the guidance of a different GP. The Respondent submitted that they were relying on regulation 3(2) and regulation 4(1) of S. I. No.131 of 2003 European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003 and on the findings of the Court of Justice in Suzen v Zehnacker Gebaudereinigung ( C-13/95) (Suzen case) and Siguena v Ayuntamiento de Valladolid, In-Pulso Musical Sociedad Cooperativa & others (2009). The Respondent also identified Irish caselaw where these principles have applied. Mr Mac Sweeney submitted that he disagreed with the reasoning in caselaw identified by the Complainant. In respect of the defence provided for by section 9 of the Act the Respondent is not seeking to rely on that defence.

The applicable Law:

S. I. No.131 of 2003 European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003

Regulation 3;

• (1) These Regulations shall apply to any transfer of an undertaking, business, or part of an undertaking or business from one employer to another employer as a result of a legal transfer (including the assignment or forfeiture of a lease) or merger.

  (2) Subject to this Regulation, in these Regulations—
  “transfer” means the transfer of an economic entity which retains its identity;
  “economic entity” means an organised grouping of resources which has the objective of pursuing an economic activity whether or not that activity is for profit or whether it is central or ancillary to another economic or administrative entity.
  (3) These Regulations shall apply to public and private undertakings engaged in economic activities whether or not they are operating for gain.

• (1) The transferor's rights and obligations arising from a contract of employment existing on the date of a transfer shall, by reason of such transfer, be transferred to the transferee.

• 7.—(1) An employee, if he is dismissed by his employer by reason of redundancy or is laid off or kept on short-time for the minimum period, shall, subject to this Act, be entitled to the payment of moneys which shall be known (and are in this Act referred to) as redundancy payment provided—

  (a) he has been employed for the requisite period, and

  (b) he was an employed contributor in employment which was insurable for all benefits under the Social Welfare Acts, 1952 to 1966, immediately before the date of the termination of his employment or, had ceased to be ordinarily employed in employment which was so insurable in the period of two years ending on that date.

  (2) For the purposes of subsection (1), an employee who is dismissed shall be taken to be dismissed by reason of redundancy if the dismissal is attributable wholly or mainly to—

  (a) the fact that his employer has ceased, or intends to cease, to carry on the business for the purposes of which the employee was employed by him, or has ceased or intends to cease, to carry on that business in the place where the employee was so employed, or

• (1) For the purposes of this Part an employee shall, subject to this Part, be taken to be dismissed by his employer if but only if–
  (a) the contract under which he is employed by the employer is terminated by the employer, whether by or without notice, or
  [(b) where, under the contract under which the employee is employed by the employer the employee is employed for a fixed term or for a specified purpose (being a purpose of such a kind that the duration of that contract was limited but was, at the time of its making, incapable of precise ascertainment), that term expires or that purpose ceases without being renewed under the same or similar contract, or]
  (c) the employee terminates the contract under which he is employed by the employer [ … ] in circumstances (not falling within subsection (5)) such that he is entitled so to terminate it by reason of the employer's conduct.
  (2) An employee shall not be taken for the purposes of this Part to be dismissed by his employer if his contract of employment is renewed, or he is re-engaged by the same employer under a new contract of employment, and—
  (a) in a case where the provisions of the contract as renewed or of the new contract as to the capacity and place in which he is employed, and as to the other terms and conditions of his employment, do not differ from the corresponding provisions of the previous contract, the renewal or reengagement takes effect immediately on the ending of his employment under the previous contract, or
  (b) in any other case, the renewal or re-engagement is in pursuance of an offer in writing made by his employer before the ending of his employment under the previous contract, and takes effect either immediately on the ending of that employment or after an interval of not more than four weeks thereafter.
  (3)
  (a) An employee shall not be taken for the purposes of this Part as having been dismissed by his employer if–
  (i) he is re-engaged by another employer (hereinafter referred to as the new employer) immediately on the termination of his previous employment,
  (ii) the re-engagement takes place with the agreement of the employee, the previous employer and the new employer,
  (iii) before the commencement of the period of employment with the new employer the employee receives a statement in writing on behalf of the previous employer and the new employer which–
  (A) sets out the terms and conditions of the employee's contract of employment with the new employer,
  (B) specifies that the employee's period of service with the previous employer will, for the purposes of this Act, be regarded by the new employer as service with the new employer,
  (C) contains particulars of the services mentioned in clause (B), and
  (D) the employee notifies in writing the new employer that the employee accepts the statement required by this sub-paragraph.
  (b) Where in accordance with this subsection an employee is re-engaged by the new employer, the service of that employee [with the previous employer] shall for the purposes of this Act be deemed to be service with the new employer.
  

The Respondent noted the defence set out in section 9 (3) of the Act and confirmed that he had not followed the procedures set out therein and therefore was not seeking to rely on same.

The following facts were not in dispute.

that the Respondent had notified the HSE that he was resigning his post

that he had worked his notice period,

that when he took up the post the HSE had supplied him with a client list, client files, the premises equipped with office furniture and medical instruments.

that there was no legal transfer of goodwill or liabilities and

that the Respondent confirmed they were unable to say who specifically the undertaking was transferred to.

Regulation 3 (2) as set out above defines a transfer as “the transfer of an economic entity which retains its identity. An “economic entity” is defined in the Regulations as “an organised grouping of resources which has the objective of pursuing an economic activity whether or not that activity is for profit or whether it is central or ancillary to another economic or administrative entity.”

In the case to hand the Respondent listed a number of items such as premises (which he had use of rent free) email address, phone number, etcetera, which he submitted transferred to either the HSE or a temporary operator. The Court finds that these items in and off themselves, do not constitute an economic entity as defined by the Regulations as set out above. In effect the Complainant returned to the HSE (with some small exceptions) the items that had been made available to him when he took up the position. The Court determines that the Respondent has failed to identify an economic entity that transferred and therefore no transfer of undertakings as defined by the Regulations set out above, occurred.

Section 7 (2) (a) of the Act, provides that a dismissal may be by way of redundancy if the employer has ceased to carry on the business for which the employees were employed. It is clear from the facts of this case that is what occurred and that the termination of the employment constituted a redundancy.

The Court determines that the Complainants employment terminated when the Respondent’s contract with the HSE came to an end. This termination constituted a redundancy that qualifies the Complainant to receive a statutory redundancy payment within the meaning of the Act. The decision of the Adjudication Officer is upheld.

The Court so Determines

	Signed on behalf of the Labour Court
	Louise O'Donnell
SL	______________________
06 December 2022	Deputy Chairman