A Named Complainant V A Named Company (Represented by Mr. Bell B.L. instructed by Martin C. Ryan & Co., Solicitors)
1.1 This dispute concerns a claim by a named complainant that the respondent (a named company) discriminated against him in terms of Sections 6(1) and 6(2)(d) of the Employment Equality Act, 1998 and in contravention of Section 8 of that Act when he was demoted in circumstances where it is alleged that he had a good performance record.
2.1 It is the complainant's contention that he was employed by the respondent and worked in a Casino. The complainant was suspended for one week following an incident which the respondent deemed inappropriate. On his return to work he was informed that he was being demoted due to his poor performance. The complainant alleges that he had a good performance record and the only reason for his demotion was his sexual orientation. The respondent denies that the complainant was an employee and states that he was a franchisee for which he paid a fee to the respondent to allow him to interact with the Casino club members who were his immediate source of income.
2.2 The complainant lodged a formal complaint with the Director of Equality Investigations on 27th September, 2001 under the Employment Equality Act, 1998. In accordance with her powers under Section 75 of that Act the Director then delegated the case to Deirdre Sweeney, Equality Officer on 7th June, 2002. For operational reasons and with the consent of Ms. Sweeney the case was reassigned in accordance with Section 75(7) of the 1998 Act to Gerardine Coyle on 3rd October, 2001 for investigation, hearing and decision and for the exercise of other relevant functions of the Director under Part VII of the Act. Submissions were received and a joint hearing took place on 7th March, 2003. franchisee. The complainant paid the respondent a fee to operate as a franchisee and payment to the complainant was by way of tips received in the club. It is the respondent's submission that the Rules of Engagement for franchisees set out necessary requirements to enable the club to function in an orderly manner e.g. start times, punctuality, conduct, appearance, etc. The respondent denies that the complainant was told that he could not take leave. As a self-employed person he could take as much leave as he so desired but he was required to give notice of proposed leave.
3. SUMMARY OF THE COMPLAINANT'S SUBMISSION
3.1 The complainant states that on 23rd March, 2001 at approximately 3.30p.m. he entered the Collossus Casino to collect his weekly wage. He says that he kissed another male who was on the casino floor and then he left. According to the complainant he returned at 11.25p.m. to commence his shift and was told to wait in the staff room. He was then summoned to the Manager's Office and was told by two managers (one male and one female) that, because of his actions, he was being suspended for a week. It was suggested to him that he use this time to consider his position with the company.
3.2 The complainant returned to work on Friday, 30th March, 2001 at 11.30p.m. and was again told to wait in the staff room. According to the complainant he was brought to the Manager's Office and confronted by the same two managers as before and told that there had been "developments" and consequently he was being demoted to dealer on £5 on hour until he could prove that he was worthy of promotion. The complainant states that he was also told that his holiday in April/May was cancelled. According to the complainant he was told that he was not focussed, was not good at his job and had a bad attitude towards the customers. It is the complainant's submission that he told the managers that this was a joke and in reply he was told that he was lucky to still have a job and that he would have to thread carefully. The complainant then left the office and completed his shift.
3.3 On Saturday, 31st March, 2001 the complainant wrote out his resignation. He called into the Casino that night and informed the Pit-boss that he would not be coming back. According to the complainant his flatmate handed in his letter of resignation to the General Manager in the Casino on Monday, 2nd April, 2001. The complainant's flatmate was told that if the complainant wanted any further correspondence he should speak to the General Manager and not involve anyone else. The complainant submits that he called the General Manager and asked him for a copy of the following:
- his contract
- his franchise
- rules of engagement and regulations
- all paperwork held on his file
- dates and times of all shifts worked, money paid and tips earned
According to the complainant he told the General Manager that he wanted this information because the way he had been treated was completely unfair and he considered the reasons he had been given to be rubbish as he had been awarded 5 grade A's, then a monthly grade C and then grade B which was the highest grades one could possible get.
The complainant did not receive this information.
3.4 The complainant states that he has no problem with getting suspended but finds it completely unacceptable that he was demoted and given pathetic reasons for the demotion. It is the complainant's contention that the respondent forced him to resign because they could not stand a male homosexual working for them. The complainant strongly believes that if he had kissed a female there would have been nothing done. He says that on one occasion the Pit-boss got sick over the desk and was sent home to sleep off the alcohol.
3.5 In conclusion the complainant states that he was a very capable dealer and inspector. His grades reflect this and he was well liked by both staff and customers. According to the complainant he was excellent at getting tips and he was never taken into the office to be disciplined. The complainant notes that he was not given a verbal warning. It is the complainant's contention that the only reason for the demotion was because of his sexual orientation.
4. SUMMARY OF THE RESPONDENT'S SUBMISSION
4.1 The respondent states that it does not appear clear the nature of the complainant's complaint. However, the respondent confirms that the complainant was not an employee at any time. According to the respondent the complainant was a franchisee for which he paid a fee to the respondent to entitle him to interact with the casino club's members who were his immediate source of income.
4.2 The respondent states that the complainant has correctly described the reasons for his demotion insofar as he identified the following:
- he was not focussed.
- he was not carrying out his duties properly.
- he had a bad attitude towards casino club members.
- he involved himself in private intimate personal contact on the premises.
The respondent, therefore, formed the view that the complainant was not properly focussed on his role arising out of a number of warnings and complaints given to him over the period of his franchise of which he is well aware and included talking, lateness, rudeness, dress code and non attendance. According to the respondent the complainant was afforded the opportunity to remedy these deficiencies.
4.3 The respondent states that Casino club members require that the matters in hand are taken with the utmost seriousness and they expect franchisees not to engage in private intimate personal contact regardless of orientation or otherwise.
5. CONCLUSIONS OF THE EQUALITY OFFICER
5.1 The issues for consideration in this claim is firstly whether or not the complainant was an employee for the purposes of the Employment Equality Act, 1998. If it is found that the complainant was an employee then the issue needs to be addressed of whether or not the respondent discriminated against him on the grounds of sexual orientation in terms of Section 6(1) and Section 6(2)(d) of the Employment Equality Act, 1998 when he was demoted from inspector to dealer. In making my decision in this claim I have taken into account all of the submissions, both written and oral, made to me by the parties.
5.2 In relation to the issue of whether or not the complainant is an employee the complainant argued that in his view he was an employee because he was told when to start and finish work, if he did not attend work 25% of his tips were deducted and he was told when he could and could not take leave. According to the complainant his performance was graded from A to C and when he received a grade A he received a bigger percentage of the tips.
5.3 The respondent denied that the complainant was an employee. According to the respondent the complainant signed a franchise agreement and was at all times a
5.4 Within the respondent structure there were dealers, dealer/inspectors, pit bosses, managers and a General Manager. The General Manager was an employee of the Company who monitored the overall running of the Club and liaised with franchisees through the managers. The General Manager reported to the owners on the running of the Club on a daily basis. According to the respondent the dealers, dealer/inspectors, pit bosses and managers were all franchisees. Managers were appointed by the respondent on the basis of their experience at the Club and the managers managed the franchisees and were responsible for making decisions as and when required.
5.5 According to the managers who were present at the hearing of this claim franchisees are paid by way of tips. Each franchisee, depending on their position, are paid a weekly wage from tips. The amount to be paid on a weekly basis is determined by the managers who stated at the hearing that the liveable wage for an inspector would differ from the liveable wage for a dealer. At the end of the month the remainder of the tips are divided among the franchisees. The grading of franchisees was determined by the managers with an input from the pit bosses and this also affected the amount of tips received by franchisees. The managers indicated at the hearing of this claim that there was no documentation available in relation to performance gradings for franchisees. The managers confirmed that the complainant, or indeed any of the other franchisees, did not receive a salary from the respondent. Rather payment to the complainant and other franchisees was based on the tips received. It is the respondent's contention that the complainant completed a self-employed tax form on becoming a franchisee declaring himself to be self-employed to the Revenue and Social Welfare.
5.6 The issue of whether a person is an employee or not has been considered by the courts in the following cases:
Henry Denny & Sons (Ireland) Limited t/a Kerry Foods v The Minister for Social Welfare2
In this case the Supreme Court considered the difference between a contract of service and a contract for services and the issue concerned whether shop merchandisers are employees or not. In holding that the merchandiser was an employee Keane J. considered 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. The degree of control exercised over how the work is to be performed, although a factor to be taken
into account, is not decisive."
E.P. Ó Coindealbháin (Inspectors of Taxes) v Mooney3
The difference between a contract of service and a contract for services was considered by Blayney J who held that "where the agreement creating the relationship between the parties is expressed in writing ... the entire agreement between the parties is to be found in the writing, so it is the unique source of their relationship: it follows that it is from
its terms alone that the nature of the relationship can be determined."
The Employment Appeals Tribunal also considers issues such as whether the "employee" receives holidays, sick pay and pensions. A person who receives such benefits, it may be assumed, is an employee working under a contract of service.
5.7 Having regard to the facts of this case and mindful of the case law relating to the issue of employees or otherwise I find that the complainant was a franchisee and not an employee. All payments to the complainant were as a result of tips generated in the Club. The complainant could choose to work or not to work. He could take holidays as and when he so desired and he received no payment in the form of tips when on leave, be it holiday or sick leave. Any controls (in accordance with the Rules of Engagement to facilitate the proper running of the Club) exercised over the complainant were enforced by other franchisees and not by the respondent. On becoming a franchisee the complainant declared himself to be self-employed to the Revenue and Social Welfare and the manner of his work reflected this status.
5.8 As I have found at paragraph 5.7 above that the complainant was not an employee it is not necessary for me to examine the substantive issue of his claim as he is not covered by the provisions of the Employment Equality Act, 1998.
6.1 In view of the foregoing I find that the named complainant was a franchisee and not an employee hence he is not covered by the provisions of the Employment Equality Act, 1998.
2nd April, 2003
2Supreme Court ( IR 34)
3High Court ( IR 422)