SECTION 15(1), PROTECTION OF EMPLOYEES (FIXED-TERM WORK) ACT, 2003
UNIVERSITY COLLEGE HOSPITAL GALWAY
(REPRESENTED BY WILLIAM B GLYNN)
- AND -
(REPRESENTED BY IRISH MEDICAL ORGANISATION)
Chairman: Mr Duffy
Employer Member: Mr Doherty
Worker Member: Mr O'Neill
1. Appeal against a Rights Commissioner's Decision
2. The Employer appealed the Rights Commissioner's Decision to the Labour Court on the 10th November, 2006. A Labour Court hearing took place on the 18th January, 2007.
This is an appeal by University College Hospital Galway (the Respondent) against the decision of a Rights Commissioner in a complaint by Dr Masud Awan (the Claimant) made under the Protection of Employees (Fixed-Term Work) Act 2003 (Act). The Claimant was employed by the Respondent in his capacity as a consultant anaesthetist between January 1999 and June 2004 on a succession of fixed-term contracts as follows: -
- Commencement End
18th January 1999 30th June 1999
1st July 1999 31st December 1999
1st January 2000 30th June 2000
1st July 2000 31st December 2000
1st January 2001 30th June 2001
1st July 2001 31st December 2001.
1st January 2002 30th June 2002
1st July 2002 31st December 2002.
1st January 2003 30th June 2003
1st July 2003 31st December 2003.
1st January 2004 30th March 2004
1st April 2004 30th June 2004
The substance of the Claimant’s case is that he became entitled to a contract of indefinite duration pursuant to s 9 of the Act which the Respondent refused to recognise. He further complained that the Respondent failed to provide him with a written statement of the objective reasons relied upon in renewing his fixed-term contracts in contravention of s 9 of the Act. The Claimant also submitted that he was treated less favourably than a comparable permanent employee, in contravention of s 6 of the Act, when the Respondent advertised the post which he held and required him to apply for that post in open competition. Finally, the Claimant contended that he was victimised by the Respondent when it failed to renew his fixed-term contract in June 2004.
The Rights Commissioner found that the Claimant had become entitled to a contract of indefinite duration with effect from 1st January 2004. She directed that the Respondent reinstate him with effect from 1st January 2004 on a contract of indefinite duration on the full terms of the common contract for consultants and without loss of pay. The Respondent appealed to this Court.
Position of the Parties
While various issues were raised by the parties in their submissions there was consensus that the central issue for determination is whether the Claimant became entitled to a contract of indefinite duration pursuant to s 9(3) of the Act. This in turn centred on whether there were objective reasons, within the meaning of s 7 of the Act, justifying the renewal of the Claimant’s fixed-term contract beyond what is ordinarily permissible by s 9(1) of the Act. The Respondent also put in issue the appropriateness of the redress ordered by the Rights Commissioner, namely reinstatement without loss of pay. It was agreed that these were the only issues which the Court needed to determine.
Summary of the Respondent’s submission
The Respondent submitted that the appointment of consultant doctors in the public health sector is governed by a number of statutory provision and in particular by the Local Authority (Officers and Employees) Act 1926 and the Health Act 1970. It was submitted that at the time material to this case various provisions of these statutes precluded Health Boards from making appointments to permanent positions other than on the nomination of the Local Appointments Commission following public competition. It was submitted that as the Respondent is a creature of statute it must comply with the statute by which it is created and it thus had no legal authority to appoint the Claimant to a permanent post without following the procedure set out in the relevant statutes. It was submitted that the constraints imposed on the Respondent in that regard constituted objective reasons for the continued renewal of his employment for a fixed-term and for not offering him a contract of indefinite duration.
With regard to the redress ordered by the Rights Commissioner the Respondent pointed out that the Claimant had obtained an alternative appointment in Monaghan General Hospital immediately following the termination of his fixed-term contract. In these circumstances the Respondent submitted that an award of reinstatement in the disputed post without loss of pay would amount to an unjust enrichment of the Claimant.
Summary of the Claimant’s submission
The Claimant contended that he became entitled to a contract of indefinite duration by operation of law with effect from 1st January 2004. He had written to the Respondent asking that his status as a permanent office holder be recognised. The Respondent refused to acknowledge that his contract of employment had been converted to one of indefinite duration and had proceeded to advertise and fill his post by open competition. The Claimant had declined to participate in that competition because he believed that he was already legally entitled to hold the post permanently.
The Claimant contended that the Respondent had not provided him with a statement setting out the objective grounds upon which it relied renewing his employment for a fixed-term or for not offering him a contract of indefinite duration. The Claimant also submitted that as a matter of European and domestic law the statutory provision relied upon by the Respondent are incapable of constituting objective reasons for not complying with s 9 of the Act.
On the redress ordered by the Rights Commissioner, the Claimant submitted that he has suffered considerable loss inconvenience and expense arising from the Respondent’s failure to retain him in employment at Galway University Hospital. This included the expenses and disruption associated with relocating himself and his family to Monaghan, the loss of opportunities to earn private fee income and the loss of the professional standing and prestige associated with working at a university hospital. In these circumstances, it was submitted, the award made by the Rights Commissioner was not excessive.
Conclusions of the Court.
Section 9 of the Act provides as follows: -
- 9.—(1) Subject to subsection (4), where on or after the passing of this Act a fixed-term employee completes or has completed his or her third year of continuous employment with his or her employer or associated employer, his or her fixed-term contract may be renewed by that employer on only one occasion and any such renewal shall be for a fixed term of no longer than one year.
(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 4 years.
(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.
(4) Subsections (1) to (3) shall not apply to the renewal of a contract of employment for a fixed term where there are objective grounds justifying such a renewal.
(5) The First Schedule to the Minimum Notice and Terms of Employment Acts 1973 to 2001 shall apply for the purpose of ascertaining the period of service of an employee and whether that service has been continuous.
The effect of subsection (3) of this Section is that where a fixed-term contract is renewed in contravention of subsection (1) or (2), the offending term is rendered voidab initoand the contract is converted to one of indefinite duration by operation of law (see the Determination of this Court inHealth Service Executive North Eastern Area v Khan17 E.L.R. 313.). However the renewal of a fixed-term contract which isprima faciein contravention of s 9(1) or (2) can be saved by s 9(4) where there are objective grounds justifying its further renewal.
What constitutes objective ground for this purpose is circumscribed by s 7(1) which provides as follows: -
- “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”.
It is common case that the Claimant had completed his third year of continuous fixed-term employment when the Act was enacted (14th July 2003). Thus, the Respondent was entitled thereafter to renew his fixed-term contract once and once only and for a period not exceeding one year. The first renewal of the Claimant’s fixed-term contract after the passing of the Act was on 1st October 2003 and that contract was to expire on 31st December 2003. However the Respondent purported to further renew the Claimants contract for a fixed-term on 1st January 2004. That purported renewal contravened of s 9(1) unless it was saved by s 9(4).
In advancing the argument that the renewal of the Claimant’s contract for a second fixed-term was saved by s 9(4) of the Act, the Respondent relied on the provisions relating to the appointment of consultants contained in the statutes previously referred to. The gist of the Respondent’s case is that those statutory provisions prevented it from converting the Claimant’s fixed-term contract into one of indefinite duration. This defence amounts in reality to an assertion that the constraints placed on the Respondent’s capacity to fill permanent posts by the Local Authority (Officers and Employees) Act 1926 and the Health Act 1970 off-set or supplant its obligations to comply with section 9 of the Act of 2003. This line of argument cannot be accepted.
The Act of 2003 was enacted to fulfil the States obligation to implement in domestic law Directive 1999/70/EC of the 28th June 1999 concerning the Framework Agreement on Fixed-Term Work concluded by ETUC, UNICE and CEEP. This is clear from the long title of the Act. It is settled beyond argument that where a conflict arises between a provision of purely domestic law and a Community law provision, the law of the Community must prevail. This is the clear import of the doctrine of supremacy of Community law first developed by the ECJ in C-6/64Costa v ENEL ECR 589. The practical requirements of this doctrine were set down in emphatic terms by the Court of Justice in C- 106/77Amministrazione delle Finanze dello Stato v Simmenthal ECR629 when it said the following: -
“Every national court must, in a case within its jurisdiction, apply community law in its entirety and protect rights which the latter confers on individuals and must accordingly set aside any provision of national law which may conflict with it, whether prior or subsequent to the community rule.”
Furthermore, the line of argument advanced by the Respondent in this case on the effects of the earlier statutes were recently rejected by the High Court inAhmed v Health Service Executive, High Court, Unreported, Leffoy J. 6th July 2006. The material facts of that case can be briefly stated. The Plaintiff was employed by the Defendant’s predecessor, the North Eastern Health Board, as a locum consultant surgeon at Louth County Hospital. His employment was on a succession of fixed-term contracts commencing in July 2000. In October 2003 the Local Appointments Commission advertised for three permanent posts of consultant surgeon with the Defendant’s predecessor in Dundalk. The Plaintiff applied for one of the posts but was successful. In August 2004 the Defendant purported to terminate the Defendants temporary appointment so as to make way for one of the successful applicants. Following correspondence from the Plaintiff’s Solicitors it was accepted that by operation of s9(3) of the 2003 Act his contract had become one of indefinite duration with effect from 30th June 2004. The Defendant, however, proposed transferring the Plaintiff to fill temporary positions at other locations. The Plaintiff resisted the Defendant’s moves and claimed that since he had been originally appointed to Louth County Hospital he was contractually entitled to continue working there on a permanent basis. The Defendant countered that it was constrained in making appointments to permanent posts of the type at issue by the Local Authorities (Officers and Employees) Act, 1926. In addressing that submission Leffoy J. had this to say: -
- First, the defendant submitted that it was, and remains, constrained in the manner in which it may assign the plaintiff to a post by the statutory provisions which govern the appointment of permanent consultants. The statutory provisions invoked are the provisions of the Local Authorities (Officers and Employees) Act, 1926 (the Act of 1926) which regulate selection of persons for appointment to certain offices to which the Act applies. In the past, in general, selection was by means of a competitive examination conducted by the Local Appointments Commission until its dissolution by the Public Service Management (Recruitment and Appointments) Act, 2004 (the Act of 2004). Currently, recruitment for appointment to positions in the defendant’s organisation to which the Act of 1926 applies is subject to that Act and the subsequent amendments thereof, including the provisions of the Act of 2004 amending it, and it is regulated by the Commission for Public Service Appointments established by the Act of 2004. There is inherent in the defendant’s submission the proposition that, by seeking to enforce his rights under s. 9 of the Act of 2003, the plaintiff is seeking to compel the defendant to circumvent the provisions of the Act of 1926, as amended by the Act of 2004, or, alternatively, the proposition that it is a necessary corollary to the enforcement of the plaintiff’s right that such circumvention would occur and that such circumvention would be ultra vires the powers of the defendant. In my view, neither proposition is correct. The plaintiff is not seeking to be appointed to an office the filling of which is governed by the Act of 1926. The defendant must comply with the provisions of the Act of 2003 and such compliance falls outside the ambit of the Act of 1926. That, it seems to me, is a sufficient answer to this point without having to go into the minutiae of the provisions of the Act of 1926, as amended.”
As inAhmed v Health Service Executive, and contrary to the construction placed on his claim by the Respondent, the Claimant is not seeking to be appointed to a post to which the Act of 1926 or the Act of 1970 relates. The import of his claim is that the post, which he had held since 1999 on a succession of fixed-term contracts, became one of indefinite duration by operation of law on 1st January. Therefore, if he is correct on that point, the question of appointing him to the post did not arise as he became confirmed in that post by virtue of s 9(3) of the Act unless there are objective reasons for not applying that provision.
The extent to which national legislative measures can be relied upon as objective reasons for derogating from the obligations imposed by the Directive on which the Act is based was recently considered by the ECJ in C-212/04Adeneler v Ellinikos Organismos GalaktosIRLR 716 ECJ. In its judgement the Court first emphasised that the 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 capable in that particular context of justifying the use of successive fixed-term employment contracts (see paragraph 69 of the Judgment). The Court then had this to say: -
[C]lause 5(1)(a) of the Framework Agreement is to be interpreted as precluding the use of successive fixed-term employment contracts where the justification advanced for their use is solely that it is provided for by a general provision of statute or secondary legislation of a Member State. On the contrary, the concept of ‘objective reasons’ within the meaning of that clause requires recourse to this particular type of employment relationship, as provided for by national legislation, to be justified by the presence of specific factors relating in particular to the activity in question and the conditions under which it is carried out.
While the facts of the instant case are not entirely congruent with those inAdeneler, the passage quoted is, it seems to the Court, clear authority for the proposition that domestic legislative provisions cannot in themselves provide objective reasons for not complying with the obligations imposed by Clause 5 of the Framework Agreement, which corresponds to s 9 of the Act.
Having regard to the foregoing the Court is satisfied that neither the provisions of the Local Authority (Officers and Employees) Act 1926 nor those of the Health Act 1970 constituted objective reasons for renewing the Claimant’s contract on 1st January 2004 for a further fixed-term. It follows that the said renewal contravened s 9(1) of the Act, in consequence of which the contract became one of indefinite duration by operation of s 9(3) of the Act. Accordingly the Rights Commissioner was correct in upholding the Claimant’s complaint under the Act and that decision is affirmed.
It is accepted that since the termination of his employment with University College Hospital Galway, the Claimant has been employed in Monaghan General Hospital (and latterly in Letterkenny Hospital) on the same salary as that applicable to the post in Galway. Given the amount of time which has elapsed since the matter was referred to the Rights Commissioner the Court accepts that an order for reinstatement without loss of pay is not the most appropriate redress in the circumstances. The Court does, however, accept that the Claimant did suffer considerable loss, inconvenience and expense in having to relocate to Monaghan. The Court is also satisfied that the Claimant suffered further loss arising from his diminished potential to earn private fee income in Monaghan Hospital relative to that available in Galway.
The Court believes that the appropriate form of redress in this case is an order directing that the Claimant be reengaged in the post which he held in University College Hospital Galway, on the Consultants Common Contract, with effect from 1st May 2007 but without loss of his prior service. The Court is also satisfied that the Claimant is entitled to an award of compensation pursuant to s 14(2)(d) of the Act in an amount which is just and equitable having regard to all the circumstances of the case. The Court does not propose to fix the quantum of compensation to which the Claimant is entitled at this time. It will adjourn this aspect of the case so as to afford the parties an opportunity to negotiate on the matter. If agreement is not reached the Court will make a further order fixing the quantum of compensation on application being made to it in that behalf and on hearing such submissions as the parties wish to make.
The Decision of the Rights Commissioner in upholding the complaint herein is affirmed. The redress ordered in varied in the terms set out in this Determination.
Signed on behalf of the Labour Court
5th February , 2007______________________
Enquiries concerning this Determination should be addressed to Madelon Geoghegan, Court Secretary.