Complainant

Respondent

Parties

Declan Langan

Klass Oil Distributors Limited t/a Klass Oil

Representatives

David Joseph Smith BL instructed by Healy Law Monaghan

 Peninsula

Act

Complaint/Dispute Reference No.

Date of Receipt

Complaint seeking adjudication by the Workplace Relations Commission under Section 8 of the Unfair Dismissals Act, 1977

CA-00060959-001

12/01/2024

Complaint seeking adjudication by the Workplace Relations Commission under Regulation 10 of the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003 (S.I. No. 131 of 2003)

CA-00060959-002

12/01/2024

Complaint seeking adjudication by the Workplace Relations Commission under Regulation 10 of the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003 (S.I. No. 131 of 2003)

CA-00060959-004

12/01/2024

Complaint seeking adjudication by the Workplace Relations Commission under Regulation 10 of the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003 (S.I. No. 131 of 2003)

CA-00060959-006

12/01/2024

Complaint seeking adjudication by the Workplace Relations Commission under Regulation 10 of the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003 (S.I. No. 131 of 2003)

CA-00060959-007

12/01/2024

Complaint seeking adjudication by the Workplace Relations Commission under Regulation 10 of the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003 (S.I. No. 131 of 2003)

CA-00060959-013

12/01/2024

Complaint seeking adjudication by the Workplace Relations Commission under section 7 of the Terms of Employment (Information) Act, 1994

CA-00060959-015

12/01/2024

The Complainant gave evidence on affirmation.

Mr Vincent Kirrane MD of Klass Oil and Mr John Hughes Operations Manager of Klass Oil both gave evidence on affirmation. It was submitted by the Respondent that it ceased trading in 2020.

The name of the Respondent was confirmed as Klass Oil Distributors Limited.

The parties confirmed the Complainant earned an average weekly wage of €823.47 gross per week.

It was the Complainant’s evidence that he commenced employment on 20 September 2021 with a termination date of 10 November 2023. The Complaint Form was received by the Workplace Relations Commission on 12 January 2024.

CA-00060959-001 – Unfair Dismissal

It was the Complainant’s evidence that up until 23 September 2023, he worked with a company called McMullen Oil. He would start at 8:00 or 8:30 AM until 5:00 PM. He described loving his job.

On 23 September, the Complainant was asked by Harry, who worked for McMullen Oil, if he could do a load early in the morning. At 7:20 AM, two men, one of which was Mr. Kirrane, came over to him and told him that they were the new owners, and everything was going to remain the same. That evening, he returned to the yard and met with Harry McMullen. They had tea and buns, and he described it as the last time he met Harry.

The Complainant described in his evidence doing additional loads further away. In response, he asked for a contract of employment. The Respondent provided him with a contract which stated a lower rate of pay. It was his evidence that he was earning €675 from Harry McMullen, but the new contract only provided for €600 per week. He also pointed out Clause 10, which related to deductions from his wages, as being different from his previous employment.

On 6 November 2023, he was called by the Respondent and asked about the contract. He highlighted both clauses and requested that they be removed. This was refused, and he was told that he could “finish up on Friday.” It was the Complainant’s evidence that he was working a lot more hours and doing work that was not contracted to McMullen Oil.

The Complainant gave evidence that on 3 December 2023, he took up a new temporary position before taking up permanent employment on 22 January 2024, in which he earns €725 net. It was his evidence that he was out of work for nine weeks.

Upon cross-examination, the Complainant was asked if he had resigned, with it being put to him that it would be the Respondent’s evidence that he had resigned three times.

The Complainant was asked whether he was ever told that he was now working for the Respondent, and he stated that, yes, on 23 September 2023, that is what the new owners told him. He added that on 23 September 2023, he received his last text message from Harry McMullen.

The Complainant was asked how his request for a new contract came about, and his response was that he asked for more money as he was doing more loads, approximately in October 2023.

Two payslips were put to the Complainant from week 42 and week 43, and it was suggested to him that there was a substantial increase in his wages. Similarly, a third for week 44 also showed an increase in his wages. It was put to him that at all times he remained an employee of McMullen Oil, but in response, the Complainant stated that all the loads he carried were for a company not associated with McMullen Oil.

It was put to the Complainant that, in his evidence, he had said John Hughes told him to sign the contract or leave. In response, the Complainant's evidence was that this was 100% correct. On 6 November 2023, over the telephone, John Hughes told him this. He was then asked why he would need a new contract if there was a transfer. The Complainant’s evidence was that he did not agree with two clauses, including the deduction-from-pay agreement.

When 10 November 2023, came about, he returned to the yard and handed back the keys, which he left in the office. It was his evidence that no one contacted him after he text John Hughes, stating he had returned the keys. It was put to him that this was a significant step to take, and in response, the Complainant stated, “I just didn’t think he would go through with it. There is a shortage of drivers.”

The Complainant was asked about his mitigation of loss, it was the Complainant’s evidence that he worked from 3 December 2023 periodically until 22 January 2024 and earned between €199 and €1,884. He also stated that he did not receive any public holiday pay during that time, and all those figures were net. He then obtained full-time employment on 22 January 2024 at a rate of €725 net per week.

CA-00060959-002 – TUPE 

The Complainant gave evidence that the Respondent did not ensure terms and conditions were transferred. In particular, he referred to the payment and deductions clauses.

CA-00060959-004 – TUPE

The Complainant gave evidence that the Respondent failed to observe the terms and conditions of employment that he held with McMullen Oil. In particular, he referred to the payment and deductions clauses.

CA-00060959-006

The Complainant withdrew this complaint at the hearing.

CA-00060959-007

The Complainant withdrew this complaint at the hearing.

CA-00060959-013

The Complainant withdrew this complaint at the hearing.

CA-00060959-015

The Complainant withdrew this complaint at the hearing.

Legal Submissions

On behalf of the Complainant, it was submitted that the actions of the new owners contravened the protections under the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003, in particular Regulation 5 which prohibits the imposition of new conditions without proper consultation or agreement and provides that:

"If a contract of employment is terminated because the transfer involves a substantial change in working conditions to the detriment of the employee concerned, the employer concerned shall be regarded as having been responsible for the termination of the contract of employment.”

The Complainant relied on Mythen v. The Employment Appeals Tribunal [1990] E.L.R. 1.

It was submitted that the Complainant's employment with McMullen Oils Limited transferred to the Respondent pursuant to Regulation 3(1), without prior consultation. It further submitted that the Respondent appeared to seek to rely on two contradictory assertions, that they were not the employer while simultaneously managing employment terms and conditions.

Under Regulation 3(1), the rights and obligations arising from a contract of employment or employment relationship existing on the date of a transfer are transferred to the transferee. This provision ensures that employees retain their contractual rights despite a change in the ownership of the business. It was further submitted that the transfer of undertaking from McMullen Oils to the Respondent was evidenced by their introduction to the Complainant as the new proprietors and subsequent actions. Notwithstanding the above, whether or not there has been a change in ownership is not relevant. The Complainant relied upon the ECJ judgment in Daddy’s Dance Hall A/S [1988] I.R.L.R. 315:

"The Directive therefore applies as soon as there is a change, resulting from a conventional sale or from a merger, of the natural or legal person responsible for operating the undertaking who consequently enters into obligations as an employer towards the employees working in the undertaking and it is of no importance to know whether the ownership of the undertaking has been transferred."

CA-00060959-001 – Unfair Dismissal

Mr Vincent Kirrane evidence that Klass Oil purchased McMullen Oil on 28 or 29 September 2023. When asked how many people were employed, his response was that there were six. He stated that all six remained employees of McMullen Oil.

Counsel, for the Complainant, put it to the witness that it was his position that the Complainant was never employed by Klass Oil. In response, the witness stated that no, the Complainant was only ever employed by McMullen Oil. He confirmed that he did offer him employment and, when asked which would commence “straight away.”

It was Mr. Kirrane’s evidence that shares in the business, McMullen Oil, were purchased. The premises were leased, and Mr. McMullen resigned his directorship. He stated that the name of the business remained the same.

Mr. John Hughes, the Operations Manager, gave evidence that he was responsible for recruitment, and it was very difficult to find drivers. In relation to the Complainant, his evidence was that he had previously tendered his resignation, but he did not have the exact dates. However, he noted that the Complainant was unhappy about the sale of McMullen Oil to the Respondent. He described the Complainant as an excellent driver.

On 23 September 2023, the Complainant resigned on the date of the takeover for the second time. On the final occasion, he resigned verbally over the phone, and Mr. Hughes accepted his resignation.

Mr. Hughes was asked whether he told the Complainant to sign the contract or leave his employment. In response, the witness stated that he explained that the Complainant would need to sign the contract if he wished to work for the Respondent. He further explained that there was a trial period, during which the Complainant benefited from higher wages.

Upon cross-examination, Mr. Hughes was asked if there was a difference in the terms and conditions in the contract provided to the Complainant. His evidence was that yes, the terms were enhanced. It was then put to him that there was also more liability, which he accepted.

When asked why he did not call the Complainant after his resignation, particularly given his evidence that it was very hard to find drivers, Mr. Hughes stated that he made a call after the first resignation but not after the third time.

Mr. Hughes was asked about the commencement date on the contract he provided to the Complainant, which was noted as 20 September 2021, the Complainant’s original start date. His evidence was that this was to ensure continuity of service for the Complainant.

Upon inquiry, the witness was asked about the trial period, particularly in relation to the payslips for Week 42 and Week 43. His evidence was that Week 42 amounted to €827, which was based on the Complainant’s original terms. However, Week 43 showed enhanced earnings, and he emphasised to the Complainant that he could have earned more money on commission with the Respondent. He explained that the contract of employment provided for an amount based on bulk loads and that there was an incentive for the driver to complete more work. His evidence was that the trial period was intended to demonstrate that the Complainant could earn more, but the Complainant took issue with Clause 10 in the contract.

In relation to the resignation, the witness stated that the Complainant initially advised the Respondent that the role was not working out, but following a discussion, he was persuaded to stay, which led to the implementation of the trial period. However, on the third occasion that the Complainant resigned, his resignation was accepted.

CA-00060959-002 – TUPE 

It was submitted on behalf of the Respondent that no transfer of any entity took place during the trial period. It was further submitted that the complaint regarding the terms and conditions of employment was not valid, as the contract was neither signed nor dated by the Respondent, which is a requirement under the legislation. A copy of the contract was given to the Complainant to allow him to better understand what his terms and conditions would have been had he accepted the offer.

CA-00060959-004 – TUPE

It was again submitted on behalf of the Respondent that no transfer of any entity took place during the trial period and the contract of employment offered was not valid, as the contract was neither signed nor dated by the Respondent, which is a requirement under the legislation.

CA-00060959-006

The Complainant withdrew this complaint at the hearing.

CA-00060959-007

The Complainant withdrew this complaint at the hearing.

CA-00060959-013

The Complainant withdrew this complaint at the hearing.

CA-00060959-015

The Complainant withdrew this complaint at the hearing.

The first question to consider is whether a transfer of undertakings took place, where it is denied by the Respondent.

European Communities Protection of Employees on Transfer of Undertakings Regulations 2003, (“TUPE Regulations”) protect the rights of employees in the event that the business, or part of the business, in which they were employed is transferred to a new employer.

Regulation 3 applies:  “These Regulations shall apply to any transfer of an undertaking, business or part of an undertaking or business from one employer to another employer because of a legal transfer (including the assignment or forfeiture of a lease) or merger.”

The Labour Court, inter alia, in Department of Social Protection v Mary Dunne TUD174,  followed the jurisprudence of the European Court of Justice (“ECJ”): Spijkers v Gebroeders Benedik Abattoir CV et Alfred Benedik en Zonen BV Case 24/85, in considering the boarder questions of; did the entity retain its identity post transfer and did the operation be continued or resumed with the same or similar activities?

It was the parties’ evidence that McMullen Oil was engaged in the sale and distribution of oil, with the Complainant holding the position of delivery driver. It is noted that Mr. Kirrane accepted that the Respondent purchased McMullen Oil on “28 or 29 September 2023,” with all six employees remaining under the employment of McMullen Oil. It is accepted that the Respondent was engaged in the same or similar business activities as McMullen Oil.

Consequently, the Respondent purchased McMullen Oil on 28 or 29 September 2023. While no evidence of any purchase agreement was presented, it is accepted that the entity was purchased and that the Complainant became an employee of the Respondent. He was advised by Mr. Kirrane that he, along with another individual, was the new owner and that he reported to Mr. Hughes. It is noted that payslips remained in the name of McMullen Oil for the period he was employed. However, this is contradicted by the Respondent’s evidence that the Complainant undertook a two-week trial period with the Respondent company yet was paid through McMullen Oil.

It is noteworthy and perhaps the foundation for these disputes that there was no evidence of a consultation period between the Complainant and McMullen Oil and/or the Respondent. It is accepted that the transfer happened without the Complainant being informed at all, except for being told after the fact. It is also accepted that the Complainant took exception to the transfer immediately.

CA-00060959-001 – Unfair Dismissal

Regulation 5 (3) provides; “If a contract of employment is terminated because the transfer involves a substantial change in working conditions to the detriment of the employee concerned the employer concerned shall be regarded as having been responsible for the termination of the contract of employment.”

There was no dispute that the Complainant was offered alternative terms and conditions of employment by the Respondent in the form of a contract of employment. It is also accepted that the Complainant did undertake work for a short period under these new terms. However, it is not clear whether this was communicated as being on a trial basis or otherwise. There is no supporting documentary evidence of the discussions between the parties, which, in the circumstances of a transfer, is unsatisfactory.

There was no dispute from the Respondent that the Complainant raised concerns about two clauses in the contract of employment presented by Mr. Hughes. It was his evidence that the Complainant resigned three times with his resignation been accepted on the last occasion in November 2023. While this was not what would be considered as at the expected level of professionalism , in the circumstances where the Complainant was not consult and informed of the transfer, he raised serious concerns about his terms and conditions of employment but there is no evidence of constructive engagement from the Respondent, it is understandable.

I am particularly cognisant of Mr. Hughes’s evidence that if the Complainant wanted to work for the Respondent, he needed to sign the contract. Given that it has been determined that a transfer did take place, I find that the Respondent sought to substantially change the working conditions by requiring longer hours and introducing a pay deductions agreement, both to the detriment of the Complainant. As a result, it was reasonable for him to terminate the contract of employment.

Consequently, I find that the Complainant was unfairly dismissed by the Respondent.

CA-00060959-002 – TUPE 

Regulation 4 (1) of TUPE provides: “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.”

No evidence was presented by the Respondent of a due diligence exercise undertaken in advance of the transfer of the undertaking. However, the issue in dispute in this complaint does not appear to be the Respondent’s lack of awareness of the Complainant’s terms and conditions, as the Complainant himself was very vocal on this issue. Instead, it appears that the Complainant was instructed to accept the new terms and conditions, which have already been found to be detrimental to him in terms of working hours and pay deduction agreement.

I find that the complaint is well-founded, as the Complainant was told to either accept the new terms and conditions of employment set out in the contract presented by Mr. Hughes in November 2023 or leave his employment.

CA-00060959-004 – TUPE

For the reasons set out above I find the Respondent did not observe the terms and conditions of employment the Complainant held since 2021.

CA-00060959-006

The Complainant withdrew this complaint at the hearing.

CA-00060959-007

The Complainant withdrew this complaint at the hearing.

CA-00060959-013

The Complainant withdrew this complaint at the hearing.

CA-00060959-015

The Complainant withdrew this complaint at the hearing.

CA-00060959-001 – Unfair Dismissal

Where the Complainant was unfairly dismissed and was out of work for a period of 9 weeks before ultimately securing better paid employment, I find compensation is the most appropriate for of redress.

Section 7 ( c) (i) sets out the method of awarding compensation in a finding of unfair dismissal:-

“if the employee incurred any financial loss attributable to the dismissal, payment to him by the employer of such compensation in respect of the loss (not exceeding in amount 104 weeks remuneration in respect of the employment from which he was dismissed calculated in accordance with regulations under section 17 of this Act) as is just and equitable having regard to all the circumstances,”

Having regard to the circumstances, I order the Respondent to pay the Complainant the sum of €7,411.32 as compensation for his financial loss suffered as a result of his unfair dismissal.

CA-00060959-002 – TUPE 

I find the complaint is well founded.

Regulation 10 sets out the redress available for a breach of the legislation:-

“(5)      A decision of a rights commissioner under paragraph (4) shall do one or more of the following:

(a)     declare that the complaint is or, as the case may be, is not well founded;

(b)     require the employer to comply with these Regulations and, for that purpose, to take a specified course of action;

(c)     require the employer to pay to the employee compensation of such amount (if any) as in the opinion of the rights commissioner, is just and equitable in the circumstances, but -

(i)      in the case of a contravention of Regulation 8, not exceeding 4 weeks remuneration and,

(ii)      in the case of a contravention of any other Regulation, not exceeding 2 years remuneration,

in respect of the employee's employment calculated in accordance with Regulations made under section 17 of the Unfair Dismissals Act 1977 ,

Having regard to the circumstances, I order the Respondent to pay the Complainant the sum of €7,411.32 as compensation for his financial loss suffered as a result of the failure of the Respondent transfer the terms and conditions of the Complainant’s employment.

CA-00060959-004 – TUPE

I find the complaint is well founded.

Having regard to the circumstances, I order the Respondent to pay the Complainant the sum of €7,411.32 as compensation for his financial loss suffered as a result of failure of the Respondent observe the terms and conditions of employment.

CA-00060959-006

The Complainant withdrew this complaint at the hearing.

CA-00060959-007

The Complainant withdrew this complaint at the hearing.

CA-00060959-013

The Complainant withdrew this complaint at the hearing.

CA-00060959-015

The Complainant withdrew this complaint at the hearing.

TUPE – Unfair Dismissal