Complainant

Respondent

Parties

Nicola Power

Road Safety Authority

Representatives

self

Robin McKenna IBEC

Act

Complaint Reference No.

Date of Receipt

Complaint seeking adjudication by the Workplace Relations Commission under Section 39 of the Redundancy Payments Act, 1967

CA-00063967-001

06/06/2024

The Complainant commenced her employment with the RSA on 12 April 2021 as a Driver Tester on a fixed term contract, ending 12 February 2023. This contract was extended to 9 February 2024, at which time her employment ended.

In 2020, the Department of Transport gave verbal authorisation for the RSA to recruit forty temporary driver testers. This sanction was confirmed in writing on 22 June 2021. These temporary driver testers were recruited to “…deal with backlogs arising from covid and the closure of services come up and the reduced capacity and services were permitted to resume”

As a result of an open competition, the Complainant commenced employment with the RSA on 12 April 2021 on a fixed term contract. As a new employee of the RSA, the Complainant initially undertook an intensive eight-week training programme, for which she was successful.

Following approval from the Department of Transport on 5 July 2022 for the RSA to recruit thirty permanent driver testers, the Complainant applied for one of these vacancies. However, on that occasion she did not pass the high standard tester course.

On 16 January 2023, the Complainant was offered an extension to her fixed term contract, for the purpose of: “Your fixed-term contract is to be renewed as a result of the continuing impact of service disruptions from recent restrictions on service delivery and capacity which RSA is actively managing. In addition to this, an 3 increased and as yet unmet demand from a higher number of learner drivers has further compounded the backlog of tests.” The Complainant responded on the same date, accepting the contract extension to 9 February 2024.

On 29 March 2023, the RSA was sanctioned to recruit an additional 75 driver testers on fixed term contracts. This was brought to the attention of all driver testers on fixed term contracts, including the Complainant. While some of the Complainant’s colleagues on fixed term contracts applied for, and were successful, in their applications and remain in the employment of the RSA until January 2025, the Complainant chose not to make an application.

By letter dated 6 December 2023, the Complainant was notified that her fixed term contract was ending on 9 February 2024, as stated in her contract extension of January 2023.

The Complainant submitted her complaint to the WRC on 6 June 2024.

The Complainant has stated that based on her service and the termination of her employment she is entitled to a statutory redundancy payment.

The RSA would argue that this is not a redundancy situation. Section 7(2) of the Redundancy Payments Act 1967 states:

“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

(b) the fact that the requirements of that business for employees to carry out work of a particular kind in the place where he was so employed have ceased or diminished or are expected to cease or diminish, or

(c) the fact that his employer has decided to carry on the business with fewer or no employees, whether by requiring the work for which the employee had been employed (or had been doing before his dismissal) to be done by other employees or otherwise, or

(d) the fact that his employer has decided that the work for which the employee had been employed (or had been doing before his dismissal) should henceforward be done in a different manner for which the employee is not sufficiently qualified or trained, or

(e) the fact that his employer has decided that the work for which the employee had been employed (or had been doing before his dismissal) should henceforward be done by a person who is also capable of doing other work for which the employee is not sufficiently qualified or trained”

Permanent driver tester roles were filled while Ms Power was on her initial fixed term contract, for which she was unsuccessful. Another opportunity, which would have seen her employed by the RSA until January 2025, was ignored by Ms Power when she chose not to apply.

 The Authority would argue that none of the conditions as outlined in Section 7 of the Act apply in this current situation and Ms Power is not entitled to a redundancy payment.

The Complainant was on a fixed purpose contract and there are circumstances where a fixed term employee when compared to a permanent employee would be entitled to a redundancy payment.

The right of fixed term employees to redundancy was comprehensively considered in University College Cork and DR. Naomi Bushin Neutral Citation [2012] IEHC 76:

DECISION

I am satisfied, contrary to the submissions of the appellant, that the Labour Court did consider s. 5 (1)(a) and its possible application to the respondent in relation to several categories of permanent employees. Those considered included staff and employees of St. Catherine's College of Education for Home Economics, employees of the Royal College of Surgeons, catering staff in the National University of Ireland in Maynooth and an employee in Wexford VEC.

The Labour Court decided that none of these employees fell within the category described at s. 5(1)(a) before proceeding to consider whether an appropriate comparator existed for the purposes of section 5(1)(b).

Having conducted that secondary exercise, the Labour Court then moved on to consider section 5(1)(c).

Given that no permanent employees employed by the appellant have been made redundant, I cannot see how any such permanent employee would be an appropriate comparator, either for the purposes of the statute or for the purposes of Council Directive 1999/70/EC of 28th June 1999 concerning the Framework Agreement on Fixed Term Work concluded by ETUC, UNICE and CEEP. Clause 1 of the Framework Agreement describes the purpose of the Directive as being, inter alia, to improve the quality of fixed term work by ensuring the application of the principle of non discrimination and to establish a framework to prevent abuse arising from the use of successive fixed term employment contracts or relationships.

While the appellant did contend that the Labour Court had failed to properly consider s. 5 (1)(a) I am satisfied that this submission is based on an incorrect premise. There is an inherent artificiality in arguing that no issue of discrimination can arise because no permanent employees employed by the appellant have been made redundant. It seems clear to me that to classify such permanent employees as appropriate comparators would, contrary to the purposes of the Directive, foster discrimination by encouraging employers to select fixed term employees for redundancy ahead of permanent employees, thereby avoiding the creation of any form of precedent of enhanced redundancy payments against which fixed term employees could measure their own payments.

I am also satisfied that the Labour Court was correct in law in finding that an ex gratia redundancy payment represented a "condition of employment" within the meaning of the Act. In so finding, the Labour Court relied upon the decision of the European Court of Justice in case C 262/88 Barber v. Royal Exchange [1990] ICR 616, in which the ECJ stated at para 16:-

"A redundancy payment made by the employer, such as that which is at issue, cannot cease to constitute a form of pay on the sole ground that, rather than deriving from the contract of employment, it is a statutory or ex gratia payment."

A similar view was taken in the High Court (Smyth J.) in Sunday Newspapers Ltd. v. Kinsella [2007] JEHC 324 at 18.

I am further satisfied that the two decisions cited by the appellant in relation to "conditions of employment' namely, 0' Cearbhaill v. Bord Telecom Eireann [1994] ELR 54 and Rafferty v. National Bus and Rail Union [1997] 2IR 424 can be distinguished on the basis that both decisions have been superseded by the Act of 2003.

In relation to the submissions made by the appellant in relation to s. 7, I am satisfied that in view of my conclusion that the Labour Court did not err in law in finding that the respondent was treated less favourably than appropriate comparators, it was correct to consider the issue of objective justification under section 7.

The respondent was denied an ex gratia payment on the basis she was a fixed term employee. Ex gratia payments were made to valid comparators. There was thus no possibility of her receiving some different, but no less favourable treatment. The contention advanced by the appellants is predicated entirely on the status of the respondent as the fixed term employee and as such is, in my view, precluded by s. 7(1) of the Act.

The Protection of Employees (Fixed-Term Work) Act 2003 states:

Comparable permanent employee.

5.—(1) For the purposes of this Part, an employee is a comparable permanent employee in relation to a fixed-term employee if—

(a) the permanent employee and the relevant fixed-term employee are employed by the same employer or associated employers and one of the conditions referred to in subsection (2) is satisfied in respect of those employees,

(b) in case paragraph (a) does not apply (including a case where the relevant fixed-term employee is the sole employee of the employer), the permanent employee is specified in a collective agreement, being an agreement that for the time being has effect in relation to the relevant fixed-term employee, to be a type of employee who is to be regarded for the purposes of this Part as a comparable permanent employee in relation to the relevant fixed-term employee, or

(c) in case neither paragraph (a) nor (b) applies, the employee is employed in the same industry or sector of employment as the relevant fixed-term employee and one of the conditions referred to in subsection (2) is satisfied in respect of those employees, and references in this Part to a comparable permanent employee in relation to a fixed-term employee shall be read accordingly.

(2) The following are the conditions mentioned in subsection (1)—

(a) both of the employees concerned perform the same work under the same or similar conditions or each is interchangeable with the other in relation to the work,

(b) the work performed by one of the employees concerned is of the same or a similar nature to that performed by the other and any differences between the work performed or the conditions under which it is performed by each, either are of small importance in relation to the work as a whole or occur with such irregularity as not to be significant, and

(c) the work performed by the relevant fixed-term employee is equal or greater in value to the work performed by the other employee concerned, having regard to such matters as skill, physical or mental requirements, responsibility and working conditions.

The Act provides very significant protection to Fixed Term employees.

The Complainant applied for a permanent role in July 2022 as the permanent establishment manpower increased. This means that the initial objective justification for additional staff on fixed term contracts to clear a backlog had changed. The Complainant applied for such a role and was not successful based on an assessment. Her employment didn’t cease and continued; however, on a fixed term contract. It is assumed that this was objectively justified based on a backlog still existing. Another opportunity for another fixed term contract arose in Marh 2023 and it is probable she would have obtained that contract. She didn’t apply and her contract ended based on her choice and the end of the fixed term.

The conditions set down in the Act to determine whether a redundancy or not exists have not been met. There is no reduction in the workforce. It is possible that at a point in the contract if a dismissal had arisen when she was unsuccessful arising from not passing the high standard tester course, a redundancy could be argued for based on the following:

(d) the fact that his employer has decided that the work for which the employee had been employed (or had been doing before his dismissal) should henceforward be done in a different manner for which the employee is not sufficiently qualified or trained, or

(e) the fact that his employer has decided that the work for which the employee had been employed (or had been doing before his dismissal) should henceforward be done by a person who is also capable of doing other work for which the employee is not sufficiently qualified or trained”

A fixed term contract is not a mechanism to provide maximum flexibility to an employer so that a contract can be ended so to avoid liability under several employment rights acts.

In University College Cork and DR. Naomi  FTC/10/42, the Labour Court concluded that fixed a term worker could not be treated differently to a permanent employee based on her employment status and any difference in treatment must be objectively justified:

Objective grounds justifying less favourable treatment

It is accepted that the comparators received a payment equal to four weeks pay per year of service plus their statutory entitlements on being made redundant. There is no dispute that the Complainant was engaged in work of equal to or greater value than the comparators within the meaning of Section 5(2)(c) of the Act. It follows that the Complainant is entitled to be treated similarly, on being made redundant, unless the difference in treatment can be objectively justified.

The test for determining if a ground relied upon is sufficient to justify treating a fixed-term employee differently than a comparable permanent employee is contained in Section 7 of the Act. The elements of this test are that factors relied upon as constituting an objectively justifiable ground must (a) be for the purpose of achieving a legitimate aim of the employer, (b) the unequal treatment must be an appropriate means of achieving the legitimate aim identified and (c) it must be necessary for its achievement.

The Respondent submitted that that the difference in treatment between the Complainant and the comparators was objectively justified. Mr. Given submitted that the Complainant was not paid an ex-gratia redundancy payment because it took the view that ex-gratia redundancy payments were not a condition of employment within the meaning of Section 6 of the Act; her contract had expired by effluxion of time and there was a fundamental distinction between a fixed-term worker and a permanent employee faced with a loss of permanent employment due to the absence of any expectation of permanence on the part of the fixed-term employee.

Section 7(i) of the Act precludes reliance on the status of the employee as a fixed-term worker as providing objective grounds for less favourable treatment. The Court is of the view that the only grounds submitted by the Respondent for the difference in treatment between permanent employees and the Complainant relate solely to her employment status as a fixed-term employee, hence the Court cannot accepts that it constitutes objective grounds justifying less favourable treatment within the meaning of Section 7 of the Act.

In light of it’s finding the Court must consider if it is appropriate to make an award of compensation pursuant to Section 14(1)(d) of the Act. The Court is satisfied that there were complexities in this case which needed to be addressed, as the situation was not clearly defined. Furthermore, the Court is satisfied that the Respondent did not set out to delay or be tardy with the process. In such circumstances the Court is not satisfied thatVon Colson & Kamann V Land Nordrhein - Westfalen [1984] ECR 1891applies.

Determination

The Court determines that the complaint herein is well-founded.

The Court directs that the Respondent to pay the Complainant an ex-gratia redundancy payment calculated on the basis of four weeks' pay per year of service, plus statutory redundancy entitlement.

The Decision of the Rights Commissioner is varied in accordance with the terms of this Determination.

The Complainant commenced her employment with the RSA on 12 April 2021 as a Driver Tester on a fixed term contract, ending 12 February 2023. This contract was extended to 9 February 2024, at which time her employment ended. The contract existed to clear a backlog. The contract ended arising from the fixed term condition. On these facts a redundancy claim is not well founded.

While the contract did end, and she was dismissed arising from the fixed term nature of her contract; her employment on the balance of probabilities would have continued if she had applied for the fixed term contract. In these circumstances by personal choice the contract had come to an end.

The Complainant has not made out a case of less favourable treatment when compared to a permanent employee.

On the facts the employment did not cease arising from redundancy and in fact ended because of the fixed term of her contract. In those circumstances I must find against the Complainant, and I determine that her appeal fails, and that the complaint is not well founded.

The Complainant commenced her employment with the RSA on 12 April 2021 as a Driver Tester on a fixed term contract, ending 12 February 2023. This contract was extended to 9 February 2024, at which time her employment ended. The contract existed to clear a backlog. The contract ended arising from the fixed term condition. On these facts a redundancy claim is not well founded.

The Complainant has not made out a case of less favourable treatment when compared to a permanent employee.

On the facts the employment did not cease arising from redundancy and in fact ended because of the fixed term of her contract which was objectively justified to clear a backlog. In these circumstances I must find against the Complainant, and I determine that her appeal fails, and that the complaint is not well founded.

Fixed Term Contract-Redundancy-No Comparator