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Law and Ethics
Employment Law
By the end of this section you will be able to
- Tell the difference between an employee and an
independent contractor
- Define the tests used by the court to facilitate the
distinction
- Define unfair, constructive and wrongful dismissal
- Define redundancy and know employee’s redundancy rights
- Understand fair procedures
In groups,
discuss what
you already
know about
employment
law in Ireland.
What have you
learned in class
already about
employment law?
Will the courts
enforce an
employment
contract?
Can you be
discriminated against
because of your age?
Are any forms of
discrimination legal?
Introduction to Employment Law
Concerns law of the workplace
Governs relationship between
employees and employers.
Person who enters a contract of
employment will be an employee.
Who’s who?
Employers and employees have a
variety of rights, duties and
obligations.
Not everyone is an employee,
some are regarded as independent
contractors - the same laws do
not apply to them.
Because of this, you need to
know the differences between
them.
Distinction between employee and independent
contractor
1) Most employment law only applies to
employees eg. dismissals
2) Employer is vicariously liable for
actions of employee but not for
actions of independent contractor
3) In liquidation, employees are
treated as preferential creditors,
contractors treated as unsecured
debt.
4) Employees paid on a PAYE basis
Making distinctions
Employment legislation defines an
employee as “an individual who has
entered into work under a contract of
employment.”
Their contract is a contract OF
service.
The contract between an employer and
independant contractor is a contract
FOR services.
Common Law tests to distinguish between Emp
& IC.
1. Control Test
2. Integration Test
3. Enterprise Test
4. Economic Test
1. The ‘control’ test
The court will ask:
What level of control does employer
have over worker? The work carried
out? Methods? Can they suspend or
remove?
If yes - they are an employee.
This test got more difficult over
time.
CASES
Re: Sunday Tribune 1984
Court said test was of little value where employee exerted
special skill, increased size of business etc.
Tierney v An Post 2000
Plaintiff postmaster claimed disciplinary procedures after
sacking not followed so didn’t apply. Court looked at his
circumstances and said he was indp. contractor
2. Integration Test
Court will ask:
How integrated is worker in the business? Are they integral
to the business’s success? Eg. Sunday Tribune case
Kelly v Irish Press - columnist was considered an independent
contractor as newspaper retained full control over the final
content and held copyright
Criticisms: definitions of integration and organisation
3. Enterprise Test
Test says that worker who performs
duties as person in business in his
own right is an independent
contractor.
Q - do they bear financial risk? (See
Tierney case)
Criticisms: employees based on
commission basis for services
4. Economic Reality Test
Most modern and most likely to be
used by courts
Ready Mixed Concrete v Ministry of
Pensions 1968
- The individual works in return
for pay
- Subject to employer's control to
sufficient degree
- Contract provisions consistent
with contract of service
4. Sometimes called ‘multiple’ test
Courts recognise the need to consider
multiple factors
Henry Denny and Sons v Minister for Social
Welfare
Claimant food demonstrator considered
emploee. Paid per day irrespective of sales.
Employer gave all products and uniform.
Court said 1) had no independent input 2)
didn’t provide equipment 3) couldn’t alter
earnings.
Supreme Court said:
Irrespective of terms used by contract
drafters, it won’t prevent court from
defining status based on totality of
relationship.
Just because worker isn’t taxed on PAYE
doesn’t mean they aren’t an employee.
Minister for Agriculture and Food v Barry
Said no tests were conclusive and single
application of the test wasn’t
realistic.
Recent re-application of the “control test”
Brightwater Selection v Minister for Social and
Family Affairs
Court held Social Welfare Appeals Office erred in law
in not considering a control test.
Said it could be a contract for services, of services
or contract sui generis.
Agency Workers
Agency workers didn’t have same employment rights as workers
until EU Directive on Temp Agency Work.
2012 Act said workers must have equal treatment with regular
workers re: working time; pay; work done by pregnant women;
action taken to combat disabilities.
Temp workers must also have access to childcare facilities
etc.
Protection of Employees (Temporary Agency Work) Act 2012
2012 Act
Does not cover employees of
contracted companies or staff on work
placement schemes, Jobbridge etc.
Exam Q -
Outline any three tests used by the
courts to distinguish between a person
employed under a contract of service
and contract for services.
Termination of an Employment Contract
What are the
reasons your
contract can be
terminated?
1. Performance of the contract
2. Agreement between parties
3. Frustrating event
4. Breach of contract e.g. gross
misconduct
5. Notice
6. Dismissal
7. Redundancy
Should it be easier or harder to
terminate contract of employment?
Dismissal
Common law -
wrongful dismissal
in the courts
Statute - claim for
unfair dismissal
forums other than
courts
Unfair Dismissal
Unfair Dismissals Act 1977-2015
One of the most important aspects of employment law
Dismissal is:
a) Termination of contract of employment
b) Termination of contract because of conduct of employer
(constructive dismissal)
c) Expiration of contract for fixed term without renewal
with no objective reason for non-renewal
Eligibility to claim
Employee must be:
1) Employed by the employer under contract of service and
2) For a period of one year prior to the date of termination
(this requirement may be waived in cases of pregancy,
trade union membership, where the employee has exerted
the right to be paid minimum rate of pay or where the
employee is a whistleblower) and
3) A person is not excluded from making a claim under the
Act
People excluded from making claim under
Section 2
● Employees with less than one year’s service
● An employee under 16 or who reached retirement age
● A member of the Defence Forces or the Gardaí*
● Persons working on family farm or in home
● Persons employed at sea
● Persons on a probationary period
● Persons working illegally within the state
● Certain public servants
Where to claim
Workplace Relations Commission
(absorbed Rights Commissioners and Employment Appeals
Tribunal)
You have six months from the date of dismissal to bring case.
Extension to 12 months only available in exceptional
circumstances.
Cases demonstrating extended timeframe
Teresa Bilas v Campbell Catering
(ARAMARK) 2014
Court held that the illness of the
claimant from Dec 2011 until April
2012 was considered to be
reasonable cause
McDonagh v Dell Computer 2004
Court held plaintiff’s depression
constituted exceptional
circumstances and allowed the claim
WRC appeals go to the Labour Court
Four steps in the WRC unfair dismissal process
1. Employee must have been
dismissed
2. Proving the “reason” for
dismissal is either fair or
unfair
3. Commission assesses the
“fairness of the reason”
4. Remedies awarded
STEP 1 - Employees must have been dismissed
Commission requires employee to prove that has
been dismissed.
Words must constitute a dismissal.
Futty v Brekkes (1974)
“If you don’t like the job, f**k off.” Tribunal
held language was common on docks and did not
constitute a dismissal.
“If you are complaining about the fish
you are working on or the quality of it or
if you do not like what in fact you are
doing then you can leave your work,
clock off, and you will be paid up to the
time when you do so. Then you can
come back when you are disposed to
start work again…”
STEP 2. Proving the ‘reason’ for dismissal is fair
or unfair
Act (Section 6) provides two
categories
1)automatically unfair reasons
2)reasons that may be considered fair
Sections 6(1-2) Automatically unfair reasons
● Membership or proposed membership of a trade union
● Religious or political opinion
● Race, colour or sexual orientation of the employee
● Evidence against employer in civil or criminal
proceedings
● Age
● Membership of the Traveller community
● Pregnancy or related matters
● Exercise of right to adoptive leave, parental, force
majeure, or carers leave
● Whistleblower (Protected Disclosures Act 2014)
Fair reasons for dismissal
Capability
Capability, competence or
qualifications includes health,
physical and mental capacity.
If employee becomes incapable of
performing duties it may be fair to
dismiss.
Employer required to consider
alternatives but not obliged to
give alternative
Bolger v Showerings (1990)
Employer must show the
- Substantial reason for dismissal
was ill-health
- Employee received notice that
this was being considered
- Employee was given the
opportunity to be heard and put
forward his response
Qualifications
If employee doesn’t have qualification validly
connected to their job
Blackman v Post Office - failed to pass exam
Lister v Thom & Sons - employee needed to pass
driving test but failed - UNFAIR as didn’t affect
work
P v Mid Western Health Board - doctor whose
qualifications weren’t recognised couldn’t be
retained.
Competency
If employee lacks the competence (intellectual ability to
carry out employment.
Employee must be given notice and given support to improve.
O’Donoghue v Emerson - “off the cuff” remark insufficient
to qualify as a warning
Bell v DEVTEC - EAT found that the claimant was below the
standard required and expected, but dismissal wasn’t fair
because supervision wasn’t exercised.
Conduct of Employee
Covers wide range; fraud, bribes,
drinking on job, being late,
swearing.
Paul v East Surrey District Health
Authority 1995; nurse drank whiskey,
dismissal was fair
TMC Dairy Products v Connolly 1988 -
poor attendance = fair dismissal
Note:
Employee entitled
to fair procedures
Conduct of Employee
Gross misconduct or serious criminal
offence even after working hours can
still give rise to fair dismissal
Creffield v BBC 1975 - cameraman
conviction
Gross misconduct depends on facts
Aisha Olukoya v Veolia - luas case
Noone v Dunnes - garda assault
Conduct of Employee
Penalty must be proportionate and
reasonable
Lorraine Fitzpatrick v Dunnes Stores
(2014) -
Decision found to “lack
proportionality given the
circumstances of the case and
personal background of claimant with
12 years service.”
Conduct of Employee
If employer doesn’t have proof of
offence he must investigate and
belief must be on reasonable grounds
Pacelli v Irish Distillers Ltd 2003
Stock losses and missing products -
lack of explanation = fair dismissal
Seale v Foreman Cameras dismissal
fair after repeated warnings
Redundancy
Provided it’s a genuine
redundancy
Dundon v GPT (1995)
Employee selected because of
trade union activity was
successful claiming unfair
dismissal
Statutory Illegality
Where it becomes illegal for an
employee to continue in a position
Brennan v Blue Gas 1993
Employer dismissed employee after
truck driver could not get insurance
because of poor accident record
Four steps in the WRC unfair dismissal process
1. Employee must have been
dismissed
2. Proving the “reason” for
dismissal is either fair or
unfair
3. Commission assesses the
“fairness of the reason”
4. Remedies awarded
Duty to follow fair
procedures
Fair procedures
Constitutional duty
Employer must:
- Ensure employee aware of reasons for dismissal
- Allow representative accompany them
- Tell the employee about allegations and
provide evidence
- Give employee right to respond and make
representations
- Give employee the right to address deciding
body
Fair Procedures
Redmond v Ryanair 2006 Cabin crew
accused of falling asleep, reinstated
because denied fair procedures
Linda Magill v Tomkins Ltd/The Grand
Hotel 2014 - claimant awarded €20k,
head housekeeper dismissed without
warning/ no opportunity to defend
STEP 3 - Commission assess the ‘fairness of
reason’
If reason is not automatically unfair, the
WRC will look at evidence and decide
whether it was fair or not
Reasonableness
Would a reasonable employer have
terminated the contract of the employee?
STEP 4 - Remedies for unfair dismissal
a) Reinstatement / continuity of employment
a) Re-engagement /new contract (where
practicable)
a) Compensation - most common, max payment is
104 weeks for loss, or 4 weeks
Constructive
Dismissal
Constructive Dismissal
- Where employee terminates contract because of
conduct of the employer.
- Employer “constructs” a dismissal
- Same procedures and remedies
- Must prove conduct of the employer was serious to
entitle employee to resign
- Burden on employee to prove
Constructive Dismissal
Byrne v RHM Foods (Ireland) Ltd 1979
Employee forced to resign after new
boss didn’t give her work to do and
isolated her by cutting off phone and
removed work.
Stress = employer behaviour was
sufficiently serious and therefore
constructive dismissal
Test used by the courts
1) Contract test - would this be a fundamental
breach of contract
2) Reasonableness test
Factor Example
Changes to pay Unilateral reduction in apy
Non-payment of employee’s tax & PRSI
Changes in hours of work Change to hours and shift pattern not breach
Change from day to night shift is a breach
Changes in location If no mobility clause in contract, change to
location may amount to claim
Unjustified series of warnings Where warnings force to leave rather than
improve
Failure to investigate sexual harassment,
bullying or abuse claims
Failure to investigate sexual harassment,
bullying or abuse claims
Failure to make the workplace employee
friendly
Failing to implement smoking ban or make
reasonable adjustments for employee with
disability
Reasonableness test allows employee to
argue that employer may have acted within
terms of the contract but conduct is still
unreasonable.
e.g. “Resign or you’re fired!”
Constructive Dismissal
McKenna v Pizza Express 2007
Court awarded €63k after being
“embarrassed and humiliated” by her
employer and felt she had no option
but to resign when employer refused
to reschedule disciplinary hearings.
Court agreed this was constructive
dismissal.
Wrongful
Dismissal
Wrongful Dismissal
Common law action where contracts breached without required
notice
Remedies can include specific performance, injunctions,
damages but courts generally avoid SP.
Generally damages will be given according to what would have
been earned had notice been given.
Damages can be reduced accordingly (Carney v Balkan Tours)
Wrongful Dismissal and Minimum Notice
Minimum Notice Act 1973
Courts may oblige employer to provide an employee with
reasonable notice
Court will look at level of responsibility
Nicoll v Falcon Airways = 3 months notice for pilot
Bauman v Hulton Press = 6 months notice
Wrongful Dismissal and Minimum Notice
No notice = summary dismissal / common
law right
Generally unlawful unless employer can
provide conduct was sufficiently
serious
Wilson v Racher 1974
Gardener swearing not serious enough
Court will assess
each breach on
facts and look at
what’s
reasonable
Eligibility Criteria for Wrongful Dismissal
Common law action / happens in COURTS
Employee must prove:
- Dismissed without notice
- Consequence of breach was suffering a
loss
This is different from Unfair Dismissal because
Unfair dismissal actions go to WRC
Employee doesn’t have employed for a year like
in UD actions.
Employee can bring a claim for wrongful
dismissal 6 years after date of dismissal (UD
actions are 6 months)
Comparison table
on page 73
Factors UNFAIR CONSTRUCTIVE WRONGFUL
Definition Based on
discriminatory
grounds
Where employee
resigns because of
employer’s
behaviour
Employee
dismissed in breach
of right to notice
without just cause
Source Statute Statute Common Law
Burden of Proof Employer Employee Employee
Remedies Reinstatement, Re-
engagement,
compensation
Reinstatement, Re-
engagement,
compensation
Compensation and
injunctions only
Limits on comp 2 yrs salary with ex 2 yrs salary with ex No limit
Statute of Limit 6 mths / 12 months 6 mths / 12 mths 6 years
Factors UNFAIR CONSTRUCTIVE WRONGFUL
Minimum service
requirement
1 year with ex 1 yr with ex None
Eligibility Contracts of service Contracts of service All contracts of and
for services
Adjudication
machinery
WRC WRC Courts
Redundancy
Unfair Dismissals Acts 1977-2015 sets out
right of employer to dismiss people ‘fairly’
Redundancy Payments Acts 1967-2014
sets out the criteria for what counts as
redundancy
● Employer ceases business or location
● Requirements of business have ceased or
diminished
● Employer decides to have fewer
employees
● Employer decides that work should be
done in different manner
● Employer decides work should be done
by person capable of doing the work other
than person employed
Employee’s Rights on Redundancy
Payment: Employed for two years
Except under 16s, family employment, farms
where both employer and employee reside
Minimum notice: two weeks
Time Off: to look for new employment,
attend interviews or training
Selection for Redundancy
Employer must
- Consider alternatives
- Consult union or worker reps on avoiding redundancy
- Consult union or worker reps on selection
- Ensure selection is fair
- Ensure selection process is followed
- Offer alternative employment where possible
- Inform the employees
Mahon v McPhilips (1979)
- EAT said that employee on sick leave
at time of redundancy was not a
special reason to justify not using
last-in, first-out rule.
- Claimant had brought case on basis
that he had been dismissed while
junior employees had been retained.
Duty to consult
Collective redundancies = 10% of the workforce (20 plus)
Consultation with union 30 days prior
Employer must provide
- Reasons
- Number of employees proposed
- Period it will take effect
- Criteria for selection
- Method for calculating redundancy payment
Written notice to
the Minister
Or fine of up to
€250,000
Tobin v OCS Operations Ltd
WRC awarded €120,000 to 61
employees of Cleary’s who
were made redundant without
consultation.
Selection Criteria
Criteria must be objective and seek to ensure fairness and
consider:
- Skills and qualifications of employees
- Whether or not “last in, first out” should be used
- Attendance or disciplinary records
- Absence and time keeping records
- Experience and length of service
Must not be based on discriminatory factors
Kerrigan v Peter Owens Advertising
Claimant made redundant on the grounds of
1) Costs
2) Reorganisation
3) Age
4) Costs associated with his contract
Tribunal ruled this was not genuine redundancy
Claiming unfair dismissal in redundancy
Largely when dismissed employees
feel the consultation process of
selection process was not carried
out in accordance with the
statutory requirements
Tribunal process for redundancy
Employee will bring claim to the Commission in
same way they would an unfair dismissal claim.
It will be considered fair unless
- Redundancy isn’t genuine
- Employee was unfairly selected
- Employee was selected in contravention of
agreement
- Redundancy for any of the automatically unfair
reasons
