The Complainant appealed the decision of the Adjudication Officer to the Labour Court which found that he had not been unfairly dismissed by Speed King Couriers Limited T/A Fastway Couriers Midlands (the Respondent).

The matter at issue in this appeal was whether the Complainant, tasked with delivering parcels to the Respondent’s customers, was working under a contract of service or a contract for services.

It was submitted on behalf of the Respondent that the Complainant was at all material times an Independent Contractor, engaged under a contract for services.  The burden of establishing that the Complainant was engaged pursuant to a contract of service – and therefore having proper position to maintain the within proceedings rested with the Complainant.

The Complainant commenced driving as a delivery courier for the Respondent in late October 2017. He invoiced the Respondent weekly in arrears at the rate of €190.00 plus VAT per day. The Complainant was provided with a scanning device (and trained in its use) by the Respondent.  He was required to wear a company-supplied uniform and to display an A4 sized company logo on the front screen of his vehicle.   The Complainant informed the court that he worked exclusively for the Respondent.  His evidence was that it would have been completely impractical for him to consider taking on additional work elsewhere having regard to the time of the day that he normally finished his delivery round for the Respondent. Also, he would have had to change out of his uniform and remove the sign with the Respondent’s logo from his van were he to undertake work elsewhere.

On or around the 15th of February 2019, the Complainant was out in his van making deliveries when he received a telephone call from the Respondent inviting him to return to their depot. The Complainant declined as it was located at a considerable distance from where he was at that time and asked the Respondent what the purpose of the proposed meeting at the depot was. The Respondent informed him that he was to be let go as there was no more work for him.  The Complainant was offered an alternative route but that was sold, and the Complainant was his contract was terminated.

The Complainant outlined that his losses were in the region of €20,000 for 2019 but did not furnish the Court with any paperwork to substantiate his claimed loss, nor did he produce any documentary evidence of his efforts to mitigate his loss.

The Respondent’s representative outlined the business model in which the Complainant was engaged which is based on selling franchises to individuals in respect of designated areas, however, the Respondent also engages Interim Couriers on a self-employed basis pending the sale of a franchise.  The Respondent disputed the Complainant’s assertions that he was not free to provide services other than to the Respondent and not free to substitute another driver on occasion.

The Court considered the ‘mixed test’ or reality test as considered by the Supreme Court in Henry Denny & Sons v The Minister for Social Welfare [1997] and found that the Complainant was subject to considerable control by the Respondent in the manner in which he performed his work.  The Complainant was required to give personal service in so far as he could not sub-contract the work. Finally, the work done by the Complainant was part and parcel of the Respondent’s core business. He was, therefore, an integral part of that business.

The Court concluded that the Complainant was in reality, and notwithstanding appearances to the contrary, engaged at all material times by the Respondent under a contract of service.  The Court emphasised that while it should have regard to the terms of any written agreement in place between parties to an employment arrangement, the terms of such an agreement cannot be regarded as determinative of the true nature of their relationship.

The Court also concluded that the Complainant’s dismissal was an unfair dismissal. However, the court found that the Complainant’s evidence in relation to loss and mitigation deeply unsatisfactory.   No documentary evidence was produced to the Court that demonstrated that the Complainant made the necessary efforts to obtain alternative employment as mandated by the Act. Therefore, the Labour Court awarded the Complainant the sum of €3,800.00 compensation, representing four weeks pay.

Guidance for Employers

When considering if an Employee is working under a contract of service or whether they are working under a contract for services, the court will have regard to the following factors 1) The level of control exercised over the employee by the Employer 2) the written agreement (if any) that was signed by both parties, 3) the work done by the employee, i.e if the work undertaken by the employee is part and parcel of the Employer's core business. 
https://www.workplacerelations.ie/en/cases/2022/february/udd225.html