Status misclassification: WRC applies Irish Supreme Court guidance to RTÉ case

In a significant preliminary ruling, the Workplace Relations Commission has found that a complainant was misclassified as a freelancer by RTÉ, when the reality of her working relationship reflected that of an employee.

The Workplace Relations Commission (WRC) has made a preliminary ruling that the complainant, Ms Bata Bajgart, was misclassified as a freelancer by the respondent, Radio Telefís na hÉireann (RTÉ), when the reality of the relationship was one of employer and employee. The complainant submitted claims to the WRC arguing that she was entitled to  as she was their employee and not a contractor, which RTÉ refutes.

This preliminary hearing followed the principles set out in the landmark case, The Revenue Commissioners v Karshan Midlands t/a Domino's Pizza (Karshan) to assess the distinction between employees and contractors. The principles established by the Karshan case are known as the "five-step test" as detailed below.

Background

The complainant was first engaged by RTÉ as an on-set photographer for the network's soap opera "Fair City" in 2011. She was appointed as an independent contractor with a fixed term agreement for one year and paid €750 per week, with a repeatedly renewed contract. The complainant acknowledged that there was no contract in place between October 2018 and January 2019. However, she stated that she continued to work during this period and was paid as normal by RTÉ.

In September 2023, RTÉ's finances came under scrutiny by the Oireachtas Committee on Public Accounts. As part of these discussions, the complainant received some negative commentary regarding her skills and pay rate. In November 2023, the complainant's solicitor wrote to the RTÉ claiming that she was an employee "to whom a contract of indefinite duration has long since accrued". However, RTÉ refuted this position, responding that the contract in place was "not an employment relationship but one of a supplier of services".

The complainant continued to work with RTÉ until 15 December 2023 when her contract was terminated without notice. RTÉ re-advertised the contract as part of a new tender process. The complainant did not apply for this position.

Analysis of the complainant's employment status under the Karshan test

The adjudication officer (AO) considered the five steps of the framework established by Mr Justice Murray in the Karshan case which are set out in our previous case briefing. The complainant claimed that she could satisfy the five steps and provided evidence to support her position. This included:

1. Contract in exchange of wage or other remuneration for work: The complainant was engaged under a contract under which RTÉ agreed to provide her with 20 hours of work each week for 50 weeks of the year. In her final contract, the complainant agreed to do this work at a rate of €980 per week. Both parties agreed that this limb of the test was satisfied.

2. Personal service: RTÉ claimed that the complainant did not meet this limb of the test based on the requirement for her to provide a substitute if she was not available for work. RTÉ pointed to the invitation to tender under which the complainant was required to provide the names of other photographers who could substitute for her if she was absent. The complainant stated that since 2011, she did the work personally for 47 out of the 50 weeks and that she only provided a substitute if she was on holidays or if her or her children were sick. The AO was satisfied that the complainant satisfied this limb of the test.

3. Control: The complainant stated that each week, RTÉ provided her with a schedule of photographs that she was to take the following week. This meant that the complainant was required to attend the set at specific times and places. She did not have any discretion in this regard. She presented the photographs to a project manager who supervised her work and told the complainant when they were to be uploaded and made available. The AO was satisfied that RTÉ exercised a sufficient level of control over the complainant's work.

4. Terms of the contract and factual matrix: As the AO was satisfied that the complainant met the first three limbs of the "threshold test" set out in the Karshan case, she proceeded to consider whether the terms of the contract in place between the parties were consistent with a contract of employment. Upon review of the evidence referred to by both parties, the AO was satisfied that the complainant's day-to-day reality was not consistent with what was described in her contract as a supplier. Rather, her day-to-day was more akin to that of an employee. Examples which supported such position included the complainant's working hours. She was required to work for RTÉ for 20 hours a week, had no discretion about her level of attendance on the set and even had a desk on set. The AO further stated that the authors of the contract may have genuinely believed that the working relationship was that of an independent contractor, but "the sustained nature of her job and the sole reliance by the respondent [RTÉ] on the complainant to do the work, meant that the legal basis of the agreement had evolved from a supplier's agreement to that of an employee".

5. The AO held that the fifth question, whether there is anything in the legislative regime that requires a particular approach to be taken, was not relevant to the case.

Having considered the above and satisfying each limb of the Karshan test, the AO ruled that the complainant was an employee of RTÉ and not an independent contractor. The matter will now proceed to a full hearing.

Conclusion

This decision highlights the challenges in defining the true nature of working relationships. The Workplace Relations Commission (WRC) is continuing to demonstrate a willingness to look beyond the terms of a written agreement and place emphasis on the practical reality of the relationship between the parties. This is certainly a case to watch, as organisations considering or already engaged in agreements with independent contractors may need to review the relationship and terms of work in light of the five steps above.

How Ogier can help

For further assistance on classifying workers as independent contractors or employees, or for assistance with preparing contracts of employment and/or independent contractor's agreements, please contact a member of our Employment team below.

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Disclaimer

This client briefing has been prepared for clients and professional associates of Ogier. The information and expressions of opinion which it contains are not intended to be a comprehensive study or to provide legal advice and should not be treated as a substitute for specific advice concerning individual situations.

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