Contracts of indefinite duration*

By November 24, 2021Employment Law

Contracts of indefinite duration*

This issue arose in the case of Marley and Entry Point North Ireland Designated Activity Company Entry Point North Ireland ADJ-00031647.

The Adjudication Officer in this case set out the Labour Court decision in Irish Museum of Modern Art -v- Stanley FTD146 2014 where it was stated that;

“The defining characteristic of fixed term contract or fixed term employment is that it is determined by an objective condition which is identifiable without reference to the view or perception or intervention of either party to the contract”

The Adjudication Officer also pointed out that they noted the case of Adeneler and Others -v- Ellinikos Organismos Galaktos 2006 IRL716 where the statement that;

“the concept of objective reasons…must be understood as referring to precise and concrete circumstances characterising a given activity, which are therefore capable of that particular context of justifying the use of successive fixed term employment contracts”

The Adjudication Officer in this case held that there was no clearly defined objective grounds.

The Adjudication Officer pointed out that when determining whether the renewal of a fixed term contact comes within the scope of Section 9 (4) of the Act it is necessary to consider whether it has a purpose of achieving a legitimate objective of the employer.

The Adjudication Officer quoted the Labour Court case of Namara -v- Teagasc FTD138 where it was stated that;

“There are many forms of economic activity in which the viability of employment is dependent on funding generated by individual contracts or projects. This is the case in practically all employment providing professional services and in such industries as construction and civil engineering. That type of activity is dependent on a continuing supply of separate once off’s contracts or projects in order to maintain employment. If it were to be held that the use and success of fixed term contracts can be used indefinitely in such employments so as to protect the employer against the possibility of an insufficient supply of work at some point in the future the effectiveness of the directive and the act would be seriously subverted. It, due to economic circumstances or fall offs in demand, there is no longer sufficient work in order to maintain a worker in employment the employer’s remedy lies in making surplus staff redundant. It follows that while the requirement to balance staff levels with available funding is a legitimate objective the continual use of fixed term contracts is not always a proportionate and necessary means of achieving that object”

The Adjudication Officer held that while they were aware that the respondent was in dire financial situations common to any business operating the airline industry the Adjudication Officer found in line with the Labour Court decision that the use of fixed term contracts was not necessary means of achieving that objective. In that case an award of €15,000 was made.

*Before acting or refraining from acting on anything in this guide, legal advice should be sought from a solicitor.

*In contentious cases a solicitor may not charge fees or expenses as a proportion or percentage of any award or settlement.

Richard Grogan

Author Richard Grogan

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