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We were delighted to be instructed in the case of A Presenter v A Broadcasting Company ADJ-00010297 and a copy of the decision can be accessed here.  This case look at a number of very important issues around the concept of “equal pay” within the media and entertainment industry.

In summary the complainant employee who brought the case asserted that she performed “like work” as defined under Section 7 of the Employment Equality Acts 1998 (as amended) (“the Equality Acts”) with a named male comparator whom she worked with and was therefore entitled to equal remuneration with that comparator as set out under Section 19 of the Equality Acts. The respondent company whom she was employed by, argued inter alia that that Mr. X was not an employee of the Company and that he was engaged on foot of a commercial contract negotiated between Mr. X and the Company with whom he had a relationship and therefore he was not a valid comparator.

We have set out below a summary of both the Company/employer’s case and our client’s arguments that Mr. X was a valid comparator.

Company/Employer Arguments

The Company outlined that the complainant was an employee from mid 2006 when she signed a contract of employment whilst Mr. X was never an employee but rather engaged as an independent contractor on a contract for services basis. Without prejudice to that argument, the Company also argued that the Complainant and Mr. X did not perform “like work” and that there were grounds unconnected with “gender” of the complainant and comparator (Mr. X) which rendered the rate of remuneration received by each as lawful. In essence the Company were arguing that both our client and Mr. X did not perform “like work” and in any event, any differences in pay were not related to the fact that Mr. X was male and our client was female.

Counsel for the company looked at Section 18 of the Employment Equality Acts whereby the complainant and the comparator must perform “like work” and must be “employed by the same or associated employer”. Counsel noted that the term “employed” was not defined under statute but that the terms “employee” and “employer” were.  He considered the definition of “contract of employment” further and accepted that the definition was extended by the Employment Equality Act 2004 to ensure that certain self employed persons came within the scope of the statute. He contended however, that not every contract for services was a contract of employment and referred to the case of Allonby v Accrington & Rossendale College 2004 1 CMLR 35 which held that while certain self employed persons came under the scope of the relevant Directives, truly independent contractors did not, primarily because these individuals were not in a position of subordination with the person who receives the services.

Counsel for the Company also submitted that an analysis of the relationship between it and Mr X demonstrated that it was not a relationship which fell under the scope of the employment equality legislation ad therefore Mr. X could not be used as a valid comparator as he was at all times an arms length independent contractor who was not in a relationship of subordination towards the respondent Company. He put forward a number of arguments to support this including that the contract between Mr. X and the Company was negotiated at arms length through an agent with commercially focused elements sought and negotiated and that no mutuality of obligation existed between the Company and Mr. X and there was no legal obligation on the Company to provide him with work. It also argued that there was no inequality between the bargaining powers of the parties (Company and Mr X) which is recognised as normally present in an employment relationship. It was observed that the particular relationship between media personalities and broadcasting organisations should be noted. Counsel also argued that given Mr. X’s public presence or star power and history with the Company, it was submitted that no one else could have performed that role with the same effect for the Company and therefore Mr. X was in a position of considerable commercial advantage in his negotiations with them.

Counsel for the respondent submitted a copy of the complainant’s contract of employment and the commercial agreement with Mr. X in support of his arguments and reiterated the argument that in light of the foregoing, Mr. X was not an employee of the respondent in terms of the Employment Equality Acts and was not an appropriate comparator for the purposes of her claim for equal remuneration.

Employee Arguments

Our client agreed with the Company that she was engaged or employed under a contract of employment since mid 2006 and also agreed that the media broadcast industry was of particular relevance to the issues in dispute. Our counsel however referenced a distinction between “star power” and “staying power” with the latter referencing a persons ability to stay where they are in the future. Counsel contended that a person’s history was of far less relevance that their current popularity and whilst track record was relevant as a predictor of the future, public tolerance and patience were at a premium. Counsel added that the “star quality” of our client and Mr X were the same in practical terms as both continued to be involved in the same tv programme.

The complainant stated that after she joined the Company that she was approached by commercial organisations requesting that she become involved in advertisements and campaigns. She was initially refused permission but over time she stopped looking for permission and just accepted jobs that her agent secured for her. The complainant stated that over time her role changed to the extent that she decided what she would and would not do and her decision in this regard was not challenged by the Company.

Our counsel submitted that Mr X was subject to the direction and control of the Company and that both the complainant and Mr X were subject to the direction and control from the “Head of Unit Z”. In reference to Mr X’s contract, it provided that his services were to be rendered “under the Head of Unit Z” whereas the Complainant’s contract provided that in delivering her core function was “in conjunction with and the direction and assistance of the Head of Unit Z”. Our counsel submitted that this wording was crucial and that Mr. X’s role was subject to more control and subordination of the respondent. The complainant also submitted a list of charities and events she attended which was also indicative of her “star power”.

Counsel also looked at the characteristics argued by the respondent in support of the assertion that Mr. X was an independent contractor and made a number of observations in respect of these including that commercial negotiation was irrelevant to the test as was the existence of a business name and that the arguments advanced on the non existence of mutuality of obligation was misstated insofar as no evidence was adduced that Mr. X had a right to refuse work within the terms of the arrangement between him and the company.

Counsel also argued that the definition of “contract of employment” contained in the Employment Equality Act 1998 was extended by the 2004 Act and was clearly designed to ensure that self employed persons who provide services came within the scope of the Equality legislation. He also noted that the Workplace Relations Commission and the Labour Court have confirmed broad application of the definition of “employee” in Section 2 of the Employment Equality Acts which encompasses self employed contractors and cited a number of cases including Killaly v ESB Networks DEC-E1012-183 and Wall v Nowacki EDA 198. Counsel also drew the Adjudicator’s attention to the definition of “employee” in the UK Employment Rights Act 1996 and additional caselaw.

Findings and Conclusions

The Adjudicator observed “It is well established that a person who claims an entitlement to equal remuneration under Section 19 of the Employment Equality Acts 1998-2015 must demonstrate, in the first instance that s/he performs “like work” in terms of Section 7 of those Acts, with a comparator of the opposite sex, who is an employee of the same or associated employer”. He also noted the definition of an employee, employer and contract of employment.

The Adjudicator noted that the complainant employee selected Mr. X as her comparator and that the company argued this could not be done as Mr. X was not an employee of the Company but rather an independent contractor. The Adjudicator stated that as “this issue goes to the core of the complainant’s locus standi to maintain her claim, I have decided to investigate this matter as a preliminary matter in accordance with section 79(3A) of the Employment Equality Acts 1998-2015”.

The Adjudicator commenced by looking at the expanded definition of “contract of employment” contained in legislation in that “it expressly provided that a person engaged under a contract for services may be an employee for the purposes of the Acts”.  Having reviewed the contractual arrangements between the parties, the Adjudicator observed that “..I am therefore satisfied that Mr.X was engaged by the respondent on a contract for services and was, on the face of it, an independent contractor. However, as counsel for the complainant quite correctly points out, the issue in the instant case is not where Mr. X is an independent contractor engaged under a contract for services, rather the question is whether the Agreement is such that it is encompassed by the definition of “contract of employment” provided at section 2(1)(b)(ii) of the Employment  Equality Acts”.

The Adjudicator looked at several cases in reviewing this including Henry Denny v Minister for Social Welfare, (1998) 1 IR 34, Castleisland Cattle Breeding Society Ltd v Minister for Social and Family Affairs (2204) 4 IR 50, Brightwater Selection (Ireland) Ltd v Minister for Social & Family Affairs (2011) IEHC 510, Re Sunday Tribune Ltd [1984] IR 505, Bates von Winkehof v Clyde & Co LLP and another (2014) IRLR 641.

The Adjudicator observed that both parties referenced the case of Allonby v Accrington & Rossendale College [2004] 1 CMLR 35 which provided at paragraph 71 “the formal classification of a self employed person under national law does not exclude the possibility that a person must be classified as a worker within the meaning of Article 141(1) EC if his independence is not merely notional, thereby distinguishing an employment relationship within the meaning of that article”. The Adjudicator observed “This clearly indicates that regardless of how a contractual relationship is labelled, it is necessary when evaluating that relationship to assess it to ensure the person is actually independent in the discharge of his/her functions and that the independence is not merely notional”.

The Adjudicator found that (in light of the above comments) inter alia that “(a) Mr. X is engaged by the respondent on a contract for services (b) The respondent exercised a significant degree of control over Mr. X in the delivery of these services. In particular the time and location where the services are delivered (c) Crucially Mr. X must provide the services he is engaged to deliver himself. He cannot decide to reassign the services to any person of his choosing and referenced a number of other factors such as the services being provided by Mr. X as integral to the respondent’s business and that “on balance” and in reference to the Allonby case, that “…he operates in a position of subordination in terms of the respondent”.

The Adjudicator also observed in reference to the requirement under paragraph 66 of the Allonby decision, that the term “worker” is not interpreted in a restrictive manner.

“I am satisfied that this requirement applies whether it is being applied to a complainant or a comparator for the purposes of a claim for equal remuneration under the Employment Equality Acts 1998 -2015. The definition of “contract of employment” at section 2(1)(b)(i) of the Employment Equality Acts 1998-2015 is an expansive one, an expressly covers a person engaged on a contract for services. The principle of equal remuneration has been a fundamental concept of community law from the outset and has been a cornerstone in the overall progress of the right of men and women at work and in employment. I therefore find, on balance that Mr. X is an employee of the respondent………………”.

Summary

(a) the contractual arrangement between the respondent company and Mr. X is a contract of employment.

(b) Mr X is an employee of the respondent in terms of the Employment Equality Acts 1998 (as amended)

(c) Mr. X is therefore a valid comparator for the purposes of the complainant’s claim of equal remuneration in accordance with Section 7 and 19 of the Employment Equality Acts 1998 (as amended).

This case is very important for employers as it demonstrates that the contractual documentation in place does not always reflect the reality of the relationship. The concept of equal pay is also extremely important and employers must ensure that when parties employed/engaged by them are performing “like work” that they are either paid the same or that there is an objective justification for the different rates of pay.

If you have any queries on this blog post please don’t be afraid to reach out and call us on +353 1 517 5900 or email us at wendy@wdsolicitors.ie.