Industrial Tribunals Northern Ireland Decisions

THE INDUSTRIAL TRIBUNALS

CASE REF: 336/06IT

APPELLANT: P Clarke & Sons Limited

RESPONDENT: Construction Industry Training Board

DECISION

The unanimous decision of the tribunal is that the appeal should be upheld and that P Clarke and Sons Limited is not liable to pay a levy to the Construction Industry Training Board, in relation to any activity relevant to the hybrid employees which is not carried out in Northern Ireland.

Constitution of Tribunal:

Chairman: S A Crothers

Panel Members: Mr McCusker

Mr Hall

Appearances:

The Appellant was represented by Mr M Reel, Barrister at Law instructed by Morgan McManus Solicitors.

The respondent was represented by Mr J Coyle, Barrister at Law instructed by Babington & Croasdaile Solicitors.

1. The Tribunal received a bundle of documents from the respondent which included extracts from the relevant legislation and a number of Industrial Tribunal decisions. The Tribunal also heard evidence from the appellant's Financial Director, Deirdre Somerville.
2. The Tribunal was assisted by detailed written submissions furnished by both parties. These submissions contain extensive extracts from the relevant legislation and case law. The Tribunal does not intend to reproduce the provisions of the legislation in detail as the submissions from both parties are appended to this decision.
3. The net issue for the Tribunal, as agreed between the parties, was as to whether administrative and support members of staff based at the appellant's premises in Lisnaskea, Co. Fermanagh and who gave administrative assistance and support to operations carried out by the appellant company in both Northern Ireland and the Republic of Ireland, or the Republic of Ireland exclusively, (hereinafter referred to as "The Hybrid employees") should have their relevant earnings taken into account by the respondent for the purposes of imposing a levy in accordance with the legislation governing the levy periods 38, 39, 40, spanning the period from 31/8/02 to the 31/8/05 inclusive.
4. Having analysed the evidence before it in so far as same relates to the foregoing issue, the Tribunal came to the following findings of fact.

(i) The appellant company carried out the vast majority of its work in the Republic of Ireland. The Tribunal was shown a letter from Deirdre Somerville dated 18/6/01 to the respondent which records as follows: - "Further to our meeting I wish to confirm that 85% of our payroll would relate to Southern employees and that 90% of our domestic subcontractors are registered with Southern tax authorities". The Tribunal accepts Miss Somerville's evidence that the position had changed little in the subsequent years and, if anything, the appellant company appears to have increased its work in the Republic of Ireland since 2001.

(ii) The Tribunal also accepts Deirdre Somerville's evidence in relation to examples of a number of employees within the administrative and support section based at Lisnaskea who divided their time between Northern Ireland and Republic of Ireland operations or whose work consisted entirely of supporting operations within the Republic of Ireland. The Tribunal also accepted her evidence concerning separate bodies within the Republic of Ireland dealing with training needs within the construction industry there.

(iii) It was common case that an employee such as Jacinta Cox who lived and worked in Dublin and whose total function and job in marketing in the Greater Dublin area could not be considered as relevant in the context of the present case.

5. The law in relation to the issue is adequately set out in the submissions appended to this decision.
6. The Tribunal, having analysed the evidence before it in relation to the foregoing issue and having considered carefully the submissions by both parties concludes as follows:-

(i) Schedule 1 to the Industrial Training (Construction Board) Order (Northern Ireland) 1964 states as follows:-

"1. Subject to the provisions of this Schedule, the activities of the construction industry are the following activities in so far as they are carried out in Northern Ireland:- ……

(g) when carried out in association with or in conjunction with any of the foregoing activities, any of the following activities that is to say:-

(i) research, development, design or drawing;

(ii) operations in connection with sale, packing, warehousing, distribution or transport;

(iii) work done at any office or laboratory, at any store, warehouse, or similar place or at a garage;

(h) any other activity of industry or commerce carried out at or from an establishment engaged mainly in one or more foregoing activities".

The respondent's case was, inter alia, that sub paragraph (g) was an activity of the construction industry in Northern Ireland in itself, sufficient to ensure that the levy was imposed on the first category of hybrid employees, and that sub paragraph (h) was sufficient to embrace the second category, also referred to at paragraph 3 above. The appellants case laid considerable emphasis on the wording of sub paragraph (g) and in particular the following words: "When carried out in association with or in conjunction with any of the foregoing activities, any of the forgoing activities, that is to say:-" It was common case that support and administrative staff fell in general terms within the scope of sub paragraph (g). After careful consideration the Tribunal finds itself persuaded by the appellant's argument. In order for the support and administrative function to be activities within sub paragraph (g) they must be carried out with or in conjunction with the activities specified at 1. (a) - (f). These activities at (a) - (f) are in turn qualified by the opening words of the Schedule which refer to the "activities of the Construction Industry or the following activities in so far as they are carried out in Northern Ireland". The Tribunal therefore concludes that any activity relevant to the hybrid employees which is not carried out in Northern Ireland is not subject to a levy imposition, and accordingly their earnings should not be taking into account for the levy periods stated at paragraph 3 above. It is therefore unnecessary to consider the second category of hybrid employees or the significance of sub paragraph (h) of the said Schedule 1. The appeal is therefore upheld.

Chairman:

Date and place of hearing: 9 August 2006, Belfast.

Date decision recorded in register and issued to parties: