GDPR Data Protection Legal Actions in Ireland-the Essentials

gdpr legal actions

 

Were you worried in the lead up to GDPR?

Has the danger passed? Are you just keeping the head down and hoping for the best?

Are you in a good place with respect to compliance or do you still have some concerns but hope the fears generated were exaggerated?

Just to remind you new regulations concerning personal data protection came into force in the EU from 25th May, 2015: the GDPR regulations.

What has happened since then? Was the fear and loathing justified? Was it another “Y2K” scare-all hat and no cattle-or is it too early to decide?

Firstly, GDPR came into effect in Ireland 24 hours after the commencement of a new data protection act, the Data Protection Act, 2018. There is a certain degree of trepidation amongst data controllers and processors that this new law will lead to a significant increase in the number of legal cases arising as a result of breaches for the law now allows data subjects bring civil actions for compensation.

Collective Actions

Data subjects can also now authorise not for profit organisations to bring complaints and act on their behalf. This kind of “class” action is a new development in Ireland and is likely to be availed of when there is a significant breach of personal data on a wide scale affecting a large number of individuals.

Two of these not for profit type organisations, NOYB (‘None of Your Business’) in Austria and La Quadrature du Net (‘La Quad’) filed complaints in some European countries against large tech companies within a short time of GDPR coming into effect. There is nothing stopping them from popping up in Ireland.

Right to Compensation and Damage

The right to compensation and damage is set out in regulation 82 which states,

Right to compensation and liability

1. Any person who has suffered material or non-material damage as a result of an infringement of this Regulation shall have the right to receive compensation from the controller or processor for the damage suffered.

2. Any controller involved in processing shall be liable for the damage caused by processing which infringes this Regulation. A processor shall be liable for the damage caused by processing only where it has not complied with obligations of this Regulation specifically directed to processors or where it has acted outside or contrary to lawful instructions of the controller.

3. A controller or processor shall be exempt from liability under paragraph 2 if it proves that it is not in any way responsible for the event giving rise to the damage.

4. Where more than one controller or processor, or both a controller and a processor, are involved in the same processing and where they are, under paragraphs 2 and 3, responsible for any damage caused by processing, each controller or processor shall be held liable for the entire damage in order to ensure effective compensation of the data subject.

5. Where a controller or processor has, in accordance with paragraph 4, paid full compensation for the damage suffered, that controller or processor shall be entitled to claim back from the other controllers or processors involved in the same processing that part of the compensation corresponding to their part of responsibility for the damage, in accordance with the conditions set out in paragraph 2.

6. Court proceedings for exercising the right to receive compensation shall be brought before the courts competent under the law of the Member State referred to in Article 79(2).

The game changer in this regulations is the reference in subsection 1 to “material or non-material damage”.

Up to this point you had to show you had suffered actual loss or damage in Ireland to be compensated, but you could not be compensated for non-material damage.

You will also see that subsection 1 refers to “controller or processor”. Prior to this only the controller could be held liable but now a processor can be also named as a defendant.

Article 78 sets out the right of the data subject to sue-that is, a judicial remedy. It states,

Article 78

Right to an effective judicial remedy against a supervisory authority

1. Without prejudice to any other administrative or non-judicial remedy, each natural or legal person shall have the right to an effective judicial remedy against a legally binding decision of a supervisory authority concerning them.

2. Without prejudice to any other administrative or non-judicial remedy, each data subject shall have the right to a an effective judicial remedy where the supervisory authority which is competent pursuant to Articles 55 and 56 does not handle a complaint or does not inform the data subject within three months on the progress or outcome of the complaint lodged pursuant to Article 77.

3. Proceedings against a supervisory authority shall be brought before the courts of the Member State where the supervisory authority is established.

4. Where proceedings are brought against a decision of a supervisory authority which was preceded by an opinion or a decision of the Board in the consistency mechanism, the supervisory authority shall forward that opinion or decision to the court.

This right to bring a data protection action in Ireland is set out in section 117 of Data Protection act, 2018. This action is founded on tort-that is, a civil wrong, and can be instituted in the Circuit Court or High Court.

Section 117 obliges the plaintiff data subject to prove that

his or her rights under a relevant enactment have been infringed as a result of the processing of his or her personal data in a manner that fails to comply with a relevant enactment

The critical change now is a data subject can sue for material and non material damage and non material damage is set out in recital 85 as follows:

A personal data breach may, if not addressed in an appropriate and timely manner, result in physical, material or non-material damage to natural persons such as loss of control over their personal data or limitation of their rights, discrimination, identity theft or fraud, financial loss, unauthorised reversal of pseudonymisation, damage to reputation, loss of confidentiality of personal data protected by professional secrecy or any other significant economic or social disadvantage to the natural person concerned

You will see from regulation 82 above, section 2, that the controller and processor will be held liable where they are not compliant with the regulations; it is irrelevant whether they were negligent or at fault in any way.

How much compensation?

It is too early to say what level of compensation Irish courts will award, especially for non material damage such as damage to reputation or unauthorised reversal of pseudonymisation or loss of confidentiality.

Clearly, from the perspective of a controller or processor the smart thing to do is try to ensure that there is no breach of personal data rights in the first place. However, it is vital that a breach is notified to the Data Protection Commissioner within 72 hours of becoming aware of the breach as the Act refers to doing so “without undue delay”.

Section 85 Data Protection Act 2018 states:

85. Where a processor becomes aware of a personal data breach, the processor shall notify the controller on whose behalf the data are being processed of the breach—

(a) in writing, and

(b) without undue delay.

Further reading:

The General Data Protection Regulation (GDPR) in Ireland-the Essentials

Data Protection Breaches-Are You Entitled to Damages?

 

Unjust Enrichment and Quantum Meruit-Why You Should Know About This Equitable Principle

 

unjust enrichment

Have you ever heard of a latin phrase, “quantum meruit”?

You may be thinking that you have not, and you are none the worse for it, either.

However, this archaic latin phrase could become your friend some day if you are involved in a dispute about a contract you are a party to.

Let me explain.

Firstly, “quantum meruit” means “what he has earned” or “as much as he is entitled to”. It would arise where you claim you are entitled to be paid for goods or services supplied to the other party where you are not covered by the strict interpretation of the terms of the contract, or even where there is no contract.

It is said, therefore, to be a quasi-contractual claim.

Let’s say you have agreed some terms of a proposed contract, but you have not agreed on price. Nevertheless, you perform the contract with the implied or express agreement of the other party.

The other party cannot claim that because you did not agree on price that you are not entitled to be paid. No, you would be entitled to be paid on a “quantum meruit” basis-that is, as much as you have earned or deserve.

Another example would be where the other party has agreed to pay you a “reasonable sum” for the goods or services or where the extent of the work to be performed was agreed and set out in the original contract, but the work carried out has exceeded what was agreed.

A further example would be where you have exceeded the precise terms of the contract. This could arise in an employment situation, or in a typical building/construction situation where you go over and above what you were supposed to do and the other party allows you to do so and is happy to enjoy the extra benefit of your work or goods.

At its essence, therefore, a quantum meruit claim is based on a claim for a reasonable sum for the services rendered or goods supplied.

Quantum meruit is what you might be awarded arising from your claim based on the equitable principle of unjust enrichment-that is, you are claiming that the other party has been enriched at your expense and you are entitled to be paid in equity and good conscience.

What is unjust enrichment?

Unjust Enrichment

Broadly speaking there will be four elements to unjust enrichment:

  1. You provided valuable goods or services to the other party
  2. The other party accepts your goods or services and benefited from them
  3. The other party was reasonably notified, or should have inferred, that you expected to be paid
  4. It would be inequitable or unconscionable for the other party not to pay

What you will be entitled to, if you are successful in your legal proceedings, will be quantum meruit-that is, what is reasonable for your goods/services.

You will see from the above that unjust enrichment can arise

  1. Where there is no contract
  2. Where there is a contract, but its terms have been exceeded by one of the parties.

A useful decision in this area of law is Vedatech Corporation v Crystal Decisions (UK) Ltd. & Anor [2002] EWHC 818 (Ch) (21st May, 2002) [2002] EWHC 818 (Ch).

The circumstances where a claim of unjust enrichment can arise are myriad, and include employment, construction, and in all situations where goods or services are supplied.

Warnings and Performance Related Problems in the Irish Workplace

It’s so easy for the employer to get this wrong.

And when employers make mistakes, they can be costly.

Unless there has been a fundamental breach of the employment contract by gross misconduct or dishonesty on the part of the employee, warnings are essential to show fair procedures were followed.

performance-related-problems

However, it has been held in some cases that the inadequacy of performance was so bad that warnings would be ineffective.

There is no set format for a warning but the following principles must be adhered to:

  • It should be clear and unequivocal; a broad statement or large hint will not suffice
  • The cause of the problem should me made clear to the employee, eg competence, conduct etc.
  • The consequences for the employee should be spelt out if the warning is not heeded eg that her job is in jeopardy.

The employee must also be given time and opportunity to improve.

Warnings should lapse or be expunged from the record after a certain period of time and the Employment Appeals Tribunal has held that warnings cannot remain indefinitely on an employee’s record.

Performance Related Problems

An employer seeking to justify the dismissal of an employee because of poor performance should be able to do the following:

  • Explain how the problem came to light, especially if the employee is in the job for a good period of time
  • Show that he investigated why performance is not up to scratch-it is not sufficient to merely show that performance was inadequate
  • Clearly warn the employee that his performance is falling short
  • Counsel the employee as to the need to improve and the assistance offered to help with this
  • Monitor the response to the warning
  • If there is no improvement, show that they investigated why there was no improvement
  • Give a final warning that is clear and unequivocal setting out what the problem was, the consequences of failing to meet the required standard and when the consequences would be likely to result
  • Show evidence of the failure to meet the standard of the final warning and provide evidence to the employee giving him an opportunity to respond and make a case for his retention in employment.

Targets

If targets are used to measure the employee’s performance and work, the employee must be given sufficient time to improve and warned as to the consequences of failing to reach the target.

In addition, where an employee meets the target but falls back to an old unacceptable level, the EAT has held on occasion that the procedure should revert to the 1st stage of the warning procedure.

The EAT has also held that unreasonable targets leading to dismissal can amount to unfair dismissal.

How to Draft an Employment Contract-What Express Terms Should Be Included?

An employment contract in Irish employment law is made up of implied terms and express terms.

employment-contract-express-terms

Implied terms fall into 4 categories:

1. Those implied by statute

2. Terms implied by custom and practice

3. Terms implied by law

4. Terms implied by collective agreements in unionized employment.

There is nothing the employer can do about these implied terms. However, the express terms-agreed between employer and employee-are a matter for negotiation and agreement between the parties.

What express terms should be included in a contract of employment? (Note: there are some terms which must, by law, be included in a statement of the terms of employment which must be given to an employee under the Terms of Employment (Information) Act 1994. There are other terms which are strongly advisable. And there are yet more terms to consider depending on the particular role)

1. The Parties

Who the employer is is a vital term and it may not be entirely clear unless set out in the contract.

2. Job Function/Description

The temptation for the employer here is to have as widely drafted a job description as possible. However, this can cause problems if the need for redundancy arises as the employee may claim that their job description requires them to carry out duties different from those which the employer wishes to make redundant.

3. Hours of Work

The hours of work term of the contract should deal with

• Overtime (paid or not)

• Shifts

• Breaks.

The most important piece of legislation in this area is the Organisation of Working Time Act, 1997.

It is advisable for the employer to also provide for the right to lay off or place employees on short time (there is no general right in law to do this).

4. Place of Work

It is advisable for employers to have a geographical mobility clause in the contract as an express term. Here is an example:

The company reserves the right when determined by requirements of operational efficiency to transfer employees to alternative work and it is a condition of employment that they are willing to do so when required.

However, the employer must act reasonable and responsibly in this regard.

5. Exclusive Service

Decisions in Irish employment law have held that employees have the right to work for another employer in their spare time. However, this work could not conflict with their duties of confidentialiy and loyalty to their employer.

6. Probation

Any probationary clause should not exceed 12 months. It should also provide for an extension of the initial period (say 6 months) and should have a notice period less than outside the probation period.

Reference should also be made to the disciplinary procedures of the company not applying during the probation period. However, if this is the case, then a probationary policy should be drafted by the company setting out what procedure will apply during the probationary period.

Even though an employee is on probation, s/he is still entitled to fair procedures and natural justice when it comes to termination.

The wording of the probationary period is also important. The District Court in Ireland has held that the following clause gave rise to an entitlement to the employee to be paid for the remaining 5 months of a probationary period when he was dismissed after one month:

The first six months of this contract shall be a probationary period.

This one clause is a good example of why you should have a legal professional draft any contract of employment you require.

7. Term of Contract

The term or duration of the contract is only applicable for a fixed term or specified purpose contract.

8. Salary/Pay

This, clearly, is a very important clause in any contract of employment. Setting out basic salary is straightforward; bonuses and commissions can cause problems if not set out clearly.

The employer will seek to have the payment of a bonus at his/her discretion; employees will be keen to see how they can become entitled to a bonus.

Termination during a bonus period should also be clarified and agreed.

9. Holidays/Annual Leave

Minimum holiday entitlements are provided for in the Organisation of Working Time Act, 1997. (See how to calculate holiday entitlements)

However, this clause should also make provision for when holidays can be taken as well as recognising that any extra holidays would be over and above the statutory entitlement to holidays and public holidays.

10. Company Car

The entitlement to a company car should be set out in this clause with clarity as to the make, model, value, etc. allowable.

11. Sick Pay

The sick pay clause will set out whether the employer operates a sick pay scheme or not. There is no general entitlement to sick pay in Ireland.

However, this entitlement may be implied from custom and practice in the workplace.

The employers may operate a sick pay scheme or an income continuance plan or health care insurance entitlements.

This needs to be clear from the outset in the employment contract as sick pay is an area which causes great difficulty for both employer and employee in the absence of clarity.

12. Pension

If a pension is part of the remuneration package, reference should be made to it in the contract and if there is a company pension scheme it is important that an employee is not excluded in such a way as to leave the employer open to a successful claim for direct/indirect discrimination.

13. Retirement Age

There is no statutory retirement age in Ireland (save for in the public service and a small number of industries). For this reason, a retirement age should be spelled out in the contract.

It is worth noting that just because there is a retirement age specified in the pension scheme does not mean that there is an implied retirement age in the contract of employment.

14. Grievance Procedure

The method of processing grievances in the employment should be referenced here. Employees should be bound to exhaust the internal grievance procedure first before resorting to outside bodies.

The statutory code of practice, Industrial Relations Act, 1990 (Code of Practice on Grievance and Disciplinary Procedures) (Declaration) Order, 2000 (Statutory Instrument 146/2000) contains the principles to be applied by the employer in any grievance and disciplinary procedure.

15. Disciplinary Procedure

Employers should have a disciplinary procedure to ensure fair procedures and natural justice where necessary.

SI 146/2000 sets out the basic principles which any disciplinary procedure should follow. These include:

• What will happen to deal with a complaint/allegation

• How many stages will be followed in each event

• The employer’s right to choose which stage to commence the procedure and the penalty to be imposed

• The right of representation of the employee

• Whether there is a right of appeal to any decision taken to impose a penalty.

 

16. Restrictive Covenant

This clause deals with the right of employees to compete with their former employer once they have left employment with that employer. There are 2 aspects to any ‘non compete’ clause:

• The common law entitlement of the employer to protect trade secrets and confidential information

• The Competition Act 1991.

Regardless of the express term in any contract of employment dealing with this area, the Courts recognise the common law right of the employer to protect confidential information and trade secrets-even when the employment relationship is terminated.

However, there is no common law restriction on an employee competing with a former employer once she leaves employment. This is why a ‘restrictive covenant’ is a good idea in the contract-to protect, for a reasonable time and over a reasonable geographic area, the employer’s legitimate interest.

This is not a restriction on normal trade or general competition post-employment though; it must be a restriction to protect a specific legitimate interest.

However, if the employer breaks or repudiates the contract, he will generally be unable to rely on any restrictive covenant in this connection.

17. Termination of Contract

The notice period for termination of employment is a critical clause. If there is none and the contract is silent in this regard, then ‘reasonable’ notice must be given by the employer.

This will vary from contract to contract depending on a number of factors such as job function, length of service, age of employee, custom and practice, etc. In short, what is ‘reasonable notice’ in each case will depend on the facts of the individual case, bearing in mind the factors outlined above.

It is strongly advisable for the employer to specify a notice period in the contract in order to avoid a claim for wrongful dismissal.

Unless it is stated in the contract, notice does not have to be in writing; but it does have to be clear and unequivocal.

Notice given during times of leave or illness is valid, except for during maternity leave which is protected.

The notice period in the contract cannot be less than that provided for in the Minimum Notice and Terms of Employment Act, 1973 (as amended).However, if an employee is dismissed for misconduct s/he loses his/her entitlement to notice.

The employment does not come to an end until the end of the notice period, even where a person is not required to work the notice period and has been ‘paid off’.

18. Search Clause

A search clause is commonly used in many contracts allowing the employer to search the employee’s locker, baggage, vehicle, etc.

Without this search clause, any search, without consent, could be considered to be an assault.

19. Patents, Inventions, and Copyright

Unless there is agreement to the contrary, any copyright in material which is made by the employee in the course of employment is the property of the employer. The same principle applies to research and development work carried out which leads to an invention.

20. Share Options

A share options clause may be necessary. Provision should be made for the employee moving location or changing job function.

21. Bullying and Harassment

An anti-bullying and harassment policy should be appended to the contract of employment as the employer is obliged by law to prevent bullying and harassment occurring in the workplace.

22. Internet and email

Reference should be made to the company’s policy on internet access, email and internet use. A separate policy in this regard should be provided by the company to the employee.

23. Resignation of Office or Directorships

Resignation from offices held, including directorships, should be provided for in the contract of employment.

24. Proper Law

The law governing the contract should be spelled out and is very important where an employee may be required to work abroad.

25. Other

Other clauses which may be included, depending on the specific requirements of the employer, may include

• Wearing of uniforms, dress code

• Punctuality and attendance

• Responsibility for tools, property, uniforms, clothing, boots, etc

• Requirement to hold a driving licence

• Compassionate leave

• Parental leave (subject to statutory entitlements)

• Work standards

• And more.

If you are an employer and you don’t have existing contracts of employment for your employees, or you are concerned about the contracts you do have, we provide a professional, cost effective contract review and drafting service. We also provide staff handbooks containing the policies and procedures you need for your workplace including grievance, disciplinary, dignity at work, and health and safety at a minimum.

Simply use the contact us form to make an enquiry.

If you are an employer, you may be interested in our employment law services for employers which are designed to give you peace of mind in this area and allow you to spend your valuable time running your business.

Changing Service Providers and TUPE-Does TUPE Apply?

Whether the change of service providers is covered by the TUPE regulations will depend on the particular facts of the situation.

tupe-regulations
TUPE regulations-transfer of undertakings

Firstly, it is worth remembering that TUPE covers the transfer of undertakings.

To be a transfer of an undertaking it must relate to a stable economic entity whose activity is not limited to performing one specific works contract.

Such a transfer would only come within the terms of TUPE if it included the transfer of a significant body of assets to the new contractor or a transfer of a ‘major part of the employees’ performing the function.

The mere loss of a service contract to a competitor cannot by itself indicate the transfer comes within the meaning of the TUPE directive. Because the original undertaking does not cease to exist and has merely lost an asset

Each case will be judged on the particular circumstances but factors to be considered would be:

  • Whether assets or resources are taken over by the new contractor
  • Whether employees have been taken over by the new contractor.

The European Court of Justice has held in the Suzen case that a contract for a service provided by an old contractor being transferred to a new contractor does not necessarily mean that an economic entity has been transferred.

The findings in the Suzen case have been generally applied in Ireland by the Employment Appeals Tribunal (EAT).

Irish Cases re Changing Service Providers and TUPE

Cannon v Noonan Cleaning Ltd and CPS Cleaning Services Limited [1997]

This case concerned the contract for the cleaning of Balbriggan Garda Station. The cleaning contract was lost to CPS Cleaning Services Limited.

No tangible assets were transferred between Noonan Cleaning and CPS Cleaning.

Cannon turned up for work with CPS cleaning who sent her away and did not employ her.

The EAT held that there was no transfer of undertaking as it applied the principles of Suzen.

Shiels and Others v Noonan Cleaning and ISS Contract Cleaners Ltd [1997]

Sheils and the other claimants were employed by ISS Contract Cleaners ltd. ISS lost the cleaning contract which was won by Noonan Cleaning.

Noonan cleaning refused to employ the claimants.

ISS Contract Cleaners Limited accepted that the employees had no right to transfer to Noonan because no assets had transferred between the two companies and were entitled to redundancy from ISS. The EAT agreed.

Collins v Excel Property Services Limited [1998]

Mrs. Collins was employed by Excel Property Services Limited who were awarded the contract for cleaning the school by the Board of Management of the school.

The Board put the contract out to tender and Excel Property Services Limited were unsuccessful.

Mrs. Collins and four other employees transferred to the new cleaning contractor. However, they felt that the machines provided by the new contractor were not of the same standard as previously provided with Excel.

They terminated their employment and Mrs. Collins claimed redundancy from Excel.

Excel claimed there was no liability as it was a transfer of undertaking and the liability lay with the new contractor.

The question was: was this a transfer of undertaking?

The Court recognised that there would not be a transfer of undertaking if there was no transfer of significant tangible or intangible assets.

However, in this case Mrs. Collins was held to have transferred under the Acquired Rights Directive and as a result there was no case against Excel.

In addition, the EAT held that there was not a redundancy situation as the school still needed to be cleaned.

Digan v Sheehan Security Corporation Limited [2003]

This case involved the transfer of a security contract at the Athlone Accommodation Service.

The EAT again held, inter alia, that a changeover of contractors per se does not amount to a transfer of undertaking unless there is also a transfer of significant tangible or intangible assets.