The question for the EAT in this case was whether an employee who worked abroad for a British company, under a contract of employment governed by English law, which required a notional deduction for UK tax and was eligible to a Civil Service pension was able to show an overwhelmingly strong connection with Great Britain and thus entitled to bring claims under the Employment Rights Act 1996 and the Equality Act 2010.
The EAT noted that the fundamental principle is that an employee who is working or based abroad at the time of his dismissal is excluded from the protection. The general rule is that the place of employment is decisive unless where the connection between Great Britain and the employment relationship is sufficiently strong to enable it to be presumed that, although they were working abroad, Parliament would have regarded it as appropriate for a tribunal to deal with the claim.
The Claimant was an employee of the British Council (a public corporation and registered charity) managing a teaching centre in Bangladesh. He was “truly expatriate” and not a civil servant. However he was employed under a contract of employment which expressly incorporated English law which entitled him to a Civil Service Pension and made a notional deduction for UK tax. He resigned and brought claims against the British Council under the Employment Rights Act 1996 (constructive unfair dismissal, automatic unfair dismissal and detriment by reason of public interest disclosure) and the Equality Act 2010. It was necessary for him to show an especially strong connection with Great Britain and British employment law in order to establish that the Employment Tribunal had jurisdiction to entertain his claims. His claims were rejected by the Employment Tribunal as being outside of its jurisdiction. It stated that “such connections as there are to the UK do not amount to connections of sufficient strength to displace the general rule”. The Claimant appealed.
The EAT allowed the appeal enabling the Claimant to bring his claims before an Employment Tribunal. The following factors were all relevant to finding “an exceptional degree of connection with Great Britain and British employment law”:
- The Claimant was a UK citizen recruited in the UK to work for a UK organisation
- His employment contract was subject to English law (this factor on its own cannot compel the conclusion that territorial jurisdiction is established but it will always be significant if a contract is governed by English law);
- He was entitled to a Civil Service pension – an entitlement granted by a UK Act of Parliament which specifically added the British Council to a list of institutions of a generally public or governmental nature. This created another strong link to the UK and to UK employment law. The Claimant received it because he was in a special category of being UK appointed staff (and not granted to locally employed teachers);
- The Claimant’s salary was subject to notional deduction for UK income tax to maintain comparability with the position if he were working in the UK. This also was an exceptional provision to find in the contract of an expatriate employee.
- The employer was a “non- departmental public body” which, while not directly part of government, is recognised as playing such a part in the UK that its status permits it to provide Civil Service pensions for its employees.
There were also additional factors which confirmed the exceptional degree of connection with Great Britain and British employment law such as his salary being paid in and funded in London and an entitlement to statutory sick pay and contractual holiday rights. Conversely, while the Claimant had an important connection with Bangladesh when he was employed there, running the language centre full time, it was part of a broader operation serving UK cultural relations and educational opportunities and he was only expected to stay in Bangladesh for a limited period.
What to take away
The EAT has provided a useful list of factors to consider, and reiterating that various factors should be viewed together rather than in isolation. Although the EAT said that the employment tribunal had set out the law correctly it “did not carry out in any structured way the exercise of looking at the factors as a whole pointing towards and away from a connection with Great Britain and with British employment law”. This included analysing the lack of connection with another jurisdiction.