Seahorse Maritime Limited supplied crews to ships operated by a company called Sealion. The ships' crews were nationals from a number of different countries and approximately 25% of Seahorse's employees were British. Ships were typically stationed for long periods outside UK or European territorial waters. When a number of ships were taken out of service, crew members were made redundant. The recognised union, Nautilus, argued that collective consultation was required in relation to the redundancies of UK based employees on the ships.

The EAT decided that the employment tribunal had jurisdiction to hear the union's claim that Seahorse had failed to consult in respect of the redundancies of UK domiciled employees, even though they were working outside the UK when they were dismissed. It rejected Seahorse's argument that it was the connection of the establishment at which the redundancies were to be made with the UK and UK employment law that was decisive. Instead, it was the connection of the employees assigned to the establishment with the UK and UK employment law that was relevant. Those employees that could show a sufficiently strong connection would be able to enforce a protective award in the employment tribunal and the reach of the obligation to consult should be determined by the rights and means of its enforcement.

In this case the union had limited its claim to UK domiciled employees and the tribunal found that those employees had a sufficient connection with the UK and UK employment law. However, the judgment acknowledges that "it cannot have been the intention of Parliament that the obligation to consult under s188 is triggered if only one of a crew of 20 is UK based or UK domiciled and 19 have no connection with the UK other than that their contracts are governed by UK law".