The EAT has held that a British National, who was dismissed whilst working for a Singaporean employer, on a Singaporean flagged ship, could not bring claims to a UK Employment Tribunal.  It has also limited the potential for employees working outside the EU to bring claims in the UK based on rights derived from EU law.

Background

The question of whether an employee who does not work entirely in the UK has the right to bring a claim under the employment protection legislation in the UK depends on an interpretation of the "grasp" of the particular statute under which the claim is brought.

In most cases, UK employment protection legislation is silent on its territorial scope and the courts have developed a test in a line of cases running from the House of Lords decision in Lawson v Serco which looks at all the facts and considers whether an employee has sufficient connection with Great Britain.

The Equality Act 2010 (the "Equality Act") contains specific provisions as to its territorial scope with regard to certain employees, including those working on ships.  Employees working on ships wholly outside Great Britain and adjacent waters will only be in the scope of the Equality Act's protection if they are employed on a UK- registered vessel that has a port in Great Britain registered as its port of choice.

The EAT has held in Bleuse  v MBT Transport Ltd that in relation to certain rights derived from EU law, the test for jurisdiction is wider than the Lawson test.  It held that a worker based outside Great Britain could be protected if he was entitled to bring a claim in the English courts and English law was applicable to the contract.  However, the status of this decision and the scope of EU law is controversial.  

Aside from interpreting the scope of the legislation which grants particular employment rights, the Employment Tribunal (Constitution and Rules of Procedure) Regulations (the "2004 ET Rules") sets out the scope of the claims which Employment Tribunals are entitled to hear.  Under the 2004 ET Rules (which have now been replaced - see below), a Tribunal shall only have jurisdiction to deal with proceedings in specific circumstances including where: (a) the respondent or one of the respondents resides or carries on business in England and Wales, or (b) had the remedy been by way of action in the county court, the cause of action would have arisen wholly or partly in England and Wales. 

Hasan v Shell International Shipping Services

Mr. Hasan, a British National, was employed by Shell International Shipping Services (PTE) Ltd, a company registered in Spain ("Shell"), under a contract of employment that provided for English governing law.  He normally resided in England and spent his leave in the UK.  Shell contracted out aspects of Mr. Hasan's day to day management to a company registered in the Isle of Man and entered into a manning agreement with an English registered company.  During his 23 year employment with Shell, 19 months of that period was spent on UK flagged vessels.

At the time of his dismissal, he was working on a Singapore flagged vessel.  He was informed of his dismissal in writing sent from an address on the Isle of Man.  Mr. Hasan brought claims for unfair dismissal, discrimination and breach of contract in respect of notice pay.

The Tribunal held that it did not have jurisdiction to hear the claims.  Mr. Hasan appealed.

Decision

The EAT upheld the decision of the Tribunal that it did not have jurisdiction to hear Mr. Hasan's claims, on the following grounds:

  • Discrimination: The Tribunal had correctly found that Mr. Hasan fell outside the scope of protection under the Equality Act as at no material time was he employed on a UK registered vessel with a registered port in Great Britain.  Mr. Hasan argued that following Bleuse, the territorial limitations of the Equality Act ought to be relaxed to allow him an effective means of exercising his directly enforceable EU derived rights.  The EAT rejected this argument as the acts complained of occurred outside the EU.
  • Unfair dismissal: Although the Tribunal had held that Mr. Hasan would have satisfied the test in Lawson to enable him to bring a claim for unfair dismissal (see above), the 2004 ET Rules did not give the Tribunal jurisdiction to hear the claim.  Mr. Hasan drew the EAT's attention to the case of Pervez v Macquarie Bank  in which the EAT gave a generous interpretation to the 2004 ET Rules to enable the Tribunal to hear a case where the Lawson test was satisfied.  In that case, it held that a Hong Kong company was "carrying on business in the UK"  when it seconded an employee to work in another company of the group in London, so that a claim could be brought.  However, the EAT considered that it could not adopt a strained construction to allow Mr. Hasan's claim to proceed given that he did not work at an establishment in the UK or aboard a UK registered vessel with a registered port, and worked wholly outside Great Britain and its adjacent waters.
  • Breach of contract: The dismissal letter was written and sent from the Isle of Man therefore the cause of action did not arise wholly or partly in England and Wales pursuant to the ET Rules. 

Comment

This is the second of two EAT decisions in which the EAT has found that the Bleuse principle on EU-derived rights does not extend to employees working outside the UK.  The first decision was the Dhunna v Creditsights case (see our previous alert on this case here).  However, the Supreme Court has previously indicated that the matter would need to be determined by the European Court, therefore, we may see further litigation on this point. 

The decision in relation to the ET Rules is likely to be of largely historic interest.  The 2004 ET Rules have now been replaced by the 2013 ET Rules, which provides for a new jurisdictional test.  Under the 2013 ET Rules, a Tribunal in England and Wales has jurisdiction to deal with proceedings where:

  • The respondent, or one of the respondents, resides or carries on business in England or Wales.
  • One or more of the acts or omissions complained of took place in England or Wales.
  • The claim relates to a contract under which the work is or has been performed partly in England or Wales.
  • The connection with Great Britain by virtue of which the claimant is entitled to present the claim is at least partly a connection with England or Wales.

The new test was intended to resolve the difficulties highlighted by Pervez so that the Tribunal clearly has jurisdiction to hear a claim whenever an employee is within the territorial grasp of the substantive legislation (i.e. where the Lawson test is satisfied).