In this article we would like to take a brief look at the extent to which employment relationships involving UK firms and offshore workers are impacted upon by UK employment law. As a UK employer there are a number of important issues for you to consider. This is a more complex and less clear topic than one might at first think. By "offshore workers" we mean workers employed on fixed installations on the UKCS.
Background to offshore workers
Offshore workers are often highly remunerated and rewarded and may not therefore be particularly inclined to raise employment law issues or pursue claims. Additionally, a large number of offshore workers are engaged as self-employed contractors and/or supplied to the operators of offshore installations by agencies. This, in turn, means that they are unlikely to have direct employment law rights against the organisation they are doing work for on a day-to-day basis.
In many areas of industry, contractors who are described as being self- employed could potentially be held to be employees if they were to bring a claim to an Employment Tribunal asserting that they have employment rights. This is because the Tribunals will look beyond the terms of a contract at how a relationship operates on a day-to-day basis. If, for example, a company has a significant degree of control over a contractor and the contractor is not at any financial risk then the contractor may be held to be an employee. Given the degree of control that is often necessary in the oil and gas industry, there is a risk of contractors potentially establishing employee status. Whilst not all employment rights apply to offshore employees or workers, they do have a wider range of rights than one might at first think and it is also unclear whether certain other rights apply to them. We have set out some commentary on this below. Additionally, where offshore workers are not genuinely self-employed, it is advisable to think about what rights they may have if any disputes arise.
Rights offshore workers clearly have
The starting point is that, whether an offshore worker is a contractor or an employee/worker, he or she will be able to enforce any rights that he/she has been given by contract. This would mean that the contractor or employee could bring proceedings to enforce rights to notice periods or pay and benefits granted by the contract.
The majority of UK statutory employment law is described as 'extending' to England, Wales and Scotland. It is not wholly clear but it is likely that this means someone must be employed on the land mass of Great Britain to be under the relevant legislation. However, certain employment rights have been expressly extended to offshore workers by legislation.
The rights that have specifically been extended to offshore workers include:
- Rights in relation to being represented by a recognised trade union;
- A right to bring an unfair dismissal claim if, and only if, the dismissal relates to activity connected to trade union recognition;
- Rights to rest periods and paid annual leave under the Working Time Regulations (with certain modifications);
- Rights in relation to discrimination at work under the Equality Act 2010; and
- The right to be automatically enrolled in a pension scheme.
The most important rights to be aware of on a day-to-day basis are those in relation to working time and rights not to be discriminated against.
With regard to working time, offshore workers are not subject to the same restrictions on night work or rest periods as onshore employees. However, employers are required to give them compensatory rest if possible and they have the same rights to paid annual leave as other employees. The 48 hour working limit applies to them with certain exceptions.
Uncertainty over unfair dismissal
Unfortunately, as a result of the way in which employment law has developed over the years, there is a lack of certainty over some rights.
For example, the right not to be unfairly dismissed is set out in the Employment Rights Act 1996. There is a power to extend that Act to offshore workers and, as mentioned above, that power has been exercised in relation to unfair dismissal claims where the dismissal relates to trade union recognition.
However, it appears that a 1976 statutory instrument extending a wider range of employment rights to offshore workers remains in force. The effect of this is that the basic right not to be unfairly dismissed may apply to offshore workers and that the same may also apply to other longstanding rights such as in relation to unlawful deduction from wages. There is also at least one reported case in which unfair dismissal claims were successfully brought by offshore workers.
Rights that will not apply
Workers or employees who are working wholly offshore will not usually be subject to the TUPE Regulations because, for a TUPE transfer to take place, there needs to be an organised grouping of employees situated in Great Britain.
Additionally, a number of employment rights introduced since 1996 such as the right to request flexible working and (surprisingly) whistleblowing legislation do not appear to have been expressly extended to employees or workers working offshore.
There are a number of cases in which employees working wholly abroad have, for example, been held to have been protected by UK unfair dismissal law because of the specific circumstances of their case. None of these cases have involved offshore workers. Given that there is a specific power to extend employment rights offshore workers and that has been done for some areas of employment law it is unlikely that the Courts or Tribunals would widen the scope of employment protections for offshore workers. Additionally, where workers spend time doing work onshore as well as offshore there is a significant chance that they will be caught by most UK employment law. It is therefore important to consider this carefully.
It is surprising how little guidance or comment there is on the extent to which UK employment law applies to offshore workers and that may be because of some of the uncertainties referred to above. Given the highly specialised skills of many workers in the sector it will usually be advisable to treat workers fairly and generously and this will often avoid employment law issues arising. However, what is worthwhile noting is that it is not safe to assume that directly engaged offshore employees or workers do not have statutory rights. Caution should therefore be exercised when employment issues arise and take advice if matters appear to be contentious.