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Are Tribunals interested in tales of Arabian nights?

Employees who work across borders or who move from one country to another create an extra layer of complexity for Employment Tribunals.

Employees who work across borders or who move from one country to another in the course of their employment create an extra layer of complexity for Employment Tribunals, given that there is a preliminary question of whether their rights lie in this country or whether their claims should be brought in the courts and tribunals overseas.

It is a question which needs to be looked at in the specific context of the rights in question, for there is no one answer that fits the whole spectrum of employment law rights. Nor does the Employment Rights Act 1996 offer much help – when the old test of whether an employee was “ordinarily working” in Great Britain was repealed, nothing was put in its place.

The case of the Dubai office

The problem is well illustrated in the recent case of Creditsights v Dhunna, which concerned the right to claim unfair dismissal. Mr Dhunna was employed by the UK subsidiary of a US investment research company. He worked in London but he was increasingly seeking to sell the company’s products into the Middle East and he wanted to live in that part of the world. When the Dubai office was established this proved the ideal move for Mr Dhunna and he transferred to that office, which was considered a branch of the London office for internal administrative reasons. By the time he was dismissed he had spent three and a half years in London and just under a year in Dubai. The question for the Tribunal was whether he could bring a claim for unfair dismissal in the Employment Tribunal in this country.

There might be a number of reasons why an employee might wish to bring a claim here rather than in another jurisdiction, including convenience and the value of the likely remedies available to the employee.  In Creditsightsthe Tribunal got rather bogged down in this issue.

The test that is to be applied in such situations is well established, having been set out by Lord Hoffman in his Judgment in Serco v Lawson.  That was a case where the issue was acute due to the fact that the employee had moved to work on Ascension Island: the attraction of bringing a claim in the Employment Tribunal in Great Britain was obvious. Lord Hoffman identified four sets of circumstances in which the protection of the employment tribunals might be available:

  • Firstly, where the employee is working here when the employment comes to an end (which raises a presumption that the employee has local rights, other than where the employee is working on a casual visit);
  • Secondly, peripatetic employees who have their base here – so a pilot based at a British airport might spend much of his working time abroad, in the air, but it is the location of his base that is important, for that is “home”;
  • Thirdly, certain expats – so for example the man on Ascension Island was really operating in a British enclave overseas; and
  • Fourthly, there may be others who don’t fit any of these categories but who have an equally strong connection with Great Britain.

Given that Mr Dhunna lived and worked abroad, the assessment of whether he had a sufficiently strong connection with Great Britain necessarily involved a comparison of his Dubai connection with his Great Britain connection. What the Court of Appeal stressed, however, is that this comparison should not descend into a comparison of the employment protection laws which are available in each location. This exercise is not about which legal system provides the better protection for the employee.

What should you do?

Such matters need careful consideration at the point that you, as the employer, decide to move your employee’s location. Given the materially different level of severance cost that can apply in overseas jurisdictions – with this country sitting between simple “hire and fire” jurisdictions and jurisdictions where the cost of severance can be remarkably high – it is an important part of relocation planning. 

If you have any issues with employees going on overseas assignments or you are considering whether there is a need to follow UK law when addressing issues with those working abroad, please speak to Micheal Ryley, Partner or you usual contact in the Weightmans’ employment and pensions team.