A recent Employment Appeal Tribunal (EAT) decision has confirmed what employment lawyers already knew – the law on territorial scope and international jurisdiction is fiendishly complicated.
Background
In this case, the EAT upheld a tribunal’s decision confirming that it has both territorial and international jurisdiction to hear claims brought by a UK national, who worked for an employer headquartered outside the UK.
The claimant worked for the organisation for around 5 years, mainly on assignments in Asia. Her employment contract was governed by the law of a non-UK jurisdiction. She is a British citizen and moved to London for personal reasons in early 2017. Although the employer had a UK presence, it refused to assign her work in London except for one day in June 2017. The employer dismissed the claimant in August 2017, though she remained on the payroll until the end of that year.
The employee brought claims in the UK for unfair dismissal, discrimination, victimisation, equal pay and holiday pay. The employer challenged the tribunal’s jurisdiction, arguing that her employment fell outside the territorial scope of UK employment law.
The employment tribunal found that it had jurisdiction over the claim confirming that her employment had a sufficient connection with Great Britain. The employer appealed, but the EAT agreed with the tribunal and dismissed the appeal.
EAT’s key findings
- Territorial scope: The EAT accepted that an employee’s base can shift over time. It found that, from March 2017, the claimant had effectively become London-based. The evidence showed that she did go to London to work, she was not on medical leave and was paid at the time. Drawing from the “connection test” in the leading House of Lords case on territorial scope (Lawson v. Serco Ltd), the EAT confirmed there was a sufficient connection to bring the claims within UK territorial scope.
- International jurisdiction: The EAT disagreed with the tribunal’s conclusion that it necessarily has jurisdiction if a claim is within territorial scope of a statute. The questions of territorial scope and international jurisdiction are separate. The EAT held that it was necessary to consider the Recast Brussels Regulation (the Regulation), but the tribunal had done so. The Regulation regulates jurisdiction in civil matters, primarily where the defendant is based in an EU member state. The EAT found that, under the Regulation, a company based outside the EU cannot insist on only being sued in its home country’s courts. This is the case even if the dispute is not connected to any of the company’s EU offices or branches. The purpose of the Regulation is to protect employees rather than exclude them from justice. The claims were within the UK tribunal’s jurisdiction, both under domestic principles and the Regulation.
- Service of proceedings: The employer challenged the service of documents, but this ground also failed. The EAT confirmed that there is no requirement to get permission to serve an employment tribunal claim out of the jurisdiction, where a respondent is domiciled abroad.
Takeaways
This ruling reinforces that UK tribunals can have jurisdiction over claims by employees working abroad if their connection to the UK is sufficiently strong, even against non-UK employers. It also demonstrates that an employee’s work base can evolve over time and tribunals will consider the reality of the working arrangement rather than just contractual terms. The “connection test” from Lawson v. Serco Ltd also continues to be the key test for determining territorial jurisdiction in employment cases.
International employers need to be aware of this decision, particularly if they employ peripatetic staff:
- Evolving work base concept: The recognition that an employee’s base can shift over time introduces a dynamic element to jurisdictional assessments. Be aware that even temporary relocations might establish sufficient connection to the UK if they become more permanent in nature.
- Peripatetic v. expatriate distinction: The EAT’s characterisation that the claimant was a peripatetic worker rather than an expatriate was crucial to the outcome. Consider how your internationally mobile employees would be classified under this framework.
- Practical risk management: Conduct jurisdictional risk assessments when employees relocate, even temporarily. This should include reviewing contractual provisions regarding applicable law and jurisdiction clauses. However, as this case demonstrates, these may not be determinative.
- Post-Brexit implications: While this case applied the Regulation, it only applies in the UK to proceedings that started before the end of the Brexit transition period (31 December 2020). As a result, the post-Brexit landscape introduces additional complexity. The judgment suggests UK tribunals will continue to take an employee-protective approach to jurisdiction questions even as the legal framework evolves.
- Procedural considerations: The clarification regarding service of proceedings is particularly valuable for claimants. There is no requirement to obtain permission to serve tribunal claims on respondents outside the UK, which streamlines the process for bringing claims against international employers.
For in-house counsel at multinational organisations, this case underscores the importance of considering UK employment law compliance even for staff primarily working abroad, particularly where there is any connection to the UK. The threshold for establishing territorial jurisdiction appears to be relatively low where an employee can demonstrate efforts to establish a UK base, even if the employer does not formally recognise this arrangement.
