Employment Status – Jurisdiction of the Employment Tribunal
A swathe of employment cases have sprung up over the last few years which have considered whether employees working abroad are able to bring unfair dismissal claims; building upon the categories set out in the landmark House of Lords case of Lawson v Serco Ltd.
The cases are derived from an ambiguity in the Employment Rights Act 1996 (ERA) as to the geographical scope of its provisions. Section 94(1) ERA provides: “An employee has the right not to be unfairly dismissed.” Section 230(1) of ERA provides that “employee” means an individual who has entered into or works under (or, where the employment has ceased, worked under) a contract of employment. Neither of these provisions contains any geographical limitation; nor is there any such limitation to be found anywhere else in the ERA.
Last year in Duncombe v Secretary of State for Children, Schools and Families (No 2) Lady Hale noted that section 94(1) could not apply to all employment anywhere in the world; as such territorial limits have been implied. Indeed, this seems to be an area of employment law likely to develop further in view of the increasingly global nature of business.
In February 2012 the UK Supreme Court has broken further ground in the much anticipated judgment of Ravat v Halliburton Manufacturing and Services Ltd . In which Lord Hope held that Mr. Ismail Ravat, a British citizen who lives in Preston, and who worked for a British-registered company (Halliburton Manufacturing & Services Ltd, based near Aberdeen) in Libya on a rotational month-on, month-off basis, could bring a claim of unfair dismissal.
Mr. Ravat was employed from 2 April 1990 as an accounts manager until he was dismissed with effect from 17 May 2006; purportedly for redundancy. At the time of his dismissal Mr Ravat was working in Libya. To add further confusion to the equation Mr Ravat reported on a daily basis to an operations manager based in Libya, but on policy and compliance issues he reported to an African Region Finance Manager employed by another UK Halliburton subsidiary based in Cairo – it was this office that made the decision to dismiss him. His human resources contact was the human resources department in Aberdeen and with another of its employees who was the HR representative in Libya.
Mr Ravat had no formal obligation to do any work during the 28 days while he was at home. Any duties that he performed in Great Britain, such as responding while at home to emails, were incidental to that overseas employment. The company’s commuter policy provided that whilst Mr Ravat was working on a foreign assignment his terms were such as to preserve the benefits, such as pay structure and pensions, for which he would normally be eligible had he been working in his home country other than those which were purely local such as a car allowance. Mr Ravat was remunerated on the normal UK pay and pension structure that applied to the company’s home-based employees; he was paid in Sterling into a UK bank account, and he paid UK income tax and national insurance on the PAYE basis.
After Mr Ravat was dismissed he invoked the UK grievance procedure, as he was advised that he was entitled to do by the HR department. The grievance hearing, the redundancy consultations and Mr Ravat’s appeal against his dismissal all took place in the Aberdeen office. Mr Ravat received a redundancy payment which was stated to have been paid to him in accordance with s.135 ERA – which confers the right to a redundancy payment to an employee who is dismissed by the employer by reason of redundancy.
The question was whether the employment tribunal has jurisdiction to consider Mr Ravat’s complaint. The Supreme Court held that it did; and remitted the case to the Tribunal to deal with the merits of Mr Ravat’s claims that he was dismissed unfairly.
Partner, and Head of Employment law, Bargate Murray.
Lawson v Serco Ltd  UKHL 3,  ICR 250,
Duncombe v Secretary of State for Children, Schools and Families (No 2)  UKSC 36,  ICR 1312