Employment Rights for Overseas Employees: Lawson -v- Serco Ltd

Note: This case was previously reported on the Workplacelaw Network by Daniel Barnett, 28 March 2003, "Overseas Workers: Momentous Decision Widens the Jurisdiction of Employment Tribunals".

In a landmark decision that is literally far-reaching, the Employment Appeal Tribunal (EAT) has ruled that tribunals have jurisdiction to hear unfair dismissal claims regardless of where in the world the employee works, in any case where the employer is incorporated in England and Wales or carries on business here.

In Lawson -v- Serco Ltd (heard last December, with judgment issued in March) Jacques Algazy and Paul Spencer of Cloisters (instructed by Mills Kemp & Brown with Hinchcliffe Baker) represented the employee at the Employment Tribunal and the EAT free of charge.

Background

Mr Lawson worked for Serco from September 2000 until April 2001. Serco provided security services at the RAF base on Ascension Island in the South Atlantic, and he was a security supervisor there. Mr Lawson is of British nationality and domiciled in England. Serco is a company registered in the UK with a head office in Surrey. The job was advertised in the UK, where Mr Lawson was interviewed for it. He was paid in sterling in the UK into his UK bank account. He was not liable to UK income tax because of working abroad. His contract of employment referred to various UK statutes.

He claimed unfair dismissal, but in October 2001 the Employment Tribunal at Watford decided that they did not have jurisdiction over his claim, and he appealed to the EAT.

Judgment

The EAT decided that:

1. The law which applies to the contract does not determine the jurisdiction of the tribunal. Section 204(1) Employment Rights Act 1996 does not permit that approach (paras.7-9 of the judgement).

2. Section 244 of the Act provides that it "extends to England and Wales and Scotland but not to Northern Ireland" but that defines the territory within which the Act applies, and does not define those who are to be treated as subject to that territorial limit. The repeal of Section 196 (with effect from October 1999) removed limits on jurisdiction from the Act (paras.1 and 10-11).

3. The Employment Tribunal (Constitution and Rules of Procedure) Regulations 2001, made under the Industrial Tribunals Act 1996, in effect define a tribunal claim to include a claim against an employer who carries on business in England and Wales, there being similar provisions for Scotland (paras.12-14 and 18).

4. There are no other restrictions on jurisdiction, although European regulations provide that jurisdiction also depends on the employer being a UK company or having its central management in the UK (paras.15-18).

5. Although there might be another jurisdiction in which the claim could be brought - Ascension Island in this case - Employment Tribunals cannot close their doors to parties who wish to appear before them; the power to "stay" proceedings on the ground that another forum would be more convenient does not exist in the context of Employment Tribunals (paras. 19-21).

6. Once jurisdiction has been decided, the Employment Rights Act applies the UK law to an unfair dismissal, irrespective of which country's laws apply to the contract of employment (paras.22-25). This appears to be the case even where another EU country is concerned (para.26).

7. The Working Time Regulations applied, even though Mr Lawson worked exclusively in Ascension Island (paras.27-28). On this question, the EAT found it "difficult" to interpret Section 104 Employment Rights Act, noted the "fear of opening of floodgates in relation to hours of work abroad that was expressed in the decision of the Tribunal", and reached their conclusion "on balance and with hesitation". But the EAT said that even if they were wrong, Mr Lawson could still succeed if he believed in good faith that the Working Time Regulations did apply.
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