October 15, 2014

More jurisdiction…

The Claimant was a US citizen employed by a US company. As a result of a change in role, he took on an international rotation assignment whereby he was based in the US but required to spend approximately 49% of time in the UK (any more time and he would incur tax liability). The company leased a flat in London for the Claimant’s use and his partner visited him twice a year, paid for by the company. Initially the Claimant spent a lot of time in the UK but also had spells in other countries, including the States. When his expatriate assignment was terminated and no other employment was found, he brought the claims referred to above in the UK employment Tribunal.

In respect of the unfair dismissal claim, the Judge accepted that somebody ordinarily working in the UK at the time of dismissal would demonstrate the strongest indication that Parliament would have intended the individual to be protected by unfair dismissal law. However in this case the Judge felt there was an insufficiently strong connection for the Claimant to utilise this protection. His contract stated that he would be US based but required to spend time in the UK and other places, and there was nothing to indicate that this was a sham. He was in the US when he was informed of his impending dismissal and the UK aspect of his assignment had ended before his employment terminated. Neither did his employment in the UK constitute a proper break with the main areas of his previous role or sever any of the continuity with his existing US employment. It was merely a continuation of previous work with a different emphasis – rotation of assignment internationally. Therefore the Claimant was not able to bring his claim of unfair dismissal.

With regard to the claim for automatic unfair dismissal for whistleblowing, and sexual orientation discrimination, the Bleuse v MBT Transport Limited case suggested that in respect of the Equality Act, where domestic employment law gives effect to rights derived from EU law, such as rights in discrimination, the scope of the domestic law should be construed widely enough to give effect to the EU derived right if this is at all possible. It was this argument which the Claimant put forward to try and establish his claim for sexual orientation discrimination. The argument under the Bleuse principle was rejected on the basis that the Claimant was a US citizen, employed and dismissed by a US company in the States, and the terms of this contract were orientated towards the United States. He had also specifically requested the Judge to proceed on the basis that English law was not applicable to the contract; so in these circumstances the Judge considered that EU law would not be engaged.

With regard to the whistle blowing claim, the Judge rejected the Claimant’s argument that the territorial scope should be widened in the public interest in respect of whistleblowing but the Judge concluded that there was no basis on which it could be considered that Parliament intended someone in his situation should protected by the whistleblowing sections.

The EAT upheld the Tribunal decision and rejected the Claimant’s appeal, whilst concurrently acknowledging that it might seem strange that someone working in this country does not have the same protections as those who work here all the time and that if he is required to spend substantial periods of time in the UK it would be fair enough that he should be able to benefit from the protection of the legislation here. However, given the nature of the individual’s contract and his on-going connection with the US, the EAT considered that he was not in a position to benefit from unfair dismissal protection.

The EAT also acknowledged that it might seem strange that the Equality Act would remove rights available to certain employees under the legislation which existed before the Equality Act came into force where the Claimant might have been protected by the previous legislation on the basis of working “wholly or partly in Great Britain”. This test of course had been removed in the Equality Act.

This legal update is provided for general information purposes only and should not be applied to specific circumstances without prior consultation with us.

For further details on any of the issues covered in this update please contact Gemma Ospedale, Partner in Employment on 020 7583 2222.

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