Introduction
On 7 January 2023, EJ Klimov handed down judgment in Beldica v The British Council (Case No. 2202073/2021) on the preliminary issue of territorial jurisdiction. The Tribunal held it did have jurisdiction to hear a claim brought by a former employee of the British Council despite the fact she lived and worked in Dubai. Whilst it is only a first instance decision, EJ Klimov’s detailed 54-page judgment is likely to be of interest to many employment practitioners.
Anna Dannreuther of Old Square Chambers appeared for the successful Claimant, acting pro bono via Advocate.
Facts
The Claimant was a Romanian national who lived and worked in Dubai. In March 2016 she began working in the Dubai Office of the British Council as a HR Business Partner. Her role was to provide HR support to the Council’s operations across the Middle East. The Claimant was recruited to the role whilst living in Dubai and the decision to offer her employment was made by staff within the Dubai office. The Claimant was paid in the local currency (United Arab Emirates Dirham) and was treated as a local employee for the purposes of taxation and social benefits. Whilst in her role, the Claimant never worked or travelled on business to the UK, nor did her work concern matters regarding the Council’s operations in the UK. The Claimant’s employment was subsequently terminated on 31 January 2020.
In response to the termination of her contract the Claimant initially tried to bring proceedings against the Respondent in the UAE Labour Court. However, the Claimant ran into administrative difficulties. She was unable to bring a claim because her contract of employment had not been registered by the Respondent with the relevant authorities. This prevented her from submitting a claim.
On 6 May 2021, the Claimant brought a claim in the Employment Tribunal claiming unfair dismissal and redundancy pay under the Employment Rights Act 1996 (‘ERA’), and pregnancy or maternity discrimination under the Equality Act 2010 (‘EqA’). The Respondent subsequently filed a response contesting the Tribunal’s territorial jurisdiction to hear the claim.
Within his findings of fact, EJ Klimov held that, whilst there were administrative hurdles for the Claimant to overcome in respect of bringing a claim in the UAE, case law from that jurisdiction made clear that the Respondent’s failure to register her contract would not have prevented her from bringing a claim (paragraph 67).
However, the Tribunal found that even if the Claimant had filed a claim against the Respondent in the UAE, the Respondent would have entered a plea of diplomatic immunity and the UAE court would have declined jurisdiction to consider the Claimant’s claim (paragraph 73). EJ Klimov reached this finding on the basis that the Respondent had done exactly the same thing in previous claims brought against them in the UAE (paragraph 74). In this case, the Respondent had not agreed to waive their immunity (paragraph 76).
The Existing Law
In his judgment, EJ Klimov provided a very detailed overview of the relevant law in respect of the Employment Tribunal’s territorial jurisdiction.
The Judge noted that the question of territorial jurisdiction was effectively one of construction of the relevant statute (paragraph 109), and that “there was no difference in the test the Tribunal must apply in determining the territorial reach of the ERA and the EqA” (paragraph 83).
In considering the existing case law, and in particular the comments of Underhill LJ in British Council v Jeffery [2019] ICR 929 at [2(4)], EJ Klimov held that “it is necessary for the employee to show that despite working outside Great Britain, particular features of his or her employment relationship with the employer created that connection, which was sufficiently strong to overcome what Underhill LJ described in Jeffery at [2(4)] as “the territorial pull”” (emphasis added), noting that this has also been referred to as the “sufficient connection question” (paragraphs 100 & 101).
Relying on Jeffery, EJ Klimov noted that in a case of a claimant who is ‘truly expatriate’ (i.e. they live and work abroad as opposed to being a ‘commuting expatriate’) Underhill LJ said, at [2(6)], “the factors connecting the employment with Great Britain and British employment law will have to be specially strong to overcome the territorial pull of the place of work” (emphasis added) (paragraph 103).
Significant Connection Test
On the facts, EJ Klimov held that the Claimant was not just a ‘truly expatriate’ employee but was a “local employee through and through” (paragraph 176) with an “insignificant connection to Great Britain and British employment law” (paragraph 183).
However, EJ Klimov made clear that the matter did not end there. Whilst agreeing that “the territorial reach of the ERA cannot be determined by the extent of a putative employee’s knowledge as to his or her ability to pursue a claim in local courts”, (paragraph 192) the Judge held that “legitimate expectations by an employee that they would be able to enforce the rights conferred by the local employment contract and local employment law in the competent local courts is a relevant factor when it comes to consider the sufficiently strong connection question” (emphasis added) (paragraph 193). As the Claimant was, at the time of commencing employment with the Respondent, unaware that the Respondent would avoid being sued in local courts by using diplomatic immunity, she had such a legitimate expectation (paragraph 195).
EJ Klimov then went on to say that “the Respondent’s immunity from being sued in the UAE effectively destroys the connection to that system of law, no matter how strong it otherwise would have been” (paragraph 200). In such circumstances, the ‘territorial pull’ created by the Claimant living and working in Dubai was “severed” (paragraph 201).
In his words, “I cannot see how it can be said that the Claimant’s employment with the Respondent is connected to the UAE system of law, when that system does not recognise her employment contract with the Respondent for lack of registration with the [relevant authorities] and does not accept that she can enforce her contractual or statutory employment rights against the Respondent in the UAE courts by reason of the Respondent’s diplomatic immunity” (paragraph 200).
EJ Klimov was keen to stress that, ordinarily, this did not automatically create a sufficient connection to British employment law, highlighting that the authorities required “something more” (paragraph 202).
However, on the facts of this case, the Claimant’s greater legitimate expectation that she would be able to enforce her employment rights against the Respondent in the UAE meant that “something more” was provided and the Tribunal had jurisdiction to hear the claim (paragraph 276).
Human Rights Act
The Tribunal also considered detailed arguments on the impact of the HRA and Article 6 ECHR before concluding that Article 6 ECHR was engaged and therefore the ERA needed to be interpreted in a way which was compatible with the Claimant’s convention rights, under the HRA (paragraphs 260 & 263).
EJ Klimov highlighted that Article 6 by itself cannot be a ‘gateway’ to attract Convention rights or confer jurisdiction on the Tribunal where it otherwise had none before clarifying that “in this case the Tribunal can only have jurisdiction to consider the Claimant’s claims if it decides that the Claimant has the right not to be unfairly dismissed under the ERA (and the right not to be discriminated against under the EqA) despite working for the Respondent outside Great Britain” (paragraph 221).
The Judge went further and explained that it would be an error of law to conclude that the Tribunal had jurisdiction purely because in the circumstances where the Claimant is prevented from suing the Respondent in the UAE, it would put the Tribunal in breach of section 6(1) of the HRA (paragraph 221).
EJ Klimov clarified that the starting point was to establish whether the ECHR applied in this case. As the UAE was not a signatory to the ECHR, the only way the ECHR could apply was if the Convention applied extraterritorially (paragraph 223). This required some form of ‘gateway’.
The Judge noted that in Smania v Standard Chartered Bank [2015] ICR 436 at [37], Langstaff J had specifically acknowledged the possibility of the ECHR applying extraterritorially, including by way of “activity of diplomatic or consular agents” (paragraph 246). The Tribunal noted that this was the only relevant gateway in this case (paragraph 252).
EJ Klimov held that the Respondent was a public authority within the meaning of s.6(3)(b) HRA (paragraph 248) and that the Respondent was clearly acting in a public capacity. Therefore, the action of pleading immunity fell within the scope of the HRA, if it applied extraterritorially (paragraph 251).
The Judge noted that the ECtHR authorities did not require “physical presence on the foreign state’s premises” (i.e. an embassy) to establish that an individual was within the jurisdiction of the convention state (paragraph 256), instead it was the actions of the diplomatic staff which was key (paragraph 257).
EJ Klimov concluded that in order to find that the state exercised jurisdiction over an individual, “[t]he relevant question is whether the state is in a position to guarantee to the individual the Convention rights which it is said to have been breached” (paragraph 258). In this case, the Respondent’s reliance on immunity, as opposed to waiving it, equated them to a diplomatic agent exercising the UK state jurisdiction over the Claimant, thus bringing her within jurisdiction of the UK for the purposes of Article 1 (paragraph 259).
Overall Conclusion
Having conducted some very detailed analysis of the case law, EJ Klimov summarised his conclusions in 9 distinct points at paragraph 265 of his judgement, before stating that he had “little difficulty in coming to the overall conclusion that the Claimant’s case does fall within the legislative grasp.” Therefore, the Tribunal had jurisdiction to hear the Claimant’s claims.
In respect of the Respondent’s relying on diplomatic immunity in the UAE, EJ Klimov stated at paragraphs 267 and 271 respectively:
“I cannot see how it would have been in Parliament’s intention to allow the Respondent, essentially a private organisation, but through its close association with the executive branch of the UK state enjoying certain privileges (such as immunity from legal claims in foreign states), to effectively put itself beyond the reach of law. That can’t be right.” [267]
“Put it simply, in my judgment, it could not have been Parliament’s intention that a British employer organised and operating in accordance with the laws of this land can escape judicial scrutiny of its actions vis-à-vis its employees hired in foreign lands in the “legal lacuna” created by diplomatic immunity on the one hand and the “territorial pull” of the employees’ place of work on the other.” [271]
Comment
Whilst only a first instance decision, EJ Klimov’s judgment demonstrates that the Employment Tribunal can have jurisdiction to hear claims where the claimant is a “truly expatriate” employee outside of the previously established ‘posted worker’ and ‘British enclave’ exceptions.
Of particular importance is his finding that where such an employee cannot obtain a remedy in the foreign country where they are employed because of a Respondent’s immunity from suit, any ‘territorial pull’ to that country is ‘severed’.
Furthermore, the concept of an employee forming a ‘legitimate expectation’ that they will be able to bring a claim in the country of their employment is also of significant importance. Whilst ‘legitimate expectation’ is a concept more familiar to the Administrative Court as opposed to the Tribunal, this case demonstrates that it is a relevant factor when considering the issue of territorial jurisdiction.
It should also be noted that within his judgment EJ Klimov expressed his reservations about the state of the case law, specifically the requirement of ‘something more’. Indeed, the Judge suggested this requirement may have arisen from a misreading of Lord Hoffman’s endorsement of Bryant v Foreign and Commonwealth Office EAT 174/02 in Lawson v Serco Ltd [2006] ICR 250. However, he was bound by those authorities (paragraph 202). It suggests that this area of law is ripe for review in the EAT.
*This case summary was written by Old Square Chambers pupil, Carl Rix
