Extending Unfair Dismissal Protection to Overseas Workers

A recent House of Lords judgment has extended the scope of British unfair dismissal protection to staff working abroad by deciding that Lawson, Botham and Crofts (see below) all enjoy unfair dismissal protection in Great Britain despite their differing circumstances.

Serco Ltd v Lawson - Mr Lawson, British and ordinarily domiciled in Great Britain worked for Serco Limited (an English company with a head office in England) on Ascension Island in the South Atlantic. Recruited from England, he only ever worked for Serco on Ascension Island.

Botham v Ministry of Defence - Mr Botham was a civilian employee of the MoD on various bases in Germany. He was treated as being resident in Great Britain for various purposes, including taxation.

Crofts v Veta Ltd - Mr Crofts, a pilot based at Heathrow and living in Great Britain, flew for Veta, which was owned by Cathay Pacific Airways Limited - both Hong Kong companies.

The Lords decided that an employee enjoys unfair dismissal protection in Great Britain if their employment is deemed to be in Great Britain and considered the following:

Working in Great Britain

The primary aspect to consider is whether the employee was working in Great Britain at the time of dismissal or merely on a casual visit when they were dismissed.

The terms of their employment contract and the historical relationship between employee and employer will also be relevant to the decision.

Peripatetic (roaming) employees

Where employees carry out their work in a number of different locations (eg. airline pilots) it is important to look at where they were based under both the terms of their contract and in practice.

A peripatetic employee is held to be able to rely on the unfair dismissal legislation if he is based in Great Britain.

Having taken into account a number of factors, including the "basings policy" of Mr Crofts' employer, it was found that the centre of his operations was, "quite manifestly, London".

Expatriate employees

The question of expatriate employees was then considered. Two examples were given of the types of cases in which such an individual could bring a claim of unfair dismissal in a British employment tribunal.

First, where the employee is posted abroad to work for a business conducted in Britain, and secondly, where the employee works in a "political or social British enclave abroad". Mr Botham and Mr Lawson were both deemed to fall within the latter category.

The decision made by the Lords means that staff who do all their work abroad may enjoy unfair dismissal protection if they are, in practice, based in Britain, or if they are posted abroad for the purposes of their employer's British business.

However, the position may be different if such employees are working for a business conducted in the foreign country with British owners, or a separate branch of a British business. Unfair dismissal protection only applies to employees in the strict sense. It does not cover 'workers'.

The broad general principles set out leave a great deal of scope for employees based abroad to bring employment tribunal proceedings in Britain and the Lords have acknowledged that their decision may mean that some employees are now able to bring claims in Great Britain and elsewhere in respect of the same employment. However, they will not be able to recover compensation in Great Britain for the same losses twice.