Crofts & Ors v Cathay Pacific Airways Ltd & Ors

The territorial scope of the unfair-dismissal right is governed by whether the employment is in Great Britain. The inquiry requires a flexible assessment of all the circumstances, with emphasis on the employment itself. A contractual base is not a freestanding legal test, but may be powerful evidence where work is inherently mobile and international. Training, pay, management and governing-law connections abroad remain relevant, but are not conclusive. Transitory passage through Great Britain is insufficient. Where an Employment Tribunal has jurisdiction over unfair-dismissal claims, that jurisdiction may make it the appropriate forum for parallel contractual claims.

International airline pilots employed by Hong Kong companies were dismissed and brought claims before an Employment Tribunal for unfair dismissal and breach of contract. Their contracts were governed by Hong Kong law, but the Veta pilots were based in London and began and ended their tours there. The Employment Tribunal found jurisdiction for the Veta pilots’ claims but not for the CPA pilots or Mr Parrock. The Employment Appeal Tribunal applied Lawson v Serco Ltd [2004] EWCA Civ 12, treated the Veta case as borderline and remitted it. The central issues were whether the Veta pilots’ employment was in Great Britain and whether the contractual claims should proceed in England.

Majority decision: Lord Justice Waller and Lord Justice Maurice Kay allowed the Veta pilots’ appeal, dismissed Veta’s cross-appeal, and remitted the Veta pilots’ unfair-dismissal and breach-of-contract claims to the Employment Tribunal. The CPA pilots’ and Mr Parrock’s appeals were dismissed.

1. Territorial scope. The controlling test was whether the employment was in Great Britain under Lawson v Serco Ltd [2004] EWCA Civ 12. The test required an assessment of all the circumstances of the employment. The court rejected an inflexible base test, but held that the contractual base could throw clear light on the location of inherently mobile and international employment.
2. Application to the pilots. The Veta pilots were allocated English bases indefinitely. Their tours normally began and ended at Heathrow, and the centre of their operations was London. Those matters outweighed the countervailing facts that training, payment, management and other employment administration occurred in Hong Kong. The Veta pilots were therefore employed in Great Britain for the purposes of section 94(1) of the Employment Rights Act 1996. The CPA pilots and Mr Parrock were not.
3. Contract claims. The court considered the jurisdictional provisions concerning service within and outside the jurisdiction. The distinction between jurisdiction and the proper place for service abroad was treated as arid on the facts. The majority held that, because the Veta pilots’ unfair-dismissal claims remained available in England, the Employment Tribunal was also the appropriate forum for their parallel contractual claims. Those claims were remitted together.
4. Dissent. Lord Phillips MR would have applied Serco strictly and concluded that section 94(1) could not apply to international airline pilots. He would have stayed all contractual claims on forum non conveniens grounds. The majority rejected that interpretation.

1. Court of Appeal (Civil Division): The majority allowed the Veta pilots’ appeal, dismissed Veta’s cross-appeal, remitted the Veta pilots’ Employment Rights Act and contractual claims, and dismissed the CPA pilots’ and Mr Parrock’s appeals.
2. Employment Appeal Tribunal: In a judgment delivered on 24 June 2004, the EAT dismissed the appeals concerning contractual jurisdiction and treated the Veta pilots’ statutory claims as borderline under Serco, remitting them to a fresh Employment Tribunal.
3. Employment Tribunal: The Tribunal found jurisdiction for the Veta pilots’ statutory claims and contractual claims, but not for the CPA pilots’ or Mr Parrock’s statutory claims, and stayed the CPA pilots’ contractual claims.