Hughes v Alan Dick & Co Ltd.

For unfair dismissal claims under Employment Rights Act 1996, territorial scope depends on whether the employment has a sufficiently strong connection with Great Britain and British employment law. Employment abroad is the starting point, and the place of employment will usually be decisive. Exceptional cases may arise where an employee is posted abroad to work for a business conducted in Britain, or works within a British political or social enclave abroad. Recruitment in Britain, an English employer, payment into a UK bank account, dismissal from the UK, and UK-based insurance are not necessarily sufficient. The connecting factors must be assessed in context. The absence of an equivalent remedy under foreign law is not relevant.

John Hughes was employed by the English respondent but worked throughout his employment in Port Harcourt, Nigeria, in a business substantially operated there by the respondent’s Nigerian subsidiary. His contract was made in the United Kingdom, he was recruited there, paid into a UK bank account, covered by UK-based health insurance, and dismissed by a letter sent from the respondent’s UK head office.

The Employment Tribunal decided as a preliminary issue that section 94 of the Employment Rights Act 1996 did not apply territorially and that Mr Hughes could not bring an unfair dismissal claim. The Employment Appeal Tribunal dismissed his appeal. On the oral renewal of his application for permission to appeal, the issue was whether the Employment Tribunal had misapplied the territorial principles stated in Lawson v Serco [2006] UKHL 3.

1. The application for permission to appeal was refused. The Employment Tribunal had applied the correct legal test and had not erred in law.
2. Under section 94(1) of the Employment Rights Act 1996, territorial coverage depends on the strength of the employment’s connection with Great Britain and British employment law. An employee working and based abroad will ordinarily fall outside the legislation.
3. Lawson v Serco [2006] UKHL 3 identified exceptional categories, including an employee posted abroad to work for a business conducted in Britain and an employee working within a British political or social enclave abroad. Other cases may exist, but they require equally strong connections.
4. The relevant connecting factors must be weighed in context. The English employer, UK recruitment, contract formation in the United Kingdom, payment into a UK bank account, UK-based insurance, and dismissal from the UK were not compelling. They were substantially weaker than the connections in the expatriate cases considered in Lawson v Serco. The claimant’s work was carried out in Nigeria in a business operated there, principally by the Nigerian subsidiary.
5. The absence of an equivalent remedy under Nigerian law, said to result from non-ratification, adoption or implementation of the ILO Convention, was irrelevant. Forum non conveniens was also irrelevant, and the proposed equitable jurisdiction point was abandoned. No point of general importance required clarification.

• Court of Appeal (Civil Division): on 19 February 2009, the oral renewal of the application for permission to appeal was refused.
• Employment Appeal Tribunal: the claimant’s appeal was dismissed on 3 December 2008.
• Employment Tribunal: on 30 May 2008, the preliminary issue concerning the territorial application of section 94 of the Employment Rights Act 1996 was decided against the claimant.