Duncombe and others v Secretary of State for Children, Schools and Families

Employment Rights Act 1996 section 94(1) can exceptionally protect an employee who works abroad where the employment has overwhelmingly stronger connections with Great Britain and British employment law than with any other legal system. The examples in Lawson v Serco Ltd are illustrations, not a closed category.

The assessment depends on the whole employment relationship. Material factors include a British Government employer, an English-law contract, work in an international enclave with no meaningful connection to the host state's employment law, and the governmental purpose for which the employee was posted. Those factors distinguish locally recruited labour employed under local law.

The respondents were teachers employed by the Secretary of State to work in European Schools outside Great Britain. The Supreme Court had already allowed the Secretary of State's appeal concerning the fixed-term-employment issue in [2011] UKSC 14. It reserved judgment on the teachers' cross-appeal concerning unfair-dismissal protection.

The Employment Tribunal had held that the teachers did not fall within the overseas examples identified in Lawson v Serco Ltd. The Court of Appeal upheld that conclusion in [2009] EWCA Civ 1355. The central issue was whether section 94(1) of the Employment Rights Act 1996 applied to their employment abroad.

1. The cross-appeal was allowed. The teachers' employment was within section 94(1) of the Employment Rights Act 1996, and the case was remitted to the Employment Tribunal.

2. Per the judgment of the Court, the territorial reach of section 94(1) is a question of law governed by the principle in Lawson v Serco Ltd, [2006] UKHL 3. The normal case is an employee working in Great Britain when dismissed; a peripatetic employee based there is also covered. An employee working or based abroad is covered only exceptionally, where the employment has overwhelmingly stronger connections with Great Britain and British employment law than with the country of work or any other system of law.

3. The specific examples in Lawson did not exhaust the principle. The teachers' case was another exceptional example. Their employer was the United Kingdom Government, a necessary and especially close British connection. Their contracts were governed by English law, which informed the parties' reasonable expectations as to employment protection.

4. The teachers worked in international enclaves governed by agreements between participating states. Their employment had no particular connection with the law of the states where the schools happened to be located, and they did not pay local taxes. They had been posted to fulfil commitments undertaken by the British Government. It would also be anomalous for a teacher in a European School in England to receive protection denied to a teacher employed on the same basis in an overseas European School.

5. Those factors distinguished locally engaged labour, exemplified by Bryant v Foreign and Commonwealth Office. Such employees work under local labour law, pay local taxes, and can look to the protection of the system in the country where they work. Extending protection on these special facts neither materially enlarged the exceptional category nor offended international comity. The Ministry of Defence's application for permission to appeal in Ministry of Defence v Wallis and Grocott was dismissed.

• United Kingdom Supreme Court: The teachers' cross-appeal was allowed. The case was returned to the Employment Tribunal. The Secretary of State's separate appeal concerning the fixed-term issue had already been allowed in [2011] UKSC 14.

• Court of Appeal: In [2009] EWCA Civ 1355, the Court of Appeal upheld the Employment Tribunal's conclusion that the teachers were outside section 94(1) of the Employment Rights Act 1996.

• Employment Tribunal: It held that the teachers did not fall within the overseas examples identified in Lawson v Serco Ltd.