The Kingdom of Spain v L Lorenzo

The Employment Appeal Tribunal considered whether diplomatic immunity or State immunity barred race discrimination and harassment claims brought under the Equality Act 2010 by a locally employed member of staff at the Spanish Embassy. The tribunal below had held that diplomatic immunity did not prevent claims brought against the State because Article 31 of the Vienna Convention confers immunity on the diplomatic agent rather than the sending State, and that section 4(2)(a) of the State Immunity Act 1978 should be disapplied in respect of claims under the Equality Act in the light of Benkharbouche v Secretary of State for Foreign and Commonwealth Affairs [2017] UKSC 62 and EU law.

The EAT affirmed the tribunal’s principal conclusions. It held that Article 31 immunity attaches to the diplomatic agent, not to the State, and that the tribunal should (but in the event need not to alter its decision) have had regard to the pleaded acts when considering whether those acts were exercises of sovereign authority under the State Immunity Act regime. Applying Benkharbouche, the EAT held that section 4(2)(a) of the State Immunity Act 1978 was not justified by binding customary international law and was properly disapplied in respect of the Equality Act claims. The appellant’s other grounds of appeal failed and, although one ground was allowed as a matter of principle, it made no difference to the outcome and the tribunal’s judgment stood.

This was an appeal by the Kingdom of Spain against a preliminary judgment of the London Central Employment Tribunal which (a) dismissed the claimant’s statutory employment claims under the Employment Rights Act 1996 and Employment Act 2002 as barred by State immunity, and (b) allowed claims of direct race discrimination and harassment under the Equality Act 2010 to proceed against the Kingdom of Spain, disapplying section 4(2)(a) of the State Immunity Act 1978 in respect of those Equality Act claims.

Background and parties:

• The claimant was a bilingual employee at the Spanish Embassy in London, holding dual British and Spanish nationality and having performed administrative, secretarial and some protocol duties.
• The respondent (appellant on this appeal) was the Kingdom of Spain (the Embassy being treated as an emanation of the State in domestic law).

Nature of the proceedings and relief sought: The claimant sought to bring employment-related claims including unfair dismissal/statutory employment claims and claims of direct race discrimination and harassment under the Equality Act 2010. The preliminary hearing determined jurisdictional issues: whether diplomatic immunity (Vienna Convention Article 31) or State immunity (State Immunity Act 1978) barred the proceedings.

Issues framed:

1. Whether the State, sued as employer, can rely upon diplomatic immunity that, by its terms, attaches to a diplomatic agent (grounds 2 and 3).
2. If State immunity applies, how should the distinction between sovereign (jure imperii) and non-sovereign (jure gestionis) acts be applied to the pleaded discriminatory acts (ground 4).
3. Whether the tribunal’s factual finding that the claimant’s employment and the acts complained of were not inherently sovereign was open on the evidence (ground 5).
4. Whether section 4(2)(a) of the State Immunity Act 1978 should be disapplied in respect of the Equality Act claims (ground 6), applying principles in Benkharbouche.

Court’s reasoning:

• Diplomatic immunity: The EAT held that Article 31 of the Vienna Convention confers immunity on the diplomatic agent (as defined in Article 1) and not on the sending State as respondent; the State cannot invoke Article 31 for itself. Authorities and treaty text were analysed to show the distinction between immunities attaching to individuals and those attaching to states.
• State immunity and sovereign versus non-sovereign acts: The EAT reviewed Benkharbouche and Lord Sumption’s analysis that State immunity under the restrictive doctrine applies to sovereign acts but not to acts of a private law character, and that the relevant inquiry ordinarily depends on the functions performed by the employee and the context of the acts. The tribunal should have considered the pleaded discriminatory acts in deciding whether they were sovereign acts, but the EAT concluded that the pleaded acts were not inherently sovereign and that the tribunal’s conclusion on the facts was not perverse.
• Disapplication of section 4(2)(a) SIA: Applying Benkharbouche, the EAT concluded that section 4(2)(a) (which, in its pre-2023 form, extended immunity for claims by a State’s own nationals irrespective of the sovereign character of the act) was not justified by binding customary international law. Consequently it was properly disapplied in respect of claims deriving from EU law (Article 47 of the Charter) and could not be relied upon to bar the Equality Act claims in this case.

Disposition: The EAT dismissed the appellant’s grounds of appeal except that one ground (ground 4) was allowed in principle but without effect on the outcome; the tribunal’s decision to permit the Equality Act claims to proceed against the Kingdom of Spain was upheld.

The appeal was dismissed. The EAT held that Article 31 of the Vienna Convention confers immunity on a diplomatic agent and not on the sending State as respondent, so the State could not invoke diplomatic-agent immunity for itself. The tribunal should have considered the pleaded discriminatory acts when determining whether those acts were exercises of sovereign authority, but its factual conclusion that the acts were not inherently sovereign was not perverse. Applying Benkharbouche, section 4(2)(a) of the State Immunity Act 1978 was not justified by binding customary international law and was properly disapplied in relation to the Equality Act claims; consequently the tribunal retained jurisdiction and its judgment stood.

This is an appeal to the Employment Appeal Tribunal from a preliminary judgment of the London Central Employment Tribunal (Employment Judge Segal KC) dated 16 June 2021. The EAT heard the appeal on 7 and 8 February 2023 and handed down judgment on 12 December 2023. The tribunal below had allowed the claimant’s Equality Act claims to proceed and disapplied section 4(2)(a) of the State Immunity Act 1978 in respect of those claims; the EAT largely dismissed the State’s appeal against that determination.