Territorial jurisdiction test does not require comparison

CreditSights Limited is a UK subsidiary of an American corporation. The Claimant worked for CreditSights as a sales person based in London with clients worldwide. When the US holding company opened an office in Dubai, the Claimant moved there and relocated his clients to other UK based employees. Discussions then took place regarding the Claimant relocating to Singapore but this did not happen and the Dubai office eventually closed, whereupon the Claimant was dismissed. He brought claims of unfair dismissal and breach of the right to be accompanied.

In the first instance proceedings, the Employment Judge considered that the Tribunal did not have jurisdiction to hear the claims on the basis that the Claimant did not have sufficiently strong connections with Great Britain and British employment law to justify jurisdiction under the test in Lawson v Serco Limited. The Tribunal considered that the Claimant had severed his ties with the UK when he moved to Dubai and was only still on the UK company’s pay roll out of convenience. Once he left the UK he had no further connection in practical terms with the UK company. In overturning the decision, the EAT was of the view that the Employment Judge had failed to compare the strength of the Claimant’s connections with Great Britain and British employment law with the strength of his connections in Dubai.

This was the basis on which the Court of Appeal overturned the EAT decision – namely that no such comparison test needs to undertaken. It said that the starting point is that an employee who is based abroad at the time of the dismissal would not come within UK jurisdiction unless he can show that he has much stronger connections with UK employment law than any other system of law. There is no requirement to undertake a comparative exercise of the respective jurisdictions to establish whether or not the Claimant could bring a claim in the UK. The only purpose of the exercise is to establish whether the Claimant is justified in utilising one of the limited exceptions to the lack of jurisdiction to bring an unfair dismissal claim – and in this situation, the Court of Appeal held that he did not.

This legal update is provided for general information purposes only and should not be applied to specific circumstances without prior consultation with us.

For further details on any of the issues covered in this update please contact Gemma Ospedale, Partner in Employment on 020 7583 2222.