A broad connection

Dolphin Drilling Personnel Pte Ltd (DDPPL) v Winks and Dolphin Drilling Ltd (DDL)

Employees who work abroad may have the right to claim unfair dismissal under the principles set out by the House of Lords in Lawson v Serco Ltd. In Dolphin Drilling Personnel Pte Ltd (DDPPL) v Winks and Dolphin Drilling Ltd (DDL) the Employment Appeal Tribunal (EAT) said, applying Lawson, that the place of work is usually decisive in establishing jurisdiction and that it is only in exceptional circumstances that employees who work wholly abroad will be able to do so.

Basic facts

Mr Winks, a British citizen, was employed by DDPPL from May 2004 as a storeman on an oil rig, first in the Gulf of Mexico and then off the coast of Nigeria.

DDPPL - which provided crews for oil rigs for companies all over the world - was registered in Singapore and had its office there. The rig on which Mr Winks worked was registered in Singapore but was managed and operated by DDL, a UK registered company.

He was paid in sterling out of which UK tax was deducted. All his training took place in Aberdeen and his medical examinations and certification were conducted in the UK. His contract with DDPPL provided for the application of English law, and the disciplinary process which ended in his dismissal also took place in the UK.

Mr Winks claimed unfair dismissal, arguing that he worked for DDL, not DDPPL, and although he worked abroad the whole time, the tribunal could still hear his complaint under section 94(1) of the 1996 Employment Rights Act.

Relevant law

Section 94(1) states that "an employee has the right not to be unfairly dismissed by his employer”, but there is no reference in the Act to territorial jurisdiction. The House of Lords then decided in the 2006 case of Lawson v Serco that Parliament must have intended to put some geographical limitation to the provision.

It ruled that employees could only claim unfair dismissal if they were “employed in Great Britain”. That would include “peripatetic” employees based in Great Britain and, in some cases, expatriate employees who work abroad for a British employer – although working for a British employer will not of itself be sufficient. Something more is necessary, for example that the employee is working abroad in relation to the business conducted by the employer in the UK, rather than in relation to the business conducted by the employer abroad.

Tribunal decision

The tribunal decided that Mr Winks was employed by DDDPL and that it had jurisdiction to hear his claim because there was a “substantial connection” between Great Britain and Mr Winks’ employment. It relied in particular on the fact that his work “was carried out in the furtherance of the British business operations of DDL, a British company”.

EAT decision

But the EAT disagreed, saying that although the tribunal had relied on the right case (Serco), it had applied the wrong test (substantial connection). Instead, it should have started “its considerations by recognising that the general rule is that the place of employment is decisive”.

It went on to explain that if an employee falls into the category of a peripatetic or ex-patriate employee as here (in themselves exceptions to the general rule), it is only then that the test of “substantial connection” is relevant. In other words, it is part of a subset of a rule, not as a free standing test.

"Thus, it is plain that...if an employee does not ordinarily work in Great Britain or cannot be regarded as doing so because he has his base in Great Britain, then it is only in exceptional circumstances that there will be jurisdiction and that the character of those circumstances must be that he is recruited in Britain by an employer who is British for the purposes of furthering, by working abroad, the British business of that employer, not business activities which are carried on by the British business abroad. Even less can it be the case that jurisdiction will arise where the employee whilst employed by a British employer is not working abroad for that employer but is actually working for the business of another foreign employer..."

It therefore allowed the appeal.