Employment Judge LevertonMr Tim Goodwin (instructed by Counsel) for claimantMr Matthew Rudd (instructed by Counsel) for respondentDate 4 July 2025
JUDGMENT
The employment tribunal is the appropriate forum to determine the Claimant’s contractual claims brought under the Employment Tribunals Extension of Jurisdiction (England and Wales) Order 1994 (SI 1994/1623). The Claimant’s claims for unfair dismissal, redundancy pay and unlawful deductions from wages under the Employment Rights Act 1996, and for holiday pay under the Working Time Regulations 1998 (SI 1998/1833), fall within the territorial scope of those provisions.
REASONS
[1]By a claim form presented on 27 January 2023, the Claimant issued claims for unfair dismissal, unlawful deductions from wages, notice pay, holiday pay, redundancy pay and various sums said to be due under his contract. While some of his claims are contractual, others potentially relate to statutory provisions contained in the Employment Rights Act 1996 (unfair dismissal, redundancy pay and unlawful deductions) and the Working Time Regulations 1998 (SI 1998/1833) (statutory holiday pay).[2]This preliminary hearing was listed to determine whether the employment tribunal has jurisdiction to consider the various claims. An email from the tribunal dated 7 June 2023 attaching the notice of hearing stated that the case had been listed for a one-day preliminary hearing by video to determine an application to strike out the claims on the basis that the tribunal did not have jurisdiction. Clarification was sought on the basis that the attached notice of hearing suggested that it would in fact be a substantive hearing to determine liability and remedy. In an email dated 4 August 2023, the tribunal confirmed that the purpose of the hearing was as stated in the email of 7 June.[3]At the hearing today, the Claimant’s representative made the point that there had been no application for the claims to be struck out under rule 37 of the Employment Tribunals Rules of Procedure 2013. He also took issue with the use of the term ‘jurisdiction’ in the tribunal’s correspondence, arguing that the question of jurisdiction is limited to the forum in which the claim is to be determined and does not extend to the applicable law relating to the employment contract, nor to the territorial scope of a domestic statute such as the Employment Rights Act 1996 (ERA). He argued that these matters would need to be determined by the tribunal at a further preliminary hearing or as part of the substantive hearing, and that they could not be considered by me today because that was not the purpose for which the preliminary hearing had been listed.[4]I discussed this matter with the representatives at the outset of the hearing. While I accept that the applicable law of the Claimant’s contract is not a jurisdictional issue and will have to be addressed at the substantive hearing, I do not accept the suggestion that I cannot consider the territorial scope of the ERA or the Working Time Regulations 1998 (WTR). It would make little sense for the tribunal to have listed a preliminary hearing solely to consider the appropriate forum for the claims, which appears uncontroversial, nor would it accord with the overriding objective of dealing with cases fairly and justly for me to proceed on that limited basis when it is apparent that the real dispute between the parties concerns territorial scope.[5]The tribunal used the terms ‘strike out’ and ‘jurisdiction’ loosely in correspondence, but in my view the notice of hearing dated 7 June 2023 contained an adequate description of the preliminary issues that would be decided today. Both Counsel attended the hearing fully prepared to address the territorial reach of the ERA and had dealt with it in their skeleton arguments. They also addressed me in their oral submissions as to the scope of the WTR. The witness statements dealt with factual matters relevant to territorial reach. This reinforces my conclusion that there can have been no reasonable doubt about the purpose of today’s hearing.[6]This is not, and was never intended to be, a hearing to consider strike-out under rule 37, which would have required consideration of whether the claims have no reasonable prospect of success. The question for me to decide is whether any of the claims should be dismissed, either because this is not the appropriate forum in which to determine them or because they do not fall within the territorial scope of the domestic legislation. The hearing proceeded on that basis. Evidence and procedure[7]The hearing took place remotely by CVP. It started around 30 minutes late because the Claimant and his solicitor were experiencing technical issues that needed to be resolved.[8]The Claimant was represented by Mr Goodwin and the Respondent was represented by Mr Rudd, both of Counsel. I had before me a 173-page joint electronic bundle of documents. Where I consider it may be helpful, I have included page references to the bundle in square brackets below.[9]The Claimant and Mr Jaime Marina, one of the Respondent’s two directors, provided witness statements and gave oral evidence. The Claimant had travelled from Denmark to Mr Goodwin’s chambers in London to participate in the video hearing and this avoided any difficulties that might otherwise have arisen in connection with the giving of evidence from abroad. I heard closing submissions from both Counsel. Skeleton arguments were provided (Mr Goodwin having been assisted in this task by Ms Jessica Franklin), and I am grateful for the clarity of the submissions. I will not rehearse all the submissions in this judgment, but I have taken them fully into account in reaching my decision.
Findings of fact
[10]I find the following facts on the balance of probabilities, based on the evidence I heard and the documents before me.[11]The Respondent is a company incorporated in the United Kingdom. It is a design and engineering company that makes 3D products for the architectural, marine, industrial, automotive and energy sectors. Its registered office is in Hampshire and it operates out of an industrial unit in Poole, where its products are manufactured. It is a subsidiary of an Australian company.[12]The Claimant is a Danish national who at all material times lived in Denmark. He was employed by the Respondent as a sales manager from 22 November 2018 to 19 August 2022. He was introduced to the Respondent through a mutual business contact, who put him in touch with Mr Marina. The Claimant telephoned Mr Marina from Denmark on 21 August 2018 and there was a brief discussion about the prospects of working together. The Claimant and Mr Marina agreed to continue their discussion the following month, when Mr Marina would be in Copenhagen on business.[13]On 20 September 2018, the Claimant travelled 2.5 hours from his home in Faaborg to meet Mr Marina at a hotel in Copenhagen. A discussion took place, lasting around two hours. On 23 October 2018, the Claimant travelled to Poole to continue the discussions. He had meetings with Mr Marina and other employees of the Respondent at the company’s manufacturing facility in Poole. Their discussions centred around how the Claimant could help the Respondent gain a foothold in the wind turbine industry.[14]Mr Marina followed up by emailing the Claimant on 30 October 2018 [145]. He gave more details about the Respondent’s business and expressed an interest in the Claimant ‘representing MouldCAM in the wind market’. The Claimant responded by email on 1 November setting out a proposal as to his remuneration package and working hours [147]. He proposed that he would work two weeks per month for the Respondent on a salary of EUR 3,600 with 5% commission on sales, travelling to Poole for two to four days a month. Mr Marina replied by email on 11 November with a counter offer [42]. He proposed a salary of EUR 2,860 per month and commission of 3.75% on sales. The proposed hours of work were 80 hours per month but Mr Marina added: ‘This is somewhat up to you. You may not need these hours, and we don’t mind that if the revenue targets are being met.’[15]The discussions continued, and on 21 November Mr Marina sent the Claimant a further email enclosing a draft employment contract [148]. The Claimant travelled to Poole again on 27 November 2018, and the contract, which gave a start date of 22 November, was signed by the Claimant and Mr Marina in Poole on 29 November [115]. The contract began: ‘This document… sets out the main terms of your employment in accordance with the Employment Rights Act 1996.’ There was also a reference to the Data Protection Act 1998 (now repealed). The contract provided for a monthly salary of £2,500 and 3.75% commission on gross sales ‘paid at time of job deposit’. The Claimant’s normal hours of work were 80 hours per month but ‘[t]he allocation of those hours is entirely up to the agreement between yourself and the company’.[16]The Claimant’s ‘usual place of work’ was stated in the contract to be his home address in Faaborg, Denmark. The contract went on to provide: ‘Due to the nature of your employment you are required to travel to, and work at, any location as directed to meet the needs of the Company.’ The Claimant was entitled to a business mileage allowance, reimbursement of reasonable expenses, and contractual sick pay. After completion of his probation period, he was required to give four weeks’ notice of termination. The required notice from the Respondent was also set out; it reflected the statutory minimum periods of notice under section 86 ERA. It was further stated that the Claimant’s holiday year began on 1 January and that the company recognised eight UK public holidays. However, the Claimant’s annual holiday entitlement was not specified. The contract indicated that the ‘details of holiday duration and pay’ were to be agreed and included as an addendum to the main contract, but there was no evidence that any such agreement was reached. The contract referred the Claimant to the company handbook for details of the Respondent’s disciplinary procedure, code of conduct and grievance procedure.[17]The Claimant’s main responsibility was to make sales to the wind energy industry on behalf of the Respondent. His focus was on sales in Germany, the Netherlands and Denmark. The Respondent had no physical presence in any of those countries and it wanted to gain a foothold there. The Claimant conducted much of his business remotely from Denmark, travelling to Germany and the Netherlands five or six times a year to obtain orders for the Respondent. When he travelled to those countries, the location of his home in Faaborg meant that he could often complete the return journey in one day. He was free to visit any business he regarded as a potential customer; he had autonomy in that respect. The Claimant did not visit the UK as often as he had envisaged; he travelled there on only three or four occasions during the entire period of his employment (nearly four years). He nevertheless regarded himself as an extension of the UK team, selling products that would be manufactured in Poole.[18]During the period of the Claimant’s employment, human resources and administrative matters, such as accountancy, were undertaken from the Respondent’s office in Poole. The staff handbook [44] and the Claimant’s payslips [138] followed the standard format that would be expected in a UK business. The Claimant’s salary was paid into his Danish bank account in GBP and automatically converted on receipt into Danish krone. The Respondent did not deduct UK tax or national insurance contributions, and the Claimant was responsible for his own tax arrangements in Denmark.[19]The Claimant stated in evidence that he communicated with Mr Marina several times a day, usually via WhatsApp. Mr Marina said that his contact with the Claimant was less frequent, more like three or four times a week. I consider that the reality is likely to fall somewhere in between these two versions. I accept Mr Marina’s evidence that there was not a continuous stream of work, and I consider it likely that there were periods when the Claimant and Mr Marina communicated several times a day, and other periods when communication happened several times a week. On either basis, their communications could be described as frequent.[20]Mr Marina was initially based in Poole, but he moved to Australia in December 2019. He was in Monaco in early 2020, and then he lived back in Australia from April 2020 until the Australian border re-opened in 2022 after the Covid pandemic. From May 2022 to February 2023, he was in the USA, and then he returned to the UK.[21]Mr Marina was not the Claimant’s sole point of contact within the Respondent’s business. The Claimant also had regular contact with Scott King, the Respondent’s production manager in Poole. There were ongoing issues that required frequent contact with other colleagues based in Poole. The Claimant describes such contact as taking place multiple times a day, and I accept that there were periods throughout his employment when this happened.[22]In an email dated 21 December 2019, Mr Marina raised a concern with the Claimant [155]. He was unhappy because he perceived the Claimant to be stepping outside his sales remit and becoming involved with production, contracts, schedules and customer contact. In that email, Mr Marina stated: ‘The business of Mouldcam is to be done from Poole and nowhere else. All decisions regarding finances, resources, capacity, and contracts is [sic] to have the final decision taken by the office in Poole. You are more than welcome to be part of that, but under no circumstances should you make statements to any customer without the written approval from Poole. Mouldcam must be in complete charge of its position... If you are contacted by any representative of any customer, you are to discuss only sales matters. If any other subject comes up about accounts, resources, schedules etc, you must politely state that the best contact is the Poole office. No exceptions to this.’[23]On 29 July 2022, Michael Kenney-Herbert, a UK-based director of the Respondent, emailed the Claimant a letter terminating his employment with effect from 19 August on the ground of his sales performance, which was said to be unsatisfactory [121]. The decision to dismiss the Claimant had been taken in the UK and a number of people had been involved, including Mr Marina, Mr Kenney-Herbert and Peter Shepherd, the Respondent’s operations manager. The Claimant responded by email on 4 August 2022 [123], stating that he was a member of a union, Business Danmark, and that because his workplace was ‘mostly in Denmark’, the Danish law on termination of contracts applied. On 17 August, the Claimant sent a further email [125] referring to the Danish law on holiday pay.[24]Mr Kenney-Herbert’s response to the Claimant’s emails, dated 18 August [168-169], stated: ‘As you have argued many times you see yourself as an employee of MCL and the agreement you signed between you and MCL clearly states the jurisdiction is the UK… UK contract, UK employer and as said before where you chose to live is up to you not MCL… UK is the jurisdiction for your employment. Given the global nature of the wind industry we agreed where you chose to live is up to you, I assume that you have met all the tax obligations in whichever countries you have lived/worked in... The contract you signed is UK and we have acted according to it.’[25]After the termination of the contract, the Claimant’s union entered into email correspondence with Mr Kenney-Herbert on the Claimant’s behalf. On 2 November 2022, Mr Kenney-Herbert emailed Business Danmark, asking it to ‘outline what role Business Danmark takes in UK employment issues’. The union replied as follows: ‘Claus has carried out his work from Denmark and therefore his employment is covered by Danish law and that is why we have entered into the case’ [134].[26]The Respondent cooperated with the Acas early conciliation process and advised the Claimant to do likewise [173]. In his tribunal claim form dated 27 January 2023, the Claimant continued to assert that his notice entitlement was governed by Danish law. Similarly, the calculation of his holiday pay set out in an attachment to the claim form is referable to his entitlement under Danish law [18]. Legal framework Appropriate forum[27]The contractual jurisdiction of employment tribunals is governed by section 3 of the Employment Tribunals Act 1996 (ETA) and the Employment Tribunals Extension of Jurisdiction (England and Wales) Order 1994 (SI 1994/1623). Under section 3(2) ETA and Article 3 of the 1994 Order, for an employment tribunal to be able to hear a contractual claim brought by an employee, that claim must be one that a court in England and Wales would have jurisdiction to hear and determine. To ascertain this, regard must be had to the rules of international jurisdiction.[28]For claims brought after the end of the UK-EU transition period, the tribunal’s jurisdiction is determined by section 15C of the Civil Jurisdiction and Judgments Act 1982 (‘CJJA 1982’), as amended by the Civil Jurisdiction and Judgments (Amendment) (EU Exit) Regulations 2019 (SI 2019/479). Section 15C(2) CJJA 1982, which applies where the subject matter of proceedings relates to an individual contract of employment, provides: ‘The employer may be sued by the employee –(a) where the employer is domiciled in the United Kingdom, in the courts for the part of the United Kingdom in which the employer is domiciled,(b) in the courts for the place in the United Kingdom where or from where the employee habitually carries out the employee’s work or last did so (regardless of the domicile of the employer), or(c) if the employee does not or did not habitually carry out the employee's work in any one part of the United Kingdom or any one overseas country, in the courts for the place in the United Kingdom where the business which engaged the employee is or was situated (regardless of the domicile of the employer).’[29]Rule 8(2) of the Employment Tribunals Rules of Procedure 2013, contained in Schedule 1 to the Employment Tribunals (Constitution and Rules of Procedure) Regulations 2013/1237, is also relevant. It provides: ‘A claim may be presented in England and Wales if –(a) the respondent, or one of the respondents, resides or carries on business in England and Wales;(b) one or more of the acts or omissions complained of took place in England and Wales;(c) the claim relates to a contract under which the work is or has been performed partly in England and Wales; or(d) the Tribunal has jurisdiction to determine the claim by virtue of a connection with Great Britain and the connection in question is at least partly a connection with England and Wales.’[30]A company ‘resides’ in England and Wales (or Scotland) for these purposes if it is incorporated in England and Wales (or Scotland) or if its central management and control are exercised there. Territorial scope – Employment Rights Act 1996[31]Section 196 ERA, which used to exclude employees who ordinarily worked outside Great Britain from the protection of the Act, was repealed by the Employment Relations Act 1999. The ERA is now silent as to its territorial scope. The general rule that emerges from the case law is that the ERA applies only to employment in Great Britain; exceptionally, however, it can extend to employees working abroad.[32]In Lawson v Serco Ltd and two other cases [2006] ICR 250, HL, Lord Hoffmann identified three categories of employees:(1) in the standard case, the question of territorial scope will depend on whether the employee was working in Great Britain at the time of dismissal;(2) the second category consists of peripatetic employees such as airline pilots who, owing to the nature of their work, do not perform services in one territory, and whose ‘base’ (the place where they start and end assignments) should be treated as their place of employment;(3) the third category consists of expatriate employees working and based abroad, who may in exceptional circumstances be entitled to claim unfair dismissal.[33]Lord Hoffmann gave two examples of circumstances in which an expatriate employee would enjoy unfair dismissal protection. The first was an employee posted abroad by a British employer for the purposes of a business carried on in Great Britain — for example, a foreign correspondent on the staff of a British newspaper. The second was an expatriate employee of a British employer ‘who is operating within what amounts for practical purposes to an extraterritorial British enclave in a foreign country’. There might be other qualifying situations but employees would need to show ‘equally strong connections with Great Britain and British employment law’.[34]Lord Hoffmann considered that the circumstances would have to be unusual for an employee who works and is based abroad to come within the scope of the ERA. He considered it ‘very unlikely’ that someone working abroad would be covered unless he or she was working for an employer based in Great Britain, but that by itself would not be enough. With reference to the facts of Financial Times Ltd v Bishop EAT 0147/03, he opined that an employee selling advertising space in San Francisco for a UK newspaper as part of its business conducted in London would attract the protection of the ERA. By contrast, an employee working for a business conducted by the paper or an associated company in the United States – for example, selling advertising space in the American edition of the paper – would not be protected.[35]While the House of Lords in Lawson did not decide the point, it is generally accepted that the principles set out in that case apply not only to unfair dismissal but to all the other provisions of the ERA.[36]Subsequent case law emphasises that it is not always necessary to slot employees into one of Lord Hoffmann’s three broad categories. In Duncombe v Secretary of State for Children, Schools and Families (No.2) [2011] ICR 1312, SC, Lady Hale stated that, to be covered by the ERA, the employment relationship of an employee who is working or based abroad must have ‘much stronger connections’ both with Great Britain and with British employment law than with any other system of law. In that case, the claimants had been employed as teachers in European Schools abroad by the Department for Children, Schools and Families. Relevant factors indicating a sufficiently strong connection with British employment law were that their employer was the UK Government; their contracts were governed by English law; they were employed in international enclaves governed by international agreements; and it would be anomalous if a teacher who happened to be employed by the British Government to work in the European School in England were to enjoy different protection.[37]In Ravat v Halliburton Manufacturing and Services Ltd [2012] ICR 389, SC, Lord Hope treated the Lawson categories as examples of the application of a general principle: where work is performed outside Great Britain, the connection with Great Britain and British employment law must be sufficiently strong to enable it to be said that Parliament would have regarded it as appropriate for the employment tribunal to deal with the claim. This was reiterated by the Court of Appeal in Bates van Winkelhof v Clyde and Co LLP and anor [2013] ICR 883, CA. Where an employee works and lives wholly abroad, it will be appropriate to ask whether his or her employment relationship has much stronger connections both with Great Britain and with British employment law than with any other system of law – Duncombe v Secretary of State for Children, Schools and Families (No.2) (above).[38]Other cases from which I have derived assistance include Creditsights Ltd v Dhunna [2015] ICR 105, CA; Lodge v Dignity and Choice in Dying and anor [2015] IRLR 184, EAT; and Crew Employment Services Camelot v Gould EAT 0330/19. In the latter case, the EAT considered it almost inevitable that, in assessing whether there is a sufficiently strong connection with the claimed jurisdiction, the tribunal will consider the strength of connection with other jurisdictions to see if the territorial pull is in fact exerted in the opposite direction. Territorial scope – Working Time Regulations 1998[39]The WTR, like the ERA, do not set out the territorial reach of the rights they contain. In Bleuse v MBT Transport Ltd and anor [2008] ICR 488, EAT, a German national employed by a company registered in England, but who lived in Germany and worked solely in mainland Europe, was not entitled to claim unfair dismissal under the ERA. Although he worked for a company based in the UK, he did not operate out of the UK and had virtually no connection with it. Mr Justice Elias took the view that, disregarding questions of European law, there would be no reason to hold that the territorial reach of rights under the WTR was any different from the ERA.[40]However, Elias J in Bleuse considered it relevant that the WTR give effect to directly effective rights contained in the EU Working Time Directive (No.2003/88). Domestic courts must, if at all possible, construe the WTR so as to give effect to those rights in cases where English law was the proper law of the contract or where English mandatory rules applied under the Rome I Regulation. Otherwise, the European principle of effectiveness would not be satisfied in that there would be no effective remedy for a breach of the EU right.[41]In Ministry of Defence v Wallis and anor [2011] ICR 617, CA, Lord Justice Elias made it clear that ‘once a claimant is seeking to enforce a directly effective EU right, it matters not which national law is applicable to the right in question, provided at least that it is the law of a Member State… [O]nce the British court is properly seised of the issue, it would be obliged to give effect to the directly effective right one way or another, irrespective of which body of national rules applies.’[42]The UK’s departure from the EU took effect on 31 December 2020 (‘IP completion day’). Under the European Union (Withdrawal) Act 2018 (EU(W)A), EU-derived domestic legislation in force on IP completion day remains in force. EU law as it stood on IP completion day has essentially been incorporated into domestic law as ‘retained EU law’, and the case law of the European Court of Justice as it stood on IP completion day has likewise been incorporated as ‘retained EU case law’. Furthermore, the doctrines of direct and indirect effect and the supremacy of EU law have been preserved, so that claimants in the employment tribunal can still rely on the direct effect of a Directive (so long as it has been recognised in case law by IP completion day) and can still seek to have domestic legislation interpreted, so far as is possible, so that it conforms with retained EU law.[43]However, para 3 of Schedule 1 to the EU(W)A provides that no new claim may be brought based on failure to comply with any of the general principles of EU law, and no court or tribunal may disapply or quash any enactment or decide that any conduct is unlawful because it is incompatible with any of the general principles of EU law. Thus, in so far as the reasoning in Bleuse relies on the general EU law principle of effectiveness, it might be argued that it has not been preserved post-Brexit – although this is subject to transitional provisions covering cases brought before the end of 2023, and in any event the general principles of EU law continue to inform the interpretation of retained EU law. The scope for bringing a legal challenge based on EU law will be greatly reduced once the Retained EU Law (Revocation and Reform) Act 2023 comes into effect. Discussion and conclusions Appropriate forum[44]There was no dispute about the appropriate forum for the Claimant’s contractual claims. Section 15C(2)(a) CJJA 1982 provides that an employer ‘domiciled in the United Kingdom’ may be sued in the courts for the part of the United Kingdom in which the employer is domiciled. The Respondent is a company registered in the UK, with premises in Poole. It is domiciled in the UK for the purposes of this provision. It also ‘resides or carries on business in England and Wales’ for the purpose of rule 8(2) of the Employment Tribunals Rules of Procedure 2013.[45]The tribunal accordingly has jurisdiction to determine any claim for contractual notice pay brought by the Claimant. It also has jurisdiction in respect of claims for other sums due under the contract, in so far as the Claimant relies on the Extension of Jurisdiction Order as distinct from the provisions of the ERA dealing with unlawful deductions from wages. Territorial scope – Employment Rights Act 1996[46]I turn to the statutory claims for unfair dismissal, redundancy pay and unlawful deductions from wages. When determining the territorial scope of the ERA, the question I must ask is whether the Claimant’s employment has a sufficiently close connection with both Great Britain and British employment law. It is generally accepted that this is a question of law, but my task is to make an evaluative judgement based on the relevant factors. I approach this task by applying the principles derived from the case law summarised above, and not by extrapolating from the facts of decided cases.[47]In his skeleton argument, Mr Rudd suggested that the Claimant was properly to be regarded as a peripatetic employee working in a number of different countries as a salesperson – the second category identified by Lord Hoffmann in Lawson v Serco Ltd. In my view, the evidence does not support the view that the Claimant was a travelling salesperson who spent his working hours on the move. For the majority of his time, he was working from home in Denmark, with occasional business trips within Denmark and to Germany and the Netherlands and, less frequently, to the UK. In my view, his position bears more similarity to that of an expatriate employee, the third category identified in Lawson. It may be helpful to view him in that light, although I am not obliged to place him within one of the three Lawson categories.[48]My starting point is that it is only in exceptional circumstances that an employee in the Claimant’s position will be entitled to claim statutory rights under the ERA, including protection against unfair dismissal and unlawful deductions from wages – see Lord Hoffmann’s judgment in Lawson. It is a question of fact and degree whether the Claimant’s connection with Great Britain was strong enough to place him in that exceptional category. The Supreme Court in Ravat v Halliburton Manufacturing and Services Ltd emphasised that a truly expatriate employee would need to show an especially strong connection with British employment law. There must be not only a stronger connection, but a much stronger connection, both with Great Britain and with British employment law, than with any other legal system.[49]In addition to the guidance in the relevant authorities, I have drawn on the list of factors taken from Harvey on Industrial Relations and Employment Law that Mr Goodwin helpfully set out in his skeleton argument, before stepping back and considering whether the Claimant fell within the exceptional category mentioned in Lawson. Relevant factors in this case include the following:(a) the amount of time, if any, the Claimant spent living and/or working in Great Britain;(b) the Claimant’s place of domicile and nationality;(c) where the Claimant was recruited;(d) in which country the Claimant’s salary and other benefits were paid, and in which currency;(e) in which country the Claimant paid tax;(f) line management structure and administrative support, and where those things were based;(g) the law of the contract, why it was chosen and whether the Claimant had any influence over its choice;(h) any other representations made by the employer about the applicability and protection of British employment law; and(i) the identity of the employer and the extent of its connection with Great Britain. Mr Rudd produced a similar list; additional factors to which he referred included the nature and location of the employer’s business, including whether the employer was a UK company; whether the contract was designed to afford the employee benefits that were peculiar to the foreign or domestic jurisdiction; and whether the employee had a particular connection to the place where the duties were discharged. This is not intended to be an exhaustive list, nor do I regard it as a tick-box exercise, but these factors have assisted me in my evaluative judgement.[50]I return to consider the facts of the case in light of these factors and the principles set out in the case law. The Respondent is a company registered in the UK, with premises in Poole. The claimant is a Danish national. At all material times, he lived and worked in Denmark, and this was reflected in the ‘place of work’ clause in his employment contract. When he travelled to meet customers, his home in Faaborg was his starting point and he returned there afterwards. The Respondent was not concerned with where the Claimant lived. He was entitled to live wherever he wanted, provided he could carry out his duties selling its products to customers in Germany, the Netherlands and Denmark. Nevertheless, I consider that the Claimant’s base in Denmark had some significance to both parties – it meant that he could travel easily to visit potential customers in the countries that the Respondent wished to target. The Claimant’s evidence was that he was often able to travel there and back in one day.[51]The employment contract was signed in person by both parties at the Respondent’s premises in Poole. That was where the deal was sealed, but the recruitment process had been conducted through a combination of telephone and email discussions between the Claimant and Mr Marina, and meetings in Copenhagen and Poole. For that reason, I do not attach too much significance to the place where the contract was signed. The Respondent was established in Poole, although the business was global in the sense that sales were not restricted to the UK. I note that, during negotiations with Mr Marina, the Claimant had given a proposed salary in EUR, but the figure in the final contract was in GBP. The Claimant’s salary was paid in GBP from the Respondent’s UK bank account into his Danish bank account, whereupon it was automatically converted into Danish currency. He did not pay tax or national insurance contributions in the UK; he accounted for tax in Denmark.[52]It turned out that the Claimant spent little time in the UK, but in my view this factor is of less significance than it might have been five or ten years ago, having regard to the prevalence of remote working post-Covid and the various technologies that now enable it. The Claimant had frequent WhatsApp communications with Mr Marina, but I note that the latter was himself living outside the UK for most of the Claimant’s employment. He also had frequent contact with other colleagues in Poole. When he achieved sales abroad, the products would be manufactured in and distributed from Poole.[53]Almost all the Respondent’s management, HR and administrative functions were located in Poole, although I have noted that Mr Marina acted as the Claimant’s line manager at various times while he was living and working outside the UK. The Claimant was also line managed from Poole by Mr King, and he had frequent contact with other staff who were based there. The Respondent had no premises in Denmark and no staff permanently based there, other than the Claimant.[54]The Claimant places particular reliance on the email dated 21 December 2019 from Mr Marina, which began: ‘The business of Mouldcam is to be done from Poole and nowhere else.’ The Claimant says this email demonstrates that control and decision-making power were located in Poole and that he was part of the Poole team, albeit he worked in Denmark. I consider that the purpose of this email was to place limits on the Claimant’s remit as a salesperson. It supports the view that Poole was the decisionmaking hub of the business, from which control over the Respondent’s business activities was asserted, and that the Claimant was regarded as an integral part of the Respondent’s Poole-based operation and as being subject to the Respondent’s normal operating practices.[55]The case law directs me to consider the terms of the Claimant’s employment, even though the applicable law of the contract is not a jurisdictional issue that falls to be determined at this hearing. The Respondent issued the Claimant with its standard UK employment contract. There was no ‘choice of law’ clause in the contract; the Claimant was not given the option of a contract under Danish law, and the parties apparently did not give the matter any thought at the time. The Claimant’s place of work was stated to be his home address in Denmark, but the other terms are all consistent, in my view, with UK employment law applying to the relationship between the parties – in particular, the express references to the ERA and the Data Protection Act 1998 (now repealed), and fact that the notice due to the Claimant under the contract reflects statutory minimum notice periods under the ERA.[56]In a personal sense, the Claimant’s links with Denmark were strong, in that he was a Danish national with a home in Faaborg. In terms of his employment relationship with the Respondent, his connection with Denmark was much weaker. The Claimant paid tax in Denmark and carried out his duties there, but he was engaged by a UK company under a contract drawn up with reference to UK employment law. Even though he worked remotely, he was closely integrated into the Respondent’s administrative, manufacturing and decision-making hub in Poole. He worked closely with the team in Poole, albeit contact was mainly by telephone, email and Teams.[57]The Respondent seeks to rely on post-dismissal communications in which the Claimant and his trade union asserted that Danish law applied to the Claimant’s notice and holiday entitlement. I do not place great significance on that. I accept the Claimant’s account that the reference to Danish law was a matter of expediency: his union did not have expertise in UK employment law and could only offer him assistance if the dispute raised issues of Danish law.[58]Conversely, the Claimant seeks to rely on Mr Kenney-Herbert’s repeated insistence in his communications with the Danish union that this was a UK contract to which UK employment law applied, and to the fact that the Respondent cooperated with the Acas early conciliation process and urged the Claimant to do the same. Again, this took place after termination and in my view is of limited assistance in ascertaining the position at the time of employment. Nevertheless, Mr Kenney-Herbert’s assertion that UK employment law applied is consistent with the terms of the written contract that the parties signed in November 2018.[59]In light of these factors, and with reference to the principles set out in the case law, I have concluded that the Claimant falls within the exceptional category identified by Lord Hoffmann in Lawson v Serco Ltd. I acknowledge that this is a high hurdle to clear, and there are factors that support both sides of the argument. In his closing submissions, Mr Rudd placed emphasis on the fact that the Claimant was a Danish national living and working in Denmark. Nevertheless, I consider that the Claimant’s employment relationship with the Respondent had much stronger connections both with Great Britain and with British employment law than with any other system of law, such that Parliament would have regarded it as appropriate for the employment tribunal to deal with the claim.[60]Factors pointing in that direction include the location of the Respondent’s administrative and manufacturing base in Poole; the absence of premises and personnel (other than the Claimant) in Denmark; and the Claimant’s employment contract, which was couched in terms of UK employment law. The Claimant was selling products for a UK-registered company located in Poole. He was in regular contact with the Poole office, which acted as an administrative and decision-making hub. The products he sold in Europe were manufactured in and exported from Poole. As Mr Goodwin put it, the Claimant was the Respondent’s ‘man in Scandinavia’, selling the Respondent’s products there for the benefit of its business in Poole.[61]I have avoided the temptation to reason by analogy with the facts of other cases. Nevertheless, in so far as examples given in previous case law are useful, I accept Mr Goodwin’s point that the Claimant’s position is not dissimilar to the example given by Lord Hoffmann in Lawson v Serco Ltd of the employee selling advertising space in San Francisco for a UK newspaper as part of a business conducted in London. Lord Hoffmann considered that such an employee would fall within the territorial scope of the ERA. The advertising salesperson in his example was presumably British, whereas the Claimant is Danish. I do not accept Mr Goodwin’s suggestion that the Claimant’s nationality is immaterial; nevertheless, it is only one of the relevant factors to take into account.[62]I conclude that the Claimant’s statutory claims for unfair dismissal, redundancy pay and unlawful deductions from wages fall within the territorial scope of the ERA. Territorial scope – Working Time Regulations 1998[63]Finally, I must consider the claim for holiday pay under the WTR. Leaving aside any question of rights under European law, there is no reason why the territorial reach of rights in the WTR should be any different to those in the ERA. The question is essentially the same: did the Claimant’s employment have a sufficiently close connection with both Great Britain and British employment law? I have already answered that question in the affirmative in the context of the ERA, and I conclude that a similar analysis applies to the WTR.[64]The case of Bleuse v MBT Transport Ltd and anor is authority for the proposition that limitations on territorial scope have to be modified where necessary to give effect to a claimant’s directly effective rights under EU law. UK legislation that implements directly effective rights derived from an EU directive must be construed, so far as possible, to give effect to those rights, even if this means displacing normal domestic rules about territorial scope. If I had concluded that the Claimant did not fall within the territorial scope of the WTR applying the Lawson test, I would have regarded Bleuse as justifying a departure from that approach in respect of the right to four weeks’ paid annual leave set out in the Working Time Directive. However, my conclusion on the Lawson point means I do not need to decide the case on that basis.
Findings of fact
[1]The Claim for unfair dismissal is well-founded and is successful.[2]The Claim for unpaid holiday pay is well-founded and successful.[3]Following the findings as aforesaid the parties have resolved all matters including any Claimant liability for costs via a COT3 Agreement. THIS ORDER HAS BEEN APPROVED BY