GEC Marconi Communications Ltd v Ryan [1995] UKEAT 1212_95_1212

EAT
GEC Marconi Communications Ltd v Ryan
[1995] UKEAT 1212_95_1212 · 1995-12-12
MR JUSTICE MUMMERY (PRESIDENT) The issue on this appeal is whether the Chairman of the Industrial Tribunal erred in law when he rejected the contention of GEC Marconi Communications Ltd ("Marconi") that the Applicant, Mr J Ryan, ordinarily worked out side Great Britain under his contract of employment. The Chairman, sitting at London (North) on 16th October 1995, held that the provisions of S.141 of the Employment Protection (Consolidation) Act 1978 did not apply to prevent Mr Ryan from claiming unfair dismissal by Marconi. The Tribunal accordingly had jurisdiction to hear his complaint under S.54 of the 1978 Act.The appeal against that decision, explained in Extended Reasons notified to the parties on 18th October 1995, was served by Marconi on 20th November 1995. Mr Ford, Marconi's Employee Relations Manager, represented Marconi and explained that, from Marconi's point of view, this was a test case in which they wished to obtain an authoritative ruling on the interpretation and application of S.141. Mr Ryan, who now lives in Sligo, travelled from the Republic of Ireland to argue his case in person. We are grateful to them both for the help and information provided to this Tribunal.

The Facts

The facts, which are not seriously in dispute, appear both from the decision of the Industrial Tribunal and from a bundle of documents which was before the Tribunal and has been supplied to us by Mr Ford. Not all the relevant matters referred to in those documents are expressly mentioned in the Extended Reasons.

The relevant facts may be summarised as follows:-

(1) Mr Ryan is a qualified Marine Radio Operator continuously employed by Marconi, a company based in England, from October 1960 to 28th July 1994. His employment ceased then on the expiration of a notice of dismissal on the grounds of redundancy given to him on 19th April 1994.(2) The terms and conditions of Mr Ryan's employment are governed by a Memorandum of Agreement dated 14th June 1984 made through the National Maritime Board between the Marconi International Marine Co Ltd and the Radio and Electronic Officers' Union. That document contains the terms and conditions for the employment of radio officers and provides in Clause II under the heading `Place of Service' that -The Officer shall be required to serve in any British ship in the Merchant Navy trading in any part of the world, and shall, on the employer's instructions, transfer from one ship to another at any time at home or abroad. Where possible, an Officer required to transfer in accordance with the foregoing at a port abroad shall be advised of such transfer prior to leaving a home port. The Officer shall not be transferred by an employer to a ship in which the installation is operated or controlled by another employer without the officer's consent.(The Officer shall not be requested to serve in a ship of foreign nationality when a suitable officer of that nationality can be obtained)."

The duties of the officer under Clause III include an obligation to -

"... obey and conform with all general orders and service regulations issued by the employer and with all instructions and directions given to him by any duly authorised official of the employer."
The agreement also contains provisions for remuneration, incidental payments and other allowances, limitation of hours, extra or emergency duties, leave and so on. We understand that this was the agreement in force at the date when Mr Ryan was dismissed.(3) From time to time Marconi gave instructions to Mr Ryan to join particular vessels on specified days. The terms and conditions of service applicable to those "assignments" were in accordance with the Memorandum of Agreement referred to in (2), with certain variations. We have been shown by Mr Ford an example of what is described as a "crew contract".(4) Instructions of that kind were issued by Marconi to Mr Ryan in connection with an agreement between Marconi and the British and Irish Steam Packet Co Ltd for the supply of radio officers to British ships. The bundle contains a copy of that agreement dated 28th June 1954. That Agreement contains provisions to the effect that radio officers provided under it by Marconi -
"... shall be engaged by the Company (ie Marconi) and shall serve the ship owner (British and Irish Steam Packet Co Ltd) in accordance with the conditions of employment of radio officers as laid down in the National Maritime Board Agreements that are from time to time in force."
Whilst on articles the Radio Officer shall be deemed to be the servant of the Shipowner and the Company shall not be liable for the consequences of any act, neglect or default whatsoever of any Radio Officer whether arising out of the performance of his duty or not ..."(5) There was undisputed evidence before the Chairman of the Industrial Tribunal that between 21st December 1991 and the redundancy notice in April 1994 Mr Ryan carried out a cycle of duties. At all relevant times he was ordinarily resident in England, but, in the last two years of his employment, he alternated between spells of duty as a radio officer on two ships, the MV Wicklow, which plied between Dublin and Rotterdam, and the MV Bison which plied between Dublin and Liverpool. Both vessels were either owned or were on charter to the B & I Line who have a registered office in Dublin. It was Marconi's understanding that Mr Ryan signed on crew agreements in Dublin at the start of each duty period. According to the record of the cycle of duties Mr Ryan spent 8 spells of duty on the Wicklow, which added up to 36 weeks, and 7 spells of duty on the Bison, which added up to 33 weeks.

The Decision

On the basis of those facts and of S.141 of the 1978 Act, the Chairman of the Industrial Tribunal concluded that Marconi had not shown that Mr Ryan, at the relevant time, ordinarily worked outside Great Britain. Mr Ryan was not therefore disqualified from pursuing the claim for unfair dismissal under S.54 which he had started by presenting an Originating Application on 21st September 1994. His claim was that he had been unfairly selected for redundancy. Other employees with less seniority remained. The "first in, last out" principle had not been applied by Marconi.

The Appeal

Marconi appealed against that decision on jurisdiction on a number of grounds which may be summarised as follows:-(1) Mr Ryan was made redundant when the Wicklow, on which he was serving at that time, was withdrawn from service. At that time he had continuously served on the Wicklow, apart from leave breaks, between 17th September 1993 and 23rd February 1994. The Wicklow was registered in Dublin and owned by the Irish company, B & I Line. Mr Ryan signed on and off crew agreements in Dublin and the Wicklow did not enter any UK ports. It plied between Dublin and Rotterdam.(2) It was therefore contended that, at the relevant time, namely his dismissal, Mr Ryan, under his contract of employment, ordinarily worked outside Great Britain. Jurisdiction to hear a claim of unfair dismissal was therefore excluded under S.141(2). Mr Ford submitted that this result was supported by a recent unreported decision of the Appeal Tribunal on 18th May 1994 - The Geest Line v. A L Wright (EAT/873/93).(3) Mr Ford also argued that S.141(5) of the 1978 Act could not be relied on by Mr Ryan because it was believed that the Wicklow was owned and registered in the Republic of Ireland, though the Bison was leased from a UK registered company. At the hearing of the appeal Mr Ryan said that the Bison was registered in England and Mr Ford was not disposed to dispute that. The Crew Agreements state that London is the Port of Registry.

The relevant law

The relevant law is as follows:-

(1) Section 141 of the 1978 Act is in a group of sections concerning "Excluded classes of employment". Section 141 deals with employment outside Great Britain. There are two relevant subsections -
"(2) ... Part ...(V) [does] not apply to employment where under his contract of employment the employee ordinarily works outside Great Britain."
"(5) For the purpose of subsection (2), a person employed to work on board a ship registered in the United Kingdom (not being a ship registered at a port outside Great Britain) shall, unless - (a) the employment is wholly outside Great Britain, or (b) he is not ordinarily resident in Great Britain, be regarded as a person who under his contract ordinarily works in Great Britain."
(2) Guidance on the proper approach to the interpretation and application of S.141(2) is contained in two Court of Appeal decisions - Wilson v. Maynard Shipbuilding Consultants AB [1978] ICR 376 and Janata Bank v. Ahmed (Qutubuddin) [1981] ICR 791. The decision of this Tribunal in The Geest Line v. A R Wright , followed that guidance.(3) The proper approach is to adopt a two-stage test.(a) The first stage is to look at the terms, express or implied, of the contract of employment relating to the whole period covered by the contract. If the terms of the contract of employment require an employee to work wholly or substantially wholly outside Great Britain, employment protection is excluded. If the terms and conditions of the contract require the employee to work wholly or substantially wholly in Great Britain, employment protection is not excluded.(b) If the terms of the employment contract do not provide an answer to the question where the employee ordinarily works, the Tribunal must proceed to the second stage. At that stage the Tribunal looks at the terms of employment with a view to ascertaining where, having regard to the whole period of the contract, the employee's base was to be. That stage involves examining all the relevant circumstances, including the terms of the contract, where the employee's home was or likely to be, in what currency he was paid, whether he was liable to pay National Insurance Contributions in Great Britain and so on.(4) The authorities also clearly indicate that an employee cannot ordinarily work both outside and inside Great Britain. A decision must be made one way or the other.

Conclusion

In our judgment, the Chairman of the Industrial Tribunal was legally correct in concluding that there was jurisdiction to hear Mr Ryan's complaint of unfair dismissal. We do not entirely agree with his reasoning for this result, which was based on the calculation of the number of weeks Mr Ryan spent on duty on the Wicklow and on the Bison between 7th February 1992 and 23rd February 1994. He concluded, on the basis of those calculations, that Marconi were wrong in submitting that Mr Ryan did not "ordinarily work outside Great Britain". Thirty-three weeks were spent on a vessel which plied between Dublin and Liverpool.In our view, that is not the approach in accordance with the authorities, but the error does not vitiate the decision or make it necessary for us to allow the appeal and remit the matter to the Industrial Tribunal for further consideration. It is clear from the facts found by the Chairman and from the relevant documents that the application of the correct legal principles produces the same result. Our reasons for dismissing the appeal are briefly these.(1) It is first necessary to consider the terms of the relevant contract ie, the 1984 Memorandum of Agreement between Marconi and Mr Ryan. That was the contract of employment in force at the date of Mr Ryan's dismissal. It was under that contract that Mr Ryan was assigned from time to time to spells of duty as a radio officer on various vessels, including the vessels owned by B & I. Under the 1954 Agreement Marconi agreed to supply officers engaged by them to serve B & I in accordance with the conditions of employment of Radio Officer laid down in National Maritime Board Agreement from time to time in force.(2) The contractual employment provisions only required Mr Ryan to serve in British ships in the Merchant Navy. Under S.141(5) a person who is employed to work on board a ship registered in the United Kingdom is " regarded as a person who under his contract ordinarily works in Great Britain".(3) The consequences of the combination of the terms of the agreement and S.141(5) could only be avoided if either(a) the employment was wholly outside Great Britain; or(b) Mr Ryan was not ordinarily resident in Great Britain.Neither of those apply to this case. He was ordinarily resident in Great Britain and his employment was partly in Great Britain ie, when on the Bison.(4) As the issue is resolved by the terms of the contract, it is not necessary to enquire about the second stage namely, whether in all the circumstances, including the contract, Mr Ryan's base was in Great Britain.(5) We have considered the Appeal Tribunal's decision in The Geest Line case, cited by Mr Ford, but conclude that it does not provide him with the support for his argument which he claimed. In that case the Appeal Tribunal allowed an appeal and declared that there was no jurisdiction to entertain the claim of unfair dismissal. The nature of the arrangements under consideration were significantly different than in this case. Mr Wright was employed under a series of crew agreements made between himself and the Geest Line. He was employed as a leading hand caterer on board vessels which sailed from Bury (in Wales) to the West Indies and back. The Tribunal considered the most recent of those agreements. The Tribunal commented that there would have been no problem in answering the question of jurisdiction if the vessel on which he served had remained registered in Great Britain. The problem arose because, about six weeks before Mr Wright was made redundant, the vessel in question was transferred by Geest Line Ltd and re-registered in the Bahamas. The Tribunal commented -
"... But for that re-registration the Respondent's right to complain about unfair dismissal would have been preserved by S.141(5) of the Act by which persons ordinarily resident in Great Britain employed to work on board a ship registered in the United Kingdom are deemed to be persons under their contracts ordinarily working in Great Britain unless the employment is wholly outside Great Britain."
Because of the re-registration the Tribunal had to consider the question of the application of S.141(2). In applying that section and the two-stage test laid down by the Court of Appeal the Tribunal found that the contract of employment, on its proper construction, led them to hold that Mr Wright ordinarily worked outside Great Britain. He was required to work on the vessel outside Great Britain because, out of 87 days of a tour of duty on that vessel, 72 days were spent out of Great Britain. The Tribunal in that case was, therefore, dealing with a contract made between the ship owner and the employee to serve on a particular non-UK registered vessel which spent most of its voyage outside Great Britain. That contract led to the conclusion that employment protection was excluded. As already explained the contractual arrangement in this case was that Mr Ryan remained throughout his contract an employee of a British based company, Marconi, under which he could only be required to serve on British vessels in the Merchant Navy, Service on such vessels under a contract of employment is regarded as ordinarily working in Great Britain. The circumstances in which it is not so regarded do not apply to this case, because Mr Ryan was ordinarily resident in Great Britain and it was not correct to say that his employment was wholly outside Great Britain. His service on the Bison showed that his employment was partly in Great Britain.For those reasons the appeal by Marconi is dismissed.