Scott Paper (UK) Ltd v Lee [1995] UKEAT 443_95_1105

EMPOLYMENT APPEAL TRIBUNAL
BAILII case number: [1995] UKEAT 443_95_1105Case No Appeal No. EAT/443/95Venue 58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS
Between
Scott Paper (UK) LtdLee
Date 11 May 1995
[1]BAILII case number: [1995] UKEAT 443_95_1105 Appeal No. EAT/443/95 EMPOLYMENT APPEAL TRIBUNAL 58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS At the Tribunal On 11th May 1995 THE HONOURABLE MR JUSTICE MORISON MRS M E SUNDERLAND JP MRS P TURNER OBE SCOTT PAPER (UK) LIMITED APPELLANTS MR MICHAEL LEE RESPONDENT Transcript of Proceedings JUDGMENT Revised APPEARANCES For the Appellants MR B K HODGSON (Solicitor) Messrs Short Richardson and Forth 4 Moslem Street Newcastle-upon-Tyne NE1 1SR For the Respondent MR D GARLAND (of Counsel) Messrs Tuck & Mann King's Shade Walk 123 High Street Epsom Surrey KT19 8AU MR JUSTICE MORISON : One of the questions at issue before the Industrial Tribunal held at London (South) on 31st January 1995 was whether the Applicant, Mr Michael Lee, whom we shall call, if we may, "the Employee", had the right not to be unfairly dismissed. Section of 54 of the 1978 Act, which falls within Part V of that Act, confers on employees the right not to be unfairly dismissed and that right applies to every employment except where its application is excluded by, amongst other things Section 141 of the Act. Section 141(2) dis-applies Part V of the Act:
"... to employment where under his contract of employment the employee ordinarily works outside Great Britain."
These words have provoked a series of decisions including three in the relatively recent past in the Court of Appeal. As we understand the position, the following principles emerge. An employee cannot ordinarily work inside Great Britain and outside Great Britain at the same time. It is one or the other.[2]A Tribunal should look at all the relevant circumstances, if appropriate throughout the whole course of the employees past and prospective employment. Those circumstances will include, the terms of the contract, and sometimes where the employee's base may be said to be, and sometimes what happened in practice Janata Bank v Ahmed (Qutubuddin) [1981] ICR 791 . The Industrial Tribunal after hearing evidence, traced the Employee's employment contracts from Bowater Scott Corporation Ltd to Scott Ltd and as from 30th November 1991 to Scott Paper (UK) Ltd. In about 1993 he was offered the chance to take up a short-term or temporary engagement with Scott Paper Ltd in Vancouver, British Columbia, Canada, pursuant to their international assignment policy. Before leaving, the Employee was assured that if things did not work out the Scott Paper Company was his security blanket. The offer of the position was described as "temporary" and was expected to last at least two years. The Employee took up his post in Canada early in January 1994 but things did not work out, for various reasons including problems in relation to his children's schooling; and the benefits to which the Employee was entitled were apparently not paid when due. He decided to pack the job in and bring his family home. The Industrial Tribunal found that he did not resign or agree to a termination of his contract, but that he was told by the worldwide head of personnel "don't worry you will remain an employee". However, the position was rather different on his return to the United Kingdom. He ceased to be on the pay-roll of Scott Paper Canada as from 10th June 1994. As from 11th June 1994 he was on the pay-roll of Scott Paper (UK) Ltd and was paid up until 30th June 1994. On those facts the Employee argued before the Industrial Tribunal that his employer was Scott Paper (UK) Ltd, that his excursion to Canada was of a temporary nature and was a secondment, and throughout he was expected to return to the United Kingdom. The Employers argued that when he was sent to Canada, there was a significant variation of his contract of employment and the only place where he would ordinarily work under that contract, as varied, unless until it was varied again, was Canada. Therefore the Employee under his contract, as varied, ordinarily worked outside Great Britain. The Chairman looked at the whole of the Employees employment with the Scott Paper Group from 1977 and expressed these conclusions:
"It seems abundantly clear to me that the Applicant was seconded to the Canadian operation on a temporary basis. Looking at the contract as a whole, in my view the employee does not ordinarily work outside of Great Britain. The Applicant is therefore entitled to claim the benefit of Section 54 of Employment Protection (Consolidation) Act 1978."
Despite the fact that the Chairman had directed his mind to the case of Janata Bank v Ahmed and recited the relevant extracts from the judgment of Donaldson LJ, Master of the Rolls, in the Decision, the Employers appeal on the grounds that the Chairman:
"... failed to follow the guidelines set out by Donaldson LJ in that case ..."
The complaint that is made, is that the Chairman was wrong to look at the whole of the Employees employment from 1977:
"... notwithstanding the significant variation in his contract of employment effective January 1994 ..."
The passage in Donaldson LJ judgment upon which reliance is placed is as follows:
"The consecutive posting situation has, of course, to be distinguished from the case where an employee is appointed to a new position involving a significant variation in his contract of employment, as a result of which he is required to work in one particular country unless and until that contract is further varied. In such a case that will be the place and the only place at which he ordinarily works under his contract of employment."
The essence of what Donaldson LJ was saying was that the issue should not become bogged down by a large body of learning. He emphasised the need to look at the contract of employment and at what had actually happened on the ground, because the contract did not always tell the whole story. To illustrate this proposition he gave a number of examples of which the passage cited above was one. He was not speaking of or purporting to speak of temporary assignments by way of secondment coupled with assurances about the future. In this case, the arrangement was temporary and for a limited period of time. On his return the Employee went on to the books of the Company who had been his employer, in continuity of employment terms, since 1977. This is an example where the contract test does not provide the complete answer. The Court of Appeal had said on previous occasions that it was not sufficient to look only at the contract, and we cannot think that Donaldson LJ and the Court of Appeal were intending to overrule Todd v British Midland Airways [1978] ICR 959 or Wilson v Maynard Shipbuilding Consultants AB [1977] ICR 376 . In the latter case, the Court of Appeal rejected the argument that one should look at the last part of the contract immediately before the dismissal, and then ask where he ordinarily worked under that part. It was stressed that the contract throughout the whole period should be looked at. Just as it would be incorrect to say that a man who was employed to work one year in London and four years thereafter in France ordinarily works under his contract in London if he is dismissed in the first year, or France if he is dismissed thereafter. So here with an employee who was employed to work in Great Britain for seventeen years and seconded to Canada for a limited period of time, it would be incorrect to say that because he was dismissed from his position whilst on secondment to Canada he ordinarily worked in Canada, but if he had been dismissed on his return, he ordinarily worked in Great Britain. Having viewed the Employees employment as being a secondment and for a short period of time, as the Chairman was entitled to do on the evidence, his decision in our view cannot be faulted. Accordingly, despite the able argument which has been presented to us on behalf of the Appellant, we do not think there is any merit in it. Accordingly the Appeal will be dismissed.