THE UNITED STATES OF AMERICA v MR D J MILLS [2000] UKEAT 1236_99_2401

EMPLOYMENT APPEAL TRIBUNAL
BAILII case number: [2000] UKEAT 1236_99_2401Case No Appeal No. EAT/1236/99Venue 58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS
Between
THE UNITED STATES OF AMERICAAPPELLANTMR D J MILLSRESPONDENT
Before
His Honour Judge Peter Clark Professor P D WickensDate 24 January 2000
[1]APPEARANCES For the Appellants MR C GREENWOOD QC Instructed by: Messrs Clifford Chance Solicitors 200 Aldergate Street London EC1A 4JJ For the Respondent MR J DINGEMANS (of Counsel) Instructed by: Messrs Saunders & Co Solicitors 71 Kingsway London WC2B 6ST JUDGE PETER CLARK : This is an appeal by the respondent before the London (North) Employment Tribunal, the United States of America, against a decision of an Employment Tribunal chaired by Mr M S Rabin sitting on 13th September 1999, which held that it had jurisdiction to entertain a complaint of unfair dismissal brought by the applicant, Mr Mills. That decision was promulgated with extended reasons on 21st September 1999. In this judgment we shall describe the parties as they appeared below. The applicant, a British Citizen, was employed by the respondent as a consular assistant at their Embassy in Grosvenor Square, London, from 21st January 1980 until his dismissal on 27th January 1999. We are not concerned here with the merits of his claim for unfair dismissal, instituted by an Originating Application presented to the tribunal in April 1999.[2]That application was served on the respondent, which responded by a letter from its solicitors dated 2nd August 1999. In that letter those solicitors claimed immunity from suit under the provisions of the State Immunity Act 1978 ['SIA'].[3]It is common ground that the applicant was a member of the mission within the meaning of Article 1 of the Vienna Convention . His claim is based on his employment as a member of the mission. Consequently, the respondent is prima facie immune from suit before the tribunal by virtue of s.16(1)(a) of SIA which disapplies s.4 of the Act.[4]The basis upon which the tribunal rejected the respondent's claim to immunity involved their application of s.2 SIA to the undisputed facts of the case. S.2 provides, so far as is material:
"2.-(1) A State is not immune as respects proceedings in respect of which it has submitted to the jurisdiction of the courts of the United Kingdom. (2) A State may submit after the dispute giving rise to the proceedings has arisen or by a prior written agreement; but a provision in any agreement that it is to be governed by the law of the United Kingdom is not to be regarded as a submission. (3) A State is deemed to have submitted- … (b) subject to subsections (4) and (5) below, if it has intervened or taken any step in the proceedings.

(a) claiming immunity …"

[5]The tribunal found that by their solicitor's letter of 2nd August 1999 and by appearing for the purposes of claiming state immunity at the hearing of the preliminary issue before Mr Rabin's tribunal the respondent had not thereby submitted to the jurisdiction – s.2(4)(a). That finding is not challenged by the applicant before us.[6]However, the tribunal accepted a submission addressed to them by Mr Dingemans on behalf of the applicant, based on the respondent's "Foreign Service National Employee Handbook" ['the Handbook'] which, it is common ground, formed part of the applicant's contractual terms and conditions of employment, that the respondent had submitted to the jurisdiction of the tribunal, being treated as a court of the United Kingdom, by a prior written agreement within the meaning of s.2(2).[7]It is, we think, settled law that submission to the jurisdiction by prior written agreement must be express. It does not arise by implication – see per Lord Goff of Chieveley in Regina v Bow Street Magistrates, ex parte. Pinochet (No.3) [1999] WLR 827 , 858.[8]The tribunal was referred to various parts of the Handbook. We have also considered its terms. In our view a straightforward question of law arises in this appeal. Did the tribunal fall into error in finding that the terms of the Handbook contained an express submission to the jurisdiction by the respondent within the meaning of s.2(2) SIA?[9]The tribunal's reasoning is contained at paragraphs 6-9 of their extended reasons. In summary, they referred to the Foreword to the Handbook where it stated, among other things:
"Your employment is governed by the United States Government's Foreign Affairs Manual but where the United Kingdom law affecting contracts of employment applies, that law shall take precedence."
They go on to note that under paragraph 8 of the Handbook the respondent will endeavour to ensure that the conditions of employment and benefits are:
"similar to those found generally in the United Kingdom; that it is the policy of the US Government to establish local personnel programmes and policies which comply as closely as feasible with local laws, customs and practices if they do not contravene US laws and regulations."
The tribunal observe that nowhere in that comprehensive document is there an express exclusion of United Kingdom Employment Protection Rights.[11]They rejected the argument advanced by Mr Greenwood QC that the provisions of the Handbook were concerned only with the choice of law governing the contract of employment (the proviso contained in s.2(2) SIA) and found that the rights of foreign service staff should include the benefit of local laws and protections. In their words at paragraph 8 of the reasons:
"It flies in the face of logic and fairness to set out all these rights and benefits in the contract, and yet to hide behind the [ SIA ] when an employee tries to enforce them. A fortiori when the employer's own Appeal Board has made a ruling to reinstate the employee following a dismissal for a disciplinary offence."
[12]The tribunal found that the statement in the Foreword went beyond a choice of law clause, it was an express statement by the respondent to its employees that in disputes relating to their employment they shall have access to United Kingdom employment rights. Applying what they describe as the common sense principles of interpretation of contractual documents set out by the House of Lords in ICS Ltd v West Bromwich Building Society [1998] IWLR 896 they concluded that the statement in the foreword can only mean that the respondent's staff should have access to the Employment Tribunal if those rights are infringed. Accordingly, the tribunal did have jurisdiction to entertain the applicant's complaint.[13]Before dealing with the issue in this appeal we should record our gratitude to both counsel and those instructing them, first for the clear and detailed outline submissions on paper and secondly for the bundle of authorities containing all the relevant statutes, Treaties and other International instruments, cases and extracts from learned reference works. We have been greatly assisted, with the help of oral submissions by Counsel, in reaching a clear and unequivocal view in this case.[14]We should say at once that we find ourselves unable to agree with the view expressed by the Employment Tribunal.[15]Mr Dingemans accepts that for the tribunal to be correct in its conclusion there must be a clear and unequivocal submission to the jurisdiction by the respondent reading the Handbook as a whole.[16]In support of his submission that such a construction is not simply correct, but the only permissible construction, he has taken us to all those passages in the Handbook on which he relies. They are set out at paragraph 5 of his skeleton argument. In our judgment those passages amount, at most, to an acknowledgement by the respondent that the contract is governed by the law of United Kingdom. That, under s.2(2) is not enough.[17]There is only one reference to local courts or tribunals in the Handbook. Section 10.59.9 provides:
"No record of a grievance, a Board decision, Board recommendation or resultant action may be revealed to any person except those involved in the grievance, local Court or tribunal of competent jurisdiction or US Government Foreign Service Inspectors."
[18]Mr Dingemans does not submit that that provision, of itself, amounts to an express submission to the jurisdiction. It is part of the overall picture. We think that must be correct. To put the provision in context, it provides for limited circumstances in which either party may reveal the details of internal disciplinary or grievance proceedings. One of those circumstances arises where the record is relevant to local Court or tribunal proceedings. However that assumes, either that the respondent has submitted to that Court or tribunal's jurisdiction, or possibly, if the document becomes relevant in proceedings such as these, where the question of state immunity arises as the issue.[19]It seems to us, reading the document as a whole, that it comes nowhere near to containing an express submission.[20]Further, we consider that, on the face of their reasons, the tribunal allowed themselves to be swayed by irrelevant considerations. We refer particularly to paragraph 8 of the reasons. That an employee with a foreign state ought to be able to obtain redress through local Courts or tribunals for alleged breaches of local laws recognised by the State within the contract is nothing to the point. Nor is it helpful to refer to the employer "hiding behind" the SIA. Nor is it permissible for the tribunal's application of the Act, which in turn implements the United Kingdom's international obligations, to be influenced by its perceived view of the merits of the complaint (none of which was or should have been investigated at the preliminary hearing), in particular, the tribunal's reference to the respondent's Appeal Board reinstatement ruling.[21]We accept Mr Greenwood's submission that starting from s.1 SIA, the presumption is that an employee of a foreign state working within the United Kingdom will not have access to the Employment Tribunal to redress his complaint, here of unfair dismissal. It requires clear words within the contract of employment to rebut that presumption. Just as an employer relying on a fixed-term contract waiver clause relating to unfair dismissal or redundancy payments must show clear and unequivocal acceptance by the employee that he has waived his rights, so here the employee must show a clear and unequivocal submission to jurisdiction by the foreign state employer.[22]Mr Mills has not done so in our judgment. The tribunal was wrong in law to hold that it had jurisdiction to entertain the complaint. The appeal must be allowed and the Originating Application dismissed on the grounds that the respondent is immune from suit.