The appellant had been employed by the respondents since 1990 and from 1995 he worked overseas, firstly in Algeria and, since 2003, in Libya. The working arrangement was that he would work 28 days in Libya and then have 28 days at home in Preston.  He was paid in the UK, in sterling and paid UK tax and NI at source.  On being made redundant in 2006 he appealed internally at the employers Aberdeen office, where the employers HR functions were handled though the work was for a German subsidiary. Subsequent claims for unfair dismissal were heard in Scotland. The ET found, in a pre-hearing review, that, following Lord Hoffman in Lawson v Serco, they had jurisdiction to hear the claim even though the appellant did not fit any of the three categories outlined, instead identifying a sufficiently substantial connection with the UK. The EAT though found that the appellant was an expatriate, as defined by Lord Hoffman, and so outside the jurisdiction unless the circumstances were exceptional, which they found not to be the case. Further the ET had erred in law in applying the "substantial connection" test.

This Court of Sessions appeal, then, concerns the correct application and interpretation Lawson, with each judge reviewing the opinion of Lord Hoffman. Lord Osborne concludes that

"to invoke the jurisdiction successfully, it is not essential for a claimant, whose employment contains a foreign element, to demonstrate that he may properly be placed in one of the categories considered in detail by Lord Hoffman, since I consider that they are not exhaustive".

Accordingly, though the ET's reasoning could not be fully supported, the conclusion was correct. Lord Carloway also finds that the ET applied the wrong test but reached the right conclusion as the appellant was more peripatetic than expatriate and that the answer to the question that the ET should have asked, whether Parliament intended that an employee in these circumstances should receive protection from unfair dismissal, was affirmative. Lord Brodie, dissenting, concluded that Lord Hoffman in Lawson

"intended his three categories to cover all possible situations …... Thus, in every case where an issue arises as to whether an employment tribunal has territorial jurisdiction to determine whether an employee has been unfairly dismissed it will be possible to allocate the employee in question to one of the three categories"

Lord Carloway had agreed on this point but Lord Brodie differed in that he concluded that the appellant was an expatriate, and given that his business in Libya was for a German company, the circumstances were not exceptional and so refused the appeal.

___________________

EXTRA DIVISION, INNER HOUSE, COURT OF SESSION

Lord Osborne**

Lord Carloway

Lord Brodie

[2010] CSIH 52

XA33/09

OPINION OF LORD OSBORNE

in an appeal to the Court of Session under section 37(1) of the Employment Tribunal Act 1996

by

ISMAIL RAVAT (Appellant)

**

against

**

HALLIBURTON MANUFACTURING & SERVICES LTD (Respondents)

_______

Appellant: O'Neill QC; Lefevre Litigation

Respondents: Truscott QC; Paull & Williamsons

[1] I gratefully adopt the account of the background circumstances of this appeal and the summary of the contentions of the parties, some of which are more fully set out in such written submissions as were tendered, given in the opinion of Lord Brodie. A full and uncontroversial account of the facts found by the Employment Tribunal, relevant to their consideration of the issue of their jurisdiction, is to be found in their judgment in paragraphs 4 to 20.

[2] The judgment of the Employment Tribunal was the subject of an appeal to the Employment Appeal Tribunal on a question of law. The present appeal is brought, again on a question of law, with leave granted by the Employment Appeal Tribunal, to this court. In these circumstances, the question for us is whether the Employment Tribunal erred in law in holding that, on the facts found by it, that Tribunal had jurisdiction to entertain the appellant's claim for compensation for unfair dismissal.

[3] In order to answer that question, it is necessary, first, to identify the correct criterion to be applied in deciding the issue of jurisdiction. Secondly, the judgment of the Employment Tribunal must be examined to see whether any error of law occurred in the application of that criterion to the facts of the case, as found by it.

[4] As regards that first issue, it became apparent during the course of the debate before us that the decision of the House of Lords in Lawson v Serco Limited [2006] ICR 250 must be in the forefront of consideration. For that reason, I propose to examine that case in some detail, with a view to attempting to identify the criterion which has to be applied in deciding the issue of jurisdiction. At the outset, it is instructive to note that the decision in Lawson v Serco Limited was, in fact, a decision in relation to three separate appeals, that mentioned, [Botham v Ministry of Defence]()* and Crofts v Veta Limited.* In the first of these, the applicant was a British national, who was employed by the respondents, a company registered in England, as a security supervisor at an RAF base on Ascension Island. He was interviewed in England, paid in pounds sterling and given a "no tax" coding by the Inland Revenue on the basis that he worked on the island, a dependency of aUnited Kingdom overseas territory. The applicant resigned and brought a complaint of unfair dismissal pursuant to section 94(1) of the Employment Rights Act 1996, "the 1996 Act", in an Employment Tribunal in England. The Tribunal held that it had no jurisdiction to hear the complaint. The Employment Appeal Tribunal allowed an appeal by the applicant but, on appeal by the employer, the Court of Appeal held that the Tribunal did not have jurisdiction since section 94(1) applied only to employment in Great Britain.

[5] In the second case, the applicant, who was a British national, was employed by the Ministry of Defence as a youth worker at various military bases in Germany. As part of the civil component of the British Forces in Germany, he was treated as resident in the United Kingdom and paid United Kingdom tax and National Insurance contributions. When he was summarily dismissed, made a complaint of unfair dismissal to an Employment Tribunal in England. The Tribunal, the Employment Appeal Tribunal and the Court of Appeal concluded that they were bound by the decision of the Court of Appeal in the first case. Leave to appeal was granted to the applicant.

[6] In the third case, the applicant was an airline pilot employed by the respondent company, which was a wholly-owned subsidiary of a Hong Kong based airline. Both the respondent and its parent company were incorporated in Hong Kong. The airline operated a policy whereby certain air crew were based permanently at airports outside Hong Kong. The applicant was based at Heathrow airport and lived in the United Kingdom. He was dismissed and claimed that his dismissal was unfair. The Employment Tribunal held that it had jurisdiction to hear the claim. The Employment Appeal Tribunal allowed an appeal by the employer on the ground that the Employment Tribunal had applied the wrong test but, on appeal by the applicant, the Court of Appeal held that the Employment Tribunal did have jurisdiction to hear the claim. These three cases came before the House of Lords on appeal by the applicants in the first two cases and by the employers in the third case. In those appeals, the House of Lords held, first, that section 94(1) of the 1996 Act, which, of course, provides that: "An employee has the right not to be unfairly dismissed by his employer", did not have worldwide application and that the court had to give effect to its implied territorial limitation; further, that whether section 94(1) applied to any particular employment relationship was a question of law and that there was no basis for the exercise of a discretion; also that it would be contrary to principle for a claim under section 94(1) to be stayed on the ground of forum non conveniens; and that ordinarily the application of section 94(1) should depend on whether the employee was working in Great Britain at the time when he was dismissed. The House of Lords went on to hold, second, that, in the employer's appeal in the third case, when it came to a peripatetic employee, such as an airline pilot, the only sensible option was to determine where he was based; and that the Employment Tribunal had been right to reach the conclusion that the applicant in the third case had been based in Great Britain and came within the scope of section 94(1). Third, allowing the appeals of the applicants in the first two cases, the House of Lords held that, while it would be unusual for an employee who worked and was based abroad to come within the scope of section 94(1), there would be some who did, including a person posted abroad by a British employer for the purposes of a business conducted in Great Britain and an employee of a British employer operating within what was in effect an extra territorial British enclave in a foreign country; that the latter was the position of the applicants in the first two cases, who worked on British military bases abroad; and that, consequently, the Employment Tribunal had jurisdiction to hear their claims for unfair dismissal.

[7] The sole substantive judgment in the case was delivered by Lord Hoffmann, in which the four other judges who heard the appeals concurred. Thus it is appropriate to consider Lord Hoffmann's judgment, with a view to discerning the criterion for jurisdiction which must be applied in cases such as these. The exercise just mentioned is not an easy one, since his Lordship was at pains not directly to propone such a criterion. It appears to me to be necessary to infer from what he does say what that criterion is. In paragraph 1 he observes, in relation to the operation of section 94(1) of the 1996 Act, that the section:

"... tells us nothing about the connection, if any, which an employee or his employment must have with Great Britain. Nevertheless, all parties to these appeals are agreed that some territorial limitations must be implied. It is inconceivable that Parliament was intending to confer rights upon employees working in foreign countries and having no connection withGreat Britain. The argument has been over what those limitations should be. Putting the question in the traditional terms of the conflict of laws, what connection between Great Britain and the employment relationship is required to make section 94(1) the appropriate choice of law in deciding whether and in what circumstances an employee can complain that his dismissal was unfair? The answer to this question will also determine the question of jurisdiction, since the Employment Tribunal will have jurisdiction to decide upon the unfairness of the dismissal if (but only if) section 94(1) is the appropriate choice of law."

Thus, it is apparent from this passage that the search has to be for some connection between the employment relationship and Great Britain. The nature of that connection remains to be elucidated. Plainly, the matter is not free from difficulty for the reason that Lord Hoffmann gives in paragraph 6 of his judgment:

"Where legislation regulates the conduct of an individual, it may be easy to construe it as limited to conduct within the area of applicability of the law, or sometimes by United Kingdom citizens anywhere: see Ex parte Blain; in Re Sawers (1879) 12 Ch.D. 522. But section 94(1) provides an employee with a special statutory remedy. Employment is a complex and sui generis relationship, contractual in origin but, once created, having elements of status and capable of having consecutive or simultaneous points of contact with different jurisdictions. So the question of territorial scope is not straightforward. In principle, however, the question is always one of the construction of section 94(1)."

[8] Later on in his judgment Lord Hoffmann proceeded to consider the implications of the repeal of section 196 of the 1996 Act, which had contained various geographical provisions affecting the territorial scope of the legislation. In paragraph 11, Lord Hoffmann says of the situation existing prior to the repeal of that section:

"First, the original exclusion of cases in which the employee ordinarily 'works outside Great Britain' shows that when Parliament created the new remedy in 1971, it thought that the sole criterion delimiting its territorial scope should be the place where the employee worked. If he ordinarily worked in Great Britain, he should be entitled to protection. If not, then he should not. It attached no significance to such matters as the places where he was engaged, from which he was managed or his employer resided. The repeal of section 196 means that the courts are no longer rigidly confined to this single litmus test. Nevertheless, the importance which Parliament attached to the place of work is a relevant historical fact which retains persuasive force."

[9] It appears to me that that passage possesses some significance in the present context. In my opinion, it suggests that, subsequent to the repeal, in the consideration of what connection with Great Britain is necessary for jurisdiction of the Employment Tribunal to be available, something will depend on, among other things, "such matters as the places where [the employee] was engaged, from which he was managed or his employer resided."

[10] In paragraph 15 and following, Lord Hoffmann considers the several different formulations of a possible rule for the geographical limitation of the effect of section 94(1) of the 1996 Act, contended for by the various applicants. He referred to what he described in paragraph 16 as "the most simple and elegant solution", adopted by Pill LJ in the Serco case [2004] ICR 204, 207, para 8:

"The question is: what are the employments covered by the section? The answer, in our judgment, is straightforward though it may be difficult to apply in some cases: employment in Great Britain."

In paragraph 17 of his judgment Lord Hoffman said of this "solution":

"That is indeed putting the matter in a nutshell. But, as Lord Macnaghten memorably said of the rule in Shelley's Case (1581) 1 Co Rep 93 b, it is one thing to put a rule in a nutshell and another to keep it there: Van Grutten v Foxwell [1897] AC 658, 671."

As appears from Lord Hoffmann's subsequent observations on this topic, he did not favour that particular solution. He went on to consider a number of other formulations offered by counsel in the appeals in question, going on to reject them also. His own conclusions on these matters are set out in paragraphs 23 and 24 of his judgment. Because of the importance of these observations, I feel it necessary again to quote from these passages. In paragraph 23, his Lordship said:

"In my opinion the question in each case is whether section 94(1) applies to the particular case, notwithstanding its foreign elements. This is a question of the construction of section 94(1) and I believe that it is a mistake to try to formulate an ancillary rule of territorial scope, in the sense of a verbal formula such as section 196 used to provide, which must then itself be interpreted and applied. That is in my respectful opinion what went wrong in the Serco case. Although, as I shall explain, I think that there is much sound sense in the perception that section 94(1) was intended to apply to employment in Great Britain, the judgment gives the impression that it has inserted the words 'employed in Great Britain' into section 94(1). The difference between Lord Phillips of Worth Matravers MR and the majority of the court in Crofts v Veta Limited [2005] ICR 1436 was about how those words should be construed. But such a question ought not to arise, because the only question is the construction of section 94(1). Of course this question should be decided according to established principles of construction, giving effect to what Parliament may reasonably be supposed to have intended and attributing to Parliament a rational scheme. But this involves the application of principles, not the invention of supplementary rules."

In paragraph 24 of his judgment Lord Hoffmann continues:

"On the other hand, the fact that we are dealing in principles and not rules does not mean that the decision as to whether section 94(1) applies (and, therefore, whether the employment tribunal has jurisdiction) is an exercise of discretion. The section either applies to the employment relationship in question or it does not and, as I shall explain later, I think that is a question of law, although involving judgment in the application of the law to the facts."

As will be seen later, these particular observations have some significance in the context of the present case.

[11] In paragraphs 25 to 40 of his judgment, Lord Hoffmann proceeds to consider several different kinds of situation in relation to the issue of the application of section 94(1) of the 1996 Act. However, nowhere does he say expressly that the kinds of situation he considers amount to an exhaustive catalogue of those in which that enactment can be construed as operating; nor can that be implied from his observations, in my opinion. The first of these situations, what his Lordship calls "the standard, normal or paradigm case of the application of section 94(1)" is that of the employee who is working in Great Britain. In relation to that, section 196 of the 1996 Act, now repealed, was again considered. His Lordship thought that the emphasis which it placed on the contract of employment rather than the factual position at the time of dismissal reflected an approach which had now been departed from. He considered that concentration on the terms of the original contract of employment could "produce arbitrary and counter-intuitive results when, as often happens, the contract allowed the employer to direct where the employee would work."

[12] A further type of situation, namely that of peripatetic employees, is considered in paragraph 28 and following of the judgment. It is appropriate to note that the adjective "peripatetic" is defined in the Shorter Oxford English Dictionary as the state of: "walking about or travelling from place to place, especially in connection with an occupation; characterised by this; (of a teacher) working in more than one institution." Having considered that type of employment, in paragraph 29, his Lordship concludes:

"As I said earlier, I think that we are today more concerned with how the contract was in fact being operated at the time of the dismissal than with the terms of the original contract. But the common sense of treating the base of a peripatetic employee as, for the purposes of the statute, his place of employment, remains valid."

Summarising his position on peripatetic employees in paragraph 31 of his judgment, Lord Hoffmann concludes:

"Unless, like Lord Phillips of Worth Matravers MR, one regards airline pilots as the flying Dutchmen of labour law, condemned to fly without any jurisdiction in which they can seek redress, I think there is no sensible alternative to asking where they are based. And the same is true of other peripatetic employees."

[13] In paragraph 34 of his judgment, Lord Hoffmann goes on to consider the question of whether, on given facts, a particular case falls within or outwith the territorial scope of section 94(1) of the 1996 Act should be treated as a question of law. That issue plainly has implications for the extent to which the decision of an Employment Tribunal on such a matter is or is not open to appeal. Of that he says:

"In my opinion, therefore, the question of whether, on given facts, a case falls within the territorial scope of section 94(1) should be treated as a question of law. On the other hand, it is a question of decree on which the decision of the primary fact-finder is entitled to considerable respect."

In my opinion that observation possesses some importance in the context of the present case, in which the Employment Tribunal Judge gave a careful consideration to the issue of jurisdiction on the basis of the facts found by him.

[14] A further type of situation considered by Lord Hoffmann was that occupied by expatriate employees. It should be noted that the meaning of the word "expatriate" as a noun, as given by the Shorter Oxford English Dictionary, is "a person who lives from choice in a foreign country". As an adjective, it refers to: "living in a foreign country from choice also, of or relating to an expatriate or expatriates".

[15] It appears to me from what is said in paragraphs 35 to 39 of the judgment that, in dealing with expatriate employees, Lord Hoffmann was using the term expatriate in the sense of the definition to which I have just referred. It seems to me that that is evident from what is said in paragraph 36, where he refers to "an employee who works and is based abroad". I take that to mean someone whose place of work and base, which includes his place of residence, is situated in a foreign country. In relation to such a person as that, Lord Hoffmann says that:

"The circumstances would have to be unusual for an employee who works and is based abroad to come within the scope of British labour legislation. But I think that there are some who do. I hesitate to describe such cases as coming within an exception or exceptions to the general rule because that suggests a definition more precise than can be imposed upon the many possible combinations of factors, some of which may be unforeseen."

In my opinion, this passage is of some importance, since it affords a clear explanation of his Lordship's reluctance to depart from the view that the fundamental issue to be addressed in the multifarious cases that can occur is one of the interpretation of section 94(1) of the 1996 Act. The development of rules applicable to that task he considers inappropriate having regard to the range of combinations of factors which may be relevant to a decision of such cases. In paragraph 40 of his judgment Lord Hoffmann refers to examples of cases that he has given in which section 94(1) may apply to an expatriate employee. In this connection he says:

"I do not say that there may not be others, but I have not been able to think of any and they would have to have equally strong connections with Great Britain and British employment law."

Since, in my view, the appellant cannot properly be seen as an expatriate employee, this particular observation is not of direct relevance to his situation. However, I consider that what is said comes, perhaps, as close as anything in this judgment to an indication of the kind of connection with Great Britain and British employment law that an employee would require to show to be able to invoke successfully the jurisdiction of an Employment Tribunal in connection with a claim based upon section 94(1). Thus, the reference to "strong connections with Great Britain and British employment law" seems to me to be important. Indeed, I read that as providing an answer to the question which was posed in paragraph 1 of the judgment of what connection between Great Britain and the employment relationship is required to make section 94(1) the appropriate choice of law. In paragraph 35 of the judgment of the Employment Appeal Tribunal here, that Tribunal concluded that, in applying a test of "substantial connection" with Great Britain, the Employment Tribunal had erred in law. While that may be true in the most strict sense, as a matter of semantics, it appears to me that what I have taken to be the appropriate criterion described above differs but little from that rejected.

[16] I turn now to examine the decision of the Employment Tribunal in the light of what I consider emerges from Lawson v Serco Limited. The conclusions of that Tribunal are to be found in paragraph 38 to 55 of the judgment. I find myself in agreement with what the Employment Tribunal Judge says in paragraph 39. In particular, for the reasons I have given, it appears to me that, to invoke the jurisdiction successfully, it is not essential for a claimant, whose employment contains a foreign element, to demonstrate that he may properly be placed in one of the categories considered in detail by Lord Hoffman, since I consider that they are not exhaustive. I also agree with the view that an employee may have a place of work in a foreign country, but carry it out in a manner and in circumstances in which he cannot properly be described as peripatetic or expatriate. Indeed, having regard to the unchallenged findings in fact made by the Employment Tribunal, it appears to me that this is such a case; in my view, it would be a misuse of language to describe the appellant as either peripatetic or expatriate. Here, apart from the small amount of work which the appellant did at home in Preston, Lancashire, he worked solely in Libya, in accordance with the respondents' "international commuter assignment policy", applied to those working outside the United Kingdom on the form of rotational working pattern which he followed. What the appellant did was far removed from the working life of the archetypal peripatetic employee, an airline pilot. Further, in my opinion, it cannot be said that the appellant had an expatriate status, since his home was situated in the United Kingdom, although, no doubt, when working in Libya, he had a place of residence there. I agree with the Employment Tribunal Judge, who said in paragraph 41 of his judgment, that he was unable to categorise the claimant as an expatriate, since integral to that concept is the fact that the employee not only works abroad, but also lives there in some form of stable place of residence. He regarded an expatriate as "being more faithful to the root, one who has forsaken his native land". That is in accord with what Lord Hoffmann says in paragraph 36 of his judgment, in my opinion.

[17] In paragraph 47 of his judgment, the Employment Tribunal Judge looks at the particular circumstances of the present case with a view to determining whether what he calls "the substantial connection test" is or is not met. It will be obvious from what I have already said that I consider that the criterion must be "strong connection" as opposed to a "substantial connection". However, the use of the latter description does not seem to me in any way to detract from the significance of the factors which the Employment Tribunal Judge lists. Looking at those factors it is quite evident that some of them possess greater weight than others. Without wishing to diminish the significance of the others, consider that the fact that the appellant is a British national with his normal stable place of residence in England, where he lived with his family is of great importance. Furthermore I regard the fact that he was considered under an obligation to pay United Kingdom Income Tax and National Insurance contributions as of great significance. The Employment Tribunal Judge has also enumerated factors which he considered pointed away from a British connection. I would agree with the view that he takes in paragraph 49 that the resolution of the problem cannot be reached simply by enumerating factors operating in one direction and another. The issue must be whether looking at the whole circumstances of the case, on a proper interpretation of section 94(1) of the 1996 Act, its scope is to be regarded as applicable to the appellant.

[18] In paragraph 51 of the judgment of the Employment Tribunal, the judge, so far as I can see for the first time, refers to the criterion of "strong connections". It may be that he saw little distinction between that and the "substantial connections" to which he earlier referred. In any event, I am unable to conclude that, looking at the whole of his decision, the Employment Tribunal Judge applied the wrong criterion in addressing the question before him. However where, in my view, he did err in law is in what he said in paragraph 54 of his judgment. In that paragraph he observes:

"Weighing all the characteristics as a whole, I have found it difficult in this case to determine which side of the balance topples over. In the event, I have decided to find in favour of the claimant. I think this conclusion falls within the band of reasonable responses available to a reasonable chairman of employment tribunals, assuming the existence of such, in the assessment of the basket of facts present in this case. There are so many aspects of this claimant's employment relationship which strive to cling to Britain and British law that I think they should prevail over those which point in the other direction. Accordingly I conclude that in the circumstances peculiar to this particular case there remained a sufficiently substantial connection between the employment relationship and Great Britain. However I have regarded the case as being finely balanced and perhaps even a slight twist in the circumstances may have caused me to think differently."

[19] In this paragraph the Employment Tribunal Judge, in referring to "the band of reasonable responses available to a reasonable chairman of Employment Tribunals", appears to me to show that he considered the task which he was undertaking as the exercise of a discretion. It is quite evident from what was said by Lord Hoffmann in paragraph 24 of his judgment in Lawson v Serco Limited that that is not so. As he observes: "The section either applies to the employment relationship in question or it does not and, as I shall explain later, I think that is a question of law, although involving judgment in the application of the law to the facts." In these circumstances, in my opinion, it is not possible, without qualification, to affirm the decision of the Employment Tribunal, as it is formulated. However, because the application of section 94(1) to the circumstances of any particular employment relationship is a matter of law, it is one upon which this court can pronounce.

[20] Looking at the factual circumstances found established by the Employment Tribunal Judge, and applying to those circumstances the approach desiderated by Lord Hoffmann in Lawson v Serco Limited, I have reached the conclusion that section 94(1) must be interpreted as having application to the appellant's employment. Accordingly, I consider that the Employment Tribunal ultimately reached a correct conclusion and certainly one which it was entitled to reach, although certain parts of its reasoning, to which I have drawn attention, cannot be supported. I would therefore propose that the appeal should be allowed and the decision of the Employment Tribunal that the proceedings in the appellant's claim should be set down for a full hearing on the merits should be affirmed. The case, I consider, should be remitted to the Employment Tribunal to proceed as accords.

OPINION OF LORD CARLOWAY

**

[21] I agree with the terms of the introduction and the narrative of fact set out in the Opinion of Lord Brodie. The issue in this appeal is whether the right not to be unfairly dismissed, contained in section 94(1) of the Employment Rights Act 1996, extends to the appellant in the context of his employment with the respondents. Guidance in determining that issue is to be found in the speech of Lord Hoffman, with which the other members of the committee agreed, in Lawson v Serco [2006] ICR 250.

[22] The difficulty which arises stems from the radically different views expressed in submissions about what Lord Hoffman's speech means in practical terms. In order to understand it, it is necessary to look at the judgment of the Court of Appeal ([2004] ICR 204), delivered by Pill LJ, and to appreciate that Lawson v Serco related to a security supervisor at Ascension Island airport, who, though working for an English company, did not pay United Kingdom tax or, presumably, National Insurance Contributions.

[23] The Court of Appeal heard argument about the potential applicability of several tests, notably the "sufficient or substantial connection test", the "base test" and a "territorial extent test" (para 7). It rejected them all, including notably the substantial connection test (para 23), concluding that (para 8):

"The question is: what are the employments covered by the section. The answer, in our judgment, is straightforward though it may be difficult to apply in some cases: employment in Great Britain".

In reaching that conclusion, the Court of Appeal had in mind the backdrop of implementation of the Posting of Workers Directive (96/71/EC) and Parliament's repeal of the terms of section 196 of the Act, which had previously excluded situations where the employee "ordinarily works outside Great Britain".

[24] The Court of Appeal adopted the general principle that: "an enactment applies to all persons and matters within the territory to which it extends, but not to any other persons or matters (Bennion: Statutory Interpretation, 4th ed (2002), p 306)". It followed the dictum of Lord Wilberforce in Clark v Oceanic Contractors Inc [1983] 2 AC 130 (at 152) that the question to be answered was: "Who ... is within the legislative grasp, or intendment, of the statute under consideration". Following its conclusion that it was only "employment in Great Britain" that was grasped (see paras 17 and 18), the Court of Appeal held that the employee was not covered because he was "employed on Ascension Island".

[25] It is important to observe at the outset that one significant feature of the decision in the House of Lords was that it reversed the Court of Appeal and held that the employee, who was apparently working exclusively on Ascension Island, was within the grasp of section 94(1). In reaching that decision, Lord Hoffman first posed the question to be answered in what he describes as traditional conflict of law terms as follows:

"what connection between Great Britain and the employment relationship is required to make section 94(1) the appropriate choice of law ...".

He said that it would be the answer to this question that would determine jurisdiction. But he then (para 6) moved away from that approach to one of ascertaining the intention of Parliament when deciding, in an individual case, whether the section applied. He seemed initially to accept the of Court of Appeal's conclusion that the section applied to "employment in Great Britain" by referring to Pill LJ's dictum as "the most simple and elegant solution" which put the matter "in a nutshell". Despite the terms of his starting point, under reference to conflict of laws (supra), Lord Hoffman did not adopt a test of "substantial" or "sufficient" connection between the employment and Great Britain; although clearly there has to be a connection, and no doubt a substantial one, for section 94(1) to bite. Ultimately, he rejected Pill LJ's formulation, that the test was simply whether the employment is in Great Britain, upon the view that to adopt that test would be to incorporate words into the section, which are not there. Rather, his view was simply that:

"... the question in each case is whether section 94(1) applies to the particular case, notwithstanding its foreign elements".

That formulation does not, of itself, give any practical guidance. Perhaps because of that, Lord Hoffman then explored three different categories: "The standard case: working in Great Britain", "Peripatetic employees" and "Expatriate employees".

[26] Of course, a person "ordinarily" working in Great Britain will be covered by section 94(1). But when discussing this category (paras 25 et seq), Lord Hoffman talks not about whether, at the time of dismissal, there was "employment in Great Britain", as the Court of Appeal had done, but whether the employee was "working in Great Britain". An employee is not, according to Lord Hoffman, working in Great Britain if he chances to be in the country only in the course of "peripatetic duties based elsewhere" (para 27). But that must mean that an employee dismissed when working abroad may still gain protection in the converse situation. That is no doubt why there must, on this analysis, be the category of the peripatetic employee, to whom section 94(1) will apply, if the employee is based in Great Britain.

[27] At the other end of the scale is the "expatriate" employee, whom Lord Hoffman describes as someone who "works and is based abroad" (para 36). But, curiously, although such a person will neither be employed in Great Britain nor work here, he may still be covered by section 94)(1) where "exceptional" circumstances apply (para 40). Such circumstances require to amount to more than simply working for "an employer based in Great Britain" (para 37), but it may be enough if the employee is "posted abroad by a British employer for the purposes of a business carried on inGreat Britain" (para 38). The other example given, in the expatriate category, is an employee of a British employer who is operating within "an extra-territorial British enclave in a foreign country". Although he gives these examples within the category of expatriate employees, Lord Hoffman was not using his three categories themselves as examples of employees covered or not covered by section 94(1). He was setting out three definitive categories of employees, into which every person is capable of being squeezed.

[28] The question which remains to be answered is whether, therefore, Parliament intended that the appellant be covered by the protection afforded by section 94. In that respect, the Employment Tribunal did, as the Employment Appeal Tribunal recognised, apply the wrong test. In answering the correct question, regard must be had to Lord Hoffman's three categories. Clearly the appellant does not fall into the "standard case: working in Great Britain", but is he a peripatetic or an expatriate employee, in terms of Lord Hoffman's descriptions? If he is an expatriate employee, do exceptional circumstances apply to his case to indicate that, nevertheless and despite the foreign elements of his employment, Parliament would have intended that he be afforded protection?

[29] The conclusion of the Employment Appeal Tribunal, which had posed the correct question, was that the appellant "plainly" fell within the "expatriate" category. I am unable to agree with that application of the law to the facts. An expatriate employee is one who lives and works abroad. That does not apply to the appellant, who has his home in England, albeit that, for obvious practical reasons, he stays in Libya during the alternate months when he works there. As is found in fact, the appellant is employed under terms different to expatriate employees, namely as an "International commuter". Of course, the fact that the appellant's work is all in Libya is an important consideration. As Lord Hoffman noted, the historical exclusion of persons ordinarily working outside Great Britain, is significant; but it is no longer decisive.

[30] The appellant's employers are a British company based in Dyce. They provide personnel to other companies in the Halliburton group world wide. Although his services were being utilised by a German subsidiary, the respondents were paid for these services (i.e. ultimately the business for which the appellant was working was based in Dyce). All contractual aspects of the appellant's employment, including payroll and grievance procedures, were dealt with in Dyce. Most significant, not only was the appellant's salary paid in sterling into a British bank account, but he also paid United Kingdom tax and, of even greater significance, National Insurance Contributions. Although he is not a peripatetic employee in the sense of being a person travelling to different parts of the world, it ought not to make a difference whether, under particular arrangements, an employee travels monthly to the same place of work or to different places of work. Although the answer to which category he fits into may not be "plain", he is more peripatetic than expatriate, as these words are used by Lord Hoffman. Furthermore, asking the broader question of whether, notwithstanding the foreign elements, Parliament intended section 94(1) to apply to a person living in England, employed by a British company and paying United Kingdom tax and National Insurance Contributions, whose employers do not regard him as an expatriate but as a commuter and deal with all his contractual entitlements in Dyce, the answer is in the affirmative.

[31] For these reasons, although it applied the wrong test, the Employment Tribunal reached the correct decision that it did have jurisdiction to consider the complaint of unfair dismissal, which should now proceed to a full hearing on the merits.

[32] The appeal ought to be allowed and the judgment of the Employment Tribunal restored.

OPINION OF LORD BRODIE

**

Introduction

[33] This is an appeal under section 37 (1) of the Employment Tribunal Act 1996 from a judgment of the Employment Appeal Tribunal (Lady Smith sitting alone) given on 14 November 2008. The appellant is Ismail Ravat. The respondent is Halliburton Manufacturing & Services Ltd. The issue in the appeal is whether the Employment Tribunal has jurisdiction (in a territorial sense) to consider the complaint of unfair dismissal contrary to the provisions of section 94 (1) of the Employment Rights Act 1996, made by the appellant against the respondent in respect of his dismissal, supposedly by reason of redundancy, in May 2006.

[34] In August 2006 the appellant made a complaint to the Employment Tribunal of unfair dismissal and discrimination on the grounds of race. The complaint of unfair dismissal was brought in terms of section 111 of the Employment Rights Act. The question of jurisdiction came before the Tribunal atAberdeen (Mr RG Christie sitting alone) by way of Pre-Hearing Review, on 10 July 2007. The appellant withdrew his complaint of race discrimination and this was dismissed. Having heard evidence, by judgment registered on 23 November 2007, the Tribunal determined that it had jurisdiction to consider the complaint of unfair dismissal which therefore should proceed to a full hearing. The respondent appealed that decision to the Employment Appeal Tribunal. In a judgment given on 14 November 2008 the Appeal Tribunal upheld the appeal and dismissed the claim. Lady Smith granted leave to appeal on 3 February 2009. The appellant then appealed to the Court of Session.

[35] Appeal lies on a matter of law from an Employment Tribunal to the Employment Appeal Tribunal: Employment Tribunal Act 1996 section 21, and then with leave on a matter of law to this Court: 1996 Act section 37 (1). Notwithstanding the intervening appeal, the question for this Court is whether the Employment Tribunal erred in law: Scottish Midlands Cooperative Society Ltd vCullion [1991] IRLR 261.

The facts

[36] The facts found by the Tribunal are narrated at paragraphs 4 to 20 in its judgment and summarised by Mr O'Neill, counsel for the appellant, in his Note of Argument. There is no issue on the primary facts.

[37] Mr O'Neill's summary of the facts relating to the appellant's employment as found by the Employment Tribunal was as follows:

(i) The appellant lives in Preston and is a British citizen.

(ii) He was employed by the respondents who are British registered company, which is a subsidiary of large American multinational corporation. They have their main office in Aberdeen.

(iii) The appellant was employed by the respondents from 2 April 1990 until he was made redundant with effect from 17 May 2006.

(iv) From 1990 to 1995 the appellant's place of work was London. From 1995 onward his work for the respondents was outside the United Kingdom, initially Algeria. From 2003 he worked for the respondents in Libya.

(v) The work arrangements applied by the respondents to the appellant were that he worked back to back with another employee effectively job-sharing on a rotational basis 28 days work in Libya followed by 28 days at home in Preston, Lancashire.

(vi) The appellant's work pattern was in accordance with the respondents "International commuter assignment policy". This was a different arrangement from those designed by the respondents as having expatriate status in that they not only worked abroad but lived abroad. It was set out inter alia in his employment contract of March 2003 as revised by contract of May 2005.

(vii) As part of his contract of employment the appellant was retained on the normal UKpay and pensions structure which applied to their other UK based employees. He was paid in Sterling into a UK bank account. He paid UK tax and NI at source.

(viii) The business of the respondents was to provide services and personnel to other companies within the Hallibuton group. Thus while employed by the respondents, the work being carried out by the appellant in Libya was for a German co-subsidiary of the respondents, Halliburton Company Germany GmbH who were charged for the costs associated with the respondent's employing the appellant.

(ix) In terms of day to day operations, the appellant reported to an Operations Manager based in Libya and on policies issues reported to a Cairo based Africa Region Finance Manager, who was formally employed by another UK Halliburton subsidiary, Halliburton Management Ltd. but with whom his only face to face meeting was in London. The appellant's HR (including payroll, grievance and redundancy) issues were dealt with through the respondent's Aberdeen Office.

(x) The appellant was repeatedly reassured by the respondents that his employment relationship with them was governed by UK law, even when posted abroad. He was given a copy of the respondent's internal document "Guide for Host Country Managers" confirming this.

(xi) The appellant was also do some work for the respondents from the UK during his period of leave from the job, amounting to 2 to 3 day's work.

(xii) In respect of this threatened redundancy the appellant raised a grievance procedure, as advised in accordance with the respondent's UK grievance policy, which was heard in Aberdeen. The consultations leading to his eventual selection for redundancy were carried out in Aberdeen and the award made to him in respect of his eventual selection for redundancy purported to have been made in accord with UK statutory provisions. His appeal against dismissal was heard at the respondents' Aberdeenoffice.

The Employment Tribunal's understanding of the law and its application to the facts

[38] Having set out the facts, the Tribunal set out its understanding of the relevant law. It noted that the right not to be unfairly dismissed was conferred by section 94 (1) of the Employment Rights Act 1996, with the right to present a complaint of unfair dismissal to an employment tribunal being provided by section 111. It recognised that the territorial scope (or "legislative grasp") of these statutory rights must be taken to be limited in some way, but what that was had not been expressly stated in the relevant legislation subsequent to repeal of section 196 of the Employment Rights Act by section 32 (3) of the Employment Relations Act 1999 (with effect from 25 October 1999). However, as the Tribunal further recognised, guidance was to be had from the opinion of Lord Hoffmann in the decision of the House of Lords in Lawson v Serco Ltd [2006] ICR 250. Having considered the terms of paragraph 1 of Lord Hoffmann's opinion, the Tribunal, at paragraph 23 of its judgment, set out its understanding of the guidance to be taken from Lawson when determining whether the right not to be unfairly dismissed applies to a particular employment:

"23. It seems therefore, in very general terms, that an employment tribunal is now to look at 'any connection between Great Britain and the employment relationship' and to determine whether any such connection is of sufficient strength or substance to enable it to be said that Parliament would have intended that particular relationship to come within the scope of the Act. This principle had indeed been foreshadowed in two earlier decisions of the EAT -Jackson v Ghost Ltd [2003] IRLR 824- Financial Times Ltd v Bishop (EAT/0147/03). These indicated that an employment tribunal has jurisdiction under the Employment Rights Act if the employment in question had a sufficient and substantial connection with Britain."

[39] The Tribunal observed that Lord Hoffmann had in his opinion "contemplated" certain categories of employees: (a) the standard case where the employee is working in Great Britain, (b) the case of the peripatetic employee, and (c) the expatriate employee and then, having noted some of the things that Lord Hoffmann had had to say about, respectively, peripatetic and expatriate employees, drew together its conclusions. As a matter of general principle, the Tribunal did not consider it necessary as a first step to place any particular claimant into one or other of Lord Hoffmann's categories. At paragraph 39 of its judgment the Tribunal continued:

"...Nothing which [Lord Hoffmann] says suggests that that is an essential. It seems perfectly conceivable that an employee may have his place of work in another country abroad, but carries it out in a manner or in circumstances where he cannot properly be described as peripatetic or expatriate, and yet be operating in an employment relationship which has a substantial connection with the UK. Prior to coming to this particular case I have had in mind a British citizen who, for example, works abroad on what is often referred to as a 'rotational' system of working, say, four weeks in Africa followed by three weeks on leave at home with his family in, say, Edinburgh - and so on, following the pattern. I would not find myself able to categorise such an employee as either peripatetic or expatriate. The present case is one in point."

[40] It was accordingly the view of the Tribunal that the appellant fell into none of the three categories discussed in Lawson. Having noted, at paragraph 43 of its judgment, that "... the main obstacles in the [appellant's] path towards fulfilment of substantial British connection in his employment relationship is not only that he worked only outside Britain but at the relevant time was doing so in the business of a German company", the Tribunal went on to consider whether the "substantial connection" test, which it saw as having been laid down in Lawson, was met or not. It identified the various factors in the case which it saw as supporting the existence of such a connection and then the various factors which pointed away from a British connection. Among the factors supporting the existence of a connection was "the deliberate retention of UK legislation in the contractual documentation and also the verbal assurance given to the claimant that British employment rights would continue to pertain whilst [the appellant] was in Libya." That said, the Tribunal noted the terms of section 204 of the 1996 Act which provides:

"For the purposes of this Act it is immaterial whether the law which (apart from this Act) governs any person's employment is the law of the United Kingdom or of a part of the United Kingdom, or not."

[41] For the Tribunal, a factor pointing away from a British connection was the fact that the appellant "was working at all times in a foreign land, particularly at the time of his dismissal, and was doing so in the furtherance of the business operations of a company which was not British". However, in the Tribunal's opinion, referring to Lord Hoffmann's categories "this is not an expatriate case", and weighing all the characteristics as a whole, it concluded that in the circumstances peculiar to the particular case there remained a sufficiently substantial connection between the employment relationship and Great Britain. The Tribunal therefore concluded that it had jurisdiction to consider the complaint of unfair dismissal. It was against that decision that the now respondent appealed.

Discussion

The issue

[42] Section 94 (1) of the Employment Rights Act 1996 provides: "An employee has the right not to be unfairly dismissed by his employer." In terms of section 244, the 1996 Act applies to Englandand Wales and Scotland but not to Northern Ireland: in other words Great Britain rather than theUnited Kingdom. The question in this appeal is whether that right not to be unfairly dismissed extended to the appellant by virtue of his employment relationship with the respondent. Parties were agreed that guidance in answering that question is to be got from the decision of the House of Lords in Lawson v Serco Ltd supra, where Lord Hoffmann's opinion was concurred in by all the other members of the committee. Parties were not however agreed as to what Lord Hoffmann meant when giving that guidance. Mr O'Neill, for the appellant, contended that the correct approach to determining whether the section 94 right extended to a particular employee was to consider whether there was a "sufficient connection" or "substantial connection" between the employment relationship and Great Britain. Mr Truscott, for the respondent, contended that the correct approach was to consider which of the three categories referred to by Lord Hoffmann (the standard case, the peripatetic employee, and the expatriate employee) the employment fell into and then, with that as the starting point, look to the evidence with a view to determining whether, notwithstanding the foreign element, the employment could be regarded as being "employment in Great Britain". Both counsel claimed to find support in what Lord Hoffmann had said. Put shortly, Mr O'Neill's position was that the Tribunal had properly understood and applied Lawson while the Appeal Tribunal had not. Mr Truscott's position was the reverse.

[43] As Lord Hoffmann explained, the problem has to do with the "territorial scope" or "legislative grasp" of section 94. The right conferred by section 94 (1) is one to which one cannot contract in or from which one cannot contract out: Employment Rights Act 1996 section 204 and Bleuse v MBT Transport Ltd [2008] IRLR 264. As Mr O'Neill on behalf of the appellant accepted in the course of argument, although in paragraph 1 of his opinion, Lord Hoffmann talks about putting the question in the traditional terms of the conflict laws, he is there using an analogy, the issue is not one of choice of law, it is a question of how far (or to what employment relationships) the statute was intended to reach; that is a question of statutory interpretation.

[44] It is in paragraph 1 of his opinion that Lord Hoffmann sets the scene. It is convenient to quote that paragraph in full:

"1. My Lords, the question common to these three appeals is the territorial scope of section 94 (1) of the Employment Rights Act 1996, which gives employees the right not to be unfairly dismissed. Section 230 (1) defines an 'employee' as an individual 'who has entered into or works under (or, where the employment has ceased, worked under) a contract of employment'. But the Act contains no geographic limitation. Read literally, it applies to any individual who works under a contract of employment anywhere in the world. It is true that section 244 (1) says that the Act 'extends' to England and Wales andScotland ('Great Britain'). But that means only that it forms part of the law of Great Britainand does not form part of the law of any other territory (like Northern Ireland or theChannel Islands) for which Parliament could have legislated. It tells us nothing about the connection, if any, which an employee or his employment must have with Great Britain. Nevertheless, all parties to these appeals are agreed that some territorial limitations must be implied. It is inconceivable that Parliament was intending to confer rights upon employees working in foreign countries and having no connection with Great Britain. The argument has been over what those limitations should be. Putting the question in the traditional terms of the conflict of laws, what connection between Great Britain and the employment relationship is required to make section 94 (1) the appropriate choice of law in deciding whether and in what circumstances an employee can complain that his dismissal was unfair? The answer to this question will also determine the question of jurisdiction, since the employment tribunal will have jurisdiction to decide upon the unfairness of the dismissal if (but only if) section 94 (1) is the appropriate choice of law."

[45] Thus, notwithstanding the absence of any express limitation in the statute (by reason of repeal of section 196 of the Employment Rights Act by section 32 (3) of the Employment Relations Act 1999), some territorial limitations upon the application of section 94 must be implied. The right not to be unfairly dismissed will apply to some employment relationships. It will not apply to others. In the present case, the Tribunal describes the appellant as "working at all times in a foreign land". He nevertheless claims the protection of section 94 (1), which "extends" to Great Britain. In Mr O'Neill's Note of Argument, the appellant puts the matter of law at issue as being whether the jurisdiction of the Tribunal to consider the complaint of unfair dismissal is excluded by reason of the fact that the appellant carried out his work for his employer mainly outside the United Kingdom. I prefer a slightly different emphasis. I consider that the issue is better stated as being whether section 94 (1) applies to the case, notwithstanding its foreign elements (here the fact that the appellant worked entirely outside the United Kingdom, such tasks as were carried out at his home in England being not considered material by the Tribunal). That is how the issue was stated by Lord Hoffmann in Lawson at paragraph 23.

Substantial connection: not a test

[46] Parties were agreed that there will be employment relationships with foreign elements to which section 94 (1) will apply and employment relationships with foreign elements to which it will not. If the authoritative source of guidance is Lawson, what then does Lord Hoffmann say about how one distinguishes the cases to which the grasp of legislation extends from those to which it does not? The Tribunal considered that he laid down a "substantial connection [between the employment relationship and Great Britain]" test and then proceeded to apply that test in determining that it had jurisdiction to hear the appellant's complaint of unfair dismissal. In my opinion, Lord Hoffmann did no such thing and, accordingly, agreeing with the Appeal Tribunal, I consider that the Tribunal erred in law.

[47] The Tribunal purported to find the "substantial connection" test in paragraph 1 of Lord Hoffmann's opinion. The first thing to say about that, is that paragraph 1, which is quoted above in full, does not set out a "substantial connection" test or indeed any other test. A feature of Lord Hoffmann's opinion is that, having been addressed by counsel on a number of suggested formulations, including "closer connection with Great Britain ...than with any other country" (paragraph 22), he goes out of his way to eschew any test whatsoever. The formulation of an ancillary rule, he said, was what had gone wrong when Lawson was in the Court of Appeal. For Lord Hoffmann the question was one of interpretation of section 94 (1) according to established principles of construction, not the invention of supplementary rules: Lawson paragraph 23. Before us, Mr O'Neill expressly conceded as much, and accepted that while he contended for a sufficient or substantial connection test this was on the basis that he commended it as a practical test and that there was nothing in Lord Hoffmann's opinion that was inconsistent with it. That is a very different approach from that taken by the Tribunal. It is equally unsupported by anything that Lord Hoffmann said.

[48] It is true that the word "connection" appears (on three occasions) in paragraph 1 of Lord Hoffmann's opinion. That is not to say that he is enunciating or endorsing any test of the sort that was applied by the Tribunal and advocated by Mr O'Neill. If section 94 (1) is subject to territorial limitation it follows that it will apply to some employment relationships and not to others. It also follows that the employment relationships to which it applies will be sufficiently and therefore substantially connected to Great Britain in a way that those to which it does not apply are not. As Lord Hoffmann put it:

"It is inconceivable that Parliament was intending to confer rights upon employees working in foreign countries and having no connection with Great Britain."

Equally, Parliament may be taken to have been intending to confer rights upon employees working in Great Britain and who were otherwise connected with Great Britain in every way imaginable. It does not, however, follow that it is the law that in situations lying between these two extremes: working abroad with no connection and working in Great Britain with every connection, whether section 94 (1) is to apply to the employment relationship is to be determined by a test which relies in some way on the strength or potency of what are put forward as connections with Great Britain. Had Lord Hoffmann wished to lay that down as being the law it would have been very easy for him to do so. He did not. The substantial connection test is not an invention of Mr O'Neill, or of the Tribunal in the present case. It has been applied by the Employment Appeal Tribunal as variously constituted: e.g. Financial Times Ltd v Bishop supra and Jackson v Ghost Ltd supra, but it was expressly rejected by the Court of Appeal when Lawson was before it: Lawson v Serco supra at paragraphs 23 and 24. The House of Lords held that the employment tribunal had jurisdiction in Mr Lawson's case, thereby reversing the Court of Appeal in result, but had Lord Hoffmann intended to reinstate the substantial connection test it is very difficult to understand why he did not do so in terms, given its strong rejection in the Court of Appeal.

Employment in Great Britain; working in Great Britain

[49] Not only did Lord Hoffmann not reinstate the substantial connection test but, as I have indicated, he declined to put forward any other test. His concern is with "territorial limitations" (paragraph 1) and "territorial scope" (paragraph 2). He explains that the general principle of construction of United Kingdom legislation is that prima facie it is territorial (paragraph 6). Thus, the scope of section 94 (1) is limited to a territory and that territory is Great Britain. That, of course, is to beg the question: what is it that is to be localised in Great Britain? When Lawson was in the Court of Appeal Pill LJ had answered that question as follows:

"The question is: what are the employments covered by the section? The answer, in our judgment, is straightforward though it may be difficult to apply in some cases: employment in Great Britain."

Lord Hoffmann's comment on that formulation is: "That is indeed putting the matter in a nutshell. But ...it is one thing to put the rule in a nutshell and another to keep it there" (paragraph 17). Later (at paragraph 23) he says: "I think that there is much sound sense in the perception that section 94(1) was intended to apply to employment in Great Britain" but, in keeping with his preference for principles over rules, he criticises the judgment of the Court of Appeal as giving the impression that "employed in Great Britain" was to be implied into section 94(1) and, equally he goes on to reject the various attempts at an alternative formulation suggested by counsel. Thus, there is no "test" beyond the principle that the right not to be unfairly dismissed only applies to employment in Great Britain.

[50] To say that the right not to be unfairly dismissed only applies to employment in Great Britain may seem to be a rather modest insight where what is in issue is territorial scope of a provision which "extends" to Great Britain; it is stating the question rather than providing the answer. That is particularly so where "employment", a word with a number of meanings, is not defined. In paragraph 6 of his opinion Lord Hoffmann describes "employment" as "a complex and sui generisrelationship, contractual in origin but, once created, having elements of status and capable of having consecutive or simultaneous points of contact with different jurisdictions", but "employment" can also mean the doing of work. As I read his opinion, when he says that "there is much sound sense in the perception that section 94 (1) was intended to apply to employment in Great Britain", Lord Hoffmann had in mind employment in the sense of working. Admittedly, it is not entirely clear-cut. Regard has to be had to the fact that by section 32 (3) of the 1999 Act Parliament repealed the exclusion from section 94 (1) protection of employment where the employee "ordinarily works outside Great Britain". Lord Hoffmann addresses this at paragraph 11 of his opinion:

"... the original exclusion of cases in which the employee ordinarily "works outside Great Britain" shows that when Parliament created the new remedy in 1971, it thought that the sole criterion delimiting its territorial scope should be the place where the employee worked. If he ordinarily worked in Great Britain, he should be entitled to protection. If not, then he should not. It attached no significance to such matters as the places where he was engaged, from which he was managed or his employer resided. The repeal of section 196 means that the courts are no longer rigidly confined to this single litmus test. Nevertheless, the importance which Parliament attached to the place of work is a relevant historical fact which retains persuasive force."

What I take from this passage and what follows in Lord Hoffmann's opinion is that, while not absolutely determinative, employment in Great Britain, in the sense of doing work within the geographic confines of Great Britain, is the core concept underlying the territorial scope or legislative grasp of the section 94 (1) right. I see that as being virtually stated in terms in the paragraphs of the opinion headed "The standard case: working in Great Britain". At paragraphs 25 and 27 Lord Hoffmann says this:

"25. ... I am sure that Pill LJ was right in saying that what Parliament must have intended as the standard, normal or paradigm case of the application of section 94 (1) was the employee who was working in Great Britain. As I said earlier, the fact that Parliament in 1971 and subsequently until 1999 thought that ordinarily working in Great Britain was an appropriate criterion for territorial scope remains indicative of what the general intent is likely to have been...

1. Since 1971 there has been a radical change in the attitude of Parliament and the courts to the employment relationship and I think that the application of section 94 should now depend upon whether the employee was working in Great Britain at the time of his dismissal, ... The terms of the contract and the prior history of the contractual relationship may be relevant to whether the employee is really working in Great Britain or whether he is merely on a casual visit (for example, in the course of peripatetic duties based elsewhere) but ordinarily the question should simply be whether he is working in Great Britain at the time when he is dismissed. ..."

The point gets further emphasis in paragraph 37. There Lord Hoffmann is discussing the case of expatriate employees (who, as I shall explain below, in my opinion are to be understood as being employees who work outside Great Britain, irrespective whether they live abroad or not). Lord Hoffmann says this:

"37 ... I think that it would be very unlikely that someone working abroad would be within the scope of section 94 (1) unless he was working for an employer based in Great Britain. But that would not be enough. Many companies based in Great Britain also carry on business in other countries and employment in those businesses will not attract British law merely on account of British ownership. The fact that the employee also happens to be British or even that he was recruited in Britain, so that the relationship was 'rooted and forged' in this country, should not in itself be sufficient to take the case out of the general rule that the place of employment is decisive. Something more is necessary."

Thus, the general rule is that the place of employment is decisive. True, the expression used is "place of employment" rather than "place of work" but the context of this discussion of the position of the expatriate employee is set by the first sentence of paragraph 37 with its statement that "it would be very unlikely that someone working abroad would be within the scope of section 94 (1)". Again the emphasis is on "working".

Lord Hoffmann's categories: standard, peripatetic and expatriate

[51] Having identified the standard, normal or paradigm case of the employee working in Great Britain, Lord Hoffmann discusses two other cases: peripatetic employees and expatriate employees. The adjectives used are perhaps a little problematic in that although they qualify "employees", this leaves open just which aspects of an individual employee's life are relevant to consider when determining if he is peripatetic or expatriate. However, given that the paradigm case focuses on working in Great Britain, what I understand Lord Hoffmann to be referring to with his second and third categories are employees who, respectively, are when working, moving from one place to another or are away from their native land (for present purposes Great Britain). That interpretation is consistent with the way in which the two adjectives are used throughout the opinion. For example in paragraph 5, in summarising the facts in one of the two other cases argued along with Lawson, Lord Hoffmann said this:

"In Crofts the employer was foreign but the employee was resident in Great Britain and, although his services were peripatetic, they were based in Great Britain."

What Lord Hoffmann is concerned with is the peripatetic nature of the services. He is not concerned with the fact that the employee who was resident in Great Britain would therefore have to travel if he were to perform them abroad. The point is reinforced by the way that Lord Hoffmann considers the three cases on appeal at the beginning of paragraph 21:

"While Mr Lawson and Mr Botham might be called expatriate employees, working abroad in circumstances in which their work nevertheless had strong connections with Great Britain, Mr Crofts was perhaps an extreme example of a peripatetic employee, whose work constantly took him to many different places."

As Lord Hoffmann uses the respective terms, Mr Crofts could be described as a "peripatetic" employee because his work constantly took him to many different places, whereas Mr Lawson and Mr Botham might be called "expatriate" employees because they were working abroad, albeit in one place rather than many places. In each case the emphasis is on the place of doing work. Neither in the quoted passages nor elsewhere in his opinion does Lord Hoffmann expressly attach any significance to where an employee resides.

[52] Lord Hoffmann's categories can cover all possibilities: the employee who works in Great Britain, the employee who works partly in Great Britain and partly abroad, and the employee (possibly but not necessarily of British origin) who works entirely abroad (as I have said, I see his place of residence to be irrelevant). Mr O'Neill submitted that the three categories were not exhaustive but merely examples. It is very difficult to understand why Lord Hoffmann should have limited himself to examples which did not, taken together, exhaust all possibilities, particularly when the House must be taken as having been attempting to give general guidance and when one of the selected categories, the first: working in Great Britain, did not, on Lord Hoffmann's approach, apply to any of the three cases under appeal. In my opinion, Lord Hoffmann intended his three categories to cover all possible situations, albeit that they were not necessarily co-extensive with the right not to be unfairly dismissed. Thus, in every case where an issue arises as to whether an employment tribunal has territorial jurisdiction to determine whether an employee has been unfairly dismissed it will be possible to allocate the employee in question to one of the three categories. He will attract section 94 (1) protection either where he falls within the standard case of working in Great Britain or where, despite the foreign element constituted by his working to a greater or lesser extent in a territory outside Great Britain, the circumstances are such that the employee should be treated as if his whole work is carried out in Great Britain (because he is based in Great Britain if he is in the second category; or because he was posted abroad for the purposes of a business carried on in Great Britain or he was working in a British enclave if he is in the third category).

Conclusion

[53] Turning to the present appeal, the Tribunal having misdirected itself in law, the question as to whether the Tribunal has jurisdiction in the territorial sense is one for this Court. As I have indicated, the statutory right not to be unfairly dismissed is not something that parties can contract into. Accordingly, express provisions or other circumstances indicating that Scots law or the law of theUnited Kingdom is the proper law of the contract are neither here nor there. The crucial finding by the Tribunal and the starting point for consideration of the question in issue is that from 1995 onward the appellant's work for the respondent was outside the United Kingdom, initially in Algeriaand from 2003 in Libya. As the Tribunal put it, the appellant was "working at all times in a foreign land". He therefore does not fall into the first or standard category. Nor does he fall into the second or peripatetic category. He travelled back and forward between home and work, as most employees do. He, however, only made the back and forward journeys once a month and in doing so travelled from Libya to Great Britain and then returned. In my opinion, that did not make him a peripatetic employee. He travelled to get to his place of work; he did not travel from place to place in doing his work, as would an airline pilot, a mariner or an international salesman.

[54] In my opinion there is no question but that the appellant falls into Lord Hoffmann's expatriate employee category. That is not how he was described in the contractual documentation but that is neither here nor there. As I have already pointed out, the section 94 (1) right cannot be conferred by contract and it may be that Lord Hoffmann's use of the adjective "expatriate" does not coincide precisely with more common usage. I accept that "expatriate", more usually in its abbreviation "expat", conjures up an image of someone living as well as working abroad (indeed the emphasis may well be on the living rather than the working). However, for the reasons that I have tried to set out, living arrangements do not comprise a necessary element in Lord Hoffmann's three categories. Someone doing his work in London would fall within Lord Hoffmann's first or standard category while someone doing his work in Paris would fall within Lord Hoffmann's third or expatriate category quite independent of whether, in either case, he lived in Dover or in Calais. Were I to be wrong about that then, of course, it would seem to follow that I would also be wrong about Lord Hoffmann's three categories being comprehensive and the, rather puzzling, conclusion would be that Lord Hoffmann chose to discuss three but only three out of a larger number of possible categories of employees. As I have already noted, that could not be explained by the requirements of the particular cases on appeal; none of them fell into the standard category.

[55] Lord Hoffmann thought it very unlikely that someone working abroad, as I consider it is clear that the appellant was here, would be within the scope of section 94 (1). He posited some exceptional cases where, however, he might be. Here the appellant was an expatriate employee: he has been sent out of Great Britain in order to work. He was not posted abroad for the purposes of a business carried on in Great Britain. Rather, the work being carried out by the appellant was carried out in Libya for a German co-subsidiary of the respondent. I do not see him as falling within any other exceptional case identified by Lord Hoffmann at paragraph 39 of Lawson. The general rule applies. I would refuse the appeal.

Post script

[56] By way of post script, although not relevant to this appeal, it is to be noted that in terms of section 201 of the Employment Rights Act 1996 (and in earlier legislation) there is power given to extend various employment rights not only to the territorial waters of the United Kingdom but also to the UK and foreign sectors of the continental shelf. This power was exercised by the enactment of the Employment Protection (Offshore Employment) Order 1976, SI 1976/766. The existence of this statutory power to confer protection on employees who are not working in Great Britain may not take the argument much further forward. The power originated when section 27(2) of the Industrial Relations Act 1971 which stated that the right not to be unfairly dismissed, then conferred by section 22 of the Act (as re-enacted by the Trade Union and Labour Relations Act 1974), did not apply "to any employment where under his contract of employment the employee ordinarily works outside Great Britain", and therefore if an employee worked off-shore he would not have the benefit of section 22 of the 1971 Act without special provision. However, that SI 1976/766 remains in force subsequent to the repeal of section 196 of the 1996 Act is at least consistent with the view that the general rule is that the place of employment (in the sense of the place of work) is decisive.