Hong Kong: British employment law rights extended to employees based outside of Great Britain

The English Court of Appeal has held that Hong-Kong based cabin crew who served on flights between Hong Kong and London can bring age and race discrimination claims in England under English law (British Airways plc v Eliza Mak (2010))

Ms Mak plus 15 other British Airways cabin crew based in Hong Kong brought claims against British Airways in the English Employment Tribunal for age and race discrimination.

The claimants were born and recruited in Hong Kong, on Hong Kong employment contracts and were based and ordinarily resident in HK.

The claimants worked on flight cycles between Hong Kong and London. The claimants reported to managers in Hong Kong on such matters as performance, attendance, management, appraisals and complaints.

The main connections to England were that:

• they would spend 30 working minutes in British airspace before landing and after take-off;
• there would be a 45 minute debrief in London after landing;
• there would be a rest period in London of about 58 hours after landing during which, if they wanted to leave the hotel for more than 8 hours, they would need permission; and
• there was annual compulsory two day training in Great Britain as well as other ad hoc compulsory training in Great Britain.

The claimants' complaint was that they were in effect forced compulsorily to retire at 45 whereas BA international crew working out of London and elsewhere were not.

The jurisdictional issue turned on whether the claimants' employment was to be regarded as being at an "establishment in Great Britain". The relevant anti-discrimination legislation states: "…employment is to be regarded as being at an establishment in Great Britain if the employee…does his work wholly or partly in Great Britain". Accordingly the case turned on whether the claimants were working "wholly or partly" in Great Britain.

The Employment Tribunal was easily persuaded that the claimants worked at least partly in Great Britain throughout their employment. It estimated, on the basis of the 'connections' set out above, that about 5% of their working time was spent in Great Britain and the work was a "regular and crucial" part of their role.

The Court of Appeal agreed with the employment tribunal and found that there was no error in law in holding that compulsory training time in Great Britain counted as "work", as it was relevant to the proper performance of the claimants' safety duties. It held that Ms Mak did perform work partly in Great Britain that was not "trivial" but was a "regular and crucial" part of her role. It was not necessary for the claimants' work to actually have been done at a physical "establishment", as long as it was done at least "partly" in Great Britain.

Thus the claimants, despite being based in Hong Kong and having Hong Kong employment contracts, were able to sue under English anti-discrimination laws in England.

The UK's Equality Act 2010, which consolidates a number of anti-discrimination statutes and which came into force on 1 October 2010, is silent on its territorial scope. However, it is likely that tribunals will not wish to reduce the territorial scope from that which applied pre-October 2010 and there remains uncertainty as to how tribunals will approach these types of cases in future.

Practical Consequences

There is a risk, in light of this judgment, that employees based outside of Great Britain could accrue English anti-discrimination law rights if those employees have some connection to Great Britain (e.g. they attend training there or regularly go there on business or to meet with clients).

This could be problematic for the Hong Kong employer for a number of reasons: (1) there are discrimination laws in England which do not yet exist in Hong Kong e.g. age discrimination and sexual orientation discrimination, so Hong Kong employers might not be aware of the risks of types of potential claims and may not have policies in force to minimise their risk; (2) the potential awards for discrimination claims in England can be substantial; and (3) in order for an employee to waive or settle these types of claims once they arise they need to enter into a statutory "compromise agreement" (which requires the employee to be independently advised by a UK qualified lawyer). This means that a settlement/waiver in a normal Hong Kong separation agreement is not sufficient to waive all potential anti-discrimination claims under English law, if such claims have accrued to the employee.

It should be noted that an employee who meets this test may not be able to bring all types of employment claim in England. For, example there is a different test for unfair dismissal claims (see the House of Lords case of Lawson v Serco (2006). It is unlikely that the claimants in this case would qualify under that test.

Please contact Gareth Thomas or Michael Withington if you would like advice on overseas employment liability. For assistance with general UK employment law queries, please contact Andrew Brown in our London office.