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JURISDICTION

Crofts and others v Cathay Pacific Airways Ltd and others: [2005] EWCA Civ 599

CA: Lord Phillips of Worth Matravers MR, Waller and Maurice Kay LJJ: 19 May 2005
May 19

All the applicants were originally employed as pilots by the first respondent, a Hong Kong company, but after a change of policy some were based in other areas, where they took up residence and entered into contracts with subsidiaries of the first respondent, which supplied the pilots to the first respondent under service contracts governed by Hong Kong law. The applicants' salaries were paid in Hong Kong where any grievance or disciplinary matters were dealt with and any training took place, but under the new arrangements they began and ended their tours of duty in their base area, received their flying instructions there and their salaries reflected the cost of living in those areas. The first respondent had an administrative centre in England, but the subsidiaries did not. The applicants were dismissed by letter from the first respondent as a result of a decision taken in Hong Kong. Five were based in London, six in Hong Kong and one was based in North America but lived in London. They complained to an employment tribunal of unfair dismissal contrary to section 94(1) of the Employment Rights Act 1996 and breach of their contracts of employment. The employment tribunal held that it had (i) jurisdiction to hear all the claims of the pilots based in London; (ii) no jurisdiction to hear the unfair dismissal claims of the other pilots; (iii) jurisdiction to determine the contractual claims of the pilots based in Hong Kong, but that those claims should be stayed on the ground of forum non conveniens; and (iv) no jurisdiction to entertain the contractual claim of the pilot based in North America. The Employment Appeal Tribunal dismissed appeals by the pilot based in North America and by the pilots based in Hong Kong in relation to their contractual claims (their appeals in respect of their unfair dismissal claims having been abandoned), and allowed an appeal by the employer of the London-based pilots, holding that those unfair dismissal claims were borderline and remitting them for a rehearing, at which a stay of their contractual claims on the ground of forum non conveniens was also to be considered.

The applicants appealed.

The Court of Appeal (Lord Phillips of Worth Matravers MR dissenting) held:
(1) The employment tribunal had jurisdiction to hear an unfair dismissal claim under section 94(1) of the Employment Rights Act 1996 where the claimant's employment was in Great Britain. That test had to be applied with a degree of flexibility and, in borderline cases, would depend on an assessment of all the circumstances of the employment. In the case of international airline pilots the place where their contract based them did throw light on where they were employed, and, because of the way their contracts of employment required them to live and work, the pilots based in London were in employment in Great Britain for the purposes of making unfair dismissal claims under the 1996 Act, whereas the other pilots were not so employed.
(2) The employment tribunal had the power to stay the applicants' contractual claims under rule 10(1)(2)(h) of the Employment Tribunals Rules of Procedure 2004 if it concluded that England was not an appropriate forum in which to bring those claims, and, since the claims were advanced against Hong Kong employers under contracts of employment governed by Hong Kong law, in respect of which the Hong Kong Labour Tribunal had jurisdiction, Hong Kong was, prima facie, the more appropriate forum. But, on the basis that the unfair dismissal claims of the London-based pilots were to proceed before the employment tribunal in England, that tribunal was the more appropriate forum to hear their contractual claims also.

The appeals of the London-based pilots were allowed. The other appeals were dismissed.

Appearances: David Griffith-Jones QC and Joanna Heal (Simpson Millar) for the pilots; Christopher Jeans QC and Anya Proops (Eversheds) for the employers.