June 30, 2015

No UK Employment Rights for Internationally Mobile Employee

In Olsen v Gearbulk Services Ltd UKEAT/0345/14/RN, the Employment Appeal Tribunal (EAT) considered whether an internationally mobile employee could bring a claim for unfair dismissal under UK law on the basis that he spent more of his working time in the UK than in any other country.

Mr Olsen was a Danish national employed by a Bermudan company as a Strategy and Business Development Director. His employment contract was governed by Bermudan law and subject to the jurisdiction of the Bermudan courts. He was based in Switzerland but spent more time in the UK office than in any other single international office. Prior to entering into the Bermudan agreement, he had first been offered a contract governed by UK law under which his place of work would have been the UK; he had rejected this for tax and family reasons. He also made sure that he never spent enough time in the UK to become subject to UK taxation. Following his dismissal, he sought to bring a claim for unfair dismissal in the UK. The first issue to determine was whether he was entitled to bring such a claim under UK law. The EAT found that he was not because his employment was not sufficiently closely connected with the UK. In particular, it was significant that (a) Mr Olsen did not have a base in the UK, (b) his role was international which meant he could carry it out anywhere in the world, and (c) he had carefully structured his working arrangements and the time he spent in the UK to avoid UK tax. 

Although the employee in this case was found not to have UK employment rights, employers of internationally mobile employees need to bear in mind that this is a complex and fact-sensitive area of law.

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