SuperyachtNews.com – Operations – Unfair dismissal in the United Kingdom

The UK’s Employment Appeal Tribunal (EAT) has upheld the employment tribunal’s decision that it had jurisdiction to hear an unfair dismissal claim brought by an employee who worked on a superyacht which did not fall within the British waters.

Heidi Watson, partner at law firm Clyde & Co, writes that the steward in question, “Mrs Gordon”, worked on a superyacht managed by Yacht Management Company Limited (the Company) and that her home was in Aberdeen, United Kingdom. However, the terms of Ms Gordon’s employment contract stated that her workplace and accommodation were on the ship, which never entered British waters.

The Company was registered in Guernsey and did not carry on any business in the United Kingdom. It had no establishment in the United Kingdom and its management, payroll and human resources functions were carried out outside the United Kingdom.

When Ms Gordon was made redundant, she brought various claims against the company in the UK Employment Tribunal, including for unfair dismissal. The Company requested that these claims be struck out, arguing that the Labor Court did not have territorial jurisdiction to hear them.

The EAT ultimately upheld the Employment Tribunal’s finding that it had jurisdiction to hear Ms Gordon’s claims.

The EAT noted that an analysis of the whole factual matrix was necessary in order to determine territorial jurisdiction, rather than relying solely on Ms Gordon’s place of work as specified in her employment contract. The EAT concluded that Ms Gordon’s “base” was her domicile (in the UK), based on numerous factors, including:

• The location of the bank account into which Ms. Gordon’s salary was paid
• Its tax accounting with HMRC
• The law applicable to Ms. Gordon’s employment contract
• The choice of forum for disputes arising from one’s employment contract
• the basis on which Ms Gordon’s redundancy payment was calculated
• that the company had a contractual obligation to pay Ms Gordon’s travel costs between her home and the ship.

The EAT found that the Employment Tribunal could conclude that Ms Gordon’s duties began and ended at her home (in the UK), where she began her journeys to join the ship and where she returned after her tours.

Therefore, Ms Gordon was entitled to bring an action for unfair dismissal. Although the vessel she worked on had neither entered a UK port nor British waters during the course of her employment, her contractual obligations began and ended in the UK, which was also her “base”.

Practical points
This case is relevant for employers who are unsure whether or not a UK court would have jurisdiction over claims of unfair dismissal of their seafaring employees. If seafarers have such jurisdiction, employers will need to ensure that UK law and procedures are followed when dismissing seafarers whose base is in the UK.

While all cases depend on the facts, employers should determine where a seafarer’s “base” is. This is where a sailor’s service begins and ends. In this decision, the EAT reiterated that a “base” does not have to be a port or office; it may be a place far from the port where the sailor joins the ship. In this particular case, the EAT held that there was no reason why Ms Gordon’s home address could not be her base, if that is where her duties began and ended.

Please speak to Heidi Watson or your usual Clyde & Co contact if you have any questions or would like advice on this issue.

Case: Yacht Management Co Ltd v Gordon (2024)

Profile links

Clyde & Co.

Unfair dismissal in the UK

---

Click here to become part of The Superyacht Group community and join us in our mission to make this industry accessible to everyone and successful for the long term. We offer access to the superyacht industry’s most comprehensive and longest-running archive of critical information, as well as a comprehensive, real-time superyacht fleet database, for just £10 per month , because we are an industry with a mission. Register here.