Virtual Reality and ET collide

WynLewis

The Employment Tribunal system has brushed with Virtual Reality: you may be liable for more employees than you think. How?

The rights of overseas staff have taken up many column inches in recent years; employees in virtual reality less so. Recently a problem arose about someone who was both overseas and virtual; and this wasn’t the subject of a science fiction novel.

The issue is this: how far removed (physically or otherwise) from Great Britain does someone have to be before they lose their right to protection from unfair dismissal or discrimination? The answer is: nobody really knows for sure.

Since 2012, the test has been something like this: “where an employee’s place of work is not GB, is the connection with GB sufficiently strong that Parliament would reasonably have intended that an employment tribunal should deal with a particular employee’s claim?”.

That’s quite vague; also the cases have usually dealt with people who spent at least some of their time working in the GB office of the employer against whom they were bringing a claim, so the outcomes have been less than consistent.

Modern work practices mean that you don’t have to be in the office; sometimes not at all. In fact you don’t really need to be in the same country, so long as you have a decent Internet and phone connection that keep you in touch.

In this case, Mrs Lodge (an Australian citizen) was employed from February 2008 by two UK charities (Dignity & Choice In Dying and Compassion In Dying) to work in the UK as their head of finance. But from January 2009 she moved to live and work in Australia (in the same role, doing everything remotely for the same UK employers, but paying Australian tax and pensions and only visiting the UK three times each year – for 2 weeks and for 2 separate days) for the next 5 years, until she resigned in June 2013 having been told she would be the subject of a disciplinary process after a grievance.

That, from a GB perspective, was so remote working as to be seriously virtual.

Strangely (which was the oddest aspect of this case) the Employment Tribunal found that it wasn’t reasonable to assume that Parliament would have intended Mrs Lodge to be able to claim unfair dismissal in GB (even though it was quite happy to deal with her breach of contract claim). Sensibly, the Employment Appeal Tribunal disagreed about the unfair dismissal issue: it said that Mrs Lodge was like someone who had been posted abroad for the benefit of the home employer and that, because everything was managed from GB, she could claim unfair dismissal.

So what’s the lesson here?

It is that central (i.e. GB-based) management of overseas staff – especially if there is no regional or in-country management, and if issues like discipline and grievances are managed from GB, especially if there are no local, in-country employment contracts – will enable remote workers to bring claims; and could, in theory, enable people who have never even been to GB to do so too.

And the practical steps to take?

If this is a risk, then the practical steps are to introduce local management and delegated authority; to have a local contract; and to make that contract subject to local law (but that, in itself, has problems if you aren’t familiar with what that means and don’t have competent local lawyers). Although even this is unlikely to sever any link between the GB and “roving” regional personnel.

I’ve dealt with several of these cases for global charities. They need careful preparation before effective structures are set up in a way that exposes a GB employer to the least potential liability.