Employment Disputes - Do Jurisdiction Clauses Always Work?
Should the UK courts rule on a dispute arising from an employment relationship in the Netherlands? In this case, the employer sought to pursue claims against its former employee.
Deciding which courts have jurisdiction to hear complaints involving employees can be complex - particularly where the employment crosses borders.
The general rule is that an employer may only bring proceedings against an employee in the courts of the member state in which the employee is domiciled.
However, this general rule can be departed from in circumstances where a jurisdiction agreement has been entered into after the dispute has arisen.
Merinson v Yukos International UK BV and others
In this case, proceedings had been brought and settled in the Dutch courts. It was specified that any disputes arising from the settlement agreement would be dealt with under Dutch law and would be heard by the Dutch courts.
However, the employer (Yukos International) subsequently chose to bring a claim against the employee (Merinson) in the UK. The High Court allowed the claim to be brought in the UK, deciding that the clause dictating jurisdiction was not binding, because it pre-dated the employment dispute.
Key Points to Note
- When dealing with a relationship that crosses borders, it is very important to think about where you may want any disputes which arise from the agreement to be heard.
- Bear in mind the Recast Brussels Regulation, which says that the employer can usually only bring proceedings in the country of domicile of the employee.
- As this case shows, jurisdiction clauses should not simply be drafted into agreements as an afterthought, but serious consideration needs to be given as to what the ability to bring proceedings in different countries could mean to both the employer and the employee.