Ms. Benkharbouche and Ms Janah are Moroccan nationals who were employed as members of the domestic staff of, respectively, the Sudanese and the Libyan Embassy of London.
After being dismissed, they brought proceedings before the competent employment tribunal against their employer States, alleging violations of a number of employment rights, notably unfair dismissal, failure to pay the minimum wage, racial discrimination, harassment and breach of the Working Time Regulations of 1998.
After the employment tribunals upheld the plea of sovereign immunity raised by the defendants, appeals from the two decisions were heard together by the Employment Appeals Tribunal, whose decision was then appealed to the Court of Appeal (England and Wales). This last Court decided the case without making any reference for a preliminary ruling to the CJEU.
The core legal issues of the case were the question of the compatibility of the applicable provisions of the State Immunity Act with the right to an effective remedy under both Article 6 ECHR and Article 47 CFR, and, in case of a negative reply, the consequences that should follow for the pleas of immunity.
The Court extensively referred to the case-law of the ECtHR about State immunity from civil jurisdiction, especially as far as Embassy employment disputes are concerned (paras. 11-30). In particular, the approach of the Strasbourg Court is recalled, according to which there is a violation of Article 6 ECHR when the grant of immunity is not required by international law and it does not lie within the margin of appreciation accorded to States to determine the extent of their obligations under international law (para. 30).
Following this line of reasoning, the Court of Appeal excluded the compatibility with article 6 ECHR of Section 16(1)(a) of the State Immunity Act, a blanket provision recognizing the immunity in all cases concerning embassy or consular employment disputes, far beyond what is required by international law.
The Court of Appeal then examined the compatibility with the ECHR of Section 4(2)(b) of the State Immunity Act. This provision, giving effect to Article 5(2)(b) of the European Convention on State Immunity (Basel, 16 May 1972; ETS No.074)68, grants foreign States immunity from jurisdiction in respect to proceedings relating to a contract of employment, where the employee was neither a national of the United Kingdom, nor was habitually resident there at the time when the contract of employment was made. The Court of Appeal considers that Section 4(2)(b) is not required by international law and therefore constitutes a disproportional limitation of the right of access to justice contrary to Article 6 ECHR. Furthermore, the Court esteemed that the same Section was discriminatory on grounds of nationality and violated Article 14 ECHR.
Pursuant to Section 4(2) of the Human Rights Act, the Court therefore declared that the applicable provisions of the State Immunity Act infringed upon the ECHR.
The Court then examined whether, as argued by Ms Janah and Ms Benkharbouche, the case fell within the scope of EU law (paras. 69-74). Indeed, whilst the Human Rights Act (1998) does not allow British court to disapply a domestic provision in conflict with an ECHR right (they must instead issue a declaration of incompatibility; see point a) above), EU law requires all national courts not to apply domestic provisions conflicting with EU law provisions (thus, also Charter rights) that satisfy the requirements for direct effect.
The Court of Appeal considered that certain claimed raised by the appellants were derived from EU law measures. Although there is no express mention of any of them, the EU law measures relevant to the case are Directive 2000/43/EC of 29 June 2000 implementing the principle of equal treatment between persons irrespective of racial or ethnic origin, and Directive 2003/88/EC of the European Parliament and of the Council of 4 November 2003 concerning certain aspects of the organisation of working time.
Consequently, the Court of Appeal established that the relevant provisions of the State Immunity Act infringed upon Article 47 CFR, too. In support of this finding, it referred to the Official Explanations of the Charter to argue that, “in so far as relevant to the present case, the content of Article 47 is identical to that of Article 6 ECHR” (para. 71).
Since the case involved private citizens to third States, it could not be construed as a case involving the vertical direct effect of EU law (private citizen v. a Member State); rather, it was a matter of direct horizontal effect, which the CJEU has granted only to some EU law provisions of primary law, without, however, making clear whether additional requirements to the general ones for (vertical) direct effect must be satisfied (on this point, see the “Background issues” section above). The Court of Appeal recalled the judgments in Mangold (Case C-144/04) and Kücükdeveci (Case C-555/07), where the CJEU acknowledged the direct horizontal effect of the general principle of non-discrimination on grounds of age, now reaffirmed by Article 21(1) of the Charter.
It then observed that the CJEU has to an extent addressed the question of the capability of Charter provisions to have direct horizontal effect in its judgment in AMS (Case C-176/12), where it has held that the principle of non-discrimination on grounds of age in Article 21(1) CFR is amenable to direct horizontal effect, whereas the right to information and consultation in the undertaking guaranteed by Article 27 CFR is not.
Though admitting that, in AMS, “[t]he CJEU did not (...) go on to make it clear which rights and principles contained in the EU Charter might be capable of having horizontal direct effect, and which would not”, the Court of Appeal did not raise a reference for preliminary ruling to the CJEU; rather, it established on its own that Article 47 CFR is amenable to horizontal direct effect. In particular, it argued that, with respect to Article 47 CFR, the objection that “Article [cannot] be invoked horizontally because it [requires] specific expression in Union or national law (...) does not apply to Article 47, which does not depend on its definition in national legislation to take effect” (paras. 79-80).
Furthermore, the Court of Appeal observed that, according to its explanation, Article 47 CFR codified the case law of the CJEU acknowledging as a general principle of EU law the right to an effective remedy; this was regarded as an additional element in favour of the capability of Article 47 CFR to have direct horizontal effect (paras. 80 – 81). This circumstance allowed the disapplication of Sections 4(2)(b) and 16(1)(a) of the State Immunity Act, in relation to the claims of both claimants falling within the scope of EU law.