Government of the State of Kuwait v S Mohamed: EAT addresses state immunity and personal injury exceptions

The Employment Appeal Tribunal has dismissed an appeal by the Government of the State of Kuwait concerning the scope of state immunity under the State Immunity Act 1978 in employment discrimination cases involving claims for psychiatric injury.

Mr Mohamed, a British citizen and medical doctor, was employed by Kuwait at its diplomatic mission in London from 2009 until his dismissal on 20 May 2020. He worked at the Kuwaiti Health Office, initially as an in-house doctor and later as a medical auditor. During the first COVID-19 lockdown in March 2020, aged 75 and suffering from prostate cancer, diabetes and hypertension, Mr Mohamed remained at home to shield himself. When told to return to the office, he was subsequently dismissed on grounds that he had reached the compulsory retirement age of 70.

Mr Mohamed brought claims for age, sex and disability discrimination, harassment and victimisation under the Equality Act 2010, including claims for personal injury in the form of depression caused by his treatment and dismissal. Kuwait claimed state immunity.

The preliminary hearing decision

At a preliminary hearing before Employment Judge Brown, the tribunal found that Mr Mohamed had been employed in the exercise of sovereign authority, meaning the exception to state immunity in section 4 of the SIA (relating to contracts of employment) did not apply due to section 16(1)(aa). However, the tribunal held that section 5 of the SIA, which removes immunity for proceedings in respect of personal injury, applied to his claims. Accordingly, Kuwait was not immune from Mr Mohamed's personal injury claims arising from discrimination and harassment.

Following liability and remedies hearings, Mr Mohamed was awarded £332,590.76 in compensation.

The appeal grounds

Kuwait appealed on two grounds. Ground 1 contended that section 5's personal injury exception does not apply to employment-related claims covered by sections 4 and 16(1). Ground 2 argued that section 5 does not cover psychiatric injury, only physical injury.

Previous EAT authorities

Three previous EAT decisions had held that section 5 applies to personal injury claims arising from employment, even where sovereign authority is involved: Military Affairs Office of the Embassy of the State of Kuwait v Caramba-Coker (2003), Federal Republic of Nigeria v Ogbonna [2012] ICR 32, and Royal Embassy of Saudi Arabia (Cultural Bureau) v Alhayali [2023] EAT 149. However, when Alhayali reached the Court of Appeal, Bean LJ stated obiter that these decisions were wrong, though his comments were not necessary to the decision since the Court allowed the appeal on different grounds.

The Lock principle

Mr Justice Cavanagh examined the principle from British Gas Trading v Lock [2016] ICR 502, which establishes that whilst the EAT is not bound by its previous decisions, it will generally follow them unless they were per incuriam, manifestly wrong, inconsistent with other decisions, or there are exceptional circumstances.

Kuwait argued that either this principle does not apply to state immunity cases, or that the previous EAT decisions were manifestly wrong, particularly in light of Bean LJ's obiter comments. Kuwait submitted that the SIA must be interpreted consistently with customary international law, which grants immunity for employment claims involving sovereign authority regardless of whether personal injury results.

The EAT's analysis

Mr Justice Cavanagh held that the Lock principle does apply to state immunity cases. Whilst procedural rules may not apply with the same rigour in such cases, the question of statutory interpretation remains subject to normal principles. The doctrine of stare decisis applies to state immunity issues—as demonstrated by the parties' agreement that the EAT was bound by the Court of Appeal's decision in Shehabi v Bahrain [2024] EWCA Civ 1158 on Ground 2.

The judge found that the previous EAT decisions were not per incuriam. The arguments about interpreting the SIA consistently with international law had been advanced and considered, particularly in Ogbonna. No relevant statutory provision or authority had been overlooked.

On whether the decisions were manifestly wrong, Mr Justice Cavanagh conducted a detailed analysis of the arguments both ways. In favour of Kuwait's position, he noted that section 17(4A) makes clear that references to employment proceedings include statutory employment claims, suggesting Parliament intended state immunity to apply to all such claims. The statutory scheme in sections 4 and 16 appears carefully structured, and it seems surprising that claiming personal injury could sidestep this scheme.

However, he identified equally strong arguments supporting the previous EAT decisions. Section 5 uses plain language stating that states are not immune "as respects proceedings in respect of personal injury". Parliament could have stated that section 16(1) exceptions apply to section 5 as well as section 4, but did not do so—either when the SIA was enacted or when section 16 was amended in 2023, by which time the Caramba-Coker and Ogbonna decisions were known. Section 16(2), concerning visiting armed forces, expressly applies to "this Part of this Act", covering both sections 4 and 5, showing Parliament knew how to extend section 16 provisions to section 5 when intended.

The Court of Appeal in Shehabi had emphasised that section 5's plain language is the primary source for ascertaining its meaning, and that the SIA's exceptions should not be interpreted restrictively. The judge noted that extensive and complicated argument on the point indicated the previous rulings were not manifestly wrong.

Decision

Mr Justice Cavanagh dismissed the appeal on Ground 1, holding that he was bound by the previous EAT decisions applying the Lock principle. He added, however, that his own view was that Bean LJ's analysis was correct, and that employment claims fall within the scheme of sections 4 and 16 even where compensation is sought for personal injury. Nevertheless, the arguments were very finely balanced and not so clear as to render the previous decisions manifestly wrong.

Ground 2 was dismissed as the parties agreed the EAT was bound by the Court of Appeal's decision in Shehabi that "personal injury" in section 5 includes psychiatric injury. That issue is subject to a pending Supreme Court appeal.

The judge indicated he would be minded to grant permission to appeal, noting that the conflict of judicial opinion on Ground 1 required Court of Appeal resolution, whilst Ground 2 should be kept alive pending the Supreme Court's decision in Shehabi.

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