The Royal Embassy of Saudi Arabia (Cultural Bureau) v Costantine [2025] UKSC 9 (06 March 2025)

An employee of the Saudi Arabian Cultural Bureau was dismissed after whistleblowing. She brought employment claims. The Supreme Court held that the Embassy had state immunity because her employment served sovereign, not commercial, purposes and fell under specific immunity rules for diplomatic missions.

Facts

The respondent, Ms Amal Costantine, a Lebanese national, was employed by the appellant, the Royal Embassy of Saudi Arabia (Cultural Bureau), in London from September 2011. Her role was as an assistant to a cultural attaché. In 2018, her employment was terminated. Ms Costantine brought claims in the Employment Tribunal for unfair dismissal and detriment on the grounds of making protected disclosures (whistleblowing). The Embassy asserted that it was entitled to state immunity from the jurisdiction of the UK courts under the State Immunity Act 1978 (“SIA”).

Issues

The central legal issue was whether the Embassy was immune from Ms Costantine’s employment claims under the SIA. This required the Supreme Court to consider the interplay between several provisions of the Act:

1. Whether the employment contract constituted a “commercial transaction” under section 3(1)(a) and 3(3)(a) of the SIA, which would remove immunity.
2. If not, whether the general exception to immunity for contracts of employment made in the UK (section 4 of the SIA) applied.
3. The effect of section 16(1)(a) of the SIA, which specifically re-imposes immunity for proceedings concerning the employment of members of a diplomatic mission, unless the employee is a UK national and resident at the time of the contract.

Judgment

The Supreme Court unanimously allowed the appeal, concluding that the Embassy was entitled to state immunity. Lord Leggatt gave the sole judgment.

The ‘Commercial Purposes’ Exception

The Court rejected the Court of Appeal’s reasoning that the employment contract itself was a ‘commercial transaction’. It held that the focus should not be on the nature of the contract in isolation, but on the purpose of the employment. The employment of an individual to assist in the performance of a state’s sovereign functions cannot be considered ‘commercial’.

On a proper interpretation of the SIA, the question of whether a contract of employment is a “commercial transaction” depends on the nature of the work done by the employee. As Ms Costantine was employed as an administrative assistant to a diplomatic agent engaged in sovereign activity, her employment was in the exercise of sovereign authority. The exception in section 3 of the SIA therefore does not apply.

The Diplomatic Mission Exception

The Court then analysed the relationship between the general employment exception in section 4 and the specific rule for diplomatic missions in section 16. Lord Leggatt concluded that these sections are mutually exclusive. Section 16 provides a specific and self-contained code for employment disputes relating to diplomatic missions, reflecting their special status in international law. Since Ms Costantine was employed for the purposes of a diplomatic mission, section 16 applied, and the general exception in section 4 did not.

It follows that sections 4 and 16(1) of the SIA are mutually exclusive. Where a proceeding relates to employment by a state for the purposes of a diplomatic mission, section 16(1) applies and section 4 does not. As Ms Costantine was not a UK national when the contract was made, the exception for such employment in section 16(1)(a) does not apply. The Embassy is therefore immune from the jurisdiction of the UK courts in this case.

The court thus restored the original decision of the Employment Tribunal.

Implications

This decision provides significant clarity on the scope of state immunity under the SIA 1978, particularly in the context of employment at diplomatic missions. It confirms that the ‘commercial purposes’ exception is unlikely to apply to any staff whose work supports the sovereign functions of a mission. The judgment reinforces the primacy of the specific immunity regime for diplomatic missions outlined in section 16 over the more general employment exceptions. As a result, many non-UK nationals working for diplomatic missions in the UK will find themselves unable to bring employment law claims in UK tribunals, highlighting the tension between the principle of state immunity and access to justice for employees.

Verdict: The appeal was allowed. The Embassy is immune from the jurisdiction of the UK courts in respect of Ms Costantine’s claims.

Source: The Royal Embassy of Saudi Arabia (Cultural Bureau) v Costantine [2025] UKSC 9 (06 March 2025)