The case of the day is Dahman v. Embassy of the State of Qatar (D.D.C. 2018). El-Sayed Dahman, an Egyptian national who lived in Virginia, was employed by the Qatari Embassy as its chief accountant. When he turned 65, the Embassy discharged him. There was no question that his age was the reason for the discharge—both the Ambassador and the Director of Human Resources said so in writing. Qatar evidently had a policy of firing employees when they reached what it regarded as the retirement age. Dahman sued under the Age Discrimination in Employment Act. Qatar defaulted, and on a motion for default judgment, the court had to determine whether Qatar had foreign sovereign immunity.
The easy question in the case was whether Dahman’s employment was “commercial” within the meaning of the FSIA’s commercial activity exception. The correctly held that it was. The D.C. Circuit has the leading case on this issue: El-Hadad v. United Arab Emirates, 496 F.3d 658 (D.C. Cir. 2007). El-Hadad first asks whether the employee is a “civil servant” of the foreign state. If so, then the employment is not commercial. If the employee is not a civil servant, the court goes on to look at whether the employee is exercising “powers that can also be exercised by private citizens,” using a multi-factor test. I am not going to review the details of the application of the test: while Dahman was closer to the line than some, the factors weighed against Qatar.
There was, though, a more interesting question lurking in the case, though one that was not really litigated (because Qatar had defaulted, the judge reached his conclusions without the benefit of its views). It wsan’t as though there were some rogue employee in the Embassy who was guilty of age discrimination for which Qatar was to be held liable. It was the policy of Qatar to discriminate on the basis of age in a way that is illegal under US employment law. The commercial activity exception to FSIA immunity applies whenever the action is “based on” the foreign state’s commercial activity in the United States. Was this case “based on” Dahman’s employment? Or was it “based on” Qatar’s policy, which presumably was made in Qatar and which was, perhaps, a legislative decision rather than a commercial activity?
In light of the text of the FSIA itself, it seems to me the answer has to be that the action is based on the employment, not on the policymaking. The reason: the FSIA itself provides (28 U.S.C. § 1603(d)) that whether an act or omission is commercial is determined with reference to its nature, not its purpose. What did Qatar do? It discriminated on the basis of age, just as any private employer might. Why did Qatar do it? Because it had a policy—but that’s just to point to the purpose of the act, which is precisely what the FSIA forbids.
We can also consider the consequences if this weren’t the rule. A state could be liable, say, for the racially discriminatory actions of a rogue supervisor who refused to hire an African American on the basis of race, but not liable for enforcement of an explicitly racist hiring policy. A state that was hard up for money and that issued a decree postponing all wages of government employees for six months would have no liability under wage and hours law. And so forth.
You might wonder whether foreign governments ought to have the latitude to violate the law in this way with respect to their own embassy employees. If we are talking about non-commercial employees, with diplomatic, consular, governmental, or military duties, then I think that’s right. (Or at least the foreign state would be immune from claims brought by such employees in US courts, leaving aside the question whether the foreign state is subject to the jurisdiction of the United States and the relevant state (or the District of Columbia) to prescribe). But the interesting cases involve non-official, non-governmental employees—typically low level Americans (or at least non-nationals of the foreign state in question) who are hired to do the same job they might do for any private employer. With respect to those employees, the foreign state acts as a private employer, and it should enjoy no special exemptions from the reach of the US courts to enforce the laws ordinarily applicable to all employers.