Monday 23 April 2018

Ryanair insists European court ruling does not change status quo of its crew members

Investors worry that the airline’s employment model could at least now be subject to more scrutiny. Stock image
Investors worry that the airline’s employment model could at least now be subject to more scrutiny. Stock image
John Mulligan

John Mulligan

Ryanair has insisted that a ruling by the European Court of Justice (ECJ) this morning does not change the status quo of its thousands of crew members who work for the carrier under Irish contracts.

But shares in the carrier slumped more than 4pc in Dublin before rallying for a 2.6pc decline, as investors worry that the airline’s employment model could at least now be subject to more scrutiny.

The ECJ ruled this morning in case related to six Belgium-based Ryanair workers, that a jurisdiction clause that sought to prevent them from bringing proceedings before courts which do have jurisdiction under EU legislation in the air passenger transport sector, was not enforceable against those employees.

It effectively means that Ryanair crew can now have disputes regarding employment contracts held in the country where they habitually carry out their work, such as a Ryanair base, rather than in Ireland, the country under which the contracts are drafted.

The case had been referred to the ECJ by the Mons Higher Labour Court in Belgium.

In a dispute, six employees of Crewlink, which provides staff to Ryanair, and of Ryanair itself, argued that the firms had to comply with and apply the provisions of Belgian law and that the Belgian courts had jurisdiction to adjudicate on their claims. The six employees brought proceedings before the Belgian courts in 2011.

Ryanair chief executive Michael O’Leary
Ryanair chief executive Michael O’Leary

All the six crew members’ employment contracts were drafted in English, subject to Irish law, and included a jurisdiction clause providing that the Irish courts had jurisdiction in disputes.

 In those contracts, it was stipulated that the work of the employees concerned, as cabin crew, was regarded as being carried out in Ireland given that their duties were performed on board aircraft registered in that Member State, the ECJ said.

Those contracts nevertheless designated Charleroi airport (Belgium) as the employees’ ‘home base’. Those employees started and ended their working day at that airport, and they were contractually obliged to reside within an hour of their ‘home base’.

The ECJ said yesterday that an employee’s ‘home base’ amounts to a “significant indicator” to determine from the place from where an employee habitually carries out their work.

Ryanair said this morning that the ECJ had found in its favour, by “rejecting the CTC Union argument that the home base should be the sole determinant of what court jurisdiction cane hear disputes on labour issues”.

It added: “This ECJ decision does not change the status quo of Irish contracts of employment for Ryanair crew based across Europe. Ryanair will continue to employ its crew on Irish contracts of employment, and this decision only updates the criteria for assessing the jurisdiction of national courts to hear legal cases locally and does not alter the law applicable to the contract, which is determined by the Rome I regulation (593/2008).”

“Irish legislation has adopted all EU directives on employment rights which are also covered in Ryanair contracts of employment and in some cases, offers better protection than some EU countries,” Ryanair insisted.

The International Transport Workers’ Federation (ITF) and the European Transport Workers’ Federation (ETF) welcomed the ruling.

ITF general secretary Steve Cotton said the ruling "is a defeat for Ryanair and a victory for workers’ rights".

"It upholds the fundamental principle of protecting mobile workers in aviation by ensuring that they can hold their employer to account in the country from which they genuinely discharge their duties – not in a nation which they may never have visited and whose courts are foreign and based hundreds of miles from home and place of work."

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