Employment contract jurisdiction: where does an employee habitually work?

What determines the jurisdiction of employment contracts where employees work in multiple countries? The ECJ has given its decision in a case concerning mobile workers in the air transport sector.

28 September 2017

The Court of Justice of the European Union (ECJ) has ruled that the employment contracts of cabin crew fall within the jurisdiction of the country where the employee habitually carries out their work and that this cannot be equated with the concept of "home base" or the nationality of the aircraft.

Jurisdiction of employment contracts

An employment contract will often state the law of the country which will apply to the contract and purport to confer jurisdiction on the courts of the same country to determine a dispute. However, in the EU, under the 2001 Brussels Regulation and the Recast Brussels Regulation, special rules apply to employment contracts.

Subject to certain exceptions, an employee may bring a claim in the courts of the EU member state:

  • in which the employer is domiciled; or
  • where, or from where, the employee habitually carries out their work (or the last place where he did so); or
  • if the employee does not or did not habitually carry out their work in any one country, in the courts for the place where the business which engaged the employee is or was situated.

The question before the ECJ is what is the correct jurisdiction for an employee to bring a claim when they perform their duties in multiple member states?

The case

Nogueira and others v Crewlink Ltd C-168/16; Moreno Osacar v Ryanair, formerly Ryanair Ltd C-169/16

Six cabin crew employed by Crewlink and assigned to work for Ryanair out of Charleroi airport in Brussels, brought claims in the Belgian courts for unpaid wages, overtime pay and severance pay. The employers argued that the Belgian courts had no jurisdiction and that the Irish courts must determine the claims. 

Both Crewlink and Ryanair are Irish companies and their registered office is in Ireland. The employment contracts of the cabin crew were in English and were stated to be governed by Irish law and conferred jurisdiction on the Irish courts. However, the employment contracts stated that the employees' home base, where they would start and finish work, was Charleroi airport in Brussels and the employees were required to live within an hour of the airport.

At first instance the labour court in Charleroi held that the Belgian courts did not have jurisdiction to hear the claims. The claimants appealed and the Mons Higher Labour Court in Belgium referred the question to the ECJ as to how "the place where the employee habitually carries out his work" should be interpreted for mobile workers in the international air transport sector.

ECJ decision

The ECJ held that the assessment of the place where the employee habitually carries out their work is the place where, or from which, the employee actually performs the essential part of their duties vis-à-vis their employer. This can be determined by a number factors, including:

  • the place from which the employee carries out their transport-related tasks
  • the place where they return after their tasks, receives instructions concerning their tasks and organises their work
  • the place where their tools are to be found.

The ECJ acknowledged that the concept of "home base" (under the Civil Aviation Regulation) may be a factor that could be taken into account in determining the place the employee habitually carries out their work because this is where the employee starts and ends their day.

However, the fact that the employees carried out their work on Irish aircraft was irrelevant and the clause in the employment contracts which said that it was governed by Irish law and the Irish courts had jurisdiction to resolve disputes were unenforceable because it sought to prevent the employees from bringing proceedings before the courts that they were entitled to under the law.

The ECJ held that exclusive jurisdiction clauses can only be relied on where they are agreed between the parties after the dispute has arisen.

Comment

Although this case specifically relates to the international air transport sector, the decision is in line with other case law on jurisdiction. Employers with employees who work in multiple member states should consider the implications for their contracts of employment as the effect of this decision may mean that a number of jurisdiction clauses in employment contracts are unenforceable if they prevent an employee bringing a claim before the courts of the country where they habitually carry out their work.

If you would like more information, or specific advice, please contact Chris Seaton, Senior Partner, or your usual Burges Salmon contact.

Key contact

Chris Seaton

Chris Seaton Senior Partner

  • Senior Partner
  • Employment
  • Partnerships

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