By Pia Oppel and Julia Fioretti
LUXEMBOURG/BRUSSELS (Reuters) - Ryanair lost an EU court battle on Thursday in which the airline had sought to continue forcing cabin crew based outside Ireland to take their disputes to Irish courts, in a case with implications across the low-cost airline sector.
The European Court of Justice in Luxembourg ruled in favor of cabin crew based at the Irish carrier's Charleroi airport in Belgium on the question of which court should decide on their complaint. The employees took the airline to a local court, believing Belgian law would be more favorable to them.
Ryanair argued that Irish courts had jurisdiction over their Irish contracts. But a Belgian court in Mons had requested the ECJ's ruling on whether its own judges had jurisdiction.
"The Court (of Justice) points out first of all that, as regards disputes related to employment contracts, the European rules concerning jurisdiction are aimed at protecting the weaker party," the Luxembourg-based ECJ said in a statement. "Those rules enable inter alia an employee to sue his employer before the courts which he regards as closest to his interests."
Low-cost carriers such as Ryanair and easyJet have bases all over Europe, including in France, Spain, Italy and Germany, where both planes and crews are stationed.
This means crews can return to their home base each night, allowing the airlines to avoid costs involved with overnight rest stops.
Ryanair said the ruling would not add to its costs. Its pilots are typically employed on contracts via third-party agencies, while easyJet uses local labor contracts.
The Court said the place where a cabin crew's aircraft is stationed should also be taken into account when determining which court had jurisdiction.
Philip von Schoeppenthau, Secretary General of the European Cockpit Association, called the ruling a "landmark" decision that is a "ray of light for the thousands of pilots and cabin crew across Europe who have struggled to find legal protection at the place where they actually work on a daily basis, rather than being forced to seek judicial redress in Ireland".
Schoeppenthau said the Court's ruling meant all cabin crews in Europe can derive their rights and applicable law from their "Home Base" as a general rule.
RYANAIR SEES NO CHANGE TO IRISH CONTRACTS
Ryanair said it welcomed the ruling for recognizing that the home base of the employee should not be the sole factor in determining which court can hear disputes on labor issues.
"We do not believe this “Mons” ruling will in any way alter our Irish contracts of employment or the union rights which all of our people enjoy under the protection of the Irish Constitution," Ryanair Chief People Officer Eddie Wilson said.
Michael O'Leary, the company's Chief Executive, said in Berlin the ruling could give the unions more opportunity to take the airline to court or "challenge whatever kind of provisions we provided in Ireland but ultimately, they cannot and will not be changing the Irish contracts or the structure of the Irish contracts."
"This won't change Ryanair's cost base by one cent," O'Leary said.
The crew involved in the case had employment contracts drawn up under Irish law which said their work was to be regarded as being carried out in Ireland since they were working on Irish-registered aircraft.
But Charleroi airport in southern Belgium was designated as their base, meaning they started and ended their working days there and had to reside within an hour of that airport.
Ryanair said that Ireland had adopted all EU rules on employment rights and in some cases offered better protection than other EU countries.
The case will now go back to the Belgian court, which will make a final decision on the matter.
(Additional reporting by Victoria Bryan in Berlin; Editing by Alastair Macdonald, Edmund Blair and Susan Thomas)