In principle, parties to a contract have autonomy to choose the law that applies to that contract and to choose the courts that have jurisdiction to determine disputes arising from that contract. In certain instances, however, such autonomy is limited. A case in point is employment.
In an employment relationship, the employer is not at liberty to impose a law of contract that prejudices the rights of the employee. The Rome I regulation of 2008 establishes rules for determining the law applicable to international employment contracts that aim on the one hand in asserting the freedom of choice of the contracting parties, while at the same time protecting the employee as the weaker party to the contract.
In terms of this regulation, the employee will, notwithstanding the choice of law agreed on contract, be protected by the more generous provisions of the law of the place where the work is habitually carried out, or failing that, of the place where the employee was engaged, or if the contract is more closely connected with another country, the law of that country.
When it comes to determining which courts have jurisdiction to hear an employment dispute, the recast Brussels I regulation of 2012 leaves, in practice, no flexibility to the parties to choose the courts to which disputes may be referred. Disputes brought by an employer may only be raised in the courts where the employee is domiciled.
The employee has a choice to sue the employer at the latter’s domicile, or at the place where the employee habitually carries out his work, or where the place of habitual work is not situated in any one country, the place where the business which engaged the employee is or was situated. The only way to contract a choice of law clause in employment matters differently from the regulation’s rules, is only after a dispute has arisen or if the agreement allows the employee to bring proceedings in courts other than the one that would otherwise be available for the employee under the regulation.
A referral to the Court of Justice of the European Union (CJEU) was made within the context of an employment dispute that was brought before the Belgian courts. A number of cabin crew brought actions before the Belgian courts against their employer. Their employment contract designated Charleroi Airport, Belgium as their home base, and they started and ended their day’s work there. For this reason, the employees insisted that their employer was bound by Belgian employment laws, and that the Belgian courts had jurisdiction in case of disputes. The air hostesses and stewards had different EU nationalities: some Portuguese, some Spanish and others Belgian. Ryanair, their employer, was established under Irish law and had its registered office in Ireland. Ryanair argued that the Belgian courts had no jurisdiction and that the Irish courts were competent to determine the claims brought by the cabin crew.
The Belgian courts asked guidance from the CJEU on whether Belgium was the correct jurisdiction for the employees to bring a claim when they perform their duties in different member states.
Judgments delivered by the CJEU are preceded by the opinion of the Advocate General. In this case, the matter was referred to Advocate General Henrik Saugmandsgaard. The Advocate General’s role is to give independent opinions before the CJEU considers its judgment. His opinion is not binding on the court.
Basing himself on EU law, the Advocate General opined that the nationality of the aircraft on board which air hostesses and stewards provide their services is not a material element to be considered when determining the place where those employees habitually perform their work.
On the other hand, he argued that the court having jurisdiction is the court of the place where or from which the employee principally carries out his obligations. That place is determined by factors such as the place where the worker starts and ends his working days, where he is given instructions from his employers and organises his working day, where he is contractually required to reside, where an employer’s office is situated, and where he must attend if he is unfit for work or in the event of disciplinary problems.
While maintaining that the national court seized of the case is required to apply those criteria to the particular facts of the case before it, the Advocate General argued that the factors in this case pointed to the Belgian courts.
Dr Josette Grech is adviser on EU law at Guido de Marco & Associates
jgrech@demarcoassociates.com