Employment case against Ryanair can be tried by Norwegian courts, even though the employment agreement states otherwise

The Irish low-fare airline Ryanair’s employment practices were recently challenged by the Norwegian courts.

On 20 June 2014, the Appeals Selection Committee of the Supreme Court of Norway unanimously rejected an appeal from Ryanair, claiming that an unfair dismissal lawsuit against Ryanair must be tried in Ireland, where the company is registered, and not in Norway, where the plaintiff lives and was located when she was dismissed. The ruling may have repercussions for Ryanair’s operations in Europe. It is also a reminder to other European employers that the contractual freedom may be limited in cross border employment relationships, with regard to the jurisdiction of national courts and choice of national employment law.

The case concerns an Italian citizen, Alessandra Cocca, who signed an employment agreement with the Irish registered company Crew Link Ireland Ltd. as a “Customer Services Agent” / “Cabin Crew” on 28 March 2012. Cocca was at the same time hired to Ryanair Ltd. for three years, commencing from 6 April 2012. As she would perform her duties as cabin crew on Ryanair’s aircrafts, an Irish registered company, the employment agreement stated that her employment was based in Ireland. The agreement also stated that Cocca would be located at Rygge Airport in Norway and that she had to live within one-hour traveling time from the airport. The agreement further stated that Irish law would govern the employment relationship between Crew Link Ireland Ltd. and Cocca, and that the Irish courts would have jurisdiction in matters relating to the contract. On 30 January 2012, Cocca was dismissed on the grounds that she had not passed the trial period. On 4 April 2013, Cocca issued a writ against Ryanair, claiming that she was permanently employed by Ryanair. Since then, Ryanair has pleaded for dismissal, referring to the agreement that states that only Irish courts have jurisdiction. Cocca, on the other hand, has claimed that she also has the right to try the case in a Norwegian court.

The ruling of 20 June 2014 (HR-2014-1273-U) is the fifth court decision following the lawsuit, and the second ruling from the Appeals Selection Committee of the Supreme Court. The courts have so far only considered whether Norwegian courts have jurisdiction. Except for the first ruling from Moss District Court, both the Borgarting Court of Appeal and the Supreme Court have granted Cocca access to the Norwegian courts.

The jurisdiction of the Norwegian courts is governed by the Norwegian Dispute Act, which in Section 4-5 sets down the rights of a plaintiff to elect an alternative legal venue than the defendant’s main legal venue. Paragraph four states that an action by an employee against his employer for claims arising out of an individual employment relationship may be brought “at the place of work or at the place where the employee normally performs his work”.

The provision is modeled from the Convention on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters, concluded by the EU, Switzerland, Denmark, Iceland and Norway in Lugano on 30 October 2007 (the Lugano Convention). The Lugano Convention serves as a parallel agreement to the Council Regulation (EC) 44/2001 of 22 December 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (Brussels I-regulation). The Lugano Convention applies as Norwegian law, cf the Disputes Act Section 4-8, and supersedes any conflicting national rules. Article 19 in the Lugano Convention states that an employer domiciled in a State bound by the Convention may be sued either in the courts of the State where he is domiciled (in this case in Ireland) or in another State bound by the Convention. The right to elect an alternative legal venue is limited to: (a) in the courts for the place where the employee “habitually carries out his work” or in the courts for the last place where he did so, or (b) if the employee does not or did not habitually carry out his work in any one country, in the courts for the place where the business which engaged the employee is or was situated. Further, Article 21 states that Article 19 may be departed from only by an agreement on jurisdiction which is entered into after the dispute has arisen, or which allows the employee to bring proceedings in courts other than those indicated in Article 19. The Lugano Convention Articles 19 and 21 correspond to the language in the Brussels I-regulation Article 19 and 21.

The general interpretation of the Norwegian Dispute Act Article 4-5 and the Lugano Convention Article 19 litra a, was considered by the Appeals Selection Committee of the Supreme Court in its first ruling on 5 December 13 (HR-2013-2522-U / Rt-2013-1589). The Appeals Selection Committee referred introductorily to the general interpretation made by the Borgarting Court of Appeal in its decision of 16 August 13 (LB-2013-123040).

In its ruling, the Borgarting Court of Appeal stated that, when interpreting the Lugano Convention, regard shall be had to the EU Court decisions and national court decisions on parallel provisions, with special emphasis on the EU Court’s interpretations of parallel provisions of the Brussels I-Regulation. Parallel provisions concerning choice of law should also be taken into consideration, in the present case, the EU Court decisions regarding the Rome Convention, followed by the Rome I-Regulation rules on choice of law. The Rome I-Regulation Article 8 paragraph 2 also states that the contract shall be governed by the law of the country “in which or, failing that, from which the employee habitually carries out his work in performance of the contract”. The Borgarting Court of Appeal went through the EU Court cases C-383/95 Rutten, C-29/10 Koelzsch and C-384/19 Voogsgeerd, and consequently concluded the following:

«The Court of Appeal considers that it should carry out a comprehensive assessment, where the special conditions in aviation are taken into account, and where the employee’s center of work activity is decisive, and not factors as formal relationships or employer association.”

Although most of Cocca’s work activity as Cabin Crew was conducted in international airspace, the Borgarting Court of Appeal found that this was not decisive when considering where Cocca’s center for work activity was located. The Court of Appeal found that Rygge Airport was still the center for her work activity, and emphasized that Cocca received an extra salary for being located in Norway, that the residence requirement of living a maximum of one hour from the airport provided a connection to the area, that she started and ended her work at the airport, that she, to some extent, had defined tasks on the ground at the airport and that she also had standby duties that forced her to stay in the area.

The Appeals Selection Committee of the Supreme Court endorsed the general interpretation made by the Borgarting Court of Appeal. It also emphasized that, even though the court must carry out a comprehensive assessment, the place where the employee is located and his/her work meeting point are of great significance to the assessment. The Appeal Selection Committee concluded, however, that the case had to be retried by the Borgarting Court of Appeal due to mistakes in the Court of Appeal’s decision with regard to the assessment of the extent of Cocca’s tasks on the ground at Rygge Airport. In its second ruling of 5 March 2013 (LB-2013-202882), the Borgarting Court of Appeal mainly affirmed that the mistake did not influence its conclusion, and thus maintained that Norwegian Courts have jurisdiction. The decision was again appealed by Ryanair to the Supreme Court, but was rejected by the Appeals Committee without any further justification.

By emphasizing that factors such as formal relationships and employer association are not decisive, the Supreme Court has rejected the approach taken by the Moss District Court in the very first court decision. The district court came to the conclusion that the Norwegian courts do not have jurisdiction, after emphasizing that Cocca is an Italian citizen without any connection to Norway other than living in the country temporarily, that both Crew Link and Ryanair are registered Irish companies, that Cocca paid taxes to Ireland, that she was a member of the Irish Insurance Scheme, that she had Irish private insurances, that her salary went into an Irish bank account, that her instructions were given from Ryanair in Ireland, that her contract stated that Irish courts were the applicable legal venue and Irish law the choice of law, and that Cocca was working most of the time on Ryanair’s airplanes, which according to the Chicago Convention on International Civil Aviation of 7 December 1947 is to be regarded as Irish territory. After the Appeals Selection Committee’s rulings, it now seems quite clear that such factors will have little significance on the assessment in future Norwegian court cases.

The case will now return to the Moss District Court, where the choice of law will be considered. It is probably not far-fetched to expect that Norwegian employment law will be deemed applicable, especially after the statements from the Borgarting Court of Appeal, that case-law regarding choice of law is of significance when considering the jurisdiction of national courts, and vice versa.