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Exclusive jurisdiction clause was unenforceable
Nogueira v Crewlink Ireland Ltd
An exclusive jurisdiction clause in Ryanair cabin crew contracts, which stipulated that only the Irish courts had jurisdiction with regard to any claims made by Ryanair’s employees, was not enforceable.
At the end of most contracts of employment, there’ll be a boilerplate clause such as ‘the courts of [country name] shall have exclusive jurisdiction to settle any dispute or claim arising out of this agreement’ – this is an exclusive jurisdiction clause. However, European law (specifically the 2001 Brussels Regulation) can have an impact here, especially where employees have a connection with another EU member state.
Ryanair cabin crew brought various employment claims in the Belgium courts. Their contracts of employment were in English and stated, via an exclusive jurisdiction clause, to be subject to Irish law. But their home base was Charleroi airport (near Brussels) and they were contractually required to live less than an hour from the airport. The Belgium courts, unsure whether they had jurisdiction to hear the employees’ claims, referred the case to the ECJ.
The ECJ had little hesitation in holding that the exclusive jurisdiction clause was unenforceable and that the Belgium courts did have jurisdiction to hear the claims. An employee is entitled to bring a claim against their employer before either the courts of the member state in which the employer is domiciled or in the place where the employee habitually carries out their work. The location of the ‘home base’ referred to in the contracts of employment was a relevant factor in determining where the employees habitually carried out their work, alongside other factors including the place where they receive instructions concerning their tasks, and from which the work is organised, and the place where they return to after completion of their tasks.
Link to judgment: http://www.bailii.org/eu/cases/EUECJ/2017/C16816.html
Any company whose employees are based elsewhere in Europe should take careful note of this case – especially those employed in countries such as France and Germany which give much more protection to their workers. In the UK, the law says that any person ordinarily employed within the UK is entitled to bring employment-related claims in the UK tribunals, this extends further than Europeans and so even though their contracts may say that the US courts have exclusive jurisdiction to settle any disputes or claims, they could still bring employment-related claims here, which is very helpful if you are American as generally employment is at will in the US.