Paid annual leave for part-time seafarers – how a new ruling affects members

Nautilus head of legal services Charles Boyle discusses an important ruling by the Employment Appeal Tribunal on 'annual leave with pay' for part-time seafarers

In the case of Hayford & Biddle v P&O Ferries (Jersey) Ltd, the Employment Appeal Tribunal (EAT) handed down an important ruling on how paid annual leave for part-time seafarers is to be calculated, in assessing whether it complies with the 'annual leave with pay' provisions within the Maritime Labour Convention, 2006.

Although their employment arrangements changed from time to time, Ms Hayford and Mr Biddle worked for much of the relevant time as part-time assistant stewards on the Spirit of Britain, a UK ferry sailing between Dover and Calais in the Short Sea sector. The case involved several issues, but the key one was whether the claimants had – taking into account the relevant statutory contractual provisions – been accorded 38 days paid annual leave.

Also relevant were the terms of the collective agreements between P&O and the National Union of Rail, Maritime and Transport Workers (RMT), which supported the case.

In a detailed judgment, consisting of 112 paragraphs over 43 pages, the EAT ruled in the affirmative.

The legislative background is complex, involving paid annual leave for seafarers at International Labour Organization (ILO), European Union and UK levels.

In summary:

• the EU Council Directive 1999/63/EC (updated to comply with the MLC) concerning the Agreement on the organisation of working time of seafarers concluded between ETF and ECSA, which provides: 'The annual leave with pay entitlement shall be calculated on the basis of a minimum of 2.5 calendar days per month of employment and pro rata for incomplete months.'
• the ILO's MLC provides: 'the annual leave with pay entitlement shall be calculated on the basis of a minimum of 2.5 calendar days per month of employment.'

The UK's Merchant Shipping (Hours of Work) Regulations 2002, as amended by the Merchant Shipping (Maritime  Labour  Convention) (Hours of Work) (Amendment) Regulations 2014 provided:

• An employed seafarer is entitled to paid annual leave that is to be calculated on the basis of two and half days for each month of employment in the leave year and pro rata for incomplete months
• An employed seafarer is entitled to additional paid leave of eight days in each leave year and pro rata for incomplete years. [This further eight days is in recognition of UK public holidays]

The MLC-amended 2002 Regulations were in force at the relevant time but reflect the above provision in identical terms.

The EAT ruling dealt firstly with the annual leave aspect, and, secondly, with the pay aspect, and ruled:

• the entitlement to 'two and half days for each month of employment in the leave year and pro rata for incomplete months' meant what it said: it applies to 'each month of employment' (not to the proportion of the month worked by a part-time worker): part-time workers were entitled to 38 days paid leave, as were full time workers: however, applying Russell v Transocean International Resources Limited (which held that offshore workers alternate two-weeks off roster counted as annual leave), the time the claimants spent ashore off-roster by far exceeded that minimum entitlement.
• On the pay issue, as their contractual terms and conditions expressly stated that their salary included annual leave pay (in MLC language, the pay for annual leave was fully 'consolidated' into their salary) their regular monthly salary instalments, which included 'rolled-up' meant they received their due pay for all their annual leave days, including the 38 days of statutory entitlement.

As the judge put it, the claimants '…had received their statutory entitlement to holiday pay, in respect of 38 days' statutory  leave  per annum,  which  they had  both accrued and been accorded.'  

To summarise, the ruling gives guidance, not only on leave entitlement, but also on how that entitlement may be accorded.

All seafarers (full-time and part-time) on UK ships are entitled to 38 days paid annual leave per annum; the time spent off duty (which is even more for part-time seafarers) counts as their annual leave; if their seafarer employment agreement states that their salary includes pay for annual leave, then that complies with the legislation.

Responding to the verdict, Nautilus head of industrial Micky Smyth expressed his surprise that this matter had been brought to an Employment Tribunal in the UK, and said that he was even more surprised that it was taken to an appeal, especially in light of the Russell v Transocean International  Resources Limited ruling.