One of Ryanair's pilots has won a test case in a London court that will have repercussions for other cockpit crew in dispute with the carrier, and possibly for the viability of the complex pilot employment model it uses.
The case was brought at the Mayors and City of London County Court by Brookfield Aviation International, the UK-based agency that recruits pilots for Ryanair and carries out much of the contractual and human resources work on behalf of the airline.
Brookfield alleged that the pilot owed it €5,000 ($6,600) for failing to work his full notice after he resigned. It claimed that he had no right to use 10 days' remaining leave as part of the notice period.
But the judge ruled that the sum demanded bore no relationship to the cost of loss of business and was therefore a deterrent penalty, which is invalid under UK employment law.
London commercial law firm Bates Wells Braithwaite, which briefed the pilot's case, explains that Brookfield requires would-be pilots to engage an accountancy firm, from an approved shortlist, to arrange for the pilot to become a director of a limited company based in Ireland.
This service company then enters into a contract to provide the pilot's services to Brookfield which, in turn, provides them to Ryanair.
"The consequence of this arrangement is that Ryanair denies the pilot's employment and other direct rights against it, even though it is the party to whom their services are ultimately and exclusively provided," says the law firm.
"Despite this arrangement, the pilots do not enjoy the advantages of autonomy and control of their working arrangements that self-employment usually entails."
The judgement in the case refers to the "bizarre nature" of the agreement.
Brookfield has not filed for an appeal, says Bates Wells Braithwaite. Three similar cases have been awaiting the outcome of this one.
"This is an important decision because it fundamentally challenges the relationship that Ryanair has with many of its pilots," claims William Garnett, the head of the firm's employment team. "The court has found that it is not lawful to penalise these pilots in the way that Ryanair's agency has tried to do."
Ryanair Pilots Group, which says that budget airline Norwegian has adopted a similar contracting model, notes: "The ruling serves to highlight flaws in the employment model that Ryanair imposes on the majority of its pilots."