Key aspects:
- A cruise director at Costa Cruises received a €130,000 bonus after he was not rehired after signing 51 contracts with the company.
- An Italian labor court has ruled that the excessive use of fixed-term contracts is an abuse of the contract method.
- The ruling could have an impact on crews across the industry if recruitment practices are adjusted.
An Italian crew member for Costa Cruises has received a court settlement that includes generous compensation and rehire after a lawsuit found that his past employment practices at the cruise line were partly unlawful.
The lawsuit was accepted by the Labor Court of Bari, Italy, after the employee was not rehired as cruise director. Costa Cruises is headquartered in Genoa, Italy, and its nine cruise ships all fly the Italian flag.
according to ANSAThe unnamed crew member has worked for Costa Cruises for 18 years and has signed a total of 51 personal contracts from 2003 to 2021.
An average of 3.5 contracts are signed each year, but the length and other terms of the contracts are not specified. It’s unclear if he has remained a cruise director or if he changed positions or roles during his time with the cruise line, which is common for crew members Promotion to leadership positions.
At the end of the employee’s most recent contract, his services with the cruise line were not renewed. There has been no explanation as to why he was not rehired for another contract.
Generally, if the contract is not renewed, all benefits will cease, including health insurance and any potential pensions or bonuses.
To be clear, the crew was hired through a company in Curacao. It’s not uncommon for cruise lines to partner with different employment agencies around the world, especially in countries known for customer service and other qualities that are highly desired by crew members.
The crew appealed the dismissal, and the court’s outcome was surprising.
Court rules contract form abused
The Court not only reinstated the status of the crew but also considered that the repeated use of “fixed-term contracts” for such long periods was an abuse of such contracts and violated Italian and EU law.
A “fixed-term contract” is a specific type of agreement that provides for the performance of precise duties for a specified period of time. The most common use of fixed-term contracts is for project work such as consultancy or freelance work.
The Italian court held that the crew member should be regarded as a permanent employee of Costa Cruises, taking into account the length and amount of his contract with Costa Cruises.
Also read: How much does a cruise director make?
The crew member was ordered to return to work, and Costa Cruises was also ordered to pay €130,000 (approximately US$153,000) in liquidated damages plus interest on that amount. No further charges were made for any stress or emotional issues.
Costa Cruises may appeal the decision, but the cruise line has yet to make any official statement regarding the lawsuit.
Will crew contracts change?
The lawsuit could be the start of changes in how different cruise lines hire and employ cruise ship crews.
Fixed-term contracts are common in the cruise industry and cover many different types of crew members, from cabin crew and restaurant servers to entertainers, photographers, shore excursions and guest services team members, and even cruise directors.
While such limited contracts are generally acceptable for intermittent or short-term employment, long-term cruise ship crew members may find themselves in a more unique situation that may require a change to their contract.
Cruise lines may change their recruitment practices to accommodate this situation, or may develop different types of contracts for crew members who satisfactorily complete a certain number of fixed-term contracts.
The contract may also be rewritten with language that better clarifies the nature of the fixed-term clause to ensure the cruise line is protected from such lawsuits in the future.