On the Job

Recouping Missing Pay as Yacht Crew

18 June 2021By Kate Lardy
iStock/Ceri Breeze

Written by

Kate Lardy

Based in Fort Lauderdale, freelance writer Kate Lardy got her start in the yachting industry working as crew. She spent five years cruising the Bahamas, Caribbean, New England, and Central America, then segued that experience into a career in marine journalism, which has included stints as editor of Dockwalk and ShowBoats International.

Morale was low among the crew on M/Y Deadbeat.

Their last month’s salaries didn’t come through as usual on the 28th. The owner of the private yacht had a lot of business ties to the travel industry and had been hit particularly hard by the pandemic. As it was, they were operating with half the usual crew, just keeping the vessel in serviceable condition.

The owner himself hadn’t been on board in many months due to COVID travel restrictions, and it was taking longer and longer for the captain to receive a response to his various inquiries. It was now midway into the next month and despite several promises from the owner’s office that payment was forthcoming, no deposits had been made into their accounts.

The crew was split on what to do next. Some were talking about cutting their losses and jumping ship rather than continuing to work for free, while others wanted to stay and fight for the missing pay — after all, they were owed thousands of euros each. On the other hand, a legal battle would be costly and they were all hesitant to take the matter to a lawyer. That reluctance is what bad ship owners count on, says Rachel Lynch, strategic organizer for Nautilus International. The seafarers’ union helped more than 50 yacht crewmembers recoup a total of £722,000 in missing wages in 2020.

Disputes on private yachts that are not voluntarily MLC-compliant and don’t have written employment contracts can be more difficult to resolve.

Indeed, crew complaints about missing or delayed pay are on the rise. The Maritime Authority of the Cayman Islands (MACI) noted a significant increase in wage disputes in 2020 — the vast majority from crew on yachts. The MACI shipping master, who deals with welfare issues, reports that these disputes more than doubled from 2019 and represented half of all the seafarer complaints MACI received in 2020.

Like in our fictitious scenario, crew can feel like the little guy in these situations, hapless against the owner’s vastly superior resources. The first step for them is notifying the captain and/or management company of the grievance. Next, they should lodge a complaint with the flag state.

“If the boat is covered by the MLC, then the ship owner has breached the convention by not paying the wages; the flag is responsible for enforcing the convention and can issue penalties. The port state can also issue a detention for non-compliance,” says Lynch.

In cases of delayed payments, which MACI says make up the majority of its wage complaints, the shipping master will advise to wait two to three weeks before involving the flag formally, but will give informal advice straightaway.

“Sometimes wage delays are more ‘intentional,’ for instance when a seafarer has been terminated due to a falling out or for misconduct,” says the MACI shipping master’s 2020 summary report. “In these cases, there may be a reluctance on both sides to resolve amicably and the shipping master does become formally involved.” Following termination with cause, only the cost of repatriation (subject to a cap) can be deducted from wages, says the shipping master. “Any (other) recovery from seafarers should take place in the courts, but wages should be paid in full. In most cases when the shipping master becomes formally involved in such cases, then the issue is resolved fairly quickly through negotiation.”

“There are often multiple jurisdictions involved in yacht contracts: the flag, governing law of the SEA, location of the yacht, seafarer’s nationality, location of the employer, location of the ship-owner,” says Rachel Lynch of Nautilus International.

Disputes on private yachts that are not voluntarily MLC-compliant and don’t have written employment contracts can be more difficult to resolve. In these situations, MACI says the shipping master will try to obtain as much evidence as possible in the way of text messages and emails in order to assist. “Normally, these disputes are resolved informally, as any other wage dispute, but sometimes where there is limited or no evidence, it is impossible for MACI to become involved, and these cases are closed either by the seafarer or the shipping master very early on. It is in both sides’ interests that all seafarers have a written contract when working on any Cayman Islands vessel,” says the 2020 summary report.

If either party pursues legal action, then the shipping master will step back from the dispute. Determining the legal jurisdiction can be tricky. “There are often multiple jurisdictions involved in yacht contracts: the flag, governing law of the SEA, location of the yacht, seafarer’s nationality, location of the employer, location of the ship-owner,” says Lynch. “I am often contacted by (Nautilus) members with pre-existing issues who don’t even know where to start but this really needs to be assessed by a maritime lawyer to establish firstly, which jurisdictions we are able to make a claim, and, secondly, which of these jurisdictions the claim is more likely to be successful.”

For Nautilus union members — who must be members before a wage dispute arises — Nautilus can assist in the legal battle. “Nautilus carries out an initial assessment and review of the case and then outsources the work to a lawyer in the relevant jurisdiction,” says Lynch. In addition to an in-house legal director in London, “we have built up a network of lawyers that we use for our work in the superyacht industry in jurisdictions.… Nautilus will cover all legal fees and members keep 100 percent of the compensation.

“Nautilus is fighting back,” says Lynch. “Sometimes all it takes is a letter or email declaring our involvement for the payment to be made.”

This article originally ran in the June 2021 issue of Dockwalk.

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