Earlier discharge of a seafarer under Cyprus Law

Posted on 28 Jul 2020, by Andria Lambrou

This article will examine the Merchant Shipping (Masters and Seamen) Laws of 1963 to 2002 and the amendments introduced by Law 233(I)/2002 together with the repeals effected on 20/08/2013 by Ratification Law 6(III)/2012 regarding the ILO Maritime Convention 2006 in relation to earlier termination by the shipowner and/or the master of a Cyprus flag ship of a Seafarer Employment Agreement (hereinafter referred to as the “SEA”).

To do so, we will examine a hypothetical scenario where a seafarer working on board of a Cyprus flag ship under a valid SEA for the duration of 6 (six) months, is discharged prior to the expiration of his/her SEA. The expiration date of the said SEA in this specific hypothetical example is 31 July. The terms, however, of the said SEA entitle the master to terminate the employment of the seafarer 1 (one) month prior to its expiry. In this scenario, the Cyprus flag ship is undergoing a voyage from Osaka in Japan with estimated time of sailing on 1 June, bunkering at Singapore on 15 June and arriving at the port of Warri in Nigeria on 31 July without stopping at any other port. The port at Warri in Nigeria is considered as an unsafe area for crew exchanges. According to the ICC International Maritime Bureau’s latest piracy report, violent attacks against ships and their crews have risen in the first half of 2020 especially in the Gulf of Guinea off West Africa, accounting for just over 90% of the maritime kidnappings worldwide.  Under these circumstances, is it possible for the shipowner terminate the SEA earlier and discharge the seafarer at Singapore, without being liable to pay the seafarer’s salary for the remainder of the SEA period and/or any other compensation? In light of the circumstances, the shipowner should consider whether or not he can effect the seafarer’s repatriation at Singapore on 15June on humanitarian grounds, namely, the seafarer’s well-being.

According to the provisions of the relevant legislation, every seafarer must have an Employment Agreement signed by both him and the shipowner or the shipowner’s representative, usually the master of the ship. Applicable collective bargaining terms are normally incorporated in the Employment Agreement. These contracts are usually negotiated between the masters of the ship and the seafarers’ trade unions. The causes for justified dismissal agreed between the parties are incorporated in the relevant SEA, having regard to the relevant Collective Bargaining Agreement.

The legislation mentions that if a SEA has been made for a specific period, is concluded for a specific voyage or it has been made for an indefinite period, both the master and the seafarer are entitled to terminate the SEA. However, neither the master nor the seafarer, can terminate the SEA at will. The master may terminate the SEA if the seafarer, without any reasonable cause, fails to embark on the ship on the agreed date, or if he is unjustifiably absent at any time, or due to a serious offence of the seafarer, as a result of which the safety of the ship or observance of due discipline or order on the ship is jeopardized, or if the ship becomes unseaworthy. The seafarer may terminate the SEAif the master is guilty of a serious breach of his duties towards the seafarer. In the event that the shipowner decides to terminate the SEA earlier and discharge a seafarer for any reason other than the reasons stated above, what will the shipowner’s liability be towards the seafarer?

From a legal perspective, in the case of the early termination of the SEA by the master or owner of the ship without any fault on the seafarer's part to justify that termination, the seafarer is entitled to be paid all the wages earned until the last day of work. The seafarer is also entitled to receive compensation for any damage caused to him/her. At this point it is important to note that there is no legal provision with respect to criteria to be taken into account when determining the amount of the said compensation. In fact, the relevant legislative framework only states that a seafarer who was improperly discharged before the commencement of the voyage, or before one month’s wages are earned, without fault on his part to justify that discharge, and without his consent, he shall be entitled to receive from the shipowner, in addition to any wages which he has earned, due compensation for the damage caused to him by the discharge. If the discharge takes place in the Republic of Cyprus, the compensation cannot exceed one month’s wages, and if the discharge takes place elsewhere, it cannot exceed two months’ wages. The seafarer may recover that compensation as if it were wages duly earned. With respect to Cypriot employees other than seafarers, the amount of compensation is decided by the Labour Disputes Court after an application is made by the employee. In assessing the amount of compensation, the Court gives consideration to several factors including, but not limited to, the emoluments of the employee and the circumstances of his/her dismissal.

The legislation further mentions that if a seafarer is discharged outside Cyprus and if the discharge was made without the consent of the seafarer while his/her SEA is still in force, the master shall, besides paying the seafarer the wages to which he is entitled, also make adequate provision for his/her maintenance and for his/her return either to the port at which the seaman was engaged or a port inthe country to which he/she belongs or to a port agreed to at the time of the discharge. The costs of repatriation shall be borne by the shipowner, except in cases where the seafarer is found in serious breach of his/her employment obligations. The shipowner is also responsible for regulating the seafarer’s repatriation by appropriate and expeditious means and he will need to provide financial security or other insurance coverage in order to ensure the seafarer’s repatriation. 

Since the relevant legislation and the said SEA are silent in relation to this specific example, and depending on the terms of the SEA and any Collective Bargaining Agreement, it can be argued that although the seafarer is discharged prior to the expiration of his/her SEA, and prior to the time the shipowner could legally terminate the said SEA  (i.e. according to the terms of the said SEA the shipowner could terminate the seafarer’s employment 1 (one) month prior to the expiration of the SEA), the shipowner could take steps to repatriate the seafarer at Singapore on 15 June on humanitarian grounds, without being liable to pay his/her salary for the remainder of the SEA period and/or any other compensation. It should be noted that this is a hypothetical example and that each case is different and should be examined on its own unique facts.

The content of this article is intended to provide a general guide to the subject matter and does not constitute legal advice. For any further information please contact Andria Lambrou, Associate of Michael Kyprianou & Co LLC by email at andria.lambrou@kyprianou.com or by phone at +357 25 363685.