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BULLETIN TWO: Covid-19 and its impact on crews

07.04.2020 Yachts and superyachts

Julia Wiechell

Julia Wiechell Partner*

Marko Thies

Marko Thies Associate

The global Covid-19 pandemic has and will continue to have significant impact on yacht crews around the globe. This bulletin shall briefly address the challenges that crews and their employers face in these times and demonstrate an insight into the legal framework into which solutions must fit.

I. Impact of Covid-19 to Yachting and especially Crews

Undoubtedly, Covid-19 has had an unprecedented impact on each of our lives. This being said, most of us endure these times in the comfort of our  own homes and home offices. Yacht crews (and seaman in general) are likely to be far from home, potentially in countries they have no connection with and may have no chance to return to their homes in the near future. The situation deteriorates, if travel plans had to be changed due to the crisis and the yacht as well as the crew ended up where they did not expect to. The same might apply to yacht owners, their families and their guests. As labour law and social security systems around the world are being put to the test, yacht owners and their managers will find themselves in a heightened position of responsibility for the wellbeing of their crew.

II. Regime on the employment of seamen

If a yacht is operated commercially the crew contracts are most likely subject to the provisions of the Maritime Labour Convention 2006 (MLC) and its respective implementation into national law both that of the flag state and that of the location of the yacht. The general guideline is that the employer is responsible for the physical wellbeing of his crew. Furthermore, the MLC stipulates a set of minimum requirements for seafarers. 

Inter alia, the MLC asks for the protection of crew members to be in place in order to protect their health and ensure that every crew member shall have access to medical care whilst working on board on the account of the employer.

Furthermore, the MLC stipulates that a seafarer is entitled to repatriation on the account of the employer in case of termination of his employment or in case of illness or injury of the crewmember (if he is found medically fit to travel).

Where the rules of the MLC do not apply, many countries have implemented these or similar rules, in particular as the basis of national labour law. In addition to this, many employment contracts for seafarers take up these rules and specify them. 

Hence, the regime on employment of seafarers is interspersed with rules that take into account the basic principle that the employer takes responsibility for his employees. This is even truer as, due to the nature of yachting, the owner decides upon the navigation and crews will find themselves in places far from home.

We therefore encourage every owner and manager to consider the rules set up by the MLC, the flag state as well as the employment contract. These can – inter alia – stipulate the obligation of the owner/the manager to ensure that the seaman has a safe place to work at as well as the obligation to be repatriated in specific circumstances. Furthermore, it might be that the owner/the manager is obliged to set up a quarantine area on board (if possible) and to ensure that sufficient supplies of disinfectant as well as facial masks etc. are stored on board. 

III. Factual issues 

We are aware that the above duties of employers to their employees may face issues due to the normative force of the factual of the current situations. 

For example, in case of the above mentioned repatriation obligation of the Managers/Owners, the repatriation of a crew member may now become an issue as port states could ban crews  entering their territory or – once having been successful in berthing safely – the crew being quarantined for a certain time or not allowed to leave the yacht due to administrative order or missing visa if, for example, transit visas of seamen are not accepted by authorities as we have had experience of in a case in the United States. After having managed to disembark, crew members might not be able to leave to their home countries, because large parts of global air traffic have been suspended for the time being. Flights instructed by the national authorities for bringing home their citizens or private charter fights are possible solutions these days. Consequently there is a duty on the owner/manager to make emergency plans and to ensure prior to disembarkation that both transit and exiting the country via air, rail or road travel are possible.

Similar difficulties arise when crew members are heading to commence their work on a yacht and need to travel to the berth. In case of authorities closing the ports and prohibiting access to the respective premises it is impossible for the crew members to fulfil their duties under the employment contract. 

A further example of a problem that owners and their crews are currently facing is the significant danger that is connected with the crossing of great distances. It is spring time and many yachts started the passage from the Caribbean to the Mediterranean. The hurricane season is coming up and the regulations of most insurance companies force the yachts to leave the Caribbean as a consequence of the huge number of losses caused by hurricane "Irma" in 2017. These crews face the risk of an outbreak of Covid-19 on board whilst being offshore, as the incubation period of Covid-19 could be up to 14 days. Becoming ill during the passage would not only lead to the temporary loss of the workforce of a single employee whereas little to no medical aid is available, it can also lead to the infection of the entire crew and guests and can endanger the necessary manning of the yacht. Therefore practical solutions have to be found and were found – like a voluntary quarantine of the crew and all guests starting on board 14 days before the scheduled departure. 

Apart from the relationship between the crew and the owner, the current national restrictions cause practical issues on board. Crews have to face the challenge of bunkering stops, resolving technical problems, which need assistance of local technicians, and many more. 

Regardless of any emergency legislation we have to keep in mind that access to the port state territory must be granted if this is necessary in order to obtain immediate medical care to the seafarer, regulation 4.1. paragraph 2 MLC. Moreover, it is a long-established rule of customary international law to allow vessels in distress to enter the ports of any state to ensure seaworthiness and safety on board. 

Another factual issue might be the financial implications of the pandemic and a lack of liquidity caused by loss of charter for example. Owners might be forced to terminate employment agreements with seafarers. 

This is a range of the crews' and owners' factual problems. New ones are coming up each day. 

IV. State aids

We are monitoring different flag state authorities offering of different assistance to companies affected by the crises. 

The measures are varying from direct wage supplements, loans on easy terms to short work and others. They all have in common that they only apply to companies that can prove severe losses due to the pandemic. Moreover, the employer must be regularly engaged in economic activities. It is a question of individual review whether one of the state measures available is applicable for any given yacht owner. 

It is unforeseeable when these challenging times will end and the national authorities will suspend their emergency legislation and we will get back to "business as usual". But in the meantime we will continue to monitor the efforts of and liaise closely with the flag states and the various national authorities enabling us to continue supporting crews, owners and yacht managers who are faced with the challenges of these times with regard to all respects of owning, operating, building, refitting or any other matter related to their yachts.

Article authors:

Julia Wiechell Marko Thies