A penalty of €8.67million in damages against Ryanair has been upheld by the Paris Court of Appeal in connection with non declared work in France and the fraudulent use of E101 foreign worker employment certificates.
The ruling was published on May 13 but only made public to the interested parties a week later.
The judges ruled that the company had "voluntarily evaded social legislation" in France by means of "fraud".
The case began in 2009, following a report against it from the illegal work office l’Office central de lutte contre le travail illégal, based on complaints from several employee organisations and the pension body CRPN (Caisse de retraite du personnel navigant).
The case centres on the company's base at Marseille-Marignane airport, which it was found to have opened without registering with the commercial register, nor declaring 130-plus flight employees to French social security office Urssaf.
The management was also found to have failed to set up bodies to represent these employees, such as an employee council, or staff representatives.
Ryanair claimed workers came under Irish law as working on planes registered there
Ryanair justified its actions by arguing that its teams at Marseille-Marignane were working on planes registered in Ireland, and said that as its registered office was located in Ireland, the employees concerned were therefore subject to Irish law.
The case is a long running saga. The company was first fined €8.67million in damages by the criminal court in Aix-en-Provence in October 2013, with 80% of this amount awarded to Urssaf and CRPN. This was awarded as compensation for Ryanair having paid contributions in Ireland and not France (also deductions in Ireland are lower).
The court said that Ryanair had "organised a real social drain" and "created a situation of unfair competition vis-à-vis other airlines that respect national legislation".
The sentence was confirmed on appeal. However, in 2018, the Cour de Cassation partially invalidated the penalty imposed on Ryanair and requested that the case be retried taking into account decisions, concerning other companies and E101s, made a few months earlier by the Court of Justice of the European Union. The Paris Court of Appeal therefore examined the case.
Elements of fraud over E101 certificates
However the court found that Ryanair had “knowingly” sought to circumvent French regulations by obtaining ‘E101 certificates’ from Dublin authorities, which certified that its employees were covered by Ireland’s social security.
These certificates were key as they effectively state in which country workers are operating. The court found that “elements of fraud were present” because the certificates “contained false declarations of residence”.
It also said that the airline had “voluntarily refused to apply” French regulations despite being “perfectly aware of its obligations” to declare its employees and register its base.
Urssaf lawyer Jean-Victor Borel called the decision “a great victory, because the social fraud committed by Ryanair has been recognised, not only in French law… but above all, in European case law”.
Sandrine Johnson, deputy director-general of the CRPN, also welcomed the decision from the Paris Court of Appeal, which she said had provided "enlightenment" on this type of case under European law.
The transport section of union FO added that the decision was “very significant because it condemns [Ryanair’s] fraudulent actions and unacceptable methods".
However, Luc Brossollet, one of Ryanair's legal advisors, said that he "does not share the analysis" of the Paris Court of Appeal and that another appeal to the Court of Cassation would be filed.