Ryanair Faces £6.5m French Labour Law Penalty

Ryanair is facing a €8.3m (£6.5m) penalty after losing an appeal against a decision that it broke French labour laws.

The no-frills carrier was found guilty of paying workers under Irish contracts to save money on payroll and other taxes.

The bulk of the penalty is made up of fines while €200,000 was for damages, the court ruled.

The appeal ruling was issued a year after the original decision went against Ryanair.

At that time, the company said the majority of the financial penalties related to alleged non-payment of social insurance and state pension contributions in France for Ryanair crews.

The case centred around a facility operated by the company at Marignane, near the southern French cities of Marseille and Aix-en-Provence.

The company, run by its colourful chief executive Michael O'Leary, based four planes and 127 employees at the site without applying French labour law or filling out tax declarations in the country, it was said.

Ryanair argued that it did not have a permanent base in the area and that it was entitled to keep its workforce on Irish contracts, but prosecutors said its claim was not credible because the workers were living locally and the airline had offices there.

Ryanair's Robin Kiely said: "Ryanair will appeal this ruling to the French Supreme Court on the basis that European employment law clearly allows mobile workers on Irish registered aircraft to pay their taxes and social taxes in Ireland.

"We will also be seeking a referral to the European Court of Justice to prevent these attempts by the French authorities to claim social taxes that have already been paid in full to Ireland."

Social charges in France are at around 40-45%, compared to 10.75% in Ireland.

The airline will have to pay damages to trade unions, France's social security system and pilots among others, it was reported.

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