General

The COVID-19 / Coronavirus and Crewmember and Seaman Wages

With the recent spread of coronavirus slamming the economy, many employers are laying off employees. Seamen and crewmembers (both referred to as “crewmembers”) will be affected because vessels, yachts, and charterers depend on crewmembers’ services. Moreover, many vessels, yachts, and charterers operate on thin margins and it may be more cost efficient to lay up a vessel until demand returns. 

Crewmembers are entitled to their wages. Underpaying or simply not paying wages exposes the vessel owner and the vessel itself to liability. 

The US federal statutes provide crewmembers a preferred maritime lien for owed wages. In other words, the US federal courts may place a lien on a vessel in the amount of the crewmembers’ wages. Further, the crew member’s maritime lien is usually given priority over other maritime liens. A crewmember asserting a wage claim against the vessel is called an in rem action, and the crewmember’s wage claim attaches to the vessel which can be sold to satisfy the wage claim. Additionally, if the crewmember had an employment contract with the vessel owner, then a crewmember may be able to file an in personam action against the vessel owner. The contract may give the crewmember the ability to recover his or her attorneys fees. 

The maritime lien exists in law, and the process to enforce the lien requires a Verified Complaint filed in federal court seeking a Rule C Arrest. The Verified Complaint asks the court for a warrant to arrest the vessel. After the court grants the warrant, the U.S. Marshals will serve the vessel with the warrant and arrest the vessel. Usually, the vessel will post a bond and the bond money is held in escrow or the court registry until the claim is adjudicated. However, if the vessel does not post a bond then it is usually transferred to a vessel custodian and can be auctioned to satisfy the maritime lien. 

At Gunther McIntosh, PLLC we’ve represented crewmembers, vessel officers, and seamen in maritime wage claims, and we also assist vessel owners in defending against frivolous maritime wage claims. We are thoroughly familiar with the process to arrest a vessel to secure a lien; to appoint a custodian to release vessels; and enforce or defend against maritime contracts. Please contact Ben Dowers if you have any questions at bwd@gunthermcintosh.com

-Benjamin Dowers

Mon Mar 23, 12:53am