Recently, a crew labour contract dispute adjudicated by Nanjing Maritime Court was featured in Volume 4, 2025 of Chinese Maritime and Commercial Law Reports. The journal is issued by Informa UK plc, a world-leading publisher specialising in maritime and commercial law. This is the fourth judgment from Nanjing Maritime Court to be included in its publications.

Since its establishment, Nanjing Maritime Court has fully advanced its elite maritime judgment strategy. It consistently delivers high-quality illustrative cases to showcase China’s maritime judicial practice and convey China’s voice in maritime justice.

Facts

In July 2022, the claimant Zhang entered into a seafarer employment contract with two defendants: a shipping company based in Shenzhen and Runhai Shipping Company registered in Hong Kong. The contract stipulated that Zhang would work as a trainee seaman on a vessel with a monthly basic salary of RMB 3,000, and Zhang embarked the vessel at Zhangjiagang on the same day. His monthly basic salary was raised to RMB 10,000 in February 2023. In March 2023, the two parties signed a second six-month employment contract appointing Zhang as a watch seaman on a monthly salary of RMB 11,500. Nevertheless, the Shenzhen shipping company and Hong Kong-based Runhai Shipping Company failed to fully settle Zhang’s overtime wages and payment for untaken annual leave, and terminated the employment contract ahead of schedule. Zhang thus instituted proceedings against the two companies before the court.

Judgment

Nanjing Maritime Court ruled that Mainland Chinese law was applicable to the dispute. As Runhai Shipping Company is a Hong Kong-incorporated entity, it does not qualify as a mainland employer under the Labour Contract Law of the People’s Republic of China, rendering such law inapplicable to the company. All issues concerning the performance and termination of the contractual relationship between Zhang and Runhai Shipping Company were to be governed by the relevant provisions of the Contract Part of the Civil Code of the People’s Republic of China and other applicable laws and regulations. The Court ordered the Shenzhen shipping company and Runhai Shipping Company to jointly pay Zhang compensation for unlawful premature termination of contract, outstanding overtime wages and payment for unused annual leave. None of the parties lodged an appeal after the first-instance judgment was handed down.

Significance of the Case

Based on the practical experience of seafarer labour dispatch,this judgment clarifies that parties may rely on their chosen governing law to settle seafarer labour contract disputes with Hong Kong-related elements, on three preconditions: the chosen law does not violate mandatory statutory provisions, it bears a substantial connection to the dispute, and it ensures equal protection of all parties’ legitimate interests. If the parties elect to apply Mainland law to resolve such disputes, the court shall hear and determine the case in accordance with relevant provisions of the Contract Part of the Civil Code. This judgment delivers systematic judicial guidance on choice of law rules governing seafarer labour contracts containing foreign elements, as well as those involving Hong Kong, Macao and Taiwan regions.