Decision on Foreign Seaman's Wage Claims

The U.S. Court of Appeals for the Fifth Circuit ruled that wage claims brought by foreign seamen for work on foreign ships are subject to the Foreign Arbitral Awards Convention, even where the claims are based on U.S. law. In the instant case, plaintiff Philippine seamen brought suit in federal court in Louisiana against the shipowner, alleging violation of the U.S. Fair Labor Standards Act (FLSA) for failure to pay federal minimum wage and overtime. Defendant asserted that plaintiffs’ employment contracts were controlled by Philippine law and required arbitration of wage disputes in the Philippines. The trial court refused to order arbitration, citing a Louisiana law expressing the state’s strong public policy against forum selection clauses in employment contracts. On appeal, the court held that the Convention, which requires arbitration in such cases, is the supreme law of the land. Lim v. Offshore Specialty Fabricators, Inc., No. 03-30380 (5th Cir., HK Law).