Crew members who were forced to work aboard Bahamas Paradise Cruise Line ships for five months this year without pay are still waiting to be compensated.
On Thursday a federal judge called an $875,000 settlement agreement between lawyers for the company and lawyers for the estimated 275 crew members “wholly inadequate” and sent the legal teams back to the negotiating table. A lawyer for Bahamas Paradise Cruise Line said it needs to raise money for the settlement fund as it struggles to stay afloat, and that bankruptcy is a “possibility.”
U.S. District Judge Beth Bloom for the Southern District of Florida said she is concerned that the agreement does not do enough to compensate the crew.
“I have a concern about having to wait another year from the time the settlement is approved to be paid out,” she said. “It’s unfair to these individuals. We’re dealing with individuals like us who have to be paid for their work.”
Bahamas Paradise Cruise Line operates two-night cruises from West Palm Beach to Grand Bahama on its two ships. The company is majority-owned by the family of former Norwegian Cruise Line CEO Kevin Sheehan.
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The company used threats of jail time and promises of a one-time $1,000 payment that never came to keep crew working without wages during the pandemic, according to interviews with five crew members. The Herald obtained recordings of crew meetings with CEO Oneil Khosa, President Kevin Sheehan Jr., and hotel director Prem Kainikkara during which the payments were promised.
After the U.S. government canceled cruises on March 14 amid COVID-19 outbreaks on several ships, Bahamas Paradise Cruise Line asked crew members on its two ships, the Grand Celebration and the Grand Classica, to sign an agreement to stay on board without pay. The company said it would pay crew members again as soon as cruising resumed — at that time, estimated as mid-April. The company forced hotel staff including cooks and cleaners to continue working, according to interviews with crew members, and asked others, such as casino staff, to pick up kitchen shifts — all without pay.
As the months passed without cruising, crew members begged to be sent home; the company stalled, falsely claiming the U.S. Centers for Disease Control and Prevention wasn’t allowing it to repatriate crew. The CDC never stopped allowing repatriation but did require cruise companies to use private flights instead of commercial and insisted that company executives sign agreements ensuring the agency’s COVID-19 protocols would be followed. Cruise companies repatriated thousands of crew members through the U.S. during the summer.
Crew members sued Bahamas Paradise Cruise Line in the U.S. District Court for the Southern District of Florida in August. The suit alleges the company forced crew to work without pay, delayed repatriating crew to cut costs resulting in false imprisonment, did not provide crew members the two months’ severance guaranteed in their employment contracts and forced them to sign misleading agreements terminating their contracts.
The company’s lawyers and crew members’ lawyers reached a settlement agreement in September, but it needs court approval.
According to the settlement, the company will pay workers who signed the agreements the two months’ severance guaranteed in their contracts, and an additional $1,000 for “any and all work performed” on the ships. Attorney for the crew members Michael Winkleman said the agreement is poorly worded, and the crew members will be compensated for all hours worked. Thirty percent of the total payout — or $262,500 — will go to the attorneys and cover administrative costs of the settlement.
At Thursday’s hearing, Bloom questioned why the agreement doesn’t prohibit the company from engaging in the same practices going forward, like forcing crew members to sign termination agreements. She also said the agreement doesn’t compensate the crew members “100%” and denied the settlement, ordering both sides to file new briefs on the issues before the end of November.
The company’s lawyer Catherine MacIvor told the judge that Bahamas Paradise Cruise Line never intended to stiff the workers.
“The company is cash strapped,” she said. “They were housing them, feeding them. There were a couple of people making food for the crew. They were well taken care of.”
Spokespeople for the company did not respond to a request for comment.
With just two ships, Bahamas Paradise has been particularly hard hit as cruises remain canceled by the pandemic, MacIvor said, and will need to raise money to pay any settlement. The settlement says crew members will have a lien in the amount of $375,000 on the Grand Celebration ship if the company can’t secure financing by the end of the year, a maneuver Bloom called “illogical.”
“Those funds should be made available from the beginning,” Bloom said.
Looming over the case are arbitration clauses crew members agreed to in their employment contracts. If both sides can’t reach a settlement and get it approved by the court, the crew members will be forced to arbitrate their claims individually, an option Winkleman said puts them at a grave disadvantage.
“We’re either going to get a settlement or roll the dice,” he said. “I hope [the company] will agree to a quicker time frame for payment. I’m very pleased with the way the judge handled the hearing. I think she has legitimate concerns about the finality of the deal.”