31 March 2008

The ETUC Response to ECJ judgments in Viking and Laval

Following a debate at the Executive Committee on 4 March in response to Laval, Viking and other decisions expected in similar cases the ETUC passed a resolution stating: “One thing is very clear: for the ETUC and its members the outcome of these two cases represents a major challenge. How to establish and defend labour standards in an era of globalisation? And in these cases the ECJ does not sufficiently recognise and allow trade unions to defend their members and workers in general against social dumping, to fight for equal treatment of migrant and local workers, and to take action to improve living and working conditions of workers across Europe.”

“The idea of social Europe has taken a blow.” the resolution goes on “Put simply, the action of employers using free movement as a pretext for social dumping practices is resulting in unions having to justify, ultimately to the courts, the actions they take against those employers’ tactics. That is both wrong and dangerous. Wrong because workers’ rights to equal treatment in the host country should be the guiding principle. Wrong because unions must be autonomous. And dangerous because it reinforces critics of Europe who have long argued that the single market would inevitably threaten social standards.”

It concludes: “It has now become urgent for the ETUC to develop a joint and coordinated strategy with its members to prevent conflicting collective agreements in cross border situations and the potential scope for abuses and manipulation arising from this…The ETUC calls on the European authorities to recognise that these cases are not solely about the models in Sweden and Denmark but have European wide implications. We call for early action to reassure unions that fundamental rights are not diminished by the free movement provisions of Europe. Already some are linking ratification of the EU Reform Treaty to correcting these cases. The ETUC supports the EU Reform Treaty, and that’s why urgent action is necessary. Because it would be naïve of the European and national authorities to conclude that these cases will not be increasingly in the minds of workers and trade unions.” We will await developments with interest.

To read the full ETUC resolution - click here

Previous Articles on Viking and Laval

9 January 2008

Viking and Laval - a Curate's Egg Followed by a Bad Egg

These eagerly awaited decisions by the European Court of Justice dashed expectation and the outcome looks like a real set back for workers rights.

Hopes were fairly high when the “Viking” decision was published on 11th December. On the downside for us the ECJ recognised the shipping line’s right to take action against the union in defence of the EU treaty right for businesses of “establishment”, or to operate anywhere in the EU. And the same principle would be expected to apply to the other fundamental rights for businesses – for freedom to provide services, to supply goods and move individual labour and capital.

But this right for business appeared to be balanced by a clear assertion of the fundamental right to take industrial action by the Finnish Seamen’s Union albeit as a last resort. The case was referred back to the Court of Appeal to apply this declaration of EU law to the circumstances of the case, but it looked like the union would be able to exercise the fundamental right to take action and stop Viking re-flagging the ship – the Rosella - so they could pay wages at Estonian rates. It even seemed the right to take collective action might be overarching to the extent that the UK’s opt out of legal enforcement of the EU Social Charter might not work.

A week later and all hopes were dashed with the verdict in “Laval”. Put simply the unions lost. The practical effect throughout the EU is being considered, but the judgment might outlaw any industrial action to prevent service providers from another member state paying low wages and having poor terms and conditions, as long as the wages and terms are above the bare minimum.

The United Campaign thinks the ECJ decision was wrong. But their decisions cannot be appealed. Their interpretation of EU directives – giving business such free rein - is at odds with the ILO and other international conventions on the right to strike and the right to collective bargaining.

The Judges did not appear to understand the industrial context of rights in Sweden. The rights of collective labour in the EU have now been clarified. They are extremely limited when compared to the rights of capital, goods and services all of which take precedence over collective rights if the Laval case judgment is allowed to stand.

“Laval” will also have repercussions in a number of member states without statutory/universal minimum wages. In Sweden and Germany, for example, they have not needed a minimum wage before now as collective bargaining was a respected part of the countries infrastructure. And in those states that have a minimum wage, the decision is an encouragement to businesses across Europe to drive down wages to the level of the minimum wage.

28 June 2007

The cases of Viking and Laval

In two important cases before the European Court of Justice the court must decide about union rights to take industrial action, when companies argue that this interferes with their freedom within the “Common Market” to establish themselves and provide services wherever they want and to benefit from individual rights of freedom 0f movement for work.

On 23 May 2007, two different Advocate General’s delivered their opinions in the cases, which the ECJ will pay heed to before delivering their judgment. Both AG’s agreed this was a very complex issue and both reached similar decisions.

In the “Viking” case, the company wanted to re-flag the Rosella, a ferry sailing between Finland and Estonia, to take advantage of lower wages paid in Estonia, but the Finnish Seamen’s Union – with the help of the International Transport Federation - were in a position to take effective action to stop that happening.

In the “Laval” case, a Latvian company wanted to supply Latvian construction workers to sites in Sweden, but tried to by pass a collective agreement with Swedish unionists on pay and conditions – again to pay less money.

In the “Laval”, case the AG said this: “…the right to resort to collective action to defend trade union members’ interests is a fundamental right. It is therefore not merely a ‘general principle of labour law’, …but rather a general principle of Community law, within the meaning of Article 6(2) EU. That right must therefore be protected in the Community.”

However, the AG’s are clear that the right to take collective action is limited. Collective action would not be protected if it sought to discriminate in favour of a particular nation’s workers and their pay and conditions, or to interfere with relocation of workers within the EU. It would have to be action which genuinely sought to retain or better the conditions of all, or to prevent “social dumping”.

There is also acceptance in the opinions to the effect that member states can apply national laws in relation to permissible or impermissible industrial action. Thus the position in Finland and Sweden is different to that in the UK, for example.

It remains to be seen how the judgments impact in particular circumstances and on particular events.

And one important issue arises for trade unions in the UK. If the fundamental right to resort to collective action to defend trade union members’ interests is to be protected by the EU, surely the UK restrictive anti-union laws, including against secondary action, require change.

The European Social Rights Committee have already reported that the position that the UK law is excessively restrictive “…in circumstances where action ought to be permissible in order to enable workers and their unions adequately to protect and to promote their economic and social interests, and to organise their activities” and that the Government should introduce amendments which enable workers to take industrial action more freely.

United Campaign to Repeal the Anti Trade Union Laws, 39 Chalton Street, London, NW1 1JD | info@unitedcampaign.org.uk