The cases
Viking
In this case the company wanted to
reflag its ship and to replace the Finnish crew with an Estonian
crew on lower wages. The Finnish Seamen’s Union threatened
industrial action in protest at this and in support of the ITF’s
campaign against Flags of Convenience. However, the company
went to court on the issue and was ultimately successful in the
ECJ. The court did rule that the right to strike is an
integral part of EU law. However, it also took the view that the
court can review whether industrial action is justifiable. In
Viking, the court determined that industrial action was not
‘proportionate’. This brings considerable uncertainty into
what view a court would take on the merits or otherwise of
industrial action.
Laval
This case involved a Latvian company
posting workers into Sweden on Latvian terms and conditions, which
undercut the Swedish collectively bargained terms and
conditions. The Swedish unions responded by taking industrial
action and by arranging a boycott of supplies to the Vaxholm
site. Laval claimed through the courts that this restricted
their freedom of establishment. The court took the view that where
the Posting of Workers Directive applies it is unlawful for unions
to organise industrial action for terms and conditions above the
legal minimum available in the country. This would mean, for
example, that in construction where there are collective agreements
on wage rates a posted worker would only have access to the minimum
wage and that a union couldn’t take action to ensure that the
collectively bargained terms weren’t undermined.
Rüffert
This case involved a public contract for a prison which was awarded
to a German company and then subcontracted to a Polish
company. The tender required companies to pay the rates
included in the Building and Public Works Contract collective
agreement, including any companies that were subcontracted to do
the work. The Polish company was paying a lower rate and was
fined for doing so. The Posting of Workers Directive (PWD)
states that minimum rates may be set by a collective agreement
where it was either universally applicable or applied to the whole
sector or region. The court found that the collective
agreement in this case didn’t meet either criteria and that,
therefore, the Directive prevents public contracts requiring
compliance to collective agreements of this kind. In reaching
this judgement the court interpreted the Directive very narrowly
and also ignored the Procurement Directive, which allows for social
clauses. The case also clearly allows unfair competition from
companies based in other countries.
Luxembourg
This time the
European Commission itself took Luxembourg to task over legislation
making its legislation applicable to workers posted there from
another Member State. Forty per cent of workers in Luxembourg
are from outside the country. The ECJ supported the Commission
in deciding that Luxembourg had gone too far in implementing the
PWD in relation to requirements for maximum work periods and
minimum rest periods. Luxembourg must now change its law so
that it enables using foreign workers to undermine the conditions
of workers in Luxembourg.
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