IR Notes

“European social dialogue first saw the light of day in the course of a meeting convened by European Commission President Jacques Delors on 31 January 1985″… These words open a policy paper published by the Jacques Delors Institute and authored by Jean Lapeyre, who was deputy general secretary of the European Trade Union Confederation from 1991 to 2003. This document, which retraces the history of European social dialogue, finishes with recommendations aimed at “imparting a fresh boost to social dialogue, and strengthening that dialogue in the future”: to put in place a legal framework for the “independent agreements” of the social partners (that is to say, agreements concluded at their own initiative without the intervention of the European Commission) with an “independent body capable of arbitration and of conciliation”; to create a European social dialogue secretariat funded by the budget of the EU in order to give it the resources necessary for the functioning and development of social dialogue, or even to launch social dialogue specifically for the euro area. These proposals may inform the high-level conference organised by the Commission on 5 March next in Brussels, with representatives of the European social partners. The discussions will centre on four topics: 1. To integrate the social partners better in economic governance both at European and national level. 2. To improve the participation of the social partners in formulating European policies on social matters (e.g. worker mobility, labour market integration), but also in other spheres such as the energy union or the single digital market. 3. To strengthen the European agreements concluded by the social partners, in particular when these are being “transposed” via a European directive. 4. To consolidate social dialogue in the member states, with financial backing from the EU. The Commission also intends to review its funding lines in support of social dialogue and industrial relations, giving priority to projects backed by the European social partners. The Commission President, Jean-Claude Juncker, announced his wish to be a “president of social dialogue”. 2015 will tell.

> Also see the special page dedicated to this subject by the Foundation for the Improvement of Living and Working Conditions (Eurofound) and in particular the post on the blog of Christian Welz on the founding meeting of social dialogue, on 31 January 1985 at Val Duchesse castle (in English).

• System of taxation applicable in the case of parent companies and subsidiaries: Directive 2015/121 of 27 January 2015, which amends directive 2011/96 concerning the common system of taxation applicable in the case of parent companies and subsidiaries in different member states, has been published in the Official Journal. The aim is to prevent misuse of a measure intended to exempt dividends and other profit distributions paid by subsidiary companies to their parent companies from withholding taxes.

• Increase in pre-financing for measures to benefit young people: The European Commission on 4 February adopted a proposal for a regulation aimed at increasing the initial pre-financing amount paid to operational programmes set up by the member states as part of the Youth Employment Initiative. Once adopted by the Council and the Parliament, this text should enable one billion euros to be released in 2015 which, according to the Commission, will allow the pre-financing member states receive to boost youth employment to be multiplied by 30 and permit up to 650,000 young people to be helped into work (see Commission press release and the associated Q&A memo (other languages IT PT EL PL). This initiative corrects one of the numerous flaws in the Youth Guarantee scheme, whereby the amounts mobilised by the countries most affected by youth unemployment were to be included in the budget deficit calculation; this does not encourage countries to adopt such programmes. Pre-financing will allow them to incur expenses without having to finance them from their own budget.


• Assistance from the Globalisation Adjustment Fund: The European Commission on 3 February proposed to provide financial support of 8.7 million euros to Greece, to help 1,633 workers who lost their jobs in the media sector to find employment again (see Commission press release, in English).

• The European Court of Justice cannot rule on the validity of a probationary period lasting one year: The European Court of Justice was invited to rule on the compliance of one of the flagship measures of the 2012 reform of the Spanish labour market with EU law: a one-year trial period, during which the employer could terminate the employment contract of someone recruited under the new “employment contract of indefinite duration to support entrepreneurs” at any time without a justifiable reason (CJEU, 5 February 2015, case C-117/14, Nisttahuz Poclava). A female worker dismissed during her probationary period thus referred the matter to the Court of Justice, raising the question of whether this constituted a breach of the Charter of Fundamental Rights of the EU, ILO Convention 158, the European Social Charter and directive 1999/70 of 28 June 1999 concerning fixed-term work. While the European Committee of Social Rights delivered a report in January which found this provision to be contrary to the European Social Charter, the European Court of Justice declares, rightly, that it does not have jurisdiction: the Charter of Fundamental Rights applies only to those texts which implement the law of the EU. Moreover, the disputed contract cannot be considered as a fixed-term contract and therefore does not fall within the scope of directive 1999/70. In addition, the court is not competent to rule on the interpretation of provisions of the other forenamed instruments of international law. Finally, no other provision of EU law regulates the probationary period. “The law on termination of employment is not covered by EU labour legislation; this is one of its weaknesses,” comments Jean-Philippe Lhernould, professor at the University of Nantes.


• Clarifications concerning the directive on dismissals for economic reasons: The Advocate General of the European Court of Justice has delivered an opinion in three cases concerning the directive on collective redundancies (CJEU, 5 February 2014, cases C-182/13, C‑392/13, C‑80/14). The question at issue was to determine the exact scope, in the case of collective redundancies, of the concept of “establishment” referred to in Article 1(1)(a) (2) of directive 98/59. The court is expected to deliver its ruling later this year.


• Consideration of periods of work performed before the age of 18: Almost six years after the Hütter case (CJEC, 18 June 2009, case C-88/08), the European Court of Justice has again ruled on an Austrian matter concerning an employee whose reference date for the purposes of advancement did not take apprenticeship periods prior to the age of 18 into account (CJEU, 28 January 2015, case C-417/13, ÖBB Personenverkehr AG v. Starjakob). The court stated that “as long as a system to abolish discrimination on grounds of age in a way that conforms with the provisions of Directive 2000/78 has not been adopted, re-establishing equal treatment entails granting” to disadvantaged persons “the same benefits” as those which have been enjoyed by employees in a comparable situation.

• Funding of the social partners: As provided for by law No. 2014-288 of 5 March 2014, the fund for financing employers’ professional bodies and trade union organisations was established by the decree of 31 January . This fund is to finance the social partners in the light of their public interest role (management of joint bodies, training of staff representatives, etc.). The funding is ensured by contributions from private employers (0.016% of payroll costs) and by the state. The decree defines the rules of how the fund is organised, how it operates and how the monies are allocated. This arrangement is intended to put an end to the lack of transparency in the social partners’ funding channels.

• Minimum wage’s application to truck drivers in transit suspended: The German minister of labour Andrea Nahles has decided to delay the decision on enforcing the legal minimum wage that became law at the beginning of the year vis-à-vis lorry drivers from other member states when transiting German territory (see press release, in German). The employers’ organisation IRU has called for an immediate moratorium (see press release, in English). For its part, the European Transport Workers’ Federation (ETF) judges the measure to be compliant with EU law and underscores that, until such times as there is a European policy to combat social dumping, the member states will continue to seek national solutions to fight social fraud in the transport sector (see Eurofound (2015) “EurWORK topical update – Pay – Q4 2014 – Statutory minimum wages in 2015“). The Commission is currently conducting an initial inquiry to verify the (in our view dubious) compatibility of this measure with EU law and in particular the free movement of services.

• Amendments to the Labour Code: On 6 February, the government adopted a draft law (see press release, in French), with the following aims: 1. To bring the legislation into line with EU law by adding “the notion of gender reassignment in general legal provisions on non-discrimination, in the Labour Code”, and in legislation applicable to civil servants  2. To guarantee, in the context of cross-border mergers, the same participation rights to employees outside Luxembourg as to those who were already working on national soil prior to the merger. In other respects, government passed a draft regulation transposing directive 2010/32 of 10 May 2010, which defines the measures to be implemented to protect employees against the risks associated with sharps injuries in the hospital and healthcare sectors.

• Programme for unemployed whose benefit rights have run out: The government has adopted a royal decree (in Spanish), approved by the social partners, which will allow it to offer unemployed persons who are no longer eligible for benefits or compensation to take part in work re-integration programmes for six months and receive an allowance of 426 euros.
  
  > Get more information about labour law developments from the Newsletter European Labour Law Network (in English) and about collective bargaining from the European Trade Union Institute’s “Collective Bargaining Newsletter” (in English).

IndustriAll presents its new guidelines for the negotiation of transnational agreements: The international trade union federation IndustriAll Global on 6 February presented its new guidelines for negotiating global framework agreements (GFAs). As well as referencing and recognising fundamental social rights guaranteed by various international documents, global framework agreements must: 1. Cover all company operations throughout the world without exception; 2. Include a strong and unequivocal commitment by the multinational company concerned that suppliers and sub-contractors adopt these standards for their workers; 3. Guarantee a commitment from the company to treat unions positively, and refrain from all anti-union activities and to remain strictly neutral concerning an employee’s choice for or against joining a union organisation; 4. Grant union representatives “reasonable” access to the workplace; 5. Contain an effective mechanism for implementation, and a procedure for binding dispute resolution. A standing working group is created to review current GFAs and provide an annual report on the status of the GFAs signed. The agreements must be translated into all working languages and disseminated to employees, managers, suppliers and subcontractors. These recommendations have already been respected in the global framework agreement of the Total group, signed on 22 January this year.

• Areva: To simplify the arrangements for following up European agreements signed between the Areva group and the IndustriAll Europe trade union federation (*), the two sides have concluded negotiation of a new European agreement in support of joint steering of the existing agreements. The draft agreement, submitted to the trade unions represented in the group and members of the federation for approval, stresses that social dialogue must cover the “group’s strategic orientations” in order to anticipate their “foreseeable effects on employment, occupations and skills”. The text also insists on recognition of the skills acquired when exercising a mandate as a staff representative and the need for equal treatment of these representatives alongside the other employees.
  (*) The agreements on “equal opportunities ” (and its amendment) as well as “professions and competences forecast and management” » are available on IR Share


• Scor: The French reinsurance group Scor SE (2,300 employees in 11 member states) on 29 January signed a European Charter on Professional Equality with the members of the Common European Companies Committee (CECC), representing the four European companies making up the Scor SE group. The document reviews all aspects of the working relationship linked to equal treatment (recruitment, training, wage trends, maternity) and creates tools (e.g. women’s networks, mentoring, awareness campaign) to ensure successful implementation of the agreement which, according to Roberta Iorizzo-Fard, CECC representative, “will make it possible to help all employees to give of their best and improve well-being at work on all levels”.

• Dana: The new EWC agreement (in German) signed on 18 November 2014 between the American automotive equipment supplier Dana (5,325 employees in Europe) and the president of the EWC states that transnational questions are those which concern two establishments in two member states, as well as those having a major impact on the European workforce, regardless of the number of countries affected. To obtain the organisation of an extraordinary meeting, the EWC’s request must be supported by members representing at least two countries and 25% of employees.

• Minimum wage: The Foundation for the Improvement of Living and Working Conditions (Eurofound) has published an article on the minimum wage in Europe as of 1 January 2015, in English, which shows the current minimum wage levels in the 22 member states and any increases compared to 2014. It also ventures to indicate the change in the minimum wage’s value “in real terms”, taking account of inflation. It appears that, in five countries, this has gone down.


• Severance pay: The Foundation for the Improvement of Living and Working Conditions (Eurofound) has published an info sheet on the statutory regulation of severance pay in the EU.


• Impact on employment of sanctions against Russia: The Foundation for the Improvement of Living and Working Conditions (Eurofound) has published a brief analysis in the ERM quarterly restructuring summary (in English) on job losses in European companies linked to the sanctions taken by the EU against Russia.

The Val Duchesse priory is situated in Auderghem, a municipality on the southern outskirts of Brussels, on the edge of the Sonian Forest. It was in this bucolic setting that, on 31 January 1985, European social dialogue was born, at the initiative of Commission President Jacques Delors. The outcome was the “Val Duchesse process”, which saw representatives of the trade unions and of employers become players in the formulation of European legislation during the construction of the single market.