IR Notes

The Commission made an unexpected U-turn before the Court of Justice of the European Union on 24 January during an oral hearing relating to a pending case concerning the compatibility of German legislation on co-determination with EU law (case C-566/15, Erzberger/TUI). Under German law, companies having more than 2,000 employees on German soil are obliged to make half of the seats on their supervisory boards available to employee representatives. As a consequence of this law, employees who are not based in Germany are permitted neither to vote nor to stand as a candidate for the position of employee representative on the supervisory board (see IR Notes 47 for further details). In the case at issue, a shareholder in the TUI travel company who is opposed on principle to co-determination takes the view that the law is discriminatory and infringes, in particular, the free movement of workers protected by article 45 of the Treaty on the Functioning of the European Union. In a memorandum dated 9 February 2016 submitted to the Court of Justice, the Commission took a similar line, suggesting to the Court that it should find that an infringement of the free movement of workers had occurred, which would result in the German system of co-determination being called into question. Following intense campaigning by the trade unions, which were outraged by the Commission’s position, the latter has now backtracked. On the day of the hearing, the Commission explained, according to its press releas, that “Employee participation is an important public policy objective and any possible restriction on the free movement of workers resulting from such rules can be justified by the need to safeguard systems of employee participation and their social objective. As a result, the Commission considers that the German rules as they stand can be considered compatible with EU law.” When asked, the Commission wished not to comment on “a pending case” and declined to state whether this was a one-off case or a genuine expression of faith in national employee participation arrangements. In fact it is the first time in a number of years that the Commission has given a social objective priority over an economic freedom of the EU. A Commission spokesperson stated that “it is completely normal for the Commission position to evolve as a case proceeds or to be modified once different arguments have been taken into account”. It now remains to be seen which position will be adopted by the Advocate General of the Court, whose conclusions are very often followed by the Court of Justice when it issues its ruling.
> On the same subject, also see Mitbestimmungs-Portal and Press release of the Hans Böckler Stiftung.

• Reform of port services finally adopted: The Council on 23 January finally adopted the regulation “establishing a framework for the provision of port services and common rules on the financial transparency of ports”. The document lays down specific provisions for the transfer of staff should the provider of port services change. (See Council press release).

Conference on the European Pillar of Social Rights: The European Commission on 23 January held a conference in Brussels to examine the outcome of the public consultation on the European Pillar of Social Rights. It is expected to present its proposal in March. However, Commissioner Marianne Thyssen already indicated certain aspects in her speech, such as the need to ensure decent working conditions for all workers – regardless of their employment relationship, allowing in particular the acquisition of portable social security rights. The Commission President, Jean-Claude Juncker, highlighted the establishment of a minimum wage in all the countries applying the Pillar, i.e. those in the euro area, but also the other countries choosing to follow the initiative (see Commission press release and video).

• European Parliament calls for an ambitious Pillar of Social Rights: The European Parliament on 19 January, by a large majority, adopted a resolution on a European Pillar of Social Right that demands specific measures to ensure that the Treaties’ social objectives are upheld and that poverty is reduced. The MEPs call for a “proposal for a framework directive on decent working conditions in all forms of employment, extending existing minimum standards to new kinds of employment relationships”.
  > On the same subject, also see the opinion of the European Economic and Social Committee (see press release).


• Worker protection against carcinogenic agents: Nine European employers’ organisations on 4 January sent a letter to the members of the European Parliament’s Employment and Social Affairs Committee asking them not to lower the occupational exposure limit values for carcinogens proposed by the Commission. The MEPS are scheduled to adopt a report on 28 February on the proposed revision of directive 2004/37 concerning worker protection against carcinogenic agents. According to the organisations, if the values are too low, they will be difficult for employers to enforce. Furthermore, the letter warns that if the Parliament were to adopt an over-protective position, this would have the opposite effect because it would make it difficult to reach an agreement with the Council and Commission, thus delaying the introduction of measures to improve worker protection (see press release). “This is a cynical letter,” comments Laurent Vogel, of the European Trade Union Institute, in response. “For example, the OEL value for hexavalent chromium proposed by the Commission and defended by the signatories is the equivalent of one case of lung cancer per ten workers exposed, while there are a million workers exposed to chromium VI in Europe! It is 25 times higher than the legal limit value in France or the Netherlands”.

• Interprofessional agreement adopted: The social partners on 11 January concluded their negotiation of an interprofessional agreement which was approved by the three trade union confederations (CSC, FGTB and CSLB) on 31 January. In particular, the text provides for wage negotiations in the sectors and at company level to envisage salary increases of up to 1.1% in the 2017-2018 period. The agreement revises the early retirement system and sets out an agenda for negotiations on a number of topics, including burn-out, work organisation, digitalisation and the collaborative economy (see news from RTBF, in French).

• OECD pushes for new labour market reforms: In a report (in English) published on 19 January, the OECD calls on Portugal to undertake further labour market reforms (see press release). The report finds that decentralising collective bargaining has had “mixed success” and recommends “further increases in the minimum wage” to address the problem of in-work poverty, while reducing employers’ social security contributions for minimum-wage workers in order to minimise any potential job losses. The report contains an annex giving a detailed overview of the reforms undertaken in the 2011-2015 period.

Self-employed couriers to be reclassified as workers: The Central London Employment Tribunal on 6 January found that a female courier employed by CitySprint should be regarded as a worker and not as an independent contractor. A ‘worker’ is a particular type of employee status in the UK. In fact, a ‘worker’ is neither an employee nor an independent contractor. Worker status is an intermediate category that gives access to certain rights, the most important being payment of the minimum wage, the right to paid annual leave, and a working week that does not exceed 48 hours. The judgement concerns a woman employed for more than two years as a self-employed contractor who did not receive a guaranteed wage, holiday pay or sick pay. The tribunal took the view that she should have been officially classed as a ‘worker” (see article in The Guardian newspaper).

Fnac: The management of the French retail chain Fnac, specialising in the sale of cultural and electronic products (27,000 employees), and a special negotiating body assisted by a consultant from Syndex appointed by the European trade union federation UNI Europa, on 6 December 2016 signed an agreement to set up a European works council. On transnational issues, the agreement uses the definition contained in the directive and states that the EWC is also competent “regardless of the number of states concerned” to deal with any issue that “potentially has a major impact on the European workforce or involves the transfer of activities between states”. As regards coordination between the EWC and the national employee representative bodies, the agreement provides for them to act concurrently “to carry out procedures”, while allowing the management and EWC to agree on an “alternative coordination arrangement” in certain cases. The EWC can set up working parties to examine cross-disciplinary or cross-sectoral issues. The EWC has 18 members, including 9 for France (73% of the workforce), 3 for Spain (which is about to break through the 10% barrier) and 2 for each of the other countries (Belgium, Netherlands and Portugal). The agreement provides for a member with observer status to be appointed for Monaco and Switzerland. A European trade union representative can be invited to meetings. The EWC executive committee can be mandated “for a defined time period and for a specific mission” to exercise certain of the EWC’s prerogatives. The EWC has an annual budget for consulting experts of € 20,000, excluding the commissioning of a specific expert report in the event of restructuring, as well as a budget to cover running costs of € 8,000, awarded in particular to cover internal EWC translations.

Suez: The management of the Suez group on 1 September 2016 signed a European agreement on job and skills management with representatives of the European works council and the European Federation of Public Service Unions. This third agreement at European level follows on from those on occupational health and safety and professional equality. The agreement sets up a “European observatory of occupations within the group”, whose task is to monitor regulatory, technological and commercial developments in order to assess their implications for employment and qualifications. The agreement also provides for a mapping exercise in order to identify occupations “likely to expand significantly”, strategic occupations, occupations facing recruitment difficulties, vulnerable occupations facing a “significant risk of job losses” and occupations whose conditions are unconducive to life-long careers (non-standard working hours, physically demanding jobs).

• OSM: The management of OSM Aviation (2,700 employees), the subsidiary of the low-cost airline Norwegian specialising in the recruitment and deployment of personnel in the civil aviation sector, on 6 January signed a memorandum of understanding with the International Transport Workers’ Federation that guarantees the exercise of trade union rights (see press releases of OSM Aviation and the ITF).

• Aviapartner: The European Transport Workers’ Federation (ETF) and its affiliates in Belgium, Germany and Italy on 7 January leafleted workers of Aviapartner (6,000 employees), a Belgian company specialising in airport ground handling services, to denounce the poor quality of social dialogue and the fact that the company is not meeting its legal obligation to inform workers through the European works council (see ETF press release).


• Prosegur: The international trade union federation UNI Global Union has, in Spain, filed a complaint with the OECD against the private Spanish security company Prosegur. The federation cites multiple breaches of the OECD Guidelines for Multinationals in Latin America and India (see press release).

The world of work and the digital revolution: The European Trade Union Institute held a conference bringing together a large number of experts in Brussels to discuss social issues related to the digitalisation of the economy. This subject is the growing focus of social dialogue, including at transnational level among several European works councils. The players involved in social dialogue will be able to peruse this issue of the Foresight Brief, which is dedicated to the conclusions reached at the conference. The conference report is available in English.