IR Notes

Abandoning the use of fossil fuels to produce energy is one of the measures intended to reduce the impact of human activity on the earth’s climate. The agreements negotiated between the social partners in recent years foreshadow forthcoming negotiations that will affect other sectors of activity. For example, in October 2018, the Spanish government and the trade-union federations UGT Fica and CC.OO Industria signed an agreement on a just transition in the coal mines that will have to close pursuant to the EU’s decision (see press releases issued by UGT Fica and CC.OO Industria). The agreement forms part of a just transition deal, and as such has been praised by IndustriAll Global Union and IndustriAll Europe. The German Parliament recently (on 3 July) passed the law on ceasing the use of coal by 2038. This law provides for the creation of a compensation fund for the benefit of employees who are aged at least 58, and who lose their job in regions affected by the closure of lignite mines and lignite-fired power stations. This fund, which is financed by the federal State, will be used to pay a transition allowance, lasting no more than five years, to the employees concerned until they reach retirement age. Around 5 billion euros has been paid into the fund. To benefit from the financial support provided for by law, several companies have negotiated agreements to safeguard the jobs of the employees affected, and to encourage their oldest workers to accept voluntary redundancy. For example, on 28 August, the management of the energy group RWE signed an agreement with the trade unions IG BCE and Ver.di, which will continue to be applicable to its 10,000 employees until the end of 2043. The agreement prohibits compulsory redundancies and provides for a number of measures: a voluntary redundancy scheme under which the levels of compensation paid will vary according to an employee’s age, length of service and a number of social factors; recourse to various forms of reduced working time; recourse to training while employees continue to receive their wages; the creation of a transfer company (to prepare for outplacements) to which an employee can be transferred for a one-year period on 80% of their latest gross wage; an increase in the transition allowance financed by the adjustment fund to cover at least 80% of the employee’s latest net wage; and payment of a one-off 12,000 euro lump-sum bonus (gross value) to everyone who agrees to join this scheme during the two-week period following signature of the agreement (see Ver.di’s press release). An agreement of the same type has also been signed at Onyx and Uniper (4,000 employees in Germany) (see Ver.di’s press release). All of these texts need to be examined closely with a view to reaching a balance in future agreements between the various interests involved. However, these agreements should also concentrate the minds of decision-makers: what is deemed socially acceptable is so, because the State is involved in financing the schemes concerned. The ecological transition cannot be socially acceptable without proper financing.

Publication of the “mobility package” : Three texts intended to improve drivers’ working conditions and to reduce the risk of unfair competition in the road transport industry (see IR Notes no. 146, Lead Story) were published in the OJEU on 31 July. These are as follows: 1° Regulation (EU) no. 2020/1054 of 15 July 2020 as regards minimum requirements on maximum daily and weekly driving times, minimum breaks and daily and weekly rest periods, and positioning by means of tachographs. 2° Regulation (EU) no. 2020/1055 of 15 July 2020 on adapting to developments in the road transport sector. 3) Directive 2020/1057 of 15 July 2020 laying down specific rules for posting drivers in the road transport sector.

• Free movement during the era of Covid-19 : On 4 September, the European Commission adopted a proposal for a Council recommendation seeking to guarantee that all of the measures taken by Member States to restrict free movement due to the coronavirus pandemic are coordinated and clearly communicated at EU level (see press release).

SURE initiative : On 24 August, the European Commission submitted proposals to the Council for decisions to grant financial support worth 81.4 billion euros (of the 100 billion budgeted) to 15 Member States under the SURE instrument. This is the temporary mechanism that allows Member States to access loans granted at favourable interest rates for the purpose of supporting or setting up short-time work schemes (see press release).

• The right to disconnect: In a motion for a resolution submitted on 28 July, MEP Alex Agius Saliba (S&D) called on the European Commission to embark on an initiative to establish a right to disconnect, in favour of European employees. If the text is adopted at a plenary meeting, the Commission will have to state whether it plans to take such an initiative or alternatively, justify why it is not planning to venture into this area.


• Industrial cleaning: At its plenary session scheduled for 16 to 18 September, the European Economic and Social Committee is expected to adopt an own-initiative opinion on “Public procurement as a tool to create value and dignity in work in cleaning and facility services”.

Minimum wage : The Executive Committee of the European Trade Union Confederation has called on its affiliates to vote on its draft response to the Second Phase Consultation launched by the European Commission on the introduction of a fair minimum wage in the European Union. In this text, which was approved by a large majority of its affiliates (85% for, 11% against and 4% abstentions), the ETUC demands in particular that Member States should not be allowed to fix their statutory minimum wage floors below a threshold of decency; it also calls for an end to unfair practices such as employer deductions from the statutory minimum wage, and for collective bargaining rights to be promoted in each Member State. At the same time, without trying to disguise the fact that there is a lack of unanimity on this text among its members, the ETUC has launched an action plan to support the demands it is submitting to the EU institutions and Member States, calling for the support of its affiliates.

• “Restructuring” directive: In an article published in Social Europe, the two Deputy General Secretaries of the IndustriAll Europe union federation, Isabelle Barthès and Judith Kirton-Darling, sound “the klaxon to warn policy-makers and politicians of the coming tide of company restructuring”. To address this issue, they have revived the resolution passed by the European Parliament in January 2013, at the initiative of Spanish MEP Alejandro Cercas, with the support of the late Fernando Vasquez, calling on the European Commission to submit “a proposal for a legal act on information and consultation of workers, anticipation and management of restructuring”. In the authors’ view, it is high time that work on this project resumed and action was taken, before the coming tsunami of restructurings reaches us.

Wearing of the Islamic veil : The Federal Employment Court has issued a ruling concerning wearing of the veil at work. The case involved an IT worker who claims to be a devout Muslim and wears a scarf as an expression of her religious beliefs. She applied for a job at a school in the public education sector in the State of Berlin. Following her interview, a female employee of the education authority asked her a number of questions about her position on Berlin’s so‑called neutrality law, which in general terms bars teachers from wearing garments with religious connotations, while on duty. The claimant then declared that she would not remove her scarf in class. After her application was rejected, she claimed that the State of Berlin had discriminated against her on the grounds of her religion, in breach of German anti‑discrimination law (AGG). The Federal Court held that the neutrality law establishes a blanket ban that cannot comply with the requirements of either the AGG or the German Constitution, or with EU law and the EU Charter of Fundamental Rights. The IT worker was held to be the victim of discrimination and is entitled to receive compensation. In the Court’s view, the ban on wearing Islamic scarfs should only apply in the event of any concrete threat to peace at school or the neutrality of the State, which the authorities could not demonstrate here. Accordingly, this blanket ban constitutes a disproportionate restriction on freedom of religion (Bundesarbeitsgericht, ruling of 27 August 2020 – 8 AZR 62/1, see press release).

Changes to the short-time working scheme : In late July, the Austrian social partners (ÖGB, WKO) and the government agreed a new short-time working scheme that will remain in force until 30 March 2021. The length of working time can be reduced by between 30 and 80%. Employees will enjoy a remuneration equal to 80%, 85% or even 90% of their net wage, based on the level of their gross wage. The social partners have made it clear that they will check much more carefully whether the company applying to benefit from this scheme really does have an economic justification for doing so. Under the new scheme, any employees placed on short-time working must be prepared to undergo additional training. The trade union confederation ÖGB has also suggested a “90 for 80” working time model: if four employees agree to voluntarily reduce their working time to 80% (i.e. from 40 to 32 hours), a fifth person can then be taken on, to work 32 hours a week. The wages of the employees concerned should be cut only to a level of 90% – the idea is for the difference to be made up by the public employment department (see article in Kompetenz). The proposal has aroused hostility among employers, and for the moment, the government has taken no further action.
> Find out more: video of the press conference broadcast by the ÖGB.

Favourable opinion regarding an acquisition : On 28 August, the European Works Council of the Canadian group Bombardier adopted a positive opinion, relative to the Alstom group’s proposed acquisition of Bombardier’s transportation division – Bombardier Transportation. The European Commission gave the green light for this proposed acquisition on 31 July. The European Works Council’s opinion stated that it was satisfied with the process and with the quality of the “information shared by management with the Select Committee, the experts and the EWC”. The European Works Council held a series of meetings during this process, including a meeting with the management of Alstom and the representatives of the Alstom European Works Forum (EWF). The Select Committee met each week with the Syndex experts to discuss the information obtained in detail. In terms of substance, Alstom’s offer is presented as “the best solution” given the limited overlap between the types of production involved, the significant technological complementarity and the sound finances of the acquirer. The European Works Council is worried about the company’s responses to the concerns expressed by the Commission affecting three businesses, and has obtained management’s agreement to organise three specific working groups. The Council also notes that the acquisition will surely result in a reduction in headcount, notably in the support functions. It is therefore once again demanding that Alstom’s management guarantees that the integration process will proceed without any compulsory redundancies or site closures.

Compliance with the “before/after” principle : In a ruling on 18 August, the German Federal Employment Court referred a question to the EU Court of Justice for a preliminary ruling, concerning the right of the IG-Metall and Ver.di trade unions to each appoint a trade union official from outside the company, to join the employee representatives on the supervisory board of the software group SAP SE. According to the Federal Court, where a European company (SE) is created by converting a limited company that is subject to joint management based on equal representation of management and employees, Article 21 (6) of the German law on worker involvement in the SE stipulates that a separate selection procedure (put forward by the trade unions) for workers’ representatives on the supervisory board, must be guaranteed in the agreement on worker involvement in the SE (see press release). However, a provision contained in the agreement signed in 2014 between SAP management and the special negotiating group, allows the number of directors to be cut from 18 to 12, while at the same time abolishing the right granted to trade unions to appoint two representatives of their own. SAP believes that these measures are lawful, notably by virtue of the principle of autonomy of the parties, which governs how agreements on worker involvement in the SE are negotiated. However, the Federal Court takes the view that this rule governing trade union appointments should have been complied with, and calls on the EU Court of Justice to check whether German law is compatible with Article 4, paragraph 4, of Directive 2001/86/EC of 8 October 2001, which states that where a SE is created by way of conversion, the agreement on worker involvement provides for application of the “before/after” principle regarding all aspects linked to worker involvement, i.e. the agreement should provide for a level that is at least equivalent to the existing level within the company that is to be converted into a SE. The decision has been welcomed both by IG Metall (see press release) and Ver.di (see press release)
> Find out more: The press release issued by the Hans Böckler Foundation and a study that it recently published on the various strategies put in place by German companies to escape employee representation in management, including conversion into a SE (see press release).

Covid-19 crisis : On 3 August, the management of the food manufacturing group Danone and the international trade-union federation IUF committed to opening negotiations on measures to support workers and mitigate potentially negative employment consequences emerging during and beyond the Covid-19 pandemic. The joint declaration recognises that any future agreement will need to focus on identifying and protecting the most vulnerable workers. It will also have to give priority to upskilling programmes that provide employees with new skills to facilitate internal repositioning within Danone. During this time, which could  last up to two years, Danone would guarantee that workers retain their Danone employment contracts, salaries and relevant benefits (see IUF press release).