IR Notes

Is the von der Leyen Commission’s flagship “social” measure set to be wiped off the map by a court ruling? This is what may happen in a few months’ time, if the Court of Justice accepts the opinion of its Advocate General, delivered on 14 January, on the case brought by Denmark against the European Parliament and the Council of the EU, concerning Directive 2022/2041 of 19 October 2022 on adequate minimum wages in the EU (AMW Directive). It had been known from the outset that there was a risk of this directive being annulled.
In terms of substance, the legal problem is fairly straightforward. The areas over which the EU has competence to legislate are defined in the Treaty on the Functioning of the European Union (TFEU). In the field of social affairs, they are set out in Article 153 paragraph 1: for example, it can act to “protect workers’ health and safety”, improve “working conditions” and protect “workers where their employment contract is terminated”. On this legal basis, it can pass directives imposing minimum requirements on its Member States. On the other hand, as stated in Article 153 paragraph 5, the EU’s competence “shall not apply to pay, the right of association, the right to strike or the right to impose lock-outs”. That is why there are no directives regulating the right to strike or indicating how collective bargaining should be conducted.
So, how can the adoption of this directive on the minimum wage, which the directive itself defines as “a minimum remuneration” (Art. 3 para. 1 of the directive), be justified? The approach adopted by the EU legislature has been to select Article 153 paragraph 1 b as the legal basis for the directive, with a view to “improving living and working conditions in the Union, in particular the adequacy of minimum wages for workers in order to contribute to upward social convergence and reduce wage inequality” (see Working conditions). As the Advocate General notes, the legislature was extremely careful in its wording of the directive, indicating that it “neither aims to harmonise the level of minimum wages across the Union nor does it aim to establish a uniform mechanism for setting minimum wages”. He emphasises that the wording adopted shows that the legislature “did not ignore that […] it was walking on thin ice”. This risk of moving beyond the EU’s sphere of competence is all the more sensitive in that the other aim of the directive is to promote collective bargaining, which is itself an excluded subject, given that the EU is prohibited from intervening in the “right of association”, from which the right to conduct collective bargaining is derived. In conclusion, he takes the view that, since the object of the AMW Directive is to “regulate ‘pay’”, it “directly interferes with the ‘pay’ exclusion in Article 153(5) TFEU”. Consequently, the EU legislature “was not competent to adopt that instrument and, thus, acted in breach of the principle of conferral laid down in Article 5(2) TFEU”. This finding should lead “the Court to conclude that the AMW Directive must be annulled in full”.
This was music to the ears of the Danish Employment Minister, Ane Halsboe-Jørgensen, who had argued that the EU had strayed onto “thin ice”, and called on the Court of Justice to annul the directive, three months after its adoption, a move that was immediately supported by Sweden. She says she will now await “the final verdict of the Court of Justice, but in football parlance, we’re 3-0 up at half-time” (see press release). The Danes’ intransigent position reflects the opposition of some Nordic trade unions to this directive, which they regard as direct interference in activities that are the preserve of the social partners: setting wages and collective bargaining. The directive also reopens the wounds left by the Court of Justice ruling in the Laval un Partneri case (see Laval case) in 2007, which held that a Swedish trade union was not entitled to blockade a building site, in order to force “a provider of services established in another Member State to enter into negotiations with it on the rates of pay for posted workers and to sign a collective agreement”. This fear of EU interference in the Nordic social model even came close to prompting several Nordic trade unions to withdraw from the European Trade Union Confederation (ETUC), whose former President Laurent Berger viewed the adoption of this directive as “a victory” and “good news for European workers”. The Advocate General’s opinion is a huge let-down for the ETUC (see Social update). It is now up to the Court of Justice to pronounce on whether or not, in matters of law, the EU legislature has flouted the Treaty. And the verdict may well be a painful one.

Reactions to the AG’s opinion on the “adequate minimum wages” directive : The European trade union movement is hugely disappointed with the opinion delivered by the Advocate General of the EU Court of Justice (see Lead story). The ETUC has expressed indignation: “the most important piece of workers’ legislation at EU level in a generation may be under threat”. ETUC General Secretary Esther Lynch adds: “This opinion, if confirmed, would be a huge blow to working people and their trade unions and would completely undermine the objective of social progress enshrined in the EU treaties” (see press release). European trade union federations, such as the EPSU public service workers’ union, which recalls the precedent set by the Laval and Viking rulings, support the ETUC’s position, pointing out that these “massively undermined collective bargaining and pro-EU sentiment”. This would once again be the case if the Court of Justice followed the Advocate General’s opinion (see press release). “We expect the CJEU to uphold its longstanding case law and confirm the directive in its entirety, in line with the legal opinions of the Parliament, the Council, the Commission and the vast majority of member states”, explains Oliver Roethig, Regional Secretary of UNI Europa (see press release). At national level, a number of confederations have also warned the Court of Justice that if it annuls the directive, “the objective of social progress enshrined in the EU treaties would be completely undermined, and this in turn would place working-class support for the European project at greater risk”, in the words of the Spanish trade-union confederation CCOO (see press release). However, this view is not shared by the Nordic confederations (with the exception of the Finns, who support the ETUC’s position). Flemming H. Grønsund, Vice-President of the Danish confederation FH, is highly optimistic: “It’s still too early to celebrate. We’re now waiting for the Court of Justice to issue its final decision, but of course I’m feeling extremely confident after today’s consultative opinion!” (see press release). There was a similar reaction from the Swedish trade union confederation LO and the Swedish employers. LO’s Confederal Secretary Veli-Pekka Säikkälä, says that “if the Court reaches a different conclusion from the Advocate General, there may be consequences for Sweden’s membership” (see article in Lag&Avtal).

“Omnibus” directive : On 26 February, the European Commission is due to unveil an “Omnibus package”, which is expected to include a proposal for a directive and a communication (see College of Commissioners agenda). This is in response to the concerns expressed by Heads of State and of Government, following the Draghi report, which blamed the EU’s economic slowdown in part on excessive regulations and reporting obligations (see IR Notes 236). The purpose of this legislative initiative is therefore to group together several amendments and revisions of existing laws under a single proposal, in the name of simplifying and combatting the bureaucracy allegedly hampering EU companies. In point of fact this will mean the Commission unravelling a number of texts adopted during its previous term, especially within the framework of the Green Deal on sustainable transition.  It therefore plans to rationalise or simplify the regulations introduced by: 1/ the Corporate Sustainability Reporting Directive (CSRD), which strengthens the transparency obligations applicable to companies, with regard to their environmental, social and governance (ESG) impacts; 2/ the green taxonomy regulation, which defines criteria that can guide investors and promote sustainable finance by helping to identify sustainable economic activities; 3/ the directive on European due diligence (CSDDD), which obliges companies to identify, prevent and mitigate the negative impacts of their activities on human rights and the environment within their value chains.

Reactions to simplification proposals : In response to the moves to challenge the texts resulting from the Green Deal (see above), on 14 January, trade unions and NGOs published a Joint statement on the Omnibus proposal, arguing in favour of maintaining these directives and regulations, which encourage a “race to the top”, to protect human rights, the environment and climate. In France, the College of Sustainable Development Managers (C3D), a grouping of almost 400 CSR managers employed by large corporations, expressed its support for these European laws in a letter to Ursula von der Leyen (not published), stating that companies that lag behind in meeting their commitments (there are reported to be more such companies in Germany than elsewhere) should not be allowed to prosper in this way (see article written by our colleagues at Novethic).

Adolescent labour : With effect from 1 January, the government, with the agreement of the parties that support it and the social partners, has amended a number of rules to allow young people aged 13 and over, to work during their free time. The government deplores the fact that there are currently 70,000 fewer young people in the labour market than in the 1980s. “It’s fundamentally healthy and stimulating for our young people to have a part-time job, earn their own money and gain experience”, insists Minister of Employment, Ane Halsboe-Jørgensen. So, once they reach the age of 13, young people will now be able to take on a growing number of tasks, such as manning a supermarket check-out desk, reading aloud to children at a day nursery or working as a kitchen assistant at an old people’s home (see list of activities). From now on, young people aged 13 and over will be allowed to operate non-hazardous machinery (e.g. ice cream makers, cash registers, etc.), while those who are aged 15 and have completed their primary school studies will be allowed to work irregular hours in several sectors, e.g. in hospitals, old people’s homes and factories. By way of example, this might involve hospital cleaning work, starting at 4am in the morning, or working in a warehouse until midnight, checking goods in and out (see press release).

Ionising radiation : A decree of 30 December 2024 amends the provisions of the Employment Code, concerning protection of workers from ionising radiation risks. Since 1 January, in cases involving the discovery of ‘orphan’ radioactive sources or pollution by radioactive substances necessitating a clean-up operation (decontamination sites), the employer must demarcate a “radiological safety zone”. On the periphery of this zone, the dose equivalent rate must remain below 0.5 microsieverts per hour. From 1 January 2027 onwards, the employer will also have to designate an employee holding the position of “radiation protection operative”. This person will be placed under the technical supervision of the “radiation protection adviser”. Radiological monitoring is stipulated for certain employees who have to access at-risk zones, to ensure that their exposure remains within the prescribed doses (in particular, below 6 millisieverts during the course of 12 consecutive months, for exposure to ground radon).

New agreement : On 13 December 2024, the French group Apave (16,500 employees), which specialises in risk management, signed a European Works Council agreement replacing the initial text concluded in 2023, following a review of its operation, held for the first time. The group, which has expanded its geographical scope in recent years, now has 10,852 employees who come within the scope of the EWC, in 12 countries. The main countries are France (8,804 employees), Spain (1,367) and Italy (221). The EWC will hold two plenary meetings a year, the first one in videoconferencing format. The second will take place in one of the various countries represented on the EWC. The preparatory meeting may take up two days. The EWC is competent to deal with proposals that concern at least two countries and at least 30 employees in each of these two countries. The text provides for 5 training days per term of office and permission to use the services of the accountancy expert appointed by the Apave Group Committee for the purpose of analysing financial statements. Its members will be granted an annual time credit, amounting to 25 hours for ordinary members, 35 hours for select committee members and 55 hours for the secretary.

Toolkit for the transport sector : The European Transport Workers’ Federation (ETF) has updated its practical guide, prepared in collaboration with Syndex, and has published a number of multilingual training videos, which are intended to support trade unions and employee representatives with the task of setting up a EWC or enhancing the operation of existing EWCs (see press release and access to videos).

Artificial intelligence : The manifesto “For a social dialogue serving the proper uses of AI and a new stage of social progress in companies and administrations”, published on 7 January, is the fruit of the Dial-IA project. This pioneering initiative is intended to raise social partners’ and employees’ awareness levels, in order to promote social dialogue regarding AI in the workplace. The project is coordinated by France’s IRES research institute, with the support of the Ultralaborans association and four French trade unions (CFE-CGC, CFDT, FO-Cadres and Ugict-CGT), and is co-financed by the Agence nationale pour l’amélioration des conditions de travail [‘National Agency for the Improvement of Working Conditions’]. The manifesto is the outcome of 18 months’ work undertaken by a team of around 50 experts, including trade union representatives, employers, researchers and representatives of the authorities. A toolbox has been created for employee representatives, with resources that will help to identify the challenges involved and to prepare social dialogue strategies for dealing with this subject. A further significant AI event will also be taking place in Paris next month (6 to 11 February), with the Artificial Intelligence Action Summit.