IR Notes

Noting the widespread recourse to telework and the emergence of a hybrid work model in the wake of the Covid-19 pandemic, at the Council meeting held on 14 June (see below), European Ministers of Employment adopted conclusions on telework that refer the issue of regulating telework to Member States. These States are invited to establish “national action plans or national strategies addressing the opportunities and risks related to telework”. They should consider “amending their policies regulating telework or issuing guidance where appropriate”, in particular with regard to health and safety, the organisation and monitoring of working time, effective checks by labour inspectorates, and allowances to cover the costs of teleworking. For their part, the social partners are invited to promote, either at sectoral or company level, “the importance […] of respecting the applicable rules on working time for teleworkers to allow them to effectively disconnect”. Indeed, “given the diversity of business models, sectors and jobs, for which a one-size-fits-all solution is not suitable, social partners play a central role in the negotiation, application and enforcement of rules related to telework”. The Twenty-Seven invite the Commission to “analyse […] the extent to which current social and labour law in the EU ensures decent working conditions for teleworkers and responds to their particular situation and challenges, including as regards the right to disconnect”. Consequently, no legislative initiative should be expected at EU level on this issue. Here too, governments are moving away from the position of the European Parliament, which has expressly called for an initiative concerning the right to disconnect.

Employment and Social Affairs Council : The first Council of European Ministers of Employment and Social Affairs held after the Porto European Social Summit appears to have kept its promises: speaking on 14 June, Nicolas Schmit (Photo), European Commissioner for Jobs and Social Rights, hailed this as “an outstanding day for the Portuguese Presidency” and a “special moment for social Europe”. His praise was prompted primarily by the adoption of a recommendation establishing a European Child Guarantee, to protect “children in need”, i.e. young people “under the age of 18 years who are at risk of poverty or social exclusion”. Member States are therefore recommended to ensure “effective and free access to high quality early childhood education and care, education and school-based activities, at least one healthy meal each school day and healthcare”. The policies proposed by the recommendations would be implemented by “national Child Guarantee Coordinators” appointed by each government. “We’ve moved from talk to action”, says Ana Mendes Godinho, Portuguese Minister of Employment and Social Affairs, with satisfaction. The Council also officially endorsed the progress made under the Portuguese Presidency on recent proposals for a directive on adequate minimum wages (see progress report) and on pay transparency (see progress report), as well as on the long-standing proposal for a directive on implementing the principle of equal treatment between persons (see progress report). The Council also adopted conclusions on the socio-economic impact of COVID-19 on gender equality, on the strategy for the rights of persons with disabilities 2021-2030 and on telework (see Lead story). Lastly, ministers debated the challenges posed by social dialogue and collective bargaining, describing the different approaches to this issue adopted by their respective countries. Nicolas Schmit confirmed that the European Commission will take an initiative in this area by the end of 2022.

• Employment market and migration: On 11 June, the European Commission launched the “Talent Partnerships” initiative, prepared within the framework of the New Pact on Migration and Asylum, which “will help to address skills shortages in the European Union and to strengthen mutually-beneficial partnerships on migration with third countries”. The aim is to match the skills of workers from countries outside the EU with the labour market needs inside the EU (see press release and Talent Partnerships website).

Posting of temporary workers : : The Court of Justice has delivered its ruling on a sensitive case concerning the posting of temporary workers by a Bulgarian temporary employment agency (‘TEA’) to a client located in Germany (see Posted workers). The Bulgarian authority responsible for issuing an A1 certificate to posted workers, in order to prove they are affiliated to the Bulgarian social security system, refused to issue such certificates to the TEA on the grounds that it did not carry out “significant activities” on Bulgarian territory, and therefore did not qualify for the right to post employees. The European Commission submitted that for TEAs to be able to post temporary workers, it sufficed for TEAs to have employees who work in the sending State and to recruit in that State workers who will be made temporarily available to hirers. If that condition is met, there is nothing to preclude TEAs from engaging workers in order to send them only to hirers established in other Member States. For their part, the Belgian, Bulgarian, Estonian, French, Polish and Finnish governments all believed that an agency must carry on a significant proportion of its worker placement business for undertakings established in the sending State, i.e. in this case, Bulgaria. The aim here is to prevent the emergence of a form of social dumping by setting up “letterbox companies” in countries with low social costs, with the aim of posting workers to countries where labour costs are higher. The Advocate General of the CJEU had submitted an opinion that was favourable to the Commission’s position (CJEU, Opinion, 10 December 2020, Case C-784/19, Team Power Europe, but prompted a stern warning from the trade union movement, and in particular from IndustriAll Europe and the EFBWW (see joint press release). The Court of Justice unambiguously disavows this opinion and notes that “to allow temporary-work agencies exercising the freedom to provide services to benefit” from the advantages offered by the directive regarding posting of workers, “when they orientate their activities of supplying temporary agency workers exclusively or mainly to one or more Member States other than that in which they are established would be likely to encourage those undertakings to choose the Member State in which they wish establish themselves on the basis of the latter’s social security legislation with the sole aim of benefiting from the legislation which is most favourable to them in that field, and thus to allow ‘forum shopping’”. Furthermore, accepting that situation “would have the effect of creating a distortion of competition between the various possible modes of employment in favour of recourse to temporary agency work as opposed to undertakings directly recruiting their workers, who would be affiliated to the social security system of the Member State in which they work.” Consequently, to benefit from the posting rules, a temporary-work agency established in Member States must “carry out a significant part of its activities of assigning temporary agency workers for the benefit of user undertakings established and carrying out their activities in the territory of that Member State”(CJEU, 3 June 2021, Case C-784/19, Team Power Europe). This decision was “applauded” by the EFBWW (see press release).

Equal pay for “work of equal value” : In a judgment delivered on 3 June, the EU Court of Justice ruled on a dispute involving 6,000 female Tesco shop workers, who accused the retail group’s management of paying them less than their male colleagues employed in warehouses. In this judgment, the Court of Justice: 1) confirms that Article 157 TFEU on the principle of equal pay for male and female workers (see Equality between women and men) “imposes, clearly and precisely, an obligation to achieve a particular result  and is mandatory as regards both ‘equal work’ and ‘work of equal value’”, as invoked by the female workers. This principle must be adhered to by “all agreements which are intended to regulate paid labour collectively, as well as to contracts between individuals”; 2) states that Tesco group management may be regarded as the “single source” of the discrimination, even though workers are employed in the various establishments (CJEU, 3 June 2021, Case C- 624/19, Tesco Stores).

• Construction : The European social partners in the construction sector (EFBWW and FIEC) have published a joint statement on third country national workers and companies in the EU construction market, aimed in particular at Chinese companies owned by the Chinese State and operating in the EU.

Due diligence : On 11 June, Parliament definitively adopted the law on due diligence exercised by multinationals (see IR Notes 159). This law will be applied progressively: to companies with more than 3,000 employees from 2023 onwards, and to those with more than 1,000 employees from 2024 onwards. In particular, it obliges them to perform an analysis each year to identify risks related to human rights and environmental issues, both in their own field of activity and those faced by their direct suppliers. It is however a “compromise [that] falls significantly short on many aspects”, according to the Alliance of 18 organisations campaigning for this law, meaning that it “is not effective enough and cannot just serve as a model for a European supply chain law.” (see analysis published by the Alliance and press release issued by Parliament).

Poverty among the young : According to the latest report published by the Inequalities Observatory, the poverty rate among 18-29 year-olds rose from 8.2% in 2002 to 12.5% in 2018, i.e. by over 50%. The age bracket at most risk of being poor is that of young adults, whose situation has deteriorated furthest over that fifteen-year period. Moreover, 52.7% of young people aged 15 to 24 and in employment, had a precarious contract in 2019, i.e. 5.7 points more than in 2009.

Contrasting results for trade union membership : The public statistics on trade union membership published on 27 May highlight a fourth year of rising trade union membership: the proportion of employees who belong to a trade union rose from 23.3% in 2017 to 23.7% in 2020 (up 0.2 points compared to 2019). This rise was attributable to a substantial increase in public sector membership (up 228,000), whereas in the private sector there was a significant fall: it lost 110,000 members in one year, mainly due to job losses and lost income linked to the Covid-19 crisis, according to the TUC confederation (see press release).

The “new normal” : In response to questions put by IR Notes, a number of EWC secretaries have thrown light on how the “new normal” is being introduced within their company, i.e. by describing the new methods of work management being applied in the wake of the Covid-19 pandemic. The use of teleworking is clearly one option being chosen by businesses. A joint declaration on crisis situations has been adopted at Generali (see IR Notes 165), and this is due to be followed by negotiations regarding the “new normal”. A negotiation on teleworking is under way at BNP Paribas (details are awaited on cross-border teleworking). However, negotiations are under way mainly at local level, as is the case at Orange and Stellantis. At the Stellantis group, the target is to achieve a target of 70% teleworking in services, which in turn is leading to a cost optimisation policy (this is also the case at Orange): cutting the amount of office space, increasing the amount of available surface area by using “hot desking” arrangements, and introducing “self-cleaning”, which also cuts the cost of maintenance services, and preventing employees from personalising their desks. The group is opting for a “full digital” policy, with the removal of office cabinets and hardware, increased use of self-administration tools (to book a desk or a parking space, etc.) and scaling back international travel in favour of videoconferencing. Worthy of note at Orange is “an initiative launched by the DRH group”, explains EWC secretary Guy de Trazegnies, “which is bringing together the EWC, the France group works council and French trade unions to debate “different ways of working”, with interventions at regular intervals by experts in various specialities”.

• EWCs in Croatia: As part of an EU-funded project, the Institute for Development and International Relations (IRMO) in Croatia has published a book based on the results of field research involving Croatian EWC members. This is the first comprehensive research study on EWCs in this country: it should contribute to a better understanding of their position and their importance in terms of industrial relations (IRMO (2021), Puljiz, J. and Rukavina, I. “European Works Councils in Croatia: Experiences and Opportunities for further Development”).

A merger and a temporary body : Following last year’s successful takeover bid, by the IT consulting and outsourcing services group Capgemini SE, for Altran (50,000 employees), the Altran group of companies joined Capgemini in spring 2020, thus creating an entity with a global workforce of 270,000. Capgemini management subsequently altered the composition of its international works council, which had been created in 2001, to cover incoming employees from Altran, and decided that the Altran EWC should be abolished, “as EWC provisions are not intended to apply within groups whose parent company” is constituted as a European company (SE). Management then set up a special negotiating body on 15 October 2020, to negotiate a new agreement on employee involvement in the SE. At the request of Altran’s employee representatives, who denounced the abolition of their EWC at a time when they were being affected by reorganisations, management agreed to negotiate a second agreement “maintaining temporary and selective representation for information transfer and monitoring purposes (…), attached to the international works council’s future executive committee”. This body is due to be created in June, once the Altran EWC has been dissolved, subject to the new agreement on Capgemini SE worker involvement being signed at the same time. Capgemini management and the SNB thus signed two agreements on 23 April: firstly an additional and temporary Memorandum of Understanding relating to the Altran information transfer and monitoring committee, and secondly an agreement on the Capgemini SE international works council. The international dimension is conferred by the article on the council’s composition, which includes invited members from each of the group’s four regions (Latin America, North America, Asia-Pacific and Africa) and two countries: India and the United Kingdom. The international works council meets four times a year, with two of these meetings being held via videoconferencing. The consultation will “be held prior to the final decision to implement the plan being taken, in order to guarantee the principle of useful effect.” It should be noted that not all SNB members have signed these agreements: in particular the four French trade unions, some of which have announced that they wish to challenge the agreements in court, have withheld their signature.

Human resource planning : On 8 June, the management of the aerospace group Safran and the trade-union federation IndustriAll Europe signed a European framework agreement on the development of skills and safeguarding of career paths. A previous agreement was signed in 2015, but the renegotiation was delayed by the Zodiac group takeover and the Covid-19 crisis (see European Framework Agreement). This agreement, which also covers Switzerland and the UK, aims to tackle the dual challenge posed by speeding up the group’s digitalisation process on the one hand, and by large numbers of group employees reaching retirement age in the next five years, on the other. The agreement stipulates that all employees will have to receive at least 26 hours’ training per annum by 2025, with an intermediate stage of 18 hours in 2022. The agreement establishes a monitoring committee made up of its signatories, which will track the progress of the indicators listed in appendix (number of hours’ training performed, broken down by country, company and field of activity; number of e-learning training courses offered; number of positions filled by way of internal mobility; number of development interviews conducted per site and percentage conducted in relation to the site’s total workforce, etc.). Members of this committee will also sit on a “vocational specialisations and skills observatory”. This will be a “forum for discussion and dialogue”, which will “come up with creative proposals” and can welcome “internal or even external experts to enrich and inform the work undertaken”. It will prepare an annual report setting out “the basis for quantitative evaluation and qualitative assessment of skills within the Safran group’s European business”. Corinne Schievene, the EWC secretary who negotiated the agreement on behalf of the CFDT, is delighted with the outcome: this agreement adds a section to the 2015 version, in response to the difficult economic climate in which the sector finds itself, offering “adaptation and support measures in the event of problems that may have adverse effects on employment”. She emphasises that “these measures provide guarantees for European employees, even though we haven’t managed to obtain any undertakings to maintain employment” (see press releases issued by IndustriAll Europe and Safran).

Minimum wages in the EU : The European Foundation for the Improvement of Living and Working Conditions (Eurofound) has published its annual review of minimum wages in the European Union. At a time when the European Parliament is debating the proposed EU directive on adequate minimum wages, Eurofound offers a comprehensive and detailed overview of the situation, while at the same time setting out the positions held by social partners and governments with regard to this proposal. The study emphasises that the minimum wage is not the only bulwark against poverty: in 2018, 23% of minimum wage earners in the EU reported difficulties or great difficulties “in making ends meet” (compared to 11.5% among the rest of employees). The authors urge people not to limit their debates to the adequacy of minimum wages in relation to median wages, as these can quickly end up in technical discussions “without addressing the real issue: whether low-paid workers who are earning the minimum wage are able to afford a decent standard of living that includes the ability to provide for dependants”. In Eurofound’s view, “policymakers should consider additional indicators of adequacy, including subjectively reported ones (for example, being able to make ends meet) and objective ones (such as material deprivation) to identify the extent to which basic goods and services are or are not affordable for those earning the minimum wage.”

Strikes in Europe : Kurt Vandaele, a researcher at the European Trade Union Institute (ETUI) has prepared an enlightening series of maps showing the trend for the number of days’ work lost due to strike action in the various Member States, and at EU level, during the periods 2000-2009 and 2010-2019 (see photo opposite, where the countries that have experienced the most strikes are shown in red) (see Strike action at EU level). Another infographic shows the trend for the number of general strikes. Data for each country can also be accessed.