IR Notes

On 8 November, at an informal Council meeting in Budapest, the Twenty-Seven adopted a Declaration on the New European Competitiveness Deal, drawing the lessons from two recent reports: “Much more than a market”, written by Enrico Letta, and “The future of European competitiveness” by Mario Draghi (see IR Notes 236). EU leaders say they will “seize the wake-up call” contained in these reports, and they are determined to “urgently close the innovation and productivity gap, both with our global competitors and within the EU”.  However, they remain excessively cautious when it comes to identifying exactly what resources will be on the table. They acknowledge that “the competitiveness challenges we face will require significant investment, mobilising both public and private financing”. The usual instruments (Multiannual Financial Framework, Capital Markets Union, European Investment Bank) are listed but there is nothing about a major EU loan, which is the only realistic way of funding innovation. The leaders simply promise to “explore the development of new instruments” and to continue to “work towards the introduction of new own resources”. This commitment is out of step with Mario Draghi’s call for massive investments, amounting to EUR 800 billion per year, to fund the European Union’s ecological and digital transition, and its defence, and to prevent its “slow death”. Despite their divided opinions, EU leaders drew up a roadmap for turning the EU’s economy around, calling on the European Commission to act quickly to: 1/ present, by June 2025, a new and comprehensive horizontal strategy on the deepening of the Single Market, including a roadmap with clear timelines and milestones; 2/ take decisive steps towards a Savings and Investments Union by 2026, and make urgent progress on the Capital Markets Union; 3/ present, as a priority, a comprehensive industrial strategy for competitive industries and quality jobs; 4/ implement, without delay, concrete proposals on reducing reporting requirements by at least 25% in the first half of 2025, and including red-tape and competitiveness impact assessments in its proposals. As far as social dialogue is concerned, in a period that looks set to be chaotic and marked by a succession of factory closure announcements, the Twenty-Seven are contenting themselves with maintaining a minimum service: the EU must “harness Europe’s talent and invest in skills to foster high-quality jobs throughout the Union”, with a view to tackling its labour and skill shortages. With these goals in mind, “we will aim to strengthen social dialogue, uphold equal opportunities and reduce inequalities, in line with the European Pillar of Social Rights”, say EU leaders. This modest ambition is aligned with the employers’ two main demands concerning social Europe: remedying the labour and skills shortages, and introducing “regulatory holidays”, or even watering down the directives passed by the previous Parliament (CSRD, due diligence, pay transparency, etc.) in the name of cutting regulatory burdens and bureaucracy, so as not to damage the competitiveness of European businesses.

Platform directive : On 11 November, one of the emblematic texts of the von der Leyen  Commission was published in the OJEU: Directive (EU) 2024/2831 of 23 October 2024 on improving working conditions in platform work (see IR Notes 226). The directive firstly establishes a presumption of employment for digital platform workers when “facts indicating control and direction are found” (Article 5.1). Secondly, it grants platform workers – whether self-employed or recognised as employees – a number of new “digital rights” with regard to algorithmic management (see Platform work). The text also invites Member States to take “adequate measures to promote the role of the social partners and encourage the exercise of the right to collective bargaining in platform work”.

Employers rise up against due diligence legislation : EU employers continue to be unhappy about the adoption of Directive (EU) 2024/1760 of 13 June 2024 on corporate sustainability due diligence (see IR Notes 226) (see Due diligence). Citing Mario Draghi’s report (see IR Notes 236), which asserts that “the EU’s sustainability reporting and due diligence framework is a major source of regulatory burden”, on 5 November, a group of 27 employers’ organisations and trade associations, including BusinessEurope and SME United, published a joint statement entitled “Towards EU due diligence rules that work for all”, setting out their concerns regarding the implementation and transposition phases of the directive. Their view is that the Commission’s goal of relieving and simplifying administrative burdens should prompt it to: 1/ Immediately launch a comprehensive competitiveness assessment of the directive, in consultation with businesses and their business associations, in order to identify and address priority areas for simplification, clarification and burden reduction; 2/ Either adopt guidelines and implementing legislation at least two years before compliance with legislation becomes mandatory, or extend the transition period; 3/ Harmonise and guarantee interoperability of the rules: these steps are essential for supporting Europe’s competitiveness and ensuring a well-functioning Single Market. The employers’ organisations are also calling on the Commission to closely monitor transposition measures, whilst coordinating with the Member States to ensure that divergence with the Directive is minimised. They warn that not following these recommendations “would once again jeopardise European competitiveness”. Ahead of the informal Council meeting in Budapest, the employers’ organisations also cited the application of the pay transparency directive as an example of an excessive reporting burden.

Restructuring : On 5 November, the European Commission unveiled a proposal to grant €700,000 from the European Globalisation Adjustment Fund (EGF) to finance measures designed to help the 632 employees laid off by Purmo (machinery) and Sappi (paper) to find a new job (see European Globalisation Adjustment Fund). The total cost of these accompanying measures, aimed at workers who are mostly lower-skilled and aged 50 years and older, is estimated at 1.2 million euros, 60% of which will be covered by the EGF (see press release). On 16 September this year, the Commission also announced support worth 2.7 million euros for 365 workers dismissed in Belgium by the retail chain Match-Smatch (see press release).

EU economic governance : On 22 October, European social partners, with the exception of BusinessEurope, adopted a declaration calling for their participation in economic governance and in the European Semester, under Regulation 2024/1263 of 29 April 2024 on the effective coordination of economic policies and on multilateral budgetary surveillance (see European Semester), to be strengthened. The signatories invite the European institutions to “take the necessary steps to ensure that meaningful and appropriate involvement of the European-level social partners is set in a European rulebook”. For example, in the Social Convergence Framework, European-level social partners and their national members in countries that are subject to a second-phase analysis, should be consulted “in useful time” to express their views on the existence of social imbalances and possible remedies.

Gas : The European trade-union federations IndustriAll Europe and EPSU have condemned the refusal by the employers’ organisation Eurogas to sign the draft European framework agreement for a just transition for the gas sector, which was validated by negotiators at the beginning of the year, and approved by the two federations’ executive bodies in March (EPSU) and April (IndustriAll) (see press releases issued by IndustriAll and EPSU). The text, which represents the outcome of a negotiation that began in July 2023 and seeks to result in a transposition via European directive, sets forth the minimum requirements for a just transition, such as adopting a “Social Just Transition Plan with the full involvement of workers’ representatives”. This just transition plan, which is linked to the decarbonisation plan, “shall map and clarify the employment and skills needs and the accompanying social measures aimed at promoting employment and quality jobs throughout the transition, including addressing strategic jobs and skills planning and related training policies”. However, Eurogas has refused to sign this text: its Secretary General, Andreas Guth, has invoked “difficulties in reaching consensus within an organisation of more than a hundred members”. EPSU’s spokesperson Can Kaya is unconvinced by this explanation. Following the recent breakdown of the cross-industry negotiation on telework and the right to disconnect (see IR Notes 219), he is concerned at the propensity of employers’ organisations to refuse to enter into binding agreements.

Paper : On 8 November, European social partners in the paper sector (180,000 employees in the EU) adopted a joint statement calling for “An EU Industrial Deal focused on ensuring quality jobs in the European Pulp and Paper sector”. The signatories call for a strong industrial policy that will allow a just transition, while at the same time developing “a re-skilling and upskilling agenda”.

Psychosocial risks : To coincide with the campaign launched by the EU’s Agency for Safety and Health at Work (EU-OSHA) to promote safe and healthy work in the digital age, the European Trade Union Confederation (ETUC) highlights that this objective cannot be achieved without strengthening EU law by adopting directives in the following three areas: 1/ telework and the right to disconnect (the ETUC is calling on the Commission to embark on the second-phase consultation for this directive); 2/ combatting stress at work, “which is the cause of over 40% of cases of depression in the EU and UK, and costs the European economy €620 billion a year”; 3/ AI at work, which will uphold the “human in control” principle (see press release).

No more impunity for anti-union practices : On 24 October, the Ministry of Employment put forward a draft law designed to strengthen collective bargaining and works councils (see press release). At the present time, “union busting” activities are only investigated if a complaint is made. One of the aims of the new law is to categorise as a criminal offence any offence linked to the use of intimidation tactics against works councils, by converting Article 119 of the BetrVG [German law on workforce representation] into an offence that will automatically be subject to legal action.

• Biological agents : A Royal Decree dated 6 October and published on 21 October, adapts the provisions of the Well-Being at Work Code with regard to biological agents, including those applicable when workers are unintentionally exposed to a biological agent (see press release).

Unions merge : On 5 November, by means of a unanimous vote giving birth to its “Industry” union, Luxembourg’s main trade-union confederation, the OGBL, merged two of its unions, which had previously represented the chemical and metalworking industries (see press release). The aim is to boost the trade-union presence in the industrial sector. Delegates adopted a five-year work programme that aims to “strengthen collective labour agreements, enhance working conditions and build on established rights”.

EWC and management bury the hatchet : After years of conflict, on 22 October, the management of Adecco Group and its European Works Council signed a new agreement covering the company’s EWC and social dialogue. The agreement, which states that the EWC adds value by “enabling better management decisions through making employee voices heard”, covers not only the company’s 46,000 or so permanent employees but also temporary workers who have an employment contract with a group entity. At geographical level, outside the European Economic Area, it covers the UK, Switzerland and now Serbia, too. The EWC, which has 36 members representing 24 countries, has a dual-voting system inspired by the Council of the EU: an opinion must be adopted by a majority of members, representing a majority of employees, so that every member carries their own “electoral” weight. In countries that have no employee representative, under the rules, EWC members are elected by all employees, via a secret ballot. A procedure is provided for in the event of any doubts surrounding the appointment process, whereby the representative’s mandate is suspended. To prevent the phenomenon of “phantom” members arising, the agreement stipulates that following two consecutive absences from EWC meetings without reasonable justification, a member’s mandate will be suspended and taken over by their elected substitute. The steering group will then ask employees from the country concerned to designate a new member. The role of EWC members is set out very precisely. The agreement includes definitions of information and consultation that are more elaborate and explicit than those contained in the directive, and it also grants the EWC the right to express an opinion concerning any transnational matter on which it has not been consulted under the agreement, but which its members have identified as being relevant and of transnational importance. The consultation procedure covering extraordinary matters is detailed, including a timetable, and states that management “cannot implement the decision(s) through irreversible measures until the steps” stipulated in the timetable “are completed”. A clause specifies various levels of confidentiality. If the agreement is terminated, the rule states that the EWC will remain in place until a new agreement is concluded.  A dispute resolution clause specifies several stages, including an amicable settlement phase, recourse to mediation and finally to arbitration under Irish law, with an arbitrator being chosen in advance to speed up the procedure. In terms of resources, the EWC is entitled to establish working parties and to commission experts, chosen by it but paid for by the employer, who may provide the following services if and when required: legal advice, financial expertise, industrial relations expertise or coaching.

Global agreement strengthened : On 4 November, the French banking group BNP Paribas (182,656 employees) and the Uni Global Union federation renewed the global framework agreement they signed in 2018. The new agreement incorporates the issue of working modes, defining common principles for teleworking practice based on fairness and sustainability, and ensuring that “a minimum presence [is maintained ] on the site in order to preserve the social link, collective effectiveness and collaborative work”. The text sets out rights and obligations linked to teleworking, including the right to disconnect. It is one of the first agreements to address the use of generative AI, with the intention of supporting employees in developing their skills and deploying generative artificial intelligence in a secure and ethical manner. The group specifies the activities concerned by AI and explains that it “has initiated an industrial approach in order to get the best out of it in terms of creating value”. Generative AI is “a new additional tool that assists in specific tasks”. Its scope of application “opens the way to significant transformations that the group will support”. Another section of the agreement deals with support for parenthood and work-life balance. It introduces paid paternity leave and child fostering leave, both lasting for a minimum of 6 days. Each employee can also benefit from a maximum of 5 unpaid “flexibility days” per year, to be taken either as full or half-days, so that they can manage absences linked to their personal life. The signatories have included the “We Care” health and well-being programme in the agreement. This was launched unilaterally by the group’s management in 2021, with the intention of providing all employees with death, incapacity-disability and health insurance cover, as well as taking action to provide support with mental health, e.g. rolling out a listening and psychological support system (with the goal of raising access to such services from 84% of employees today to 100%). They have also strengthened the provisions relating to workplace violence and harassment, and added support for victims of domestic and intra-family violence, “which is both a factor of inequality in the workplace and an obstacle to professional equality between men and women”. The agreement recognises UNI Global Union as a BNP Paribas partner within the framework of implementing its vigilance plan (see UNI Global Union and BNP Paribas press release).