IR Notes

The European Court of Justice has delivered a ruling (CJEU, 17 March 2015, case C-533/13, Auto-ja Kuljetusalan Työntekijäliitto AKT/Öljytuote ry, Shell Aviation Finland Oy) in a case concerning the application of directive 2008/104 on temporary work and in particular one of its provisions (Article 4) which provides as follows: 1. That prohibitions or restrictions on the use of temporary agency work shall be justified only on grounds of general interest (protection of temporary agency workers, health and safety at work or the need to ensure that the labour market functions properly and abuses are prevented). 2. It imposes an obligation on the Member States to review any restrictions or prohibitions on the use of temporary agency work at national level in order to verify whether they are justified on the grounds mentioned in paragraph 1 within four years of the directive becoming law. The issue at stake was to determine whether the restrictions maintained in national legislation or applicable collective agreements could be contested by professional bodies or companies before a national court if they did not appear to be justified by one of these reasons. The Advocate General of the court, who delivers his conclusions in order to enlighten the court before it delivers its judgement, in his opinion (not available in English) (see IR Notes 21) considered that Article 4 established a “substantive rule” which “prohibits the maintenance of restrictions on the use of temporary agency work when they are not justified, in particular taking the harmonisation of minimum working conditions into account”. This prompted satisfaction on the part of the employers’ organisation Eurociett, which believed that it would be possible for its members at national level to challenge the restrictions which appeared to them to be contrary to the general interest (see interview in IR Notes 21 and press release). The European Trade Union Confederation in turn expressed concern about such an interpretation, in the interests of protecting temporary agency workers (see press release). In the end, the Court did not follow the Advocate General’s opinion. It took the view that Article 4 is addressed only to the “competent authorities of the Member States, imposing on them the obligation to review their national legal framework” and that “such obligations cannot be performed by the national courts”. From a legal point of view, the court thus does not confer a direct effect on the provision of the directive providing for the obligation to review restrictions. In other words, no organisation or company can bring an action before a national court to request the lifting of a restriction which it judges to be at odds with the criteria defined in the directive. The ETUC welcomed this ruling, which therefore does not permit direct action against national provisions of this kind which are generally in place for worker protection (see press release) and which, according to the ETUC, “guaranteed the right of the social partners to regulate the use of temporary agency work in collective agreements”. The decision can only be disappointing for Eurociett, although the organisation welcomes the fact that the Court has enshrined the obligation – which Eurociett regards as permanent and not linked to the one-off exercise to be conducted within four years of the directive becoming law – on the Member States to examine restrictions and remove those which are not justified (see press release in English). Reading this ruling, only the European Commission could henceforth take action against a Member State through proceedings for failure to fulfil an obligation (see Phrase of the fortnight below), on the basis that it had maintained unjustified restrictions. But will it do so, given that it did not act following the report on the application of the directive which demonstrated that the vast majority of Member States had left their legislation unchanged?

• Tripartite Social Summit: EU leaders and the social partners met to discuss jobs, growth and investment priorities for Europe at the Tripartite Social Summit (such summits are held on the eve of the two European Councils of the year) (see Commission press release). In the wake of the high-level conference on 5 March (see IR Notes 27), those representing the European Commission reiterated their support for social dialogue and underlined the need to develop social dialogue at national level in order to involve the social partners more closely in the implementation of reforms. The employers’ organisation Businesseurope insisted on pursuing labour market reforms, arguing in favour of a “reform partnership” (see speech by Markus J. Beyrer, director general of BusinessEurope ), while the European Trade Union Confederation called for a pact for growth and quality jobs.


• Relaunch of social dialogue: The speeches delivered at the conference on the relaunch of European social dialogue on 5 March have been published in their entirety on the European Commission website, including the long discourse of Jean-Claude Juncker, from which several digressions have been removed, including his anecdote recounting the surprise of the King of Spain when Jean-Claude Juncker left an official visit to Madrid early to attend a conference on social dialogue.

• Demonstration calling for political strikes to be allowed: The Estonian Trade Union Confederation has organised various actions, including a demonstration outside the Parliament, and submitted a petition to the Parliament to request protection for the right to strike. Although Estonian employees benefit from the right to strike, the legislation excludes political strikes against the government’s or legislator’s policies, if for instance industrial relations laws are being amended.

• Quotas for women on company boards: On 6 March, the parliament definitively adopted a law that establishes a 30% quota for women on supervisory boards for more than 100 companies which are either listed or subject to parity co-determination law (Gesetzes für die gleichberechtigte Teilhabe von Frauen und Männern an Führungspositionen in der Privatwirtschaft und im öffentlichen Dienst). The obligation will become compulsory from 2016. In addition, 3,500 other companies having more than 500 employees will be required to define quantitative targets to increase the proportion of women on their management or supervisory boards between now and the end of 2015. They will then have to publish the target they have set. However, no sanction will apply to them should they fail to reach the defined target (see government press release, in German).

• New collective agreement in the Polish postal service: On 18 March, enterprise-level trade unions of Polish Post (Poczta Polska), including two representative organisations – NSZZ “Solidarność” and the Trade Union of Polish Postal Employees – signed a new collective agreement with the board. The new agreement replaces its predecessor, which was revoked by the employer in July 2014 due to a row between the parties over the employer’s proposal to introduce new, performance-based bonuses. Trade unions resisted the proposed changes, and by the end of 2014 the conflict had escalated into a collective dispute. After lengthy negotiations, the parties decided to sign a new collective agreement, but the collective dispute has not been resolved. NSZZ “Solidarność” informs that it will continue to apply pressure on the employer to increase the basic wage for all employees. Polish Post is the public postal operator with 78,000 employees (as of end 2014). However, this number is likely to decrease by 8,000 in 2015 due to a restructuring programme which is currently under way.)

• Towards a revision of the legislation on fixed-term work: The government has just come in for further criticism from the European Commission because of its excessive use of fixed-term employment contracts. In 2007, the centre-right government did indeed make it easier to use fixed-term contracts in order to get around provisions of the law on job security which guarantee workers the conversion of their employment relationship to a permanent contract after they have been employed for a certain period of time by the same company. In the opinion of several trade union organisations, this legislative change has increased the precariousness of a large number of employees. According to the Swedish trade union confederation (LO), 52% of employees aged under 25 are employed on fixed-term contracts. The new government, which took up office in September 2014 and was formed by the social democrats and the Green party, had not yet concerned itself with this matter. However, the employment minister has indicated that he is now going to examine the legislation to see what can be done to alleviate the problem.

• ArcelorMittal: At a meeting of the select committee on 5 March, the management of the steelmaking group called for a clause of the 2007 installation agreement to be invoked which provides for the composition of the EWC to be adapted when changes involve a “significant increase or decrease in the number of workers employed” in the EU. In fact, since 2007, the workforce has gone down by nearly 40% in the EU, from 132,000 to 80,735 workers at the end of 2014. The management therefore proposes to reduce the size of the select committee from 25 to 16 members, and of the EWC from 54 to 33 members. A meeting was held on this subject in Brussels, between the management, IndustriAll and the secretary of the EWC, Jean-Luc Ruffin, in order to highlight in particular the importance of ensuring the continued presence of all of the representative trade union organisations within the European works council. In a letter dated 17 March, Jean-Luc Ruffin proposed to members of the EWC to set up a working party on this matter. An extraordinary select committee meeting is convened on 25 March for an initial negotiation to address the management proposals. It is expected to adopt a declaration in support of maintaining trade union diversity.


• EDF: The management and a delegation of European works council members have commenced negotiations on modifying the article of the EWC installation agreement dealing with the EWC’s composition. In fact, as a result of recent acquisitions in France, the number of French representatives on the EWC has automatically gone up, to the detriment of the delegations from other European countries. A committee of nine negotiators – one per delegation of the countries represented (UK, Poland, Italy, Hungary, Belgium) and per representative French trade union (CFDT, CFE-CGC, CGT, FO) – should, as a CFDT press release indicates, “strike a delicate balance to continue high-quality work and to retain the body at a reasonable size and with a sufficient number of members per country, even for those with a smaller workforce”. Following the initial negotiating session on 12 March, a final meeting is scheduled for 14 April.

• Atos: The SE works council of the IT services group Atos SE on 4 March delivered an opinion in connection with the proposed purchase of Xerox’s IT Outsourcing activities (ITO). Concluding an information and consultation process launched on 2 February, the opinion underscores the strategic importance of the Xerox ITO acquisition. This transaction would permit an acquisition on the American market at a “relatively weak price”. The works council declares its support for the acquisition, while at the same time calling on the management to take into account a certain number of concerns, particularly as regards safeguarding employment in Europe and a mobility package. At the end of this reasoned opinion based on an expert report prepared by the French consultancy Sextant, the SE works council underlines that the growth by acquisition must not overshadow the need for the group to grow organically and that, while the purchase of Xerox ITO is clearly advantageous for the shareholders, this is less evident for the European employees.

• Inditex: The Spanish textile group Inditex (137,000 employees) on 18 March announced a profit-sharing plan for the years 2015 and 2016 which will benefit around 70,000 employees worldwide working at its different sites (stores, factories, logistics centres) and subsidiaries, as long as they have worked for the company for at least two years (see Inditex press release, in English). The group will award these beneficiaries 10% of the year-on-year growth in the net consolidated profit of the group up to a cap of 2% of total profit. While saluting this initiative, the UNI Global Union Commerce international trade union federation noted that too many short-term employees would not benefit from the scheme (see press release, in English).

Solvay: The management of the Belgium chemical group Solvay and the IndustriAll international trade union federation convened the first meeting of the Solvay Global Forum from 4 to 6 March. The Forum comprises nine trade union representatives of the group, four from the European Union (the members of the executive committee of the European works council from Belgium, France, Germany and Italy), and four trade unionists from Brazil, China, Korea and the United States (see IndustriAll press release). “Whereas we have high-quality social dialogue in Europe, we found that social dialogue did not match this level in other countries and that there was no reason for maintaining this distinction, given the group’s steadily increasing internationalisation,” explains Jean-Christophe Sciberras, head of industrial relations at the Solvay group. The social partners decided to set up a global body rather than expand the European works council with the addition of observers, “a solution which would have had two drawbacks,” comments Jean-Christophe Sciberras “On the one hand, it would have given the impression that industrial relations were being constructed on the basis of the European model and, on the other, it would have risked giving the impression of granting non-European countries only a minor role within the EWC because it would not be possible to invite as many representatives from these countries as there are EWC members.” What was chosen was a lightweight structure, with eight members (in the interim nine), “half from Europe and half from the rest of the world, to reflect the corresponding global balance of our workforce”. The aim is to encourage “interactivity and to promote genuine exchanges,” Jean-Christophe Sciberras underscores. “We were convened over a three-day period,” states Albert Kruft, secretary of the European works council, “and we met with members of the group executive committee, the managers of functional departments and the chairman of the Solvay executive committee, Jean-Pierre Clamadieu”. The Forum will meet once a year physically with the same format and once a year by video-conference. A discussion is under way to ensure a regular link between the members, initially in the form of a monthly information exchange, and subsequently to research labour-related topics, such as health and safety and profit-sharing. The Forum “provides considerable value-added for the EWC because it facilitates contacts with the rest of the world”.

• ThyssenKrupp: The management of the German ThyssenKrupp group (150,000 employees) on 16 March signed a global framework agreement with the IG Metall German trade union and the IndustriALL Global Union trade union federation (see press release). In a press release (in German) IG Metall stresses that the agreement contains an innovative clause relating to the resolution of legal disputes. In case of conflict, those who believe they have been exposed to a breach of the framework agreement have the opportunity not only to refer the matter to the representatives of the signatories at local level, but also to submit their grievance to a central email address for the attention of the agreement follow-up committee. The latter also has the right to undertake visits in order to conduct enquiries on site.

Study of non-standard employment in the aviation sector: Following the European conference on atypical employment in aviation, Ghent University, Belgium, has published the final version of the study which served as a resource for the conference. The study consists of two pillars: one concerns the legal aspects of the different forms of employment in the sector, as well as the question of the applicable labour and social security laws. The second comprises a survey of flight crews’ working conditions. The results are based on nearly 6,300 responses from European pilots, of whom 45% work for regular airlines, 22% for low-cost operators and 8% for regional companies. The highest respondent numbers come from pilots working for Ryanair (9.8%) Air France (9.5%), KLM (8.5%), SAS (7.9%) and Easyjet (4.1%). 79% of the pilots taking part in the survey have an employment contract with the airline for which they work (83% of these on permanent contracts); 5% describe themselves as self-employed, 4% are supplied by another company, and 5% by a temporary work agency. 85% of the employees are covered by the labour law of the country in which their home base is situated and 10% by the employment legislation of the airline’s country of registration.

• Slow-down in employment upturn: According to Eurostat, the number of people in employment increased by 0.1% in the euro area and by 0.2% in the EU in the fourth quarter of 2014 compared to the previous quarter (see Eurostat press release). In the third quarter of 2014, employment had risen by 0.2% in the euro area and by 0.3% in the EU.


• Employment Report: The Council on 9 March adopted the Joint Employment Report 2015, which takes stock of the employment situation in the EU, as well as labour market reforms which have been implemented and those still pending.


• Industrial relations in the EU: Every two years the European Commission publishes a report that takes stock of industrial relations in Europe. The latest report (in English), prepared for the conference on social dialogue held on 5 March (see 1. European union above), in particular contains one chapter on the development of industrial relations in those countries which have received financial assistance from international institutions and another on the changes affecting collective wage bargaining systems.

Proceedings for failure to fulfil an obligation are legal proceedings brought before the Court of Justice of the European Union. These proceedings may be brought by the Commission or by a Member State against a Member State which has not complied with European Union law. Proceedings for failure to fulfil an obligation are based on Articles 258 to 260 of the Treaty on the Functioning of the EU. Actions can be brought against a Member State which has adopted a text contrary to European law or refuses to repeal a national measure that is contrary to European law. They may also target delays in transposing a directive or a failure to notify national implementing measures to the Commission. Before proceedings are brought before the European Court of Justice, the Commission delivers a “reasoned opinion” to the Member State. If the Commission is not satisfied by the Member State’s response, it can then bring the matter before the Court of Justice. Once the Court has delivered its judgement, if the Member State fails to take the necessary measures, the Commission may bring proceedings for failure to fulfil an obligation for a second time; on this occasion, the Court of Justice may decide to impose a fine on the recalcitrant Member State.