IR Notes

On 22 June, five presidents of European institutions (*) presented their report “Completing Europe’s Economic and Monetary Union” (EMU), which proposes a three-phase plan to strengthen EMU between now and 2025 (see press release). There are several points to note concerning the social dimension of EMU: 1/ In social policy, the sole requirement relates to a “social protection floor” provided only “for the most vulnerable”. A restrictive view, limited to social welfare, that lends credence to the fact that social protection for “non-vulnerable” people could become entirely or partially their own responsibility. 2/ Despite a few goodwill gestures with regard to the European parliament and national parliaments, the strengthening of EMU is not subject to real democratic control – the question of an elected parliament for the eurozone, promoted by Germany’s former minister of foreign affairs, Joschka Fischer, and taken up by some German (Glienicker Gruppe) and French intellectuals (“Manifesto for a euro political union“), is not dealt with. 3/ With regard to employment, the document recommends continued reform of the labour market and the establishment of “a national body in charge of tracking performance and policies in the field of competitiveness”. These “independent entities”, whose activity will be coordinated by the European Commission, will be “democratically accountable”. They will have to “assess whether wages are evolving in line with productivity, and compare with developments in other euro area countries and in the main comparable trading partners”. Social partners should “use the opinions of the Authorities as guidance during wage setting negotiations”, a proposal that was curtly rejected by the European Trade Union Confederation (see press release).

• Protection against asbestos: After adopting an opinion entitled “Freeing the EU from asbestos“, in February 2015, the European Economic and Social Committee organised a conference on 24 June, supported by the European social partners for the construction industry (EFBWW and FIEC), to call for more effort to combat exposure to asbestos which, according to one expert who took part in the conference, (see press release), causes an estimated 47,000 deaths in the EU every year, in other words, 50 % more than the last estimates and twice as many as are caused by road accidents.


• Governance of the eurozone: The European parliament has adopted a report on its recommendations for eurozone governance. “Structural reform plans should require approval by national parliaments and involve social partners at all stages, in order to improve their effectiveness and strengthen the sense of national ownership”, say MEPs. (see press release).

• Central government bodies: The European social partners for the central government sector, TUNED and EPSU, have announced that they are negotiating a “legally binding text” on the information and consultation processes, particularly where restructuring is concerned (see press release from EPSU).

• Distinction between posting and hiring out: Should a Hungarian company that sends employees to Austria to cut up and package meat in the abattoir of an Austrian company, using part of its facilities, be considered to be posting workers as part of a provision of services or simply hiring out workers? In the first situation, the Hungarian company would merely have to make a declaration of posting, in the second, it would have to obtain a work permit for each employee. In a judgment (CJEU 18 June 2015, Case C‑586/13, Martin Meat) the Court of Justice referred to its judgment in the Vicoplus case. Three criteria characterise hiring-out: 1/ it is a service provided for remuneration in respect of which the worker who has been hired-out remains in the employ of the undertaking providing the service, no contract of employment being entered into with the user undertaking; 2/ the movement of the worker to the country where the work must be carried out constitutes the very purpose of the provision of services; 3/ The worker carries out his tasks under the control and direction of the user undertaking. In order to classify the contractual relationship “account must be taken of any evidence indicating that the movement of the worker in the host Member State constitutes or does not constitute the very purpose of the supply of services on which the contractual relationship is based”. The evidence accepted by the Court showed that this was not the case: firstly, the service provider bears the consequences of a provision of services that does not comply with the contract. Secondly, the service provider is free to determine the number of workers which it considers useful to send. In this particular case, the purpose is therefore not hiring-out, it is indeed a posting of workers, even if the undertaking that receives this service provision checks the performance of the service for compliance with the contract or gives general instructions to the workers posted.


• Working time of peripatetic workers: the advocate general of the Court of Justice of the European Union gave his opinion (the last stage before judgment) (CJEU 11 June 2015, case C‑266/14, Federación de Servicios Privados del sindicato Comisiones Obreras) in a case that will have significant consequences. The dispute relates to the classification of the travelling time of peripatetic workers (technicians responsible for installing security systems) when they go from their home to their first client and then, at the end of the day, from the last client to their home. The employer considered that it is not actual working time. The advocate general noted that their travel “is an integral part of being a peripatetic worker and therefore inherent in the performance of their activity”. Furthermore, during these journeys, the workers “are not outside the scope of their employer’s management power”. Lastly, he added that rest periods “serve to compensate for fatigue arising from periods of work” and that “it would undermine that essential function […]” if they were deemed to include these periods of travelling time. The Court, if it follows its advocate general, would therefore have to classify these periods of travelling time as working time and not as rest periods. In practice, the travelling time at issue will have to be taken into consideration in calculating the maximum length of the working day (11 hours of rest between two working days) and the working week (48 hours).

• Works council/Health and safety council elections: The law of 2 June 2015 specifies the procedure for the works council and health and safety council elections (“élections sociales”) from 9 to 22 May 2016 (see press release, in French).

• Short-time working: On 17 June, the Czech parliament approved the establishment of a system of short-time working inspired by the German “Kurzarbeit” system, which is incorporated into employment law. It is possible to resort to short-time working during periods of economic crisis, natural disaster, or political sanctions that have an impact on production by Czech companies (such as the measures taken by Russia in retaliation against European sanctions). Employers can use the system when they are unable to guarantee at least 20 % of the working time of their employees. When resorting to short-time working, employers undertake to maintain jobs. Workers receive 70 % of their salary, of which 50 % is paid by the employer and 20% by the state. The state can intervene for a period of up to six months, which can be renewed once.

• Restoring competitiveness: The new conservative government produced by a coalition ranging from the centre to the extreme right wants to impose an agreement on social partners to reduce the hourly cost of labour by 5%, by reducing pay or by reducing holidays or by increasing working time. If an agreement is not reached, the government has announced budget cuts amounting to 1.4 billion euros, with people’s social benefits being scrapped or reduced (see trade union press release).
  
  > Note also: The latest bulletin from the European Trade Union Institute on collective bargaining in the EU (Collective Bargaining developments May 2015).

Siemens: At its most recent meeting, on 27 and 28 May in Manchester, representatives of Siemens’ European employees voted in favour of several changes to their European works council agreement. As a result: 1/ the threshold for the allocation of a second seat has been lowered to 5000 employees; 2/ council members are granted a right of access to all sites in their country and can give information to the employees there; 3/ the obligations related to membership must be given preference over other employment obligations and members are obliged to attend meetings; 4/ the council strongly recommends the ability to speak English and/or German, in particular for internal communication (see press release from IG Metall).
In addition, a meeting has taken place in Beijing, with representatives of German employees, including the president of the European works council, and representatives of Chinese employees. The meeting was concerned with improving representation of employees at the Chinese sites, the provision of a workshop on collective bargaining (see summary by IG Metall), and the adoption of a constitution to establish a Siemens China Committee as a national representation of interest.

• ENGIE: At the European works council meeting on 25 June, the management of the energy group ENGIE (formerly GDF Suez) made unilateral undertakings regarding workers directly impacted by the group’s planned reorganisation. In addition, negotiations will begin on 8 July concerning a European framework agreement on a “social contract”, which is intended to establish a framework for giving workers long-term support throughout the group’s changes and transformations.

• Lafarge-Holcim: 60 representatives of workers at two cement manufacturers Lafarge and Holcim took part in a meeting on 16 and 17 June, to discuss the process for the merger between the two groups. Although both multinationals were invited to this meeting, Holcim did not send a representative, and was criticised for this by the international (BWI) and European (EFBWW) federations of building and woodworkers, and the European federation IndustriAll, in a press release.
  
  > Note also: The agreement of 3 June 2014 on the SE works council of Legris Industries (1300 employees), whose first meeting took place in Brussels on 30 June 2014. The German customer relations company Amevida (1800 employees) has converted to European Company status (Societas Europaea – SE), establishing a works council for the SE and employee participation in the supervisory board (see press release, in German).

Workplace health and safety: The European Agency for Safety and Health at Work has published the results of its second European survey of businesses, ESENER-2. This survey is based on responses from almost 50,000 companies questioned about matters related to managing health and safety at work and about occupational risks (see Summary). Special attention has been paid to psychosocial risks. Around 33 % of establishments with more than 20 workers state that they have an action plan to prevent work-related stress (see also comments from the European Trade Union Institute).

• Employment and labour costs: Eurostat has published some statistics on hourly labour costs which are rising again, except in Cyprus (– 1.8 %), and on employment, which increased slightly in the first quarter of 2015 by 0.1 % in the eurozone and by 0.3 % in the EU.


• Use of opt-out in relation to working time: The European Foundation for the Improvement of Living and Working Conditions (Eurofound) has published a study of the use by Member States of the possibility of opting out of the maximum working week of 48 hours.


• Labour market reforms: The European Trade Union Institute (ETUI) has published a Working paper (in English) that criticises the reforms of the Spanish labour market made since the beginning of the economic crisis. The relaxation of worker protection and the decentralisation of collective bargaining have had no impact on unemployment, which remains high, and have not mitigated the duality of the Spanish labour market, where the use of temporary contracts remains very significant. A study of the reform of the Italian labour market, conducted by the French analysis centre France Stratégie, highlights one of its features, which is to offer employers large incentives to employ workers on permanent contracts while restricting the opportunities for using temporary posts.