IR Notes

In France, the National Assembly on 29 November approved a draft law concerning the duty of vigilance applicable to parent and contracting companies (also see the text approved on 29 November), introduced with NGO support in the wake of the Rana Plaza disaster in 2013, in which more than one thousand workers in the garment industry in Bangladesh died. At the time it transpired that these employees were working on orders subcontracted by large, global textile or retail groups. The legislation has still to go before the second chamber of parliament, the Senate, (where it is likely again to be rejected) before being definitively adopted by the National Assembly at final reading. As the proposal explains, “The point is to make transnational companies accountable in order to prevent the occurrence of tragedies in France and abroad and to obtain compensation for the victims in case of harm to human rights or the environment”. The draft legislation provides for large companies with more than 5,000 employees in France (or 10,000 if they also have subsidiaries abroad) to be required to draw up and implement a vigilance plan intended to prevent serious harm to human rights and fundamental freedoms, human health and safety and the environment arising from their activities. However, this obligation would also be extended to companies they control, as well as the activities of their subcontractors or suppliers. A deterrent fine (of up to € 10 million) is envisaged should companies fail to meet this obligation. Furthermore, should an accident occur on the premises of a subcontractor, the multinational which placed the original order could be held responsible if the complainant proves that its loss is linked to the absence of a vigilance plan or its ineffectual implementation. A judge could then impose a maximum fine of € 30 million. This legislation, which now has a good chance of being adopted, was welcomed by the international trade union federation IndustriAll Global Union, which is very active in its pursuit of compensation for the victims of the Rana Plaza incident (see IndustriAll press release). By contrast, Medef, the principal French employers’ organisation, has published a press release denouncing a “Francocentric law” which “introduces obligations whose scope is far too broad and vague” (see press release). This initiative also echoes the text that was finalised by the negotiators of the Council, the Commission and the European Parliament to exclude “conflict” or “blood” minerals from the EU market. This regulation will ensure that, from 2021, the minerals and metals used in the EU, such as tantalum, tungsten, tin and gold – which are indispensable in the production of devices such as mobile phones – do not help to arm militias or fund human rights abuses in conflict zones. The Parliament has considerably strengthened the Commission’s proposal for a system of voluntary checks based on the creation of a responsible importer label (see press release of June 2016 and link to Parliament press conference).

• Proposed directive on business insolvency: The European Commission on 22 November presented a proposal for a directive on preventive restructuring frameworks, a second chance and measures to increase the efficiency of restructuring, insolvency and discharge procedures (in English) (see press release). The initiative was welcomed by the European Trade Union Confederation, albeit with a certain number of reservations (see press release). The proposal must now be adopted by the Council and the Parliament.

• European aid for retail sector employees made redundant in the Netherlands: In response to a request from the Netherlands, the European Commission on 29 November proposed the allocation of € 1.8 million from the European Globalisation Adjustment Fund to retrain 800 of the 1,096 employees made redundant by six companies in the retail sector (see press release).

Joint position on digitalisation in the chemical industry: The European social partners in the chemical industry on 22 November adopted a joint position on social and employment-related aspects of digitalisation. As a consequence of digitalisation, “a certain number of jobs will fall into obsolescence or face radical redesigning with the incorporation of new digital technologies”, while “others, newly created, will require specific and new skill sets”. The signatories insist on the need for a well-skilled workforce and on the involvement of the social partners at all levels, particularly in works councils and at company level, with a view to “mitigating digital transformation processes by raising awareness and exchanging best practices”.

• Definition of “worker” in the meaning of the directive on temporary agency work: The European Court of Justice has outlined the concept of “worker” in the meaning of directive 2008/104 on temporary agency work (CJEU, 17 November 2016, case C-216/15, Betriebsrat der Ruhrlandklinik). In the eyes of the Court, too narrow a definition of what constitutes a temporary agency worker would allow the member states or temporary work agencies “to exclude at their discretion certain categories of persons from the benefit of the protection intended” by the directive. The Court found that the concept of “worker” in the meaning of directive 2008/104 covers “any person who carries out work, that is to say, who, for a certain period of time, performs services for and under the direction of another person, in return for which he receives remuneration, and who is protected on that basis in the Member State concerned, irrespective of the legal characterisation of his employment relationship under national law, the nature of legal relationship between those two persons and the form of that relationship”.


• Non-payment of pension contributions and employer’s insolvency: The European Court of Justice has issued a ruling (CJEU, 24 November 2016, case C-454/15, Webb-Sämann) in a case concerning an employee whose bankrupt employer had for several months made deductions from his salary in respect of pension contributions but did not pay the amounts into the employee’s pension account. The effect of this omission was to reduce the employee’s pension by an amount between EUR 5 and EUR 7 per month. The question was whether these sums were protected by directive 2008/94 of 22 October 2008 concerning worker protection in the event of employer insolvency. In the eyes of the European Court of Justice, according to article 8 of the said directive, “money withheld from a former employee’s salary converted into pension contributions” is included in the salary elements (the “scope of the insolvency proceedings”) which must be guaranteed by the directive.

Increased accountability for employees involved in road traffic accidents: The Greek supreme court has issued two rulings that pave the way for employers to demand compensation from employees who have been involved in a road traffic accident if the latter have caused damages to their employer. As a case in point, a Greek truck driver lost control over his vehicle on a road in Italy, causing the vehicle and its load to be destroyed. He was found to be responsible for the accident, and the employer was entitled to demand compensation from him. In another case, a driver came off the road when driving in the mountains and died in a ravine. His family brought a legal action against the employer, believing that the accident was caused by fatigue as a result of the driver having to perform overtime hours without taking rest breaks. The court first seised for its part found that he was not wearing a seat-belt and that he bore 40% of the responsibility for the accident. However, the supreme court found that, when the accident happened, he had not worked during the previous four days, and on the day itself, he had only driven for a few hours. Consequently, he was found to be responsible for the accident. The employer was therefore entitled to demand the payment of damages and interest.

Unions resist forthcoming reform of compulsory education: The forthcoming major reform of compulsory education (the three-tier system to be replaced with a two-tier one, with middle school eradicated) has been awaited with great anxiety by public schoolteachers fearing substantial redundancies. At the beginning of a schoolyear, the details of the reform were still unknown. In autumn the Polish Teachers’ Union (ZNP) – the largest sectoral organization – took active stance against the approaching changes. In October ZNP held a series of rallies across the country in a gesture of protest to the reform and disagreement with the government’s indifference to any critical voices. According to the organisers, over 25,000 people took part in the rallies (see press release). In late November, a massive (estimates of the number of participants vary: from several to even 50,000, as the organisers claim) demonstration led by ZNP marched through Warsaw to the Parliament on the day of the first reading of the draft legislation (see press article).

• Minimum wage rise agreed: An agreement has been reached in the parliament to raise the minimum wage by 8%. This will bring the national minimum wage to approximately € 825 per month (12 monthly payments per year) for a full-time worker in 2017.

• Proposal to structure work on digital platforms: The Swedish trade union federation Unionen has put forward the idea of creating a new agency to regulate digital platforms such as Uber, Airbnb, Foodora and TaskRunner. The proposal will be included in the national collective bargaining round for 2017. According to Unionen, platforms such as Uber and Airbnb would be required to apply for certification from the new agency. The main objectives are to develop a common framework for the payment of taxes and social security contributions, for social rating systems and for improved personal data management, some of the main areas which Unionen currently regards as problematic.

• Schreiber Foods: The American dairy group (7,000 employees, including 1,452 in the EU) on 23 November this year concluded an agreement on the establishment of a European works council (in Spanish). The group employs people in Germany, Bulgaria, Spain (734 employees), Portugal, the Czech Republic and Slovakia. According to Enrico Somaglia, company policy officer at the European trade union federation EFFAT, the provisions of the agreement “go far beyond the standards of the EWC directive” (see EFFAT press release).
  > Also see the agreement signed at the Erwin Hymer Group (in German).

Orange: The management of the telecommunications group Orange (154,000 employees, including 96,000 in France) on 27 September signed an agreement on measures to accompany the company’s digital transformation. This is the first agreement at one of the 40 companies listed on the Paris Stock Exchange to be entirely dedicated to the digital transformation issue. Part of the agreement in particular aims to ensure respect for the work-life balance by guaranteeing a right to switch off. Orange “strongly recommends to employees that they do not use their electronic mail or other communication tools during daily and weekly rest periods or when on leave in order to guarantee that these periods are respected”. To achieve this, the agreement says that management has a duty to set an example in the way it uses digital tools and “must ensure that this right is respected”.

• Volkswagen: The future of the group and its global workforce has been sealed by an agreement concluded between the management of the German car manufacturer, the IG Metall trade union and representatives of the Volkswagen world works council. Under the agreement, entitled “Pact for the future”, Volkswagen plans to cut 30,000 jobs, including 23,000 in Germany, by 2025 without compulsory redundancies and by making use of early retirement schemes (see press releases of IndustriAll, and IG Metall). Elsewhere, as part of a training programme initiated by the world works council, works council representatives from Brazil, Spain and Portugal visited the company’s location in Wolfsburg (Germany) and held discussions with representatives of IG Metall on the subject of trade union cooperation (see IG Metall press release).

• Saint-Gobain: On 23-24 November, IndustriAll Global Union organised the second meeting of the global trade union network of the Saint-Gobain group (170,000 employees) in Paris. Discussions focused in particular on precarious work and health and safety. The participants adopted a work programme for the coming twelve months (see IndustriAll press release).


• BAE Systems: The global trade union network established in 2014 at BAE Systems (82,500 employees), a British group active in the defence and aerospace sectors, met on 9-10 November to adopt a new action plan (see IndustriAll press release).

Collective bargaining in support of new rights for LGBT workers in Italy: The FDV (Fondazione Di Vittorio) in collaboration with the Italian General Confederation of Labour (CGIL) and its federation for commerce and the services sector FILCAMS, has published a study (in English or Italian) on the role of collective bargaining in improving the rights of LGBT workers. The study is based on an analysis of the most recent collective agreements essentially negotiated at company level and containing specific measures in support of employees belonging to these categories. A summary in table form highlights the main clauses.