20th Mar 2018

EU awaits two crucial labour rulings

  • Trade unions will be following the two case rulings closely (Photo: wikipedia)

The European Union is awaiting two rulings from its highest court which are set to have profound implications for labour relations in the 27-nation bloc.

The cases, to be decided Tuesday (11 December) and next week on 18 December, involve national employers seeking to use workers from another EU member state in order to reduce labour costs.

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Broadly they question whether internal market rules have a priority over other social concerns, such as labour rights and, as such, have become iconic cases for European trade unions.

Both cases also concern Nordic countries, famous for their generous employee conditions, fighting against cheaper labour from the east, a debate started after the 2004 EU enlargement taking on eight eastern member states.

The first case involves a Finnish ferry company that wanted to reflag its ship to operate under Estonia's flag, with a cheaper Estonian crew.

Finnish seamen protested the move with a strike, and eventually the Viking Line company brought the Finnish seamen's union to court saying it was interfering with the company's rights to free movement.

The European Court of Justice is now set to answer a series of questions including on whether the right to strike is overruled by the right to set up a business in another member state, with the freedom of establishment being a core tenet of the EU's internal market.

It will also look at whether a company, referring to the EU's internal market rules, may take an action against a trade union and whether striking which disrupts freedom of movement, another core internal market principle, may be justified.

Swedish case

Next Tuesday, the court will decide on a similar workers' rights case, involving a Swedish trade union and a Latvian company.

The Swedish trade unionists urged Laval - building a school in the Swedish city of Vaxholm - to pay higher Swedish wages to its workers.

Laval refused prompting picketing of its construction site by the trade unionists which it says forced it into bankruptcy.

The Latvian company argues the Swedes were being protectionist while the Swedes say the Latvians should have adhered to the country's collective wage agreements.

The court gave preliminary judgements on the cases earlier this year, which were partially welcomed by trade unions.

It said that the EU's freedom of movement principle cannot totally overrule the right to strike but that also the right to strike cannot ignore this internal market principle.

These preliminary judgements are usually but not always followed by the court in its final verdict.

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