Industrial actions and EU economic freedoms: The autonomous collective bargaining model curtailed by the European Court of Justice

Abstract

Is the right to take collective action as enshrined in a Member State?s national law restricted in any way by the rules on right of establishment under Article 43 EC or on freedom to provide services under Article 49 EC and the Posted Workers Directive? These were the main questions referred to the ECJ in the Viking and Laval cases decided by the Court in December 2007. In this article, the authors take stock of the EC rules brought to the fore in the cases. According to the judgments, the trade unions concerned are caught by the direct horizontal effect of the Treaty articles. Collective actions, with cross–border implications, may constitute a restriction on the economic freedoms under the Treaty. Such a restriction may, however, be justified under specific conditions. Even if the Court recognized the right to take collective actions as a fundamental right in Community law, the exercise of that right must be reconciled with the requirements of other rights protected under the Treaty. The judgments imply that the right to different kinds of collective actions depends on the aim of the action in question. In Laval, the secondary actions taken did not aim to directly regulate the employment conditions of the attacking union’s own members but rather at establishing a uniform level of wages and employment conditions applied by all undertakings in the branch, and the outcome was not confirmed in formal legislation, according to the Swedish social model. Since this demand went beyond protecting the “hard nucleus” of the Posted Workers Directive, the restriction caused by the collective actions was not justified.

The embedded flexibility of Nordic labor market models under pressure from EU‐induced dualization—The case of posted work in Denmark and Sweden

“…That is, we should observe (1) diminishing strength of organized labor, (2) a disembedding of flexibility, and (3) and an inability to produce compromises to solve the problems. While previous literature has clearly identified how EU case law on posting held the potential to hamper trade unions strength and disembedded the flexibility of the Nordic systems (Malmberg, 2008; Rønnmar, 2008), Blauberger (2011) argued that the Nordic countries could solve these problems through regulatory reforms based on national compromises.…”

“…The Swedish labor court asked the ECJ for guidance on interpreting EU law on this situation and the ECJ ruled that Bygnadds' collective action was illegal under EU law because it demanded a collective agreement, which was not generally applicable and went beyond the minimum standards prescribed by the PWD. Additionally, it argued that taking collective action to push local wages beyond the minimum wage prescribed in the sectoral collective agreement was an unjustified restriction to the free movement of services because it made the market intransparent for companies (Malmberg, 2008; Rønnmar, 2008). The ruling thus challenged both trade unions' involvement in local wage negotiations and their right to strike.…”

“…It is important to note that the conflict, which the case revolved around, was perfectly ordinary, according to the standards of the Swedish model. The Swedish labor court acknowledged this before asking the ECJ for guidance (Malmberg, 2008). The ruling, therefore, came as a shock for Swedish trade unions.…”

Free movement, Social Citizenship, and the Production of the EU’s legal territory as a “Social Milieu.” Reading the Laval case through Foucault

“…Laval did not sign the Swedish Construction Federation collective agreement with Byggnads This is particularly relevant since in the Scandinavian model the regulation of the labour market is determined by voluntary collective agreements 27 . The firm employed Latvian workers, whose hourly pay rate was significantly lower than the Swedish standard.…”