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In previous issues of the European Review we have seen how the interventions of the European Court of Justice in a number of areas of labour law have had implications for the legislation of individual countries. Here we examine one of the most fundamental, the legal enforcement of collective agreements.
On 21 September 1999 the European Court of Justice gave its ruling on a case brought by a Dutch textile company. This seemingly minor affair concealed a decision which went to the core of the relationship between trade unions and their collective bargaining activities on the one hand and the legal framework of the state and European Community institutions on the other.
The textile company Albany was trying to exempt itself from a deal between the textile unions and employers in the Netherlands. This established a pension fund system for workers in the industry and had been made compulsory for all companies in that industry by the Dutch Minister of Social Affairs. What made their complaint interesting were the grounds: Albany used the competition rules in article 81 (1) of the EC Treaty as a basis for claiming that mandatory affiliation to the pension scheme compromised their competitiveness.
As we saw in issue 5, the ECJ usually gives an Opinion on a case before the formal judgement is handed down. On this occasion Advocate General Jacobs, who is British, chose to consider the whole question of the legality of collective agreements; what is more he did so on the U.K. basis of 'immunity' that is to say the extent to which trade union / employer agreements are exempt from anti-trust, pro-competition laws. This approach differs from that of most European countries which prescribe a positive 'right' of trade unions to make collective deals.
In order to do this he had to dismiss the International Labour Organisation (ILO)conventions, the Community Charter of Fundamental Social Rights, the Council of Europe's Social Charter and the European Convention on Human Rights all of which enshrine this right. Jacobs asserted that despite these conventions collective agreements in the EU were only 'contracts' and enjoyed immunity only so far as they dealt with 'core subjects of collective bargaining such as wages and working conditions'. This Opinion appeared to put at risk the gains made over many years by unions in all EU Member States as EU competition law would be deemed superior to their agreements with employers in many areas.
Happily for the trade union movement the official judgement in September did not go along with Advocate Jacobs. Whilst not mentioning his Opinion the Court clearly took a different line. Instead the judges emphasised the social policy objectives of the EU found in articles 2 and 3 of the EC treaty to which they gave at least as much weight as the competition provisions. Moreover they invoked the social chapter, a more recent piece of EU legislation incorporated into the Amsterdam treaty which explicitly supports social dialogue and collective bargaining.
This judgement has important implications for future labour law both in the EU generally and in the United Kingdom. Firstly it is not following the U.K. approach of 'immunities' but enshrines positive rights. Secondly these rights are supported by the Treaty of Amsterdam changes which were cited by the court as article 139 of the EC treaty: 'the dialogue between management and labour at Community level may lead.... to... agreements... implemented...[by]...Member States, or....by a Council decision on a proposal from the Commission'. Thirdly any attempt to restrict union rights in individual countries may be blocked by EU law's right to collective agreements.
This article is largely based on an item by Professor Brian Bercusson in Thompsons Labour and European Law Review
The ECJ recently dealt with a case arising in the U.K. which touched on the old chestnut of the transfer of undertakings (see Issue 6). This time EU law was explored as regards subsidiaries in the same group. Referred from a Leeds industrial tribunal, the case concerned AMS and ACC, both wholly owned subsidiaries of the AMCO mining group. ACC offered better terms than AMS but sub-contracted some work to its sister company. It also dismissed a group of workers who were immediately taken on by AMS only to be re-engaged by ACC on worse terms than before. The employees claimed that they should have the same terms. The Court decided that a transfer of undertakings had occurred and that therefore the trade unions should have been consulted.
Employers cannot use legislation which seeks to protect pregnant workers as a bar to employing them on a permanent basis. An operating theatre nurse, Ms. Mahlburg petitioned the ECJ because her employer had rejected her application to move from a fixed-term post to a permanent one on the grounds that she was pregnant. The employer claimed that German law forbade him from employing her in a job where she could be exposed to dangerous substances. The Court ruled that protective legislation cannot override equality laws guaranteeing access to employment.
However equality legislation does not prevent national laws decreeing that severance payments are less for those resigning to look after children. In Austria, where such payments seem to be more generous than in the U.K., a Mrs. Gruber was told that her claim that she was being discriminated against in receiving only half the amount payed to those resigning for other reasons was not valid. The Court maintained that her resignation was not related to working conditions and it was for these reasons that other resignations attracted higher payments.
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