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We reported in previous issues on the industrial dispute in Sweden over the building of a school by Latvian labour. Now the competing claims of Swedish trade union and Latvian employer at the European Court of Justice have attracted comment from an EU commissioner. At stake are essential questions as to how cross-border contracts will be worked in the future Europe and the effect on local work conditions
When ten new, mostly Eastern European, countries were admitted to the EU in 2004 it was obvious that they were significantly poorer and had much lower wages and standards of living than the existing 15 Member States. The existence of a single market meant that it was a matter of time before employers sought to exploit this differential by employing workers from the poorer countries in the richer ones. This has caused problems in Ireland (see page 3) and in Sweden as two of the three countries currently allowing entry from the East. In the New Year the ECJ will consider the claim of Latvian construction firm Laval & Partneri that the Swedish building union broke EU law on posting of workers and non-discrimination by blockading its building site on the grounds that the Latvian workers were being paid less than normal Swedish rates.
Internal Market Commissioner Charlie McCreevy has waded into the row by stating that he would give evidence to the ECJ in favour of the Latvian firm and by criticising Swedish labour laws which allow the union's action. After ETUC General Secretary John Monks had called for 'adherence to the values of a social Europe, where economic and social development go hand in hand' and 'the levelling upwards of living and working conditions' and demanded an explanation of his comments there was some back-tracking by the Commissioner. But both the current case and the new Services Directive will help to determine if the levelling process will be to the advantage of workers in both 'old' and 'new' Europe.
Some employers in the UK reacted to the British government's implementation of the EU directive on paid holidays in 1998 by designating a slice of the normal weekly wage as 'leave compensation'. If the worker decided to book a week's holiday leave they would not receive any wages that week as holiday pay was deemed to be 'rolled-up' in their salary for the rest of the year. After several hearings before national courts three cases have now reached the ECJ. Messrs. Caulfield, Clarke and Robinson Steele all claimed that they could not take holidays because they would not paid at the time they wanted to take them. In a preliminary opinion the Advocate General decided that what mattered was the actual taking of leave. If the employer could ensure this then 'roll-ups' were legal as long as pay was increased when holiday pay was introduced and the amount notified to the employee.
Fixed-term contracts can't be based on age
A case from Germany highlights the fact that even well-meaning laws cannot be based on age discrimination. Werner Mangold was employed by Rudiger Helm on a fixed term contract of eight months. Herr Mangold contended that limiting the length of his contract restricted his employment rights. His employer replied that a German law intended to encourage older workers back into the labour market allowed anybody over the age of 52 to be employed on this basis. The ECJ ruled that, because the national law did not take into account whether the worker had been previously unemployed and allowed unlimited renewals of a fixed term contract, it was not compatible with the EU directive on Discrimination at Work.
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