EU court decides on Scandinavian trade unions
In two recent judgments, the European Court of Justice (ECJ), the judicial organ of the European Union, has given opinions on industrial actions of powerful labor unions in two Scandinavian countries.The disputes arose in the aftermath of EU's 2004 enlargement, where ten new member states, among them Estonia and Latvia, acceded the union.
With the free trade rights of the EU treaties - so called 'freedoms of movement' - allowing labor, capital and goods to move unimpeded between member states between which there are great differences in income, fears arose in the old member states regarding possible downward spiraling of their social systems. The figure of the 'Polish plumber' that destroys all job security became one of the symbols that helped rally opposition to the EU Constitution. Eventually this resulted in two 'No' votes in public referenda on ratification of the Constitution, resulting in it presently being considered a failure.
The Viking Line vs the Finnish Seamen´s Union (FSU) and the International Transport Workers´ Federation (ITF) case arose from a dispute where the unions threatened industrial action against Viking Line should the latter reflag the ship Rosella under Estonian flag and man it with an Estonian crew. Had the threats been those of governmental agencies, their illegality would have been obvious. Trade unions, however, are not governmental actors. Furthermore, they are given constitutional guarantees themselves governmental intervention so they vigorously argued that they not covered by European law.
According to the news portal EurActiv.com
...the Court found that the strike action threatened by the two unions amounted to a restriction of Viking Line's right of establishment. More generally, it went on to say, however, that such action may be legitimate if its aim is to protect workers' jobs or working conditions and if all other ways of resolving the conflict were exhausted.
Although the court's guidelines on balancing the conflicting rights of labor and freedoms of movement are vague and generic, both parties have announced satisfaction with the judgment. Since the decision was made in what is called the 'preliminary reference' procedure - where a court of the Member State asks the ECJ for clarification in interpreting specifically European legislation - it is the national court that has to apply said ruling to the particular circumstances.
A week later (the Viking Line judgment was publicized on December 11th), the ECJ gave another landmark opinion in preliminary reference proceedings on the Laval case. According to International Herald Tribune's summary,
[t]he case involved construction workers from the Latvian company, Laval, who were employed to renovate and expand a school in the Swedish town of Vaxholm. When the employers failed to agree on pay rates for workers brought from Latvia, union members picketed the site, and unionized electricians joined the action. The Laval subsidiary L&P Baltic Bygg, which managed the project, eventually failed and the workers returned to Latvia.
The court put it quite clearly that in situations where the "national context [is] characterised by a lack of provisions", foreign service providers may not be forced into negotiations of "unspecified duration. " (See EUObserver's summary) In Sweden, minimum wage is not set by statute, making it difficult to determine the rates of pay. Politicians and labor officials have generally expressed discontent with the judgment.