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TUAEUC digest 15/04/08

ECJ makes another ruling against trade union collective bargaining agreements

The European Court of Justice has struck down a law in the German state of Lower Saxony, which states that public contracts can only be awarded to companies which pay their employees the minimum wage as agreed in a regional collective agreement.

The law also encompasses sub-contractors. The case was brought before the ECJ because a Polish company had paid according to their national minimum wage, which amounted to 46.5% of the wage prescribed by Lower Saxony. The ECJ ruled that the law imposed restrictions on free movement.

The European Trade Union Confederation (ETUC) called the ruling "another destructive judgement" and, bizarrely, called on the EU to confirm that it "is not just an economic project."

PA reports that Unite general secretary Derek Simpson called the judgement "by far the most damaging" of a series of ECJ rulings seemingly undermining the unions.  He said, "This decision effectively means that foreign companies working here in the UK, or in any other European country, can flout domestic laws and collective agreements with regard to pay. This is a recipe for disaster and, if applied in the UK, will cause massive industrial unrest and threaten the delivery of major infrastructure projects including the Olympics site."

The case follows the recent ruling in the similar Laval case, which ruled against a Swedish union that tried to hold a Latvian construction company to a voluntary collective agreement. The court has also found against the Finnish seafarers' union for trying to prevent shipowners displacing Finnish shippers with lower paid Estonian crews. British Airways has also threatened their pilots with a similar court case if their union took strike action against the company employing lower paid staff to replace them.

RMT general secretary Bob Crow said that the whole point of trade unions was to maintain national labour standards and preventing social dumping.
“It seems that the whole point of the European Court of Justice is to prevent trade unions and government bodies, in this case, from defending minimum national standards in the name of ‘competition’,” he said.

Moreover, employers are already protected by the EU Treaty’s non-discrimination principles protecting the ‘free movement’ of good, capital, services and labour regardless of the consequences.

In effect, the ECJ is assisting employers to win competitive advantage by undercutting industry standards and trade union collective agreements in the member states in which they seek to operate.
This mechanism was called the ‘country of origin’ principle in the controversial EU services directive introduced in 2006.
Following huge trade union protests, all mention of the ‘country of origin’ principle was removed from the directive. However, the ECJ is re-introducing the concept through court judgments.

TUAEUC has long warned that the renamed EU Constitution would give huge powers to the European Court of Justice, which is designed to promote 'ever closer union' within the EU and complete the single market. This court views trade unions and collective bargaining agreements as a barrier to the 'free movement' of goods, services, capital and people (meaning labour).

This latest ECJ judgment reveals once more that this court, which is an EU institution, operates in the interests of the architects of the eurofederalist project, big business and the most powerful corporations in Europe. The EU has also revealed it no longer requires the support of the ETUC to implement its authoritarian, neo-liberal and anti-working class project enshrined within the Lisbon Treaty.

Although British MPs have ensured that there will be no referendum in the UK by refusing to stick to an election manifesto to hold such a vote, Irish trade unionists should understand that the renamed constitution is a threat to their pay and conditions at work when they vote on the issue on June 12.

Europa-Nytt Earth Times EUobserver