sou · GWB3123 · 2008-12-15 00:00:00 — The interpretation of the Court of the Posting of Workers Directive may be said to mean that the Directive not only consti- tutes a floor for the level of worker protection for posted wor- kers, but also a ceiling for what may be demanded in relation to the posting employer. The possibility of requiring, ultimately through industrial action, the application of a collective agreement in its entirety and demanding conditions that lie at an average or normal level according to the agreement is therefore more restric- ted than what has sometimes been assumed to be the case by the unions prior to the judgment being issued. Another consequence of the judgment is that can no longer be applied as regards posting of workers to Swe- den from another EEA country. In practice, this means that the legal situation in these situations to that which applied before was introduced. This means that it is no longer possible to ignore a collective agreement that a posting employer from another EEA country applies for the posted wor- kers. As regards the consequences of the position adopted by the Court, and similarly measures to rectify the problems for the Swedish labour market that the judgment entails, the answers of Court of to both of the questions referred are to a large extent interrelated. This is reflected in our proposals. The uniform solution we put forward is aimed at both setting bounda- ries for which requirements may be imposed with the support of industrial action in the situations now in question, and at regulating how terms and conditions of employment already applied by employers for posted workers are to be dealt with. Choice of method to extend the application of conditions of collective agreements According to our Committee Terms of Reference, we were assig- ned to examine the possibilities of extending the application of the conditions of collective agreements so that they also cover workers who have been posted to . We have assumed that there are four different alternatives with regard to the choice of method for extending such terms and con- ditions of employment. These alternatives are: statutory rules for minimum rates of pay; a system for declaring collective agreements to be universally applicable; a model within the framework for Article 3 (8), second paragraph of the Posting of Workers Direc- tive; and also what is now referred to following the judgment as a fourth model, which does not follow any of the methods referred to in the Posting of Workers Directive for extending terms and conditions of employment in relation to posted workers. As regards minimum rates of pay by law and declaring collective agreements to be universally applicable, which are both methods referred to in the Posting of Workers Directive, we have interpre- ted our Committee Terms of Reference to mean that these solu- tions should be avoided if it is possible according to Community law to implement a less extensive solution as regards the autonomy of the parties in the labour market. An introduction of statutory rules on minimum rates of pay would mean that the responsibility for the determination of the level of minimum rates of pay is transposed from the social part- ners to the government. Here, it ultimately becomes a political decision that determines the level of the minimum rate of pay instead of this level being established, as today, through negotia- tions between the employers and employee organizations. The above also largely applies as regards declaring collective agreements to be universally applicable. Such a system would mean that a particular agreement within a sector would, through a politi- cal decision, be selected to apply to all of the countrys workers within the sector. The conditions of a collective agreement that has been declared universally applicable would virtually achieve the status of a statute and its application, for both national workers and workers posted to , would no longer solely comply with contractual grounds and principles. An introduction of any of these systems, that is to say statutory minimum rates of pay or declaring collective agreements to be uni- versally applicable, would consequently entail a major intrusion into the Swedish labour market model. However, this does not mean that the system does not have its benefits. Provided it were designed in the right way, it would be possible to achieve predicta- bility for a foreign employer as regards applicable conditions, which is difficult to achieve through other methods. Moreover, this would also mean that Swedish and foreign employers would conse- quently be treated exactly the same in this respect. However, we have found other models for the extension of col- lective agreement conditions, which are less intrusive to the func- tion of the labour market and which we consider to be acceptable from the Community law perspective. We have therefore chosen not to proceed further with any proposals regarding the introduc- tion by statute of minimum rates of pay or a system for declaring collective agreements to be universally applicable. For countries that do not have any system for declaring collec- tive agreements to be universally applicable, Article 3 (8), second paragraph offers two alternative methods by which the Member States, if they so decide, can base themselves on a collective agree- ment provided the agreement has certain attributes. The collective agreement should either be generally applicable to all similar undertakings in the geographical area and in the pro- fession or industry concerned (the first indent), or have been con- cluded by the most representative employers and labour organisa- tions at national level and applied throughout national territory (second indent). The first indent is said to have been adopted to protect Swedish and Danish interests and consequently directed at the labour market models of these countries. We have, in the course of the reasoning expounded in detail in our report, discussed extensively the meaning of Article 3 (8) second paragraph, primarily regarding the question of how, accor- ding to the Article, it would be possible to base itself on a collec- tive agreement and what is meant by the first indents requirements for a collective agreement to be said to be generally applicable. We have concluded that the Swedish collective agreement model can be classified as belonging to a system that falls within the first indent of the provision. This can be done through it being stated in an act, as a precondition for a trade union being allowed to take industrial action against an employer from another EEA country, that the collective agreement sought with the posting undertaking has cer- tain attributes that correspond to those referred to in the indent in question. One advantage with fitting in the Swedish model (with the right to industrial action) in this way under the framework for the Pos- ting of Workers Directive is that, in accordance with the reasoning expounded in detail in our report, it would also be possible to require collective agreement conditions in relation to posted wor- kers for areas covered by the list contained in Section 5 of the Pos- ting of Workers Act, that is to say work periods, holidays, etc. The fourth model, discussed as a result of the judgment of Court of , was primarily based on the statement by the Court that methods for the extension of national conditions besides those specifically mentioned in the Posting of Workers Directive may also be used, provided such methods upon a consi- deration based on Article 49 of the do not breach the principle of freedom to provide services. Such a fourth method basically corresponds to how has actually implemented the Directive, that is to say that it has been left entirely to the social partners to regulate the conditions of collective agreements for posted workers without having made any special regulation regar- ding this in the Posting of Workers Act. The Court concluded that such a method, which is not contai- ned in the Posting of Workers Directive, cannot be used to estab- lish the application of collective agreement conditions in areas governed by the Swedish legislation. However, the method can be used in areas where there is no such regulation as in the case of minimum rates of pay. However, the relevant collective agreement was considered to be cumbersome and unpredictable as regards which minimum level would apply under the agreement. In our opinion, a fourth model could form the point of depar- ture for regulation of the terms and conditions of employment for posted workers. However, the disadvantage in relation to a solu- tion according to one of the methods specified in the Posting of Workers Directive is that it would not be possible to extend conditions under a collective agreement to areas also governed by the Swedish provisions referred to in the Posting of Workers Act. This method would consequently only be of relevance regarding minimum rates of pay and not as regards work periods, holidays, etc. Our conclusion in this respect is that can and should choose a method for extension of collective agreements in relation to posted workers that falls within the framework of Article 3 (8), second paragraph of the Posting of Workers Directive. The method that we propose still allows collective agreements and the social partners to be given an role through the conditions under collective agreements also being of relevance to areas where the conditions are governed by law. This solution is consequently the one that lies most in line with our Committee Terms of Refe- rence. The question of which conditions it may be allowed to demand with the support of industrial action According to our interpretation of the judgment, it is not allowed, according to Community law, to have a system that per- mits industrial action against an employer from another with the aim of forcing through demands for collective agreements containing conditions that, without being subject to public policy according to Article 3 (10) of the Posting of Workers Directive, lie outside the hard core of the Posting of Workers Directive. As regards conditions that lie within this hard core, it is only minimum conditions that may be forced through in relation to an employer from another EEA country. This of course applies regardless of whether the conditions are regulated by law or through collective agreement. According to the judgment of Court of in the case, industrial action aimed at forcing through conditions at levels higher than the minimum level violates Article 49 of the Treaty regarding the right to per- form services. It follows from Court of judgment not only that collective agreement conditions that are to be forced through in relation to employers from other EEA countries should refer to the minimum level according the agreement – the condi- tions must also be plain and clear. The posting employer must be able to discern in a reasonable and simple way from the agreement the obligations that follow from the collective agreement within the hard core. Industrial action in support of demands under col- lective agreements should consequently only be allowed if the con- ditions of the collective agreement are plainly and clearly stated and thereby predictable for an employer that posts workers to . Considering the judgment of Court of in the case, as currently formulated cannot be applied as regards posting within the EEA. However, some form of mechanism to be able to force through terms and conditions of employment in relation to employers from other Member States is needed if we are to continue to leave the regulation of terms and conditions of employment to the social partners in these situations. However, such mechanism must not violate Article 49 of the on the freedom to provide services. may it operate in the same way as does today, that is to say in the way that Court of found to be directly discrimi- natory against employers from other Member States. A model that regulates the right to take industrial action against an employer from another EEA country would as such allow the setting aside of conditions and agreements that the employer already applies in relation to its posted workers. On the basis of the model we have discussed so far, one precondition for the right to take such industrial action is that only plain and clear minimum conditions within the hard core, according to collective agree- ments that satisfy certain requirements, are demanded in relation to the employer. However, in our assessment this is not sufficient to guarantee that industrial action is not taken in some circumstances where this is not allowed according to Community law. According to case law of Court of regarding Article 49 of the on the freedom to provide services and the statements of the Court referring to in the case, considera- tion must also be given to the conditions that the posted workers already have, for instance under a collective agreement in the home country or according to an agreement with the employer. Indus- trial action which restricts the freedom to provide services may only be taken if it is necessary to achieve the aim for which it is used. This implicitly requires, among other things, that the posted worker may be afforded a real advantage, that is to say basically better conditions than he or she already has. According to the principle of mutual recognition, a is also liable to respect the conditions and requirements a provider of services already applies in relation to its workers under the rules in its home country. If the service provider already applies the same or better conditions than those in the host country, we consider that no action restricting the freedom to perform services can be taken without this resulting in a breach of Article 49 of the Treaty. The position we have adopted and our deliberations in this respect lead to two conclusions. First, it ought not to be possible to force through demands for a collective agreement in with the support of industrial action if the conditions of the collective agreement lie at the same level or a level lower than the levels according to the legislation that is referred to in Section 5 of the Posting of Workers Act. Second, it should not be possible to take industrial action aimed at signing collective agreements if the posting employer has essen- tially at least such conditions as the employee organization demands. In such cases it can therefore not be deemed necessary and proportional to take industrial action and impede the perfor- mance of services in order to regulate the terms and conditions of employment for the posted worker. In the course of our inquiry it has been asserted by the unions that it must at least be possible to require an employer from another EEA country, who claims that it applies particular condi- tions for its posted workers, to confirm these conditions by concluding a collective agreement with the relevant employee organization. The organization would thereby be given an oppor- tunity to exercise supervision for true compliance with the condi- tions. Such a general right to always be able to demand a collective agreement is, however, in our opinion not compatible with Com- munity law. We are aware that the collective agreement is an important instrument for the trade unions as regards supervision and verifi- cation of the terms and conditions supplied by the employer. An effective instrument for a monitoring and verification function that would be compatible with Community law can, however, be achie- ved in another way through the rules we describe in the following. A conditional right to take industrial action against employers from other EEA countries As indicated by the basic position we have adopted, we are of the opinion that it is possible to find a solution to the problems that arose through the judgment within the framework of the Swedish labour market model. However, one precondition for this is that the model is modi- fied in posting situations so that it is in compliance with Article 49 regarding the freedom to provide services according to the , and does not otherwise have a discriminatory effect in rela- tion to undertakings from other countries within the EEA. against this background, we propose that a special rule be introduced regarding the right to take industrial action against an employer from another EEA country. This rule, which we propose be introduced into the Posting of Workers Act, contains three components. All components must be satisfied for it to be allowed to take industrial action for the pur- pose of regulating conditions for posted workers through a collec- tive agreement. The first component of the provision aims to qualify the Swedish collective agreement model so that it falls within the scope of Article 3 (8), second paragraph, first indent of the Posting of Wor- kers Directive. It follows from this component that the terms and conditions of employment must, in order to be forced through with the support of industrial action, correspond to the conditions contained in a collective agreement concluded by an employee organization and an employers organization at central level and applied generally throughout regarding corresponding workers in the sector in question. What is meant by such an agreement is a nationwide sector agreement that regulates terms and conditions of employment for the category of workers to which the workers posted to belong. Such a sector agreement in the Swedish labour market can, in our opinion, be said to be applied generally by Swedish employ- ers in the sense referred to in the Posting of Workers Directive. The second component of the provision regulates the kinds of conditions and what relative level of such conditions may be demanded with the support of industrial action against an employ- er from another EEA country. As regards kinds of conditions, these should relate to pay and/or such conditions covered by the list in Section 5 of the Pos- ting of Workers Act. They should consequently be conditions fal- ling within the hard core of the Posting of Workers Directive. For conditions also regulated by such legislation as referred to in the Posting of Workers Act, the level of protection in the col- lective agreement should lie at a level higher than according to the Act. For instance, the number of paid holidays demanded with the support of industrial action must be more favourable than the rules of the Annual Leave Act. Similarly, that demanded regarding work periods and rest periods must involve a situation better for the worker than according to the provisions of the Act. As regards the level of conditions according to the collective agreement, these must involve minimum conditions. Only the minimum level as regards rates of pay or other conditions that fol- low from the central sector agreement may consequently be demanded with the support of industrial action. According to the Posting of Workers Directive, it is up to the different Member States to decide what is meant by minimum rates of pay. In it should therefore not only be the basic pay that can be regarded as comprising a minimum rate of pay. It ought to be possible for this term to include other remuneration that is usually provided, for instance overtime rates, supplements for inconvenient working hours and night work and also shift work supplements. Moreover, the basic pay may be differentiated on the basis of the workers work tasks, their experience and competence and the responsibility the work involves. On the basis of these principles it may be left to the trade unions, in consultation with the relevant employers organizations or on their own initiative, to determine in detail what is to be deemed to constitute such minimum rates of pay and other mini- mum conditions within the hard core that are to be applied for a particular category of posted workers according to the central and nationwide collective agreement applicable to the sector. Here the trade unions could conceivably make use of some form of ancillary agreement, with references to relevant provisions in the sector agreement, or use a specially worded standard agreement that in these areas reflects the provisions applicable under the sector agreement. Under the heading The Swedish Work Environment Authoritys role as liaison office, we present a further proposal aimed at ensuring that agreements of this kind are submitted to the Swedish Work Environment Authority. With this solution it can be said that a nationwide sector agreement forms a kind of reference agreement as regards which conditions and requirements may be imposed with the support of industrial action in relation to employers from other EEA coun- tries. It is therefore only possible to force through conditions that, as regards minimum levels, correspond to those applicable under the sector agreement. The third component of the provision means that an industrial action may not be taken without regard being taken to the condi- tions the posted worker already enjoys according to, for example a collective agreement or a separate contract of employment in their Here an obligation is placed on the posting employ- er to show that the conditions applied in relation to the posted workers already lie at the same level as the conditions demanded or as conditions under another applicable sector agreement. The employer can be obliged to present documentation in the form of information on rates of pay, collective agreements or indi- vidual contracts of employment to satisfy the evidential require- ment. This evidential requirement can be imposed on the employer throughout the duration of the posting. The aim is that the trade unions would receive a tool to verify and monitor that these terms and conditions of employment cor- respond with the provisions of the Posting of Workers Act and with such provisions in a sector agreement that lies in the frame- work of the hard core. At the same time, the requirements imposed by Community law for regard to be taken to the condi- tions that the posted worker already enjoys according to some regulation in their home country are satisfied. Conditions outside the hard core of the Posting of Workers Directive (public policy) Article 3 (10) of the Posting of Workers Directive affords the Member States an opportunity of requiring posting undertakings from other Member States to comply with provisions on terms and conditions of employment outside the hard core of the Directive if the provisions relate to public policy. According to the case law of Court of , the term public policy means provisions that are so critical for the protection of political, social or economic order in a that it is necessary that they apply for all people and for all legal relationships within the . Based on Article 3 (10), foreign, posting undertakings are cur- rently obligated to comply with the provisions of the Employment (Co-Determination in the Workplace) Act on the right of associa- tion and right of negotiation. In the Terms of Reference, we were urged to examine whether Article 3 (10) should also be employed to facilitate the application of further conditions of employment outside the hard core of the Directive. We have not found any provision regarding the terms and con- ditions of employment in the Swedish legislation that can be deemed to fall in under the above-mentioned definition of the term public policy. We therefore do not propose any such amendment to the Posting of Workers Act. Does the Swedish Posting of Workers Act refer to conditions that lie outside hard core of the Directive? The Posting of Workers Act states the provisions in Swedish law with which foreign, posting employers must comply.