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Partial Harmonisation and European Social Policy: A Case Study on the Acquired Rights Directive
Published online by Cambridge University Press: 27 October 2017
Extract
The question of Community competence has been one of the most debated issues since the ruling in Tobacco Advertising I, in which the Court annulled, for the first time, a Community Directive for lack of competence. This judgment is significant in terms of assessing the constitutional role of the Court in the Community legal order.
The aim of this article is not to comment on the Tobacco Advertising judgment. Rather, it is to consider the question of competence from a different angle: that of partial harmonisation.
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- Research Article
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- Copyright © Centre for European Legal Studies, Faculty of Law, University of Cambridge 2003
References
1 Case C–376/98 Germany v Parliament and Council [2000] ECR I–8419.
2 Subsequently referred to as ‘the Directive’. Directive 77/187/EEC, OJ 1977 L 61/26.
3 Directive 98/50/EC, OJ 1998 L 201/58.
4 Directive 2001/23/EC, OJ 2001 L 82/16.
5 Hepple B. ‘Report for the Commission of the European Communities Directorate-General Employment, Industrial Relations and Social Affairs—Main shortcomings and proposals for revision of Council Directive 77/187/EEC’, December 1990.
6 Case 324/86 Daddy’s Dance Hall [1988] ECR 739.
7 For an account of the position under British law, see Bourn, C and Thorpe, P ‘Preservation, Variation and Harmonisation of Terms and Conditions’, in Bourn, C (ed), The Transfer of Undertakings in the Public Sector (Ashgate 1999), 161 Google Scholar.
8 The case of Katsikas was dealt with by the Court along with two other requests for preliminary references from Germany. The facts of Skreb and Schroll are very similar to those of Katsikas: Mr Skreb and Mr Schroll worked as dockers in the stevedoring department of a German company which was transferred to another German company. Both of them, along with other employees, objected to the transfer of their employment relationship to the second company. They were dismissed by the first company. They claimed that their dismissal was not justified on the ground that they had not been transferred and that there were sufficient employment possibilities within the business of the first company. The Arbeitsgericht of Hamburg referred a question relating to the interpretation of the Directive to the Court which raised the same issue as in Katsikas. Joined Cases C–132, 138 and 139/91 Katsikas, Skreb and Schroll [1992] ECR I–6577.
9 The wording of this Article confirms that the aim of the Directive is the transfer of existing rights rather than the definition of such rights; indeed, national laws determine the level of acquired rights.
10 Case 324/86 Daddy’s Dance Hall [1986] ECR 739, at para 14.
11 Joined Cases 144 and 145/87 Berg and Busschers [1988] ECR 2559. This was subsequently repeated in Case C–305/94 Rotsart de Hertaing [1996] ECR I–5927.
12 Daddy’s Dance Hall, above n 10, para 14 and 15. For an application of this principle in the United Kingdom, see the two cases of Wilson v St Helens Borough Council and Meade v Baxendale [1998] IRLR 706 (combined appeal to the House of Lords).
12 Katsikas, above n 8, para 28.
13 Katsikas, above n 8, para 28.
14 Katsikas, above n 8, paras 25–27.
15 Case 104/85 Danmols Inventar ECR [1985] ECR 2639. For a detailed analysis of this judgment, see part IV below.
16 Katsikas, above n 8 para 30.
17 Katsikas, above n 8, para 31.
18 In particular, it is the first of the principles on which the International Labour Organisation is based. See the Declaration of Philadelphia.
19 Address on Work and the Workman, Dublin, 1928, at page 8. Quoted in O’Higgins, P ‘“Labour is not a Commodity”—an Irish Contribution to International Labour Law’, 26 Industrial Law Journal (1997) 225, 226 Google Scholar.
20 To understand the influence of the concept in its primary sense, see the United Nations Universal Declaration of Human Rights, Art 23(3), the Council of Europe’s Social Charter (1961), Art 4, the European Union’s Code of Conduct for Companies with Subsidiaries, Branches, or Representatives in South Africa (1977), Art 3, the Community Charter of Fundamental Social Rights for Workers, Art 5.
21 O’Higgins, above n 19.
22 This amounts to a clear rejection of the free market ideology in labour relations. Compare with the reasoning adopted in Nokes v Doncaster (subsequently used to justify that there should be no employee protection on transfers), in which the House of Lords held that an employee could not be forced to work for an employer that he had not freely chosen, as this would be akin to slavery [1940] AC 1014.
23 Art 3(4)(a).
24 Case C–268/94 Henke [1996] ECR I–4989, Case C–343/98 Collino [2000] ECR I–6659 and Case C–175/99 Mayeur [2000] ECR I–7755. Garde, A ‘The Public Sector as a Good Employer: the Application of the Acquired Rights Directive to Public Authorities’ 4 (2001) CYELS 153 Google Scholar.
25 Katsikas, AG Van Gerven’s Opinion, at para 18 and 19.
26 Joined Cases C–172 and 173/94 Merckx and Neuhuys [1996] ECR I–1253.
27 Case C–399/96 Europièces [1998] ECR I–6965.
28 Katsikas, above n 8, para 35.
29 Katsikas, above n 8, para 36.
30 For the position under British law, see Regulation 5(4B) of the Transfer of Undertakings (Protection of Employment Regulations 1981. Regulation 5(4B) was inserted into the TUPE Regulations by s 33(4)(c) of the Trade Union Reform and Employment Rights Act (TURERA) 1993. For the position under French law, see for example the decision of the Cour de cassation in Soc 16 janv 1990, Bull Civ V, n 11, at p 17.
31 AG Van Gerven referred to several cases in his Opinion, at para 3, n 5: judgments of 21 July 1977, BAG AP, Para 613a of the BGB, para 8, of 17 November 1977, BAG AP, Para 613a of the BGB, para 21, of 15 February 1984, BAG AP, Para 613a of the BGB, para 37, and BAG AP, Para 613a of the BGB, para 55, of 30 October 1986.
32 Advocate General Van Gerven considered that the case law of the Bundesarbeitsgericht on the question of objection could be described as a more favourable provision within the meaning of Art 8 of the Directive. Katsikas, AG Van Gerven’s Opinion, above n 8 at para 20. Following the revision and codification of the Directive, ex-Art 7 has now become Art 8. This provision states that the Directive is a measure of minimum harmonisation and consequently that Member States have the right ‘to apply or introduce laws, regulations or administrative provisions which are more favourable to employees or to promote or permit collective agreements or agreements between social partners more favourable to employees’.
33 Valentin Ionescu, who clearly is in favour of a uniform Community treatment of the right of objection, has argued that the right would be truly effective only if it was supported with complementary measures. In particular, employees should have some time to think about whether they want to transfer or not (even after the transfer has taken place, so that they can effectively exercise their right of objection) and they should have the necessary information to make up their mind. Ionescu, V ‘Le droit d’opposition des salariés au transfert de leur contrat de travail: mythe ou réalité’, (2002) Droit Social 507.
34 Sylvaine Laulom noted that ‘it was perhaps because of the sensitivity of an issue which has a bearing on dismissals law that the ECJ refrained here from making any attempt to harmonise national provisions which, however, have major implications for the exercise of the right of objection’. Laulom, S ‘The European Court of Justice in the dialogue on transfers of undertaking: a fallible interlocutor?’, in Sciarra, S (ed), Labour Law in the Courts—National Judges and the European Court of Justice (Hart Publishing, 2001), 145 Google Scholar. The fact that Art 137(3) of the Treaty maintains the requirement of unanimity for questions of dismissals confirms that this area of the law is particularly sensitive, even within the already sensitive field of social policy. However, the fact that Art 137(3) requires a unanimous vote in the Council also shows that the competence of the Community in this field is not excluded.
35 If the main aim of the Directive is the protection of employees’ rights, there are some limits that have been taken into account not only by the Community legislature (see the Preamble of the Directive) but also by the Court. Its case law on the interpretation of the material scope of the Directive is particularly revealing in this respect. For an account of the recent case law on the meaning of the expression ‘the transfer of an undertaking’, see McMullen, J ‘Side-stepping Süzen ’ 28 (1999) Industrial Law Journal 360 Google Scholar; Darmaisain, S ‘Le concept de transfert d’entreprise’, (1999) Droit Social 343; Davies, P ‘Transfers—The UK will have to make up its own mind’, 30 (2001) Industrial Law Journal 231 CrossRefGoogle Scholar; Sciarra, S (ed), Labour Law in the Courts—National Judges and the European Court of Justice (Hart Publishing, 2001)Google Scholar; Garde, A ‘Recent Developments in the law relating to transfers of undertakings’ 39 (2002) Common Market Law Review 523 CrossRefGoogle Scholar.
36 See for example the evidence presented by Sir Patrick Neill to the House of Lords Select Committee on the European Communities, taken before the Sub-Committee on the 1996 Intergovernmental Conference (HL Paper 88, at 218). For a response, see Professor Dashwood’s evidence (HL Paper 88, at 253).
37 Hepple, B above at n 5, at 12.
38 Case 105/84 Danmols Inventar [1985] ECR 2639. In Wendelboe, the Court had already decided, following the Opinion of Advocate General Slynn that ‘the existence or otherwise of a contract of employment or employment relationship on the date of the transfer within the meaning of Art 3 (1) must be established on the basis of the rules of national law, subject however to observance of the mandatory provisions of the Directive’. Case 19/83 Wendelboe [1985] ECR 457, para 16.
39 Danmols Inventar, above n 38, at para 26.
40 Danmols Inventar, above n 38, at para 28.
41 See the Opinion of the Economic and Social Committee, OJ 1995 C 133/13, para 1.3.
42 For example, Clause 1 of the Framework Agreement on Part-time work states:
The purpose of this Framework Agreement is:
-
(a)
(a) to provide for the removal of discrimination against part-time workers and to improve the quality of part-time work;
-
(b)
(b) to facilitate the development of part-time work on a voluntary basis and to contribute to the flexible organisation of working time in a manner which takes into account the needs of employers and workers.
Framework Agreement implemented by Directive 97/81/EC, OJ 1997 L 14/9. Clause 1 of the Framework Agreement on Fixed-Term Work uses a very similar wording. It is implemented by Directive 1999/70/EC, OJ 1999 L 175/43.
43 Hepple, B Report of 1990, cited above at n 5, at 72.
44 Of which Professor Hepple was a member.
45 Hepple, B Report of 1990, n 5, at 72.
46 Art 39 only has very limited exceptions. See in particular the narrow scope of Art 39(4) as interpreted by the Court.
47 Hepple, B above n 5, at 75.
48 Case 53/81 Levin [1982] ECR 1035.
49 Danmols Inventar, above n 38 at, para 24 to 28.
50 The Court held that terms crucial to the material scope of the Directive such as ‘a legal transfer’ and ‘the transfer of an undertaking’ had a Community meaning. On the expression ‘a legal transfer’, see recently Case C–51/00 Temco, judgment of 24 January 2002. On the expression ‘the transfer of an undertaking’, see recently Case C–172/99 Oy Liikenne [2001] ECR I–745. For commentaries on these cases, see the articles cited above, at n 34.
51 Danmols Inventar, Opinion, at p 2644.
52 In fairness to AG Slynn, he also acknowledged that ‘it may be highly desirable that there should be a Community definition but none has been so far adopted for present purposes’ (Danmols Inventar, above n 38 Opinion, at 2644). He suggested if a Community definition was to be adopted, the question would be ‘whether the individual concerned has bound himself, or put him-self into an employment relationship where he can be required to carry out instructions pursuant to that contract or relationship. The question in each case is whether he is subject to control.’ (Danmols Inventar, above n 38 n Opinion, at 2643). Professor Hepple noted that this definition was ‘defective and far too narrow because the control test [was] difficult to apply in relation to many modern employment relationships where the manager [was] incapable of directing “how” the highly skilled or professional worker [carried] out his tasks’ (Report above n 5, 74).
53 Art L 120–3 of the Labour Code.
54 Supiot, A (ed), ‘Report for the Commission of the European Communities Directorate- General Employment, Industrial Relations and Social Affairs–Transformation of labour and future of labour law in Europe’, June 1999, at 7.
55 See Art 2(2) of the Insolvency Directive (Directive 80/987, OJ 1980 L 283/23), Art 1 of the Collective Redundancies Directive (Directive 98/59, OJ 1998 L 225/16), Art 2(1) of the Working Time Directive (Directive 93/104, OJ 1993 L 307/18, as subsequently amended by Directive 2000/32, OJ 2000 L 195/41), Art 2 of the Young Workers Directive (Directive 94/33/EC, OJ 1994 L 216/12), Art 2(d) of the Directive on the Establishment of a European Works Council (Directive 94/45/EC, OJ 1994 L 254/64), Clause 1(2) of the Framework Agreement implementing the Parental Leave Directive (Directive 96/34/EC, OJ 1996 L 145/9), Art 2 of the Directive on Employee Consultation (Directive 2002/14/EC, OJ 2000 L 80/29)… This list is not exhaustive. However, it should suffice to establish that reliance on the mechanism of partial harmonisation is a common occurrence in the field of social policy. Note that partial harmonisation is also used in other fields of Community action such as tax harmonisation and consumer protection. All these fields are to a large extent contentious, the role of the Community not being particularly well defined at legislative level. Hence the ensuing difficulties for the Court.
56 See C–376/98 Germany v Parliament and Council [2000] ECR I–8419 (Tobacco Advertising).
57 Art 5 (ex-Art 3B), second paragraph, of the Treaty.
58 Art 2 of Directive 94/33/EC, OJ 1994 L 216/12.
59 For example, the text of the Working Time Directive lists the different categories of workers that may fall outside its scope of application (Directive 93/104, OJ 1993 L 307/18, as subsequently amended by Directive 2000/32, OJ 2000 L 195/41).
60 See the discussion above concerning the consequences of the right to object to one’s transfer.
61 Case C–245/00 SENA v NOS, judgment of 6 February 2003, not yet reported.
62 Directive 92/100/EEC on rental right and lending right and on certain rights related to copy-right in the field of intellectual property, OJ 1992 L 346/61.
63 SENA, above n 61, at para 23 and 24.
64 SENA, above n 61, at para 34. In so doing, the Court accepted the contention of the Commission and of the governments which submitted observations that Directive 92/100 deliberately omitted to lay down a detailed and universally applicable method for calculating the level of such remuneration.
65 See for example Lyon-Caen, G ‘Subsidiarity’, in Davies, P, Lyon-Caen, G, Sciarra, S and Simitis, S (eds) European Community Labour Law: Principles and Perspectives. Liber Amicorum Lord Wedderburn of Charlton (Oxford, Clarendon Press, 1996), 49 Google Scholar.