The Treaty on the Functioning of the European Union - Essay Example

Assessment of the proposition that in its interpretation of Article 45 TFEU [ex Art 39 EC], the European Court of Justice has moved from a test based on discrimination to one based on access to the labour market. Article 45 of the Treaty on the Functioning of the European Union or TFEU (ex Article 39 EC) basically provides for the following: “1. Freedom of movement for workers shall be secured within the Union. 2. Such freedom of movement shall entail the abolition of any discrimination based on nationality between workers of the Member States as regards employment, remuneration and other conditions of work and employment. 3. Sets out the rights and limitations to the fundamental right on grounds of public policy, public security or public health 4. Exemption from employment in the public service.” Although generally, the said article prohibits restrictions on the basis of nationality, there have been interpretations by European Court of Justice, which were criticised to have been counter to the objectives of the TFEU. One author said that there may be reverse discrimination especially for persons who work “in their own Member State and are unable to demonstrate a link with EC law,” as there may be instances where the “national legal regime governing their situation may be less generous than the rules (if any) applicable in situations governed by EC law” (Tryfonidou 41). Such person therefore may not be able to rely on Article 39 EC (Article 45 TFEU) “being a national of a Member State,” especially when the situation is considered as “purely internal,” and may apply only if “he or she has moved to another Member state in order to work” ( Tryfonidou 41). Citing the case of Iorio v. Azienda Autonoma Delle Ferrovie Dello Stato, Case No. 298/84 [1986] ECR 247, the European Court of Justices ruling held that there was no violation of Article 39 EC when, Mr Iorio, an italian lawyer who resided and worked in Italy, who found difficulty in moving freely within the said territory because of regulations which allowed access only to certain trains that operated within the Italian territory, in particular, those persons who had first class tickets (Iorio v. Azienda Autonoma Delle Ferrovie Dello Stato). The court explained that there was “no factor connecting it to the provisions of Community law concerning the freedom of movement for workers and thus article 39 EC (article 45 TFEU) was not applicable” ( Iorio v. Azienda Autonoma Delle Ferrovie Dello Stato). The court stressed that “an Italian national who was a worker in Italy might find it difficult, due to the contested Italian rules, to move within Italy, could not in any way, affect his right to move to other member states in order to work, and thus the impugned rules could not amount to a violation of Article 39 EC” ( Iorio v. Azienda Autonoma Delle Ferrovie Dello Stato). “Having a higher household income and better working conditions” are often the “most important factors” which encourage Europeans to move to another country (ETUC 10). However, the big disparity in living conditions for new immigrants in the receiving country including “risks of poverty, and difficulties in accessing housing, health care and other social services” raise concerns as to “serious social problems and a waste of economic benefits of mobility” (ETUC 10). Added to the above-mentioned concerns are the judgments of the European Court of Justice (ECJ) which “have increased concerns over social dumping” and other problems which negatively impacts on the workers and citizens reliance on the benefits of the internal market. The European Trade Union Confederation notes that the “ECJ confirmed a hierarchy of norms, with market freedoms highest in the hierarchy and the fundamental rights of collective bargaining and action in second place” (ETUC 10). It commented that “although the ECJ refers to a balance between economic and social rights, it treats in fact the fundamental rights to collective bargaining and to collective action primarily as potential restrictions to economic freedoms” (ETUC 10). Furthermore, it pointed out the weakness of the legal framework on posted workers, “as the ECJ interpreted the Posting Directive in a very restrictive way, limiting the scope for Member States and trade unions to adequately protecting posted workers against unfair competition on wages and employment conditions” (ETUC 10). Because of the ECJ rulings, ETUC stated that “the general principle of non discrimination between local and foreign companies/service providers is no longer respected” (ETUC 11). Hence, resulting in an “unequal treatment of workers” (ETUC 11). ETUC explained that whilst “a foreign subcontractor can only be held liable for minimum levels of pay and working conditions in the host country,” the domestic (sub)contractors on the other hand requires that apply a “higher (collectively agreed) standards,” which they claimed opens the door for social dumping (ETUC 11). Thus, instead of having “a level playing field for foreign and domestic companies/service providers,” the ETUC comments that this may lead to “reverse discrimination like a discrimination against local companies” (ETUC 11). ETUC explains further that the actions of trade unions when favourable to workers, the judgments of the ECJ limits such actions on the ground that such collective action must respect the Posted Workers Directive, which then limits the trade unions actions “to fight for the improvement of the living and working conditions of workers, including demanding equal treatment of workers in the place where the work is done” (ETUC 11). In the case of Laval, the Latvian company, Laval, “which won a public tender in Sweden to renovate a school near Stockholm, posted workers to Sweden” (ECJ 18 Dec. 2007, C-34I/05, Laval un Partneri Ltd v. Svenska Byggnadsarbetareforbundet and Other, Rec. 2007, p. I-11767) Because of the concern that such “posting of cheaper labour to Sweden would threaten the position of Swedish construction workers, the trade union encouraged Laval to comply with the local terms and conditions of employment laid down in the collective agreement” (ECJ 18 Dec. 2007). Laval refused to sign the existing collective agreement thus leading the workers to picket in Laval building sites (ECJ 18 Dec. 2007). Laval then “called on the Swedish Labour Court to rule the action unlawful” which in turn sought “guidance from the ECJ on whether the trade unions’ actions circumscribed EU law, more specifically the provisions of Council Directive 96/71/EC concerning the posting of workers in the framework of the provision of services” (ECJ 18 Dec. 2007). The ECJ however ruled that “although the ECJ recognises the right of trade unions to undertake collective action, it pointed out that such industrial action did represent a restriction on the freedom to provide services, where it makes the provision of such services ‘less attractive’” (ECJ 18 Dec. 2007). In short, the ECJ ruled that although the right to strike is a fundamental right, it is not however “as fundamental as the right of businesses to supply cross-border services” (ECJ 18 Dec. 2007). This ruling, according to ETUC was a license to social dumping (ETUC 1). In another case, the ECJ resolved the issue on “the right of public authorities, when awarding contracts for work, to demand that tendering companies commit themselves to pay wages that are in line with rates already agreed through collective bargaining in the place where the work is done” (ETUC 1). The ECJ ruled again in favor of businesses in that such “obligation to pay the collectively agreed wage rates was not justified by the objective of ensuring the protection of workers” (ETUC 1). Hence, in these cases, the rulings made by the European Court of Justice affects the access to labour market which most often than not do not really establish sufficient protection to workers and even worsens discrimination against workers within Member States by favoring the decision of businesses rather than protection for workers. These interpretations significantly establishes the proposition that discrimination is now based on access to labour market by restrictively following such a council directive. There is therefore a need to reassess such a policy and provide a standard more into balancing the need for protection of workers as well. Works Cited Article 45 of the Treaty on the Functioning of the European Union. ECJ 18 Dec. 2007, C-34I/05, Laval un Partneri Ltd v. Svenska Byggnadsarbetareforbundet and Other, Rec. 2007, p. I-11767. European Trade Union Confederation (ETUC). Laval Case. Web. 3 May 2010. . European Trade Union Confederation (ETUC). Ruffert Case. Web. 3 May 2010. . European Trade Union Confederation (ETUC) and Confédération Européenne des Syndicats (CES). Report on joint work of the European social partners on the ECJ rulings in the Viking, Laval, Rüffert and Luxembourg cases. Business Europe. 19 March 2010. Web. 3 May 2010. . Iorio v. Azienda Autonoma Delle Ferrovie Dello Stato, Case No. 298/84 [1986] ECR 247. Tryfonidou, Alina. Reverse Discrimination in EC Law. The Netherlands: Kluwer Law International, BV, 2009. Print. Read More