European Trade Union Institute, ETUI.

Laval C-341/05

  • The facts

The Latvian company Laval won the tender for construction work at a school in the town of Vaxholm. They posted their workers from Latvia to Sweden to fulfil the contract. As is standard practice in the Swedish industrial relations system the Swedish unions started negotiations with Laval in order to sign a collective agreement with regard to wages and other working conditions, which are always laid down by negotiation on a case-by-case basis. As Laval did not want to pay the wages requested, they signed a collective agreement in Latvia. Following the failure of the Swedish negotiations, the Swedish trade unions took action by blockading the construction site. Solidarity actions then followed from the electricians trade unions.

  • The judgement

With regard to the right to strike as a fundamental right and the scope of the freedoms, the Laval judgement developed the earlier position set out by the Viking ruling. The ECJ again applies the proportionality test and says that collective action for the protection of the workers of the host State against social dumping may constitute an overriding reason of public interest, which in principle justifies a restriction on one of the fundamental freedoms. The means of blockading action by a trade union falls within the objective of protecting workers. But in the actual case concerned the action could not be justified due to an incorrect implementation of the posting of workers Directive.

Most of the judgement concerns the interpretation of this Directive. The ECJ is of the opinion that negotiation at the place of work, on a case-by-case basis, when minimum rates of pay are not determined in accordance with one of the means provided for by the posting of workers directive, are not permissible under the Directive. The Court put into question the flexibility of the Swedish collective bargaining system, emphasising the alleged lack of certainty for business unable to ascertain in advance the conditions they would have to guarantee to their posted workers.

The objective of the Posting of Workers Directive is to lay down a set of mandatory rules for minimum protection to be observed in the host country by employers who post workers to perform temporary work in the territory of a Member State where the services are provided. The ECJ now judges that the Directive limits the level of protection guaranteed to posted workers. Neither the host Member State nor the social partners can ask for more favourable conditions, which go beyond the mandatory rules for minimum protection in the Directive. This is now often referred to as a change from a minimum to a maximum Directive.

Read the judgement

Read the opinion of Advocate General MENGOZZI