Laval Un Partneri Ltd v Svenska Byggnadsarbetareforbundet
Encyclopedia
Laval Un Partneri Ltd v Svenska Byggnadsarbetareförbundet [2008] IRLR 160 (C-319/05) is an EU law case, relevant to all labour law
within the European Union, including UK labour law, which held that there is a positive right to strike. However, it also held that the right to strike must be exercised proportionately and in particular this right was subject to justification where it could infringe the right to freedom to provide services under the Treaty on the Functioning of the European Union article 56 (ex TEC article 49).
Laval was shortly preceded by another case involving the right to strike on freedom of establishment The Rosella, and by the influential European Court of Human Rights
decision in Demir and Baykara v Turkey
.
n company, Laval Un Partneri Ltd won a contract from the Swedish government to renovate schools. Laval Ltd posted Latvian workers to Sweden to work on site. These workers earned much less than comparable Swedish workers. The Swedish Building Workers' Union (Svenska Byggnadsarbetareforbundet) asked Laval Ltd to sign its collective agreement. This collective agreement would have been more favourable than the terms required to protect posted workers under the Posted Workers Directive
, and also contained a clause for setting pay that would not allow Laval Ltd to determine in advance what the pay would be. Laval Ltd refused to sign the collective agreement
. The Swedish Builders Union, supported by the Electricians Union called a strike to blockade Laval Ltd's building sites. As a result, Laval Ltd could not do business in Sweden. It claimed that the blockade infringed its right to free movement of services under TEC article 49 (now TFEU article 56). The Swedish court referred the matter to the ECJ.
may constitute an overriding reason of public interest" which could justify an infringement of free movement of services. However, in this case, it did not, because the systems for Sweden's collective bargaining was felt to be not precise enough for the company to know its obligations in advance.
Labour law
Labour law is the body of laws, administrative rulings, and precedents which address the legal rights of, and restrictions on, working people and their organizations. As such, it mediates many aspects of the relationship between trade unions, employers and employees...
within the European Union, including UK labour law, which held that there is a positive right to strike. However, it also held that the right to strike must be exercised proportionately and in particular this right was subject to justification where it could infringe the right to freedom to provide services under the Treaty on the Functioning of the European Union article 56 (ex TEC article 49).
Laval was shortly preceded by another case involving the right to strike on freedom of establishment The Rosella, and by the influential European Court of Human Rights
European Court of Human Rights
The European Court of Human Rights in Strasbourg is a supra-national court established by the European Convention on Human Rights and hears complaints that a contracting state has violated the human rights enshrined in the Convention and its protocols. Complaints can be brought by individuals or...
decision in Demir and Baykara v Turkey
Demir and Baykara v Turkey
Demir and Baykara v Turkey [2008] is a landmark European Court of Human Rights case concerning Article 11 ECHR and the right to engage in collective bargaining...
.
Facts
A LatviaLatvia
Latvia , officially the Republic of Latvia , is a country in the Baltic region of Northern Europe. It is bordered to the north by Estonia , to the south by Lithuania , to the east by the Russian Federation , to the southeast by Belarus and shares maritime borders to the west with Sweden...
n company, Laval Un Partneri Ltd won a contract from the Swedish government to renovate schools. Laval Ltd posted Latvian workers to Sweden to work on site. These workers earned much less than comparable Swedish workers. The Swedish Building Workers' Union (Svenska Byggnadsarbetareforbundet) asked Laval Ltd to sign its collective agreement. This collective agreement would have been more favourable than the terms required to protect posted workers under the Posted Workers Directive
Posted Workers Directive
The EU Posted Workers Directive is an EU directive concerned with the free movement of workers within the European Union. It makes an exception to the Convention on the Law Applicable to Contractual Obligations 1980, which ordinarily requires that workers are protected by the law of the member...
, and also contained a clause for setting pay that would not allow Laval Ltd to determine in advance what the pay would be. Laval Ltd refused to sign the collective agreement
Collective agreement
A collective agreement or collective bargaining agreement is an agreement between employers and employees which regulates the terms and conditions of employees in their workplace, their duties and the duties of the employer...
. The Swedish Builders Union, supported by the Electricians Union called a strike to blockade Laval Ltd's building sites. As a result, Laval Ltd could not do business in Sweden. It claimed that the blockade infringed its right to free movement of services under TEC article 49 (now TFEU article 56). The Swedish court referred the matter to the ECJ.
Judgment
The ECJ held that, following ITWF v Viking Lines ABP, the "right to take collective action for the protection of the workers of the host state against possible social dumpingSocial dumping
"Social dumping" is a term that is used to describe a temporary or transitory movement of labour, whereby employers use workers from one country or area in another country or area where the cost of labour is usually more expensive, thus saving money and potentially increasing profit.It was also...
may constitute an overriding reason of public interest" which could justify an infringement of free movement of services. However, in this case, it did not, because the systems for Sweden's collective bargaining was felt to be not precise enough for the company to know its obligations in advance.
Significance
The case has been roundly condemned by labour and human rights lawyers throughout the European Union. After the onset of the economic crisis, the issue of posted workers triggered a significant amount of unrest, with police equipping themselves with riot gear in response to wildcat strikes over posted workers in the United Kingdom.See also
- The Rosella [2008] IRLR 143 (C-438/05), on freedom of establishment
- Demir and Baykara v TurkeyDemir and Baykara v TurkeyDemir and Baykara v Turkey [2008] is a landmark European Court of Human Rights case concerning Article 11 ECHR and the right to engage in collective bargaining...
(2009) 48 EHRR 54 - Commission of the European Communities v Grand Duchy of Luxembourg (C-319/06)