European Law Report - Labour market access
The free movement of workers is one of the fundamental freedoms of the EU that enables citizens of one member state to travel to another to work there on either a permanent or temporary basis. Workers thus have the right to move to different member...
The free movement of workers is one of the fundamental freedoms of the EU that enables citizens of one member state to travel to another to work there on either a permanent or temporary basis. Workers thus have the right to move to different member states, seek job opportunities, and be employed under the same conditions as nationals of that state and benefit from the same social and tax advantages. This right is codified in the EU Treaty itself.
However, for member states that joined the EU in 2004 and 2007 there is a transitional period allowing the "old" EU countries to protect their job market from workers from new member states for a period of up to seven years. The possibility of restricting free movement will be allowed until December 31, 2011 and after this date restrictions will only be allowed if there are serious labour market concerns. All restrictions will have to be lifted by December 31, 2013.
What prompted these transitional regulations was a fear within the then EU-15 countries that their job markets would be flooded with cheap labour from the new member states. Yet, the Posted Workers Directive and the subsequent two landmark judgements delivered by the European Court of Justice, known as the Viking and Laval cases, allow foreign companies to bring in workers from other countries, and grant them different employment conditions than similar national workers. In some cases, this has led foreign companies to pay their posted workers less than stipulated in local collective agreements.
This situation led to recent anti-foreigner strikes by British employees after an increasing number of construction contracts in the UK were awarded to foreign companies that hired foreign workers. In the wake of these strikes, some have called for a review of EU employment legislation, claiming that foreigners are taking the work of the nationals. The Posted Workers Directive has come under attack due to the "legal loophole" it contains, leading trade unions, employers as well as employees to call for its revision, particularly due to the rising unemployment in some member states. In addition trade unions are claiming that the current legal situation does not allow them to defend their members against social dumping, or the use of cheaper staff from other EU member states.
Limiting the right of free movement of workers, however, goes against the very nature of a free labour market, which is one of the four tenets of the bloc's founding treaty. In fact, the European Commission recently ruled that it did not have an intention of changing the current EU employment framework, including the Posted Workers Directive. It reached this decision in view of the job increase and prosperity that free movement of workers has brought to the EU since its introduction.
In its report based on statistical information, the Commission demonstrated how worker mobility in the EU had a positive impact on the economies of member states without leaving serious disturbances on national labour markets. It also claimed that free labour mobility is self-regulatory by nature and provides a much needed flexibility in both directions: workers go to where there is demand for labour and many leave again when employment conditions become less favourable. Supporting the Commission's approach are a number of new EU member states that have backed the Europe-wide free single market.
Until now the principle of free movement of workers has not buckled under strikes and protests, and if it survives the current economic climate, a change will be unlikely.
• Dr Grech is an associate with Guido de Marco & associates and heads its European law division.
However, for member states that joined the EU in 2004 and 2007 there is a transitional period allowing the "old" EU countries to protect their job market from workers from new member states for a period of up to seven years. The possibility of restricting free movement will be allowed until December 31, 2011 and after this date restrictions will only be allowed if there are serious labour market concerns. All restrictions will have to be lifted by December 31, 2013.
What prompted these transitional regulations was a fear within the then EU-15 countries that their job markets would be flooded with cheap labour from the new member states. Yet, the Posted Workers Directive and the subsequent two landmark judgements delivered by the European Court of Justice, known as the Viking and Laval cases, allow foreign companies to bring in workers from other countries, and grant them different employment conditions than similar national workers. In some cases, this has led foreign companies to pay their posted workers less than stipulated in local collective agreements.
This situation led to recent anti-foreigner strikes by British employees after an increasing number of construction contracts in the UK were awarded to foreign companies that hired foreign workers. In the wake of these strikes, some have called for a review of EU employment legislation, claiming that foreigners are taking the work of the nationals. The Posted Workers Directive has come under attack due to the "legal loophole" it contains, leading trade unions, employers as well as employees to call for its revision, particularly due to the rising unemployment in some member states. In addition trade unions are claiming that the current legal situation does not allow them to defend their members against social dumping, or the use of cheaper staff from other EU member states.
Limiting the right of free movement of workers, however, goes against the very nature of a free labour market, which is one of the four tenets of the bloc's founding treaty. In fact, the European Commission recently ruled that it did not have an intention of changing the current EU employment framework, including the Posted Workers Directive. It reached this decision in view of the job increase and prosperity that free movement of workers has brought to the EU since its introduction.
In its report based on statistical information, the Commission demonstrated how worker mobility in the EU had a positive impact on the economies of member states without leaving serious disturbances on national labour markets. It also claimed that free labour mobility is self-regulatory by nature and provides a much needed flexibility in both directions: workers go to where there is demand for labour and many leave again when employment conditions become less favourable. Supporting the Commission's approach are a number of new EU member states that have backed the Europe-wide free single market.
Until now the principle of free movement of workers has not buckled under strikes and protests, and if it survives the current economic climate, a change will be unlikely.
• Dr Grech is an associate with Guido de Marco & associates and heads its European law division.