European Employment Law

Claire-Michelle Smyth

• Publisher: Business Expert Press
• Year: 2017
• ISBN:
  9781631579172
• Topic: Business
• Subtopic: Business Law
• Index: Business

Within Europe, employment law has grown as a result of regional rather than national legislation. The European Union has been at the fore of developing a comprehensive framework to protect workers from unfair practices and discrimination. In addition to the European Union, the Council of Europe also plays a role in protecting workers. The European Social Charter and the European Convention on Human Rights contain provisions relevant to the employment relationship. This publication will give the U.S. business student an overview of the key laws governing the area of employment in Europe. Here we look at the obligations and regulations surrounding the contract of employment, the laws surrounding equality and nondiscrimination, and the protection for unions and collective bargaining. Comparisons are drawn with American law and regulation at regular intervals to illustrate different practices within Europe and the United States. This book will provide the student with knowledge of the essential elements of European Employment Law in a concise and easy-to-understand manner.

CHAPTER 1

Introduction

In today’s business market, multinational transglobal entities are increasingly common. In such a global market businesses are not restricted to trading within their own country. Cross border international trade can account for a substantial portion of the business. As its international trade grows, it is likely that the business will have at least one office or hub outside of its country of origin.

In recent decades, Europe has been an attractive place for American businesses to thrive. With many European countries boasting a highly educated population, proficiency in the English language, and low taxes to encourage foreign direct investment, it has drawn many U.S. companies. Top American companies such as Google, Boston Scientific, Intel, Apple, and Facebook have bases in Ireland, and Microsoft, Cisco Systems, and American Express have offices in the UK. As American businesses open branches (and occasionally their headquarters) within Europe, this operation will be subject to European employment law. This law will operate and govern the employment relationship, from the hiring process through the employment contract and conditions of work to dismissal from employment. While there are certain similarities between European and American employment laws, it is of vital importance that the American employer or manager or indeed employee be aware of the employment laws that oversee and manage the employment relationship in Europe.

This guide is aimed at the American business student who may operate in some capacity within the European market and as such provides an overview of the key areas of European employment law. It is not a comprehensive or exhaustive text nor does it incorporate all of the laws governing employment law in Europe. It aims to give an overview of the key concepts, and the interested student is advised to further read the material referenced in the footnotes and bibliography for more in-depth analysis.

First, it is important to understand the sources of employment law within Europe. While they can derive from national law, regionally there are three sources of European Law that seek to harmonize law and practice within the region. While the European Union (EU) is the most assiduous in implementing and imposing employment laws and regulations, the European Social Charter (ESC) and the European Convention on Human Rights (ECHR) also play a role. The origin and scope of each of these three sources is discussed in Chapter 2. Chapter 3 examines the employment contract and sets out what each employee is entitled to in terms of that contract. Unlike America, the EU states that each employee must receive written terms of his or her employment. We consider how the employment contract is formed and what terms must be included in writing. Chapter 4, the lengthiest chapter in this publication, examines equality and nondiscrimination. This is a founding principle of EU employment law and determines that an employer will be in breach where a worker is discriminated against in hiring, working conditions, promotion, and pay on the grounds of sex, race, religion, sexual orientation, or age. The special protection given to pregnant women against discrimination is considered in Chapter 5. Another key aspect of EU law is the free movement of workers. In order to facilitate a free market and enhance productivity it was essential that member states be able to access skilled workers from their neighboring states within the EU. This was the beginning of free movement, which essentially removed any visa or permit requirements to travel and work in another member state. Chapter 6 looks at the evolution of this principle, including access to social welfare for migrating workers. The final chapter provides an example of where the EU does not provide a legislative framework and we look outside of the ESC and the ECHR for trade union rights and the right to bargain collectively.

Comparisons are drawn with American law where relevant and for illustration purposes. Overall, this guide should give the reader an insight into the key aspects of European employment law, including the employer’s responsibilities and the employee’s rights.

CHAPTER 2

Sources of European Employment Law

In Europe, there are three main sources of employment law: the European Union (EU), the European Social Charter (ESC), and the European Convention on Human Rights (ECHR). This chapter gives a brief overview of the creation, purpose, and scope of each of these sources.

The European Union

Following World War II in an attempt to rebuild Europe, foreign ministers decided in June 1955 to create a common economic institution and, in 1957, the European Economic Community was born.¹ Its sole purpose was to create and harmonize an internal economic market. The treaty created the three institutions of the EU: the Commission (which is the main legislator and has the power to bring states to the Court of Justice of the European Union for noncompliance); the Council of Ministers (who discuss, amend, and adopts laws); and the Parliament (the only directly elected body of the EU, which now has a colegislative role with the Commission). During its first decade, it also created the Court of Justice of the European Union (CJEU) (or the European Court of Justice, as it was then called).

The EU has evolved and its powers increased significantly since its creation, although its core purpose has remained. The EU is an inherently economic institution focused almost entirely on ensuring its economic stability. Business, and consequentially employment, plays an overwhelmingly large role in this and therefore it is logical that the EU would create laws to regulate both. Initially these legislative measures were concerned with removing barriers to trade and ensuring fair competition, but as their competences grew they became more involved in social cohesion and in developing a social policy. The Treaty on the Functioning of the European Union affirms its objective is to attain full employment while at the same time ensuring just conditions of work.²

There are a number of different sources of law within the EU itself and these are hierarchical. Primary sources of law are the treaties of the EU. These treaties create the legal order and they are binding on all member states. They are the superior law of the union and cannot be amended or revised outside the strict procedure set down in the treaties themselves. General principles of EU law are the unwritten rules of law that the CJEU would apply in order to avoid injustice, to fill a gap in EU law, or to strengthen the coherence of the law. As a general rule, they either form part of primary law or sit just below it, but remain above all other sources of EU law. In doing so, the court often draws on principles from established general principles or jus cogens of international law, such as the principle of legal certainty and procedural rights. Further, it can find general principles from the national systems of the member states. This does not require all member states to adopt a particular principle; it is sufficient that it is common to several.³

Secondary sources of EU law are ranked lower than the treaties and can be in the form of a Regulation, a Directive, or a Decision. Regulations are the most important of the secondary sources as they apply erga omnes (to everyone) simultaneously. A regulation has general application, explained in Koninklijke as applying “to objectively determine situations and produce legal effects with regard to persons described in a generalized and abstract manner.”⁴ A regulation is binding in its entirety, and incomplete or selective implementation is prohibited under EU law. Further, a regulation is directly applicable to all member states at the time of its entry into force.

Directives are used to harmonize the law throughout the union. They have no general application unless they are addressed to all member states. They impose an obligation on the state to fulfill a certain objective, but the method of achieving such is left to the member state to decide, as long as it chooses a path that ensures legal certainty and transparency. Directives will give the member state a certain amount of time in which to introduce the necessary law and/or procedure to give effect to the objective. The member state has responsibility to ensure that the directive is incorporated into national law. If the state fails or refuses to implement the directive within that time period, it becomes directly applicable in that member state; an individual may rely on it in national courts and the Commission may bring an action against that state for a breach of EU law.

Decisions, like directives, have no general application unless they are addressed to all member states. Decisions are binding from the date that they are made and against the member state to which they are addressed.

The CJEU as a source of EU law is complex. Its primary role is to interpret the laws of the EU and not create law. However, in practice, it has created law by bringing in general principles of EU law. A salient example of this is how the court has, over time, brought human rights within its scope. Here we can see three distinct phases of the court’s reasoning. The first phase is evident in the Stork case, where it refused to examine whether EU law was in compliance with the fundamental rights established in national constitutions.⁵ One reason for this outcome was based on the concept of supremacy (discussed in the following), but another was based on the fact that the treaties did not contain any reference to fundamental human rights. The court therefore focused on the economic goals, leaving human rights eminently rejected.⁶

The second phase is where the court, following pressure from member states, began to modify its position. In Stauder, the court remarked obiter that fundamental rights formed part of the general principles of EU law.⁷ This ruling was expanded upon in Internationale Handelsgellschaft, which is the first case that formally recognized fundamental rights as forming part of community law as deriving from the national constitutions of member states.⁸ In Nold, the court enunciated an additional basis for incorporating fundamental rights into community law (supplementary to national constitutions) and into international human rights treaties, in particular the ECHR.⁹ However, the court in Grant explained that there is a limitation in engaging with human rights, in that those fundamental rights cannot have the effect of extending a treaty provision beyond the competence of the EU.¹⁰

The third and final phase is the determination that the protection of fundamental rights extends not only to EU institutions but also to member states. This was initially a highly controversial move, given the lack of uniform application of fundamental rights within the member states, but also because of the haphazard development of the case law. This has since been ameliorated with the entry into force of the Charter of Fundamental Rights of the European Union, which gives the court broad powers to scrutinize whether member states are acting in a manner compatible with the human rights.¹¹

Under EU law, there is no doctrine of precedent. Previous case law is not binding and the CJEU follows a civil law approach to precedent. The doctrine of precedent, also known as stare decisis, is a cornerstone of the common law system and means “let the decision stand.” In operation it has the effect of ensuring that lower courts are bound by the decision of higher courts, and courts of the same jurisdiction should not depart from their previous ruling unless there is good reason to do so. This ensures consistency and stability in determinations. As the CJEU does not operate on a system of precedent it is very difficult to see how the judgments of the court could form part of the law of the EU, if they are liable to be repealed or changed with every new case. However, in practice, the court does respect its own previous decisions as to depart radically from them would be to undermine itself. Over the years it has played an important role in building up a body of consistent and coherent case laws, setting the benchmark for member states.

Two fundamental principles of EU law created by the CJEU ensure compliance and uniform application of law and principles throughout member states: the supremacy of EU law and also its...

Table of contents

• Cover
• Half-title Page
• Title Page
• Copyright
• Contents
• Chapter 1 Introduction
• Chapter 2 Sources of European Employment Law
• Chapter 3 The Employment Contract
• Chapter 4 Equality and Nondiscrimination
• Chapter 5 Protection for Pregnant Workers
• Chapter 6 Free Movement of Workers
• Chapter 7 Trade Unions and Collective Bargaining
• Bibliography
• Index
• Backcover