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On social and economic factors in the developing European labour law

Reasoning on collective redundancies, transfer of undertakings and converse pyramids

Jari Hellsten

Arbetslivsinstitutet 2005, 76 s. ISBN 9170457611
Bogomtale fra forlaget.

This paper explores the relationship and interplay of economic and social dimensions in the EC legal order. The paper comprises two interlinked chapters. The first one includes a recap of the history until the 1970’s of the E(E)C as necessary to discuss the directives on collective redundancies and transfer of undertakings (acquired rights). When EC employment law emerged in the 1970’s, the Treaty of Rome remained intact, which means that only a change in the shared system of values explains this emergence. This change does not reveal any surprises in the Collective Redundancies Directive but with the Transfer of Undertakings (Acquired Rights) Directive the ‘what, when and why’ questions inevitably lead to a recognition of the cross-border applicability of the Directive. It is logical to assert that the Directive covers also cross-border corporate transfers. The transfers so governed occur between EC/EEA Member States and from them to third countries.
This requires us to reconsider many of the central notions of the Transfer Directive. The natural normative question is: what are the rights and obligations transferred? It seems that at least the notion of transfer, economic dismissal reasons at a transfer, collective agreement and law applicable necessitate rethinking and even reconsidering settled case law. This way ‘social’ (fundamental social rights) faces ‘economic’ (fundamental economic freedoms) on a crossborder level. Corporate cross-border transfers highlight many of these problems which, besides, may depend on a Community approval of larger mergers.
The second chapter of the article explores some theoretical attempts to explain the relationship between economic and social. It first presents the theory of converse pyramids as maintaining a rather straightforward dominance – even up to minutiae – of economic (and an undistorted internal market) over social. Such a rigid hierarchy thinking maybe was justified until the 1970’s. However, the author maintains that this theory is liable to several structural problems, linked even to the nature of the Community and its competence. The EC is a unique legal order, and its social constitution is a fortiori of such a nature. Examples concerning amongst others the right to strike, safety of machinery and competition rules in relation to collective bargaining (on the basis of case Albany) prove that precedence has been given, in at least some cases, to the social factor. Accordingly, sometimes, such as with safety of machinery, there is just one normative pyramid left. However, the author does not maintain any predicted dominance of the social factor either but believes that a versatile assessment in cases must take place. It remains to be seen whether and to what extent the European Constitution will affect this issue.