Unions fear ‘political’ EU court opinion could unpick rules on posting workers

The main question facing the court is whether "substantial activity" must take place in the country from which the workers are being posted. [EPA-EFE/JULIEN WARNAND]

Trade unions in the construction sector fear that a “political” opinion from the European Court of Justice could lead to the overhaul the rules on the posting of workers employed with companies that hire out temporary staff and the single market.

At the heart of the case is TeamPower Europe, a Bulgaria–based company that hires out and places temporary workers. Most workers are sent to undertakings that hire abroad.

The main question facing the court is whether “substantial activity” must take place in the country from which the workers are being posted.

The firm applied for certificates of social security coverage in Bulgaria for workers sent to Germany, which were rejected by local authorities on the grounds that the company does not perform substantial activity in Bulgaria. This would then lead to the application of German social security, which is more costly than the Bulgarian equivalent.

In his opinion, the advocate general contended that: “unless the existence of fraud or abuse is established, it is not necessary that a substantial part of its employee placement activity is performed for hirer undertakings established in the same member state.”

He also argued that work such as the selection and recruitment of temporary staff should count as an activity in Bulgaria.

The final ruling is expected in the coming days.

Campaigners say that the case is reminiscent of the controversial Viking, Laval and Rüffert cases over a decade ago, in which the Luxembourg–based court appeared to give a higher priority to the freedom of circulation of capital and labour across the European market than social protection and the rights of trade unions to take industrial action or make collective agreements.

Trade unions warn that if the opinion is upheld, it will provide an important incentive to set up letterbox companies, acting as temporary work agencies and posting cheap labour to other member states.

“This is a very dangerous opinion in our view,” Tom Deleu, the general secretary of the European Federation of Building and Woodworkers, told EURACTIV.

He added that the advocate general’s opinion was “in our view a very political position taken by the Court of Justice”.

Posting workers was initially intended for specialised companies, wanting to offer a service in another country, and to give them a legal framework to move within the EU.

The current legal framework states that there has to be a substantial activity in the sending country because otherwise they should not be seen as Bulgarian workers but as German workers.

Deleu adds that the Advocate General opinion “is redefining what ‘substantial activity’ means. He is saying that we should look at the workers performing the service but the office organising the sending abroad. This is changing the whole logic.”

“If this is confirmed then there is no legal restraint any more for any company to set up its own temporary work agency in Bulgaria, Romania or elsewhere. Any construction company could then easily set up its office in Bucharest and legally send these workers to Belgium, Sweden and Luxembourg but without the equivalent level of social protections,” he added.

“We would be very upset if it is confirmed and will address this with the European Commission and Parliament because this is not acceptable,” he said.

[Edited by Josie Le Blond]

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