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Freedom to conduct a business and EU labour law

Published online by Cambridge University Press:  15 March 2018

Stefano Giubboni
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Abstract

Critical-contextual analysis of case law of the European Court of Justice on employers’ contractual freedom – Fundamental right to be immunised against the alleged disproportional protection enjoyed by employees – Progressive ideological overthrow of the original constitutional assumptions of the founding treaties – Prominent example of ‘displacement of social Europe’ – Court of Justice’s case law on the relationship between freedom to conduct a business and labour law – Neoliberal understanding of the freedom of enterprise – Alternative interpretation of Article 16 of the EU Charter of Fundamental Rights

Type
The Displacement of Social Europe – Special Section
Information
European Constitutional Law Review , Volume 14 , Issue 1 , March 2018 , pp. 172 - 190
Copyright
Copyright © The Authors 2018 

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Footnotes

*

University of Perugia.

References

1 AG Wahl, para. 1 of the conclusions delivered on 9 June 2016 in ECJ 21 December 2016, Case C-201/15, Anonymi Geniki Etairia Tsimenton Iraklis (AGET Iraklis) v Ypourgos Ergasias, Koinonikis Asfalisis kai Koinonikis Allilengyis.

2 ECJ 11 December 2007, Case C-438/05, International Transport Workers’ Federation and Finnish Seamen’s Union v Viking Line ABP and OÜ Viking Line Eesti; ECJ 18 December 2007, Case C-341/05, Laval un Partneri Ltd v Svenska Byggnadsarbetareförbundet, Svenska Byggnadsarbetareförbundets avdelning 1, Byggettan and Svenska Elektrikerförbundet; ECJ 3 April 2008, Case C-346/06, Dirk Rüffert v Land Niedersachsen; ECJ 19 June 2008, Case C-319/06, Commission of the European Communities v Grand Duchy of Luxemburg.

3 See Ruggie, J.G., ‘International Regimes, Transactions, and Change: Embedded Liberalism in the Postwar Economic Order’, 36(2) International Organization (1982) p. 379 Google Scholar, who borrowed from the classic economic sociology of Polanyi, K., The Great Transformation. The Political and Economic Origins of Our Time (Farrar & Rinehart 1944)Google Scholar (Beacon Press 2001 with a preface by J.E. Stiglitz and an introduction by F. Block). Among EU labour law scholars, see e.g. Giubboni, S., Social Rights and Market Freedom in the European Constitution (Cambridge University Press 2006)Google Scholar; Schiek, D., Economic and Social Integration: The Challenge for EU Constitutional Law (Edward Elgar 2012)Google Scholar; Ashiagbor, D., ‘Unravelling the Embedded Liberal Bargain: Labour and Social Welfare Law in the Context of EU Market Integration’, 19(3) ELJ (2013) p. 303 Google Scholar.

4 Lyon-Caen, G., L’infiltration du Droit du travail par le Droit de la concurrence, Dr. ouvrier (1992) p. 313 Google Scholar.

5 Now Art. 34 TFEU.

6 AG Tesauro, para. 1 of the conclusions delivered on 27 October 1993 in ECJ 15 December 1993, Case C-292/92, Ruth Hünermund v Landesapothekerkammer Baden-Württemberg. Similarly, AG Van Gerven, conclusions delivered on 29 June 1989 in ECJ 23 November 1989, Case C-145/88, Torfaen Borough Council v B & Q plc.

7 C. Kilpatrick, ‘The Displacement of Social Europe’, introduction to this special issue.

8 Cf also Markakis, M., ‘Can Governments Control Mass Layoffs by Employers? Economic Freedom vs Labour Rights in Case C-201/15 AGET Iraklis ’, 13(4) ECLR (2017) p. 724 Google Scholar.

9 ECJ 14 May 1974, Case 4/73, J. Nold, Kohlen- und Baustoffgroßhandlung v Commission of the European Communities.

10 ECJ 17 December 1970, Case 11/70, Internationale Handelsgesellschaft mbH v Einfuhr- und Vorratsstelle für Getreide und Futtermittel.

11 Cf Usai, A., ‘The Freedom to Conduct a Business in the EU, Its Limitations and Its Role in the European Legal Order: A New Engine for Deeper and Stronger Economic, Social, and Political Integration’, 14(9) German Law Journal (2013) p. 1867 Google Scholar.

12 This approach is adopted also by Massimo Luciani, who – in denying the autonomy of the concept of economic constitution – recalls how ‘the economic structure model outlined in the Constitution is […] tightly linked to the constitutional system of social and political relationships’: Luciani, M., ‘Economia nel diritto costituzionale’, 5 Digesto delle Discipline pubblicistiche (1990) p. 373 at p. 376Google Scholar.

13 Dahrendorf, R., The Modern Social Conflict. An Essay on the Politics of Liberty (Weidenfeld & Nicolson 1988) p. 116 Google Scholar.

14 Kahn Freund, O., Labour and the Law, 2nd edn. (Steven & Sons 1977) p. 6 Google Scholar.

15 This refers to the famous judgments delivered by the Court in ECJ 11 July 1974, Case 8/74, Procureur du Roi v Benoît and Gustave Dassonville, and ECJ 20 February 1979, Case 120/78, Rewe-Zentral AG v Bundesmonopolverwaltung für Branntwein, respectively.

16 This aspect is very well described by Syrpis, P. and Novitz, T., ‘The EU Internal Market and Domestic Labour Law: Looking beyond Autonomy’, in A. Bogg et al. (eds.), The Autonomy of Labour Law (Hart Publishing 2015) p. 291 Google Scholar.

17 Cf, among others, Supiot, A., ‘Le droit du travail bradé sur le “marché de normes”’, 12 Dr. Soc. (2005) p. 1087 Google Scholar, and ‘Law and Labour’, 39 New Left Rev. (2006) p. 109.

18 Cf Giubboni, S., ‘Social Insurance Monopolies in Community Competition Law and the Italian Constitution: Practical Convergences and Theoretical Conflicts’, 7(1) ELJ (2001) p. 69 Google Scholar.

19 Niglia, L., ‘Eclipse of the Constitution (Europe Nouveau Siècle)’, 22(2) ELJ (2016) p. 132 at p. 134Google Scholar.

20 ECJ 27 March 1990, Case C-113/89, Rush Portuguesa Ldª v Office national d’immigration.

21 ECJ 21 September 1999, Case C-67/96, Albany International BV v Stichting Bedrijfspensioenfonds Textielindustrie. In a similar vein, see also ECJ 21 September 1999, Joined Cases C-115/97, C-116/97, and C-117/97, Brentjens’ Handelsonderneming BV v Stichting Bedrijfspensioensfonds voor de Handel in Bouwmaterialen.

22 ECJ 18 July 2013, Case C-426/11, Mark Alemo-Herron v Parkwood Leisure Ltd. Cf Weatherill, S., ‘Use and Abuse of the EU’s Charter of Fundamental Rights: On the Improper Veneration of Freedom of Contract’, 10(1) ERCL (2014) p. 167 Google Scholar. See also Prassl, J., ‘Freedom of Contract as a General Principle of EU Law? Transfer of Undertakings and the Protection of Employer Rights in EU Labour Law’, 42(4) ILJ (2013) p. 434 Google Scholar.

23 As noted by Christodoulidis, E., ‘The European Court of Justice and the “Total Market” Thinking’, 14(10) German Law Journal (2013) p. 2005 at p. 2006Google Scholar, ‘the neoliberal move […] collapses the competition – between rights and freedoms – and […] smoothes over their friction by elevating market access as underlying premise, underwriting and providing the measure of the “reconciliation” of social rights and economic freedoms on a common register’.

24 Cf Trstenjak, V. and Beysen, E., ‘The Growing Overlap of Fundamental Freedoms and Fundamental Rights in the Case Law of the CJEU’, 3 ELR (2013) p. 293 Google Scholar; De Cecco, F., ‘Fundamental Freedoms, Fundamental Rights, and the Scope of Free Movement Law’, 15(3) German Law Journal (2014) p. 383 Google Scholar.

25 Azoulai, L., ‘The Court of Justice and the Social Market Economy: The Emergence of an Ideal and the Conditions for Its Realization’, 45(5) CMLRev (2008) p. 1335 at p. 1345Google Scholar.

26 In the Italian system, the seminal distinction between damage to production and damage to productivity applies. The distinction was introduced in Italian Court of Cassation, judgment No. 711 dated 30 January 1980, which represents ‘a true watershed in the orientation of the case law on the subject’: G. Giugni, Diritto sindacale, updated by L. Bellardi, P. Curzio, and V. Leccese (Cacucci 2014) p. 279.

27 Cf Portuese, A., ‘The Principle of Proportionality as a Principle of Efficiency’, 19(5) ELJ (2013) p. 612 Google Scholar.

28 Azoulai, supra n. 25, p. 1350-1351.

29 Originally published in 1933, it has been recently republished in English: Heller, H., ‘Authoritarian Liberalism?’, 21(3) ELJ (2015) p. 295 Google Scholar.

30 Wilkinson, M.A., ‘The Specter of Authoritarian Liberalism: Reflections on the Constitutional Crisis of the European Union’, 14(5) German Law Journal (2013) p. 527 Google Scholar; Wilkinson, M.A., ‘Authoritarian Liberalism in the European Constitutional Imagination: Second Time as Farce?’, 21(3) ELJ (2015) p. 313 Google Scholar. Similarly, cf Scheuerman, W.E., ‘Hermann Heller and the European Crisis: Authoritarian Liberalism Redux?’, 21(3) ELJ (2015) p. 302 Google Scholar; Somek, A., ‘Delegation and Authority: Authoritarian Liberalism Today’, 21(3) ELJ (2015) p. 340 Google Scholar.

31 Deakin, S., ‘Regulatory Competition after Laval’, 10 CYELS (2007-2008) p. 581 at p. 582Google Scholar.

32 Deakin, supra n. 31, p. 587.

33 Cf Babayev, R., ‘Private Autonomy at the Union Level: On Article 16 CFREU and Free Movement Rights’, 53(4) CMLRev (2016) p. 979 Google Scholar, and ‘Contractual Discretion and the Limits of Free Movement Law’, 23(5) ERPL (2015) p. 875.

34 ECJ 18 July 2013, supra n. 22, paras. 33-35.

35 Cf Weatherill, supra n. 22, p. 172.

36 Lyon-Caen, G., Le droit du travail. Une technique réversible (Dalloz 1995)Google Scholar.

37 Leczykiewicz, D., ‘Horizontal Effect of Fundamental Rights: In Search of Social Justice or Private Autonomy in EU Law?’, in U. Bernitz et al. (eds.), General Principles of EU Law and European Private Law (Kluwer Law International 2013) p. 171 at p. 172Google Scholar.

38 Hesselink, M.W., ‘The Justice Dimensions of the Relationship between Fundamental Rights and Private Law’, 24(3/4) ERPL (2016) p. 425 at p. 447Google Scholar, who obviously refers to U.S. Supreme Court, Lochner v New York, 198 U.S. 45 (1905). For an analogous criticism, cf Giubboni, S., Diritto del lavoro europeo. Una introduzione critica (Cedam 2017) p. 79 Google Scholar. The implicit and perhaps unconscious criticism of Lochnerism by the Luxembourg Court will be dealt with in the concluding paragraph.

39 Cf ECJ 27 April 2017, Joined Cases C-680/15 and C-681/15, Asklepios Kliniken Langen-Seligenstadt GmbH v Ivan Felja and Asklepios Dienstleistungsgesellschaft mbH v Vittoria Graf, which also deals with the question of whether Article 3 of Directive 2001/23 allows national legislation (in the case at hand, the German Civil Code) to authorise the incorporation of dynamic clauses into an employment contract, i.e. clauses referring dynamically to collective agreements even after the date of the transfer of the undertaking.

40 ECJ 27 April 2017, supra n. 39, para. 19.

41 ECJ 27 April 2017, supra n. 39, para. 21.

42 ECJ 27 April 2017, supra n. 39, para. 22.

43 ECJ 27 April 2017, supra n. 39, para. 23 (emphasis added).

44 AG Wahl, supra n. 1, para. 27.

45 AG Wahl, supra n. 1, para. 32.

46 ECJ 21 December 2016, Case C-201/15, Anonymi Geniki Etairia Tsimenton Iraklis (AGET Iraklis) v Ypourgos Ergasias, Koinonikis Asfalisis kai Koinonikis Allilengyis, para. 35.

47 ECJ 21 December 2016, supra n. 46, paras. 36, 37, and 38.

48 See AG Wahl, supra n. 1, para. 75.

49 Cf Baylos Grau, A. and Pérez Rey, J., El despido o la violencia del poder privado [On dismissal, or on the violence of power] (Editorial Trotta 2009)Google Scholar.

50 Jeammaud, A., ‘Le droit du travail dans le capitalisme, question de fonctions et de fonctionnement’, in A Jeammaud (ed.), Le droit du travail confronté à l’économie (Dalloz 2005) p. 15 at p. 27Google Scholar.

51 Collins, H., ‘The Impossible Necessity of European Labour Law’, in S. Muller et al. (eds.), The Law of Future and the Future of Law (Torkel Opsahl Academic EPublisher 2011) p. 453 at p. 464Google Scholar.

52 See e.g. Hesselink, supra n. 38, p. 447; and Eliasoph, I.H., ‘A “Switch in Time” for the European Community? Lochner Discourse and the Recalibration of Economic and Social Rights in Europe’, 14(3) CJEL (2008) p. 467 Google Scholar.

53 Sunstein, C.R., ‘Lochner’s Legacy’, 87(5) Columbia Law Review. (1987) p. 873 Google Scholar.

54 Sunstein, supra n. 53, p. 874.

55 For a more explicit dissertation, cf Justices J.M. Harlan, E.D. White, and W.R. Day, dissenting, 198 U.S. 65 (1905), in U.S. Supreme Court, supra n. 38.

56 Justice O.W. Holmes Jr., dissenting, 198 U.S. 75 (1905), in U.S. Supreme Court, supra n. 38.

57 Joerges, C., ‘A New Alliance of De-legalisation and Legal Formalism? Reflections on Responses to the Social Deficit of the European Integration Project’, 19(3) Law and Critique (2008) p. 235 at p. 252Google Scholar.