K. D. Ewing, Austerity and the Importance of the ILO and the ECHR for the Progressive Development of European Labour Law: A Case Study from Greece in:

Wolfgang Däubler, Reingard Zimmer (ed.)

Arbeitsvölkerrecht, page 361 - 369

Festschrift für Klaus Lörcher

1. Edition 2013, ISBN print: 978-3-8487-0674-7, ISBN online: 978-3-8452-4921-6,

Bibliographic information
Austerity and the Importance of the ILO and the ECHR for the Progressive Development of European Labour Law: A Case Study from Greece K. D. Ewing Introduction In this tribute to Klaus Lörcher, I propose to show how a combination of ILO standards and ECHR rights could be used to confront the conduct of the European Commission and the European Central Bank, which along with the IMF imposed a number of deregulatory initiatives accepted by the Greek government. The attack on labour standards in Greece not only represented one of the greatest challenges to working conditions for some time, but also revealed a contempt for legality and an indifference to legal obligations on the part of the EU institutions concerned. The starting point is the agreement concluded between the Greek Ministry of Finance and the European Commission, the European Central Bank and the IMF (the Troika).1 In return for financial support, the Greek government undertook not only to reduce public sector pay, but also to change the legal framework for wage bargaining in the private sector. This would be in addition to minimum entry-level wages, a new control system for undeclared work, the extension of probationary periods, the increase in the use of part-time work, and the ‘recalibration’ of collective dismissals. The Greek Confederation of Trade Unions (GSEE) developed an impressive legal strategy in response to these measures. As a result, there has been an examination of a wide range of questions by the ILO Committee of Experts, while several complaints relating to the European Social Charter have been upheld by the Social Rights Committee.2 In addition, litigation was initiated in the national courts, challenging many of the Troika-imposed changes as being contrary to the Greek constitution. But there has been no reference to the CJEU, nor yet any complaint to Strasbourg. I. 1 Space does not permit a full consideration of the terms imposed. The details of much of what follows is drawn from ILO, Report of the High Level Mission to Greece (Geneva, 22 November 2011). 2 See Cases 65/2011 and 66/201: ts/Complaints_en.asp. ILO High Level Mission The GSEE was concerned that the foregoing legal and industrial relations changes violated a number of obligations of the Greek government arising under a wide range of ILO Conventions. Following its receipt of these concerns in 2011, the ILO Committee of Experts concluded that such was the complexity of the matter that the government of Greece should be invited to avail itself of the technical assistance of the ILO and to accept a High Level Mission ‘to facilitate a comprehensive understanding of the issues’ before the Committee proceeded to assess the impact of the austerity measures on the ratified Conventions. The High Level Mission was composed of ILO officials and produced a report that made sobering reading, highlighting the decentralisation of pay bargaining, the changing nature of the employment from permanent to flexible forms of engagement, and the swingeing cuts in public and private sector wage rates. Quite apart from their implications for workers as a whole, the measures were said to have a disproportionate impact on women, who were more likely to be bearing the brunt of the move to flexible employment arrangements and who were more likely to be employed in the public sector where jobs were being cut. At the heart of the austerity measures, however, was the desire of the Troika to secure an ‘internal devaluation’, defined to mean ‘a sharp reduction in wages and consequent living standards’. This was being imposed as an alternative to a currency devaluation which was not possible for Greece as part of the Eurozone. According to the ILO High Level Mission, the ‘internal devaluation’ was designed to enhance Greece’s competitiveness in the international economy, and would be achieved by ‘fundamentally revising the way the collective bargaining system functioned, especially at sectoral level’. The system operating in Greece was one where the national agreement set minimum terms and conditions for all workers. Sector agreements could then make specific provision in individual sectors to improve upon the national agreement, while enterprise agreements in turn could build upon the sectoral agreements in individual enterprises. Apart from imposing pay cuts by law and invalidating any provisions of collective agreements that made provision to the contrary, the austerity package also provided that both sector and enterprise-based agreements could make provision less favourable than that contained in the national agreement. Under the new law, moreover, ad hoc associations of employees could negotiate these latter arrangements where there were no trade unions. This last provision was a response by the Greek government to the concerns of the Troika that enterpriselevel agreements were not sufficiently widespread. This was because there were very few trade unions at enterprise level, with enterprise agreements applying only II. 362 K. D. Ewing to enterprises with more than 50 workers, and with Greek law requiring a minimum of 20 persons to establish an association. ILO Committee of Experts The report of the HLM was duly considered by the Committee of Experts in 2012, and a number of findings were made expressly about the compliance by Greece with international labour standards, and by implication about the role of the Troika in ensuring that it operated within a framework of legality.3 When the situation in Greece returned to the ILO Committee of Experts in 2012, the Committee was informed by the Report of the High Level Mission, but inadequately informed on all issues it seems, making a number of direct requests to the Greek government for more information on a number of questions. The Committee did, however, examine the complaints under ILO Conventions 100, 111 and 156, concerned about the impact of the ‘exponential growth of parttime work and the significant increase in rotation work’, and in particular the ‘dramatic increase of the number of full-time contracts of employment that had been unilaterally converted by the employer into rotation contracts’. The disproportionate impact of the crisis on women was ‘reportedly exacerbated by the inability of the labour inspectorate to effectively address equality cases’, while ‘delays in the administration of justice also discourage women from having recourse to the courts’. On freedom of association, the Committee found that there had been a breach of both ILO Conventions 87 and 98. The latter gave rise to particular concern, here the Committee challenging the procedures for the decentralization of collective bargaining, and in particular the procedures permitting derogation from sectoral agreements by non-union associations of workers at enterprise level. These latter provisions led the Committee to express ‘deep concern’ that the changes – ‘aimed at permitting deviations from higher level agreements through ‘negotiations’ with non-unionized structures’ – are ‘likely to have a significant – and potentially devastating – impact on the industrial relations system in the country’. This, however, was only the start, the Committee expressing the fear ‘that the entire foundation of collective bargaining in the country may be vulnerable to collapse under this new framework’. This was because 90% of the (private sector) workforce was employed in small enterprises, in a system where trade unions can- III. 3 See ILO, Report of the Committee of Experts on the Application of Conventions and Recommendations (2012), on which this account draws. See: /f?p=1000:13100:0::NO:13100:P13100_COMMENT_ID:2698934. Importance of ILO and ECHR for the Development of EU Labour Law 363 not legally be formed in enterprises with less than 20 employees. In these circumstances, granting collective bargaining rights to other types of workers’ representation which are not afforded the guarantees of independence that apply to the structure and formation of trade unions and the protection of its officers and members is likely to seriously undermine the position of trade unions as the representative voice of the workers in the collective bargaining process. The ‘risk’ that ‘the entire foundation of collective bargaining in the country may be vulnerable to collapse’, was reinforced ‘given that the abolition of the favourability principle set out [in legislation of 2010 and 2011] has the effect of nullifying the binding nature of collective agreements. Here the Committee recalled the general principle enunciated in ILO Recommendation 91 (Collective Agreements Recommendation, 1951) that collective agreements should bind the signatories thereto and those on whose behalf the agreement is concluded. Employers and workers bound by a collective agreement should not be able to include in contracts of employment stipulations contrary to those contained in the collective agreement. The Committee considers that this recognition of the principle of favourability should apply, according to the circumstances, to lower level collective agreements, unless the same parties are involved in the negotiations. Implications of ILO Developments The foregoing raises questions about whether the Troika (the IMF, the European Commission and the European Central Bank) were imposing conditions on Greece that were in breach of Greece’s obligations under international law.4 This gives rise to two questions of legal liability. First, in accepting these conditions, did the government of Greece act consistently with its obligations under the European Convention on Human Rights? And secondly, in imposing these conditions, did the EU institutions (the Commission and the European Central Bank) act consistently with their obligations under EU law? Implications for the ECHR I shall begin with the important implications of these developments for the liability of Greece under the European Convention on Human Rights (ECHR), particularly IV. 1. 4 Indeed, it seems that these institutions were wholly indifferent to some if not all of these obligations, the HLM being ‘struck by reports’ in relation to obligations under ILO Convention 122 (Employment Policy Convention, 1964) ‘that in discussions with the Troika employment objectives rarely figure’. 364 K. D. Ewing as they affect the right to collective bargaining. Art 11 of the ECHR protects the right to freedom of association, including the right to form and join trade unions for the protection of one’s interests, a provision that has been interpreted very narrowly by the European Court of Human Rights in the past. But this changed in 2008 with the unanimous decision of the Grand Chamber of the Court in Demir and Baykara v Turkey.5 In that case the Turkish Court of Cassation had annulled a collective agreement between a local government union and a local government employer on the ground that under Turkish law trade unions had no capacity to enter into collective agreements. In a wide – ranging decision that stretches well beyond its immediate facts, the European Court of Human Rights renounced its old jurisprudence and held that henceforward the right to freedom of association in Art 11 of the ECHR must be interpreted as including the right to bargain collectively. In the view of the Court having regard to the developments in labour law, both international and national, and to the practice of Contracting States in such matters, the right to bargain collectively with the employer has, in principle, become one of the essential elements of the right to form and to join trade unions for the protection of [one's] interests set forth in Article 11 of the Convention, it being understood that States remain free to organise their system so as, if appropriate, to grant special status to representative trade unions (para 154). The developments in international law to which the Court referred included a wide range of international treaties, such as the International Covenant on Economic, Social and Cultural Rights of 1966 (Art 8), ILO Conventions 98 and 151, the Council of Europe Revised Social Charter of 1996 (Art 6), and the EU Charter of Fundamental Rights of 2000 (Art 28). It is important to note that these instruments were relevant even though they had not been ratified or accepted by Turkey and even though in the case of the EU Charter they could not be ratified by Turkey. In engaging in this exercise, what the Court was doing was seeking to find the ‘centre of gravity’ in the Council of Europe on the right of public servants to engage in collective bargaining. In doing so, it referred not only to the various treaties already mentioned, but also the jurisprudence of the bodies responsible for supervising the treaties (such as the ILO Committee of Experts and the Council of Europe’s Social Rights Committee). In engaging in this exercise, the Court also took into account the position in the law, constitution and practice of other member states of the Council of Europe, concluding as follows: Accordingly, the Court observes that the collective bargaining in the present case and the resulting collective agreement constituted, for the trade union concerned, an essential means to promote and secure the interests of its members. The absence of the legislation necessary to give effect to the provisions of the international labour conventions already ratified by Turkey, and the Court of Cassation judgment of 6 December 1995 based on 5 [2008] ECHR 1345. Importance of ILO and ECHR for the Development of EU Labour Law 365 that absence, with the resulting de facto annulment ex tunc of the collective agreement in question, constituted interference with the applicants' trade-union freedom as protected by Article 11 of the Convention (para 157). The implications of this for the Greek situation and for the responsibilities of the Greek government seem fairly obvious: if it is a breach of Art 11 of the ECHR to annul a collective agreement in Turkey (in a manner that is inconsistent with ILO and other standards), it is at least strongly arguable that it must also be a breach of Art 11 of the ECHR to destroy an entire system of collective bargaining in Greece (in the manner described by the ILO High Level Mission in 2011 and the ILO Committee of Experts in 2012). This would give rise to the possibility of proceedings against Greece, which is responsible for upholding its obligations under the ECHR. It is true that Art 11(1) of the ECHR is not unqualified, and that Art 11(2) allows for restrictions on freedom of association to be introduced on a wide range of grounds (such as the need to protect the rights and freedoms of others, but unlike Art 8 not the ‘economic wellbeing of the country’), where these are prescribed by law and necessary in a democratic society. So far as I am aware, this provision has been rarely invoked successfully in the expanding body of case law that the Demir decision has generated.6 Implications for EU Law Turning from the responsibilities of Greece to the responsibilities of the EU institutions, the conduct of the Commission and the Bank as constituent members of the Troika would appear to be inconsistent with the obligations of both under the TEU, three provisions of which seem directly relevant. The first are the obligations under Art 2, which proclaims that the Union is ‘founded on the values of respect for human dignity, freedom, democracy, equality, the rule of law and respect for human rights’, in a society in which pluralism, non-discrimination, tolerance, justice, solidarity and equality between women and men prevail’ (emphasis added). Similar values are rehearsed in Art 3 which proclaims an obligation on the part of the Union to ‘combat social exclusion and discrimination’, and a duty to promote social justice and protection, equality between women and men, solidarity between generations and protection of the rights of the child’ (emphasis added). It is presumed that these provisions are meaningful and enforceable, and that they are not 2. 6 Indeed in the leading case in which Art 11(2) was successfully invoked by the respondent government, the Court was at pains to point out that its decision was consistent with the appropriate ILO instrument (in that case ILO Recommendation 143): Palomo Sanchez v Spain [2011] ECHR 1319. 366 K. D. Ewing the ‘beautifully worded Articles [which] were nothing but sententious platitudes, binding no one’, which famously according to Kahn Freund were said to be found in the Weimar Constitution.7 Perhaps more important is TEU, Art 6, which provides that the Union recognizes the rights, freedoms and principles set out in the EU Charter of Fundamental Rights, now said to have ‘the same legal value as the Treaties’. Art. 12 of the EU Charter of Fundamental Rights provides in turn that everyone has a right to freedom of association, said to imply ‘the right of everyone to form and to join trade unions for the protection of his or her interests’. This is particularly important in the light of the provisions of Art 52 (3), which provides that in so far as this Charter contains rights which correspond to rights guaranteed by the Convention for the Protection of Human Rights and Fundamental Freedoms, the meaning and scope of those rights shall be the same as those laid down by the said Convention. This provision shall not prevent Union law providing more extensive protection. Art 12 TEU of course corresponds directly (if not word for word) with ECHR (Art 11), relevant in view of the spectacular flowering of the latter in Demir and Baycara v Turkey, above, where as we have seen the Court held – having regard to ILO Convention 98 as well as other instruments (including the EU Charter!) – that the right to bargain collectively was protected by ECHR, Art 11.8 If Art 12 of the EU Charter is to be read consistently with the ECHR, Art 11, and if the ECHR, Art 11 is to be read consistently with ILO Convention 98, the implications are as enormous as they are obvious. It is true that Art 28 of the EU Charter of Fundamental Rights provides for ‘the right to negotiate and conclude collective agreements at the appropriate level’, and that this applies only ‘in accordance with Community law and national laws and practices’. In my view, however, this provision has been rendered largely – if not wholly – redundant by Demir and Baycara, to the extent that the latter now expands Art 12 of the Charter to include collective bargaining. The right to bargain collectively is thus now separately recognized by the latter, but without the qualification in Art 28.9 Following the report of the ILO High Level Mission in 2011 and the ILO Committee of Experts in 2012, it is thus strongly arguable the austerity plan for Greece is utterly illegal for its failure to respect the requirements of Art 12 of the EU Charter. There are additional issues to explore under the EU Charter of Fundamental Rights (Art 23), which provides unequivocally that ‘Equality between men 7 Kahn Freund, O., The Weimar Constitution, 1944, 15 Pol Q 229. 8 The ECtHR in Demir and Baycara appeared to pay more respect to the Charter than did the ECJ in the corresponding decisions in Viking and Laval. 9 In any event, to the extent that Art 28 provides a right to bargain collectively in accordance with ‘Community law’, the afore-mentioned Community law must surely include Art 12 of the Treaty, which by virtue of Art 52(3) must also include the right to bargain collectively. Importance of ILO and ECHR for the Development of EU Labour Law 367 and women must be ensured in all areas, including employment, work and pay’. It is clear from the report of the HLM that this is obligation was not respected. Conclusion Having regard to the ILO High Level Mission Report of 2011 and the ILO Committee of Experts Report of 2012, there were (and there may continue to be) two possible challenges to the austerity measures in Greece. One is against the Greek government itself for failing to comply with its obligations under the ECHR, Art 11; and the other is against the European Commission and the European Central Bank for failing to comply with their obligations under TEU, Arts 2, 3 and 6, insofar as Art 6 is addressed to the EU Charter of Fundamental Rights. There appears to be a breach of Arts 12 and 23 of the Charter. It is a matter of regret that in the litigation before the Greek Constitutional Court the opportunity was not taken to contrive or secure a reference to the CJEU. If, however, the domestic proceedings are successful and the Greek Constitutional Court upholds the constitutional rights of the people of Greece, CJEU involvement in this matter may well be inevitable, and with it the opportunity to challenge the legality of the conduct of the Commission and the Bank, if not the IMF.10 If, on the other hand, the domestic proceedings are unsuccessful, the road will be open for a full-blown assault on Strasbourg. The importance of this matter being addressed by the CJEU cannot be exaggerated: not only would it enable the legality of the conduct of the EU institutions to be challenged, but it would do so in a way that would require the CJEU to revisit Viking and Laval in the light of Demir and its progeny. Although it is impossible to predict how the Luxembourg court would respond, it is to be hoped that it is a task that would be undertaken with some humility, in the full knowledge that if it does not fully rise to the challenge of respecting the human rights of workers, the CJEU will indirectly be called to account by a higher legal authority, sitting in Strasbourg. V. 10 It would then be for the CJEU to determine in the light of Case C – 370/12, Pringle [2012] ECR 1-0000 whether or not the EU institutions and the Greek government were bound by EU law – and if so to what extent – when negotiating and implementing memorandums of understanding. 368 K. D. Ewing Workers’ involvement rights in transnational issues Teun Jaspers Introduction Globalisation is the key-word when we talk about changes of the system of industrial relations in the world.1 It also influences the decisions of multinational enterprises (MNEs) since they have to cope with the intensified competition between enterprises and between national economies. Part of that is the competition between social economic systems of countries or groups of countries, such as the European Union. In an increasing number MNEs are taking decisions that have a cross-border, a transnational impact. Strategic decisions have to be taken and economic efficiency counts. A big and interesting question is what about the effective influence of workers’ representatives on these transnational decisions and how relates that to national workers’ involvement. It is a two tier question: do transnational workers’ representing bodies effectively have an influence on the decision making of the central management of MNEs with a cross-border impact and on the other hand how does that fit in structures of national workers’ involvement on plant level since the strategic MNE decisions affect the plants in the various countries where they are located. It is a two sided question: 1. when do we speak of transnational issues and 2. what is the relation between the international and the national level and is there a sort of hierarchy between the two levels. Both questions are equally important but space is lacking to deal with both fully. Some observations It is important to note that the target of the workers’ organisation seems to have shifted from the improvement of the working conditions for the workers in the broad sense into a defensive strategy in order to try to preserve as far as possible the position of the workers.2 The power of the workers’ organisations, and I am I. II. 1 Cf. Craig, J./ Lynk, S. (eds.), Globalization and the Future of Labour Law, Cambridge, 2010. 2 Cf. Glassner, V./ Keune, M., Negotiating the crisis? Collective bargaining in Europe during the economic downturn, Working Paper No. 10, ILO, Geneva 2010.

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Die wachsende Bedeutung des internationalen Arbeitsrechts schlägt sich in vielen Bereichen nieder: Tarifautonomie und Streikrecht werden durch die Rechtsprechung des EGMR mitbestimmt, die ILO-Übereinkommen stellen einen Mindeststandard dar, der auch in einer Wirtschaftskrise nicht unterschritten werden darf. Nicht jeder nationale Gesetzgeber und nicht jedes Gericht hat dies aber bisher erkannt. Von daher ergeben sich viele Kontroversen, in Deutschland u. a. bei der Kündigung kirchlicher Mitarbeiter und bei der überlangen Dauer gerichtlicher Verfahren deutlich werden.

Die insgesamt 35 Autoren sind in der Wissenschaft, aber auch in internationalen Organisationen, in Ministerien und als Richter tätig. Der Band verbindet Theorie und Praxis; als Leser bekommt man nicht nur Stoff zum Nachdenken, sondern nicht selten auch ganz konkrete Handlungsanleitungen. Bislang gibt es kein vergleichbares Buch in der rechtswissenschaftlichen Literatur.