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Social dumping again before the Court

(B2) The application of the “posting of workers” directive and social dumping continue to make waves at the EC Court of Justice. After business Viking/Laval et Germany, here is a new general counsel, the Frenchman Yves Bot (classified Chiraquien) who intends to change the case law on the minimum wage for posted workers, in a more social sense.

The collective agreement applicable even if it is not of general application
In conclusions delivered on September 20, the Advocate General considers, in fact, that legislation (like that existing in the Land of Lower Saxony), which requires beneficiaries of public contracts, or their subcontractors, to pay to posted workers, the remuneration provided for in the collective agreement, even if it is not declared to be of general application, is in accordance with European law (freedom to provide services). The only reservation: “It is the responsibility of the referring court to verify that this legislation does indeed provide, for posted workers, a real advantage which contributes, significantly, to their social protection, and that, in the implementation of said legislation , the principle of transparency of the conditions of execution of the public contract concerned is respected.” (case Rüffert / Land Niedersachsen, C-346/06)

Facts: A Polish company only paid half the minimum wage
The Land of Lower Saxony (Niedersachsen) had concluded a public contract for the construction of the Göttingen-Rosdorf penitentiary establishment with a German company which called on a Polish subcontractor (PKZ Pracownie Konserwacji Zabytkow), established in Tarnow. But during the summer of 2004, the PKZ company was suspected of having employed Polish workers on the construction site at a salary lower than that provided for in the applicable collective agreement. It would have paid the 53 workers working on the site, according to documents produced to the Court of Justice, only 46,5% of the planned minimum wage. His contract was therefore terminated, in accordance with Land law which provides for financial penalties, or even termination without notice in the event of serious misconduct (in particular respect for social laws).

Ten governments in battle
It should be noted that seven governments (German, Danish, Irish, Cypriot, Austrian, Finnish and Norwegian *) intervened in the case to support the Land's legislation and ensure that this restriction was justified and proportionate. The Belgian government was more mixed, believing that this restriction could be justified, but it still had to be proven that it was proportionate.
On the other hand, the Polish government intervened in support of its company, considering that the directive on posting does not require the payment of a salary higher than the obligatory minimum rate. Substantially similar opinion for the European Commission, and… the French government, who maintained that only collective agreements declared to be of general application in Germany are applicable to posted workers. The Commission thus considered that the Land law was contrary to Article 49 of the Treaty on the freedom to provide services.

The general advocate for the application of the maximum minimum wage
The magistrate considers in fact that if Directive 96/71 provides for a “hard core” of protective rules including the minimum wage rate “…set in the field of construction by collective agreements (…) declared to be of general application” , this rule must be interpreted taking into account another provision (article 3 § 7 and 17th recital of the directive) which establishes that “the mandatory rules of minimum protection in force in the host country must not prevent the application working and employment conditions more favorable to workers”.

The State can put in place reinforced national protection
The European magistrate thus considers that “the imperative nature of the protective rules in force in the State of the place of performance of the service may be eclipsed in favor of (these) rules more favorable for posted workers”. The Member States of the place of performance of the service can “improve the level of social protection which they wish to guarantee to workers employed on their territory and which they can therefore apply to workers posted there”.
For the Advocate General, in Germany there is clearly the mark of this “reinforced national protection” in the construction sector. The collective agreement applicable to construction (TV Mindestlohn) clearly specifies “that the rights to higher wages under other collective agreements or under special agreements are not affected by the provision providing for the overall conventional hourly wages of two categories (concerned)”.

Context elements

In Germany, the determination of the minimum wage in the construction sector is a matter of collective bargaining. The collective agreement of July 4, 2002, which sets a general framework for the construction industry (Bundesrahmentarifvertrag für das Baugewerbe), and is applicable throughout the territory of the FRG, does not contain rules relating to the minimum wage. These are contained, on the one hand, in a collective agreement providing for a minimum wage in the construction sector in the territory of the FRG (Tarifvertrag zur Regelung der Mindestlöhne im Baugewerbe im Gebiet der Bundesrepublik Deutschland, called “TV Mindestlohn”). , declared of general application, and specific collective agreements. There "
;Tarifvertrag zur Regelung der Löhne und Ausbildungsvergütungen” of 2003 applicable in the Land of Niedersachsen sets a higher tariff but is not declared to be of general application.

The law on public procurement applicable in Lower Saxony provides that “contracting authorities have the right to designate as successful bidders for construction and local public transport contracts only companies paying the salaries fixed in collective agreements instead of execution of the provision of services”. Its article 3, § 1 states that “works contracts are only awarded to companies which, upon submission, undertake in writing to pay their employees, in return for the execution of the services concerned, at least the remuneration provided for in the collective agreement applicable to the place of performance of said services, at the time provided for therein”.


* EEA member states can also intervene in certain matters.

Nicolas Gros Verheyde

Chief editor of the B2 site. Graduated in European law from the University of Paris I Pantheon Sorbonne and listener to the 65th session of the IHEDN (Institut des Hautes Etudes de la Défense Nationale. Journalist since 1989, founded B2 - Bruxelles2 in 2008. EU/NATO correspondent in Brussels for Sud-Ouest (previously West-France and France-Soir).