EU High Court Upholds Stronger Protections for Cross-Border Workers

Vehicles queue at the border crossing in Krusaa, Denmark, on June 15. (Claus Fisker/Ritzau Scanpix via AP)

LUXEMBOURG (CN) — Rejecting protests from Hungary and Poland, the European Union’s top court ruled Tuesday that the bloc can tighten rules governing workers sent outside their home countries.

The European Court of Justice held in a pair of rulings that EU lawmakers had the legal authority to update regulations covering so-called posted workers, those temporarily sent abroad by their employer, to give them more legal protections. 

“More than 20 years after its adoption, it is necessary to assess whether [the Posting of Workers Directive] still strikes the right balance between, on the one hand, the need to promote the freedom to provide services and to ensure a level playing field, and, on the other, the need to protect the rights of posted workers,” the Luxembourg-based court wrote. 

The 2018 update to the 1996 regulation requires companies that send workers to another EU country to follow that country’s rules on such matters as minimum wages, maximum working hours, the equal treatment of men and women, and health standards. For example, a Polish worker employed in Poland but sent to Germany for work would need to be paid the German minimum wage rather than the Polish one.

Additionally, travel and accommodation must be paid by the employer and not deducted from the salary of the employee and contracts for cross-border work are limited to a maximum of 18 months. 

Eastern European countries were deeply resistant to the changes, as most of the workers impacted come from countries like Hungary and Poland. Countries like Germany and France, where most of the workers are sent, complained that these workers drive down wages and erode worker protections on their soil.  

It took 27 months for the European Parliament to pass the hotly contested update, but just three months later Hungary and Poland filed a complaint with the Court of Justice challenging the stricter rules. They argued the 27-member political and economic union did not have the legal authority to make the changes. 

The EU’s high court disagreed Tuesday, dismissing both countries’ complaints in full.

“In the light of the objective that was pursued by [the Posting of Workers Directive], namely to ensure the freedom to provide transnational services within the internal market in conditions of fair competition and to guarantee respect for the rights of workers, the EU legislature could…when adopting the contested directive, rely on the same legal basis,” the 15-judge panel wrote.

Hungary and Poland argued the new rules impose requirements for wage and other working conditions beyond what the EU is permitted to regulate and deprived them of a competitive advantage, but that argument failed as well.

“The directive provides that posted workers are to be entitled to a set of terms and conditions of employment in the host member state, including the constituent elements of remuneration rendered mandatory in that member state,” the rulings state. “That directive does not, therefore, have any effect on the other cost components of the undertakings which post such workers, such as the productivity or efficiency of those workers.”

Tuesday’s decision, which cannot be appealed, was not surprising. In May, a magistrate for the court wrote an advisory opinion siding with the EU over Hungary and Poland. While such opinions are nonbinding, the court follows the legal reasoning of its advisers in about 80% of cases. 

Earlier this month, the court also found in favor of workers in another case involving Hungary. A Dutch transportation company hired truck drivers in Germany and Hungary and their work contracts were aligned with German and Hungarian law. A Dutch trade union sued, arguing the drivers counted as posted workers, and the Court of Justice agreed. Before that, it was unclear if truck drivers could be classified as posted workers.

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