Vaxholm/Laval case: its implementations for trade unions
| Pages | 473-478 |
| Date | 15 August 2008 |
| DOI | https://doi.org/10.1108/01425450810888259 |
| Published date | 15 August 2008 |
| Author | John Gennard |
| Subject Matter | HR & organizational behaviour |
EDITORIAL
Vaxholm/Laval case: its
implementations for trade unions
John Gennard
Department of HRM, University of Strathclyde, Glasgow, UK
Abstract
Purpose – The purpose of this editorial is to examine the implementations of the European Court of
Justice (ECJ) ruling in December 2007 on the Laval case in Sweden for trade unions.
Design/methodology/approach – The editorial outlines the ECJ decision and then examines the
response of the European Trade Union Confederation and the social partners and governments in
Sweden and Denmark.
Findings – The ECJ upholds in European Union (EU) law the right to strike as a fundamental right
and the right of a union to undertake industrial action against wage dumping. The judgement,
however, restraints these rights to ensuring that foreign service providers are complying with the
minimum employment standards as laid down in the host country legislation. Trade unions in the host
county cannot undertake industrial action to force a foreign service provider to provide better terms
and conditions of employment than that provided by the laws of the host country. The judgement
implies that trade unions cannot in host countries by means of collective action, demand more than the
legal minimum rate of pay from a company coming from a different EU member state.
Originality/value – The editorial offers insights into EU law and its implementations for preventing
wage dumping between EU member states.
Keywords Sweden, Industrial law, European law , Industrial relations
Paper type Viewpoint
The Vaxholm/Laval case raised questions about whether European Union (EU) law
can restrict trade unions in one member state from taking industrial action or if it can
restrict the application of collective agreements in a host member state. The case raised
the fundamental question of how EU law deals with issues of fundamental, but
conflicting freedoms in situations where one such freedom may be limited by anothe r
or where the exercise of one freedom may limit the right to exercise another. The
outcome of the case was regarded in Sweden as being critical for the future of the
country’s collective bargaining based industrial relations model in the face of the basic
principles of free movement of capital, goods, labour and services in the enlarged EU.
Background to the case
In May 2004, the city of Vaxholm (to the north east of Stockholm) awarded a contract to
carry out refurbishment and repair work at a school to Lavlun to Partneri, a Latvian
headquartered company. The contract was awarded through Laval’s wholly owned
subsidiary LEP Baltic. Latvia started to carry out the work at the school using 14
employees temporarily posted to Sweden from Latvia and being paid some 40 per cent
less than their Swedish counterparts. There was concern that the po sting of cheaper
labour to Sweden would threaten the position of Swedish construction workers. In June
2004, the Stockholm branch of the Swedish Building Worker’s Union approached the
The current issue and full text archive of this journal is available at
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Editorial
473
Employee Relations
Vol. 30 No. 5, 2008
pp. 473-478
qEmerald Group Publishing Limited
0142-5455
DOI 10.1108/01425450810888259
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