Objections cause EU Commission to reconsider controversial strike proposal

In our March labour law update we reported on the Commission's newly published proposal for a Regulation on industrial action. The draft Regulation is a response to a number of judgments by the European Court of Justice, notably in the Viking and Laval cases. These cases concern cross-border collective action which had the effect of restricting the exercise of economic freedoms (for example, a business's freedom of establishment) guaranteed by the EU Treaties. In both cases, the Court clarified that the right to strike may, in principle, restrict the exercise of economic freedoms if it pursued a legitimate objective, is justified and does not go beyond what is necessary to achieve the objective.

Reflecting ongoing trade union concerns that this case law hampered their ability to take collective action, the draft Regulation represented the Commission's attempt to reduce tensions and clarify the status quo. However, twelve member states have now formally registered their objections on the grounds that it breaches the principle of subsidiarity (meaning that the EU should only act if it is more effective than action taken at national, regional or local level). Amongst those objecting are the UK Parliament which states that "the Commission has failed to adduce clear evidence of necessity for EU legislative action, which should include how it will achieve its stated objectives."  The Commission must now review its proposal and to decide whether to maintain, amend or withdraw it, giving reasons for its decision.

Trade unionist elected to head International Labour Organisation (ILO)

Guy Ryder has been elected as the tenth Director-General of the ILO and will begin his five-year term in October 2012. Born in Liverpool, Mr Ryder has spent most of his career working for international trade union federations, including the International Confederation of Free Trade Unions (ICFTU) and as General Secretary of the International Trade Union Confederation (ITUC). Since 2010, Mr Ryder has worked for the ILO as Executive Director responsible for International Labour Standards and Fundamental Principles and Rights at Work.

He will play a key role in influencing the future direction of the ILO, the United Nations' tripartite body linking governments, unions and employers, which sets the standards for labour and employment practices around the globe. In particular, attention will focus on whether he brings a pro-worker agenda to his leadership.

While ILO Conventions and standards are aimed at ILO member states, its labour standards are also relevant to global businesses because trade unions and other organisations "name and shame" individual companies when taking complaints to the ILO. In addition, the growth of trans-national agreements (also known as international framework agreements or IFAs) between trade unions and multi-national employers - which typically require businesses to uphold ILO standards - has resulted in increasing pressure on multinationals to abide by them. For further information on the changing state of global labour relations, in particular the ILO standards, the rise in global trade unions, IFAs and how employers should respond, please read our summary briefing.

Changing the jurisdiction of an EWC: Visteon in court

A significant European works council (EWC) case is currently before the German courts. At the heart of the issue is the question of whether an EWC can change its jurisdiction, from Germany to the UK, where European management has moved from one country to the other. The company involved, Visteon, is a US company and had previously designated Germany as its representative agent for EWC purposes. The court rejected the complaint brought by the EWC and, depending on its reasoning and any appeal, this will have implications for other employers: for example, where an employer's EWC is currently in a jurisdiction which applies stricter sanctions, when compared to other EU jurisdictions, for breaching an EWC. We will update readers when further details are available.

IndustriALL, a new global union, is launched

On 19 June, delegates representing 50 million workers in 140 countries met to establish a new global union federation for the mining, energy and manufacturing sectors. The new union, called IndustriALL, is a merger of the International Federation of Chemical, Energy, Mine and General Workers' Unions, the International Metalworkers' Federation and the International Textile, Garment and Leather Workers' Federation. Representing workers employed by multinational corporations, it will seek to "challenge the power of multinational companies"  and to "fight for a new model of globalisation, a new economic and social model that puts people first". This merger reflects an ongoing trend for unions and their federations to join together to campaign and cooperate across borders to gain traction in multinationals, for example, pressurising US operations to match European-style collective rights where an employer operates on both continents or campaigning for worker rights in the supply chains of multinationals.