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ABSTRACT
In recent years, the European Court of Justice (ECJ) has extended the scope of the four fundamental freedoms to politically and economically highly sensitive areas such as the right to strike and the regulation of working conditions of posted workers. This article analyses the domestic impact of two of the most controversial judgments – Laval (C-341/05) and Rüffert (C-346/06) – in Denmark, Sweden and Germany. In order to explain the different outcomes of the national adaptation processes, the article connects the literature on judicial Europeanization with political economy perspectives on the role of employers in economic and social regulation. The findings show that the differences between the cases can be traced back to different preferences of employers towards wage competition. The reason for this is that the ECJ's case law has shifted the balance of power between labour and capital in the domestic arenas in favour of business.
ACKNOWLEDGEMENTS
I would like to thank the German Research Foundation for its funding of the Collaborative Research Center 597 ‘Transformations of the State'. I thank Karen Anderson, Nils Böhlke, Clara Bückert, Martin Höpner, Heike Klüver, Thorsten Schulten, Martin Seeliger, Sebastian Streb and Ines Wagner for helpful comments and suggestions. I am especially grateful to Martin Behrens, Michael Blauberger, Henning Deters, Tilman Krüger, Detlef Sack and Susanne K. Schmidt for commenting on earlier versions of this article. In addition, I would like to thank the two anonymous reviewers for their constructive comments. Merete Schultze and Christoph Wieboldt have provided valuable research assistance.
Notes
1 ‘Preferences of employers' refers to the position of business associations. Interests of employers are not necessarily homogenous and conflicts are possible.
2 Still, there are exceptions from this general trend. For example, in Lower-Saxony, a CDU–FDP government introduced Tariftreue before Rüffert and Schleswig-Holstein did not abolish social clauses after the FDP came into office.
3 Government composition was taken from ParlGov Database (Döring and Manow Citation2012).
4 Interview Danish Trade Union Confederation (LO).
5 Interviews Construction Workers Union (BAT-Kartellet) and DA.
6 In the year of the Laval conflict, Byggnads took industrial action against nine foreign companies. Notifications of industrial action were issued more often.
7 Interview Swedish Confederation of Professional Employees (TCO). Trade unions can challenge the accuracy of such a statement legally, but companies can use it as an interim measure until they have left the country.
8 Interview TCO.
9 Information from Dansk Byggeri, annual reports of Danish construction companies, Sveriges Byggindustrier and Hauptverband der deutschen Bauindustrie.
10 In Denmark, the five biggest companies only have two of the 12 board seats.
11 Interviews BI and TCO.
12 For an overview, see http://www.boeckler.de/index_tariftreue.htm (accessed 12 May 2014). Minimum wages vary between €8.00 and €9.18.
13 http://www.boeckler.de/pdf/p_ta_tarife_bauhauptgewerbe_2013.pdf (accessed 15 May 2014).
14 Interview HDB.
15 This might explain why partisan effects were stronger in Germany than in the other cases.
16 Interview Ministry of Economy, Technology and Research of Berlin.
17 Whilst they criticized procurement-specific minimum wages because it would restrict the autonomy of social partners.
18 Employers have to calculate the trade-off between benefits of liberalization and costs of conflict with unions. Furthermore, they might agree to regulation in order to pre-empt political interventions (Afonso Citation2011: 713–14).
Additional information
Daniel Seikel is a researcher at the Institute of Economic and Social Research (WSI) of the Hans Böckler Foundation in Düsseldorf.