In November 2004, the Swedish building workers’ union Byggnads picketed construction work at a school in Vaxholm, near Stockholm. A subsidiary of the Latvian company Laval had won the contract from the local authority and seconded Latvian workers who, while union members, were being paid a fraction of the standard wage negotiated by Byggnads for the sector. Supported by the Swedish labour movement as a whole, the union blockade eventually forced the company to concede defeat, and the contract was awarded to a company adhering to wage levels established in the collective agreement.
The dispute moved from the picket line to the political arena when the Latvian government claimed that Sweden was violating EU rules on the free movement of services and the company sued the union in the Swedish Labour Court. EU Internal Market Commissioner Charlie McCreevey escalated the conflict by denouncing the Swedish action as an intolerable assault on the single market. McCreevey’s intervention effectively split the European Commission into two camps, reflecting the opposition of European (including the Swedish and Latvian) employers, on the one hand, insisting on the primacy of the single market over national collective agreements, and the European trade union movement, on the other, defending the compatibility of national wage bargaining with the EU-wide mobility of capital, labour and services.
The Labour Court, reversing its earlier ruling in favour of the union, referred the case to the European Court of Justice. The Court’s Advocate General has now issued his recommendation to the Court, whose decisions generally follow the Advocate’s recommendations (the final European Court decision is not expected until the end of 2007 at the earliest, at which time the Labour Court is also expected to issue its final decision). According to the recommendation, Byggnads’ industrial action was in conformity with EU law: unions can take action to impose a collective agreement on temporary workers from another member state ‘if the collective action is motivated by public-interest objectives, such as the protection of workers and the fight against social dumping’.
The union victory, however, is not unqualified. There is a potential poison pill in the recommendation, which stated that action must not be ‘disproportionate’ to the objective. The Swedish employers and their European allies will no doubt seek to argue that that the Byggnads action was in fact ‘disproportionate’ − the employers’ association in Sweden has been campaigning hard against ‘disproportionate’ industrial action, including secondary (solidarity) action, in their efforts to roll back strong national agreements.
The struggle concerns more than Swedish or Latvian workers. The unprecedented mobility of capital globally and in the European Union − symbolized by the forward march of private equity and hedge funds which collectively dwarf the national economies of many EU member states − has been a sledgehammer force undermining the protection of workers and the global public interest. Firmly anchoring in EU law the right of trade unions to take industrial action, including solidarity action by workers not directly involved in a collective bargaining dispute, would give judicial force to an essential act of social self defence. The Vaxholm case should be the signal to move to the top of the European and global trade union agenda a campaign to legalize solidarity action within and across national frontiers.
