No 1/2015. CLR News. Wages and employment, disintegration or transformation CLR. European Institute for Construction Labour Research.

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1 No 1/2015 CLR News Wages and employment, disintegration or transformation CLR European Institute for Construction Labour Research

3 Contents Note from the Editor 4 Subject articles 7 Jörn Janssen: Instead of an introduction: the transformation of employment in construction. 7 Phillip Toner, Mike Rafferty: Financialisation of the construction industry and collective bargaining. 12 Ernst-Ludwig Laux: Statutory minimum wage in Germany. 23 Thorsten Schulten: On the expansion of minimum wages in Europe. 31 Hans Baumann, Andreas Rieger: The struggle for Swiss minimum wages goes on. 37 Discussion: 41 Vasco Pedrina: Equal rights and wages for migrant workers: the example of the battles in Switzerland. 41 Reports: 54 Holcim-Lafarge merger. (Rolf Beyeler) 54 Social identity cards in the European construction industry. (Werner Buelen) 55 Employment law after the elections in Great Britain. IER 11/02/ (Jörn Janssen) 56 Building with 3-D printers in Amsterdam. (Ernst-Ludwig Laux) 57 Reviews: 58 Olivier Fahrni (2014) Heavy metal. (Hans Baumann) 58 Jeremy Rifkin (2014) The zero marginal cost society: the Internet of things, the collaborative (Ernst-Ludwig Laux) 60 ILO Wage Report 2015/15. (Hans Baumann) 61 New Projects: 64 University of Westminster: Thames Tideway, Women in Construction. 64 York University of Toronto and University of Westminster: Climate change and work. 65 Events: 68 CLR AGM and Seminar. 68 CLR News 1/2015 3

4 Note from the editor Jan Cremers, In this editorial I have to talk about a topical issue related to a ruling of the European Court of Justice. In my editorial I wrote: The basic principle of the European social model as formulated by the founders of the European Economic Community was the respect for the well-balanced regulatory framework for social policy, including social security and labour standards that existed in the member states. I added that this was also the guiding principle for the rules that were formulated in the Posting of Workers Directive (PWD). But, already in our 2004 book The free movement of workers in the European Union (CLR-Studies 4 by Cremers & Donders) we had to conclude that the possibility to verify, legally and in practice, whether a worker was correctly posted and fell under the scope of the PWD was one of the Achilles' heels of the enforcement of the correct use of cross-border recruited labour in the frame of the provision of services. The competence to decide about liability in cases of fake selfemployment and/or fake posting was blurred by ECJrulings about home versus host country responsibilities. The ECJ tended to describe mandatory basic control in a host country as a barrier for the free provision of services. Along the same lines, and again referring to the primacy of economic freedom, the competence to define who was deemed to be the real and genuine employer and who could be held liable in cases of fake posting by letterbox companies was located by the ECJ with the (often nonexisting) home country of these establishments. Thus, the correlation with economic freedom, notably the freedom of establishment and the free provision of services, obstructed fundamental legal and political solutions. As mentioned before, after the launch of the Internal Market project, the Commission and the ECJ, not hindered by EU member states, often gave primacy to the free provision of services over the lex loci laboris principles of the posting rules. It took quite some time before the member states 4 CLR News 1/2015

5 Note from the editor reacted; even those member states envisaged by the different ECJ-cases refrained from pushing forward the problems in the EPSCO Council that brings together ministers responsible for employment, social affairs, health and consumer policy from all EU member states. In this Council - in fact the principal legislator - the advocates of a liberalised labour market characterised by deliberate competition in the field of working conditions and pay clashed with representatives from countries that were in favour of the creation of a level-playing-field based on the existing national regulatory framework (the Rhineland or social model). The main driver for change was the European Parliament, which forced the EC president Barroso during the debates for his second term to come up with the promise of an initiative for the enforcement of the PWD-principles. We will certainly come back to the resulting Enforcement Directive in the very near future and assess the enforcement principles formulated in that Directive. In recent months not only the European legislator but also the ECJ seem to have realised what negative effects blunt economic reasoning can have on the functioning of the PWD. In a Finnish case of Polish workers being underpaid (C-396/13), the ECJ underlines that the terms and conditions of employment guaranteed to posted workers are to be defined by the law of the host member state (as long as these conditions are declared universally applicable, binding and transparent ). In this case the foreign subcontractor contested that the trade unions in the host country had standing to bring proceedings to the court, given that the employment relationship was based on the law of the home country. Thus, the ECJ had to decide on the question of whether the right to an effective remedy, as laid down by the Charter of Fundamental Rights, of claims assigned by the PWD could be blocked by the rule of the home country (that prohibited the assignment of claims arising from the employment relationship). The ECJ ruled that the trade union in the host country was eligible, as its standing was governed by Finnish procedural law and as the PWD makes it clear that questions concerning minimum rates of pay are governed, whatever the law applicable to the employment relationship, by the law of the host country. This new issue of CLR-News does not focus on this item, but some of the contributions can be read from CLR News 1/2015 5

6 Note from the editor this perspective. The sub-editors Hans Baumann and Jörn Janssen have collected analyses of wage bargaining perspectives for the construction industry. The contributions range from two specific country reports on minimum wages to a broader European overview and two articles that examine the transformation of the building industries (in Europe and Australia). The included reports and reviews partially deal with the same subject, partially are taken on board for topical reasons. We trust that the issue will find resonance among our readers. BATTLE-SITES - A call for funding by Jakob Mathiassen The book Battle-sites (Kamppladser) was published in Denmark in March The book tells the story of the labour movement's struggle against social dumping in the Danish construction sector from 2004 to Accompanied by analyses and statistics, the book describes the most spectacular struggles that took place on six specific construction sites. We, the authors of Battle-sites are not impartial historians, but on the contrary, active participants in the struggles. I am a concrete worker and rank and file member of the trade union 3F, and I have been taking part in the struggle since My co-writer, Klaus Buster Jensen, is a journalist for 3F's trade journal, where he has exposed and reported on social dumping in Denmark's construction trade. Today, one year after the publication, we are trying to get the book translated into English and German. The goal in translating the book is, first and foremost, to share the Danish experience with the EU's eastern expansion and the struggle against social dumping. We hope that the Danish experience, successes and failures, will be useful to those involved in the fight against social dumping in other countries. Translating and publishing a book is an expensive project. So we have put the project on a crowed funding page. We hope that all interested parties together can finance the project. Support the translation directly on: Reed more about the book and the translation on: 6 CLR News 1/2015

No 1/2015. CLR News. Wages and employment, disintegration or transformation CLR. European Institute for Construction Labour Research.

No 1/2015. CLR News. Wages and employment, disintegration or transformation CLR. European Institute for Construction Labour Research. No 1/2015 CLR News Wages and employment, disintegration or transformation CLR European Institute for Construction Labour Research www.clr-news.org Contents Note from the Editor 4 Subject articles 7 Jörn