Last Updated on June 13, 2021 by LawEuro
Information Note on the Court’s case-law 252
June 2021
Norwegian Confederation of Trade Unions (LO) and Norwegian Transport Workers’ Union (NTF) v. Norway – 45487/17
Judgment 10.6.2021 [Section V]
Article 11
Article 11-1
Freedom of association
Well-founded decision to declare unlawful announced trade union boycott to pressure foreign company into collective agreement in breach of EEA freedom of establishment : no violation
Facts – Norway is a member of the European Free Trade Association (EFTA) and of the European Economic Area (EEA). The applicant trade unions, NTF and LO, entered into a collective framework agreement with the Confederation of Norwegian Enterprise (NHO), the largest employer organisation in Norway, and the Norwegian Logistics and Freight Association (NHO logistikk og transport), in respect of a fixed pay scheme for dockworkers at many of Norway’s major ports, including the port of Drammen. Among other things, the Framework Agreement established an Administration Office for Docks Work in Drammen and all permanently employed dockworkers in the port were employed by the Office.
Holship Norge AS was a Norwegian subsidiary of a Danish freight forwarding company. It was not a member of NHO or NHO logistikk og transport. In 2013, Holship employed four persons in the port who, inter alia, carried out loading and unloading operations for their employer.
Subsequently, NTF demanded that a collective agreement be entered into and that Holship accept the Framework Agreement. Holship did not agree. The NTF sent a letter with a notice of boycott and successfully sought an advance declaratory judgment that the announced boycott would not be unlawful from the domestic courts. Holship appealed up to the Supreme Court, which applied for an advisory opinion by the Court of Justice of the European Free Trade Association (the EFTA Court). The Supreme Court ruled that the boycott would be unlawful.
Law – Article 11: (a) Applicability
The Court had not previously rendered judgments relating to an action fully resembling the one at issue in the instant case. The collective action had essentially been a boycott in the form of a blockade organised by NTF in order to pressure Holship to enter into a collective agreement containing a priority clause for registered dockworkers employed in the Administration Office.
The Court had previously held that it would be inconsistent with the method of interpretation outlined in Demir and Baykara v. Turkey ([GC] 34503/97, 12 November 2008) for it to adopt an interpretation of the scope of freedom of association of trade unions that was much narrower than that which prevailed in international law (National Union of Rail, Maritime and Transport Workers v. the United Kingdom 31045/10, 8 April 2014). Given that a blockade could lead to Article 11 being deemed applicable in relation to the negative freedom of association of an applicant business or employer (Gustafsson v. Sweden 15573/89, 25 April 1996), it followed that the exercise of a blockade by an applicant trade union could also give rise to the applicability of Article 11. Moreover, the Court of Justice of the European Union (CJEU) had recognised that the right to collective action constituted a fundamental right under EU, in a case also involving a blockade (Laval un Partneri, C-341/05, 18 December 2007).
With regard to the purpose of the proposed action, the impugned boycott had aimed inter alia to ensure stable and safe working conditions for dockworkers. Furthermore, the priority right, which was one of the rights the proposed boycott had sought to defend, was based on a long-standing tradition domestically, and provided for in international law.
In the light of the above, the impugned boycott, which the applicant unions had notified in advance in accordance with domestic law, was capable of falling within the scope of Article 11 § 1.
(b) Merits
The Supreme Court’s judgment finding the intended boycott unlawful had entailed a “restriction” on the exercise of the trade unions’ rights which was prescribed by law and aimed to protect the “rights and freedoms” of others, in particular Holship’s right to freedom of establishment as guaranteed by the EEA Agreement. The Court then addressed two preliminary issues:
(i) Holship’s “negative freedom of association”
First, it had not been established that the impugned boycott would have contravened Holship’s right to “negative freedom of association”. That being the case, the examination in the instant case had to focus on the necessity of the restriction under Article 11 § 2.
(ii) Applicability of the Bosphorus presumption to EEA law
The second issue concerned the possible existence and application of the presumption of equivalent protection (Bosphorus v. Ireland). In Konkurrenten.no AS v. Norway, the Court had stated that the basis for the Bosphorus presumption was in principle lacking when it came to the implementation of EEA law at domestic level within the framework of the EEA Agreement, due to the specificities of the governing treaties compared to those of the European Union. Two distinct features had been specifically highlighted: the lack of direct effect and supremacy in the framework of the EEA Agreement itself, and the fact that the EEA agreement did not include the EU Charter of Fundamental Rights, or any reference whatsoever to other legal instruments having the same effect, such as the Convention.
Regarding that latter feature, however, the Court observed, as clearly stated by the EFTA court in its advisory opinion, that fundamental rights formed part of the unwritten principles of EEA law. Since that reflected the position which had previously pertained under EU law, prior to successive EU Treaty amendments, according to which fundamental rights had first been recognised as general principles of EU law, the fact that the EEA agreement did not include the EU Charter was not determinative of the question whether the Bosphorus presumption could apply when it came to the implementation of EEA law, or certain parts thereof.
However, given the former feature of EEA law identified by the Court in Konkurrenten.no, added to which was the absence of the binding legal effect of advisory opinions from the EFTA Court, and given that the existence of procedural mechanisms for ensuring the protection of substantive fundamental rights guarantees was one of the two conditions for the application of the Bosphorus presumption, the Court left it to another case, where questions in relation to the procedural mechanisms under EEA law might arise, to review that issue. For the purposes of this case, the Court proceeded on the basis that the Bosphorus presumption did not apply to EEA law. It was therefore required to determine whether the restriction had been necessary for the purposes of Article 11.
(iii) The necessity of the restriction
The Court emphasised that a majority of the Supreme Court had found that the Framework Agreement and its system involving priority for registered dockworkers had had little to do with the protection of workers. The collective agreement demanded by NTF had been “irregular”, and the protection it had afforded to members’ interests in working and pay conditions had been “relatively indirect”. The Administration Office had been a company engaged in “business activities in a market” – the market of unloading and loading activities – to which other operators had wanted access, and as regards the announced boycott, its “primary effect” would have been to deny Holship access to that market, which it had wished to enter. That characterisation of the boycott was central to the Supreme Court’s finding that a fair balance had, in the particular circumstances of that case, been struck.
As regards the balancing exercise undertaken by the Supreme Court, it was clear that it had engaged in an extensive assessment of the conflicting fundamental right to collective action relied on by the applicant unions and the fundamental economic freedom under EEA law on which the employer had relied. It had indicated that the boycott had, among other things, to be reconciled with the rights that followed from the EEA Agreement and that in consideration of proportionality, a fair balance had to be struck between those rights. Given the characteristics of the collective action, the breadth of the margin of appreciation in the present case was clearly wide.
Following the Supreme Court judgment, the relevant social partners had negotiated and concluded a new collective agreement: the restriction of the applicant unions’ Article 11 rights had not as such prevented them from engaging in further collective bargaining. Against that background, the Court did not consider that sufficiently “strong reasons” existed for it to substitute its views for that of the Supreme Court in this case.
Nevertheless, it was necessary to note, firstly, that for a collective action to achieve its aim, it might have to interfere with internal market freedoms such as those at issue in the case before the Supreme Court. The degree to which a collective action risked having economic consequences could not, therefore, in and of itself be a decisive consideration in the analysis of proportionality under Article 11 § 2 (see Ognevenko v. Russia, 44873/09, 20 November 2018). Even when implementing their obligations under EU or EEA law, Contracting Parties had to ensure that restrictions imposed on Article 11 rights did not affect the essential elements of trade union freedom, without which that freedom would become devoid of substance. Secondly, there was a risk that a domestic court, which found itself in a position such as that in which the Supreme Court had found itself in the present case, might balance a right under the Convention against a right under the EEA Agreement in a manner that would generally only be appropriate had the issue before it been a matter of conflicting fundamental rights under the Convention. From the perspective of Article 11, the EEA freedom of establishment was not a counterbalancing fundamental right to freedom of association but rather one element, albeit an important one, to be taken into consideration in the assessment of proportionality under Article 11 § 2.
However, in the particular circumstances of this case, the Supreme Court had advanced relevant and sufficient grounds to justify its final conclusion.
Conclusion: no violation (unanimously).
(See also Bosphorus Hava Yolları Turizm ve Ticaret Anonim Şirketi v. Ireland [GC] 45036/98, 30 June 2005, Legal Summary; Konkurrenten.no AS v. Norway (dec.) 47341/15, 5 November 2019, Legal Summary)
Leave a Reply