The EU is Dedicated to Privatisation and the Biggest Attack on Workers’ Rights for a Generation

A number of recent events have clarified the true nature of the European Union and probably shattered many illusions. At the end of last year, the European Commission adopted a draft health services directive designed to create a “market” in healthcare. This followed numerous judgments on the subject at the European Court of Justice. It constitutes a direct attack on the principles of the National Health Service.

The directive was introduced after healthcare was removed from the services directive, which is designed to remove all barriers in service provision and speed up the creation of an internal market within the EU.

Britain’s railways suffered a similar fate when they were privatised by the Tories according to EU Directive 91/440. This stipulated the separation of track and operations in order to create a “market”.

In early December, the European Court of Justice ruled in the Viking and Vaxholm cases that taking strike action was not, after all, a fundamental right under EU rules. Also in December, the renamed EU constitution was rubber-stamped to great fanfare in Portugal with the new title of the “Lisbon treaty”. EU leaders also adopted the curious word “flexicurity” as a concept.

Combined, these events represent the greatest threat to trade unionism, democracy and social progress since the Second World War. “Flexicurity” makes the false promise that, if workers embrace “flexibility”, job “security” will follow. Surely this is a contradiction in terms.

The architects of “flexicurity” consist of the European Commission and corporate lobbyists such as the European Round Table of industrialists. The concept is designed fatally undermine collective bargaining. It demands the abolition of “overtly protective terms and conditions” in contracts which supposedly “deter employers from hiring during economic upturns”. In plain language, this would mean an end to workers’ collective rights.

According to the EU: “Stringent employment protection tends to reduce the dynamism of the labour market.” So, presumably, without unions there would be a permanent economic boom. Unite joint general secretary Derek Simpson was right when he said that the concept of flexicurity “hides behind the language of equality to propose measures to force exploitation and insecurity on to every worker in Europe”

As the biggest trade union in Cyprus, PEO, recently declared, flexicurity represents “a very dangerous attempt to smash existing labour laws and gains”, increasing the trend towards “casual uninsured jobs”. PEO’s view is that: “The changes being sought are aimed in reality at easing labour protection rules, the abolition of full and steady employment as well as the marginalisation of collective agreements.”

An EU green paper promoting flexicurity said that contractor obligations to monitor employment law among sub-contractors “may serve to restrain sub-contracting by foreign firms and present an obstacle to the free provision of services in the internal market”.

It is no coincidence that both the Viking and Vaxholm judgements in the European Court of Justice attack trade union collective bargaining rights in Scandinavian countries, where they are enshrined both in law and in the constitution. This is the social model which is most at odds with the EU where the “smooth operation of the market” overrides any other rights or considerations.

In the Viking and Vaxholm cases, Swedish and Finnish unions sought to prevent companies paying foreign labour up to 60 per cent lower wages. According to the European Court ruling, while there is a “fundamental” right to take collective industrial action, such action represents a restriction on the right of freedom of establishment where it makes the exercise of that right “less attractive”.

But industrial action is, by its very nature, an obstacle to the activities of a company and free movement. However, the European has now declared in that EU rules on the free movement of goods, services, capital and labour gives private firms protection against collective action by trade unions. In other words, an employer’s right to “freedom of establishment” trumps the right to strike.

Richard Arthur of Thompsons, the trade union solicitors, described the European Court’s rulings as “absurd” and “ludicrous” ones which would run roughshod over universally recognised union rights. In fact, Arthur says this is worse than the anti-union laws Britain already has.

“Tory anti-union legislation only restricted the right to strike by introducing stringent procedures in order to carry out industrial action. However, the European Court of Justice has now given itself the opportunity to scrutinise the legitimacy and the proportionality of any given dispute and the effect on the employer.”

No one should be surprised. Many years ago, in another ruling, the European Court of Justice stated that: “It is well established in the case law of the court that restrictions may be imposed on the exercise of fundamental rights, in particular in the context of a common organisation of the market.” So the human right of withdrawing your labour must not interfere with the “common organisation of the market”.

Such rulings are reminiscent of the infamous judgment in 1901 in favour of the Taff Vale Railway against the Amalgamated Society of Railway Servants for having the audacity to go on strike. The “crime” then was known as being “in restraint of trade”. Today, it is called “freedom of establishment”.

Under the renamed EU constitution, currently being scrutinised in Parliament, an EU institution – the European Court of Justice – would gain huge new powers over member states. The constitution also gives the EU a permanent neo-liberal orientation, while Brussels will gain the power to privatise – the main reason for the “No” votes on the constitution in referendums in France and the Netherlands. This was also the reason why TUC delegates voted against the constitution 2005 and why the TUC renewed its call for a referendum on in 2007.

Under Article III-147 of the old constitution, the EU would be given powers to enforce privatisation in any area of economic activity. “A European framework law shall establish the measures in order to achieve the liberalisation of a specific service”. This provision remains under the reform treaty – which is basically the constitution with another name.

That is why flexicurity, EU court judgments and EU rules on “free movement” – all enshrined in the renamed EU constitution – represent the most fundamental attacks on working people for a generation. If there is a European social model it is enshrined in flexicurity, European Court rulings and mass privatisation. It should be rejected along with the renamed constitution.

Brian Denny is spokesman for Trade Unionists Against the EU Constitution. This article appeared on Compass.

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This post was written by Brian Denny