In December 2001, the Danish social partners agreed to ensuring the full implementation of the 1993 EU working time Directive through subsidiary legislation. So far, the Directive has been implemented in Denmark by means of collective agreements and, according to the European Commission, this is not sufficient to ensure full and correct implementation, as about 15% of employees are not covered by a collective agreement. The European Commission had threatened to take Denmark to the European Court of Justice over the issue, but the social partners' decision has now averted this threat. The decision to use subsidiary legislation may reflect the creation of an 'alternative' Danish model of industrial relations.
Since the adoption in 1993 of Directive (93/104/EC) on certain aspects of the organisation of working time, the European Commission has been waiting for the Danish government's final resolution of how this Directive should be fully implemented in Denmark. In November 1999, the Danish government received a formal letter of notice from the Commission requesting it to ensure that the Directive was fully and correctly implemented. The government replied that the Directive had been implemented through the collective bargaining system and that there is no tradition in Denmark of statutory regulation in the area of employment conditions and industrial relations (DK0001164F). The two main central social partner organisations, the Confederation of Danish Trade Unions (Landsorganisationen i Danmark, LO) and the Danish Employers' Confederation (Dansk Arbejdsgiverforeining, DA), declared in this connection that they would guarantee that employees who were not covered by a collective agreement would in practice be covered by the provisions laid down in the Directive, while the government committed itself to take action if it turned out that there were individuals whose rights were not ensured in spite of this guarantee.
However, in September 2001, the Commission threatened to take legal action in spite of these guarantees, as it argued that about 15% of Danish employees are not covered by any collective agreement. The Commission threatened to take Denmark to the European Court of Justice (ECJ) over the issue. In December 2001, the government decided in consultation with the social partners to extend the coverage of the Directive by introducing subsidiary legislation. An implementation committee was due to meet on 19 December 2001 and the new Minister for Employment, Claus Hjort Frederiksen, plans to table a bill in January 2002. The implementation committee is composed of representatives of the social partners and the government.
SiD opposed subsidiary legislation
LO took some time to approve the decision to introduce subsidiary legislation. The reason was not general opposition in the organisation to this move, but that the decision had to approved at a meeting of the executive committee at the start of December. Unlike within DA, there was not full agreement among all member organisations of LO to approve the decision. Nevertheless, the executive committee decided to support the proposal. Only the General Workers' Union (Specialarbejderforbundet i Danmark, SiD) - which is Denmark's second-largest trade union - was against the proposal until the very end. However, the president of the union, Poul Erik Skov Christensen, had to recognise that there was not sufficient support in LO for SiD's opposition to the proposal. After the meeting, Mr Christensen declared that 'this would have been a good opportunity to test the viability of the Danish labour market model before the European Court of Justice', and that Denmark had a good case. He stressed the fact that industrial relations issues in Denmark are traditionally the exclusive competence of the social partners.
The matter of principle involved in this issue is whether the 'Danish model' can guarantee full and correct implementation of EU social and employment Directives, and the outcome of testing this question before the ECJ would have been of great importance. In this instance, the Commission was not ready to accept the guarantees given by LO, DA and the Danish government concerning the 15% of Danish employees who are not covered by a collective agreement. There was strong pressure on Denmark to comply and this prepared the ground for a new Danish 'erga omnes' model in connection with the implementation of EU Directives. This principle means that agreements between the social partners are - by means of supplementary legislation - extended to cover fields which are not covered by any collective agreements.
Second use of 'dual method'
This is the second time that this new 'dual method' has been used in connection with implementation of EU Directives in Denmark. This method means that collective agreements on working time rules will be given the force of law, with the supplementary legislation referring to the most appropriate such collective agreement in the case of employment which is not covered by an agreement. The law will thus be modelled on the basis of the collective agreements - a point emphasised by Hans Jensen, the president of LO, after the December meeting of the LO executive committee.
The first time that a similar solution was adopted was in connection with the implementation earlier in 2001 of the EU Directive (97/81/EC) on part-time work, when the government asked LO and DA to draw up a proposal on implementation which was subsequently enacted in law (DK0106125F). This was the first example of an 'alternative' Danish model and it did not occur without problems. The other main social partner organisations - which are smaller than LO and DA - were very annoyed at not being involved in the formulation of the legislation, as they normally are. They will, however, be involved in the implementation of the working time Directive. As mentioned above, the new bill will be discussed in an implementation committee where all main social partner organisations are represented.
Commentary
Although the provision in the EU Directive concerning a maximum weekly working time of 48 hours has long ago been outstripped by Danish collective agreements and is without any practical importance, and although the new legislation will merely give collective agreements the force of law, the implementation of the Directive in the form of legislation - under the threat of being brought before the ECJ - will have two important consequences for Denmark.
First, it reflects the growing interest of the European Union in regulating employment conditions by using Directives. The threat of legal action shows that the Commission has no intention of compromising with the Danish collective bargaining model in the future. This means that a solid basis has been established for similar challenges to the Danish model in connection with future Directives, for instance the implementation of Directive (1999/70/EC) on fixed-term work which is due by June 2002.
Second, this new implementation method based on subsidiary legislation has, for the first time since the conclusion of the 'September compromise' (sometimes referred to as the constitution of the Danish labour market - DK9908140F) more than a century ago, challenged the fundamental principle in the Danish bargaining model that basic pay and employment conditions are laid down in collective agreements concluded by the social partners and not in legislation. This fact has been stressed by sceptics and those who wanted to fight the case before the ECJ. For their part, pragmatists argue that EU employment Directives are of only marginal importance in Denmark and that the new implementing legislation will be subsidiary to collective agreements and will only refer to the most relevant collective agreement in those cases where an employee is not covered by a collective agreement.
It will be interesting to see whether this will, nevertheless, create a model which affects 'purely Danish' solutions on the labour market. This should also be seen in the light of the long, four-year term of most current collective agreements, which has increased the danger of politicisation in industrial relations (DK0109101F). The most recent example of this tendency is an announcement by the new liberal-conservative government that it plans to adopt legislation ensuring the right of employers to recruit part-time workers. Legislation in Denmark concerning employment conditions is perhaps no longer a distant prospect and it may turn out that this will not necessarily lead to dramatic confrontations or controversial changes in the roles of, and the balance between, the labour market actors. (Carsten Jørgensen, FAOS)