Collective agreements implementing directives

Collective agreements are a mechanism for implementing EU Directives in the field of employment and industrial relations. Article 288 of the Treaty on the Functioning of the European Union (TFEU) stipulates: ‘A Directive shall be binding, as to the result to be achieved, upon each Member State to which it is addressed, but shall leave to the national authorities the choice of form and methods.’ This essentially means that Member States can, if they wish, choose to implement Directives by means of collective agreements. The role of collective agreements in implementing Directives is established in EC law by Article 153(3) TFEU, which states that a Member State may entrust management and labour, at their joint request, with the implementation of Directives adopted pursuant to paragraph 2. Article 153(3) further states that, in that case, it shall ensure that, no later than the date on which a Directive must be transposed, management and labour should have introduced the necessary measures by agreement, the Member State concerned being required to take any necessary measure enabling it to be in a position to guarantee the results imposed by that Directive.

This debate is perhaps most relevant in Denmark, where the industrial relations model is characterised by the use of collective agreements as a mean of implementing both EU Directives and national policies which fall within the scope of their domain. The philosophy behind the Danish model is simple: if the responsibility to implement a policy is in the hands of the social partners, then the social partners will ensure that implementing collective agreements will be applied in an efficient and practical manner.

Recognition of the role of collective agreements in implementing Directives emerged slowly from the case law of the Court of Justice of the European Union (CJEU). The CJEU considered the issue in Commission of the European Communities v. Kingdom of Denmark (Case 143/83 [1985] ECR 427). The Danish government asserted that collective agreements were its choice of form and method for implementation of the obligations of Council Directive 75/117 on equal pay. It was argued that the Danish legislation was but a secondary guarantee of the equality principle in the event that this principle was not guaranteed by collective agreements. An agreement of 1971 created such a provision and covered most employment relations in Denmark. The CJEU ruled that while Member States may leave the implementation of the principle of equal pay in the first instance to representatives of management and labour,this does not discharge them from the obligation of ensuring, by appropriate legislative and administrative provisions, that all workers are afforded the full protection provided for in the Directive. That state guarantee must cover all cases where effective protection is not ensured by other means, for whatever reason, and in particular cases where the workers in question are not union members, where the sector in question is not covered by a collective agreement or where such an agreement does not fully guarantee the principle of equal pay.

A clause concerning implementation by collective agreements is now contained in all Directives where the issues may fall under the bargaining power of the social partners.

See also: collective agreements as a mechanism for the enforcement of EU law; directives .