European Industrial Relations Dictionary - Individual employment relations

Individual employment relations comprise the relationships between the individual worker and employer. These relationships are shaped by legal regulation and by the outcomes of social partner negotiations over the key terms and conditions governing the employment relationship.

Core interest of the Union

These relationships have represented a core interest of the European Community, initially in the context of creating a common labour market for all categories of workers, including self-employed persons, and in guaranteeing their rights to free movement and social security. Individual employment has also been of concern to the European Community, due to labour’s role as a factor of production in European economic integration. Labour costs, particularly indirect labour costs, are an element of competition between enterprises in different Member States and the enlargement of the European Union, particularly from May 2004 onwards, demonstrates this. As a result, and specifically to prevent unfair competition, the indirect costs to employers of compliance with social and labour regulations governing individual employment have been relevant to the establishment of a common market.

A second objective of the Union, traceable back to its origins, is the improvement of living and working conditions (now Article 151 TFEU). As the social dimension of the EU has developed, this objective has evolved, becoming more concerned with work and employment. In this context, the concept of decent work is also relevant. Here the aim is to extend the objective beyond just ensuring minimum labour rights, to the promotion of job creation, social dialogue and improved governance.

Regulatory framework

Regulation in the sphere of employment and industrial relations takes place either through the exercise of legal regulatory powers, through social partner actions or by way of a combination of both.

Individual employment relations in the EU are undertaken within a collective regulatory framework, comprising legislation and framework agreements reached through the EU social dialogue. This framework applies to different individual employment relationships, including the employee with a contract of employment, as well as other types of employment relationship, including workers without a contract of employment, economically dependent workers and self-employed persons. It has focused on the increasing fragmentation of the labour force, demonstrated alongside the standard employment of the male, full-time and permanent industrial worker, through a variety of types of so-called atypical workers, including casual workers, seasonal workers, homeworkers, teleworkers and temporary agency workers. In addressing the problem of atypical work, the EU has encountered the problems, often found in national labour regulation, of defining the scope and coverage of regulation. On the side of the employer, too, the EU’s regulation of individual employment has had to adapt to employers with complex corporate structures.

Legal regulation of employment relationships

With respect to legal regulatory powers, these were greatly enlarged in the new Social Policy Protocol inserted by the Treaty of Maastricht and again revised by the Treaty of Lisbon which came into force on 1 December 2009. Article 153 TFEU provides legislative competence over working conditions, social security and social protection of workers, where their employment contract is terminated by dismissal. Key areas covered through legal regulation include: rights to written contract terms; protection against discrimination; health and safety protection; and protection against unjustified dismissal.

An important step was taken by Council Directive 91/533, which requires the employer to provide written proof of employment as a means of combating undeclared work. This written proof must include information on employment status and conditions, including all essential terms and conditions of employment, such as the place of work, description of the work, working time, leave and notice entitlements, and so on. The written information must include the collective agreements and working conditions governing the employee’s conditions of work. The Directive furthermore states that individual workers must also be notified of any changes in working conditions specified in the written document.

EU legislation regulating substantive conditions of work includes wide-ranging provisions in two particular areas: discrimination and equal treatment, and health and safety in the working environment.

EU laws prohibiting discrimination on grounds of gender, race or ethnic origin, age, disability, religion or belief, and sexual orientation (Council Directive 2000/78 and Council Directive 76/207/EEC of 9 February 1976 as revised by Council Directive 2002/73/EC) are concerned with less favourable treatment as regards pay and working conditions, but also access to employment, dismissal and vocational training. The Fundamental Rights Agency provides assistance and expertise to the EU and its Member States on fundamental rights matters. Its prime objective is to provide objective, reliable and comparable data on the phenomena of racism and xenophobia and anti-semitism.

EU regulation of health and safety has had a considerable impact on individual employment relationships. For example, the particular risks to the health and safety of temporary workers led to a specific Council Directive 91/383. Health and safety regulation at EU level has important consequences for the organisation of working time, for example, on overtime working, and Council Directive 93/104/EC establishes entitlement to annual leave which does not permit the exchange of such leave for payment.

Security of individual employment and protection against unjustified dismissal is within the competence of EU regulation. Although there is legal competence to adopt general directives on termination of contracts of employment, none has yet been achieved, perhaps because regulation of dismissals presents problems well known in national laws. However, EU law does lay down a general prohibition of discrimination in dismissals, and regulates specific cases, such as dismissals in connection with fixed-term contracts, and dismissals and victimisation. The latter represents just one aspect of protection against the victimisation of workers who claim their individual employment as well as collective labour rights.

Despite the extensive regulation of forms of individual employment and terms and conditions of employment, there is uncertainty about the general competence of the EU to regulate pay issues. Article 31 of the Charter of Fundamental Rights of the European Union, proclaimed by the European Parliament, the Council of the European Union and the European Commission on 14 December 2007, refers to ‘fair and just working conditions’, but does not specify pay, other than in relation to paid annual leave. Yet, the specific reference to fairness in working conditions leaves the matter open to a certain amount of doubt.

Social partner regulation of employment relationships

At EU level, the social partners have become important regulators of employment relationships, through the adoption of framework agreements on issues such as part-time work, parental leave and on fixed-term work. These agreements have been translated into EU directives binding on all Member States and as a consequence Member State laws, regulating employment relationships, must conform to the principles contained in the social partner agreements.

The social dialogue route to EU regulation on individual employment does not always lead to legal regulation, as it did in relation to the above three framework agreements. The representatives of the social partners at EU level may also conclude autonomous agreements that are contractually binding on the social partners but which are not translated into legally binding directives. In general, regulation of individual employment relations through this route is less likely to require that the individual employment relationship is altered. However, these agreements set a basic standard that the social partners at national, regional and sectoral level can refer to in drawing up their own agreements and these agreements do determine individual employment relationships and the content of employment contracts. Regulation of individual employment may also be achieved through a combination of legislation and collective bargaining. For example, the policy of promoting flexibility in the organisation of work has proceeded primarily through the prescription of legislative standards, but allowing for adaptation to patterns of flexible working time through the mechanism of collective agreements. The Framework Agreement on Part-time Work (annexed to Council Directive 97/81) combines these approaches by laying down a principle of non-discrimination against part-time workers and aiming to improve the quality of part-time work, including the promotion of part-time working opportunities as a contribution to the flexible organisation of working time.

Finally, the Charter of Fundamental Rights of the European Union, since 1 December 2009 integral part of Union law, includes definitions of fundamental individual employment rights, including protection of personal data (Article 8), freedom to choose an occupation and right to engage in work (Article 15), non-discrimination (Article 21), equality between women and men (Article 23), protection in the event of unjustified dismissal (Article 30), fair and just working conditions (Article 31) and prohibition of child labour and protection of young people at work (Article 32).

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