Our regular human resources management news roundup from across Europe from the Federation of European Employers (FedEE). Includes: Denmark: New bill on restrictive clauses, ECJ/France: No powers to rule on CNE, EU: ETUC fears the right to strike undermined.

Denmark: New bill on restrictive clauses

The Danish minister of employment has recently published a proposal making it unlawful for companies to maintain secret no-hire agreements and giving employees the right to compensation of at least 50% of their salary if they are prevented from gaining employment due to such restrictive clauses.

Section 18 of the Salaried Employees Act already provides such a level of compensation for employees subject to non-compete and non-solicitation clauses in their individual employment contracts. It also limits restrictive clauses to one year after termination. However, at the moment, no compensation is provided if employees are prevented from taking up employment opportunities because of covert no-hire or other employment cooperation agreements between companies.

Last Summer, following criticism from both sides of industry, the Danish employment ministry withdrew an earlier bill laying down new rights for employees restricted by such agreements. However, the need for regulation in this field was underlined by a decision of the Danish Industrial Court last September. The court found that a temporary work agency's contract with clients excessively restricted employment opportunities for the agency's employees and therefore violated Denmark's general agreement. Although the court ruling has imposed some, limitation on employers, its jurisdiction is limited to members' of employers organisations that are signatories to the general agreement or that voluntarily apply its terms. For this reason, the government proposes to use the new law to extend protection to all employees who are subject to no-hire agreements.

ECJ/France: No powers to rule on CNE

French employers will be relieved to learn that an attempt by a French court in Beauvais to challenge the legal legitimacy of the CNE contract has been rejected by the European Court of Justice (ECJ). The ECJ stated that it had no powers to rule the submission, even though it was made by reference to Articles 30/33 of the Charter of Fundamental Rights of the European Union and Articles 24/27 of the European Social Charter.

The Contrat Nouvelle Embouche (CNE) was introduced in 2005 to permit companies with up to 20 employees to dismiss employees without justification during their first two years of employment. Although the CNE was upheld in October 2005 by the Conseil d'Etat (France's supreme court for administrative justice) and declared to be compliant with ILO convention 158, it has been repeatedly challenged by lower courts

EU: ETUC fears the right to strike undermined

At a meeting organised by the European Parliament in Brussels on February 26th 2008, the General-Secretary of the European Trade Union Confederation (ETUC) claimed that the recent European Court of Justice (ECJ) Laval and Viking cases (see MAJ 2007/25 and 2008/01) have curtailed the right of unions to strike by preventing them from taking unrestricted action to oppose the importation of low-cost foreign labour or the switching of an employer's operations to another EU member state to take advantage of lower wages.

The ETUC has responded to both EJC rulings by proposing that a 'social progress clause' be inserted into the EU Treatyestablishing 'the rights of workers and their representatives to take collective action to improve their working and living conditions above minimum standards'. In the ETUC's view, the Posted Workers Directive should also 'be strengthened to fulfil its original aims of protecting workers'.

EU: Free places on international executive programme

European companies wanting to do business in Japan or Korea may now take advantage of the EU's Executive Training Programme (ETP). This is for one year and consists of three months of intensive seminars in Europe, six months of advanced language and business culture training in Tokyo or Seoul, and three months' internship in a Japanese or Korean-based company.

Being an EU-financed initiative, the ETP is free of charge for the selected candidates. In addition, participants will receive a European Commission scholarship of 24,000 euros during the 2009-10 training cycle (paid in four instalments). On top of that, sponsoring companies are expected to make additional contributions to living expenses while maintaining ongoing contact with participants throughout the duration of the programme.

There are only 45 places available for ETP Japan and 15 for ETP Korea. The application period has just begun and the deadline for applications is 30 September 2008. The training period will run from March 2009 to March 2010. More details may be found at the ETP website.

Other European news in brief

Croatia:
The Croatian prime minister met with employers' groups and trade unions recently to discuss a number of reforms associated with EU entry and also ways to foster 'social partnership'. At the top of the agenda was the creation of a statutory minimum wage. Minimum pay has traditionally been set through a national collective agreement at the lowest threshold for payments of contributions to pensions and health insurance, but trade unions are pressing for it to be given full legal status and introduced at 50% of the average national pay level.

Estonia:
Twelve EU member states still do not have visa waiver agreements with the USA. In a recent parliamentary debate, the Estonian minister of foreign affairs, Urmas Paet, denied that stricter security requirements had been accepted by Estonia, the Czech Republic and Greece than those already applied to other EU states with a waiver agreement. The minister stated that 'Estonia has no interest or intention to achieve visa waiver status on better or worse conditions than other member states of the European Union'.

Germany:
The Administrative Court in Berlin has ruled that a minimum wage introduced in Germany's postal sector on January 1st 2008 was unlawful because it violated the basic rights of companies that are competitors of Germany's main postal delivery firm and former state monopoly Deutsche Post. The German government will appeal against this decision to a higher court, but the Berlin court has left open the question whether the declaring of a minimum wage for protectionist purposes was also unconstitutional.

Netherlands:
The Dutch cabinet appears poised to adopt a proposal introducing a 30% levy on bonuses and golden handshakes paid to top executives. However, the penalty is likely only to be applied to those with annual incomes above 500,000 euros, if their bonuses or exit payments amount to more than their annual salary. Tax penalties could also be imposed on top executives who pay themselves through substantial contributions to pension funds, with the highest penalties being reserved for fund managers owning stakes in the funds they are managing.

Poland:
The Polish labour ministry has drafted an amendment to the labour code reducing the period during which employers are responsible for sick pay from 33 days to 14 days in any year. This will now be submitted for approval by the national parliament.

Spain:
Spain's constitutional court has dismissed a challenge to the 2007 gender equality law made by the Spanish Popular Party (PP). The principal objection made by the PP was to a requirement for political parties to apply gender quotas to candidate lists for elections. The effect of the challenge was effectively to suspend implementation of the law 3/2007 that originally came into force on March 24th 2007. The new law incorporates EU equality directives and establishes an obligation on companies employing over 250 people to negotiate equality plans with their employees.

FEDEE news

Employment Law Europe Conference 2008

A three-day conference on employment law in six European
jurisdictions is to be held in London, UK this Spring. The event
is being run by JSB, a well-established conference organiser,
and places are available on a daily basis for those unable to
attend the whole conference.

Further information and a booking form may be obtained from the
conference website.

Copyright: FedEE Services Ltd 2008