08-02-08

Latvian construction firm Laval un Partneri won a victory at the European Court of Justice (ECJ), which ruled on December 18th, 2007 that Swedish trade unions had breached EU regulations by blocking the renovation of a school in the city of  Vaxholm by a subsidiary of the Latvian company.

Sweden has a long tradition for setting salaries by negotiations between the employers and the Trade Unions. This case concerned a Latvian Construction company called Laval un Partneri, which posted workers to a Swedish building site after having won a public procurement competition, to work mainly on extensions at a school in the town of Vaxholm in 2004. The works were handled by a subsidiary, L and P Baltic Bygg.
Sweden's Local Construction Workers Union “Byggnads” accused Laval of paying rates far lower than permissible and blockaded three of its building sites to pressure the subsidiary into signing a collective wage agreement. So the Latvian workers went home.
 
In its ruling, the ECJ recognised the right of workers to take collective action but it said that the picketing in this case had restricted the right of the Latvian company to provide services and was not justified with regard to the public interest of protecting workers. This has created an intense debate in Sweden on the right to negotiate salaries and its compatibility with EU legislation.