The scope of state intervention in labour relations has been upheld by the Court of Justice of the European Union (CJEU), whose case law recognises the legitimacy of legislative measures to regulate the employment relationship.
At the heart of the Court’s jurisprudence is the principle that the worker is the “weaker” or “structurally weaker” party in the contractual relationship. This imbalance, the Court has found, justifies reinforced protection through mandatory rules and minimum standards, opening the way for legitimate state intervention to safeguard employees and correct unequal bargaining power.
Wages and how they are set form part of the employment relationship. As such, measures such as statutory minimum wages, extending collective agreements across sectors, or legislating minimum wage increases are deemed compatible with EU law, which takes precedence over national legislation.
Landmark case: C-55/18
The central ruling that entrenches the principle of the worker as the weaker party is case C-55/18, Federación de Servicios de Comisiones Obreras (CCOO) v Deutsche Bank SAE, delivered on 14 May 2019.
The Court was asked to rule on whether employers are obliged to establish systems to measure the daily working time of each employee. In its judgment, which supported the requirement for such systems, the CJEU reiterated that “the worker must be regarded as the weaker party in the employment relationship and, therefore, it is necessary to prevent the employer from being in a position to impose a restriction of his rights.”
It further stressed that, “in view of the worker’s position as the weaker party, he may be dissuaded from expressly claiming his rights against his employer, since to do so might expose him to measures taken by the employer capable of affecting the employment relationship to his detriment.”