3.3.2.2 A titanic struggle: the right to collective action and the freedom to provide services

104. The Court opens the principal part of its judgment by stating that “although the right to take collective action must [...] be recognised as a fundamental right which forms an integral part of the general principles of Community law the observance of which the Court ensures, the exercise of that right may nonetheless be subject to certain restrictions. As is reaffirmed by Article 28 Charter, it is to be protected in accordance with Community law and national law and practices”.1 Objectively, the right to collective action, as a fundamental right, could constitute a restriction on the freedom to provide services allowed by Article 52 TFEU.2 Whether that is indeed the case in the situation at hand, is determined by a proportionality test in which the fundamental freedom to provide services enters the fray with the fundamental right to collective action.3

105. The Court employs the principle of effectiveness and states that in the case at hand the right to collective action, by which foreign undertakings may be forced to sign a collective agreement, is liable to make it less attractive, or more difficult, for such undertakings to provide their services. Therefore, the right to collective action constitutes a restriction on the freedom to provide services.4

106. The Court reiterates that “since the freedom to provide services is one of the fundamental principles of the Community, a restriction on that freedom is warranted only if it pursues a legitimate objective compatible with the Treaty and is justified by overriding reasons of public interests; if that is the case, it must be suitable for securing the attainment of the objective which it pursues and not go beyond what is necessary in order to attain it” [Emphasis added: I.A.].5 In other words: restrictions of fundamental freedoms are assessed on the basis of the proportionality principle. According to the Court, the protection of workers in the host state against social dumping can be considered a legitimate aim. In that regard the Court considers that the Union not only has an economic purpose, but a social purpose too. Therefore “the rights under the provisions of the Treaty on the free movement of goods, persons, services and capital, must be balanced against the objectives pursued by social policy”.6 The Court holds that in this specific case the obstacle that the collective action forms in view of the specific obligations7 the trade unions seek to impose on Laval cannot be justified with regard to the objective of the protection of workers.8 Concerning the negotiations on pay in particular, the Court of Justice argues that the collective action in the main proceedings cannot be justified in light of the public interest objective.9 The specific circumstances of the case and the aim of the collective actions – i.e. discriminating Laval on the basis of nationality and forcing Laval to sign a collective agreement that was more favourable for workers than the relevant implementation legislation required – resulted in the conclusion that in this particular case the right to collective action could not serve as a justification for the restriction of the freedom to provide services.10 The collective actions initiated by the trade unions in this particular case are thus precluded by Article 56 TFEU.11 This ‘mechanism’ and the victory of the freedom to provide services was not welcomed with open arms by everybody.12 Others argue that the Court had no other option considering the wording and weight of Article 56 TFEU and the concrete circumstances of the case.13