The free movement of workers is enshrined in Article 45 of the Treaty on the Functioning of the European Union and is directly effective on member states,1 both vertically and horizontally.2 As noted in Chapter 1, the EU at its inception was (and still largely is) primarily concerned with economic policy. Its overarching aim of a free market required the free movement of goods and services from one member state to the next. You need to bear in mind that unlike the USA, which is made up of states within one country, the EU is comprised of separate countries each with their own borders and trade tariffs. The EU harmonized trade and competition law throughout the union to make it easier for member states to trade with each other. As well as the freedom of moving goods and services from one state to the next, in order for the market to flourish movement of workers was also required. Prior to the EU, and in the absence of bilateral agreements between states, a work visa would be required before you could go and work in another state. While seen as another step toward full market integration, unlike movement of goods and services, movement of people brings implications beyond market concerns. The free movement of people confers individual rights on persons in a direct sense, which has contributed to the development of fundamental rights and the concept of EU citizenship. This free movement is governed by the treaties and also by secondary legislation.
First, it is workers who have the right to move freely within the EU. This is established in the primary law of the EU. However, over the years the secondary legislation has weakened the link between economic activity and free movement, with workers now being seen as individual humans with rights rather than as production factors.3 The definition of a worker has been developed through the case law of the CJEU without reference to national law. In Hoekstra the court held that the provision would be deprived of effect if the definition or concept of worker could be fixed by national law.4 The essential feature of the employment relationship is that for a certain period of time a person performs duties for or under the direction of another person and for which receives remuneration.5 The work performed must be an economic activity. For example, in Bettray vs. Staatssecretaris van Justitie it was found that a person working in a social employment scheme for the rehabilitation of those addicted to drugs was not performing an economic activity as the purpose of such a scheme is purely social.6
In Levin vs. Staatssecrtaris van Justitie the court found that the definition was not confined to those in employment, but applied also to those actively seeking employment.7 This case, and ones following it, centered on the claimant already being in the host state, but naturally the question arose as to whether a person moving to a member state for the purpose of seeking employment would be classed as a worker under the treaty. In R vs. IAT Ex Parte Antonissen the claimant sought to fight his deportation from the UK to Belgium by stating that he had been searching for employment for six months.8 The court found that the member state has the right to deport after six months if the person is not in employment, unless that person can provide evidence that he or she is genuinely seeking employment and has a real chance of being successful in that search.
Directive 68/360 on the Abolition of Restrictions on Movement and Residence within the Community for Workers of Member States and their Families more fully establishes the rights and limitations than those contained within the treaty. This legislation was supplanted by Directive 2004/38, which amended, replaced, and repealed some older measures. The purpose of the directive is to more fully expand upon the rights contained within the treaty; however, where there is a conflict between the directive and the treaty, the treaty as primary law prevails.
Article 6 of the directive provides that EU citizens and family members are entitled to the right of residence in another member state for a period of three months without the need for formalities or conditions beyond the requirement to hold a valid passport or identity card. This does not confer any rights to social assistance during this time and the state reserves the right to remove the person if he or she becomes an unreasonable burden. Article 7 deals with duration beyond the three-month period. Migrant workers or self-employed retain their residence by virtue of their position as workers. Others (self-funding migrants and students) can remain only where they can show that they have the means to support themselves, which shows a special preference for the economically active. This reflects the concerns of member states in relation to unregulated migration and welfare tourism. In Elisabeta Dano the court upheld the refusal of the state to grant social security benefits to a woman who had lived in the host state for five years but had neither worked nor sought employment.9
The migrant worker, once settled, cannot be discriminated against. In Bosman the case concerned whether UEFA had breached EU law by the implementation of a rule that permitted national football clubs limit the number of foreign players to three.10 The court found that this rule did not apply to other member states as such would discriminate against players on the basis of nationality. In Commission vs. Italy a rule that private security activities could only be carried out by Italian nationals was a breach of Article 45.11
The Bosman case is an interesting one as it deals with circumstances that are neither directly nor indirectly discriminatory based on nationality and shows that measures that have a substantially negative impact on access to the market will be prohibited. The facts of the case were that Mr. Bosman was a Belgian professional football player employed by a Belgian first division club. As his contract was due to expire the club offered him a new contract at a drastically reduced salary, which he refused to sign. As no other club showed interest in signing him he contacted a French second division club. A contract was made for a one-year transfer subject to the French club paying a compensation fee. Both contracts were subject to the condition that the transfer certificate be sent in time for the first match, and the compensation fee was also contingent upon this. The Belgian club had doubts about the solvency of the French club and never sent the transfer certificate; as a result Mr. Bosman’s contract with that club never came into effect. The Belgian club also suspended him for a year preventing him from playing for an entire season. The question was whether the transfer rules developed by the governing association formed an obstacle to free movement. Even though this rule (like the aforementioned UEFA rule) did not discriminate on the grounds of nationality, it had an impact on limiting the movement of workers and therefore breached EU law. The principle from the case can be summarized as follows: Measures that impede access to employment market for workers are prohibited under Article 45 even if they do not directly or indirectly discriminate on the grounds of nationality. These measures may be justified by reason of public interest if they are legitimate and proportionate.
The one exception to this rule is in relation to public-sector employees. The Sotgiu case confirms that this derogation allows member states to restrict access to certain areas of the public sector; however, it does not allow for discrimination once admitted to the sector.12
The principle of equal treatment applies not only to access to the job market but also to the conditions of employment. Article 7(1) of the directive confirms that an employee cannot be treated any differently in terms and conditions of employment based on nationality. An example of such direct discrimination can be seen in Marsmann.13 Here Marsmann was a Dutch national residing in the Netherlands but working in Germany. He suffered an industrial accident that reduced his working capability by 50 percent. German law, which prohibited dismissal on these grounds, did not include workers residing in another member state; this was found to be discriminatory as this protection only applied to workers residing in Germany. An example of indirect discrimination can be seen in Ugliola, which concerned the period of service used to calculate pay or other advantages in a member state.14 An Italian national employed in Germany asked for his time spent in the Italian military to be used in calculating his seniority for his position in Germany. German law provided that service in the German military would be taken into account for such calculation but was silent in relation to other armies. There was no direct discrimination as non-nationals could join the German army. The court found this to be indirect discrimination as, although the criterion was theoretically applicable to both nationals and non-nationals, in practice it would only be fulfilled by nationals.
Social and tax advantages must also be shared in a nondiscriminatory manner. These social advantages have been broadly defined by the CJEU and are not confined to those that the state confers on workers. For example, in Cristini vs. SNCF the defendant was a French railway company that offered discounted fares for large families.15 Cristini, an Italian resident in France was refused the card on the basis of nationality. The court found this to be contrary to EU law.
The concept of social advantage encompasses not only benefits granted by virtue of a right, but also those that are discretionary.16
The court has found that certain social assistance payments are also social advantages. In Brian Collins vs. Secretary of State for Work and Pensions the principle of equal treatment was examined.17 Here it was found that someone who had worked in the host state would be entitled to equal treatment in the social assistance sphere; however, where they had not yet worked the protection of equal treatment would only apply in relation to access to employment. Thus, this somewhat peculiar decision appears to allow for social welfare benefits to be paid as long as the person is genuinely seeking employment. It is difficult to reconcile this case with Article 24(2) of the directive, which explicitly states that the host nation has no obligation to provide social assistance for the first three months of residence, and longer for jobseekers. The case of Vatsouras attempted to address these inconsistencies and decided that benefits that are designed to facilitate access to the labor market cannot be classed as social assistance as per the directive.18
In addition, taxes and tax advantages must be given equally to nationals and non-nationals of an EU member state. This is generally done where residents and nonresidents are treated differently—that is, paying different types of tax or claiming different types of tax relief. In the normal course of things this would be indirect discrimination; however, in taxation this may not be the case as the two may not be in comparable situations.
There are certain derogations or exceptions from the right to move freely and these are generally on the grounds of public policy, public security, or public health.19 In Van Duyn vs. Home Office the applicant was refused leave to enter the UK to work for the Church of Scientology as the state felt that it was a socially harmful organization.20 The court upheld the decision of the UK giving it a wide scope to classify activities it determined to be socially harmful. This scope was somewhat narrowed in R vs. Bouchereau where the court found that a genuine and sufficiently serious threat to public policy affecting one of the fundamental interests of society would have to be shown for any refusal of entry or deportation to fall within the exception.21
Thus, the free movement of workers has evolved into the free movement of people. Citizens of any member state are free to travel to any other member state without restriction for a period of three months. Initially the host state had more control over when it could deport a person back to the home state if that person was not economically active. The evolution of the law shows that this, while still a factor, will not be the sole determinative issue. Benefits that are designed to assist a person into employment are to be made available to all, and a person who has worked toward gaining employment will be entitled to the same level of unemployment benefits. This shows that the EU is moving toward more protection for human rights, seeing people as more than mere economic actors.
1 Case 41/74 Van Duyn [1974] ECR I-1337.
2 Case 415/93 Bosman [1995] ECR I-4921.
3 Berry, A., M.J. Homewood, and B. Bogusz. 2015. Complete EU Law: Text Cases and Materials, 2nd ed, 428. London: Oxford University Press.
4 Case 75/63 Hoekstra [1964] ECR I-177.
5 Case 66/85 Lawrie-Blum [1986] ECR I-2121.
6 Case 344/87 Bettray [1989] ECR I-1621.
7 Case 53/81 Levin [1982] ECR I-1035.
8 Case C-292/89 R [1991] ECR I-745.
9 Case 333/13 Dano Judgment 11 November 2014.
10 Case 415/93 Bosman [1995] ECR I-4921.
11 Case 283/99 Commission vs. Italy [2001] ECR I-4363.
12 Case 152/73 Sotgiu [1974] ECR I-153.
13 Case 44/72 Marsmann [1972] ECR I-243.
14 Case 15/69 Ugliola [1969] ECR I-363.
15 Case 32/75 Cristini [1975] ECR I-1085.
16 Case 65/81 Reina [1982] ECR I-33.
17 Case 138/02 Collins [2004] ECR I-2703.
18 Case 22 and 23/08 Vatsouras [2009] ECR I-4585.
19 Chapter VI.
20 Case 41/74 Van Duyn [1974] ECR I-1337.
21 Case C30/77 Bouchereau [1977] ECR I-1999.