Summary Free Movement of Workers - Economic Migrants
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Course
EU Law (LL232)
Institution
London School Of Economics (LSE)
Book
European Union Law
Covers all core reading, articles, and most of relevant further reading.
Outlines, and analyses different academic arguments
Proposes solutions / alternatives - helpful for obtaining first class answers
Discusses cases, and their relevance
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Free Movement of Persons (Workers – Economic Migrants)
Issues:
1. The scope of Article 45 TFEU is very broad – prevents discrimination (direct or indirect),
restrictions on market access and provides the right to equal treatment.
2. The definition of a worker
3. Right to Equal Treatment (Welfare benefits), extends to the workers family.
4. February 2016 Brexit – undermined the notion and justification for equal Treatment.
There is a substantial, quite dramatic distinction between economically-active individuals and non-economic actors
(or European Citizens) within the EU. This is because they are conferred extremely different rights.
• The demarcation captures the inherent economic paradigm/nature of the Free Movement of persons,
because providing the right to equal protection to those who work, encourages labour mobility and permits
the optimum allocation of resources, thereby enhancing efficiency.
• Whilst those individuals are unemployed, are not explicitly or directly incentivised to travel across borders,
because they are not conferred such favourable right.
The Scope of Article 45 TFEU – is premised upon indirect and direct discrimination:
• Article 45 of the TFEU outlines that the ‘freedom of movement’ for workers ‘shall entail the abolition of any
discrimination based on nationality between workers of the Member states’ (direct discrimination).
- This shall further ‘entail the right to accept offers of employment, to move freely within the territory of the
Member states’ and ‘to stay in the MS for the purpose of employment in accordance with the provisions
governing the employment of nationals’.
• Therefore, Article 45 is extremely beneficial and significantly generous towards workers because it confers
both the right of non-discrimination (direct and indirect) and the right to equal treatment once working inside
the country.
• Thus, as soon as you qualify as a worker, the individual obtains full and unlimited rights – to free movement,
residence, equal treatment, and such rights are also conferred on the workers family.
- This reflects an economic paradigm of the free movement of persons, because the conferral of such
generous rights explicitly encourage labour mobility and therefore comparative efficiency (Ricardo’s
theory of comparative efficiency – providing more economic wealth to MS’s).
- This does not reflect a social paradigm which is concerned with integrating the European people’s,
because these rights exclusively apply to workers, by virtue of their economic contribution.
• The broad scope of Article 45 is demonstrated in Commission v France C-167/73 → where direct
discrimination was held to constitute a breach of FM of Persons.
• Indirect discrimination is also within the material scope of Article 45, as illustrated in O-Flynn C-237/94 →
where the ECJ held that rules which are likely to disadvantage non-nationals, are also caught by Article 45.
The scope of Article 45 TFEU also extends to market access (deter entry) and therefore applies to indistinctly
applicable rules – The purpose of Free Movement of Workers is not merely to prevent protectionist policies.
• Chalmers (2015) → ‘The court has been strict and has been prepared to review even non-discriminatory
national rules’.
• The ECJ in Bosman (C-415/93) 1995 → adopted a teleological approach towards Article 45, reaffirming that
the objective of Article 45 is to facilitate free movement, which entails the right to enter the labour market,
such that the UEFA regulation imposed a disproportionate interference with the individuals capacity to access
markets, and thus will be within the scope of Article 45 TFEU.
- Similar to Cassis, the ECJ holds that Article 45 TFEU is not just concerned with preventing
discrimination, but also about restricting those rules which prevent the capacity to enter the job market
in the first place – market access.
- Therefore, any national rule which restricts access, even though not discriminatory, is illegal.
• The ECJ’s approach was reiterated in Commission v Denmark (C-462/02) → ‘the manner in which an
activity is pursued is liable to also affect access to that activity’ such that ‘legislation which relates to the
conditions in which an economic activity is pursued may constitute an obstacle to freedom of movement’.
- This is exceptionally wide, as it protects a European worker from discrimination, rules which restrict
market access and regulates conditions of which the employment occurs (equal treatment).
• This adopts a cassis equivalent approach.
• The broad scope of Article 45 TFEU raises similar concerns to the scope of Article 34 TFEU, in which A-G
Tizzano in Caixa Bank (C-442/02) argued that → Interpreting the Freedom, ‘to apply to any measure that
makes the exercise of free movement less attractive’ permits ‘economic operators to abuse’ Article 56 TFEU
and is ‘tantamount to bending the Treaty to the purpose for which it was not intended’ because this would
‘establish a market without rules’, rather than merely without borders.
, • Chalmers (2015) → ‘The Court of Justice may be moving towards a position that in substance is similar to
the position concerning the free movement of goods’.
- Whilst this expansive interpretation may be controversial in free movement of goods, it is extremely
controversial in relation to the free movement of persons – inherently sensitive, political issue (see
below).
• Chalmers (2015) → Extending Article 45 to cover non-discriminatory restrictions on the pursuit of economic
activity ‘have significant market liberalising effects’ but ‘also result in the extension of the reach of these
Articles into almost all areas of regulation of economic life’ – very invasive.
- ‘There is a significant danger of overreaching here, with EU Law being perceived, particularly from a
local perspective, as being both excessively deregulatory and excessively intrusive’.
- Therefore, ‘its case law on non-discriminatory restrictions on the pursuit of economic activity has been
contradictory and uncertain.’
Problem with Broad Nature of Rights:
• The Free Movement of Persons is a deeply sensitive, contested issue within the EU, powerfully demonstrated
by Brexit, because the individualistic aspirations of member state, often seemingly collide with collective
visions of welfare, employment and the internal market.
• Increasingly, the notion of extending welfare benefits to foreign workers is contested, because it is
stimulating considerable infrastructural issues within the MS and can operate to ignore the interests of
nationals.
The determination of what constitutes a ‘worker’ under Article 45 TFEU, is of crucial importance and highly
contested – as this distinction confers a variety of rights on individuals, as compared to unemployed
European citizens.
• The ECJ have judicially conceptualised what constitutes a ‘worker’ – and have had a large amount of
discretion in making this determination. This is because there is no treaty definition of a worker.
• The ECJ held in Trojani C-456/02 → that ‘the concept of the worker…has a specific union meaning and
must not be interpreted narrowly’, affirming that it is not within the discretion of Member States to determine
what they define a worker to be and is purely a European definition.
- The ECJ is demarcating the distinction between a worker and non-worker – which can be problematic if
this undermines the MS’s notion/interpretation of what constitutes a worker, particularly because this
confers a multiplicity rights of such individuals and therefore obligations on the MS’s.
• O’Brien (2016) → “The licence being given at EU level to discriminate against those who are not workers
makes the national processes by which people are defined as workers (free movement on the ground) all
the more pivotal.”
• The ECJ in Trojani C-456/02 outlines that → “Any person who pursues activities which are real and
genuine, with the exclusion of activities purely marginal and ancillary, must be regarded as a worker.” And
further held that ‘the essential feature of an employment relationship is that, for a certain period of time, a
person performs services for and under the direction of another person in return for which he receives
remuneration’.
- Therefore, a European worker is classified as someone who has a real and genuine job, which requires
both subordination and remuneration.
• The court has added further qualifying conditions to the constitution of a ‘worker’:
• As highlighted in Hartmann C-212/05 → a transboundary element, in either residence or employment, is
necessary obtain European Free movement rights.
• The activity must be part of the ‘normal labour market’ as emphasised in Bettray C-344/87 → The ECJ held
that rehabilitation work did not constitute employment. Notably, the court premised its argument upon the
economic nature of the job.
- Nonetheless, in Steymann C-196/87 → the court was considerably generous, holding that remuneration
could be in kind and need not be financial.
• In Kempf (C-139/85) → The court held that an individual merely has to work 8 hours a week, to obtain rights,
this was irrespective of the fact that the individual learned so little that she was forced to apply for benefits.
• EU legislation has never codified these case-law definitions.
• Chalmers (2015) → ‘The definition of worker which emerges from these cases is unusual in EU Law in not
taking account of the personal circumstances of the individual, instead imposing a fixed test’.
- Whilst ‘this may seem quite reasonable from an economic point of view’, it ‘fits uneasily with current anti-
discrimination law which generally requires recognition of the particularly position of disabled people in
the market’.
• O’Brien (2009) → Argues ‘the application of the same ‘worker’ test is inappropriate and actually
discriminatory’, this is because ‘it squeezes social concerns out of the definitional process’
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