Equal pay for foreign workers

Workers brought in from another EU country to complete a contract must be paid the same as workers in the host country, the European Court of Justice has found.

EU rules on the so-called posted workers have led to disputes in many countries, especially in France, where it was seen as an attempt to force down the wages paid to local workers.

In a case brought by a Finnish body and dealing specifically with the Nordic system of collective agreements, the ECJ clarified the concept of minimum rates of pay for posted workers. It said the law of the host country applies to workers contracted in from another member state, especially in defining minimum pay rates.

This does not preclude a calculation of the minimum wage for hourly work or piecework, which is based on the categorisation of employees into pay groups, provided the calculation is based on rules that are binding and transparent.

A daily allowance to compensate for the disadvantages of posting is not based on actual expenditure but must be classified as an allowance specific to the posting and as such is part of the minimum wage — the same as it would be for local workers sent to another part of their country for a job.

When there is no specific compensation for travelling time based on the actual cost to the worker, it must be regarded as an allowance and part of the minimum wage. Accommodation costs and meal vouchers given to the workers in question did not form part of the minimum wage, it was found.

Posted workers are also entitled to the minimum holiday pay and period of paid annual leave awarded to local workers.

The case was taken when a Polish firm ESA gave Polish employment contracts to 186 Polish workers before posting them to its Finnish branch to carry out electrical installation work at the construction site of a nuclear power station. The workers said they had not been paid the minimum wage due under the universally applicable Finnish collective agreements for the electricity sector and the building technology sector.

The Finnish trade union for the electricity sector pursued their claims.

A spokesperson for the Irish Congress of Trade Unions said while the details were specific to the Nordic model, the ruling confirmed collective agreements must be respected and upheld.