Globalisation and EU labour law

The unofficial strike action centred on the Lindsey oil refinery in Lincolnshire is illegal, as any strikes called without a ballot and proper notification are counter to employment law. It seems to be based on a complicated example of sub-contracting involving French, US and Italian companies – an example of globalisation involving ‘a process of deeper international economic integration that involves a rapid expansion of international trade in goods and services between countries’.

Total, the owner of the refinery, is a French company. In 2006 they awarded the contract for construction work to California-based engineering group Jacobs, who then subcontracted to an Italian firm, IREM. According to a report on the BBC website, the terms of the contract specified that IREM would be using its existing permanent Italian and Portuguese workforce for the job. They were workers who were immediately available and already trained in the processes to be used; employing local UK workforce instead would have necessitated the time and expense of recruitment and training.

One of the key issues of the dispute seems to be around whether those workers are being employed on the same pay and conditions that UK workers would be. Membership of the EU involves free movement of labour throughout the member states, and case law appears to sanction the right of a company using foreign labour for work in another EU country not to observe local pay rates. However, the Unite union representing workers at the Lindsey refinery believes it could be illegal for companies to exclude UK workers from even being considered for job vacancies, which it claims has happened during this dispute.

The issue of ‘British jobs for British workers’ is another headline issue here. Over the weekend both the Prime Minister and Peter Mandelson cautioned against the risk that taking protectionist measures such as refusing to employ other EU nationals in favour of UK workers would only result in retaliatory measures against UK workers looking to work in other EU states, with an escalation into protectionism in which no one would benefit in the long run.

An evaluative question to consider: as government spending on capital projects is being seen as one of the necessary measures to end the downturn and lift the rate of GDP growth back to positive figures, is there some justification for ensuring that jobs on those projects go to workers who have lost their jobs as part of the cyclical unemployment?