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Extension of Collective Agreements of Higher Level Defying Constitution

Date: 21/04/2016

In its open session dated 16 March 2016, the Slovak Constitutional Court held that the provisions of the Collective Bargaining Act extending the collective agreements of higher level to other employers that are neither members of an employer organisations nor direct parties to these collective agreements are unconstitutional and opposing the European Convention on Human Rights and Fundamental Freedoms.

The opposing motion was filed in December 2013 by 32 opposition MPs. The amendment to the Collective Bargaining Act, which has introduced the controversial extension of collective agreements of higher level without consent of the employers came into effect on 1 January 2014 and has so far produced 15 extensions of collective agreements and their amendments. The following five industries have seen agreement extensions: (i) metallurgy, mining and geology; (ii) land transport; (iii) construction; (iv) electrical engineering, and (v) mechanical engineering (see Legal Updates 22/02/2016).

The Constitutional Court award effectively declared the provisions of Section 7 (1), (2) and (11) of Act No. 2/1991 Coll. on collective bargaining as amended unconstitutional, and the Ministry of Labour, Social Affairs and Family has now been provided 6 months to harmonise the controversial provisions with the Slovak Constitution and the European Convention on Human Rights and Fundamental Freedoms. Failing that, the provisions enabling to extend the collective agreements will become void.

One of the major reasons why the Constitutional Court has held the provisions unconstitutional is that by way of a simple decree issued by a state agency (this being the Ministry of Labour, Social Affairs and Family) published in the Slovak Collection of Laws, collective agreements laying down the obligations of their signatories have been upgraded to a generally binding legal act applicable on other than the collective agreement parties, and this clearly exceeds the constitutionally acceptable law-making boundaries. Otherwise put, elevating secondary legislation to generally binding legislation is something that is clearly not acceptable in a state ruled by law.

According to the department’s minister Ján Richter, drafting an amendment to this act will be one of the priorities of the department for the first half of 2016, but the officials have not yet specified what concrete steps will be taken to harmonise the provisions at issue with the constitution.

One of possible solutions could be to institute the collective agreement extensions on voluntary basis, as was the case in the past, or to introduce the representation principle imposing a minimum percentage of employees in a sector covered by the extended agreement, or thirdly, providing statutory avenues for employers affected by the extension to oppose such action and introducing tools that would effectively enable them to change or overturn a decision on collective agreement extension.

Should you have further questions, do not hesitate to contact our law office.

Mgr. Martina Poliačiková
Attorney
Ružička Csekes s.r.o.
in association with members of CMS
E: martina.poliacikova@rc-cms.sk