Tuesday, 21 March 2017

What is the point of minimum harmonization of fundamental rights? Some further reflections on the Achbita case.

Eleanor Spaventa, Director of the Durham European Law Institute and Professor of European Law, Law School, Durham University

Ronan McCrea has already provided a very thoughtful analysis of the headscarf cases; this contribution seeks to complement that analysis by focusing on two issues arising from the Achbita case: first of all, the structural problems with the ruling of the Court, both in terms of reasoning and for the lack of information provided; secondly, the more general implications of the ruling for fundamental rights protections and the notion of minimum harmonization in the EU context.

It might be recalled that in the Achbita case a Muslim woman was dismissed from her employer for refusing to remove her headscarf, contrary to the employer’s policy of neutrality, which included a ban on wearing religious symbols. The case then centred on the interpretation of the framework discrimination Directive (2000/78) which prohibits, inter alia, discrimination on grounds of religion. The Belgian and French Government (which had a direct interest because of the Bougnaoui case) intervened in favour of the employee, believing that the discrimination at issue was not justified (Achbita opinion, para 63). The Court, following the Opinion of AG Kokott, found that the rules at issue might constitute indirect discrimination; that the employer’s aim to allegedly maintain neutrality was a legitimate aim as it related to its freedom to conduct a business as protected by Article 16 Charter. It then indicated that the policy was proportionate, if applied with some caveats.

The reasoning of the Court – some structural deficiencies

The headscarf cases are of fundamental importance to the European Union and to all of its citizens, not only those who practice a non-dominant religion, and as such have been widely reported even outside of the EU. One might have expected the Court to engage with a more thorough analysis of the parties’ submissions and of the issues at stake. Instead, we have two very short rulings with very little detail. Just to give an important example – in both cases the French and the Belgian governments sided with the claimants, hence drawing a very important conceptual limit to the principle of laïcité which is justified, in this view, because of the very nature of the State and its duty of neutrality, a duty which cannot be extended to private parties (or if so only exceptionally). This important distinction is not discussed in the ruling, not are the views of the governments who would be directly affected by the rulings.

More importantly though, the fact that the arguments of the parties are not recalled has also more general consequences: as it has been noted by Bruno De Witte elsewhere, the fact that no hermeneutic alternative is provided might give the impression that no hermeneutic alternative is in fact possible, as if legal interpretation is simply a matter of discovering the true hidden meaning of a written text. This approach, not uncommon in civil law jurisdiction but more nuanced in constitutional cases, hides the fact that, especially in cases of constitutional significance, there is more than one legitimate interpretative path that could be chosen, which also reflect different policy alternatives. Interpretation then is also a choice between those different paths: a choice which is, of course, constrained by the relevant legal system and one that might be more or less persuasive.  The failure to acknowledge counter-arguments then results in rulings, like the ones here at issue and many others in sensitive areas, which are not only potentially unhelpful, but also close the door to more effective scrutiny of the reasons that lead the Court to follow a given interpretation.

In the same vein, the analysis of the discriminatory nature of these provisions is rather superficial. In particular, there is no thought given to the fact that contractual clauses allegedly protecting a principle of neutrality, might not only have a discriminatory effect against certain individuals, but might have important inter-sectional (or multiple) discriminatory effects. In other words, a rule banning religious symbols might in fact also have a more pronounced effect on people from a certain ethnic background or a certain gender. Equally disappointing, and in this writer’s opinion legally flawed, is the approach taken in relation to the finding of the potentially indirectly discriminatory effects of the rules at issue. Here, the Court requires the national courts to determine whether the ‘apparently neutral obligation [(not to wear religious symbols)] (…) results in fact in persons adhering to a particular religion or belief being put at a particular disadvantage.” (para 34, emphasis added).

There are two issues to be noted here: first of all, the Court remains silent as to what type of evidence of indirect discrimination is required, and by whom. In discrimination cases, burden of proof is crucial. This is recognised by the discrimination directives at EU level, including Directive 2000/78 which provides that if the claimant shows direct or indirect discrimination, then it is for the ‘respondent to prove that there has been no breach of the principle of non-discrimination’ (Article 10(1)). One would have expected then the Court of Justice to instruct the national court to require the defendants to discharge this duty with a certain rigour, also by means of statistical analysis of the effect of such policies on religious minorities. Yet, the Court does not even engage with this question.

Secondly, and not less important, the Court seems to imply that a rule that discriminates all religious people would not be problematic. For instance if, say, Muslims and Orthodox Jews were equally discriminated against, whilst non-religious persons were unaffected, then, based on the dicta of the Court, there would be no discrimination. This interpretation seems restrictive and not supported by the text of the directive (or the Charter) that refers to discrimination on grounds of religion in general. In any event, in discrimination cases it is crucial to identify the comparator, and the Court fails to do so clearly and to support its choice with sound legal arguments. But, beside these very important structural issues, the Achbita ruling raises other more technical as well as general issues, as to the extent to which the Court’s interpretation might affect the Member States’ discretion to provide more extensive protection that that provided for in the Directive.

Minimum harmonization and fundamental rights

Directive 2000/78 is intended only to set minimum standards, so that Member States can, if they so wish, provide for a more extensive protection. Indeed many Member States have done so by extending either the protected categories of people, or the field of application of the legislation, or both. In theory then, the Achbita ruling should not be seen as the last word in relation to the treatment of religious people at work. After all, if Belgium or France or any other country finds the ruling problematic, it can simply pass legislation prohibiting private employers from requiring religious neutrality from its employees, unless of course a specific dress code is necessary to ensure the health and safety of the worker or the public. Viewed in this way, and notwithstanding the structural problems identified above, the ruling seems very sensible: it is agnostic, in that it does not impose either model on Member States, allowing therefore a degree of variation in a very sensitive area, something which, as eloquently discussed in McCrea’s post, might not be a bad thing. After all, this is the same path that has been taken by the European Court of Human Rights.

However, things are slightly more complicated in the European Union context. In particular there is nothing in the ruling to indicate that the Directive sets only minimum standards so that it would be open to those Member States to go further in protecting people holding religious beliefs. And, more crucially, the Court, mirroring the opinion of Advocate General Kokott, refers to the EU Charter of Fundamental Rights when assessing the legitimacy of the justification put forward by the employer. In particular, it finds that the business’s wish to ‘project an image of neutrality (…) relates to the freedom to conduct a business that is recognised in Article 16 of the Charter and is, in principle, legitimate’.

The reference to the Charter, which indirectly frames the question as a clash of fundamental rights, is important because, in the EU context, when the Charter applies it sets the fundamental rights standard. In simpler terms this means that should a Member State wish to provide more extensive protection to ensure that employees are not discriminated on grounds of their religious belief, something that is allowed under Directive 2000/78, it might be prevented from doing so since, pursuant to the Achbita ruling, it would infringe the right to conduct a business as protected by the Charter. In this way, far from leaving the desired flexibility and discretion to the Member States, the Court sets the standard – employers have a fundamental right, albeit with some limitations, to limit the employees’ right not to be discriminated against. One might well ask then, much as it has been remarked in relation to the Alemo Herron case, what is the point of minimum harmonization directives if the upward discretion of the Member States is so curtailed.


The Court of Justice did not have an easy task in the Achbita case: it was pretty much a ‘damned if you do, damned if you don’t’ scenario. For sure, some of us would have liked the balance at issue to be tilted firmly in favour of religious minorities, especially given the growing evidence of attacks and discrimination against, particularly, Muslim women. The Court chose a different path and that is, of course, within its prerogatives. However, the way that path was trodden upon leaves many open questions both in relation to the way the result was achieved, and to the many questions it overlooks. What is most troubling is the implication that the freedom of Member States to provide greater protection towards minorities may, in principle, be constrained by the Court’s interpretation of the freedom to conduct a business.

Barnard & Peers: chapter 9, chapter 20

Photo credit: smallbusiness.co.uk

Monday, 20 March 2017

From Austerity Back to Legitimacy? The European Pillar of Social Rights: A Policy Brief

How Juncker can make ‘The European Pillar of Social Rights’ deliver a powerful message that the EU is an area of dignity, autonomy and social justice

Claire Kilpatrick (EUI), Elise Muir (Veni Fellow, Maastricht) and Sacha Garben (College of Europe, Bruges)

Since the financial crisis began and the EU's response to it included wider austerity in a number of countries, there have been doubts among many citizens that the EU is still committed to prosperity and rising living and working standards. The recently announced ‘European Pillar of Social Rights’ is an attempt to address this concern. In our view, the Pillar must include binding and high-profile pledges - on minimum wage and minimum income - in order to address citizens' concerns and for the EU to move on from austerity back to legitimacy.

The ‘European Pillar of Social Rights’ is a Commission policy initiative launched in March 2016. Our analysis reflects on the policy process and proposals to date. It explains why a High-Level Conference on the Pillar held in late January 2017 is the most important staging-post to date. We make proposals for orienting the Pillar initiative towards delivering dignity, autonomy and social justice in the EU and evaluate the constitutional implications, especially in terms of EU competence, of the commitments to introduce EU measures on minimum pay and income, and to restrict the Pillar to the euro-area states. The Pillar initiative seems likely to feed into the Commission White Paper on the Future of Europe launched in March 2017 which will be followed by a series of reflection papers of which the first mentioned is developing the social dimension of Europe. Accordingly it is an important new policy juncture for Social Europe which deserves analysis and input.

The Pillar is an open process with impressive civil society and EU institutional participation.

The High Level Conference organised by the Commission on 23 January 2017 on the European Pillar of Social Rights showed it attracts as much attention as it is mysterious. Numerous stakeholders alongside at least ten Commissioners, including President Juncker and Vice-President Dombrovskis, representatives of various EU institutions including President Tajani of the European Parliament and government ministers converged on Brussels to voice their opinions on the European Pillar of Social Rights.

The many interventions left little doubt that the precise legal shape and policy content of the Juncker Pillar remains undetermined and thus open for discussion. Hence, rather than reading the Pillar consultation document with its draft list of ‘principles’ as a quasi-finalised text with just its legal status and scope to be determined, the Pillar consultation is best seen as providing a vehicle for a wide range of proposals on resetting Social Europe.

Seen as such a process, the Pillar consultation has been a success. Over 16,000 individuals and organisations filled in the questionnaire issued as part of the Consultation and around 200 written contributions were submitted to the Commission. In Autumn 2016, national consultation events were held across the EU Member States. The very substantial NGO and union presence at the High-Level Consultation testifies to civil society engagement and investment in the Pillar consultation. Amongst these, the Social Policy Platform deserves to be highlighted. By bringing together since 1995 over 30 different social NGOs, including Age Platform Europe, PICUM (Platform for International Cooperation on Undocumented Migrants), EAPN (European Anti-Poverty Network), Housing Europe, ILGA-Europe, European Youth Forum and the European Disability Forum, it had an added legitimacy and voice in the process. It disseminated well-defined proposals for the Pillar. In light of Juncker’s announcement in his closing speech, it produced the most resonant proposal of a minimum income directive and a proposal on minimum pay via the European Semester.

The frames of discussion failed to give EU social rights and values their central place in the Pillar.

The European Pillar of Social Rights initiative comes after a decade which has altered perceptions of the EU as a benign or mildly positive force for social justice in Europe.  Sovereign debt and EMU governance are one important reason for this shift. Another relates to concerns triggered by free movement after the 2004 and 2007 enlargements. Political developments make it vital for the EU to use the Pillar to reassert the pursuit of social justice as a central part of its mission. Yet the urgency and importance of recentring the EU’s social justice roles and responsibilities was not fully acknowledged by many actors at the High-Level Consultation. There is a risk of doing too little.
Getting the frames of analysis right is crucial to guide the Pillar and the decisions and actions on its implementation. The frames or narratives which were very present during the High-Level Consultation were:

Social Europe was desirable provided EMU debt and deficit limits were respected;
Social Europe, the EMU and the internal market can or do happily co-exist;
Social Investment is the guiding frame for the Pillar of Social Rights and is not incompatible with social rights as human rights;
Adapting to new technologies and work platforms is the main priority for Social Europe.

In our view, these frames should not be those guiding the Pillar process or its implementation. Instead it is vital to make it explicit that the driving force for legal and policy change is the desire to protect the dignity and autonomy of individuals as well as social justice.

Dignity recognises the equal and intrinsic worth of every human being while autonomy requires political institutions not to deprive individuals of valuable options in areas of fundamental importance in their lives. In the absence of such an explicit message in the Pillar, or if the message is blurred by economic arguments in support for change, or made subject to economic conditions, or wishing away hard choices between the economic and the social, or attributing Social Europe’s malaise to new technologies and platforms, the message and its delivery will be imperilled. 

Protection of individuals and their dignity and autonomy has a firm EU law basis bolstered by national constitutional and international human rights law. Dignity is the foundational principle of the EU Charter of Fundamental Rights and many of the rights it contains are specifications of those foundational commitments. Hence ,for example, the Charter ‘recognises and respects the right to social and housing assistance so as to ensure a decent existence for all those who lack sufficient resources’ (Article 34(3)) and ‘the right to working conditions which respect his or her health, safety and dignity’ (Article 31). Most closely related to the value of autonomy in Social Europe are the EU Charter commitments to the right to engage in work and pursue a freely chosen occupation as well as the freedoms of association (Article 15), expression, information and consultation (Articles 11 and 27), to collectively bargain and take collective action (Article 28).

Beyond the EU Charter and human and constitutional rights’ commitments, the EU’s social justice and progress objectives feature prominently in the Treaties: in the TFEU’s preamble as the resolve to ensure the ‘social progress of their States by common action to eliminate the barriers which divide Europe’. Article 3 TEU conceptualises the EU as ‘a social market economy’ aiming at full employment and social progress, and provides that it ‘shall combat social exclusion and discrimination, and shall promote social justice and protection’. These objectives shall furthermore be mainstreamed across all EU policies, in accordance with Article 9 TFEU, which provides that ‘in defining and implementing its policies and activities, the Union shall take into account requirements linked to the promotion of a high level of employment, the guarantee of adequate social protection, the fight against social exclusion’.

A European Pillar of Social Rights must be founded on these values and be concerned with their promotion and guarantee in a changed EU membership and EMU context.

The EU constitutional implications of a Eurozone pillar and minimum income and pay guarantees

The Commission President made a twofold announcement: an initial focus of the Pillar on the Eurozone and a dual guarantee for minimum pay and income.

We strongly endorse the proposals to focus on minimum pay and income for those living and working in Europe. These proposals not only address the preoccupation that the EU has threatened these protection floors, they also enshrine the values of dignity and autonomy in the EU. Yet to properly realise those values requires minimum pay and income instruments to apply to all EU Member States, not simply Euro area states. Sovereign debt arrangements applied to three non-euro area states and concerns that enlargement threatens the social floor are not confined to euro area states either. Minimum pay and minimum income are social guarantees of a fundamental nature that should apply across the EU. Indeed the social acquis, other than the brief opt-out by the UK between Maastricht and Amsterdam, has always applied to all those living and working in Europe and should continue to do so.

Moreover, to make them tangible, these EU minimum income and pay guarantees must be enshrined in visible and effective instruments. In both cases, our preference would be for legally binding Directives which should be complemented with soft law commitments in the European Semester and programme commitments in sovereign debt loan states.

This raises questions of EU competence to adopt such legally binding measures.

For minimum income, we agree with the Social Policy Platform that Article 153(1)(h) TFEU which allows for binding measures to be adopted using the ordinary legislative procedure for the integration of persons excluded from the labour market is appropriate.

It is widely assumed that it is impossible for the EU to adopt a minimum pay directive because Article 153(5) TFEU states that the social policy legal base ‘shall not apply to pay’. However, the Commission may have in mind a creative literal reading of the combination between Article 153(5) and Article 352 TFEU (the ‘residual powers’ clause of the Treaties). Article 153(5) TFEU could be read as excluding only the adoption of a minimum pay directive under the Social Policy Title of the Treaty without excluding other possible legal bases.

Article 352 TFEU would then be examined as a potential legal basis for a minimum pay directive. Article 352 can be used ‘where the Treaties have not provided the necessary powers’ but cannot be used to harmonise Member States’ laws or regulations ‘where the Treaties exclude such harmonisation’. However, this harmonisation exclusion could be read as applying only in those cases where the Treaties clearly in terms outlaws harmonisation such as in the areas of vocational training (Article 166 TFEU) and culture (Article 167 TFEU) (each allowing legislative measures to be adopted ‘excluding any harmonisation of the laws and regulations of the Member States’). It therefore would not apply to Article 153(5) TFEU. Following this interpretation, a minimum pay directive could be adopted if it achieved the unanimous Member State support required under Article 352 TFEU. It remains to be seen if such a line of reasoning would be accepted by the EU legislator.

The question could be raised whether the internal market legal basis of Article 115 TFEU could be used for the adoption of a minimum pay directive (Article 114 TFEU cannot be used, since Article 114(2) TFEU prevents reliance on Article 114(1) to protect the rights and interests of employed persons). There is an argument that such a measure, even if it would retain certain differences in minimum pay levels among EU Member States, would help reduce distortions in competition. Not only would it facilitate the application of the Posting of Workers Directive in the area of cross-border service provision, having a certain minimum pay level in all Member States could more generally help limit competition on wages. Whether the expected reduction in distorted competition would be sufficient to fulfil the conditions for use of the internal market legal basis is an open question, and would depend in part on at what (relative) level the wage would be set and whether this significantly decreases current differences in pay among the Member States.

However, even if this would be accepted as possible in legal terms, there are several reasons why Article 115 TFEU would not be the advisable course of action. If the directive is about achieving genuinely social objectives, the use of an internal market legal basis is unwise, as the Court is then more likely to interpret the measure in a market-friendly way in case of a conflict between ‘the social’ and ‘the market’ (which is arguably what happened in the case of the Posting of Workers Directive, as well as the Collective Redundancies Directive).  And as Article 115 TFEU requires unanimity as much as Article 352 TFEU, there is little strategic advantage in using it either.

Subsidiarity concerns will evidently be addressed by setting pay and income levels appropriate to each state. EU respect for the Council of Europe and commitment to social rights can be underlined by using that body’s European Social Charter commitments and elaboration of the right to a fair remuneration (Article 4(1)) and to social assistance (Article 13) as base-lines.

The former provision requires States ‘to recognise the right of workers to a remuneration such as will give them a decent standard of living’, and the European Committee of Social Rights has ruled that the lowest net wage must be above a minimum threshold, set at 50% of the net average wage, while state conformity will be assumed above 60% of the net average wage. The latter provision deems assistance appropriate where the monthly amount paid to a person living alone is not manifestly below the poverty threshold (50% of median equivalised income as established by Eurostat).

If it is decided necessary for transitional or political reasons to proceed with the nineteen euro area states or some other subset of EU Member States, this opens a further set of questions about the legal basis of measures for minimum pay and income as the legal bases indicated are for all Member States. Although the Lisbon Treaty added a new legal basis, Article 136 TFEU, for measures addressed only to euro area states, we do not consider this a suitable basis for minimum income and pay legislative proposals for two reasons. The first is that, although used (questionably) to create measures providing for EMU sanctions for euro area states (see C. Kilpatrick, ‘The New Economic Component of EMU: A Lawful and Effective Design?’ EUI Working Paper, ADEMU Horizon 2020 Project Series, 2016), its centre of gravity lies in strengthening coordination and surveillance under the European Semester. The second is that legislative proposals for minimum pay and income, based on dignity, autonomy and social justice, should not be grounded in a macro- economic competence.

What then are the alternatives for legislative measures on minimum pay and income covering only some EU Member States? One possibility is enhanced co-operation, a process whereby some Member States adopt EU law without unwilling Member States (see Article 20 TEU and Articles 326-334 TFEU). This can be used only as a last resort where the Council has established that the objective sought cannot be achieved within a reasonable period by the EU as a whole and hence could provide an alternative avenue for minimum income and pay proposals should EU-wide agreement prove unattainable.

Another possibility is ‘going outside’ the Treaties via an international agreement on these matters between only the participating euro area states or those states and other willing participants. The former was the model used in the sovereign debt crisis to set up the European Stability Mechanism in 2012 and its predecessor, the European Financial Stability Fund in 2010. The latter was the path chosen for the Fiscal Compact Treaty of 2012. However, such parallel integration however raises important legitimacy concerns: see S. Garben, ‘Restating the Problem of Competence Creep, Tackling Harmonization by Stealth and Reinstating the Legislator’, in: S. Garben and I. Govaere (eds.), The Division of Competences in the EU Legal Order: Reflections on the Past, the Present and the Future (2017, Hart Publishing).

This is not to deny Mr Juncker’s welcome recognition that the constraints imposed in the context of EU macro-economic governance justify special attention to socializing the European Semester. It is also certainly the case that EU legislative commitments can usefully be complemented by action in the European Semester. We make proposals to do so in the next section. 

Beyond the Juncker announcement: the Pillar needs to strengthen, broaden the social acquis and socialize the European Semester

At the time of the 60th anniversary of the Treaty of Rome, it may be recalled that the TFEU enables the adoption of EU legislation on a fairly broad set of social questions. For instance, Article 153 TFEU allows for the adoption of legislation on workers’ health and safety, working conditions or information and consultation of workers. A whole body of social legislation has been adopted at EU level and begs for modernisation. As mentioned in this note already, the Charter of Fundamental Rights of the European Union - that has the same legal value as EU primary law since the entry into force of the Lisbon Treaty - also contains a set of provisions on solidarity that have so far been little used.

Curiously, the ability for the EU to intervene through legally binding instruments had been subject to little attention during the High Level Conference. One could hence fear that the Commission will shy away from making hard law proposals. We would thus like to underline the importance of anchoring the Pillar in EU social policy and giving expression to the social provisions contained in the Charter. This is necessary to ensure that the Pillar indeed enhances the protection of the dignity and autonomy of individuals across Europe.

We have already made suggestions elsewhere to broaden and consolidate the EU social acquis (see S. Garben, C. Kilpatrick and E. Muir, Towards a European Pillar of Social Rights: Upgrading the Social Acquis, College of Europe Policy Brief #1.17). We suggested the adoption of (1) a Directive for the Protection of Dependent Workers, ensuring the application of the existing EU social and labour law measures to all dependent workers (2) a Protection against Precarious Work Directive, (3) a Directive for the Enforcement of Workers’ Rights.  We also called for (4) a Declaration safeguarding the integrity of the social acquis as an EU floor for worker protection.

A further re-centring of EU competences in the social field could lead to the re-adoption of Directives such as the Collective Redundancies Directive and the Directive on the Transfer of Undertakings on social legal bases. Indeed, these Directives remain abnormally grounded in EU internal market competences. It would be naïve to ignore the possibility of tensions between the economic and the social dimensions of these instruments, as illustrated by the recent AGET case before the CJEU (freedom of establishment v. domestic rules protecting against collective redundancies). The social nature of these legislative instruments ought thus to be consolidated. The assertion of such an autonomous mandate for social rights would allow to better articulate economic and social concerns in cases of tensions.

In the meanwhile, existing tools of economic governance could be re-adjusted to make more space for genuine social priorities. In that sense, the social platform wisely suggested to use the infrastructures of the European Semester to counter the current trend pushing Member States to readjust wages downwards. The Commission could indeed support the introduction of references to adequate minimum wages in the Annual Growth Survey as well as in the Country Specific Recommendations and keep track of the development of wage levels. This would give more bite to the employment policy prong of the European Semester.

To that effect, it is important that Country Specific Recommendations continue to be adopted on the dual legal bases of Articles 121(2) (economic policy) and 148(4) TFUE (employment policy). Key players at European level are thus not only those in charge of economic and financial affairs but also those responsible for employment and social policy who are more likely to ensure that due attention is paid to employment and social concerns indeed. Mark Dawson has usefully observed that the involvement of the latest category of actors could be further enhanced in the Macroeconomic Imbalance Procedure (MIP; see M. Dawson, ‘The European Semester: Displacing Social Policy in the New ‘New Governance’’ in C. Kilpatrick (ed.) The Displacement of Social Europe (forthcoming). On file with the author).

Indeed, to the extent that this procedure does result in suggesting - if not imposing – changes in domestic social and employment policies as part of the Country Specific Recommendations, the decision-making process leading to their adoption shall be adjusted. This should allow for a stronger involvement of actors specialised in the field such as the Council configuration on Employment, Social Policy, Health and Consumer Affairs. For instance, see the Report from the Council Employment Committee and Social Protection Committee on ‘Assessment of the 2016 Country-specific Recommendations (CSRs) and the implementation of the 2015 CSRs’ on labour market aspects (p 10) and on social protection and inclusion (p 21).

Now, the Juncker Commission may be considering reserving, or enhancing, the emphasis on minimum pay (and income) in recommendations specific to Euro area members. Although we would regret a focus on Eurozone members only, if this approach was adopted it would be all the more so important to refer to Article 148 TFEU (employment policy) as a legal base besides Articles 136 (Eurozone) and 121(2) TFEU (economic policy) in order to ensure adequate representation of social players and interests.


The most concrete elements of information received during the Conference are unquestionably the announcements made by Commission President Juncker. Let us be clear, sending a message that the EU guarantees (directly or indirectly) minimum income and wages would be most welcome; and giving flesh to such guarantees through tools available in the context of EU economic governance is understandable. This however should be framed with appropriate conceptual and legal tools placing individual protection at the core of the process and, to that effect, it ought to be backed up with a solid effort to modernise the EU social acquis.

In that sense, it is to be hoped – as hinted at by President Juncker himself - that the initiative for the European Pillar of Social Rights will live up to the standards of the ambitious social agenda called for by Commission President Delors in the late 1990s. It may be recalled that this had resulted in the Proclamation by 11 out of the 12 Member states of the Community Charter of Fundamental Social Rights and came with a strong impulse for the adoption of new legislation (point 28 of that Charter). In the new EMU and enlargement context, the legislative focus should be on providing an updated and more comprehensive EU floor of social rights and should be accompanied by proposals to socialise the European Semester both in its process and its substance.

Barnard & Peers: chapter 20
Photo credit: Euranet Plus Inside

Friday, 17 March 2017

Faith at work: the CJEU’s headscarf rulings

Ronan McCrea*

* Senior Lecturer, UCL Faculty of Laws and author of Religion and the Public Order of the Euorpean Union (OUP 2010) and Religion et l’ordre juridique de l’Union européenne (Bruylant 2013).

Almost seventeen years on from the adoption of the Framework Directive on discrimination in employment, the Court of Justice has issued its first major decisions in relation to discrimination in employment on grounds of religion. In doing so the Court entered into territory that is extremely fraught in political terms and is therefore highly dangerous for an international court such as the CJEU.

The degree to which multi-faith societies can require individuals to refrain from expressing possibly controversial religious identities or beliefs in shared spaces such as the workplace has never been an easy question. But it has become significantly more difficult in recent years since the question of religion’s role in society has become bound up with highly combustible political issues such as migration, changing norms in relation to gender and sexuality, national identity and even national security.

It must therefore have been with considerable trepidation that the Court of Justice proceeded to give its ruling on two cases that involved challenges by two women who lost their jobs for refusing to remove the Islamic headscarves while at work.

The facts of the two cases were subtly, but importantly, different. In Achbita (Case C-157/15), the Claimant began working as a receptionist at G4S in February 2003 and complied with what was, at the time, an unwritten rule within G4S that workers could not wear visible signs of their political, philosophical or religious beliefs at work. In April 2006 Ms. Achbita informed her employers that she intended to wear an Islamic headscarf at work and was told that she could not do so because this violated G4S’s rule requiring philosophical and religous neutrality in their employees attire. In May 2006 G4S adopted a change to workplace rules making the ban on visible signs of political, philosophical or religous belief a written rule and in June 2006 Ms. Achbita was fired for her insistence on wearing the headscarf at work.

In Bougnaoui (Case C-188/15), the Claimant was informed by a representative of Micropole at an October 2007 student recruitment fair that wearing an Islamic headscarf may pose problems when she was in contact with customers. She began to work at Micropole in February 2008 initially wearing a bandana and then a headscarf. In May 2009, a customer of Micropole’s with whom Ms. Bouganoui had worked, informed her employers that Ms. Bouganoui’s wearing of the headscarf had upset some of their employees and requested that there be “no veil next time”. Ms. Bouganoui refused her employers request to confirm that she would agree not to wear the headscarf on future occasions and was fired in June 2009.

The Belgian and French Courts of Cassation both referred questions relating to the prohibition on discrimination in employment on grounds of religion or belief to the Court of Justice which, given their importance, decided to attribute both cases to the Grand Chamber.

In relation to Achbita the Belgian court asked  whether a ban on a female Muslim employee wearing the headscarf at work should be regarded as direct discrimination when the employer in question bans all employees from wearing any outward sign of political, philosophical or religious beliefs at work. This is potentially important as under the Directive, a directly discriminatory rule can only be justified by a “genuine and determining occupational requirement”. Indirectly discriminatory rules, on the other hand, can be accepted if it is shown that they serve a legitimate aim and are pursued by proportionate and necessary means.

In Bouganoui, the French court asked the Court of Justice whether the wish of an customer not to have services supplied by an employee in an Islamic headscarf could be seen as a genuine and determining occupational requirement under the Directive (seemingly assuming that the restriction in question was directly discriminatory).

Therefore, both claims focused on the issue of direct discrimination. However, in addition to ruling on the issue of direct discrimination, the Court of Justice decided to give significant guidance in relation to the question of justification of bans on religious symbols as indirectIy discriminatory measures.

In both cases, the Court noted that the Directive does not define religion but does refer to the rights contained in the European Convention of Human Rights which include the right to freedom of thought, conscience and religion in Article 9. It also notes the reference to the common constitutional traditions of the Member States which it notes were reaffirmed in the EU Charter of Fundamental Rights which includes a similar right in Article 10. Both of these rights include, the Court found, the right to manifest religious faith in public.

General Bans on Symbols of Opinion and Indirect Discrimination

However, in relation to Ms. Achbita, the Court found that the rule preventing her from wearing her headscarf at work did not amount to direct discrimination as it referred to visible signs of political, philosophical or religious beliefs and thus “covers any manifestation of such beliefs without distinction”. The Court therefore concluded that the rule “must (…) be regarded as treating all workers of the undertaking in the same way, by requiring them, in a general and undifferentiated way, inter alia, to dress neutrally, which precludes the wearing of such signs.”

Having answered the referring Court’s question as to whether the rule in question constituted direct discrimination in the negative, the Court decided to provide additional guidance as to how the national court, which has the authority to decide factual matters, should approach the issue of indirect discrimination. It did so on the basis that it was “not inconceivable”that the referring court might conclude that the rule in question was indirectly discriminatory in that it was “an apparently neutral obligation it encompasses results, in fact, in persons adhering to a particular religion or belief being put at a particular disadvantage” .

The guidance given provides significant illumination as to the approach of the Court to the reconciliation of religious freedom with rules that seek to constrain religious expression in particular contexts in multi-faith societies.

The Court, in common with the European Court of Human Rights in Eweida concluded that in principle, the desire, on the part of an employer to project an image of neutrality “must be considered legitimate”. It bolstered this conclusion with reference to the freedom to conduct a business under Article 16 of the Charter of Fundamental Rights of the EU which it feels weighs in favour of the employers’ rights in this regard “notably” when the rule covers only workers “who are required to come  into contact with the employer’s customers”.

However, the Court stressed that a rule restricting religious symbols or attire can only be seen to be appropriate when it is part of a neutrality policy that “is genuinely pursued in a consistent and systematic manner”. Whether this was the case in relation to Ms. Achbita, was, the CJEU ruled for the national court to decide on the facts.

Despite its emphasis on the role of the national court in applying the Court of Justice’s guidance to the case, the judgment gave a notably strong steer to the national judges concluding that if it were the case that the prohibition covered “only G4S workers who interact with customers (…) the prohibition must be considered strictly necessary for the purpose of achieving the aim pursued” though it did note that the national court must assess wehther it would have been possible to find Ms. Achbita a non-customer-facing role.

The judgment in respect of Ms. Bouganoui took as similar approach. The Court stated that a generally applicable ban on all visible symbols of religious, philosophical or political belief would be indirectly discriminatory and referred explicitly to the guidance given in Achbita for the assessment of the legitimacy, proportionality and necessity of such a ban.

The Court said it was for the national court to decide if Ms. Bouganoui’s dismissal was based on non-compliance with such a general ban. If the decision to dismiss was not based on a general ban but was specific to the headscarf, then it would be necessary to answer the question posed by the national court, namely, whether compliance with a request from a client that the employee refrain from wearing an Islamic headscarf at work could be seen as a “genuine and determining occupational requirement” that could justify a directly discriminatory policy.

On this matter, the Court gave a clear answer. It noted that only in very limited circumstances can characteristic related to religion constitute a genuine and determining occupational requirement. Compliance with a client request such as that made in this case did not meet the Directive’s requirement that a discriminatory rule be justified “by reason of the nature of the particular occupational activities concerned or of the context in which they are carried out”.

Significance of Client Preferences

There are a number of interesting features of the Court’s reasoning in these cases. There may appear to be something of a tension between the two rulings in relation to the role of customer preferences as a basis for the restriction of religious expression on the part of employees. On the one hand, in Achbita, the Court appears to say that the need of the employer to present a neutral image to clients makes it more justifiable to impose a neutrality requirement on employees with customer-facing roles. On the other hand, in Bouganoui, the Court found that compliance with a client’s request for “no veil next time” could not be seen as a “genuine and determining occupational requirement”.

However, to see a conflict here is to misunderstand the Court’s reasoning. In its discussion of the significance of customer-facing roles in Achbita, the Court was focusing on justification of an indirectly discriminatory general ban on all religious, political and philosophical symbols and assessing whether such a general ban would meet the conditions of proportionality, legitimacy and necessity required by the Directive in order to justify such indirectly discriminatory measures.

In contrast, in Bouganoui, the Court was assessing justification of a directly discriminatory criterion, namely the client’s request for “no veil next time”. In other words, the fact that the client in Bouganoui made a request that appeared to target the symbols of a particular faith rather than seeking a general ban on all religious, philosophical and political symbols, made compliance with this request a matter of direct not indirect discrimination. As the test for justification of directly discriminatory measures (“genuine and determining occuptational requirement”) is so much more demanding than that for indirectly discriminatory measures, the reasons for the apparent contrast in outcomes in the two cases becomes clear. Customer preferences may be sufficient to justify an indirectly discriminatory measure but cannot justify a directly discriminatory one.

The focus on the question of whether an employee has a customer-facing role in Achbita is also raises the question of the permissibility of dress-code restrictions for those without customer-facing duties. The Court was clear that interaction with customers was a factor that increased the scope for an employer to require an employee to obey a general and systematic ban on symbols of religious, political or philosophical belief. It is unclear whether this means that it is impermissible to impose such constraints on employees without customer facing roles. Given the controversial nature of many religious and other beliefs, it is conceivable that employers will aim to preserve workplace harmony between employees by imposing bans on symbols of belief at work. Indeed, in the well-known case of Ladele, the objection to accommodating a registrar who refused to carry out same sex civil partnerships came not from any clients but from her fellow employees.

Definition of Religion for Purposes of Discrimination

The fact that the Court relied to a significant degree on the definition of religion in the Article 9 jurisprudence of the European Court of Human Rights did not pose problems in this case. However, there is a certain tension between the right to freedom of religion and belief and the idea of indirect discrimination on grounds of religion. The right to freedom of religion or belief has (rightly) been regarded by the courts as primarily an individual right that allows individuals to choose their beliefs and which does not distinguish between widely shared established beliefs and idiosyncratic or heterodox beliefs and does not favour religious over non-religious forms of belief.

Indirect discrimination on the other hand, has generally involved notions of collective disadvantage and the granting of extra rights to individuals who show they are part of a group facing additional “head-winds” on account of a salient characteristic shared with other members of that identifable group. An individual with a belief shared by no one else may not be able to demonstrate such collective disadvantage (see for example the approach of the English and Welsh Court of Appeal in Eweida to indirect discrimination on grounds of religion in Directive 2000/78). Thus, the individualistic approach to religion that is appropriate in relation to cases focusing on religious freedom may not always be appropriate in relation to questions of indirect discrimination on grounds of religion where group disadvantage will be part of the analysis. Therefore, the CJEU’s approach of relying on the definition of religion used in fundamental rights litigation in relation to anti-discrimination cases may cause problems in the future (see R. McCrea “Singing from the Same Hymn Sheet? What the Differences between the Strasbourg and Luxembourg Courts Tell Us about Religious Freedom, Non-Discrimination and the Secular State” Oxford Journal of Law and Religion (2016) 5(2) 183-210).


Given the political salience of the issues underlying these cases, the fact that the Court of Justice has adopted a cautious approach is not surprising. There is no consensus in Europe about how best to approach the issue of religion’s role in public life in the context of religous and demographic change. Various countries have tried different approaches. Some countries, such as the UK, have felt it best to allow religious expression in a wide range of public contexts. Others, such as France, have taken the opposite approach and have pursued a policy that sees coexistence as best served by a degree of reticence in relation to religious expression in non-private contexts. Each approach has its critics. Many French people see the approach adopted in France as overly restrictive, just as many British people argue that cohesion and coexistence have not been well served by the UK’s approach. Other states like the Netherlands have switched to some degree from one approach to the other.

In addition, the status of religion, and the issue of whether religious belief should be regarded as being “special” in the sense of being entitled to a greater level of protection than is provided to other forms of belief, is a question that has a significant impact on issues of fundamental rights (where religious freedom can come often at the cost of the rights of others) and constitutional law, where the idea of religion as a private and individual matter is woven into the constitutional norms of a number of European states.

Therefore, it is unsurpising that the Court of Justice has been cautious in its approach. As I wrote previously on this blog, regulating religion’s role in public life is difficult because religion is both a matter of identity (akin to race) and a matter of belief (akin to political opinion). If one views religion as a set of beliefs this calls out for treatment that is entirely contrary to the treatment that would be appropriate if religion is regarded as a form of identity. Different approaches are appropriate in different scenarios. In relation to blasphemy or anti-apostacy laws, it is probably best to see religion as a set of beliefs, in relation to the right to receive services in a shop, it is probably best to see it as a form of identity. In relation to the workplace, there are good reasons for both approaches so it is appropriate that a degree of leeway is allowed, provided that restrictions are applied in a fair and balanced manner.

However, the story of the judgments in Achbita and Bouganoui is not a story of simple deference on the part of the European Court. While the Court of Justice has upheld the compatibility of rules prohibiting the wearing of religious symbols at work with the Directive it has, at the same time taken steps to ensure that such rules do not become a means to target adherents to minority or unpopular faiths. Rules restricting religious influence over law and politics or limiting religous expression in public contexts that were enacted in good faith have sometimes become the subject of exploitation in bad faith by some with exlusionary agendas. The Front National in France, for example, has in recent years, discovered a fervent love for laïcité that it did not have before they discovered that it could be used as a stick with which to beat French Muslims.

I have written before (Religion and the Public Order of the European Union, chapters 6 and 7, OUP 2010) about how the legal and political order of the European Union has tended to percieve more readily threats to secular law and politics and to egalitarian values when they come from minority faiths than when they come from culturally-entrenched forms of Christianity. This does not mean that restrictions on religion in politics or public life ought to go, often they serve important goals. But it does mean that it is important to ensure that such restrictions are applied fairly. The Court of Justice has taken an important step in these cases in this regard. By insisting that bans on religious symbols can be justified only if part of a genuinely systematic and generally applicable prohibition on the display of visible symbols of all kinds of religious, philosophical or political belief, the Court has sought to ensure that the often justifiable desire to curtail expression of controversial beliefs in the workplace cannot be used as a means to selectively target unpopular minorities.

This is an approach that will leave some unsatisfied. It gives employers significant control over the appearance of employees. In addition, what is seen as neutral is culturally specific and so compliance with neutral rules will be more difficult for adherents to minority faiths. However, as noted above, such rules can serve important goals and national courts will still be able to assess in each case whether the operation of the rules in question is proportionate. In any event, it is not clear that any other option was open to the Court of Justice. There are good arguments for and against allowing religous symbols at work and what is fair and appropriate in one context may be unfair an oppressive in another. Sweeping away all workplace rules accross 28 Member States that imposed a general ban on visible expressions of belief and opinion would represent a striking degree of certainty for an international court and would have risked placing the Union on a constitutional collision course with at least one major Member State. The solution of recognising the legitimacy of general bans but requiring that such bans avoid targetting specific faiths seems like a reasonable one.

Barnard & Peers: chapter 9, chapter 20

Photo credit: nathuLAW

Tuesday, 14 March 2017

Headscarf bans at work: explaining the ECJ rulings

Professor Steve Peers

When can employers ban their staff from wearing headscarves? Today’s rulings of the ECJ have attracted a lot of attention, some of it confused. There have been previous posts on this blog about the background to the cases, and about the non-binding opinions of Advocates-General, and there will hopefully be further more analytical pieces about today’s judgments to come. But this post is a short explanation of the rulings to clear up any confusion.


The EU has long had laws on sex discrimination, and discrimination regarding EU citizens on grounds of nationality. Since 2000, it has also had laws against race discrimination and also a ‘framework directive’ against discrimination at work on grounds of disability, age, sexual orientation or religion. The ECJ has often been called upon to rule on the first three of those grounds, but today’s two judgments (G4S v Achbita and Bougnaoui) are the first time it has been asked to rule on non-discrimination at work on religious grounds.

EU law does not generally apply to other aspects of religion, except that EU law on asylum applies to people who have been persecuted on religious grounds. So today’s judgments are not relevant as regards regulating religion in education, for instance.

It should also be noted that the European Convention on Human Rights (ECHR) protects the freedom of religion.  The European Court of Human Rights – a separate body – has previously ruled on how that freedom applies in the workplace, concluding that in some cases employers must allow employees who wish to wear religious symbols (see Eweida v UK, for example).

The rulings

The G4S ruling is the more significant of the two cases, in which the ECJ’s reasoning is most fully set out. First the Court rules that clothing worn for religious reasons is an aspect of religious belief. Then it concludes that there was no direct discrimination (ie discrimination purely on religious grounds) against Ms. Achbita, who was not allowed to wear a headscarf when dealing with customers, because her employer had a general ban on any employee display of religious or political belief.

Next, the ECJ ruled on whether there was any indirect discrimination (ie discrimination not on religious grounds, but which affected people of a particular religion more than others). Such discrimination can be ‘objectively justified by a legitimate aim…if the means of achieving that aim are appropriate and necessary.’ In the Court’s view, the national court which had asked the ECJ these questions should consider that an employer’s ‘neutrality’ policy regarding customers was ‘legitimate’, and was part of its ‘freedom to conduct a business’.

However, such as policy had to be ‘systematic’ and ‘undifferentiated’ as regards different beliefs. It also should be considered whether it was limited to those workers who ‘interact with customers’, and whether it would have been possible to reassign the employee to a different role without ‘visual contact’ with customers, without the employer taking on an extra burden.

In the second case, the Court ruled that employers could not discriminate due to a customer request that employees not wear a headscarf.  This was not ‘a genuine and determining occupational requirement’ that could justify reserving a job to those who did not wear headscarves.


The ECJ’s rulings must be applied by the two national courts that requested it to rule. They are also binding more generally on the courts of all 28 EU Member States.

In principle the rulings mean that employers may ban employees from wearing headscarves, but only in certain cases. First of all, the cases only concern customer-facing employees, on condition that the employer has a 'neutrality' policy. The ECJ was not asked to rule on other groups of employees, but its rulings indicate that it would be more difficult, if not impossible, to justify bans in those cases. Nor was it asked to clarify further what a ‘customer-facing’ employee is exactly.

A neutrality policy mean an employer also has to ban other religious or political symbols worn by customer-facing employees. So no kippas, no crucifixes, no turbans - and no icons of Richard Dawkins either. This could be rather awkward in light of the human rights case law referred to above, which says wearing crucifixes (for instance) is sometimes an aspect of an employee's right to manifest her freedom of religion.

There is a thin line between saying that employee headscarves can't be banned just because customers ask for it on the one hand, and allowing employers to ban such clothing in effect due to anticipation of customer reaction. In practice this might prove something of a legal fiction.

The bottom line is that today’s judgments do not constitute a 'workplace headscarf ban', but merely permit employers to establish such a ban – subject to limits which might prove difficult to comply with in practice.

Barnard & Peers: chapter 9, chapter 20

Photo credit: WeAretheCity

Scotland, the EU and ‘indyref2’: the legal issues

Professor Steve Peers

Yesterday, Scotland’s First Minister (Nicola Sturgeon) announced the Scottish Government’s wish to start the process of holding a second independence referendum, once the main elements of the UK’s final Brexit settlement was known. This follows the UK government’s rejection of alternative suggestions put forward by the Scottish government in relation to Brexit – which I previously discussed here.

Obviously any new independence referendum raises issues besides Scotland’s relations with the EU. But since the second referendum, if it goes ahead, will be more closely linked to issues of Scotland’s EU membership than the first one, it is a good moment to outline the main legal issues – and to address one specific point (on Scottish deficits as a membership criterion) in a little more detail. Of course, this blog might well be returning to these issues again in the months to come. (Some of the following is an updated version of my blog post from October 2016 on these issues.)

Scotland as an independent non-EU country

An independent Scotland might not be an EU Member State, at least initially, but rather have an association with the EU either as an interim step toward membership or indefinitely, in the event of political difficulties obtaining EU membership on either the Scotland or EU side (or both). An association with the EU might well be closer than the relationship between the remaining UK (rUK) and the EU – particularly in light of the UK government’s intention to leave the EU single market and customs union.

The most obvious route for Scotland to consider would be membership of the European Economic Area (EEA), along with Norway, Iceland and Liechtenstein. The EEA provides for participation of these non-EU countries in the EU’s single market freedoms and all the EU legislation related to them, as well as most EU employment and environmental law. But Scotland would not be covered by EU laws in other areas, notably agriculture, fisheries, tax and justice and home affairs – although, like Norway and Iceland, it could sign separate treaties with the EU on these issues. Although the current EEA countries have joined Schengen, this is a separate issue (agreed years after the EEA), and Scotland would have no legal obligation to do the same.

There would be no obligation to join the EU single currency (or any related constraints regarding deficits), and most significantly Scotland would be free to sign separate trade agreements with non-EU countries, because the EEA does not cover the EU’s customs union. This is particularly important because it means Scotland could seek to retain a closer economic relationship with the rUK than the rUK might have with the EU. Scotland could also “go global”, as Brexiteers say, by signing up to the free trade treaties already signed by members of the European Free Trade Area (EFTA: the EEA states plus Switzerland) with non-EU countries. (In principle, EFTA membership requires this). And it would retain power to sign its own treaties on top (or to seek to retain its own versions of the EU’s free trade deals with non-EU countries, as the rUK is likely to do). Scotland would have to become a separate WTO member, but could try to fast-track this by copying the rUK’s process of detaching from the EU’s WTO membership.

Is there a downside to EEA participation? Some have argued against the UK joining the EEA due to objections to single market participation, the need to accept ECJ jurisdiction, continued contributions, its undue size compared to other members, or its lack of influence over EU laws which would apply to it. Are these arguments transferable to Scotland? The first to third objections are not, since Scots voted to remain in the EU, entailing the single market, ECJ jurisdiction and budget contributions anyway. (In fact, the non-EU EEA countries are not subject to the jurisdiction of the ECJ, but a separate body called the EFTA Court: it usually follows ECJ case-law, but its decisions are not always binding. EEA financial contributions do not go straight to the EU budget, and would logically be recalculated in light of Scotland’s economic position anyway).

The fourth objection (size) is unconvincing: Scotland is broadly comparable with Norway, in particular in terms of population, location and economy. Finally, EEA states have a modest say on EU laws, being consulted on draft EU legislation and having the option to reject the application of new EU laws (although the EU might retaliate if they do that). Anyway, this is certainly more say over EU laws than Scotland would get after Brexit as part of the UK. In fact, it’s more say than Scotland gets over EU laws while the UK is an EU Member State – given the marginal influence that Scotland has over anything that the UK government does.

So the EEA option includes things that Scotland seeks (single market participation) while steering clear of things it may wish to avoid (the single currency and deficit criteria, Schengen, EU trade policy with non-EU countries, and EU fisheries policy).  It also has the advantage of being potentially far speedier than joining the EU: the EU can decide to apply treaties with non-EU countries provisionally, pending national ratification.

What about the prospect of a ‘Spanish veto’ over Scotland joining the EEA? Here we have actual evidence to suggest that it’s not very likely. For the EU has recently concluded an association agreement with Kosovo – despite Spain (and four other Member States) refusing to recognise the independence of that country after its unilateral declaration of independence. (Note: the EEA is also an association agreement, and Member States have a veto over the initial conclusion of such treaties).

Failing EEA membership, Scotland could still seek other forms of relations with the EU which may be closer than the rUK might enjoy, possibly as a non-EEA member of EFTA like Switzerland. Unless Scotland followed Turkey in joining the EU’s customs union, this would again leave it free to simultaneously retain a strong economic relationship with the rUK.

Scotland as an EU Member State

blogged on this issue in 2014, during the first Scottish referendum, but I’ll summarise and elaborate on those views again. The basic point is that the Treaties list the Member States by name, and since the ‘United Kingdom’ is unlikely to be interpreted as automatically referring to Scotland alone after independence, either an accession Treaty (Article 49 TEU) or a Treaty amendment (Article 48 TEU) is necessary to include Scotland’s name as a member.

The Treaty amendment route – which the Scottish government called for in the previous independence referendum – could also entail an amendment to Article 49 TEU, if necessary, to refer to the special case of Scotland: “By way of derogation from the above paragraphs, Scotland shall accede to the European Union pursuant to the Treaty of Culloden”.  One possibility is a Treaty amendment which simply replacing the words “United Kingdom” wherever it appears in the Treaties with “Scotland”; this would mean that Scotland retained the UK’s opt-outs from the single currency, justice and home affairs and Schengen (the budget rebate is set out in secondary legislation). This is perfectly feasible legally, and there is a firm precedent in the Treaty of Lisbon, which in Article 2(2) to 2(8) provides for a whole host of amendments just like this: replacing “Community” with “Union” wherever it appears, for instance.  

However, the EU position at present is that it will insist upon an accession process under Article 49. This would entail a negotiation process, which could possibly be fast-tracked in light of Scotland’s existing de facto EU membership as part of the UK. It should be noted that when Iceland applied to join the EU in 2010, the Commission’s opinion on accession took account of Iceland’s EEA membership, and indeed it was possible to close many negotiating chapters quickly, before Iceland withdrew its application in 2013. By contrast, only one out of 35 negotiating chapters has been closed with Turkey, after many years of talks.

Since unanimity of Member States is required in any event, some have argued that there is a risk of a Spanish veto of Scottish accession, because of concerns that Scotland obtaining easy EU membership would inflame separatist tensions in Spain or other countries. On the other hand, some have argued that these concerns are misplaced.

Another argument is that the EU might not be willing to talk to Scotland until it is fully independent – although it should be noted that the EU has relations with Kosovo (see above), even though not all Member States recognise that country legally.

This brings us to opt-outs. If the EU is not willing to extend the UK’s current opt-outs to Scotland, this would in principle mean full participation in the single currency and justice and home affairs policies, as well as the loss of Scotland’s share of the UK’s budget rebate to Scotland. Each issue is worth further discussion.

The rebate is set out in secondary EU legislation which usually is reviewed every seven years or so, and must be agreed unanimously. Scotland would therefore be in a position to refuse its consent on the next occasion unless a rebate were agreed.

As for justice and home affairs, a distinction must be made between general EU policies and those related to Schengen – the border-free area. On the latter point, there is already a protocol to the Treaties which guarantees the continuation of the ‘Common Travel Area’ between the UK and Ireland – which will continue to apply after Brexit. The details will have to be worked out, but the starting point legally is a requirement imposed upon the EU to protect the common travel area. Arguably this not only protects the Irish position concerning the Northern Ireland border in Brexit talks, but also the position of Scotland in potential accession talks. And whatever solution is found for the island of Ireland is therefore transposable to the (rather shorter) border between Scotland and England.

As regards other JHA issues, the UK already takes part in most civil and criminal law EU measures, and so Scotland’s participation will not change anything. It should be noted that Scotland would not have to take part in the planned European Public Prosecutor, as that body will be set up by means of ‘enhanced cooperation’ and new Member States do not have to participate in measures set up by that EU framework, which is a system allowing for the adoption of EU law by a group of willing Member States, allowing the unwilling Member States to stay out (see Article 20(4) TEU).

That brings us to the single currency – and the related issue of deficits. Scotland’s deficit upon independence is sometimes discussed as if it can be calculated with absolute certainty. This is false: the actual deficit in practice would depend upon the terms of Scotland’s arrangements with the rUK, including its share of rUK debt, as well as broader trade and economic developments, including what currency Scotland uses and the decisions on tax and spending which a Scottish government takes upon independence.

While new Member States have in principle an obligation to join the single currency, it must be noted that the EU does not attempt to enforce this obligation. Sweden has not joined since the currency was created in 1999; Poland, Hungary and the Czech Republic have not joined since 2004, when they acceded to the EU; and Romania, Bulgaria and Croatia have not joined either.

As for the deficit criteria, there is a requirement of 3% of GDP in order to join the single currency. But that is not a requirement to join the EU. Otherwise why have so many new Member States not simply joined the single currency soon after EU membership?

In any event, this is easily provable: the Commission’s monitoring report on Croatia joining the EU noted that it had 4% and 5% debts in the years just before joining the EU. But its membership was still approved.

Of course, a large deficit is going to cause a country other difficulties besides EU membership, and in the event of EU membership the rule is in principle that a country should aim for deficits less than 3% of GDP after joining. But this rule is not absolute and the EU has little means to enforce it: sanctions for breaching it can only be imposed upon Eurozone countries, and the EU has never imposed them anyway. There would be strict conditions imposed upon any bailout deal (if necessary), inside or outside the Eurozone – but that would also apply outside the EU, for countries that need a bailout from the IMF alone. Whether Scotland might have an unmanageable deficit is certainly an important issue – but it’s quite false to say that “it can’t join the EU unless its deficit is less than 3%”.

Photo credit: Daily Record

Barnard & Peers: chapter 27