EU Law
News, commentary and legal updates from Fisher & Phillips attorneys
who assist employers with cross border employment matters.

Potential Implications of Brexit

April 11, 2016 04:44
by Robert Fallah

Britain and the EU have traditionally had a distant relationship, with Britain often choosing to keep an arm’s length from its continental partners. This inclination may soon become a political reality when the UK votes on whether to stay in the EU this June. In spite of this historical distance, many labor and employment laws in the UK such as those relating to maternity and paternity leave, discrimination, and work time bear the imprimatur of EU directives. Given Britain’s history with the European Union, it might appear that if the UK leaves the EU, changes in this area of the law will be broad and swift. However, the reality is that despite grumbling of bureaucratic red tape from Brussels, many of these laws have become integrated into British life, and should a “Brexit” occur, changes are likely to be gradual and narrowly tailored.

If the UK votes to leave the EU, British courts will no longer be required to follow the rulings of the Court of Justice of the European Union (CJEU). While seemingly simple on its face, complications are likely to arise. For example, it is unclear how British courts would be expected to interpret domestic law based on EU law while the UK plans its departure. It is much more likely that the British government will maintain the status quo, at least in the short term, in order to avoid uncertainty. With negotiations for the UK’s exit from the EU likely to take some time, affected areas of employment law are unlikely to see much change.

Taking the long view, the impact on British law will largely depend on the parameters of the relationship between a non-member UK and the EU. If, for example, the UK were to remain part of the European Economic Area, little would change. It is more than likely however that whatever form a “Brexit” takes, the EU will require the UK to retain certain laws as part of any deal. What’s more, even if the UK returns to setting its own laws, it is unlikely that government or industry would allow major changes over night. EU labor and employment laws have become the norm, and it would be politically undesirable to initiate large scale changes such as adjusting the minimum wage.

Rather than major changes, expect to see rules simplified and streamlined. For instance, holiday pay might be re-structured such that employers no longer need to take into account overtime, commission, and other allowances when calculating holiday pay. Other areas of employment law may not change at all, or could even be reinforced. Laws prohibiting discrimination in the workplace for instance will remain in force, while maternity/paternity leave requirements may be reinforced or even expanded given the recent drive to become “the most family-friendly country” in Europe.

One area that may see significant change however would be freedom of employee movement throughout member states. One of the founding principles of the EU is the freedom of individuals to move among member states, allowing individuals to reside and work throughout the EU with relative ease. A Brexit could fundamentally restrict employee mobility into and out of Britain, adversely impacting the ability of employers to hire from Continental Europe.

In conclusion, while there will inevitably be changes in British law should a “Brexit” occur, the consequences are likely to be minor adjustments rather than large-scale overhauls. Whatever changes occur will likely take place over time as both employers and government navigate the new order.


EU Law | Britain

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Doing Business in Ireland

May 29, 2012 03:55

If the Celtic Tiger roars again and  your company responds to the call, are you familiar with basic employment laws in Ireland?

Beginning in the 1970’s, the Republic of Ireland adjusted its business tax law for foreign investors and set out to establish itself as a hub for multinational businesses.  It succeeded well in that endeavor but then experienced the same economic downturn as most of the rest of the world in the late 80’s.  It appears that Ireland is attempting to come back economically through foreign investment once more.  As reported in The Irish Times on May 17, 2012, an organization called Startupbootcamp had, since January, hosted ten startups in an accelerator program in a warehouse in Dublin.  In mid-May, these startups each pitched their ideas – ranging from Opara, a Brazilian startup that developed a system to trace fruit and vegetables to Pombai, a US-China startup that created software that allows one to book travel abroad without knowing the local language – to one hundred investors from around the world who gathered for that purpose. 

According to IBM Venture Capital’s Martin Kelly, the ultimate goal of Startupbootcamp, with which he is affiliated, is to create in Dublin an international hub for startups.  The Irish Times quoted Kelly as saying, “My view is that it’s not really country versus country, it’s city versus city.  Why Dublin?  All the major multinationals are here.  It’s really well positioned between the US, Europe and Asia.  It’s easy to connect with people here; it’s big enough to be interesting yet small enough to move around.”
Since relaxing its tax laws in the mid-70’s to attract foreign businesses, Ireland has been successful in developing itself as a player on the multinational scene. 

Employment in Ireland is closely regulated through both national laws as well as EU Directives.  Some key features of Irish employment law, separate and apart from EU Directives, are described here.


The Equality Act 2004 and the Equality Act 1998 which it amends prohibit discrimination in employment based on gender, marital status, family status, age, race, religion, disability, sexual orientation and membership in the Traveller Community (the Traveller Community generally is a group of nomadic people of Irish ethnic origin who have their own traditions and language).  Amending the Equal Status Act 2000, the Equality Act expands the definition of sexual harassment  and places the burden of proof on the employer.

Leave Laws

The Parental Leave Act of 1998 as amended by the Parental Leave Act 2006 grants parents 14 weeks of unpaid time off per child to care for children (up to age 8) or disabled children (up to age 16) including paid leave in the event of serious family illness.  Parental leave may be taken in one continuous block of time or split into two blocks of time with a gap of at least 10 weeks between.  With employer consent, the leave time off may be broken down further.  Failure to return parents to work at the end of the leave constitutes an unfair dismissal. 

The Maternity Protection Act 1994 and its 2004 amendments provide time off for pre-natal classes, maternity leave, and breastfeeding (an hour each day).  Under a government-funded social welfare program, mothers are entitled to up to 26 weeks of paid maternity benefit, based on their regular earnings.
By statute, adoptive mothers have time off available in the form of a  work leave that  grants her the right to return to work at the conclusion of the leave.  Adoptive Leave Act 2005 amending Adoptive Leave Act 1995.

The Carer’s Leave Act 2001 provides for temporary, unpaid leave of up to 65 weeks to care personally for a relevant person as defined in the 2000 Act.

Protection of Employment

Under the Protection of Employees (Fixed Term Work) Act 2003, employees working for a fixed term cannot be treated less well than comparable permanent workers.  Employers are prohibited from endlessly renewing filed term contracts, after being on a fixed term contract, or series of fixed term contracts, for a total of four years, the employee is considered to have a permanent contract.  Part-time employees also have special protection under the Protection of Employees (Part-Time Work) Act of 2001 which prohibits discrimination against pert-time workers and requires that their schedules be set up to accommodate both them and the employer.

Ireland also has statutory protection for working youth (Protection of Young Persons (Employment) Act 1966 and has developed the Code of Practice for Protecting Persons Employed in Other People’s Homes.

Irish law protects employees from unfair dismissal under the Unfair Dismissals Act 1977-2007.  A dismissal is deemed unfair if it is undertaken in retaliation for an employee’s exercising rights under any of the protective statutes or leave laws.  Under this law, once the employee establishes that a dismissal occurred, it is incumbent on the employer to prove that it had fair grounds for the dismissal.  Fair grounds include proving that the employee was not capable (can be illustrated by lateness or absenteeism, so long as the absence was not a protected disability as recognized under employment equality law), not competent (to do the job for which s/he was hired after adequate notice and a final warning), not qualified (where the employee misrepresented qualifications at hire or failed to gain qualifications after being given time to do so), engaged in gross or ordinary misconduct, or was eliminated through a redundancy.


The Protection of Employment Act 1977 sets out conditions with which an employer must comply to eliminate one or more employees for redundancy.  For an employer to use redundancy as the reason for dismissal, it must be in a redundancy situation.  This includes a need to shut its doors for economic reasons, the need for employees in a certain category has ceased or diminished, there has been a management decision to carry on business with fewer staff, the employee(s) are not qualified to carry on work that will be done in a different manner going forward, or the work will be done by another worker who is qualified to do both jobs while the redundant worker is not equally qualified to do so.  To qualify as a collective redundancy the employer must be of a certain size and must dismiss a threshold number of employees given its size.  In the case of a collective redundancy, the company must give notice to the Minister for Enterprise, Trade and Employment in an effort to find redundant workers alternative employment.  Selection criteria must avoid violating any protective legislation and must be reasonable and fair.  Individual redundancies have no such special requirements (other than avoiding a charge of unfair dismissal), but employees are advised to consult with the redundant employee in an effort to help him or her find alternative employment.  Under the Redundancy Payments Acts 1967-2007, redundant employees may be entitled to minimum redundancy payments, based on length of service. 

EU Law | Ireland | Discrimination | Leave Laws | Protection of Employment | Redundancy

Revision of Schengen Agreement in the Offing? France and Italy Press for Changes to European Border Protocol

May 3, 2011 10:05
by James P. McLaughlin


Last week, French President Nicolas Sarkozy and Italian Prime Minister Silvio Berlusconi issued a joint letter to the European Commission (“EU”) demanding that the EU make an “in-depth revision” to the Schengen Agreement. 

         The Schengen Agreement, initially signed in 1985, essentially allows for passport-free travel within member states, which are collectively known as the Schengen Area.  Additional nations signed on to the accord in 1995 and Schengen became part of EU law with the signing of the 1999 Amsterdam Treaty. There are currently twenty-five nations – the twenty-two EU member states along with Iceland, Norway, and Switzerland -- participating in Schengen, with two additional nations scheduled to join in the near future.  Notably, because Schengen became part of EU law with the 1999 treaty, it can only be revised through the EU legislative process (rather than through amendment by its members).

        France and Italy’s concerted action arises after a series of disputes between the two nations over the treatment of a wave of immigrants from the North African nations currently experiencing political unrest.  Approximately 30,000 Tunisians nationals, most of them French-speaking, have recently fled to Italy.  Many of these Tunisians have attempted to travel from Italy into France, a step Italy initially encouraged by issuing visas allowing Tunisians to travel throughout the continent.  In response, France stepped up restrictions on its Italian border, including establishment of new checkpoints and making additional inquiries of entering Tunisians.  These anti-immigration efforts come on the heels of recent pushback from several EU nations on the inclusion of Bulgaria and Romania into the Schengen Area.  These two nations were originally scheduled to join in 2011 but their entry has been delayed. 

         The main thrust of the Franco-Italian request to re-examine Schengen is that the influx of North African immigrants is a special circumstance that warrants revision of the protocol.  However, the existing Schengen  Agreement already allows for the temporary establishment of borders in the event of national security concerns.  The EU has historically been reticent to utilize these powers for fear that regularly exercising this option could water down Schengen’s effectiveness and encourage attempts by member nations to close their borders.  Establishment of temporary borders has historically been limited to circumstances where one-time events have resulted in a huge inflow of individuals into a single country, such as the World Cup or similar events. 

           The EU will formally examine the request that Schengen be revised at a previously scheduled June summit of heads of government.


EU Law | Europe | Immigration


European Court of Justice Re-Affirms Principle That Communications Between Employees and In-House Lawyers Are Not Covered by Legal Professional Privilege

September 29, 2010 03:04
by James P. McLaughlin

In an opinion issued on September 14, 2010, the European Court of Justice ("ECJ") affirmed the principle of EU law that communications between in-house counsel and corporate employees are not protected by the legal professional privilege.

The judgment in the case entitled Azko Nobel Chemicals Ltd. and Akros Chemicals Ltd. v. Commission, Case C-550/07P, interpreted the long-standing rule, first enunciated in the 1982 AM & S v. Commission judgment, that the legal professional privilege does not cover communications between in-house counsel and corporate employees. See Case No. C-550/07P, 1982 E.C.R. 1575. By way of bri ef background, the Azko appeal arose from a ruling made as part of an investigation by the European Commission into suspected anti-competitive practices by Azko. In the course of the Commission's investigation, Azko was required to turn over two e-mail messages between its in-house competition lawyer and its general manager. Azko filed an appeal with the General Court contending that the e-mails were protected by the privilege; the General Court ruled in the Commission's favor, and A zko appealed to the ECJ, essentially asking the ECJ to re-examine the AM & S case.

The AM & S judgment held that communications between lawyers and client are generally privileged, subject to two caveats: (1) "that the exchange must be connect to &l squo;the client's right of defense", and (2) "that the exchange must emanate from ‘independent lawyers,' that is to say ‘lawyers who are not bound to the client by a relationship of employment," and applied the second caveat to exclude communications between in-house counsel and corporate employees. AM & S at ¶ 24, 27. Azko's appeal centered on two arguments seeking to establish that this application of the second caveat should be reconsidered: first, that a lawyer's "professional ethical obligations" are sufficient to establish his independence from his employer-client, and second, that there had been a "remaking" of the legal landscape among EU member states such that the application of the lawyer-client privilege to in-house counsel was now the norm among member states, and EU law shoud be revised to reflect this evolution of the law.

In rejecting Azko's arguments, the Court focused on the lack of independence which it found inherent in the employment relationship. The court noted that, despite the existence of professional ethical obligations, "an in-house lawyer cannot, whatever guarantees he has in the exercise of his profession, be treated the same way as an external lawyer, because he occupies the position of an employee which, by its very nature, does not allow him to ignore the commercial strategies pursed by his employer, and thereby affects his ability to exercise professional independence." ¶ 47 (emphasis added). The Court further rejected the idea that there had been a marked change in the laws of members states since the AM & S judgment, noting that "a comparative examination...shows that a large number of Member State still exclude correspondence with in-house lawyers from protection under legal professional privilege," and noting further that some Member State do not permit in-house lawyers to admitted to their state Bar or Law societies, a limitation that undercut Azko's argument that an in-house lawyer's professional ethical obligations create the "independence" from their corporate employers that the rule of AM & S requires. Azko at ¶ 72. Accordingly, the Court upheld the exclusion of AM & S.

Perhaps the most interesting question raised by the appeal, whether the privilege exclusion for in-house communications applies outside the context of an investigation by the Commission's sta ff, was left unanswered. This uncertainty presents a significant risk that communications between in-house lawyers and corporate employees in the EU are not privileged, especially in jurisdictions which do not by their own regulations protect such communications. It may be a best practice, then, for corporations doing business in the EU to engage outside counsel for sensitive communications that it suspects may later be subject to disclosure. Also left unanswered by the ECJ's judgment in the matter is whether communications between a European corporate representative and an in-house lawyer in a non-member state which takes a more stout view of the lawyer-client privilege, such as the U.S., would not be protected by the legal professional privilege. This, too, creates a potential trap for the unwary cross-border corporation.

Azko-Commission-10.14.2010.pdf (220.17 kb)


EU Law | Europe | Legal Professional Privilege



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