Social rights and economic freedoms can co-exist

Businessman hit by hammer

The Social Progress Protocol, proposed during the Conference on the Future of Europe (CoFoE), gives precedence to social, workers' and trade union rights when they are in conflict with economic freedoms. However, while everyone agreed that social rights and economic freedoms can co-exist, support for making the protocol primary EU law is far from unanimous, with diverging views among the social partners and in the academic community, an EESC hearing confirmed

On 14 March, the European Economic and Social Committee (EESC) held a hearing on the proposal for the Social Progress Protocol (SPP) which would prioritise fundamental rights over economic freedoms in the event of conflict and in EU policies. It discussed the calls to make the SPP an instrument on a par with the Treaties, in a bid to safeguard and strengthen the European social model.

The purpose of the hearing was to gather input for an exploratory opinion being prepared by the EESC at the request of the forthcoming Spanish presidency of the Council of the EU which asked the EESC for its take on the SPP.

Opening the hearing, the rapporteur for the EESC opinion, Mari Carmen Barrera said: The application of the SPP will guarantee progress in the social economy and uphold the principle of non-regression in social standards.  Enshrining the SPP in the Treaties will allow the EU to safeguard the European social model and promote economic freedoms, which will translate into the development of more robust and sustainable businesses.

The SPP aims to guarantee fundamental social rights and promote social progress by ensuring that the EU and Member States strive ceaselessly to improve people's working and living conditions. It also aims to ensure the autonomy of the social partners by regulating employment relationships, promoting the highest standards of social rights (regardless of whether they stem from national, European or international law) and safeguarding all existing social rights.

The goal is to clarify the hierarchy of norms between fundamental social rights and economic interests, strengthen European social policies, encourage the implementation of the European Pillar of Social Rights (EPSR) in the Member States and ensure non-circumvention of human and fundamental rights in EU law which can sometimes be in breach of international human rights and labour conventions.

The SPP was first proposed by the European Trade Union Confederation (ETUC) in 2008 in response to European Court of Justice rulings in favour of economic freedoms in the Viking and Laval cases. Last year, the SPP was mentioned in the CoFoE conclusions which called for the EU Treaties to be changed to make it a binding instrument in primary EU law.

Further to the CoFoE, in June 2022 the European Parliament adopted a resolution calling for the SPP to be incorporated into the TFEU. The European Commission will publish its response to the CoFoE conclusions in a few months.

We live at a time of major challenges to competitiveness, the markets and social models. We are talking about how we should respond to this in Europe without losing our European model which combines productivity, a modern approach, respect for the environment and the protection of social and labour rights, said Alejandro Abellán, from the future Spanish Presidency.

We are opposed to contradictions between economic freedoms and social rights. Before envisaging Treaty negotiations, we should work together on how to reinforce the social dimension of the EU. We have many tools for doing this, such as the EPSR, together with its Action Plan and review clause, said Denis Genton from the European Commission, adding that the Commission was committed to making full use of its right to initiative within due regard for its competences.

He also gave the example of the EPSR and the Youth Guarantee: these were not binding but were still delivering excellent results. The EPSR had drastically changed the balance between the economic and social dimensions of policies, whilst the Youth Guarantee had changed the lives of many young people.

The social partners did not agree on whether the SPP should be made a binding legal instrument, with trade unions calling for it to be included in the Treaties and employers' organisations arguing that the current legislation was quite sufficient to secure respect for fundamental social rights if implemented properly.

Labour is not a commodity and cannot be subjected to the same market forces as other production factors in the internal market. Workers' rights cannot be compromised for the lowest price or the highest profit in a Union striving for the constant improvement of working and living conditions as well as the well-being of its people, said ETUC Confederal Secretary, Isabelle Schömann.

She considered that making the SPP binding in all EU policy areas was imperative: this would ensure that "U legislation stops treating the protection of human rights as an obstacle to free trade and market integration. It should be clear that human rights apply to all human beings and cannot be set aside for economic interests.

Barbara Caracciolo of Solidar, a network of 60 national organisations working to advance social justice through just transition, said that it was crucial to include the SPP in the Treaties in order to create a social Europe and gain people's trust by giving European social policy a stronger legal basis and boosting the implementation of the Social Pillar.

Speculative interests are already being given priority over people's fundamental rights, including their right to have access to energy, said Ms Caracciolo. She added that the CoFoE conclusions and Eurobarometer data indicate that Europeans want more social spending and a stronger social Europe, with 78% of the people surveyed saying that governments, with the support of EU institutions, should take steps to reduce differences in income levels.

Maxime Cerutti of Business Europe said that balancing the social market economy is at the heart discussions on the SPP. Fundamental rights and economic freedoms currently have the same value and political recognition.

We need this balance; without it, we would not be in a social market economy but rather in a special social framework, said Mr Cerutti, adding that companies already have to abide by rules, social directives and fundamental rights in order to be able to operate in the markets.

The legal experts who took part in the hearing all agreed on the need to strengthen the EU's legal framework to ensure respect for fundamental social rights but disagreed on the need to change the Treaties to include the SPP. While some advocated for more robust implementation of the social directives (such as those on transparency and minimum wages), others said that it was paramount to make the SPP a binding instrument if it was to have any real effect.

Those in favour argued that a clear SPP, with the same legal force as regulations, could make a difference, especially in cases brought before the European Court of Justice. The SPP must be aligned with international labour law and the EU should use this opportunity to catch up and improve alignment with key regulations such as the European Social Charter, the European Convention on Human Rights and any ILO conventions.

With a number of major social challenges ahead, enshrining the SPP in the Treaties is needed to strengthen social cohesion. It is important to strike a balance between social and economic interests without compromising fundamental social rights. Just how we do so will be crucial.

The EESC opinion on the SPP will be put to the vote at the plenary session in June.