Dealing with the Greening

Author: Ruben Houweling, Erasmus School of Law

The Covid-19 pandemic still dominated policy makers’ and political agendas in Europa in 2021. One might forget that in July 2021, the European Commission adopted a package of proposals to make the EU's climate, energy, land use, transport and taxation policies fit for reducing net greenhouse gas emissions by at least 55% by 2030, compared to 1990 levels. Achieving these emission reductions in the next decade is crucial to Europe becoming the world's first climate-neutral continent by 2050 and making the European Green Deal a reality.

At first glance, one might say this has nothing to do with employment law. But at second glance, one would beg to differ. The new EU Climate Law and commitments of Member States to the Paris Deal already affect employers and their employees. In The Netherlands, for instance, new legislation (Besluit activiteiten leefomgeving (Bal)) proposes to strongly reduce carbon dioxide in work related traffic. Employers are obliged to transfer to either ‘green transport’ or to use public transport or bicycles. This obligation affects contractual agreements between the employer and employee. It also raises the question whether or not ‘leaving a green foot print on this planet’ is a circumstance employers can use to alter labour conditions of workers. But also new regulations limiting emissions or requiring green production equipment or techniques can affect production systems in ways that impact working conditions, cause layoffs, or create downward pressure on labour costs.

Approaching climate change and the EU Green deal merely in such a way, labour law is reacting on external circumstances (layoffs, costs). The question is whether addressing climate change issues on the labour market from a strictly labour law perspective is helpful to solve the issues at stake. Doorey argues that labour law and environmental law should come together in a form of ‘Just Transition Law’ to adequately address the big issues and complex legal frameworks related to climate change.[1] I think we can, and should, add that competition law and collective bargaining law as well as social security law can easily be added to this ‘Just Transition Law’.

A recently Dutch case illustrates the complexity and need for such ‘Just Transition Law’. A coal-fired power station in the port of Rotterdam needs to close in order to meet the Dutch target of emission reduction. The owner, a hedge fund, will receive over EUR 212 million subsidy from the Dutch greening fund (Ministry of Economic Affairs). To receive this subsidy, a social plan must be agreed upon with trade unions. And this is where interesting questions arise. Can local authorities, such as the City of Rotterdam or the national government set the terms of this social plan? For instance, can they demand that workers will only receive a certain severance payment if they transfer from a coal industry to a more green industry (article 5 and 15 EU Charter of Fundamental Rights (no forced labour/free choice of work))? Can third parties like local authorities or environmental movements demand a seat at the collective bargaining table? And what if a subsidized workers pool is created in the port of Rotterdam to help transfer workers from downscaling ‘carbonized industries’ to upscaling ‘green industries, would EU competition law allow this or would this result in illegal state aid? Can Member States force employees to transfer to green markets in order to receive unemployment benefits?

I think this simple Dutch example shows that to realize the ambitious EU goals employment lawyers and labour market policymakers need to collaborate intensively with colleagues from other (legal) domains. And if it helps to call it ‘Just Transition Law’ to find a common denominator, let’s do so. Apart from that, firm leadership and coordination are needed. The first adopted Committee proposals are promising. At the same time, the lack of collectively addressing the Covid-19 pandemic in Europe, shows its weakness in fighting the same enemy without a united force. Let’s learn from this Covid-19 pandemic approach and join forces to combat the biggest challenge of this century. It’s a matter of time before all of us labour lawyers are dealing with the greening. So we might as well start right now.

[1] Doorey, David J., Just Transitions Law: Putting Labour Law to Work on Climate Change (March 21, 2017). (2017) 30(2) Journal of Environmental Law and Practice 201, Available at SSRN: https://ssrn.com/abstract=2938590