EFTA Court Ruling Against Norwegian Stevedores

The Court of Justice of the European Free Trade Association (EFTA Court) issued a historic ruling on April 19 regarding the incompatibility of the monopoly of Norwegian stevedores with European Union rules on free competition, free movement, and human rights.

The ruling assesses the legality of a boycott by Norwegian stevedore unions to force the company Holship Norge, owned by a Danish logistics and transport group, to accept the priority established by a collective agreement to employ stevedores supplied by the Port Work Administration (PWA) at the Norwegian port of Drammen.

All permanent workers at the mentioned port belong to a PWA that manages the work shifts of stevedores and also provides a series of salary and labor benefits to its members. If Holship were part of the collective agreement, it would be obliged to respect the priority of port workers employed by the PWA in port operations, with the same wages established by the PWA, to the detriment of the company's own workers.

Stevedores registered in 14 other Norwegian ports benefit from the same priority system for hiring in loading and unloading ships. Consequently, the regime of stevedores in Norway can be considered a classic example of a restrictive stevedore “pool” system.

In a preliminary ruling, issued at the request of the Supreme Court of Norway, the EFTA Court has established, among other considerations, that the mentioned collective agreement exceeds its objectives and that any agency employing stevedores must, in any case, be subject to competition rules, particularly regarding abuse of dominant market position.

It also establishes that the described “pool” system is contrary to the freedom of establishment, as it only protects a limited group of workers to the detriment of others, and their employment as stevedores is contingent upon their affiliation with a union.

This ruling from the EFTA Court significantly reinforces the effect of previous rulings from the EU Court of Justice and national courts, which declared that classic “pool” systems in ports are contrary to the fundamental principles of the EU Treaty.

To these rulings, it adds the explicit confirmation that collective agreements of stevedore “pools” must be subject to competition rules; it emphasizes the employment rights of workers who are not part of the “pool” and recognizes the fundamental freedom of workers not to affiliate with a stevedore union.

This ruling also confirms the results of a study on port labor in the EU conducted in 2013 by Eric van Hooydonk for the European Commission and provides additional support for the Commission's actions against Belgium and Spain, which have yet to reform their port labor systems.

The aforementioned Court is a supranational judicial body responsible for the three EFTA members that are also members of the European Economic Area (EEA): Iceland, Liechtenstein, and Norway. It applies the same fundamental principles as the European Court of Justice, which interprets the Treaty on the Functioning of the European Union. Thus, the rulings of the EFTA Court carry considerable authority within the EU.

Photo: Holship Norge