In December last year, the ECJ dismissed the two countries’ lawsuit for annulment. Hungary and Poland both brought a lawsuit for annulment against the Posted Workers Directive 2018/957 on the grounds that, inter alia, the choice of legal basis was erroneous and the adoption of the Directive constituted a breach of Article 56 TFEU on the freedom to provide services and a breach of the Rome I Regulation. In its judgment, the Court dismissed both actions in their entirety.
The following arguments were put forward in support of the dismissal: ensuring the free movement of services under equal conditions of competition, a fair basis for ensuring that working and employment conditions do not differ for posted workers compared to workers of the member state, and better protection for all workers.
The Court also emphasised that the legal basis was comprehensive. The EU citizen was able to rely on the same legal basis as for the adoption of Directive 96/71, more precisely on Art. 53 I and At. 62 TFEU, which allow, inter alia, the adoption of directives with the aim of facilitating the freedom to provide services.
The Court also rejected the plea that Directive 2018/957 eliminates the cost-based competitive advantage of some service providers in certain member states. Indeed, the Directive provides that a number of terms and conditions of employment (including remuneration) are binding on posted workers in the host Member State. However, the Directive does not affect other cost elements, such as productivity and efficiency, of companies.
The final rejection by the ECJ thus means that there are no further outstanding claims against the EU Posting of Workers Directive. It remains to be seen whether further lawsuits and rulings on the content of the Posted Workers Directive is going to follow.