University of Groningen

Posted work and deterritorialization in the European UnionWagner, Ines

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Citation for published version (APA):Wagner, I. (2015). Posted work and deterritorialization in the European Union: a study of the Germanconstruction and meat industry. Groningen: University of Groningen, SOM research school.

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Publisher: University of Groningen Groningen, the Netherlands Printed by: PrintPartners Ipskamp B.V. ISBN: 978-90-367-7493-2 eISBN: 978-90-367-7491-8 Copyright 2014 © Ines Alisa Wagner

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Posted Work and Deterritorialization in the

European Union A study of the German Construction and Meat Industry

PhD thesis

to obtain the degree of PhD at the University of Groningen

on the authority of the Rector Magnificus Prof. E. Sterken

and in accordance with the decision by the College of Deans.

This thesis will be defended in public on

Thursday 05 February 2015 at 12.45 hours

by

Ines Alisa Wagner born on 07 February 1984

in Bad Homburg v. d. Höhe., Germany

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Supervisor

Prof. S. Beugelsdijk

Co-supervisor

Dr. N.A. Lillie

Assessment committee

Prof. M. Houwerzijl

Prof. G. Jackson

Prof. N. Kauppi

Prof. J. Steen Knudsen

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This dissertation is lovingly dedicated to the memory of my mother, Olga Wagner.

Diese Dissertation ist in liebevollem Andenken meiner Mutter, Olga Wagner, gewidmet.

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ABSTRACT In the European Union worker posting has become a standard way for firms to reduce wage costs. ‘Posted workers’ are a type of labour migrant sent by their employer to work temporarily in another EU member state. Their labour, employment and social security rights are embedded in both the sending and the host countries. This inhibits effective regulation of labour markets and labour relations within insular political economies. The regulatory capacity of states is deterritorialized. At the same time, the transnational flexibilisation of employment relations increases. This study will explore the interrelationship between transformations of labour markets and nation states in the EU, two trends that are embodied in the posting relationship. The workplace-level focus reveals how posting actors redefine the posting regulatory framework, and conversely how the effects of EU integration impact industrial relations practices and labour market regulation. The aim is to decipher the current labour market structure and dynamics of change in transnational workspaces in a pan-European labour market. I focus on two industries in Germany, the construction and meat industries, because of the prevalence of posted work in them.

The bottom-up case study data supports four main findings. First, transnational subcontracting allows the emergence of different regulatory spaces at the national and workplace levels. Second, it opens exit options for capital but constrains voice options of unions, works councils and mobile workers. Third, transnational workspaces also create opportunities for transnational action; however, these opportunities take other forms than those usually expected within the German political economy. Fourth, borders in the EU are not abolished, but shift and are activated by mobility practices. In order to decipher the current structure of the pan-European labour market it is necessary to relate the shift in state borders to the shift in firm borders, since these transformations create a differentiated system of rights for mobile workers. Although posted work is a particularly complex policy field, labour migration as such is regarded as a decisive field where the profile of mid-21st-century Europe will be forged (Pries 2001).

Keywords: European integration, labour mobility, institutional change, Germany

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ACKNOWLEDGEMENTS

It has been a privilege and pleasure to do my PhD research as part of the ERC

project ♯263782 Transnational Work and the Evolution of Sovereignty. This project

created the infrastructure for me to do this particular field work, created the

opportunity for me to present my work at international conferences, to collaborate

and exchange with academics with similar research interests, and has greatly

contributed to my professional and personal development. I am humbled to have

met, and worked with so many inspiring, knowledgeable workers, practitioners

and academics.

I wish to express my gratitude to Nathan Lillie, one of my supervisors and the

principal investigator of Transnational Work and the Evolution of Sovereignty. Nathan,

thank you for your continuous support, trust and encouragement. You have given

me the freedom to creatively develop my own thoughts, view and voice in

academic debates. My deep appreciation also goes out to Sjoerd Beugelsdijk, my

supervisor at the University of Groningen and to Marja Keränen, my co-supervisor

at the University of Jyväskylä. Sjoerd, your thorough reading and comments on the

structure and contextualisation of the research have greatly contributed to the

development of this dissertation. Marja, thank you for carefully reading all the

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drafts of my chapters and for constructive discussions about my work, which has

aided in sharpening my arguments.

For this dissertation I would like to thank my reading committee members: Niilo

Kauppi, Jette Steen Knudsen, Gregory Jackson and Mijke Houwerzijl for their time,

interest, and helpful comments.

A very special thanks goes out to all the interviewees. In spite of the barriers of

conducting research on a politically sensitive topic, I was able to interview various

people involved in the posting relationship: posted workers, native workers

working with posted workers, volunteers, activists, trade unionists, works

councillors, community members, managers and government and EU officials.

Due to the politically sensitive nature of the research I am grateful to the

interviewees who shared their insights on posted work. Out of consideration for

their anonymity, I am sorry I cannot give recognition to some of those who helped

me most. Without them, this work would obviously not have been possible.

Furthermore, I would like to extend my thanks to the interpreters, translators and

transcribers who aided me in the development of the interviews: Aleksandra Koch,

Anna Grygiel, Mateusz Dymarek, Anna Siwiec-Glab, Adam Gaik, Tijana

Milunovic, Kamila Meyer, Anca Gabriela Lelutiu, Judith Schneider and Julia

Schlüter.

I want to extend my thanks to the research team of the project Transnational Work

and the Evolution of Sovereignty and of the project Industrial Citizenship and Labour

mobility in the EU. Thanks are due to Lisa Berntsen, Erka Caro, Sonila Danaj, Laura

Mankki and Markku Sippola for creating such a pleasant working environment.

Lisa deserves a special thanks. We started our PhD projects at the same time, and

got to know PhD student life together including the ups and downs that are part of

it. Lisa, I very much appreciate the ways in which we have exchanged views on a

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wide variety of interesting topics; it was a pleasure. I am looking forward to our

continuous collaboration and friendship in the future.

I would like to thank my colleagues at the University of Groningen at the

Department of Global Economics and Management and at the University of

Jyväskylä at the Department of Political Science for providing me with a pleasant

working environment. Thanks are due to Miriam Wilhelm, Marjolein Onrust,

Dimitris Soudis, Katja Mäkinen, Anu Kettunen and Marko Nousiainen for

interesting discussions and feedback. I sincerely thank the members of the SOM

Research Institute for their kind assistance and support. These include Ellen

Nienhuis, Rina Koning and Arthur deBoer. At the University of Jyväskylä I would

like to thank Tarja Etelälahti, Tiina Hokkanen and Sari Korkia-aho for continuous

support.

I would also like to thank all the people and institutions that facilitated and

supported my guest research stays in Germany. I want to thank the Max-Planck

Institute for the Study of Societies in Cologne. Thanks go out to the research group

Political Economy of European Integration, and in particular to Martin Höpner,

Benjamin Werner and Martin Seeliger. I have greatly benefitted from productive

discussions and comments on my work. Many thanks also to Chiara Benassi and

Inga Rademacher who have made my stay at the MPI much more pleasant.

I would also like to offer my thanks to the WSI within the Hans-Boeckler Stiftung

for their kind Gastfreundschaft during the time I spent at the institute. Thanks are

due to Brigitte Unger, Christiane Borsch, Karin Schulze Buschoff, Jutta Höhne,

Nadine Absenger, Thorsten Schulten, Martin Behrens, Reinhard Bispinck,

Christina Klenner, Birgit Kraemer, Elke Ahlers, Yvonne Lott, Dorothee Spannagel,

Daniel Seikel, Florian Blank and Phillipp Klages. I enjoyed and benefitted not only

from my research stay at the institute but also from the WSI summer school in

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Berlin in 2012. I want to thank my fellow ‘WSI summer schoolers’ Lisa Dorigatti,

Chiara Benassi, Nadja Doerflinger and Jenny Auffenberg for making academic

conferences not only intellectually stimulating but also fun.

A lot of people provided insightful comments on the chapters during different

draft stages. In no particular order I would like to thank Virginia Doellgast, Ian

Bruff, Matthias Ebenau, Andreas Nölke, Christian May, Miriam Kullmann, Martin

Behrens, Katja Mäkinen, Marko Nousiainen, Gregory Jackson, Maite Tapia, Martin

Seeliger, Benjamin Werner, Andreas Bieler, Roland Erne, Knut Kjeldstadli, Sabina

Stan as well as various anonymous reviewers. Support for travel and conference

organization was provided by the Economic and Social Research Institute within

the Hans Böckler Foundation, the Society for Advancement of Socio Economics,

The Centre for Advanced Study at the Norwegian Academy of Science and Letters,

the Society for Advancement of Management Studies, Assoziation für Kritische

Gesellschaftsforschung, the BISA International Political Economy Group, the

University of Jyväskylä, University of Groningen and the University of Duisburg-

Essen.

Finally, I want to thank my family for their never-ending encouragement and

belief in me. Diese Dissertation ist meiner wunderbaren Mutter gewidmet. Ohne ihre

Unterstützung und Ermutigung, ihre beständige Liebe und Vertrauen wäre diese

Dissertation niemals geschrieben worden. Papa, Oma und Opa, Danke für Eure große

Unterstützung und bedingungslose Liebe, die es mir ermöglicht haben, diesen Weg zu

gehen. Tanja, meine Schwester, Danke besonders für die emotionale und mentale

Unterstützung. Dein Rückhalt gibt mir Kraft und Vertrauen. Heartfelt thanks are also

due to Philip Fleischer, the Vermeulen family and the extended Wagner family

who all have been more than supportive and caring. Anne and Jan many thanks

for lending your support in various translation exercises. Samantha, thank you

very much for your excellent proofreading. Sincere thanks are due to all my

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dearest friends, old and new, but in particular to Solveig, Lev, Hugo, Nan, Alex,

Julie, Robin, Charlotte, Mette, Claudia, Chrissi, Shikha, Koen and Simona.

Tim, my deepest gratitude goes to you, for always being there, patiently listening

to my endless ramblings about posted work, for waiting up late at night with a

warm cup of tea after exhausting field work trips, for critically reading my drafts

and supporting me in every possible way. Most of all, thank you for the wondrous

life outside of academia full of love and laughter. I am looking forward to our next

adventures whatever they may be!

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CONTENTS

ABSTRACT  ...................................................................................................................................  5  

1.   INTRODUCTION & BACKGROUND  ....................................................................  15  1.1   Introduction ............................................................................................................. 15  1.2   Posted work in the EU and how it is regulated ................................................. 19  

1.2.1   Operationalizing ‘Posted Work’  ..............................................................................................  20  1.3   Posted work and the impact of Eastern European accession ......................... 21  1.4   The role of the ECJ and the ‘clash of capitalisms’ ............................................ 24  1.5   Deterritorialization and institutional change in transnational workspaces26  

1.5.1   The usage of rules in transnational workspaces  .............................................................  27  1.5.2   Exit, voice and labour market dualisation in transnational workspaces  ............  29  1.5.3   The possibilities of resistance  ....................................................................................................  31  1.5.4   Mapping the pan-European labour market: Borders and institutional  ..............  33  systems  ..................................................................................................................................................................  33  

1.6   The German regulatory framework for worker posting ................................ 36  1.7   The structure of this thesis ................................................................................... 40  

2.   METHODOLOGY  ...........................................................................................................  42  2.1   The approach ........................................................................................................... 42  2.2   Data collection ........................................................................................................ 45  

2.2.1   Industry and workplace case study selection  ...................................................................  47  2.2.2   Interview guides and interviews ...................................................................... 48  

2.2.3   Gaining access to posted workers  ..........................................................................................  50  2.2.4   Interviews with transnational posted workers  ................................................................  51  2.2.5   Use of interpreters  ..........................................................................................................................  54  2.2.6   Native workers  .................................................................................................................................  55  2.2.7   Primary sources  ...............................................................................................................................  56  2.2.8   Participant observation and field notes  ...............................................................................  56  

2.3   Analysis .................................................................................................................... 57  

3.   RULE ENACTMENT IN A PAN-EUROPEAN  LABOUR MARKET: TRANSNATIONAL POSTED WORK IN THE GERMAN CONSTRUCTION SECTOR  .......................................................................................................................................  62  3.1   Introduction ............................................................................................................. 62  3.2   Posted work in the German construction sector .............................................. 65  3.3   Research methods ................................................................................................... 68  3.4   Micro-level rule enactment .................................................................................. 70  

3.4.1   Management Practices  ..................................................................................................................  70  3.4.2   Posted workers’ perceptions  .....................................................................................................  73  3.4.3   Union strategy and rule enforcement  ...................................................................................  74  

3.5   The possibilities for institutional change through rule enactment at the micro level ............................................................................................................... 76  3.6   Conclusion ............................................................................................................... 80  

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4.   EUROPEAN INTEGRATION AND THE  DISEMBEDDING OF LABOUR MARKET REGULATION: TRANSNATIONAL LABOUR RELATIONS AT THE EUROPEAN CENTRAL BANK CONSTRUCTION SITE  ..........................................  85  4.1   Introduction ............................................................................................................. 85  4.2   Methods and case selection .................................................................................. 88  4.3   Organised capitalism, territorial cohesion and collective goods .................. 88  4.4   Mechanisms for opening the European space .................................................. 91  4.5   German industrial relations ................................................................................. 93  4.6   The European Central Bank Construction Project ........................................... 96  

4.6.1   Voice Mechanisms for Posted Workers  ...............................................................................  99  4.6.2   Working in Spaces of Exception  ...........................................................................................  102  

4.7   Discussion .............................................................................................................. 103  4.8   Conclusions ........................................................................................................... 105  

5.   EU POSTED WORK AND TRANSNATIONAL  ACTION IN THE GERMAN MEAT INDUSTRY  ................................................................................................................  108  5.1   Introduction ........................................................................................................... 108  5.2   De- and reterritorialization in the context of EU worker posting ............... 111  5.3   Research methods ................................................................................................. 115  5.4   Transnational action in the German meat industry ...................................... 116  

5.4.1   Power relations in transnational workspaces  ................................................................  118  5.4.2   A ‘moment’ of transnational action  ....................................................................................  119  5.4.3   From the local to the national  ................................................................................................  123  

5.5   Discussion .............................................................................................................. 125  5.6   Conclusion ............................................................................................................. 130   6. THE POLITICAL ECONOMY OF BORDERS IN A BORDERLESS EUROPEAN LABOUR MARKET................................................................................132 6.1   Introduction ........................................................................................................... 133  6.2   The spatial reconstruction of EU labour market regulation ........................ 135  6.3   Research methods ................................................................................................. 140  6.4   Bordering practices in transnational workspaces .......................................... 141  

6.4.1   Borders to regulatory enforcement  .....................................................................................  141  6.4.2   Firm borders  ...................................................................................................................................  145  

6.5   The implication of the spatial reconfiguration of employment relations for trade unions and posted workers ...................................................................... 148  6.6   Mapping the shape of the pan-European labour market ............................. 150  

7.   CONCLUSION  ..............................................................................................................  156  7.1   Introduction ........................................................................................................... 156  7.2   The Enforcement Directive of the Posting of Workers Directive ............... 159  7.3   Practical and utopian considerations on how to proceed ............................. 162  7.4   Implications, future research and industrial and global patterns .............. 165  

Annex I  ......................................................................................................................................  169  

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BIBLIOGRAPHY  ...................................................................................................................  171  

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ARTICLES ARTICLE I Wagner, I. (2014) Posted Work and Rule Enactment in the

German Construction Sector. British Journal of Industrial Relations. doi: 10.1111/bjir.12053

ARTICLE II Wagner, I. and Lillie, N. 2014. Deterritorialization of Sovereignty and the Disembedding of Labour Market Regulation: Transnational Labour Relations at the European Central Bank Construction Site. Journal of Common Market Studies 52 (2): 403–419.

ARTICLE III Wagner, I. EU posted work and transnational action in the German meat industry. Transfer: European Review of Labour and Research as part of the special issue ‘European Collective Action in Times of Crisis’. Accepted and forthcoming 2015-2.

ARTICLE IV Wagner, I. The political economy of borders in a borderless European labour market. Submitted to Journal of Common Market Studies (Revise and Resubmit).