Abstract
The transition to an environmentally sustainable economy raises Herculean challenges for labour law. From a labour law perspective, perhaps the biggest question is the extent to which the environment is an interest that is and should be recognised and protected by labour law. Although the answer to this question is different for each national legal system, the influence of international and European law cannot be ignored. Starting from this assumption, the author analyses to what extent international and European law may influence the recognition of the environment as an interest of national labour law. To this end, the author analyses the overarching principles that characterise the interrelation between labour and the environment in the hard and soft law of the UN, ILO and EU. Subsequently, three areas of national labour law which may be influenced by the supranational framework are identified and discussed: job transition, work-related mobility of employees and remuneration. The author finds that the supranational framework provides arguments to assert that the environment has a place in labour law and is a legitimate interest in the balancing exercise between employer and employee. Nevertheless, a substantive place for labour law in the supranational framework seems lacking. The supranational framework is primarily concerned with compensating employees for the negative effects of the green transition and offers limited support for a broader integration of the environment into the employment relationship. Consequently, it makes few connections with labour law and contains few (hard or soft) obligations for both employers and employees. In the view of the author, this is a missed opportunity.
Keywords
Introduction
Sustainable development is originally understood to consist of three pillars: economic, social and environmental. 1 Although employment relationships and labour law are traditionally part of the social pillar, employers and employees are increasingly becoming aware that they have a role to play in addressing sustainability challenges related to the environmental pillar (combating climate change, restoring and enhancing biodiversity and creating a healthy, clean and safe living environment). For instance, employers introduce policies on how to implement working from home, reducing business travel by plane and encouraging the use of public transport for commuting. At the same time, an increasing number of employees care that their employers make green choices and try to stimulate green decision-making within the enterprise, for example through exercising the right to collective action. 2
From a labour law perspective, perhaps the biggest question is the extent to which addressing green sustainability challenges through labour is reconcilable with the foundations of labour law. The classic goal of labour law is to create balance between the contracting parties on the basis of their inequality. 3 In contrast, an environmental goal of the employer or the employee serves a more general, public purpose and cannot be linked to the employer-employee relationship one-on-one. For example, not every employee will consent to an employer's proposal to exchange a polluting company car for public transport compensation, and it is unclear whether labour law will allow the employer to take this decision unilaterally. In particular, it is doubtful what weight can be attached to the public interest of the environment when weighing the interests of the employer and the employee. It is thus uncertain if, and if so to what extent, the environment is an interest that is and should be recognised and protected by labour law.
Unsurprisingly, the answer to this question is different for each national legal system. 4 At the same time, this question cannot be answered solely on the basis of national law. Several international agreements and policy initiatives such as the Paris Agreement (2015) and the European Green Deal (2019) envisage a role for labour in realising the transition to an environmentally sustainable economy. Therefore, this contribution explores the question as to the extent to which international and European law may influence the recognition of the environment – despite its public connotation – as an interest of national labour law. To this end, it addresses the interrelation between the environment and labour in international and European law and explores how this interrelation may influence national labour law, such as the aforementioned doctrine of unilaterally amending employment conditions.
Due to their international status and endeavours with regard to sustainability, the United Nations (UN), the International Labour Organisation (ILO) and the European Union (EU) can be regarded as the key international players in the area of sustainable development. 5 The research is therefore conducted on the basis of the hard and soft law 6 on labour and the environment of these three institutions. The main sources of hard and soft law are taken as a starting point, complemented by supporting documents (such as complementary resolutions, communications and studies) and literature. The contribution is structured as follows. It commences with a brief overview of the relevant hard and soft law of the UN, ILO and EU (section 2). 7 Second, the overarching principles that characterise the interrelation between labour and the environment in the supranational sphere are analysed (section 3). On the basis of the analysis in the previous sections, I then identify and discuss three areas of national labour law which may be influenced by the supranational framework: job transition, work-related mobility of employees and remuneration (section 4). The contribution ends with a conclusion (section 5). Throughout the analysis, references are made to examples of national labour law. These examples are by no means comprehensive, but aim to illustrate the possible meaning of the supranational framework for national labour law.
The supranational legal framework
The UN, ILO and EU have previously issued multiple legal documents linking labour with the environment, highlighting their interconnections.
The UN
For the UN, the relevant hard and soft law firstly consists of treaties and declarations that target climate change and envisage a certain role for, or even centralise the position of, labour. The main document is the Paris Agreement, the legally binding international treaty on climate change that was adopted at the Climate Change Conference of the Parties (COP21) in Paris on 12 December 2015. 8 It entered into force on 4 November 2016. As is known, its overarching goal is to limit global warming to 1.5°C. The Preamble to the Paris Agreement takes into account ‘the imperatives of a just transition of the workforce and the creation of decent work and quality jobs’. This milestone reference expands on an earlier non-binding decision of 2010, in which the COP had determined that ‘a just transition of the workforce that creates decent work and quality jobs’ was a necessary feature of the ‘paradigm shift towards building a low-carbon society’. 9 Supplementary to the Paris Agreement the COP also adopted a work programme comprising the ‘Just transition of the workforce, and the creation of decent work and quality jobs’ in 2015. 10 Following the output from this work programme, 11 54 parties (governments, industry and social partners) adopted the non-binding Solidarity and Just Transition Silesia Declaration at COP24 in Katowice in 2018, including the European Commission on behalf of the EU and 21 EU Member States individually. 12 Then, at COP26 in Glasgow in 2021, 14 governments and the European Commission signed a follow-up Declaration on Supporting the Conditions for a Just Transition Internationally. 13
Besides hard and soft law aimed primarily at climate change, the UN General Assembly 14 has adopted non-binding legal instruments that encompass all three pillars of sustainable development (economic, social and environmental) and make a connection between labour (as part of the social pillar) and the environment. Besides earlier Declarations in the form of the Johannesburg Declaration on Sustainable Development (2003) 15 and The Future We Want Declaration (2012), 16 the main legal instrument in this regard is the UN 2030 Agenda for Sustainable Development (2015). 17 At its heart are the 17 Sustainable Development Goals (SDGs), which are an urgent call for action for all countries. Notably, they confirm the need to tackle economic, social and environmental problems in a coherent and integrated matter. To that end, several SDGs make or imply a connection between employment and the environment, such as SDG 4 (education and lifelong learning) and SDG 8 (decent work and sustainable economic growth). 18
The ILO
As for the ILO, the range of legal instruments is limited to soft law. Throughout its history, the ILO has promoted social justice in all major economic transitions, 19 with soft law documents highlighting and elaborating the imperative of a just transition 20 and the creation of decent work and quality jobs. Mention can be made of the Resolution and Conclusions concerning sustainable development, decent work and green jobs (2013), 21 the Recommendation on Employment and Decent Work for Peace and Resilience (2017) 22 and the Centenary Declaration for the Future of Work (2019). 23 Arguably the most influential piece of soft law in the area of just transition, however, comes in the form of the Guidelines for a just transition towards environmentally sustainable economies and societies for all (2015), 24 providing a framework and a practical tool for defining a just transition. They were formally endorsed by the International Labour Conference (ILC), the ILO's highest decision-making body, 25 on 25 June 2023 in the Resolution and Conclusions concerning a just transition towards environmentally sustainable economies and societies for all. 26 Besides endorsing the Guidelines, the Resolution and Conclusions provide a reinvigorated framework for a just transition. Furthermore, the Guidelines are used as a starting point of reference in the aforementioned Silesia Declaration, the 2021 Just Transition Declaration, the European Parliament Resolution and the Council Recommendation.
The EU
Both labour and the environment separately occupy a prominent place in the EU legal acquis. As for primary EU law, the Treaty on the Functioning of the European Union (TFEU) stresses the need to integrate both environmental and social protection into all policies and activities of the EU. Article 11 TFEU states that ‘[e]nvironmental protection requirements must be integrated into the definition and implementation of the Union's policies and activities, in particular with a view to promoting sustainable development’. 27 Similarly, Article 9 TFEU stipulates that in defining its policies and activities – including those in the environmental sphere – the EU shall ‘take into account requirements linked to the promotion of a high level of employment, the guarantee of adequate social protection, the fight against social exclusion, and a high level of education, training and protection of human health’. 28 Articles 8 and 10 TFEU contain similar provisions on the equal treatment of men and women and the prohibition of discrimination based on sex, racial or ethnic origin, religion or belief, disability, age or sexual orientation. 29
Building on the ‘constitutionalisation’ 30 of the social and environmental pillars in primary EU law, a link between labour and the environment is also made in the European Green Deal (2019), a set of policy initiatives of the European Commission with the overarching aim of meeting the Paris Agreement's target of climate neutrality in 2050. 31 Like the Paris Agreement, the European Green Deal recognises the need for a socially just transition. 32 This is followed by the European Parliament and the Council adopting the European Climate Law, which legislates that CO2 emissions should be 55% lower in 2030 compared to 1990. 33 Like the European Green Deal, the European Climate Law recognises that reaching climate neutrality will have implications for workers. Furthermore, it stipulates that the EU institutions and EU Member States shall, where appropriate, take into account socioeconomic policies and actions and shall focus on the most vulnerable and impacted populations and sectors. 34 Similarly, in 2021 the Just Transition Fund was established, providing funding to EU Member States to address, inter alia, the social and employment impacts of meeting the goals of the Paris Agreement, especially for those territories that are the most affected by the climate transition process. 35 Finally, the notion of just transition is expanded on in the European Parliament Resolution on a strong social Europe for Just Transitions (2020) 36 and the Council Recommendation on ensuring a fair transition towards climate neutrality (2022). 37
Finally, two EU legislative developments should be mentioned: the Corporate Sustainability Reporting Directive (CSRD) 38 and the Corporate Sustainability Due Diligence Directive (CSDDD), the latter of which was formally approved by the Council of the European Union on 24 May 2024 following the final approval by the European Parliament on 24 April 2024. 39 Both Directives impose obligations on certain companies in the areas of the environment and employment and make several connections between the two topics.
The principle of ‘just transition’
The supranational legal framework discussed in section 2 demonstrates various principles that should be taken into account when integrating the environment into the employment relationship. Several established principles of (labour) law are mentioned, including social justice, decent work, distributive justice, procedural justice, non-discrimination and solidarity. Unlike national labour law systems, it is clear that in the supranational framework one particular principle stands out, in which all other principles arguably come together and through which they are given a specific, environmental interpretation: the principle of ‘just transition’. Although this principle can, in general, be interpreted in different ways, 40 it is possible to distinguish its core meaning at the supranational level. First and foremost, it concerns a just transition of the workforce. 41 The principle of just transition puts the social pillar of sustainable development first, in the sense that it centralises the position of workers (in a broader social context: human beings) within the movement towards an environmentally sustainable economy. The notion of ‘just’ transition should therefore be separated from the more neutral notion of the ‘green’ transition (the transition to an environmentally sustainable economy). 42 By extension, and even though the need for a coherent policy framework is stressed throughout the supranational framework, 43 just transition is not necessarily about integrating the social, environmental and economic pillars of sustainable development. Instead, it is more of a principle through which the social pillar is concretised and, more importantly, through which that pillar is balanced against the environmental and economic pillars and the associated model of ‘green growth’. 44
It follows from the foregoing that just transition primarily follows a protective or compensatory logic, in the sense that workers are predominantly seen as a group that should be protected against, or at least be compensated for, the negative effects of climate change and the green transition (‘victims’). In contrast, they are less, as has been argued elsewhere, 45 viewed as a group that is to be utilised to realise said transition (‘actors’). The employment relationship is linked to the environment and the green transition to the extent to which the latter two produce negative externalities for workers. 46
However, the compensatory nature of just transition is not absolute. It is not necessarily irreconcilable with just transition to utilise labour law to require or enable workers to make an active contribution to the green transition. To some extent, the supranational framework recognises that just transition reflects a common global purpose that entails responsibilities for everyone, including governments, employers and workers. They are ‘agents of change’, capable of developing new ways of working that safeguard the environment for present and future generations. 47 Furthermore, the supranational framework recognises the need to provide an enabling environment for business and entrepreneurship. It does so for reasons of worker protection (such as generating decent work), 48 but also to promote the adoption of green workplace practices and to allow enterprises to pursue environmentally sustainable business models. 49 Along the same lines, it is acknowledged that the green transition will be accompanied with restructuring and adjustment in companies, 50 which will undoubtedly have negative implications for employees. These recognitions support the view that the principle of just transition does not hinder, and to some extent even supports, the utilisation and regulation of employment relationships as a means to realise the green transition.
In any case, a broader role for workers is envisaged through social dialogue and worker participation. 51 Social dialogue with worker representatives (in particular, trade unions) occupies a central position throughout the supranational framework. Like the concept of just transition, social dialogue is generally placed within the context of ensuring that workers are not left behind in the journey towards green economies. 52 However, the supranational framework equally emphasises that workers and their representatives should be involved in all stages of policymaking. The supranational framework makes clear that social dialogue and worker participation are not merely meant to protect worker interests, but also to forge social consensus over the green transition and to improve the quality of the transition policies in themselves. 53 Since social dialogue is inherently based on finding a compromise between different stakeholders, it is likely that worker representatives, when giving substance to their policymaking role, can discuss the interests of the workforce and the ways in which social partners can shape transition policies. This is especially conceivable for worker representation at company level (as opposed to sectoral or national level) in relation to the greening of workplace practices. By extension, if it is coordinated with the relevant worker representation, a contribution of the workforce is arguably not contrary to, but is instead in line with, the principle of just transition.
Finally, the emphasis in the supranational framework on worker protection does not necessarily extend to all workers. This can be derived, inter alia, from the way in which the supranational framework interprets and concretises the aforementioned principles of distributive justice and solidarity. In a labour law context, both principles are primarily concerned with the fair distribution of power and resources between employers and employees. Additionally, they are concerned with the distribution of resources between different (groups of) employees, which is best reflected in equal treatment standards. 54 Interestingly, the supranational framework clearly focuses on the latter category. In particular, the supranational framework is concerned with the ways in which the costs and benefits of the green transition should be shared between employees of different sectors and countries. The idea is that the burdens of the green transition should not be unilaterally imposed on the workers of the regions and sectors, in particular in developing countries, that are most affected by the transition, for example because they depend on fossil fuels or carbon-intensive processes. Put differently, like labour law in general, the supranational framework is primarily concerned with the protection of ‘vulnerable’ persons. 55 By extension, it can be argued that requiring workers who are less ‘vulnerable’ to contribute to the green transition (for example, through the greening of workplace practices) is a corollary of distributive justice and solidarity and is thus not contrary to, but instead contributes to, a just transition. This view is also supported by the general principle of ‘common but differentiated responsibilities’ that is enshrined, inter alia, in the UN 2030 Agenda, the Paris Agreement and the ILO Guidelines. 56
The foregoing begs the question, however, of who exactly is or should be seen as ‘vulnerable’ in a just transition context. As discussed, the supranational framework emphasises the need to protect displaced workers. By extension, it could be derived from the supranational framework that workers who are not ‘vulnerable’ to losing their jobs due to the green transition, but who are ‘vulnerable’ in a sense usually intended in labour law (for example, because they are low-paid or have little job security), could be required to contribute to the green transition and make some kind of ‘sacrifice’ to help displaced (but potentially high paid or unionised) workers. From a social justice perspective, this seems hard to argue. Put differently, the definition of just transition in the supranational framework seems (too) narrow. For example, environmental justice scholars equally define just transition in notions such as distributive justice, but they generally interpret vulnerability in a broader sense: vulnerability of any kind should not be worsened by the green transition. 57 By extension, when introducing green workplace practices the specific vulnerabilities of the worker(s) in question should always be taken into account. This requires a tailor-made approach.
Links with national labour law
Based on the findings in the previous sections, it can be concluded that, from a fundamental point of view, the supranational framework forms a basis (albeit a limited one) for integrating the environment into the employment relationship and labour law. It does so primarily with a view to protecting the worker, but also in relation to requiring the worker to contribute to the green transition. The follow-up question is what this might mean for national labour law. As has been noted elsewhere, 58 supranational principles such as sustainable development and just transition may serve various interpretive or inspirational functions for national law. By extension, there is abundant literature on just transition and its possible effects on various areas of social policy, such as health and safety at work and collective bargaining. 59 The aim of this section, however, is to scrutinise the extent to which the supranational framework itself translates the basis established in section 3 into specific labour law topics, and how this might influence national labour law. On the basis of the supranational framework, three themes with a clear relation to labour law are identified: job transition, work-related mobility of employees and remuneration.
Job transition
The first topic is that of job transition. It is common knowledge that realising the green transition will lead to substantial job losses in some sectors, like the fossil fuel sector, whilst creating job opportunities in others, such as engineering and construction (so-called ‘green jobs’). 60 In line with the predominantly compensatory logic of just transition, the supranational framework aims to protect workers by ensuring they can participate in the green economy. 61 As has been noted elsewhere, 62 the supranational framework – most notably the EU – does so by aiming to ensure the active participation of workers through job creation and training (reskilling and upskilling). The most concrete example is the Just Transition Fund. As part of the criteria for funding allocations, the Just Transition only supports activities that are directly linked to addressing the social and employment impacts of the green transition. In this regard, it specifically mentions the topics of job creation, upskilling and reskilling of the workforce and job-search assistance to jobseekers. 63
Even though it is arguably the primary feature of the supranational framework, the provisions on job creation and training do not make a direct connection with labour law. The supranational framework does not make clear if, and if so how, labour law could be adapted to enable the active participation of workers on the ‘green’ labour market. Yet, the focus on job creation and training at the supranational level may impact labour law in various ways. First, from a more abstract perspective, the supranational framework can have an influence on the ongoing development from a labour market that centralises job security (staying in the same job with the same employer) to a labour market which focuses on employment security (the possibility of finding employment and remaining employed, but not necessarily in the same job with the same employer). 64 Job creation and training are key characteristics of employment security. 65 By extension, the supranational framework could guide the interventionist spirit of the national legislator by promoting the adoption of ‘green’ reforms in the area of job creation and retraining, thereby contributing to a more employment security-oriented labour law. 66
Such green reforms can take several forms. Firstly, the training obligations of employers come to mind. In most countries, the employer has some kind of obligation to offer the employee training, for example if training is necessary for the performance of the employee's duties or if the employee is made redundant from their current job. 67 In line with the supranational framework, national legislation or jurisprudence could stretch this obligation (possibly supplemented by state funding) to enable the employee to transition to a green job within the employer's organisation. This could be relevant, for example, when employers restructure their enterprise to green their production process and create new jobs (like a construction company making the shift from constructing classic brick houses to constructing more environmentally sustainable prefabricated houses). An extended training obligation to help employees transition to green jobs fits well with the worker-protective aspect of just transition and the emphasis the supranational framework puts on reskilling and upskilling. Offering employees training to make them suitable for ‘green’ vacancies in the organisation is also in the interest of employers themselves, because the alternative course of action (dismissals) often has negative consequences for the enterprise. 68
Along the same lines, mention can be made of dismissal compensation (severance pay). In line with the shift to employment security instead of job security, dismissal compensation is not merely viewed as compensation for termination of the employment contract. Instead, in several countries dismissal compensation (also) serves a transition function: it aims to enable the employee to transition to a new job. This function implies that dismissal compensation can be used as an instrument for realising a just transition. 69 For instance, national labour law could (to my knowledge, such initiatives have not yet been taken) stipulate that the employer has to pay less dismissal compensation if the reason for the dismissal is ‘green’, for example if the dismissal is the result of a reorganisation that aims to make the company greener. This could be combined with compensation for the employee by the state or a longer period of paid education, to incentivise the employee to transition to a green job. This way, both employers and employees could be incentivised to contribute to the realisation of the green transition, thus strengthening the contention that just transition is not about protecting workers only.
Work-related mobility of employees
As discussed, the possible effects for national labour law of the emphasis on job creation and training at the supranational level are of an indirect nature: the provisions on job creation and training contained in the supranational legal framework do not introduce clear (hard or soft) obligations in the area of labour law. A more direct effect of the supranational framework is visible with regard to the topic of work-related mobility of employees. As was discussed in section 2, the Paris Agreement and the European Climate Law set out binding emission goals for their signatories. Although these instruments largely leave it up to the Member States to decide what measures are necessary to meet the goals, it is clear that mobility is one of areas in which emissions will have to decrease. 70 This is where labour law comes into play. With regard to employment relationships, the European Climate Law recognises that ensuring a gradual reduction in emissions and the transition towards climate neutrality will impact all economic actors, including workers. 71 Specifically, the measures taken by national states to implement the general emission goals will likely influence the regulation of the work-related mobility of employees by labour law.
An example of this type of influence can be found in Dutch law. To give effect to the Paris Agreement, the Dutch Secretary of State for Infrastructure and Water Management has introduced a Decree that, from 1 July 2024, will require employers with at least 100 employees to report on the work-related personal mobility (business traffic and commuting habits) of their employees. The goal is a reduction of 1 megaton of CO2 by 2030 and zero CO2 emissions from 2050. The data should provide insight into the total amount of CO2 emissions from the work-related mobility of employees, and should provide employers with an incentive to reduce these emissions. In 2026, the Dutch Ministry of Infrastructure and Water Management will evaluate the results and if employers fail to achieve sufficient CO2 reductions, a maximum CO2 emission per kilometre for each employee will be adopted with which every employer will be obliged to comply. According to the Secretary of State, employers have a major role to play in making the work-related mobility of employees more sustainable. 72
The Dutch example illustrates how international emission objectives may indirectly (i.e., through national implementation) impact the employer-employee relationship. Interestingly, a more concrete obligation to reduce emissions from the work-related mobility of employees can be seen in the CSRD. In short, the CSRD requires large companies to report on sustainability matters. In the area of employment and the environment, the CSRD requires companies to report on the impact of the green transition of the workforce (including retraining opportunities) and on the emissions of work-related travel (business travel and commuting), which are classified as Scope 3 emissions. 73 It is important to note that the CSRD not only prescribes aspects of reporting, but, to some extent, also obliges companies to have sustainability policies. 74 For example, companies must have plans to align the business model and strategy with the goal of achieving climate neutrality by 2050. 75 On the basis of this obligation, employers can argue that they feel compelled to green workplace practices, and in particular – since it is explicitly mentioned in the CSRD – to reduce the emissions from the work-related travel of their employees. 76
Unilateral amendment of employment conditions
The linkage mentioned above between emission goals and the work-related mobility of employees in the supranational framework may influence national labour law in several ways. Firstly, reference can be made to the unilateral amendment of employment conditions mentioned in section 1. Employers are already taking various measures to ‘green’ their work-related mobility policies. For example, they introduce policies on working from home or reduced working hours, which provide for different travel compensation based on the ‘greenness’ of the means of transportation, or which abolish the use of polluting company cars in exchange for greener alternatives such as public transport. 77 Depending on the national law in question, such alterations might be classed as unilateral changes of employment conditions and, therefore, be subject to certain restrictions. For example, in several countries a unilateral amendment of (important) employment conditions by the employer may constitute a dismissal which, depending on inter alia the reasons for the amendment, may be classified as unfair. 78 On the basis of the linkage between emission goals and the work-related mobility of employees in the supranational framework, it can be argued that employers have a valid argument for amending their employee mobility policies. In line with the principles set out in section 2, this is particularly the case if they have the support of worker representatives. In other words: with regard to employee mobility, the supranational framework supports the view that the environment has a place in the balancing exercise between employer and employee. Furthermore, it is submitted that its place is particularly strong if the employer can point to a specific (hard or soft) obligation, such as the one laid down in Dutch law and in the CSRD, on the basis of which employers are obliged to reduce the emissions from the work-related mobility of their employees. If the employer points to such an obligation, reducing the emissions from work-related mobility is not (only) a public interest but (also) a legitimate business interest of the employer which is likely to carry more weight in the balancing exercise. By extension, a specific obligation would improve the employer's chances of amending employment conditions successfully.
It should be noted that attempts to alter employment conditions for environment-related reasons are not limited to employers. Depending on the national law in question, employees may be able to propose changes to the terms of the employment contract (for example, to trade in a petrol car for an electric car) to which the employer may be obliged to consent, for example if it involves relatively few costs. 79 If national law provides for such a possibility, not only employers but also employees can strengthen their argument by pointing to the provisions on work-related mobility in the supranational framework. This could be relevant, for example, if employees want to work from home to avoid commuting but the employer insists they return to the office. Put differently, the supranational framework can also be put to use to address the reality that it is often the employer who has the power to decide these issues and who is more interested in economic gain and control than in the environment.
Equal treatment
Another part of labour law that may be influenced by the linkage between emission goals and the work-related mobility of employees is equal treatment. Previously, reference was made to the example of employers differentiating between the travel compensation of their employees based on the ‘greenness’ of the means of transportation. Along similar lines, some employers grant additional periods of paid annual leave to employees who go on holiday in an environmentally-friendly manner. Such differentiation might conflict with the right to equal treatment. In relation to labour law, two possible situations arise. 80
First, the green measure may constitute indirect discrimination on a protected ground, such as age or gender. For example, for employees with disabilities, green alternatives such as cycling or using public transport will often be less feasible or will not be an option at all. As a result, it is conceivable that a distinction between green and non-green travel allowances could put persons with disabilities at a disadvantage compared to those without disabilities, resulting in indirect discrimination on the ground of disability. 81 Second, even if the differentiation does not constitute discrimination on a protected ground, in several legal systems equal work in equal circumstances should be treated equally, without the need to establish a connection with a protected ground. 82 Although the strictness of the test may differ, in both scenarios the relevant question is whether the employer's pursuit of a public interest, such as the environment, constitutes a legitimate aim that can objectively justify the differentiation. On the basis of the supranational framework, it can be argued this question is to be answered in the affirmative. As with the doctrine of the unilateral amendment of employment conditions, it can be argued that the linkage between emission goals and the work-related mobility of employees in the supranational framework gives employers a valid argument – or, in the words of the Court of Justice of the EU, a ‘genuine need’ 83 – to take measures to reduce the emissions from the work-related mobility and, to realise those reductions, differentiate between their employees, especially when they have the support of the relevant worker representatives. 84 Furthermore, with regard to the Member States of the EU, it should be noted that the TFEU stipulates that environmental requirements are to be taken into account in EU social policy and vice versa, giving national courts ample room to recognise the environment as a legitimate interest when applying EU non-discrimination law. 85
With regard to differentiating between employees, reference can also be made to the principles of distributive justice and solidarity. As discussed in section 2, requiring able employees to contribute to the green transition can be seen as a corollary of these principles, which are strongly linked to equal treatment. By extension, it is arguable that granting employees who make green choices more travel compensation or periods of annual leave contributes to these principles and, therefore, to a just transition. At the same time, the supranational framework makes clear that vulnerable workers should be protected. Along these lines, it can be argued that regards should be had for employees who, for personal reasons, are unable to make green choices and, for example, travel to work by car or go on holiday by plane. At the very least, this implies that differentiation should not happen automatically and that the individual circumstances of the employee concerned should be taken into account when determining whether the differentiation is justified.
Remuneration
The third topic of labour law for which the supranational framework may be of importance is that of remuneration (wages). Remuneration has great potential as a greening measure, for example as an incentive for employees to make green choices. 86 For instance, under Belgian labour law, employers can grant employees a ‘green voucher’ (the ‘ecocheque’) with which they can purchase environmentally-friendly products or services, such as solar panels, with tax and social security contribution exemptions. 87 Collective agreements in other countries such as Canada 88 and the Netherlands 89 contain similar examples of green vouchers.
As regards the supranational legal framework, a link between the environment and remuneration was made in the Commission proposal for the CSDDD. The CSDDD provides that companies must adopt a climate transition plan. 90 As the CSRD introduces a similar obligation 91 and will be applicable to a significantly larger number of companies than the CSDDD, 92 the obligation to adopt a climate plan in the CSDDD seems largely redundant. 93 Different from the CSRD, however, the Commission proposal for the CSDDD provided that if variable remuneration was linked to the contribution of a director to the company's business strategy and long-term interests and sustainability, companies would have to take into account the fulfilment of the climate plan when setting variable remuneration. 94
Even though it is limited to the variable remuneration of directors, the Commission proposal illustrated the potential of ‘green pay’. However, due to the strong concerns of Member States regarding the provision proposed by the Commission linking the variable remuneration of directors to their contribution to the company's business strategy and long-term interest and sustainability, the proposal was deleted from the compromise text of the CSDDD of the European Council that was published on 30 November 2022, and has not returned. The argument for deletion was that the form and structure of director remuneration are matters primarily falling within the competence of the company and its relevant bodies or shareholders. National delegations rejected the idea of interfering with the different corporate governance systems within the EU, which reflect different Member States’ views about the roles of companies and their bodies in determining the remuneration of directors. 95
Although the discussion presented above is strongly linked to the specifics of director remuneration, the reticence to link remuneration to the environment in the CSDDD – and the lack of such a link in the other international and European instruments – fits in with the compensatory nature of just transition. Indeed, green pay is not about compensating workers for the negative effects of the green transition, but about incentivising workers to contribute to the realisation of that transition on a more voluntary basis. From this perspective, the failed proposal of the European Commission may be regarded as groundbreaking. Furthermore, it should be noted that utilising remuneration as a means to realise the green transition may be contrary to other ILO legislation, namely, ILO Convention No. 95 on the Protection of Wages. This Convention, which dates from 1949, stipulates that wages shall, in principle, be payable in money. In addition, employers may not limit in any manner the freedom of employees to dispose of their wages. The partial payment of wages in the form of allowances in kind is only permitted in industries or occupations in which payment in the form of such allowances is customary or desirable because of the nature of the industry or occupation concerned. It is hard to see how green remuneration in the form of a green voucher is ‘customary or desirable because of the nature of the industry or occupation concerned’. As a result, green vouchers seem to be prohibited by ILO Convention No. 95, since they are not money the employee can spend freely. 96 Put differently, the Convention seems to leave no room for a public interest such as the environment.
It can be argued that the climate debate should lead to a different conclusion. The idea that employees should have complete freedom over their wages stems from the desire to combat the phenomenon of forced shopping that occurred in the 19th century. Employees were obliged to spend part of their wages in the employer's shop to buy food or clothing, through which wages were returned to the employer and employee dependence on the employer increased. 97 Green pay has a different aim entirely. In line with the principles of the supranational framework, 98 trade unions could also play a pivotal role in ensuring the individual freedom of employees is not unduly limited, for example by laying down provisions on green pay in collective agreements and ensuring they do not endanger employees’ living wages. 99 Put differently (and as currently seems to be the case), green pay should primarily be something ‘extra’ given in addition to the regular salary. In that case, there is little reason to ban the use of remuneration as a means to contribute to the green transition. 100 However, looking at the supranational framework's general lack of focus on remuneration in combination with the primarily compensatory nature of the just transition, it seems unlikely that ILO Convention No. 95 will be amended to this end, or that the international institutions will incentivise the use of green pay in contradiction to (the text of) the Convention.
Conclusion
This contribution had explored the potential influence of international and European (hard and soft) law on the recognition of the environment as an interest of labour law. It is clear that, to some extent, the supranational legal framework brings the environment into the employment relationship. The supranational framework provides arguments to assert that the environment has a place in labour law and is a legitimate interest in the balancing exercise between employer and employee. However, when looking at the more direct impact of the supranational framework, the result can be considered disappointing. On a fundamental level, the supranational framework is primarily concerned with compensating employees for the negative effects of the green transition, and offers limited support for a broader integration of the environment into the employment relationship. On a substantive level, the supranational framework makes few connections with labour law and contains few (hard or soft) obligations for both employers and employees. Indeed, the only somewhat concrete obligation relates to the specific topic of the work-related mobility of employees and stems from an EU instrument (the CSRD) in which the interrelation between labour and the environment is not the main focus but is instead more of a side effect.
The lack of a substantive place for labour law in the supranational framework can be considered a missed opportunity. As shown in relation to work-related mobility, the presence of a specific obligation in the supranational framework may carry considerable weight when weighing employer and employee interests in national labour law. In that case, contributing to a better environment is not (only) a public interest but (also) a legitimate business interest of the employer to which more significance is attached in the balancing exercise. Put differently, the more specific international and European legislation is focused on (certain parts of) the employment relationship, the stronger the green argument of the employer or the employee will be. In this sense, the European Trade Union Confederation (ETUC) seems correct in its contention that climate policies ‘should be accompanied by concrete legislative proposals on social and labour aspects’. 101 However, to say that the international institutions should establish more links between labour law and the environment would be an oversimplification of law-making at the supranational level. At both the national and the supranational level, it is up to Member States to put flesh on the bones of the concept of ‘green’ labour law and to (re-)assess the notion of just transition as a more integrated and comprehensive concept. Nevertheless, it is submitted that the re-assessment by the Member States should not only take place at the national, but also the supranational level. Only then will labour law truly be able to contribute to a fair distribution of the costs and benefits of the green transition between different employees around the globe, and ensure that no one is left behind.
Footnotes
Declaration of conflicting interests
The author declared no potential conflicts of interest with respect to the research, authorship, and/or publication of this article.
Funding
The author received no financial support for the research, authorship, and/or publication of this article.
