Danbury Hatters in Sweden: A U.S. Perspective on the Available Remedies and Sanctions for Employers Who Suffer Unfair Labor Practices by Labor Unions

Abstract

This article describes the remedies available to employers who suffer unfair labor practices by labor unions, and contributes to European Union (EU) discussions on how the EU should sanction labor organizations that infringe on fundamental freedoms. These EU discussions have flourished ever since the Court of Justice of the European Union decided the Laval quartet of cases which held that worker concerted activities that impacted freedom of services and establishment in the EU violated EU law. After Laval, the Swedish Labor Court imposed exemplary or punitive damages, on labor unions for violating EU law. The U.S. experience warns against the imposition of punitive damages. Punitive damages may not only be unfair for workers, but may cause unions to become too risk-averse when representing workers. Moreover, workers' concerted activities should be understood as activities commensurate with market freedoms. If such market freedoms are exercised in unfair ways, the unions should be subject to compensatory but not punitive damages.