Brussels threatens Member States with court in pay row

(BRUSSELS) - A pay row pitting the countries that make up the European Union against tens of thousands of its civil service staff is heading for European courts, Brussels officials warned on Wednesday.

EU nations put themselves on a legal collision course with the bloc's executive body after taking a political decision to slash in half an inflation-busting pay rise drawn up under a formula previously agreed by national leaders.

The head of the European Commission, the body that proposes and enforces EU laws, will recommend taking the case to the European Court of Justice, when its cabinet next meets on January 6, a spokesman said.

Jose Manuel Barroso's proposal "will be to launch proceedings to strike down this decision (by the 27 EU nations) in the European Court of Justice," commission spokesman Amadeu Altafaj told reporters.

His comments came after the EU nations agreed among themselves, via a written procedure, that EU civil servants should receive a pay rise of 1.85 percent, rather than the 3.7 percent proposed by the EU executive and backed by staff trade unions.

The national capitals, which pay the bills, are thus telling some 50,000 EU employees and contract staff -- at the European Commission, parliament, council and court -- that the proposed salary rise is inappropriate amid national economic belt-tightening.

Some member states have cut civil servants' salaries domestically in a bid to reduce swelling national deficits, sometimes under orders from Brussels, where the commission also acts as the bloc's budgetary watchdog.

The commission points out that its figure of 3.7 percent was calculated through a complicated, but legally-binding mechanism, averaging pay rises in Brussels and eight EU countries.

The decision of the European governments "does not comply with the commission proposal that was exclusively based on the existing legal framework," the spokesman said.

He added that there was a 1973 judgment which supported the commission's case from a similar case the previous year.

Twenty EU nations backed the decision to grant just half the proposed salary rise for the European staff. Seven others abstained but would face the same court complaint.

The case, if it is launched, will take an estimated 16 months to rumble through the European courts meaning that, for the time being at least, the 1.75 percent pay rise will apply.

The row has already led to strike action by thousands of EU bureaucrats at the European Council -- the body that unites representatives of the 27 member states -- and the court of justice in Luxembourg. More strike action has also been threatened notably at the European parliament.

Basic gross monthly salaries for EU commission staff range from 2,550 euros (3,800 dollars) for a secretary to around 17,700 euros for a department head.

The 27 commissioners themselves get even more, plus housing and other perks.

The new European Union president, Herman Van Rompuy of Belgium, is to earn more than US President Barack Obama.

The European court judges themselves may also have to declare an interest.

It remains to be seen whether the EU legal beagles can forge a deal over the Christmas break which would avoid the unedifying spectacle of the EU institutions taking the EU nations to court.