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Brussels, 3 December 1997

Commission adopts Guidelines for Member States Employment Policies for 1998

Following the conclusions of the Extraordinary European Council on Employment (Jobs Summit), which took place in Luxembourg on 20-21 November 1997, the European Commission today adopted a final proposal for Guidelines for Member States' Employment Policies for 1998. The proposal, to be adopted by the Social Affairs Council on 15 December next, effectively launches the implementation of the integrated European employment strategy agreed at the Amsterdam summit last June and enshrined in the new Treaty. Built upon the four "pillars" (employability, entrepreneurship, adaptability and equal opportunities) which form the basis of the strategy, the Guidelines set out a number of specific targets for Member States to achieve in order to increase employment levels on a lasting basis. In particular, quantified targets have been set regarding the new start to be given to young and long-term unemployed and on increased access to training for the unemployed.

Once adopted by the Council, the Guidelines (see Annex) will have to be incorporated into national employment action plans drawn up by the Member States in the form of national objectives, quantified wherever possible and adapted to the particular situation of each Member State. Member States are committed to submitting these plans in time for their examination by the Cardiff European Council scheduled for June 1998.

The implementation of the Guidelines will be regularly monitored under a common procedure for assessing results: each year from now on, the Commission will report on the implementation by the Member States of the employment Guidelines. The Commission may present updated Guidelines and - if necessary - propose Recommendations to individual Member States.

This type of approach to co-ordinating national employment policies draws directly on the experience built up in the multilateral surveillance of economic policies, a method that proved particularly successful in the case of convergence. The aim is to achieve a convergence process of Member States' employment policies and to create for employment the same resolve as that applying to economic policy, so that targets can be jointly set, verified and regularly updated.

Commenting on the Jobs Summit and the Guidelines, Employment and Social Affairs Commissioner, Padraig Flynn, said, "The Jobs Summit has been a success. The original Commission proposal was endorsed by the Summit to a very large extent. I am particularly happy that European Union targets on the new start to be given to the young, the long-term unemployed and to the unemployed generally regarding training have been accepted."

Background: from the Essen strategy to the Luxembourg process:

The European Council in Amsterdam was a watershed for employment policies in the Union. With the adoption of a new Employment Title, the Heads of State and Government agreed that employment should be considered as a matter of common concern. Building on the existing procedure launched at Essen, the new Treaty, still to be ratified, seeks to reinforce the co-ordination of national employment policies and foresees the establishment of common guidelines which can, in due course, lead to recommendations to Member States.

The Amsterdam Summit also agreed that the provisions of the new Employment title should be made effective immediately, and called an extraordinary European Council to discuss the employment situation. The Heads of State and Government gathered at the Luxembourg Jobs Summit on 20-21 November last, clearly expressed their political will to define - and adhere to - a comprehensive strategy for employment. This involves the pursuit of sound macroeconomic policies, proper functioning of the Single Market, and thorough reform of the labour market based on a number of agreed priorities as expressed in the Guidelines for Member States Employment Policies.



Tackling youth unemployment and preventing long term unemployment

In order to influence the trend in youth and long term unemployment the Member States will develop preventive and employability oriented strategies, building on the early identification of individual needs; within a period to be determined by each Member State which may not exceed five years and which may be longer in Member States with  particularly high unemployment, Member States will ensure that:

 every unemployed young person is offered a new start before reaching six months of unemployment, in the form of training, retraining, work practice, a job or other employability measure;

 unemployed adults are also offered a fresh start before reaching twelve months of unemployment by one of the aforementioned means or, more generally, by accompanying individual vocational guidance.

These preventive and employability measures should be combined with measures to promote the re employment of the long term unemployed.

Transition from passive measures to active measures

Benefit and training systems where that proves necessary must be reviewed and adapted to ensure that they actively support employability and provide real incentives for the unemployed to seek and take up work or training opportunities. Each Member State:

 will endeavour to increase significantly the number of persons benefiting from active measures to improve their employability. In order to increase the numbers of unemployed who are offered training or any similar measure, it will in particular fix a target, in the light of its starting situation, of gradually achieving the average of the three most successful Member States, and at least 20%.

Encouraging a partnership approach

The actions of the Member States alone will not suffice to achieve the desired results in promoting employability. Consequently

 the social partners are urged, at their various levels of responsibility and action, to conclude as soon as possible agreements with a view to increasing the possibilities for training, work experience, traineeships or other measures likely to promote employability;

 the Member States and the social partners will endeavour to develop possibilities for lifelong training.

Easing the transition from school to work

Employment prospects are poor for young people who leave the school system without having acquired the aptitudes required for entering the job market. Member States will therefore:

 improve the quality of their school systems in order to reduce substantially the number of young people who drop out of the school system early;

 make sure they equip young people with greater ability to adapt to technological and economic changes and with skills relevant to the labour market, where appropriate by implementing or developing apprenticeship training.


Making it easier to start up and run businesses by providing a clear, stable and predictable set of rules and by improving the conditions for the development of risk capital markets. The new facilities offered by the EIB combined with the Member States' efforts will enable new businesses to be set up more easily. The Member States should also reduce and simplify the administrative and tax burdens on small and medium-sized enterprises. To that end the Member States will:

 give particular attention to reducing significantly the overhead costs and administrative burdens for businesses, and especially small and medium-sized enterprises, in particular when hiring additional workers;

 encourage the development of self employment by examining, with the aim of reducing, any obstacles which may exist, especially those within tax and social security regimes, to moving to self employment and the setting up of small businesses, in particular by employed persons.

Exploiting the opportunities for job creation

If the European Union wants to deal successfully with the employment challenge, all possible sources of jobs and new technologies and innovations must be exploited effectively. To that end the Member States will:

 investigate measures to exploit fully the possibilities offered by job creation at local level, in the social economy and in new activities linked to needs not yet satisfied by the market, and examine, with the aim of reducing, any obstacles in the way of such measures.

Making the taxation system more employment friendly and reversing the long term trend towards higher taxes and charges on labour (which have increased from 35% in 1980 to more than 42% in 1995). Each Member State will:

 set a target, if necessary and taking account of its present level, for gradually reducing the overall tax burden and, where appropriate, a target for gradually reducing the fiscal pressure on labour and non wage labour costs, in particular on relatively unskilled and low-paid labour, without jeopardizing the recovery of public finances or the financial equilibrium of social security schemes. It will examine, if appropriate, the desirability of introducing a tax on energy or on pollutant emissions or any other tax measure;

 examine, without obligation, the advisability of reducing the rate of VAT on labour intensive services not exposed to cross-border competition.


Modernizing work organization

In order to promote the modernization of work organization and forms of work:

 the social partners are invited to negotiate, at the appropriate levels, in particular at sectoral and enterprise levels, agreements to modernize the organization of work, including flexible working arrangements, with the aim of making undertakings productive and competitive and achieving the required balance between flexibility and security. Such agreements may, for example, cover the expression of working time as an annual figure, the reduction of working hours, the reduction of overtime, the development of part time working, lifelong training and career breaks;

 for its part, each Member State will examine the possibility of incorporating in its law more adaptable types of contract, taking into account the fact that forms of employment are increasingly diverse. Those working under contracts of this kind should at the same time enjoy adequate security and higher occupational status, compatible with the needs of business.

Support adaptability in enterprises

In order to renew skill levels within enterprises Member States will:

 re-examine the obstacles, in particular tax obstacles, to investment in human resources and possibly provide for tax or other incentives for the development of in house training; they will also examine any new regulations to make sure they will contribute to reducing barriers to employment and helping the labour market adapt to structural change in the economy.


Tackling gender gaps

Member States should translate their desire to promote equality of opportunity into increased employment rates for women. They should also pay attention to the imbalance in the representation of women or men in certain economic sectors and occupations. Member States will:

 attempt to reduce the gap in unemployment rates between women and men by actively supporting the increased employment of women and will act to reverse the under representation of women in certain economic sectors and occupations and their over representation in others.

Reconciling work and family life

Policies on career breaks, parental leave and part time work are of particular importance to women and men. Implementation of the various Directives and social partner agreements in this area should be accelerated and monitored regularly. There must be an adequate provision of good quality care for children and other dependents in order to support women's and men's entry and continued participation in the labour market. The Member States will:

 strive to raise levels of access to care services where some needs are not currently met.

Facilitating reintegration into the labour market

The Member States will:

 give specific attention to women, and men, considering a return to the paid workforce after an absence and, to that end, they will examine the means of gradually eliminating the obstacles in the way of such return.

Promoting the integration of people with disabilities into working life

The Member States will:

  give special attention to the problems people with disabilities may encounter in participating in working life.

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