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Brussels, 23 June 2005

Questions & Answers on the European Commission's Forum on restructuring

Why is this forum taking place? What are its objectives?

The European Commission announced the establishment of a 'Restructuring forum' in its 'Restructuring and employment' communication on March 31st. The forum’s mission is to keep in regular touch with ongoing changes and to ensure that initiatives dovetail, based on work already carried out by the social partners (trade unions and employers' representatives), the consultative bodies, the European institutions and other organisations. The Forum includes representatives of the European Institutions, the Governments of the Member States, regional and local authorities and the social partners.

What concrete difference can this forum make?

The Forum will meet twice a year to tackle specific themes in restructuring. Each theme, such as innovation, structural funding or a sectoral approach, will be prepared by specific working groups, potentially including outside specialists. Designed as a platform for the exchange of ideas and discussions involving high-level public and private sector representatives, the forum will play an important role in helping the Union, businesses and workers to confront the current challenges.

How does the Commission financially support restructuring and tackle its negative effects?

The structural funds, notably the European Social Fund, finance activities supporting Member States experiencing restructuring and help tackle its negative effects. These cover people working in all industries, traditional sectors undergoing restructuring - including agriculture - and other individuals and groups threatened by unemployment due to restructuring, such as young people or women. The Member States select the projects to be funded.

What has happened to the funding proposals of the Communication?

In its March Communication, the Commission had proposed a €11bn package for the new funding period of 2007-2013. This would both intervene in crises through a new growth adjustment fund and provide contingency Structural Funds reserves to help worker adaptability and economic diversification of affected regions. In the current debate on the financial perspectives, these proposals are unlikely to gain the approval of the Council.

But the Structural Funds as a whole will focus more on policies to boost employment and strengthen economic and social cohesion in four key areas: increasing adaptability or workers and enterprises; enhancing access to employment, reinforcing social inclusion and promoting partnership for reform in the fields of employment and inclusion.

What examples show the EU preparing for, and dealing with, restructuring?

The Commission is setting up a follow-up monitoring, in partnership with the main stakeholders, of the sectors likely to experience significant changes in the short term, concentrating on analysing the development of competitiveness, environmental threats and opportunities, consequences at regional level, and measures likely to be taken at Community level to anticipate and accompany change and involving the social partners in this work. In 2005 the Commission is focusing its efforts on developments in the textile and shipbuilding sectors, as well as the car industry.

The Commission recently adopted a proposal for a new EU programme to place greater emphasis on research that is relevant to the needs of European industry (EU research — Building Knowledge Europe: The EU’s new Research Framework Programme 2007–2013). This will help it compete internationally and develop its role as a world leader in certain sectors. The Commission is also working on a reform of its policy on the control of State aid by redirecting it to areas making the greatest contributions to growth and employment.

For concrete examples of how EU Structural Funds have made a difference, please see the accompanying fact sheet.

How do you plan to ensure that the Commission coordinates its responses to restructuring?

Objectives, policies and actions need to be more joined up. This requires close coordination within the Commission, as well as regular dialogue with the European Parliament and the Council. In addition to reinforcing existing coordination systems, the Communication established an internal task force involving the Commission relevant departments in late April. It will meet every two months and where necessary. Best practices of preparing for and responding to restructuring by public employment services will also be distributed by the Commission's EURES service.

What legislation is already in place to deal with restructuring?

Several Community directives are applicable in the event of corporate restructuring. Employers contemplating collective redundancies have to notify workers' representatives and begin consultations covering ways of avoiding collective redundancies or reducing the number of workers affected. In case of a change of ownership, the transfers of undertakings Directive provides for prior consultation with, and informing of, workers' representatives before a transfer occurs, as well as transfer of employment contracts to a new company owner. The information and consultation Directive outlines the general obligations for consultation and information of worker representatives' on strategic developments, foreseeable changes in employment, and any decision with an effect on employment contracts. The European works council Directive provides for transnational information and consultation, notably on company's strategy and in the event of restructuring.

What is the role of the social partners?

The second phase of consultation of the social partners included in the Communication 'Restructuring and employment' calls on the social partners (trade unions and employers' representatives) to become more involved in the ways and means of anticipating and managing restructuring. They are the key players in terms of effective action on the restructuring front, including in the forum. The Commission invites the social partners to continue their ongoing work and to negotiate on both restructuring and European works councils, which play an important role in transnational companies.

The European social partners haven't yet given their answer. The Commission will look at the progress made between now and the 2006 Tripartite Social Summit.

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