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Commissioner László Andor's speaking points on "Posting of Workers"

European Commission - MEMO/12/202   21/03/2012

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MEMO/12/202

Brussels, 21 March 2012

Commissioner László Andor's speaking points on "Posting of Workers"

Introduction:

  • Today’s package strikes the right balance between protecting workers and facilitating cross-border service provision, against a background of fair competition in Europe’s single market.

  • First, our proposal for an enforcement Directive will clarify and improve the implementation in practice of the 1996 rules on the posting of workers .

  • Second, the new “Monti II” Regulation takes existing case law fully on board and sends a clear message, confirming that the freedom to provide services does not have primacy over social rights, or the other way round.

  • This is especially relevant in the context of cross-border services provision like the posting of workers, and should alleviate uncertainties following the Viking Line and Laval European Court of Justice judgements.

Why do we need an Enforcement Directive?

  • The 1996 Directive is an important compromise between the protection of workers' rights and the freedom to provide services and remains valid.

  • It defines core working conditions like minimum rates of pay, working time and provisions on health and safety at work.

  • But findings show that these minimum conditions for posted workers are often not respected. Concretely, this can mean that posted workers simply don’t get the wages to which they are entitled. So there is a strong case to improve the protection of workers temporarily posted abroad. This is also why President Barroso made a clear commitment before the European Parliament in 2009 to take action in this area.

What evidence do we have on posted workers?

The posting of workers should be a win-win for EU labour markets and for businesses.

  • It’s hugely important for the EU economy in terms of filling skills and labour shortages, and it’s essential for several sectors, like construction, transport and agriculture. It also plays an important role for businesses that need specialised, high-skilled workers, like the IT sector.

  • Contrary to some perceptions, posted workers are not always just moving from East to West. The main departure countries for posted workers are Poland, France and Germany. And the main destination countries are Germany, France and Belgium.

  • At the same time, it’s not a mass phenomenon. There are around 1 million workers posted from one member state to another, with 25% of all posted workers in the construction sector.

  • But it can create negative effects too. We know there are incidents of social dumping – one of the most recent cases is Flamanville in France where an Irish company based in Cyprus unduly withheld up to 30% of the Polish workers' salaries.

  • Today’s proposals aim to make sure we stamp out this kind of abuse and ensure fair competition.

What are we proposing concretely?

  • The new Enforcement Directive will, in particular:

  • Define responsibilities between host and receiving companies. Clear rules can better protect workers and help reduce administrative burden for companies. It will ensure better information for workers and companies about their rights and obligations and better coordination between national authorities.

  • The enforcement Directive will, in particular, clarify EU rules to avoid "letter-box" companies using "posting" to sidestep legal obligations. It will also improve law enforcement.

  • Most abuse takes place in the construction sector. This is why the Commission is proposing to introduce a "joint and several liability" principle so that building contractors and subcontractors cannot escape their responsibilities. If exploited, posted workers have a realistic chance to enforce their rights. And for business, even on the basis of the most far-reaching system in terms of liability - which we are not proposing here - the costs are limited (€2m for EU-27).

  • The "Monti II" Regulation confirms clearly that the fundamental right or freedom to strike and economic freedoms are on an equal footing.

  • It also sets out a new alert mechanism in cross-border situations. This will help to defuse potential industrial conflicts.

Conclusion:

  • Both of these proposals – the posting of workers and the balance between social rights and economic freedoms – are closely related, affecting workers and employers in the Single Market. This is why we have addressed them together in a package.

  • But, neither proposal affects, in any way, the exercise of fundamental rights, including national legislations on the right to strike. They fully respect the specific industrial relations systems in the Member States.

  • Fair competition and the protection of social rights are the bedrock of the EU’s single market.

  • The overall aim of today’s proposals is to boost quality jobs and raise competitiveness by updating and improving the way the single market works, while safeguarding workers’ rights.

See also IP/12/267 + MEMO/12/199


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