Brussels, 20-21/03/2007
{{Introduction
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On 22 November 2006, the European Commission presented a Green Paper under the title ‘Modernising labour law to meet the challenges of the 21st century'. With this Green Paper, it wants to launch a debate in the EU on how labour law can evolve to support the Lisbon strategy's objective of achieving sustainable growth with more and better jobs. According to the Commission, the modernization of labour law constitutes a key element for the success of the adaptability of workers and enterprises. This objective needs to be pursued, says the Green Paper, in the light of the Community's objectives of full employment, labour productivity and social cohesion.
With this document, presenting the key points of its position as elaborated in the attached position, the ETUC is taking a position on the Green Paper.
{{Preliminary remark
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The Commission has started an open public consultation, via a website, and has announced a Communication, in the context of the wider topic of flexicurity that the Commission is currently developing with the Member States. The Social Partners at European level have also received an invitation to respond to the consultation.
The ETUC wants to express its strong disagreement with the consultation procedure followed by the Commission. There is no doubt that the subject of the consultation is clearly in the heart of the ‘social policy field' as mentioned in Article 138 of the European Treaty, and therefore Social Partners at European level should be consulted in a different way, and with a clearly different weight, than the wider public, to allow them to in an early stage influence the direction of the initiatives to be taken, and to allow them to express their interest to take up the issue themselves for negotiation.
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The ETUC's key views on the Green Paper
}}The ETUC welcomes the recognition of the need for increased protection of the growing proportion of workers across the EU in precarious forms of employment. The most vulnerable workers in the EU are increasingly not properly covered, in law or in practice, by labour law and social security, leading to situations of permanent insecurity and social exclusion.
This situation is not in line with one of the basic objectives of the European Union, i.e. to improve the living and working conditions of its populations, nor with the Lisbon agenda which is aiming at more and better jobs, a high road to economic growth and employment, and social inclusion, and needs to be urgently addressed.
However, the ETUC strongly disagrees with the analytical framework presented in the Green Paper. According to the Commission's analysis, the traditional model of the employment relationship is outdated, because ‘overly protected', and therefore alternative models of contractual relations would have to be developed. The Green Paper states that, in order to reduce segmentation, i.e. the gap between the ‘insiders' and the ‘outsiders', the flexibility in standard contracts must be enhanced. In addition, it states that dismissal protection must be weakened because it would reduce the dynamism of the labour market, and thereby would worsen the prospects of women, youths and older workers. In other words, the Commission sees flexibility of labour law (contractual arrangements) as the key instrument to promote adaptability of workers and enterprises.
According to the ETUC, this analysis is simplistic and one-sided, does not appropriately take into consideration the wealth of research that has been produced in the last few decades on these issues, and does not pay sufficient attention to all the necessary elements of policy that are related to the proper functioning of the labour market and the integration of the most disadvantaged groups.
For ETUC, the assumption that the indefinite employment contract is an outdated concept which would not be suitable anymore for the modern world of work is totally unacceptable . Not only is the great majority of employment relationships still based on this concept, also in recent times it has been re-affirmed by the European Social Partners that permanent contracts are the norm. And the ECJ has confirmed in various cases that the right to enjoy an indefinite contract of employment and the principle of equal treatment limit the scope of Member States to ‘flexibilize' their labour markets and labour law. ETUC therefore does not accept that there is any need for an ‘alternative contractual model'.
The ETUC is very concerned that the Green Paper is focussing almost exclusively on the personal scope of labour law, and gives very little consideration to collective labour law . For ETUC, the basic principles of labour law as it has developed in Europe over the last 200 years are still very valid. Labour law is based on the assumption of an unequal power relationship between worker and employer, and therefore provides the worker with protection either by law or collective agreement (or a combination of both). In most EU countries labour law has developed in a rich variety of forms.
Modernising labour law cannot be discussed without taking account of the overall regulatory framework in the country concerned, and without recognizing collective bargaining as an important source of labour law.
Collective bargaining should be recognized in its double role, both as an important ‘regulatory force' (to regulate contractual and employment relations as well as internal and external flexibility in a broad range of areas, from working time to agency work, from work organisation to the reconciliation of work, private and family life, etc.), as in its role to provide a democratic and participatory process for modernisation and change.
For ETUC it is unacceptable that the Green Paper sees the level of employment protection (or EPL) as the most decisive element of ‘flexibility at work'. This totally denies developments in the last decades in most work organisations, often supported by collective agreements, in the direction of various forms of internal flexibility (working time arrangements, functional flexibility, etc.)
Moreover, as research has shown, and as recognized by the OECD, there is no clear link between the level of EPL and the level of (un)employment , whereas the decrease of employment protection could affect trust, loyalty and personal investment in the employment relation on the side of the worker, as well as affect the readiness of companies to invest in skills and training of their workforce, and therefore is counter productive to the objective of increased productivity and innovation by enterprises.
Finally, ETUC does not agree with the analysis, that the job opportunities for ‘outsiders' will increase by reducing the rights and protection of insiders. In its view, there is more reason to expect that the opposite will happen. Reducing EPL/dismissal protection will increase inequality, and may transform ‘insiders' into potential ‘outsiders', while not decreasing the current number of ‘outsiders'. At the same time, it will have negative effects on economic performance in terms of consumption and labour productivity. An adequate level of job-security is necessary in the interest of the innovative capacity of the economy.
ETUC and its members are very much interested to further develop arrangements that strengthen the position of workers in situations of job-to-job transitions in the labour market. They support more emphasis on active labour market policies (ALMP) combined with adequate unemployment benefit systems, promoting reintegration. There is also good reason to call for a better adaptation of social security and pension systems to a variety of labour market transitions. Measures to promote training and life long learning and to improve the reconciliation of work, private and family life are equally important. However, ETUC does not believe that the incentives for such a transitional labour market should be sought in ‘flexibilizing' labour law .
Although the Commission is looking at the role of labour law in ‘advancing a flexicurity agenda', the ETUC does not accept the concept of flexicurity as presented in the Green Paper, in which a very limited notion of flexibility (mainly focussing on contractual flexibility) and also a very limited notion of security (enhancing employability by training and active labour market policies) is used.
ETUC wants to remind the Commission of the limited competence of the EU with regard to labour law and social security, and the need to respect the autonomy of national social partners.
Moreover, it should be stressed that real ‘modernisation' and genuine and balanced ‘flexicurity models' wherever these have come about in Europe, have always been the outcome of negotiations between social partners at various levels, and therefore cannot and should not be introduced ‘top-down' from the EU level. The Commission must clearly recognize and respect this, when trying to develop policies and strategies to steer the reform efforts of Member States.
At the same time, the Commission can and must act , in line with the Treaty, the Social Charter and the Charter of Fundamental rights, among other things to ensure fair and just working conditions to all workers on EU territory, to ensure respect for fundamental rights and combat discrimination, to prevent unfair competition at the expense of workers' health and safety, and to promote social dialogue.
For the ETUC, the following developments are challenging labour law in the 21-st century:
In many Member States, employer strategies or deliberate labour law reforms have led to a two tier labour market on which increasing amounts of workers - and often the most vulnerable groups of workers, such as women, young workers and migrants - are working under conditions of permanent precarity.
Also so called ‘standard' workers have not escaped from the increasing pressure of globalisation and have been faced with ‘flexibilisation' of working time, wages, and other contractual arrangements.
A shift in production methods, work organisation, the spreading of subcontracting and outsourcing, and the way firms are nowadays moving around and financial capital is taking over from enterprise, is creating insecurity not only for the most marginal groups of workers in the periphery but increasingly also for ‘standard' workers in core companies, who are faced with restructuring and redundancies.
In many countries, collective bargaining and the coverage of collective agreements are under pressure of erosion, adding up to the precarisation of work and workers.
The increasing cross border mobility of workers, enterprises and services in an enlarging European Union challenges the capacity of national social and industrial relations systems to safeguard fair and just living and working conditions for all workers on their territory in a context of level playing fields and fair competition.
The ETUC believes that these challenges show the need for urgent action to strengthen the capacity of labour law in all its dimensions, both at national and at EU level, to cope with the modern world of work while providing for fair and decent working conditions and labour standards to all workers on EU territory.
In the attached position ETUC is therefore stressing the need to, first of all, eliminate the gap between ‘insiders' and ‘outsiders' on the labour market by improving the protection of precarious workers, tackling their exclusion from proper labour law coverage and their precarious employment and working conditions.
The following actions are proposed:
invest in better enforcement of existing national and EU labour law, and where necessary refocus the scope of labour law , to ensure that it properly covers, both in law and in practice, all the workers in subordinate employment relationships that it is supposed to cover, as recommended by the ILO in its 2006 Recommendation on the Scope of the Employment relationship; this would include promoting transformation from ‘flexible'/ precarious jobs into regular jobs;
address real causes for segmentation , such as gender inequality and the lack of policies to support work-life balance;
extend protection to new forms of (dependent) work, by considering the development of a ‘core of rights' , which is offering all working people regardless of their employment status a set of essential rights including the right to freedom of association and collective bargaining.
Secondly, the ETUC calls for the active support from national and Community authorities for modernising and strengthening the role of collective bargaining and for strong industrial relations systems .
Thirdly, ETUC reiterates that workers' capacity to face change must be enhanced by investing in forms of protection that provide workers with security throughout their working life , such as active labour market policies combined with adequate unemployment benefit systems, social security and pension systems adapted to labour market transitions, training and life long learning opportunities for all workers including ‘non-standard' workers, and improved reconciliation of work and private and family life. Investment in strong social partnership and commitment of governments is necessary to ensure balanced packages of measures.
Fourthly, in ETUC's view, the emerging European labour market(s) can no longer be managed, with regard to the social field, by relying on national rules alone, while in the meantime internal market and competition rules are increasingly interfering with national autonomy in social policies. Therefore, ETUC is asking from the EU Institutions, together with the Social Partners at EU level, to develop an EU-wide supportive legal framework , consisting of a combination of EU ‘rules of the game' and certain EU minimum-standards. This framework must clearly also contain rules regarding respect for national social policy and industrial relations, as well as rules that ensure the right for trade unions to organise countervailing power and industrial action in transnational situations.
With regard to other areas for EU action, the ETUC sees the following priorities:
Measures to improve the possibilities for reconciliation of work, private and family life , as recommended in the ETUC position of December 2006, in response to the Commission's Consultation document on this issue.
A strong Temporary Agency Directive providing for European minimum standards with regard to agency work, to complement the Posting Directive. The ETUC insists that equal pay, with the user enterprise as reference, is an essential part of the Directive.
Clarifying the employment status of the agency worker should be incorporated in the next phases of this debate.
In addition, a European instrument regulating joint and several liability (or ‘chain-responsibility') of user enterprise and intermediary in the case of agency work and subcontracting should be proposed.
A clear body of European minimum rules safeguarding the health and safety of workers with regard to working time , setting clear standards on maximum working hours and minimum rest which guarantee a bottom in competition, providing workers all over Europe with clear and unambiguous protection without any opt-outs . The ETUC therefore does not agree with the insertion of the issue of working time in the Green Paper.
ETUC refers to all its positions about the Working Time Directive adopted since 2003, and reiterates its support for the outcomes of the first reading in the European Parliament. Therefore, the ETUC is calling on the Commission and Member States to take the EP's position into full account when working towards a compromise on the revision of the Working Time Directive.
More convergent definitions of ‘worker' to improve coherence and proper enforcement of EU Directives. However, this should primarily be promoted by the development of common criteria and guidelines with regard to the definition of worker and self employment, as recommended by the ILO in its 2006 Recommendation.
More and better enforcement of existing labour law and labour standards to combat undeclared work, and a stronger role of the EU in promoting more and better cooperation and coordination between national labour and social inspectorates, for instance by establishing some kind of European ‘Socio-Pol'.
Tackling the growing informal economy and especially the labour exploitation of (undocumented) migrant workers , focussing on instruments and mechanisms to prevent and combat exploitation of migrant workers, including the recognition and enforcement of fundamental human and labour rights of irregular migrants, instead of relying on repression and deportation.
{{Conclusion
}}The ETUC highly recommends that the Commission in its Communication later this year, following up on this Green Paper, revises its analytical framework and responds to ETUC's positions about all the above mentioned issues with a view to modernise and strengthen labour law to meet the challenges of the 21st Century.
- Press release