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22 August 2008
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Social partners agree on flexicurity - but disagree on its definition 

Published: Friday 20 October 2006    | Updated: Friday 22 June 2007   

At an informal tripartite social summit in Lahti, trade unionists and business associations rallied up behind the Nordic "flexicurity" approach to get economies going. Disagreement pertains, however, as to what the f-word means.

Background:

Poul Nyrup Rasmussen, the President of the the Party of European Socialists (PES), can with some justification be labelled as the architect of flexicurity: He introduced the scheme in Denmark when he was his country's prime minister in the 1990s. The success of flexicurity in bringing Danish unemployment down and boosting the country's economy led to interest in the scheme across Europe. 

The 2006 - 2008 work programmePdf external of the European social partners, agreed on 23 March 2006,  mentions "balance between flexibility and security" as one of the issues that employers' and workers' representatives should look at. 

The Finnish Presidency decided to theme the informal tripartite social summitexternal , held on 20 October 2006 in Helsinki, "Managing change through flexicurity". The discussion touched part of the issues also at stake in the present row between social partners around the Labour law Green Paper

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Rasmussen's PES defines flexicurity as follows: 

  • A good system of unemployment benefits, coupled with strong active labour market policies, in a clear framework of rights and duties.  
  • Facilitating active job seeking by the unemployed, with the support of the Social Partners and employment services.
  • A comprehensive system of child and elderly care.
  • Public policies to ensure the reconciliation of work and family life. 
  • Access to education and lifelong training for those in-work and for those out-of-work;
  • Public policies promoting flexibility and security to encourage active ageing and eliminate age discrimination.
  • Policies which aim at facilitating mobility, to take account of the regional dimension.
  • Full involvement of the Social Partners in designing and implementing policies both at the macro and micro levels. Social Partners should reach labour agreements that cover issues such as wages and productivity, along with training, life long learning and innovation. The Lisbon goals and the achievement of a knowledge based economy should be the driving force behind such agreements.

To this must be added, obviously, the relatively low level of protection against dismissals, which has led, together with the above measures, to a high level of job-to-job mobility within the workforce. 

On behalf of UNICE President Ernest-Antoine de Seillière, Confederation of Finnish Industries (EK) President Christopher Taxell said Pdf external at the tripartite summit: "There is undoubtedly a strong link between innovation policy and the debate on flexicurity." He added: "The flexicurity approach requires comprehensive national strategies with the right mix of economic and social measures to foster job creation and help people to maximise their chances on the labour market. This means: 

  • flexible labour law with smart rules on protection against dismissals and a variety of employment contracts to answer different needs of companies and workers together with a strong commitment to fight undeclared work;
  • putting into place effective active labour market policies, which presupposes that  the necessary budgetary margins have been created to allow such an investment, and;
  • having an employment-friendly social protection system and in particular an unemployment insurance which links rights and obligations for the unemployed as opposed to giving unconditional passive income support.

ETUC, the European Trade Union Confederation, in its July 2006 paperexternal on Social Europe also enhanced the flexicurity approach: "The EU needs to learn from examples of ’best practice’ and examine whether systems such as ’flexicurity’ - whereby greater mobility between jobs is accompanied by active welfare measures - can be adapted more broadly." At the Tripartite Summit, ETUC stressed that "the European trade union movement will not accept, under any circumstances, that flexibility should take precedence over security". 

ETUC General Secretary John Monks addedexternal : "The European Union needs a flexicurity that develops potential for workers and for jobs. This presupposes policies to promote lifelong learning, and active policies on employment, social protection and support for workers during all forms of transition."

For the small- and medium-sized business organisation UEAPMEJussi Järventaus, Director for the Federation of Finnish Enterprises, calledPdf external for "a sensible approach to flexicurity, which he defined as follows: "Flexibility is crucial for SMEs and should be promoted in all of its forms. Small businesses require internal flexibility, i.e. adjustable arrangements for working hours, part-time work and overtime; external flexibility, with more relaxed rules on 'hiring and firing'; and functional flexibility, that is to say the possibility to differentiate wages for low skilled jobs. The concept of  'job security', on the other hand, should shift towards the concept of 'employment security': in a modern, service-driven economy, workers are bound to relinquish the idea of keeping the same job through their whole professional career. Labour costs should be reduced and social protection systems urgently modernised."

Anne-Sophie Parent, President of the Social Platform saidexternal : "The sight of UNICE and the Commission running away from an open debate on flexicurity is both shocking and depressing. Finding the right labour market and social security policies across Europe is crucial if we are to respond to globalisation whilst protecting the European social model. This is an issue which affects millions of citizens across Europe who are trying to come to terms with a rapidly changing world, and increased insecurities. It is exactly the kind of issue where the Commission should be trying to open up an honest and balanced debate – but now, warned off by UNICE, it has run away from its responsibilities." 

Positions:

Finnish Prime Minister Matti Vanhanen called the meeting "very constructive," adding: "After today’s meeting we have a better common understanding about what flexicurity is about. It is about new policy combinations of life-long learning; active labour market policies; contractual relations; quality of working life and social security. We also have to keep clearly in mind that the European labour market consists of both women and men, both old and young."

Commission President José Manuel Barroso said: "Workers and enterprises can both benefit from flexicurity. Rather than taking away security from workers, new forms of security need to be created. Security in a particular job can be developed into change security, building bridges between jobs and enabling people to acquire new skills so that no one gets trapped in jobs that have no future, or that no one gets trapped in permanent unemployment."

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