Brussels prepares to overrule Eastern Europe on posted workers directive

Marianne Thyssen [European Parliament]

The European Commission plans to reject 11 ‘yellow cards’ from the EU’s eastern member states on the new Posted Workers Directive. The debate has exposed a deep East-West divide. EURACTIV France reports.

Brussels does not want to give ground on the question of posted workers, despite protestations from most of the EU’s eastern states.

Marianne Thyssen, the European Commissioner for Employment, Social Affairs, Skills and Labour Mobility, responded point-by-point to the criticisms of these member states regarding her posted workers proposal at a hearing in the European Parliament on Tuesday (12 July).

“We take it for granted that the objectives of the proposed directive on posted workers will be better accomplished at a European level,” the Commissioner said. She added that the text did “not conflict with the competences of member states”.

Yellow card

11 national parliaments used their yellow cards on the proposal (Denmark, Bulgaria, Hungary, Croatia, the Czech Republic, Poland, Estonia, Romania, Lithuania, Latvia and Slovakia).

Thyssen then also deflected the criticisms of the 11 countries that had shown the proposal the ‘yellow card’, the subsidiarity control mechanism introduced under the Lisbon Treaty to allow national parliaments to protest when they think a piece of EU legislation compromises a national competence.

One complaint answered by Thyssen was that the proposal has been maed too soon and would conflict with an implementing directive on the same subject, adopted in 2014.

“According to these member states, our proposal is premature and would come into conflict with the implementing directive. But we passed the transposition deadline for this directive on 18 June,” the Commissioner said.

National parliaments invoke ‘yellow card’ in response to revised Posted Workers Directive

An attempt by the European Commission to revise the contentious Posted Workers directive is likely to fail, as the national parliaments of at least ten member states from Central and Eastern Europe are reported have used a yellow card to stop the legislation.

“We will decide in the College next week whether or not the proposal will go ahead,” said Thyssen. The College of Commissioners is due to meet next Wednesday (20 July).

Checks on subsidiarity

“This is a signal I take very seriously,” said Thyssen. The yellow card procedure initiated in May was “the first since the procedure was introduced under the Lisbon Treaty” as a check on the subsidiarity principle, the Belgian Commissioner added.

Under the proposed new directive, the tax regimes of posted workers will be aligned with those of local workers, and their missions limited to two years. But it does not propose a harmonisation of social contributions across EU countries.

Social dumping

The posting of workers, which allows a company to temporarily send its employees to work in other EU countries while continuing to pay social security contributions in the country of origin, has long been a subject of disagreement between European countries.

Due to disparities between social security contributions in different member states, the posting of workers can lead to social dumping. France, Germany and Belgium, the countries hosting the most posted workers, led calls for the revision of the current EU rules, which date from 1996.

France threatens to stop applying EU law on posted workers

The European Union should swiftly modify the regulation allowing pay differentials between
seconded and local workers or France will stop applying it, Prime Minister Manuel Valls said yesterday (3 July).

“We have also received letters telling us we are acting too late on the subject of posted workers,” the Commissioner said.

France even threatened to stop applying the current legislation if the executive failed to make the necessary changes. Jean-Christophe Cambadelis, the first secretary of the French Socialist party pitched into the debate with an editorial published in Libération on Wednesday (13 July).

“We demand an end to social dumping, without abandoning the free movement of people, and we are committed to changing the European legislation,” he wrote.

Co-signed with Belgian and Dutch socialist politicians, the text also highlighted numerous cases of “companies that use European legislation to avoid paying social contributions and decent salaries”.

Posted workers revision gets off to shaky start

In an attempt to fight social dumping and fraud, the European Commission proposed on Tuesday (8 March) a review of the contentious Posting of Workers Directive, which regulates people employed in one EU country, but sent to temporarily work in another country.

Caught between two opposing sides of the argument, the Commission will have to juggle many conflicting demands if the directive is to move forward.

“Our position is balanced, but the debate will not be simple and we have to come to a compromise on this question,” said Thyssen.

According to a 1996 EU directive, posted workers have to comply with the labour law of the host country. This measure is aimed at ensuring equal pay.

However, employers pay social contributions in the country of origin, which can create a gap in labour costs and boost benefits for companies.

France and other countries like Germany and Belgium have complained of the increasing use of posted workers, which they consider a form of social dumping.

The European Commission presented a new proposal aimed at replacing the 1996 directive and tightening the rules surrounding the use of posted workers.

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