No end in sight to posted workers debate

The hospitality sector is a major employer of posted workers. [snowpea&bokchoi/Flickr]

EU member states continue to clash on the reform of the posted workers directive, in a dispute that looks likely to drag on for a long time to come. EURACTIV France reports.

The divide between EU member states over posted workers is as deep as ever. The subjet was discussed by EU ministers in Brussels this morning (8 December) at the last Employment Council of the Slovak presidency.

But a stock-take of progress so far is little more than an inventory of disagreements between those that want reform, led by France, Germany and Belgium, and those committed to resisting any change, like Poland.

Europe has been trying to deal with the qustion of posted workers for several years. Governed by a law dating from 1996, the practice allows employers in one EU country to send their employees to work in another member state for a limited amount of time, while continuing to pay their social contributions in the country of origin.

But since the EU’s Eastern enlargement, the disparities between wages and social systems between the different member states have become a problem. Some employers abuse the system to get around social costs and cut the cost of labour, particularly in the construction, hospitality, road transport and agriculture sectors.

As the practice of posting workers has reached unprecedented levels, the need to address it has become increasingly urgent.

In 2000, the number of legally posted workers in France was 8,000. In 2015, it was 290,000. “The acceleration mostly came after 2010,” said one European diplomat.

France looks for EU allies in fight against low-cost workers

The French government is seeking support to tackle social dumping by revising the EU posted workers directive but its efforts are meeting with firm opposition from the UK and Eastern European countries.

While France may be the number one destination for posted workers, it is also in the top three for the number of workers it sends to other member states, along with Germany and Poland.

East-West divide

The European Commission has presented its proposal for a revision of the EU rules, but little progress has been made during negotiations so far.

Ministers have been unable to agree on fundamental questions such as measure to tackle ‘letterbox’ companies, whether or not road transport should fall within the scope of the directive or how long the maximum posting period should be.

But the debate has crystalised around the subject of pay. Countries like France and Germany have pushed for equal pay for local and posted workers. And above all, to prevent the fees related to a worker’s posting from being deducted from their salary.

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.

Deductions for transport and lodging costs can drag workers’ salaries far below the national minimum wage in the host country.

“On the subject of pay, the positions have stayed particularly polarised,” a dipliomatic source said.

In Poland, one of the most vigorous opponents of revising the directive, the question of pay is also a sensitive issue. “The idea of leveling out pay between local and posted workers […] does not take into account the fact that companies that post workers often face extra costs that local companies do not face,” a Polish diplomat told EURACTIV.

These additional costs include, for example, learning how new markets work, translating documents, lodging workers, transport, etc. “According to Polish employers, these costs can represent up to 30% of the total cost of posting workers,” the dipomat added.

Irreconcilable?

In the absence of an agreement, the negotiations have fallen behind schedule. “A few months ago, the Slovak presidency had hoped to adopt a general approach in order to be able to start the negotiations with the European Parliament, but given the differences between the member states’ positions, this progress has not been possible,” the Polish diplomat said.

Parliament bids to reconcile East and West over posted workers

The European Parliament is attempting to bridge the divide between East and West on the question of posted workers. In France, non-francophones are already excluded from some construction sites by the “Molière clause”. EURACTIV France reports.

“The Slovak presidency allowed us to get past the worst parts of the split.” said a European source.

After today’s meeting, Malta will take charge of the delicate issue when it assumes the rotating Council presidency for the first six months of 2017.

“The objective is to push the issue forward under the Maltese presidency in parallel with the Parliament, to make the processes converge,” a source told EURACTIV.

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