Posted workers and foreign companies in Danish construction Employment Relations Research Centre Posted workers and foreign companies in Danish construction Jens Arnholtz University of Copenhagen, 22. November 2016

Different groups of foreign workers Forskningscenter for Arbejdsmarkeds- og Organisationsstudier FAOS 5 August Different groups of foreign workers

Basic challenges of posting Employment Relations Research Centre Basic challenges of posting With employment contracts established in another country, adherence to Danish regulation is less obvious for both companies and workers. Temporary nature of their attachment gives less incentive to integrate into the Danish labour market. Combined with major socio-economic differences between EU member states, this non-integration can result in working condition below normal Danish standards and lead to debates about ‘social dumping’ or ‘unfair competition’.

Method – respondent drive sampling and interviews Employment Relations Research Centre Method – respondent drive sampling and interviews No register data and poor official statistics Survey with 149 Polish and 51 German posted workers in the Danish construction sector Sampling through long chained network recruitment Weighting data to avoid systematic sampling bias Estimate valid beyond the sample Additionally, interviews with 29 foreign service providers Sted og dato

Employment contracts established in another country Employment Relations Research Centre Employment contracts established in another country   Polish German Hired specifically for the posting job 53% 15% New contract in Denmark 41% 16% Which labour market are they oriented towards? 76 % compare to other posted workers in Denmark 85% compare to conditions in Germany Sted og dato

Integration into the Danish labour market Employment Relations Research Centre Integration into the Danish labour market   Polish German Company has a collective agreement 10% 58% Company does not have a collective agreement 32% 29% Don´t know if company has a collective agreement 13%   Polish German Member of a Danish trade union 6% 7% Never had contact to Danish trade union 85% 55% Don´t know what the CA minimum rate is 73% Sted og dato

Wages of Posted Polish workers Employment Relations Research Centre Wages of Posted Polish workers   Private home posting Sub-contractors posting Main contractors posting Proportion of posted workers 40 % 29 % 31 % Average wage for group 11 euro (83 Dkr) 14 euro (106 Dkr) 16 euro (119 Dkr) CA minimum rate: 15,5 Euro (116 Dkr) Danish Construction workers average wage: 23 Euro (172 Dkr) Sted og dato

Working time for posted workers Employment Relations Research Centre Working time for posted workers   Private home posting Sub- contractor s posting Main contractors posting Germans Hours per week 57 hours 55 hours 51 hours 45 hours Get overtime pay 0% 10% 31% 56 % Always works evenings while posted 53% 27% 13% 14 % Always works Saturdays while posted 66% 46% 43% 35 % Sted og dato

Payment of expenses in relation to posting Employment Relations Research Centre Payment of expenses in relation to posting Private home posting Sub- contractors posting Main contractors posting Germans Employer pays travel expense 26% 31% 52% 88 % Employer pays for transport in Denmark 48% 77% 45% 72 % Employer pays for accommodation in Denmark 32% 71% 56% 95 %

Assessment of wage FAOS 5 August Forskningscenter for Arbejdsmarkeds- og Organisationsstudier FAOS 5 August Assessment of wage

Foreign companies – where does it go wrong? Forskningscenter for Arbejdsmarkeds- og Organisationsstudier FAOS 5 August Foreign companies – where does it go wrong? Regulatory conformity Regulatory evasion 5. Demands for low prices 1. Lack of information 3. Complicated rules 2. Lack of adequate administrative capacity 4. Mistrust and cultural differences

Summing up the challenges Employment Relations Research Centre Summing up the challenges Challenge 1: Is a model based on high trade union membership and high CA coverage able to handle groups with low incentive to integrate into the labour market? Challenge 2: Many of the Polish posted workers are working for wages and conditions that are below the standards set by the collective agreement. Is a model based on voluntary adoption of collective agreements adequate for handling the regulation to these groups? Challenge 3: Especially the Polish workers’ pay a lot of expenses themselves, causing the money they can bring back home to diminish substantially. Should such issues be more strictly regulated than they are today? Sted og dato

Summing up the challenges Employment Relations Research Centre Summing up the challenges Challenge 4: Many foreign service providers do not understand the Danish model and mistrust the actors that shape it. Therefore the ally themselves with new actors (accountants, lawyers, etc.) that can bring more confusion and conflict to the field. How can this be avoided? Challenge 5: Many foreign service providers wins contracts by making tenders that do not take Danish standards of working conditions into account. This makes for a lot of conflicts, where trade union talk of social dumping while foreign companies feel like hunted gam. Can more information at an early stage change this and if so, who should provide it? Sted og dato