Monti II Regulation and Enforcement Directive on Posting of Workers CBSP Committee 7 November 2012 Jorma Rusanen

The issues 1.Monti II Regulation 2.Enforcement Directive on Posting of Workers

1. Monti II Regulation The European Commission gave its proposals on Monti II Regulation and enforcement Directive on posting on 21 Mars 2012 – The two proposals were considered as a package by the Commission – A Regulation ”on the exercise of the right to take collective action within the context of the freedom of establishment and the freedom to provide services” – A Directive ”on enforcement of Directive 96/71/EC concerning the posting of workers in the framework of the provision of services” The Commission withdraw its proposal for a Regulation on 12 September 2012 What happened and why?

Monti II Regulation (2) The European trade unions said NO to the Monti II Regulation proposal because it undermined the right to strike – The overall impact of the Regulation in the proposed form was damaging for the fundamental right to take collective action The ETUC warned the Commission, that it would not be able to support Monti II if a solution were not found to key issues Till June 12 national Parliaments issued a ”yellow card” on the Commission proposal for a Regulation The European Parliament and some Governments supported the trade unions opinion => So, the Commission had to recognise that its proposal did not get the political support within the EP and Council to enable its adoption

Monti II Regulation (3) ETUC and ETUF’s were particularly concerned about the following three points in Monti II proposal: – Proportionality test – Fundamental rights do not take precedence over economic freedoms – The alert mechanism was likely to cause further obstacles to the exercise of the right to strike Legal base of the proposal – The EP’s role: only to approve or reject, no amendments

Monti II Regulation (4) What should happen next? The trade unions welcomed the Commission’s decision to withdraw its proposal for a Monti II Regulation But the withdrawal of the proposal did not solve the problems created by the European Court of Justice in the Viking and Laval judgments The ETUC threrefore continues to call on the Commission to put forward a proposal for a social protocol to be attached to the European Treaties – The protocol should clarify the relationship between fundamental social rights and economic freedoms

2. Enforcement Directive on Posting Enforcement Directive on Posting [COM(2012) 131 final] – The proposal falls short of European trade union demands for a revision of the Posting of Workers Directive – However Commissioner Andor assured that the Enforcement Directive would not exclude further action for a revision – So, the proposal is a step in the right direction to prevent abuses Content of the draft Directive – Proposal contains innovations for better control and enforcement but is weak and also too restrictive – In order to avoid ”forum shopping” the relationship with the Rome I Regulation needs to be clarified – Definition of posted worker; the criteria should be more precise – Introduction of a joint and several liability mechanism; but proposal needs strengthening  BusinessEurope’s attacks – Commission tries to restrict the national control measures – Directive: normal co-decision making process in the EU institutions => cooperation with the EP necessary

Enforcement Directive (2) Reality: extremely complex networks of subcontractors – A contractor can evade regulations and collective agreed labour standards => Joint and several liability is indispensable to protect workers from abuses ETUC, ETUF’s: – Liability must apply to any sector of liability (Commission: only construction sector) – Mandatory chain liability is indispensable (Commission: direct subcontractor situations) – No ”due diligence” loophole (Commission: a contractor that has taken due diligence check cannot be held liable)

Enforcement Directive (3) What next? The ETUC’s and ETUF’s suggestions for amendments for the European Parliament The EP Committees: EMPL and IMCO Timetable in IMCO: – Deadline for amendments 6 Nov, vote 18 Dec Timetable in EMPL: – Deadline for amendments 13 Dec, vote 21 Feb The European Parliament plenary April/May 2013

Enforcement Directive (4) The ETUC Resolution (December 2011): Firm and fair ‘rules of the game’ in the single market Trade unions’ demand for a Social Progress Clause is more relevant than ever Posting: finding the right response to the challenges caused by the ECJ cases – The social objectives of the PWD must be restated – The fundamental right to collective bargaining and to take collective action must be safeguarded – The PWD must only cover situations of temporary postings – The minimum character of the PWD must be restored – The different industrial relations models must be more clearly respected – Public authorities should be allowed via social clauses in the procurement contract to demand observance of locally applicable collective agreements – The very restrictive interpretation of public policy provisions must be revised (Article 3.10 PWD) – Effective monitoring and enforcement mechanisms must be put in place

Thank you for listening!