INCOME SECURITY FOR FIXED-TERM EMPLOYEES AND SELF-EMPLOYED WORKERS DURING PERIODS OF UNEMPLOYMENT IN EUROPE 4th CONFERENCE on REGULATING FOR DECENT WORK, ILO, GENEVA 8-10 JULY 2015

« NON-STANDARD» EMPLOYMENT AND SELF-EMPLOYMENT  Labour market processes of flexibilisation: INTO EMPLOYMENT (fixed-term employment, part-time employment, zero hour work) and TOWARDS SELF- EMPLOYMENT (subcontracting and outsourcing)  In 2006 the European Commission highlighted that “the share of total employment taken up by those engaged on working arrangements differing from the standard contractual model as well as those in self-employment has increased since 2001 from over 36% in 2001 to almost 40% of the EU-25 workforce in 2005” not a marginal part of the European labour market

«NON-STANDARD» EMPLOYMENT, SELF- EMPLOYMENT AND SOCIAL SECURITY  Flexicurity principles. Part of the EU employment policies  “While most traditional social protection models, in particular social security and labour law systems, are designed to safeguard the social and employment rights of people in employment, there is a risk that with the new forms of employment which are emerging and with an increasing number of self-employed workers, new groups of workers may be faced with decreased social protection” (EUROPEAN PARLIAMENT RESOLUTION, 14 th JANUARY 2014)

RESEARCH TOPIC Legislation on unemployment benefits and statutory requirements from the point of view of fixed-term employees and self-employed workers. An overview of five EU countries

MAIN ISSUES  Involuntary TEMPORARY CONTRACTS (80% in Greece, Portugal, Spain, Cyprus in Source: EUROPEAN COMMISSION 2014)  Differences between “disguised employment” and “economically dependent” SELF-EMPLOYMENT (EUROPEAN COMMISSION 2006)  All EU Countries have unemployment benefits (only contributory level, only non-contributory level, or both levels)  Low coverage in some EU Countries for short-term unemployment (EUROPEAN COMMISSION 2015)  Lack of unemployment benefits for self-employed workers in some EU countries

INTERNATIONAL LAW- ILO Unemployment Provision Convention of 1934 (No. 44) “Employment Promotion and Protection against Unemployment Convention” of 1988 (No. 168) Unemployment Social Security (Minimum Standard) Convention No. 102 of 1952 Social Protection Floors Recommendation, 2012 (No. 202) Social Security Standards

INTERNATIONAL LAW- COUNCIL OF EUROPE EUROPEAN SOCIAL CHARTER, Article 12: Member Countries undertake “to endeavour to raise progressively the system of social security to a higher level”

INTERNATIONAL LAW- EU TFEU SECTION X:  ART. 153 (ex ART. 137 of the EC Treaty): “the Union shall support and complement the activities of the Member States” in “social security and social protection of workers” (c); the “protection of workers where their employment contract is terminated” (d); the “combating of social exclusion” (j); and “the modernisation of social protection systems without prejudice to point (c)”(k) THE COUNCIL AND THE EUROPEAN PARLIAMENT Can adopt measures to promote the cooperation between Member States Can adopt directives which establish “minimum requirements for gradual implementations” for the areas under points (a) to (i), consequently excluding points (j) and (k)

MAIN ISSUES - EU DIRECTIVES («HARD LAW»)  “Social security and social protection of workers” is the only one subject for which a unanimous vote is requested in order to adopt a Directive (Article 153 (2) (b), last paragraph)  The “financial equilibrium” of the Member States shall not be “significantly affected”.  Member States can “maintain or introduce more stringent protective measures compatible with the Treaties”, according to Article 153 (4)

OPEN METHOD OF COORDINATION AND «SOFT LAW» INSTRUMENTS  OMC  Green Paper “Modernising labour law to meet the challenges of the 21st century” of 22/11/2006 [COM (2006) 708]  European Parliament Resolution of 14th January 2014, “Social Protection for all, including self-employed workers” calls on Member States to improve social security systems where it is necessary “so that social protection provisions for self-employed workers are better adapted to the needs of those workers”.

AN OVERVIEW OF THE LEGISLATION IN FIVE EU MEMBER COUNTRIES SPECIFIC ASPECTS CONSIDERED (TOTAL AND INVOLUNTARY UNEMPLOYMENT)  objective scope  contribution period  contribution requirements  duration  quantity Assorted overview of how different welfare systems and national contexts have dealt with these two forms of work before and during the economic crisis

UNITED KINGDOM CBJSA:  Class 1 National Insurance Contributions (self-employed workers not included)  Two tax years considered  Two contribution requirements (26 weeks of contributions in one of the two previous tax years – 50 weeks of contributions or NIC for each of the two previous tax years, at least LEL)  Flat-rate  Duration: 182 days «Means-tested assistance, modest universal transfers or modest social- insurance plans» (ESPING-ANDERSEN 1990)

UNITED KINGDOM IBJSA:  Self-employed entitled  Income-based  Flat rate (amounts similar to those of CBJSA)  2012: Universal Credit  Fixed-term employees with intermittent career patterns may claim both IBJSA and CBJSA  Ex self-employed workers can only claim IBJSA  Sanctions and role of the active labour policies

ITALY NASPI (Decreto Legislativo 4 marzo 2015, n. 22, Art.2)  Objective scope: employees (self-employed not entitled)  13 weeks of contribution  Four years considered  75% of the average wage  Duration: half of the period of contribution  + ASDI (experimental measure)  The contribution period has been shortened but also the general level of the benefit has decreased DIS-COLL (Art. 15)  Objective scope: a “part” of the self-employed of the “Gestione Separata” (“collaboratori coordinati e continuativi, anche a progetto”)  Two contribution requirements  75% of the average wage  Duration: half of the period of contribution  Other self-employed workers have no right to the benefit  No assistance level for unemployment or for employees, nor for self-employed workers

FRANCE ARE  Objective scope: employees  Contribution period: 122 days or 610 hours in the last 28 months  Duration: reduced but it corresponds to the contribution period (max 730 days)  Extent: fixed part + variable part of 40,4% of the SJR  «droits rechargeables» RSA  Objective scope: all citizens in need (self-employed under certain circumstances)  Based on family income  Strong employment policies

GERMANY UNEMPLOYMENT I (SGB III)  Objective scope: employees (self-employed not entitled)  Contribution period: one year in the last two years  Duration: up to 12 months or more depending on age  Extent: 60 to 67% of the reference salary  The contribution period may be difficult to achieve for a fixed-term employee UNEMPLOYMENT II (SGB II)  Objective scope: all citizens in need (family considered as a needing community)  Flat-rate benefit (€ 399 per month + benefits for other family members), house expenses  Strong means-test and “one-euro-jobs”

SPAIN PRESTACIÓN POR DESEMPLEO  Objective scope: employees (self-employed not entitled)  Contribution period: minimum 360 days in the last 6 years  Duration: 120 to 720 days  Extent: 70 % of the reference salary (50% after 6 months)  The contribution period may be difficult to achieve for a fixed- term employee SUBSIDIO DE DESEMPLEO  Objective scope: employees  Contribution period: 6 months (3 for family responsibilities)  Duration: max 6 months  Flat-rate benefit

SPAIN PRESTACIÓN POR CESE DE ACTIVIDAD (Ley 32/2010, de 5 de agosto)  Objective scope: self-employed of the RETA and RETM  RETA: very wide scope  Contribution period: minimum one year  Duration: low and depending on contribution (for example, 2 months for 1 year of contribution)  No assistance level for self-employed workers: only ex- employees are entitled to RAI and Plan Prepara  Voluntary scheme

CONCLUSIONS - CONTRIBUTORY LEVEL IN THE COUNTRIES WE HAVE ANALYSED For fixed-term employees the main issue is the achievement of the contribution requirements: some Countries have shortened the contribution period but also the duration/quantity of the benefit For self-employed workers the main issue is the existence of a contributory level and whether it is compulsory or voluntary

CONCLUSIONS - ASSISTANCE LEVEL IN THE COUNTRIES WE HAVE ANALYSED  When fixed-term employees do not reach contribution requirements, in some Countries they can claim income-based assistance benefits, to which also ex self-employed are entitled  In these Countries (UK, Germany) assistance means-tested unemployment benefit is the unemployment benefit for these forms of work  In this cases the challenge moves to the degree of conditionality and to the quality of the vocational training and jobs offered by Public Employment Services

CONCLUSIONS  Both contributory and non-contributory level should be implemented (ILO, EU)  The contributory level can present problems for what concerns these forms of work, while assistance income-based UB are not granted to all the unemployed in some countries  ILO prescribes forms of “basic income” security in case of unemployment which do not exist for all unemployed in some countries  Are the non-contributory unemployment benefits in Germany and UK forms of “minimum income” or “basic income” provisions as prescribed by ILO? (conditionality and sanctions)

Thank you