Commission facilitates the activities of ‘merchants of labour’

László Andor, Member of the European Commission in charge of Employment, Social Affairs and Inclusion, gave a press conference following the report adopted on the same day by the EC European Globalisation Adjustment Fund (EGF). (EC Audiovisual Services 14/11/2013).

László Andor, Member of the European Commission in charge of Employment, Social Affairs and Inclusion, gave a press conference following the report adopted on the same day by the EC European Globalisation Adjustment Fund (EGF). (EC Audiovisual Services 14/11/2013).

With unemployment skyrocketing in all but few countries of the European Union, the Commission found that the timing is right to facilitate the internal mobility of labour in the Union, in a clear cut attempt to exploit the EU’s unemployed of the south and the east and squeeze the wage levels in the north and the centre towards the bottom line. This grandiose plan, the ‘posting of workers’ will be realised by facilitating the transfer of the unemployed workers of the less developed countries of the EU to emigrate to the north but continue being remunerated and protected under the much lower conditions prevailing in their country of origin.

This is not a new idea, but this time the Commission worked hard to eliminate the last remaining controls and restrictions, which have been introduced to protect the level of wages and social protection in the developed countries of the EU. The initiative has been obviously supported by the advanced countries of the north like Germany and Britain. This could explain the reason why this Commission’s initiative had a very easy approval path through the Council and the Parliament. But let’s first examine the latest statistics of the labour market.

According to Eurostat, the EU statistical service, “The number of persons employed remained stable in both the euro area (EA17) and the EU28 in the third quarter of 2013 compared with the previous quarter”. Of course this doesn’t mean that unemployment remained also stuck. However on a yearly base employment fell. “Compared with the same quarter of the previous year, employment fell by 0.8% in the euro area and by 0.3% in the EU28 in the third quarter of 2013 (after -1.1% and -0.6% respectively in the second quarter of 2013) “. It’s obvious that employment keeps falling this year in comparison to 2012. This was the case in both quarters of 2013, the second and the third.

No better life for workers

Let’s return to the newest Commission initiative which is the new terms to ‘post worker’ from one member state to another. The terms of the country of origin have been secured say for the Romanian workers sent to Germany. On top of that, the merchants of labour have now been recognised as the basic ingredient in this new setup.

According to the relevant Commission’s note published last Thursday the Posting of Workers Directive apply to the following cases: “Directive 96/71/EC covers three cross border situations:
*posting under a contract concluded between the business making the posting and the party for whom the services are intended (‘contracting/subcontracting’)
*posting to an establishment or business owned by the same business group in the territory of another Member State (‘intra-corporate transfers’)
*hiring out by a temporary employment firm or placement agency to a user business established in another Member State”.

No worries any more for the companies implicated to this ‘trade of labour’. Everything goes. Not only the host company can employ workers hired in another member state by its own affiliate there, but practically anybody can hire workers and send them to another member state. The blocked until now intervention of the ‘merchants of people’, the infamous ‘placement agencies’ are now being recognised by name as the major catalyst in those ‘transactions’.

Passing to the conditions for this trade the Commission clarified that:

“*For activities other than construction, Member States are left the choice of imposing terms and conditions of employment laid down by collective agreements or arbitration awards which have been declared universally applicable.

*Collective agreements or arbitration awards which have been declared universally applicable must be observed by all undertakings in the geographical area and in the profession or industry concerned.
*The obligation to respect the minimum rates of pay does not oblige Member States to set or introduce minimum wages if they do not exist in the Member State in question”.

In short, the country of origin merchant of people can oblige the people hired to agree to a collective agreement along the lines of work conditions in Bulgaria or Greece for Bulgarian or Greek workers being in reality employed and labouring in Germany and Britain. It’s the dream of every EU developed country employer. This arrangement covers both remuneration and work conditions. It’s like equalising labour market realities all over the EU, not towards the best protected by national legislation work conditions but supressing them towards the least protected national environments.

Magical ideology

It’s like a magical touch. A ‘little’ EU Regulation deletes permanently the work conditions prevailing in the most developed EU countries, equalising them to the least protected labour environment still existing within the EU. This is clearly a Commission’s idea to make the EU as competitive as China. As if the Eurozone doesn’t produce enough trade surpluses which support a tough common currency, the euro, which gains always new external value highs in comparison with the dollar and the other major currencies of the world.

However the economic brains of the Brussels Commission didn’t ponder the side effects of their new ‘posting of workers’ idea, on the parity of the euro with the other major currencies. If the new system works well the euro will become even more expensive, thus neutralising any real economy productivity gains.

All in all helping the advanced EU countries to cut down their labour cost doesn’t support the demand within their economies and will work as an additional drawback to their growth. Independent economic experts estimate that Germany needs an increase in labour remuneration not a decrease and the same has been recently observed also for Britain. In short this ‘posting of workers’ Directive is just a pure product of the neoliberal ideology prevailing in the Commission, with no real substance whatsoever.

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