Stealthy legislation in Brussels

A press release from Ádám Kósa

The European Parliament’s Committee on Employment and Social Affairs showed a classic example of stealthy legislation on Monday, said Fidesz MEP Ádám Kósa. The political left, supported by international trade unions and representatives of the protectionist western Member States, have joined forces about to create legislation next year that would limit the temporary posting of not only cheaper but also more competitive workers from Eastern Europe as well as to tend to mix it with the situation of undeclared workers.

The so-called Posted Workers Directive in its present form has been in force since 1996. Since the 2004 enlargement of the European Union, the governments and companies of certain western European Member States have been watching anxiously the advance of companies of Eastern European Member States. This proposal is meant to curb this development. The Hungarian EPP delegation had submitted 25 amendments to the draft to ensure that the posting of Hungarian workers would not suffer unjustified limitations. Ádám Kósa believes that the more efficient enforcement of the current regulations must be sufficient for curtailing abuses and circumventions– in which the Hungarian government is interested and already involved (see for example the introduction of electronic cash registers). It is outrageous that the two western European rapporteurs (from the Netherlands and France) incorporated 90 percent of the Hungarian amendments to the final draft in a way that they no longer reflect the original intent. Furthermore, they didn’t even consider that other EP committees were of the same opinion as Hungary.

The total number of posted workers (from one EU Member State to another) is less than 1.2 million – according to a 2016 March study of the Brussels-based think-tank Bruegel Institute. As this figure is less than half of one percent of the entire EU job market, this group is not very significant. If we also take into consideration that less than half of these posted workers are actually from the new Member States that have joined the EU since 2004, we can only recognize such protectionism from large economies in light of the fact that the legislation is considered a top-priority for the European Commission and French President Emmanuel Macron’s political agenda. For the sake of illustrating proportions, it is important to recall that in Hungary, more than one million jobs disappeared in less competitive sectors during the regime change in the 1990s. That’s almost as much as the number of posted workers in the EU today, or the number of migrants that entered Germany in the peak year of the migration crisis.

It is interesting to note that the two biggest European economies rank among the top three countries of origin for posted workers. Estimates show that 227 thousand workers are posted from Germany every year, while an annual 144 thousand arrives from France. Even though it is true that a slightly higher number leave Poland (228 thousand people), it’s clear that the new Member States are not the main sources of posted labor. (The Hungarian figure is 58,000, nearly the same as the 56,000 from Belgium.)

“The work is not over yet, and we should keep fighting to ensure that the situation of Hungarian workers will not worsen in the future,” said Ádám Kósa.

Background: According to a study by the European Commission, posted EU workers put only a minimal burden on social care systems. Foreign EU-citizens used less than one percent of the hosting country’s social care in the following six countries: Austria, Bulgaria, Estonia, Greece, Malta and Portugal. In Germany, Finland, France, the Netherlands and Sweden this figure is between one and five percent. When it comes to health care (which concerns more the inactive population), the average figure is even smaller: only 0.2 percent (in percentage of total expenditures in all countries). Within the time frame set by the law, 11 national parliaments – including the Hungarian – submitted reasoned opinions to the Commission, emphasizing that the proposal doesn’t respect the principle of subsidiarity, thereby launching the so-called ‘yellow card’ procedure. However, upon examining the arguments the Commission eventually decided to uphold the proposal by stating that it corresponds to the principle of subsidiarity. Ádám Kósa suggests that the new legislation would regulate issues that have already been regulated, thus the present proposal could not be passed without violating these existing regulations.