# EUR-Lex - 32003R1216 - EN

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# 32003R1216

**Commission Regulation (EC) No 1216/2003 of 7 July 2003 implementing Regulation (EC) No 450/2003 of the European Parliament and of the Council concerning the labour cost index (Text with EEA relevance) **

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Official Journal L 169 , 08/07/2003 P. 0037 - 0043 *

Commission Regulation (EC) No 1216/2003

of 7 July 2003

implementing Regulation (EC) No 450/2003 of the European Parliament and of the Council concerning the labour cost index

(Text with EEA relevance)

THE COMMISSION OF THE EUROPEAN COMMUNITIES,

Having regard to the Treaty establishing the European Community,

Having regard to Regulation (EC) No 450/2003 of the European Parliament and of the Council of 27 February 2003 concerning the labour cost index(1), and in particular Article 11 thereof,

Whereas:

(1) Seasonal and working-day adjustment of the labour cost index is an essential part of the compilation of the index. Adjusted series make it possible to compare results and to interpret the index in a comprehensible manner.

(2) Predetermined transmission formats minimise the problems arising from the data transmission and, together with standardised quality reports, improve the interpretation and fast usage of the labour cost index.

(3) The measures provided for in this Regulation are in accordance with the opinion of the Statistical Programme Committee.

(4) Pursuant to Article 9 of Regulation (EC) No 450/2003, certain derogations from Regulation (EC) No 450/2003 should be granted,

HAS ADOPTED THIS REGULATION:

Article 1

Transmission and adjustment procedures

1. The transmitted indices and metadata shall be sent in electronic form by the Member States to the Commission (Eurostat). Transmission shall conform to appropriate interchange standards approved by the Statistical Programme Committee. Eurostat shall make available detailed documentation in relation to approved standards and shall supply guidelines on how to implement these standards.

2. The transmitted indices and metadata shall be prepared in such a way as to allow a thorough interpretation of the results and the efficient application of the Commission's (Eurostat) seasonal adjustment procedures for the European aggregates.

The index series shall be delivered in the following forms:

(a) unadjusted;

(b) working-day adjusted;

(c) seasonally and working-day adjusted.

Article 2

Quality

1. The quality criteria referred to in Article 8(1) of Regulation (EC) No 450/2003 shall comprise the following:

(a) relevance;

(b) accuracy;

(c) timeliness and punctuality;

(d) accessibility and clarity;

(e) comparability;

(f) coherence;

(g) completeness.

The national authorities shall ensure that the results reflect the true situation regarding the economic activities with a sufficient degree of representativity.

2. The quality reports provided for by Article 8(2) of Regulation (EC) No 450/2003 shall be transmitted to the Commission by 31 August each year at the latest and shall relate to data ending in the fourth quarter of the previous calendar year. The first quality report shall be transmitted by 31 August 2004 at the latest.

3. The content of the annual quality reports for the labour cost index shall be as set out in Annex I to this Regulation.

Article 3

Transition periods

Details relating to the transition periods provided for in Article 9(1) of Regulation (EC) No 450/2003 are set out in Annex II to this Regulation.

Article 4

Feasibility studies

Details relating to the feasibility studies provided for in Article 10 of Regulation (EC) No 450/2003 are set out in Annex III to this Regulation.

Article 5

Chaining of the index

The Laspeyres chain index formula to be used for calculating the labour cost index for combinations of NACE Rev. 1 sections referred to in the Annex to Regulation (EC) No 450/2003 is set out in Annex IV to this Regulation.

Article 6

Derogations

Derogations from the provisions of Article 1(2) accepted pursuant to Article 9(2) of Regulation (EC) No 450/2003 are set out in Annex V to this Regulation.

Article 7

Entry into force

This Regulation shall enter into force on the 20th day following that of its publication in the Official Journal of the European Union.

This Regulation shall be binding in its entirety and directly applicable in all Member States.

Done at Brussels, 7 July 2003.

For the Commission

Pedro Solbes Mira

Member of the Commission

(1) OJ L 69, 13.3.2003, p. 1.

ANNEX I

The annual reports on quality for the labour cost index include the following items:

(a) evidence of relevance to user needs:

- a summary including description of the users, origin and satisfaction of users' needs, and relevance of statistics for the users;

(b) evidence of accuracy (information broken down by NACE Rev. 1 sections):

- revision history: a table showing the revisions in the published year-on-year growth rates for total labour costs using the unadjusted series, for the last 12 quarters; a summary of the reasons for the revisions,

- coverage: a table showing the percentage of the employees represented in the sample(s)/register(s) based on the number of employees according to ESA 95; if labour cost items are collected from different sources, a table broken down by labour cost items according to Article 4(2) of Regulation (EC) No 450/2003,

- frequency: a table showing the frequency of collecting/updating the different cost item information,

- estimation: a description of the methods used to estimate/model the missing information (missing groups of employees, enterprises, economic activities and cost items); an evaluation, as quantitative as possible, of the impact on the final figures of completely missing information (missing groups of employees, enterprises, economic activities and cost items),

- hours worked: a description of the methods for compiling the hours worked; or a description of the proxy measure of the hours worked and an evaluation, as quantitative as possible of the impact of the proxy measure on the final figures,

- administrative data: where administrative data are used, comments on the correspondence and differences between the administrative concepts and the theoretical statistical concepts;

(c) timeliness and punctuality:

- a table showing the delays in days in transmitting the data for the last 12 quarters covered by the report and the correspondence between planned and actual date of transmission;

(d) accessibility and clarity:

- a description of the publication media for the data and metadata in Member States;

(e) comparability:

- a description of any differences in concepts and methods in any pair of consecutive quarters from the first quarter of 1996 onwards. In addition, a description of the differences and an assessment, as quantitative as possible, of the effect of the change in the estimates. Any differences in comparability between the NACE Rev. 1 sections should also be identified;

(f) coherence:

- a graph and a table showing annual unadjusted growth rates of the total labour cost index (NACE Rev. 1 sections) and of the ESA 95 compensation of employees per hours worked (A6 breakdown) with explanations for the differences in the growth rates for the last 12 quarters;

(g) completeness:

- a progress report of the implementation of Regulation (EC) No 450/2003 together with a detailed plan and timetable for completing the implementation; a summary of the remaining deviations from EU concepts.

The first quality report due by 31 August 2004 includes also the following items for the back data:

- a description of the sources used for the back data and the methodology employed,

- a description of the correspondence between the coverage (economic activities, employees, cost items) of the back data and that of the current data,

- a description of the comparability of the back data and the current data.

ANNEX II

THE TRANSITION PERIODS RELATING TO THE IMPLEMENTATION OF THE REGULATION

>TABLE>

ANNEX III

1. The feasibility study to assess how the quarterly labour cost indices can be obtained for NACE sections L, M, N and O

The feasibility study undertaken by a Member State shall cover in particular:

The Background

The contribution each of these economic activities makes to the national economy, expressed in terms of labour costs or a suitable alternative measure.

A description of the similarities and differences in labour cost structures and development for these economic activities compared with the cost structures and development within NACE sections C to K.

The Options

An evaluation of the practices in other Member States, where the data for these NACE sections are already available.

An assessment of the different options for obtaining the labour cost indices for NACE sections L, M, N and O, which would allow data transmission for the first quarter of 2007. The following possible data sources should be taken into account:

(a) the use of existing data collections;

(b) administrative sources;

(c) statistical estimation procedures;

(d) new data collections.

For each option considered, the assessment shall include details of the technical and legal issues involved; expected start-up and running costs for the national statistical office; cost estimates for any additional burden on businesses; the expected statistical quality of the results; any risks or uncertainties; and particular advantages or disadvantages.

The Recommendation

Based on the assessment of the different options, a recommendation on the most suitable approach shall be proposed.

The Implementation

Details of the proposed implementation plan, including start date and the completion dates of specific stages of the implementation of the recommendation.

Member States undertaking feasibility studies

The following Member States shall undertake feasibility studies to assess how the quarterly labour cost indices defined in Article 4(1) of Regulation (EC) No 450/2003 can be obtained for NACE Rev. 1 sections L, M, N and O:

- Denmark

- Germany

- Greece

- Spain

- France

- Italy

- Austria

- Sweden.

2. The feasibility study to assess how the index estimating total labour costs excluding bonuses can be obtained

The feasibility study undertaken by a Member State shall cover in particular:

The Background

The contribution bonuses make to total national labour costs with a description of the characteristics of bonus payments in the national economy.

The Options

An evaluation of the practices in other Member States, where the data are already available to calculate an index of total labour costs excluding bonuses.

An assessment of the different options for obtaining the index of total labour costs excluding bonuses, which allow data transmission for the first quarter of 2007. The following possible data sources should be taken into account:

(a) the use of existing data collections;

(b) administrative sources;

(c) statistical estimation procedures;

(d) new data collections.

For each option considered, the assessment shall include details of the technical and legal issues involved; expected start-up and running costs for the national statistical office; cost estimates for any additional burden on businesses; the expected statistical quality of the results; any risks or uncertainties; and particular advantages or disadvantages.

The Recommendation

Based on the assessment of the different options, a recommendation on the most suitable approach shall be proposed.

The Implementation

Details of the proposed implementation plan, including start date and the completion dates of specific stages of the implementation of the recommendation.

Member States undertaking feasibility studies

The following Member States shall undertake feasibility studies to assess how the index estimating total labour costs excluding bonuses defined in Article 4(2) of Regulation (EC) No 450/2003 can be obtained:

- Germany

- Greece

- France

- Italy

- Austria

- Portugal

- Finland

- Sweden.

ANNEX IV

The Laspeyres chain index formula to be used for the calculation of the labour cost index (LCI) for combinations of NACE Rev. 1 sections:

1. Define:

witj= labour costs per hour worked of employees in NACE Rev. 1 section i in quarter t in year j

ωik= labour costs per hour worked of employees in NACE Rev. 1 section i in year k

hik= hours worked by employees in NACE Rev. 1 section i in year k

Wik= ωik * hik = labour costs of employees in NACE Rev. 1 section i in year k.

2. The basic Laspeyres formula to be used to calculate the LCI for quarter t in year j, with base year k is defined as:

>REFERENCE TO A GRAPHIC>

where 1 <= t <= 4.

3. The weights used to calculate the index are defined as:

>REFERENCE TO A GRAPHIC>

where Wik, i and k are defined in paragraph 1 of this Annex.

4. The annual link for year l to year l + 1, where 0 <= l < l + 1 < j is defined by:

>REFERENCE TO A GRAPHIC>

5. The Laspeyres chain index formula for quarter t in year j with reference year k = 0 and m the interval required to process and apply the necessary annual weights, where 1 <= m <= 2, is defined as:

LCItj(0) = 100. (L0,1). (L1,2) ..... (Lj-m-1,j-m ). LCItj(j-m).

6. The first reference year shall be the year 2000, when the annual labour cost index equals 100.

ANNEX V

Derogations

Denmark, Germany, France and Sweden: the index series shall be delivered only (b) working-day adjusted and (c) seasonally and working-day adjusted. The working-day and seasonal adjustment methods shall be fully documented and made available for the Commission (Eurostat).