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38Kf!i C0M(92) 125 final 
Brussels, 31 March 1992 
Proposal for a 
COUNCIL REGULATION fEEC) 
concerning the organization of a survey of labour costs 
in industry and the services sector 
pO 
(presented by the Commission) 
1 -
EXPLANATORY MEMORANDUM 
The Commission cannot carry out certain tasks assigned to it by the Treaty establishing the 
European Economic Community, in particular those set out in Articles 2, 3, 117, 188, 122 and 
123 thereof, without access to data on labour costs and employees' incomes in the Community 
providing a valid basis for comparison between countries. For this reason, a series of specific 
Community^surveys on labour costs in industry '*', wholesale and retail distribution, banking and 
insurance "' has been carried out since 1959 in pursuance of Council Regulations. These surveys 
were conducted by the Commission of the European Communities in cooperation with the 
National Statistical Institutes and the ministries of labour in the Member States. 
The comparative analysis of the level and composition of labour costs in the Member States 
requires that data be obtained on the basis of uniform survey conditions and definitions. These 
conditions are met by the Community surveys on labour costs, which to date constitute the sole 
European source of statistics on wages and salaries providing a valid basis for comparison. This is 
why the survey results published by Eurostat are valued highly by the Commission departments, 
economic and social decision-makers and researchers. 
The Commission's activities in various domains require up-to-date figures on wage and salary 
costs. Eurostat, in cooperation with the competent authorities in the Member States, has worked 
out methods of updating the main results of the surveys on labour costs. However, since 
enterprises' expenditure on wages, salaries and related employers' contributions is subject to 
substantial change, such updating can only furnish valid results in the years directly following the 
survey; thereafter, it is necessary to repeat the survey. 
(1) 
(2) Regulat 
Regulat 
Regulat 
Regulat 
Regulat 
Regulat 
Regulat 
Regulat 
Regulat 
Regulat 
Regulat 
Regulat 
Regulat 
Regulat 
Regulat 
Regulat 
Regulat 
Regulat on No. 10 (OJ No. 56, 31.8.1960, p. 1199/60) 
on No. 14 (OJ No. 55, 16.8.1961, p. 1054/61) 
on No. 28 (OJ No. 41, 28.5.1962, p. 1277/62) 
on No. 151 (OJ No. 133, 13.12.1962, p. 2841/62) 
on No. 101/66/EEC (OJ No. 134, 22.7.1966, p. 2540/66) 
on (EEC) No. 1899/68 (OJ No. L 289, 29.11.1968, p. 4) 
on (EEC) No. 2259/71 (OJ No. L 238, 23.10.1971, p. 1) 
on (EEC) No. 328/75 (OJ No. L 37, 12.2.1975, p. 1) 
on (EEC) No. 494/78 (OJ No. L 68, 10.3.1978, p. 1) 
on (EEC) No. 1596/81 (OJ No. L 159, 17.6.1981, p. 1) 
on (EEC) No. 3149/83 (OJ No. L 309, 10.11.1983, p. 2) 
on (EEC) No. 1612/88 (OJ No. L 145, 11.6.1988, p. 1) 
on (EEC) No. 2053/69 (OJ No. L 263, 21.10.1969, p. 8) 
on (EEC) No. 3192/73 (OJ No. L 326, 27.11.1973, p. 1) 
on (EEC) No. 494/78 (OJ No. L 68, 10.3.1978, p. 1) 
on (EEC) No. 1596/81 (OJ No. L 159, 17.6.1981, p. 1) 
on (EEC) No. 3149/83 (OJ No. L 309, 10.11.1983, p. 2) 
on (EEC) No. 1612/88 (OJ No. L 145, 11.6.1988, p. 1) 
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4. For this reason, Eurostat's Working Party on Wage Statistics considered at the time that labour 
cost surveys should be repeated every three years. In the course of Council discussions on the 
Regulation relating to the 1984 survey, it was decided to extend the interval between surveys from 
three to four years, so that the subsequent survey was carried out with reference to 1988. It is 
desirable to maintain this periodicity and to plan the next survey with reference to 1992. 
5. The labour cost surveys have gradually increased the range of economic activities covered. 
Initially, only industry was studied, while later surveys also covered wholesale and retail 
distribution, banking and insurance. Since the end of the 1960s, the scope of the survey has not 
changed. However, greater account needs to be taken of the growth in employment in the services 
sector. For this reason, the Working Party on Wage Statistics considers it necessary to extend the 
survey to the following sectors: hotels and restaurants, activities of travel agencies and tour 
operators, real estate, renting and services to business. This choice reflects the current priorities 
in improving services statistics. 
6. In order to lighten the burden on enterprises and on the budgets of the European Communities and 
the Member States, it is not planned to make an exhaustive survey of all enterprises, but to 
proceed on the basis of a representative sample. In addition, to facilitate the enterprises' task, the 
Working Party has agreed to cease collecting data on the basis of employee-category (manual 
worker, non-manual worker), thereby facilitating the task of replying to the survey-
questionnaires and improving the timescale for publication of the results. 
7. As with the 1972, 1975, 1978, 1981, 1984 and 1988 surveys the survey is to cover local units or 
enterprises with at least ten employees. The survey will therefore be comparable with those 
conducted in previous years, and with other Community wage and salary statistics (harmonized 
statistics on earnings). 
8. The planned survey will furnish detailed statistical data on employers' expenditure on wages, 
salaries and related contributions, as well as on hours worked. 
9. The Working Party on Wage Statistics has emphasized the need to take a decision on conducting 
this survey as soon as possible, so that the enterprises and establishments to be included in the 
sample can take appropriate measures to reply to the questionnaires from the beginning of 1992. 
10. The smooth functioning of the surveys requires the Community to contribute towards the cost of 
carrying them out and of processing the results. Because the scope of the survey has been 
extended to services sectors not covered in the past, because it is also to be conducted in the new 
German territories and because changes have had to be made to the survey management 
programmes, an increase in the Community contribution to the survey costs should be considered. 
11. To this end, the Commission submits the following draft Regulation to the Council. 
Proposal for a 
COUNCIL REGULATION (EEC) No 
Of 
concerning the organization of a survey of labour costs 
in industry and the services sector 
THE COUNCIL OF THE EUROPEAN COMMUNITIES, 
Having regard to the Treaty establishing the European Economic 
Community and in particular Article 213 thereof, 
Having regard to the Commission proposal, 
Whereas, in order to fulfil the tasks assigned to it by the Treaty, 
particularly Articles 2, 3, 117, 118, 122 and 123, the Commission must 
have information regarding labour costs and workers' incomes in the 
Member States; 
Whereas the statistical data available in the Member States do not 
permit valid comparisons, particularly because of divergences in 
national legislations, regulations and administrative practices; 
whereas surveys must therefore be conducted and processed on the basis 
of standard definitions and methods; 
Whereas the best way of ascertaining the level, breakdown and 
development of labour costs and workers' income is to carry out 
specific surveys, as was most recently done in 1989 in implementation 
of Regulation (EEC) No 1612/88(*), on the basis of accounting data for 
1988; 
Whereas, because of the major changes in the level and structure of 
expenditure by enterprises on wages and related employers* 
contributions, a new survey must be carried out based on accounting 
data for 1992 in industry, trade, banking and insurance, in order to 
update the results of the previous survey; 
(1) OJNol 14S of 11.6.1966, p. 1. 
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Whereas, because of the changes in the economic structures and the 
unemployment situation in the Member States the range of economic 
activities covered must be extended, particularly in the services 
sector; 
Whereas, because of the size of the field covered, the survey must be 
based on a sample in order to avoid placing an excessive burden on the 
enterprises and the budgets of the European Communities and the Member 
States, 
HAS ADOPTED THIS REGULATION: 
Article 1 
As part of its periodical surveys on labour costs and workers' incomes, 
the Commission shall carry out a survey on labour costs in industry and 
certain services sectors in 1993 on the basis of accounting data for 
1992. 
Article 2 
The survey shall cover enterprises or local units with at least 10 
employees carrying out the activities delimited and defined in sections 
C, D, E, F, G, H and K, divisions 65 and 66, and group 63.3 of the 
Classification of Economic Activities in the European Communities (NACE 
Rev.l), apart from the exceptions indicated in Annex I. 
The survey shall be based on a sample. 
Article 3 
Employers must supply, for the enterprises or local units in the 
sample, the information necessary for determining the labour costs on 
the basis of accounting data for 1992 under the conditions set out 
below. 
Article 4 
The survey shall cover: 
a) wage costs, including bonuses and ex gratia payments, and all 
ancillary costs including in particular contributions by employers 
to social security schemes, any supplementary voluntary schemes and 
other social expenditure, including the cost of vocational training 
and any taxes or subsidies directly relating to labour costs; 
b) the total staff employed by the enterprises or local units; 
c) working hours. 
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Article 5 
Data shall be collected by the statistical institutes of the Member 
States, which shall draw up appropriate questionnaires. The Commission 
shall determine the list of characteristics and definitions to be used 
for the surveys. It shall also, under the same conditions, stipulate 
the starting and closing dates for the survey and deadlines for 
answering the questionnaires. 
The Member States shall ensure that the parties responsible for 
supplying information provide accurate and complete answers to the 
questionnaires within the specified time limits. 
Article 6 
The statistical departments of the Member States shall process the 
replies to the questionnaires. After verification and in accordance 
with the utilization programme defined by the Commission, they shall 
transmit the results of the survey to the Commission, including the 
data declared confidential by the Member States pursuant to national 
legislation or practice concerning statistical confidentiality. 
The results shall be broken down by sector of economic activity 
according to NACE Rev.l, by region and by size category of enterprise 
or local unit. 
Article 7 
The individual data supplied in the survey may be used for statistical 
purposes only. It is forbidden to use them for any other purposes, 
particularly tax purposes, or to communicate them to third parties. 
Article 8 
This Regulation shall enter into force on the day following the date of 
its publication in the Official Journal of the European Communities. 
This Regulation shall be binding in its entirety and directly 
applicable in all Member States. 
For the Council, 
President 
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ANNEX I 
Exceptions to the field covered by the survey 
1. For all the Member States: class 65.11. 
2. For Germany: section H, divisions 50, 70 and 71 and group 63.3. 
Divisions 72, 73 and 74 will be excluded for the territory of the 
former German Democratic Republic and East Berlin. 
3. For Greece: section F, group 51.1 and class 51.57. 
4. For Ireland: section H. 
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DG-34 Eurostat 
FINANCIAL STATEMENT No 1 
SECTION 1: FINANCIAL IMPLICATIONS 
1. Title of operation 
Action relating to the sectoral statistical programmes connected 
with the provisions of the Single European Act. 
Organization of a survey of labour costs in industry and services 
in 1992. 
2. Budget headings involved 
- Financial prospects - 4. other policies 
- Sub-section B-5. Consumers, internal market, industry and 
innovation 
Chapter B5-60. Statistical information policy connected with 
the completion of the internal market and in support of 
Community policies 
- Line B5-6000. Operating appropriations 
Line B8-5900. Operations support appropriations 
3. Legal basis 
Article 213 of the Treaty 
4. Description of operation 
4.1. Specific objectives of operation 
Work to standardize surveys, studies and analyses intended to 
produce a set of Community statistical information concerning: 
- social policy, 
for a total of thirty component projects of the European 
Commission's statistical programme 1989-1992, including this 
project, which involves a survey of labour costs in industry 
and services. 
4.2. Duration 
One-off operation. 
4.3. Target population 
The beneficiaries of this operation are: the Community 
institutions, the governments of the Member States, economic 
and social decision makers in the Member States, research 
institutes, universities and the media. 
Classification of expenditure or of revenue 
5.1. Non-compulsory expenditure 
5.2. DA/NDA 
5.3. Type of revenue involved: NONE 
Type of expenditure or revenue? 
6.1. 100% subsidy 
NO - The Commission's contribution only represents a fraction 
of the order of 15 to 30% of the real cost of collecting the 
data, because the Commission's statistical activity is 
devolved to a large extent; nevertheless, the expenditure is 
essential to encourage the standardization of data collection 
and compilation and their transmission to Eurostat. 
6.2. Subsidy for joint financing with other sources in the public 
and/or private sector 
YES - Public sector joint financing (budgets of the national 
statistical services). 
6.3. Interest subsidy 
NO 
6.4. Other 
NONE 
6.5. Should the operation prove an economic success, is there 
provision for all or part of the Community contribution to be 
reimbursed? 
NO 
6.6. Will the proposed operation cause any change in the level of 
revenue? 
NO 
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7. Financial impact on appropriations for operations (part B of the 
budget) 
7.1. Method of calculating total cost of operation: 
Total cost of operation in 1993: 1.31 million ecu 
of which: 
- contribution to Member States (survey, 
collection and processing): 1.22 million ecu 
- Provision of services (studies, 
analyses, data management): -
7.2. Proportion of mini-budget in total 
cost of operation: 0.09 million ecu 
7.3. Indicative schedule of commitment and 
payment appropriations 
Not applicable 
8. What anti-fraud measures are planned in the proposal for the 
operation? 
- Payments in respect of any contracts and agreements into which 
the Commission enters are only made on the basis of the 
results obtained. 
- The statistical information is considered an objective means 
of evaluating Community action programmes and thus contributes 
to consolidating the mechanism for fraud prevention. 
SECTION 2: ADMINISTRATIVE EXPENDITURE (part A of the budget) 
1. Will the proposed operation involve an increase in the number of 
Commission staff? If so, how many? 
No 
2. Indicate the amount of staff and administrative expenditure 
involved in the proposed operation. Explain the method of 
calculation. 
Unit of the DG taking part in the work: (as per establishment plan 
of 01.01.91): Unit E2 - Living and working conditions. Staff: 11 as 
of 01.01.1991, of which 2 on the "Survey of Labour Costs" project. 
0.5% of total DG 34 staff (389 as of 01.01.1991) are engaged on the 
"Survey of Labour Costs" project. 
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SECTION 3: ELEMENTS OF COST EFFECTIVENESS ANALYSIS 
1. Objectives and coherence with financial programming 
1.1. Specific objective(s) of proposed operation: 
- Statistics in the context of social policy: 
Earnings, employment, vocational training and syntheses of 
social statistics. 
1.2. Is the operation incorporated in the financial programming of 
the DG for the years concerned? 
YES - Note 476 of 8 February 1991 - DG 34 
1.3. To which broader objective defined in the DG's financial 
programming does the objective of the proposed operation 
correspond? 
Objective No 1 
2. Grounds for the operation 
2.1. Reasons for choosing this operation rather than an alternative 
which would achieve the same objectives. 
This operation achieves four results: 
- It provides the Institutions with the quantitative elements 
on the basis of which any action programme pursuant to 
Article 3 (2) of the Financial Regulation can be drawn up, 
monitored and evaluated: "it therefore contributes to more 
effective and pertinent use of the Community budget". 
- It provides the national administrations with comparable 
statistics on all of the Member States, allowing them to 
evaluate and monitor the development of Community policy 
programmes. 
- It provides political, economic and social decision makers 
in the Community with figures on which to base and evaluate 
their decisions in their respective fields of activity: it 
is therefore an essential part of the European information 
market. 
- It provides the scientific community with the information 
necessary to improve the analysis and understanding of 
economic and social life in the Community. 
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a) cost: 
The bulk of the financing for this operation comes from 
the Member States (section 1, paragraph 6.1.), which 
have a well-established structure for collecting and 
compiling data. If the Commission had to finance this 
programme entirely, the cost would be extremely high 
and the product would certainly be less reliable. 
b) spin-off effect: 
- The results of the operation contribute to improving 
the statistical information used in work related to 
social policy, economic cohesion and convergence in the 
internal market. 
The collection of statistical information is based on a 
highly devolved structure, within which the national 
systems are responsible at the level of each Member 
State. The Community statistical programme becomes an 
integral part of the national statistical programmes 
and thus contributes to creating a European statistical 
area. 
c) multiplier effect 
- Multiplier effect in tne direction of a European 
statistical area and therefore towards greater 
integration of the national statistical systems at 
Community level. 
3. Monitoring and evaluation of the operation 
3.1. Performance indicators selected: 
Monitoring of operational objectives connected with the 
provisions of the Single European Act using the ? 
3.2. Annual progress report on programme: 
Implementation of the statistical programme is constantly 
checked against a monitoring file (TBPS) which defines the 
operational objectives and resources needed for each project 
( + 190) on the basis of the planning-execution principle. At 
the beginning of each year, Eurostat prepares a report on the 
programme's progress during the previous year. This report is 
in three parts: 
- the first summarizes the main achievements of the year in 
policy terms; 
- the second describes the objective laid down and the 
results obtained for each project; 
the third provides statistics on the use made of human, 
budgetary, computer and administrative resources during the 
previous year. 
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IMPACT ASSESSMENT FORM 
IMPACT OF THE PROPOSAL ON BUSINESSES 
with special reference to small and medium-sized 
enterprises (SMEs) 
Title of the proposal: Proposal for a Council Regulation on the 
organization of a survey of labour costs in 
industry and the services sector 
Reference No of the document: 
The proposal 
1. Taking account of the principle of subsidiarity, why is Community 
legislation necessary in this area, and what are its principal 
aims? 
The aim of the survey is to obtain comparable data on the levels 
and structures of labour costs in the Member States for the purpose 
of implementing Articles 2, 3, 117, 118, 122 and 123 of the Treaty 
establishing the European Community. 
The statistical information available in the Member States is an 
inadequate basis for valid comparisons, for reasons which include, 
in particular, the differences between their legislation and 
administrative practices. The only way to ensure the comparability 
of statistics in this domain is to carry out surveys and exploit 
the results on the basis of uniform definitions and common methods. 
The survey of labour costs is presently the only statistical source 
in the field of remuneration to provide a regular flow of 
comparable data on the detailed composition of labour costs in the 
Member States. This characteristic means that the survey is 
intensively used by the Commission's departments, both sides of 
industry and researchers as a source of statistical information. 
Impact on business 
2. Who will be affected by the proposal? 
- which sectors of business? 
The survey covers undertakings in sections C, D, E, F, G, H, K, 
divisions 65, 66 and group 63.3 of the General Industrial 
Classification of Economic Activities within the European 
Communities NACE (Rev.1). 
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—which sizes of business (what is the concentration of small and 
medium-sized firms)? 
The statistical units used for the survey are the local unit with 
10 and more employees in the industrial domain and the undertaking 
with 10 and more employees in the services domain. 
Results are to be obtained for the following size classes: 
units with 10-19 employees 
units with 20-49 employees 
units with 50-99 employees 
units with 100-199 employees 
units with 200-499 employees 
units with 500-999 employees 
units with 1000 and more employees 
The proposed survey will differ from the 1988 survey in that the 
size class of "units with 10-49 employees" used in 1988 will be 
split into two size classes containing "units with 10-19 employees" 
and "units with 20-49 employees". 
The survey will not include units with less than 10 employees. 
To reduce the burden on undertakings and NSIs, the survey will be 
carried out by sampling. The sampling plans will be established by 
the NSIs which will, in general, use different sampling fractions 
for the different size classes. 
- are there particular geographical areas of the Community where 
these businesses are found? 
What will business have to do to comply with the proposal? 
Undertakings selected as respondents will be obliged to supply the 
information required for the determination of labour costs, and 
this information must be true and complete and forwarded in time to 
meet the deadline fixed in the Regulation. 
What economic effects is the proposal likely to have? 
- on employment? No effect 
- on investment and the creation of new businesses? No effect 
- on the competitive position of busineses? No effect 
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5. Does the proposal contain measures to take account of the specific 
situation of small and medium-sized firms (reduced or different 
requirements, etc)? 
Yes. Units with less than 10 employees will be excluded from the 
field, so as to reduce the number of units from which survey data 
need to be collected. 
Consultation 
6. List the organizations which have been consulted about the proposal 
and outline their main views. 
Representatives of UNICE and the CES attended the meetings of 
Eurostat Working Group on Wages held on 27 September and 19-20 
November 1991 to prepare the survey and indicated that they were in 
favour. But the UNICE representative had doubts about the 
possibility of including units with less than 10 employees. 

ISSN 0254-1475 
COM(92) 125 final 
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