Proposal for a COUNCIL REGULATION (EEC) concerning the organization of a survey of labour costs in industry and the services sector
Date: 1992-03-31
Institutions: European Commission
Subjects: EU statistics, sample survey, secondary sector, tertiary sector, wage cost

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COMMISSION  OF  THE  EUROPEAN  COMVIUNITIES 

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 

(presented by  the Commission) 

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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) 

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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) 

4. 

5. 

6. 

7. 

8. 

9. 

- 2-

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. 

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. 

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), 
the  survey-
facilitating 
questionnaires  and  improving the timescale for  publication of the results. 

task  of  replying 

thereby 

the 

to 

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). 

The  planned  survey  will  furnish  detailed  statistical  data  on  employers'  expenditure  on  wages, 
salaries and  related  contributions,  as well  as on hours  worked. 

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) O J N ol  14S of 11.6.1966, p. 1. 

- 4-

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. 

The survey shall cover: 

Article 4 

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. 

-f-

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 

-i-

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. 

- 4 --

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 

-?  -

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): 
Provision of services  (studies, 
analyses, data management): 

1.22 million ecu 

-

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. 

-4$ 

-

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. 

- «-

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. 

-  iL-

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). 

-n -

—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 

-4-

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 

DOCUMENTS 

EN 

04  10 

Catalogue number: CB-CO-92-136-EN-C 

ISBN 92-77-42423-0 

Office for Official Publications of the European Communities 
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