Opinion of the Economic and Social Committee on "Freedom of movement for workers in the single market (Single Market Observatory)"
Date: 2001-03-28
Institutions: European Economic and Social Committee
Subjects: equal treatment, free movement of workers, labour law, residence permit, single market

29.5.2001

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Official Journal of the European Communities

C 155/47

Opinion of the Economic and Social Committee on ‘Freedom of movement for workers in the
single market (Single Market Observatory)’

(2001/C 155/10)

On 2 March 2000 the Economic and Social Committee decided to draw up an opinion, under Rule 23(3)
of its Rules of Procedure, on ‘Freedom of movement for workers in the single market’.

The Section for the Single Market, Production and Consumption, which was responsible for preparing
the Committee’s work on the subject, adopted its opinion on 8 December 2000. The rapporteur was
Mr Wilms.

The Committee adopted the following opinion at its 380th plenary session (meeting of 28 March 2001)
by 80 votes to 13, with 31 abstentions.

1.

The right of freedom of movement — importance
and future prospects

1.1.

Importance and acceptability of
movement

the right of

freedom of

1.1.1.
Freedom of movement for individuals is one of the
most important objectives of the Community, as enshrined in
the European Treaties. It is, in particular, a key basic right of
workers and their families. Freedom of movement was ident-
ified as one of the key elements of the single market by the
Treaty of Rome (‘The internal market shall comprise an area
without internal frontiers in which the free movement of
goods, persons, services and capital is ensured in accordance
with the provisions of this Treaty’).

1.1.2.
Freedom of movement for workers is, in the ESC’s
view, a key factor in the achievement of an ever closer Union.
It is also one of the most concrete expressions of the concept
of Union citizenship (1).

The ESC highlights the need to continue to give
1.1.3.
priority to improving employment opportunities throughout
Europe and, in particular, in disadvantaged regions. Since not
even the best common labour market policy in the EU is able
to bring about a completely level playing field as regards job
opportunities and income prospects, freedom of movement
for workers from regions still suffering disadvantages or for
workers possessing skills which are not sufficiently in demand
on their home labour markets, provides them with new
opportunities to share in the growing prosperity of the EU.
Ideally it also eases the labour market problems in the country
of origin without creating new labour market problems in the
host country at the same time.

1.1.4.
Further steps need to be taken to promote the
mobility of Union citizens. The ESC takes the view that the

(1) See appendix.

fundamental right to work, recently adopted by the European
Council, obliges Member States to pursue an active employ-
ment policy and also boosts employment opportunities by
creating the conditions required for increasing the mobility of
Union citizens. The ESC therefore welcomes measures to
promote mobility which are of a voluntary nature for Union
citizens or are designed to remove state obstacles to freedom
of movement.

1.1.5. Workers going to work temporarily in another EU
Member State take their culture, knowledge and experience
with them to their new country of residence and broaden their
horizons during their stay, to the benefit of both countries. As
a result, the workers themselves and the other people with
whom they come into contact both in their home countries
and in the host countries no longer perceive Europe as an
abstract concept but rather as something tangible. The way in
which freedom of movement is organised in practical terms
will, however, also determine whether these experiences are
seen as being positive or negative.

1.1.6.
Exploitation of the right of freedom of movement
has up to now not had a disruptive effect on the wage-
bargaining and welfare structures of
the host countries.
This contrasts with the frequent abuse of the freedom of
establishment and the freedom to provide services by individ-
uals masquerading as self-employed persons and by dishonest
posting enterprises and labour-brokers, and also with the
incidence of illegal employment. It is generally the case that
persons making use of the right of freedom of movement are
recruited on the same terms as nationals. The level of
acceptance of this form of migrant work is accordingly high.

1.1.7.
The Committee also stresses that certain reprehen-
sible acts, referred to in the opinion, which have occurred in
the Member States, possibly involving some employers, are
fringe activities carried out by a small, criminal minority; they
reflect neither the attitude nor the actions of the vast majority
of employers or their organisations. The impact of such actions
should not be over-stated and the misleading impression
should not be created that they are commonplace.

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1.2. Possible consequences of EU enlargement

1.2.1.
The high level of acceptance of freedom of movement
for workers could change as a result of EU enlargement, if this
were to result in migratory movements being concentrated on
a small number of sectors and particular Member States or if
the continued existence of major discrepancies in wage
levels (1) on both sides of the EU’s current eastern borders (the
difference can be as high as 1:11) were to result in large
numbers of cross-border commuters. In view of the demo-
graphic trends in most of the present EU Member States, it is
largely accepted that
further immigration from both the
applicant countries and non-EU countries will be required in
the coming decades in order to meet the general need for
labour within the present EU. This does not mean however
that in individual cases increased immigration could give rise
to or exacerbate specific problems in particular sectors and
regions which already have a high level of unemployment. The
anxieties felt by people in these sectors and regions should not
be dismissed and disregarded as an absurd fear of foreigners.
To do so would give further encouragement to anti-European
and xenophobic forces. Appropriate measures should rather
be taken to prevent a concentration of immigration in these
problematic regions and sectors, leading to social upheavals in
the host countries.

1.2.2.
The few studies available on this subject, such as the
recently published studies by Boeri/Brücker (2)
(drawn up
for the European Commission) and the German Economic
Research Institute (DIW) (3), nonetheless predict that the num-
bers of migrant workers entering the current territory of the
EU (several hundred thousand per year initially following
implementation of freedom of movement for workers) will be
well below the figures frequently quoted in public discussions
(in the millions in some cases).

1.2.3.
These same studies take the view that if immigration
is not controlled, it will be distributed unevenly between EU
Member States and sectors and not evenly throughout the EU
as a whole.

(1) The gross hourly wage for skilled workers in the manufacturing
industry in west Germany is approximately DM 28.50. The
corresponding rate for western Poland is DM 4.80 (six times
lower), whilst for eastern Poland it is still only DM 2.70 (eleven
times lower).

(2) Boeri, Tito and Brücker, Herbert: Study on the impact of the
eastward enlargement of the EU on income and employment in
the current EU Member States; study commissioned by the
Directorate-General for Employment and Social Affairs of the
European Commission and published on 23 May 2000; Berlin
and Milan 2000.

(3) German Economic Research Institute (DIW) Weekly Report
21/2000: Eastward enlargement of the EU: Mass immigration not
expected; Berlin 2000. The study is divided into two parts. Part 1
summarises the DIW’s findings on the expected extent of future
immigration from the CEEC. Part 2 — prepared by the Institute
for the Future of Work (IZA) — analyses the possible impact of
immigration on wages and employment.

1.2.3.1.
The Boeri/Brücker study states that 80 % of the
migrant workers from the CEEC are likely to seek work
in neighbouring states such as Denmark, Sweden, Finland,
Germany and Austria, where they will be employed above all
in the construction sector, agriculture and forestry, basic
services and catering. Whilst in some of these countries there
is already high unemployment and an ongoing decline in the
number of jobs, in the construction sector in particular, so
that an influx of additional workers could have damaging
consequences for both job-holders and job-seekers,
in the
other sectors referred to there is in some cases a lack of suitable
local workers.

1.2.4.
Social upheaval could be the result, particularly if the
use of the right of freedom of movement by new EU citizens
leads to an increase in the number of cross-border commuters.
Bearing in mind the major discrepancies in wage levels (ranging
from 1:4 to 1:11) and costs of living (1:4) on the two sides of
the EU’s current eastern borders, the introduction of full
freedom of movement without any transition may put short-
term strain on the labour markets of these border regions.
Practical experience, both past and present, e.g. in respect of
seasonal agricultural workers and workers posted for short
periods, confirms that such phenomena may occur in cases
where there are high wage differentials between workers’
countries of residence and countries of employment. In the
longer term, however, the opportunities presented to the
border regions will outweigh these effects, as wage differentials
of this kind will also provide an incentive for new investment.

1.2.5.
In the worst-case scenario, the immediate introduc-
tion — without any transitional period — of freedom of
movement for cross-border commuters could thus have the
effect of exerting downward pressure on the level of wages in
the border region of the host country and bringing relative
social hardship for workers. As a result of the squeeze on
prices, employers who were ready to maintain wages at an
adequate level would also encounter difficulties. Such a
development would not only run counter to the objectives of
the EU, as set out in Article 2 of the EC Treaty, but could also
bring about considerable social tension, particularly in border
regions, and encourage nationalist tendencies.

1.2.5.1.
The Committee welcomes the planned EU aid
measures for border regions designed to underpin structural
change in these areas through the expansion of infrastructure,
targeted training measures for workers and the promotion of
small and medium-sized enterprises. In order to counteract the
use of casual jobs as a means of ‘wage dumping’, the key
instrument is the Directive on the Posting of Workers. For this
Directive to have a practical impact, effective surveillance is
particularly important. Failing this, there will be serious risks
of substantial cuts in wages in certain regions and sectors.

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1.2.6.
Freedom of movement provides highly-skilled work-
ers from the applicant countries with the opportunity to make
better use of their skills, as there is often a lack of suitable jobs
in the applicant countries or at least a lack of jobs offering
wages commensurate with skill levels. If these workers were to
avail themselves of the freedom of movement in large numbers,
this could result
in a brain-drain, which would further
exacerbate the economic imbalance between regions; i.e. less-
developed regions would find themselves funding the training
of workers whilst highly-developed regions could, in the short-
term, benefit from these skilled workers and, as a result, might
fail to pay adequate attention to training their own new
generation of skilled workers. The only way to solve this
problem in the medium-term is for countries which have a
large demand for highly skilled workers to increase their efforts
to provide the requisite training.

1.3. The provision of information — a key issue

1.3.1. Workers who are interested in finding employment
in other Member States need to be provided with accurate,
reliable information in their own language. They need to be
protected against dishonest service-providers who peddle
worthless information or useless services for a high price or
place them in jobs where conditions are unfavourable.

1.3.1.1.
Before workers set out to find jobs in other Member
States, they need to be provided with detailed information on
the conditions applying there in order to prevent dishonest
labour-brokers, employers, emigrant-worker agencies,
land-
lords, language schools etc. from taking advantage of their
inexperience. Such information should cover, in particular: the
local employment situation, the rules on working conditions
set out in collective agreements, usual wage levels in particular
areas, the level of rents, etc. This information should be
provided by public bodies or non-profit organisations, such as
trade unions, welfare associations or chambers of trade or
industry.

The information required to enable workers to
1.3.1.2.
avail themselves of the right of freedom of movement should
be made available via the European Employment Services
(EURES) network (1). The ESC would highlight the importance
of this network and welcomes its establishment. As far back as
1997 the Report of the High Level Panel on Free Movement of
People, chaired by Mrs Simone Veil, issued on 18 March 1997

(‘Veil Report’) (2) criticised, albeit indirectly, the fact that this
network was not well-known and ineffective. Although the
situation has improved somewhat in the meantime, it is not
yet satisfactory.

1.3.1.3.
The EURES network regrettably remains unknown
to many of the workers who are specifically interested in
looking for work in other Member States, even though there
has recently been a marked increase in the number of people
accessing the website.

If the information currently provided by EURES on
1.3.1.4.
its web pages is representative of its work, it fails to provide
jobseekers with an accurate insight into the situation in a
chosen sector or at a chosen place of employment. Instead,
EURES includes, for example, comparisons of national, inter-
sectoral index-linked wage levels — which do not therefore
have very much meaning — with reference to wage levels in,
of all places, Zurich in Switzerland. The members of the ESC
are unable, in their wildest imagination, to see how workers
from EU Member States are able to derive the slightest benefit
from these comparative figures when endeavouring to make a
concrete appraisal of job offers.

1.3.1.5.
There continues to be a clear discrepancy between
the number of job vacancies in the Member States listed by
EURES and the much higher number of vacancies on the files
of the placement offices in the Member States. The ESC
welcomes the discussions recently launched by the Com-
mission with a view to ensuring that jobs listed in online
databases in the Member States are also publicised on the
EURES network. The ESC does, however, point out that the
information currently contained on the EURES web pages with
regard to job vacancies would, in many cases, not satisfy the
requirements set out in point 1.3.1.1 above. The job offers
usually do not even include details of working hours, wage
levels or the exact place of employment or whether the work
is temporary or permanent.

In the intervening period since the Veil Report was
1.3.1.6.
issued in 1997 there has regrettably only been a patchy
improvement in cooperation between EURES and the social
partners in the Member States.

The work of

1.3.1.7.
the EURES network is severely
handicapped above all by the fact that EURES has only some
220 advisers, 90 of whom are voluntary with a full-time job
elsewhere.

Trade unions, welfare bodies,

trade associations
1.3.2.
and employers’ organisations,
in particular, are therefore
continuing to provide the lion’s share of advisory services and
having to spend large amounts of their own money on this.
Even in the EUR-15 it is hardly possible to fund this work. The
addition of 12 further Member States and 12 further languages
would definitively overstretch the staffing and funding
resources of such associations, which are, in the main, financed
by members’ contributions.

(1) The European Employment Services (EURES) network seeks to
facilitate freedom of movement for workers in the 17 EEA states.
Partners in the EURES network include public employment
services, trade unions and employers’ organisations. This partner-
ship is coordinated by the European Commission.

(2) Report of the High Level Panel, chaired by Mrs Simone Veil, on
(‘Veil Report’).
Free Movement of People (18 March 1997)
Available on Internet at http://europa.eu.int/Comm/internal–
market/en/people/hlp/hlphmtl.htm, pages 25 et seq.

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1.3.3.
The — generally underfunded — trade unions and
associations in the applicant states would, without the strong
support of the EU, be in even less of a position to provide
budding migrant workers in their countries with advice or
protect them against dishonest practices. The ESC would point
out that the establishment and promotion of strong (i.e.
efficient and adequately funded) trade unions and employers’
if the
associations in the applicant states is also essential
freedoms offered by the single market are to be realised, and
that the Commission must play an active part in preparing the
ground here.

without his having to make a special application. The lack of
such a permit should also not have lead to expulsion as it is
not vital to the right of residence. This would not appear to be
an isolated case, as workers with insufficient income are
regularly expelled — particularly from Baden-Württemberg —
when they apply for income support if they failed to apply for
permanent right of residence at a time when their personal
circumstances were more favourable. Pensioners, too, run
into problems with the German authorities responsible for
foreigners if, for example, they have resided for more than two
years in their home country and then wish to return to
Germany.

2. Need for a new opinion

2.1.
This own-initiative opinion follows on from earlier
opinions issued by the Economic and Social Committee (1). It
carries forward and expands upon these earlier opinions since,
though some of the demands made by the ESC have been
implemented by the EU bodies, a number of the issues raised
in the previous opinions have yet to be resolved and not all of
the requests made by the ESC have been met.

2.2.1.3.
Even after persons have returned home from the
country where they worked, problems still often occur as a
result of differences in social security systems. Pensioners
returning to live in Portugal, for example, and therefore having
to leave the German sickness insurance scheme can no longer
be insured on a voluntary basis under the German nursing
care insurance scheme, despite the fact that this form of social
insurance is not available in Portugal, as persons can only
contribute on a voluntary basis to the nursing care insurance
scheme if they pay into a sickness insurance scheme in
Germany.

2.2.
Union citizens who have exercised their fundamental
right of freedom of movement are still being treated less
favourably in many fields than citizens of the host country.

2.2.1.
A number of examples are set out below from the
rapporteur’s home country of Germany. Similar examples
could also be provided from most other EU Member States.

2.2.1.4.
A series of tax discriminations also continue to
apply. For example, the tax allowances for children entitled to
maintenance are normally included on a worker’s wage slip in
Germany, but for workers from another Member State with
children still living in that Member State, these allowances
cannot be claimed until later. As a result, more tax is deducted
initially and can only be reimbursed at the end of the calendar
year.

2.2.1.1.
Citizens of other EU Member States have to pay
higher fines than German citizens for failing to carry their
identity cards.

Particularly in the case of persons applying for
2.2.1.2.
income support, the authorities are keen to invoke formalities
which have fallen into disuse in order to find a way to expel
them. Only recently — on 16 October 2000 — the German
press reported the case of an Italian applicant for income
support in Baden-Württemberg who was to be expelled after
living in Germany for 41 years because he had failed to apply
in good time for a permanent residence permit. This permit
should, however, have long been issued automatically to him

(1) ESC opinion on the Proposal for a Regulation (EC) of the European
Parliament and the Council amending Council Regulation (EEC)
No. 1612/68 on freedom of movement of workers within the
Community (OJ C 169, 16.6.1999, p. 24), ESC opinion on the
Communication from the Commission on an action plan for free
movement of workers (OJ C 235, 27.7.1998, p. 82) and the ESC
opinion on the Proposal for a Council Directive on the right of
third-country nationals to travel in the Community (OJ C 153,
28.5.1996, p. 38).

2.2.2.
Disabled Union citizens seeking to exercise their right
of freedom of movement also face considerable difficulties if
they are so severely disabled that they are dependent on
supplementary income support to lead a normal
life. The
authorities frequently use ‘dependence on income support’ —
irrespective of the cause of such dependence — as a general
excuse for refusing residence applications. Although the
Community has on the whole not sought
to harmonise
provisions in this difficult area of the law so far, the ESC thinks
that, at least in the case of disabled persons, dependence on
supplementary income support must no longer constitute a
legitimate reason for refusing residence applications.

in
2.2.3. When taking up public service employment
a different Member State, Union citizens continue to be
discriminated against in many cases over the recognition of
periods of comparable employment — and therefore with
regard to the income bracket in which they are placed and
promotion. In the private sector, too, previous periods of
employment and vocational training courses completed in a
workers’ country of origin are not always recognised. As a
rule, collective wage agreements make no provisions to this
effect, with the result that the granting of such recognition
frequently depends on whether or not individual agreements
are reached between employers and workers.

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2.2.4.
In the case of school children, persons undergoing
vocational training and students who move to a different
Member State before concluding their education or training, it
frequently happens that recognition is not given to periods of
education already completed and the knowledge thereby
acquired. As a result parts of their education become devalued
and the remaining period of education or training is unneces-
sarily prolonged. Existing rules governing recognition mainly
cover completed courses of education or training and to a
large extent do not take account of the problems of children
moving home with their parents.

2.2.5.
The action plan drawn up by the EU Ministers of
Education (1) pinpointed a series of further problems in the
field of education and training which should, the ESC believes,
be addressed without delay.

2.2.6.
Non-EU citizens legally resident in an EU Member
State (e.g. as workers or the spouses of EU citizens) already
have to contend with a great variety of problems; these
problems are drastically exacerbated when the persons
involved move to another EU Member State. Although the
problems with non-EU nationals posted to a Member State by
enterprises from another Member State are close to being
solved, many problems affecting freedom of movement for
workers remain unresolved. Workers legally resident in a
Member State frequently find themselves nonetheless denied
access to particular jobs which are reserved for citizens of the
host country and other EU Member States. Consideration of
all the problems facing non-EU citizens would go beyond the
scope of this opinion. The ESC would however point out that
the problems arising in this connection must be resolved
through closer coordination of migration policy by the EU. If
immigration of non-EU citizens into individual EU Member
States is regarded as a common policy area for the EU, it then
inevitably follows that the problems arising for the persons
concerned will also have to be tackled on an EU-wide basis.
The aim must be to enable legal immigrants to benefit, on an
equal footing, from the freedoms available in the EU.

2.2.7.
There are a number of problems standing in the way
of achievement of true freedom of movement for workers; one
of the problems which has been discussed for the longest time
and caused the greatest difficulty is the earning of rights in
another country and the possibility of transferring the earned
rights under different collective pension schemes, including
supplementary pensions. Solutions must again be sought to
this problem, both as regards freedom of movement among
the existing fifteen Member States and to ensure such mobility
for the applicant countries, too.

2.3.
The impending enlargement of the EU also prompts
the ESC to reiterate its call to the EU bodies to address issues
and problems arising in connection with cross-border migrant
workers and freedom of movement as a matter of priority and
to put forward solutions as soon as possible.

3. Urgent nature of the opinion

3.1.
In view of the large-scale EU enlargement planned for
the near future and the structural differences between the
existing EU Member States and the applicant states, increased
use will be made of the right to free movement and the right
to take up employment as a migrant worker in whatever way.

3.2.
Even today in the EU-15 there are still a number of
unsolved problems with regard to social security, taxation,
discrimination, the recognition of training and service periods
and qualifications and cooperation between the social, legal
and police authorities in the Member States.

3.3.
Tax legislation poses problems, in particular, for people
going to work abroad and leaving their families at home. Such
workers are often treated differently to nationals of the country
where they work. This discrimination ranges from non-
recognition of a second place of residence to failure to take
account of children.

social

security

field of

Despite the fact that EU provisions have long existed
3.4.
in the
(such as Regulation
1408/71/EEC (2)), the different types of systems mean that
there are still a number of unsolved problems affecting workers
wishing to make use of the right to free movement and
members of their family staying in their country of origin; the
field in which such problems occur is sickness insurance.
Although the Regulation has generally proved its worth,
problems do arise in particular in cases where tax-funded
schemes and schemes funded by contributions are jointly
involved. Problems also occur, particularly for pensioners, in
cases where given social security benefits are not available in
their country of origin.

3.5.
The problems already existing in the EU in its current
form, as a result of the difficulty in bringing 15 different social
security and taxation systems into line with each other, will be
exacerbated by the accession of the applicant states.

The problems raised in the 1997 Veil Report and in
3.6.
the ESC opinions have only been partially solved. It is vital to
rectify the unsolved problems, with a view to — and prior to
— the accession of the applicant states, since it is likely to be
much more difficult to find solutions subsequently. It is also
in the interests of the people concerned in the applicant states
that reliable and practicable rules exist and advisory and
information facilities are in place prior to the introduction of
freedom of movement. The applicant states themselves will
also be spared needless expenditure if the necessary changes
are made to the existing body of EU legislation before their
accession.

(1) Press release: 12928/00 (Press 420), dated 9.11.2000.

(2) OJ L 149, 5.7.1971, p. 2.

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3.7.
Although the single market as an economic entity has
been virtually completed in many areas, much ground still has
to be made up as regards the combating of abuse. The wars
being waged against illegal employment, social security benefit
fraud, evasion of income tax and social security contributions
and illegal practices relating, in particular, to the posting of
workers make this abundantly clear.

3.7.1.
It is virtually impossible for the courts and prosecut-
ing authorities in the host country to enforce civil-law
judgements and impose fines on labour-brokers or posting
enterprises in a worker’s country of origin who have been
found guilty of acting illegally. This is because of the lack of
EU provisions. It is thus generally impossible to obtain reliable
data on enterprises in a worker’s country of origin and the
social security contributions actually paid since there is no
European business register or joint European database for
social security organisations.

3.7.2. Workers recruited by dishonest employers or place-
ment bodies to work in other Member States find it virtually
impossible to claim their entitlements. This applies particularly
in cases where workers are unable to find subsequent employ-
ment and join a trade union in the host country. Language
barriers and difficulties encountered in continuing to pursue
legal action once workers have returned to their country of
origin help to prevent such fraudulent practices from being
stamped out. A further contributory factor is the lack of
cooperation between police authorities and the lack of recipro-
cal recognition of judgements and fines. Organised crime is
exploiting these shortcomings more and more frequently. A
solution needs to be found as a matter of urgency. Consider-
ation should be given to establishing a European body to help
workers claim their entitlements.

4. Conclusions — need for regulation

4.1. Framework conditions

4.1.2. F r e e d o m o f m o v e m e n t

i n t h e e n l a r g e d

E U

4.1.2.1.
The aim is to establish complete freedom of
movement for workers, without any discrimination, in the
enlarged EU. In order to ensure continued acceptance of
freedom of movement for workers, even after EU enlargement,
measures will need to be taken to organise the expected
migratory movements in terms of timing and the regions and
sectors to be included. Steps must be taken to ensure that the
migration potential in the applicants states is not concentrated
on a small number of neighbouring EU Member States.

Complete freedom of movement for workers in
4.1.2.2.
regions situated on the EU’s present external frontiers,
in
particular, must not be introduced without a transitional
period in order to avoid the possibility of local economic and
social upheaval. Given the particularly large discrepancies in
purchasing power and wage levels, there is a very considerable
danger that cross-border commuters from the applicant states
will accept wages which would not provide them with a living
wage if
their place of work; this will put
local workers out of a job and distort competition between
enterprises, which could, in turn, make freedom of movement
for workers no longer acceptable.

they lived at

Insofar as interim measures to curtail

Generally speaking, however, the EU must not
4.1.2.3.
allow its actions to be dictated by a defensive strategy, if we
are to achieve dynamic economic development in the applicant
states.
freedom of
movement for workers and freedom to provide services are
deemed necessary, the following approach should be adopted:
the deadlines set should differentiate between different regions
and sectors; criteria should be set out providing for a regular
review of the situation and appeal clauses should be agreed
upon, with a view to ensuring flexibility in the implementation
of the measures.

4.1.1. I m m i g r a t i o n — a
M e m b e r S t a t e s

j o i n t

t a s k f o r

a l l

4.1.3. C o m p a r a b i l i t y a n d a v a i l a b i l i t y o f
d a t a h e l d b y s o c i a l s e c u r i t y b o d i e s

t h e

The ESC thinks that

4.1.1.1.
immigration has already
become an issue which can only be tackled jointly. EU-wide
freedom of movement for non-EU nationals who have been
legally resident in one Member State and the labour-market
disruptions caused by illegal immigration into a Member State
(e.g. Mediterranean states or states along the EU’s present
eastern border) are ultimately matters of common concern to
all the Member States. There is therefore an urgent need to
step up the coordination of immigration policy.

4.1.3.1.
The ESC proposes that consideration be given to
the establishment, in the long term, of a joint database for
social security bodies at EU level in order to (a) help workers
document
their employment and contribution periods,
(b) clamp down on illegal practices, and (c) facilitate the work
of
the welfare and inspection authorities. The proposed
database should cover employment data, contributions paid
and benefits drawn. Attention should be paid to the need to
ensure data protection in this context.

29.5.2001

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Official Journal of the European Communities

C 155/53

4.1.3.2.
The ESC recognises that it would not be possible
to set up such a joint database in the short term in view of the
costs and the different types of systems. Steps should, however,
be taken to move towards this goal. As an interim measure, a
machine-readable social security card, conforming to a uni-
form EU pattern and containing these data, should first be
introduced (1).

4.1.4. M a k i n g d a t a

f r o m n a t i o n a l b u s i n e s s

r e g i s t e r s a v a i l a b l e

job-seekers,

Although the single market has been almost fully
4.1.4.1.
established,
labour-brokers,
inspection bodies,
legal representatives, business partners, customers and the
courts have so far only been able with difficulty, and at the
cost of much time and considerable expense, to obtain reliable
information on the registered office, the registered owner and
the current status (whether they are still listed or whether they
are already in receivership) of enterprises in other Member
States. A small minority of dishonest enterprises are exploiting
these shortcomings in a large variety of ways, e.g. for the
fraudulent recruitment of workers.

The ESC therefore proposes, as an interim measure,
4.1.4.2.
that EU-wide rules be adopted on (a) the minimum data to be
collected when businesses are registered by the Member States
and (b) the exchange and release of such data when required
by other Member States. In the long term, consideration
should also be given to linking national business registers to
form a publicly accessible European database.

4.1.5. I m p r o v i n g t h e a d v i s o r y s e r v i c e s p r o -

v i d e d f o r e m i g r a n t s a n d i m m i g r a n t s

4.1.5.1.
A uniform certification scheme should be intro-
duced throughout the EU for reputable providers of advisory
services to Union citizens wishing to migrate and providers of
special services, such as cross-border placements. The aim
should be to exclude untrustworthy service-providers lacking
the requisite specialised knowledge and to shield Union citizens
from operators charging high fees for services provided free or
for a small fee by public bodies or non-profit organisations.
The ESC therefore proposes the introduction of a Directive
stipulating that such services may only be provided by

(1) Cf. also the similar proposal put forward for consideration in the
Veil Report that the computerised cards issued by the respective
national social security bodies be made readable in all Member
States (loc. cit. p. 53).

accredited non-profit organisations or public bodies. At the
very least there should be an EU-wide ban — obtained by
transposing the relevant ILO rules into EU law — on the
charging of placement fees to workers by private service-
providers.

The ESC urges the Commission to play an even
4.1.5.2.
more active role in the establishment and promotion of an
advisory and support network for migrants to supplement
EURES. The ESC welcomes the fact that the EU is already
providing considerable funding in this area, but sees a need
for additional
funding, particularly in the context of EU
enlargement. Providing know-how and the information actu-
ally required for the advisory and support services is just as
important as the funding itself.

4.1.5.3.
The aim must be to achieve closer interplay
between the work of public advisory and placement bodies,
trade unions, welfare associations, chambers of trade and
industry and other non-profit organisations. Since the work of
NGOs in this field actually constitutes a public service,
it
should be subsidised. In particular, financial assistance should
be provided by the EU and national administrations for the
appointment of special advisors and for the production,
translation and distribution of information material.

4.1.6. I m p r o v e m e n t s t o E U R E S

There is still a need for substantial
improvements to the
publicity given to the work of EURES and its level of
professionalism. The ESC would expressly refer in this context
to proposals to this end made in the Veil Report and would
welcome an even more dynamic publicity and information
campaign.

4.1.6.1.
The information provided by EURES needs to be
considerably enhanced and made more readily accessible.
When vacancies are publicised via EURES, concise information
should be provided about the wages, whether or not the post
is temporary, working hours, place of employment and any
requirements as regards languages and qualifications.

4.1.6.2.
EURES should seek to cooperate still closer with
the social partners, particularly at national and sectoral level,
in order to obtain the up-to-date information required and
provide persons seeking information with the most accurate
possible picture of requirements and living and working
conditions in other EU Member States.

4.1.6.3.
Under Directive 68/1612/EEC, at least all vacancies
for long-term posts or posts of unlimited duration held by
national placement services and available online should also
be published, as a matter of course, by EURES. The ESC
welcomes the fact that the Commission has recently started to
try to achieve this goal.

C 155/54

EN

Official Journal of the European Communities

29.5.2001

4.1.7. M a k i n g p e n a l t i e s a n d f i n e s m o r e r e a d i -

l y e n f o r c e a b l e

Steps should be taken to ensure the enforcement throughout
the EU of,
in particular, penalties and fines imposed on
employers for failing to meet their legal obligations in respect
of, for example, payment of the minimum wage and social
insurance contributions. The aim of such measures is to make
it possible to take effective action against dishonest employers,
particularly those engaged in the posting of workers. The ESC
proposes that a Directive be adopted on this matter to replace
the few existing bilateral agreements.

4.2. Other proposed measures

4.2.1.
The ESC proposes that the Commission keep its
Single Market Observatory (SMO) regularly briefed on the
following subjects and activities:

— coordination of the work of public bodies, EURES and

non-profit organisations;

— licensing of non-profit organisations providing advisory

services to migrants;

— coordination of material and financial aid for advisory

networks;

— analyses and statistics covering freedom of movement;

— assistance for the Member States and the social partners

on all matters relating to freedom of movement.

4.2.2. D i s c o n t i n u a t i o n

o f
o f
r e f u s i n g r e s i d e n c e t o d i s a b l e d p e r s o n s
r e q u i r i n g i n c o m e s u p p o r t a n d t o l o n g -
t e r m n o n - n a t i o n a l l e g a l r e s i d e n t s

p r a c t i c e

t h e

The ESC proposes the addition of the following provisions to
the relevant Directives:

Brussels, 28 March 2001.

— the submission of applications for income support by
long-term non-national residents may no longer be used
by Member State authorities as grounds for terminating
their residence;

— disabled persons’ supplementary income support needs
may no longer be used by Member State authorities as
grounds for refusing residence.

4.2.3. A u t o m a t i c i s s u e o f a p e r m a n e n t r e s i -
t o l o n g - t e r m l e g a l r e s i -

d e n c e p e r m i t
d e n t s

The ESC proposes that the existing rules be amended to
stipulate that workers and their families who are legally
resident in another Member State are to be automatically
issued with a permanent residence permit after no more than
five years without having to apply for one.

4.2.4. E s t a b l i s h i n g b e s t p r a c t i c e

for

In certain cases, solutions to some of the problems linked to
the free movement of workers has been found at decentralised
levels. The PRISM-database of
the Economic and Social
Committee’s Single Market Observatory lists some of these
instance the Euregio initiative, defending
solutions,
employees’ rights in the region through a collaboration of
trade unions in Belgium, the Netherlands and Germany, or
the voluntary agreement on Social Security Contributions,
organising holiday payments for the temporary labour force
moving from Germany to France and vice versa by creating a
simple administration system. A systematic listing of such
initiatives may be able to solve some of the outstanding
problems in the field.

The President

of the Economic and Social Committee

Göke FRERICHS

29.5.2001

EN

Official Journal of the European Communities

C 155/55

APPENDIX

to the Opinion of the Economic and Social Committee

1.

Percentage of the population (aged between 15 and 64) in gainful employment

EU15

B

DK

D

EL

E

F

IRL

I

L

NL

A

P

FIN

S

UK

1999

1998

1997

1996

1995

68,6 %

64,6 %

80,6 %

71,2 %

62,9 %

62,1 %

68,8 %

66,4 %

59,6 %

63,2 %

73,6 %

71,6 %

70,9 %

76,4 %

76,5 %

75,2 %

68,0 %

63,2 %

79,3 %

70,7 %

62,5 %

61,3 %

68,2 %

64,7 %

59,0 %

62,1 %

72,6 %

71,3 %

70,3 %

73,1 %

75,5 %

74,9 %

67,5 %

62,6 %

79,8 %

70,6 %

60,8 %

60,8 %

68,0 %

62,9 %

57,7 %

61,4 %

71,5 %

70,8 %

68,2 %

72,8 %

76,4 %

75,1 %

67,3 %

62,2 %

79,5 %

70,4 %

61,0 %

60,0 %

68,2 %

62,3 %

57,7 %

61,2 %

69,9 %

71,1 %

67,5 %

71,7 %

77,1 %

74,9 %

67,7 %

62,1 %

79,5 %

70,5 %

60,1 %

59,5 %

67,6 %

61,6 %

57,3 %

60,4 %

69,2 %

71,5 %

67,4 %

72,1 %

80,1 %

74,7 %

2.

Percentage of (1) above represented by nationals of the Member State

EU15

B

DK

D

EL

E

F

IRL

I

L

NL

A

P

FIN

S

UK

1999

1998

1997

1996

1995

65,3 %

58,9 %

78,6 %

64,9 %

60,5 %

61,4 %

64,5 %

64,1 %

59,0 %

36,8 %

71,1 %

64,7 %

68,9 %

75,5 %

73,3 %

72,3 %

64,7 %

58,1 %

77,2 %

64,6 %

60,1 %

60,7 %

64,0 %

62,6 %

58,5 %

36,5 %

70,0 %

64,2 %

69,3 %

72,3 %

72,2 %

71,8 %

64,3 %

57,7 %

77,8 %

64,4 %

59,5 %

60,3 %

63,8 %

60,7 %

57,4 %

36,4 %

68,9 %

63,6 %

67,5 %

72,1 %

72,9 %

72,2 %

64,1 %

57,1 %

77,7 %

64,1 %

59,9 %

59,5 %

63,9 %

60,1 %

57,4 %

36,7 %

67,3 %

64,1 %

66,7 %

71,1 %

75,5 %

72,2 %

64,5 %

57,2 %

78,0 %

64,1 %

59,1 %

59,0 %

63,3 %

59,7 %

57,0 %

36,7 %

66,5 %

64,6 %

66,8 %

71,6 %

76,8 %

72,0 %

C 155/56

EN

Official Journal of the European Communities

29.5.2001

3.

Percentage of (1) above represented by nationals of another EU Member State

EU15

B

DK

D

EL

E

F

IRL

I

L

NL

A

P

FIN

S

UK

1999

1998

1997

1996

1995

1,3 %

4,1 %

0,8 %

2,2 %

0,2 %

0,2 %

1,7 %

1,8 %

0,1 %

1,3 %

3,7 %

0,7 %

2,2 %

0,2 %

0,3 %

1,7 %

1,7 %

0,1 %

1,3 %

3,7 %

0,7 %

2,2 %

0,1 %

0,2 %

1,8 %

1,9 %

0,1 %

1,2 %

3,8 %

0,7 %

2,2 %

0,1 %

0,2 %

1,7 %

1,8 %

0,0 %

1,2 %

3,4 %

0,7 %

2,0 %

0,1 %

0,2 %

1,7 %

1,5 %

0,1 %

23,9 %

22,7 %

22,9 %

21,9 %

21,8 %

1,3 %

1,2 %

0,3 %

0,2 %

1,4 %

1,3 %

1,1 %

1,2 %

0,3 %

0,1 %

1,4 %

1,3 %

1,3 %

1,0 %

0,1 %

0,1 %

1,6 %

1,3 %

1,3 %

0,9 %

0,1 %

0,1 %

1,6 %

1,2 %

1,2 %

0,8 %

0,2 %

0,1 %

1,7 %

1,2 %

4.

Percentage of (1) above represented by non-EU nationals

1999

1998

1997

1996

1995

EU15

B

DK

D

EL

E

F

IRL

I

L

NL

A

P

FIN

S

UK

Source: EUROSTAT 2000.

2,0 %

1,6 %

1,2 %

4,1 %

2,3 %

0,5 %

2,5 %

0,5 %

0,5 %

2,5 %

1,2 %

5,7 %

0,7 %

0,7 %

1,7 %

1,6 %

2,0 %

1,4 %

1,5 %

3,9 %

2,2 %

0,4 %

2,5 %

0,4 %

0,4 %

2,5 %

1,4 %

5,9 %

0,7 %

0,6 %

1,9 %

1,8 %

1,9 %

1,2 %

1,3 %

4,0 %

1,2 %

0,3 %

2,4 %

0,3 %

0,3 %

2,1 %

1,3 %

6,2 %

0,6 %

0,6 %

1,8 %

1,6 %

1,9 %

1,3 %

1,1 %

4,1 %

1,0 %

0,3 %

2,7 %

0,5 %

0,2 %

2,5 %

1,4 %

6,1 %

0,7 %

0,5 %

NA

1,5 %

2,0 %

1,5 %

0,9 %

4,4 %

0,9 %

0,3 %

2,5 %

0,4 %

0,2 %

1,8 %

1,5 %

6,1 %

0,5 %

0,4 %

1,7 %

1,5 %