COMMISSION STAFF WORKING DOCUMENT EXECUTIVE SUMMARY OF THE IMPACT ASSESSMENT Accompanying the document Proposal for a Directive of the European Parliament and of the Council on work-life balance for parents and carers and repealing Council Directive 2010/18/EU
Date: 2017-04-26
Institutions: Directorate-General for Employment, Social Affairs and Inclusion, European Commission
Subjects: EU employment policy, equal treatment, flexible working hours, gender equality, integration into employment, labour law, labour market, leave on social grounds, sexual discrimination, working conditions

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   EUROPEAN COMMISSION  Brussels, 26.4.2017  SWD(2017) 203 final   COMMISSION STAFF WORKING DOCUMENT  EXECUTIVE SUMMARY OF THE IMPACT ASSESSMENT  Accompanying the document Proposal for a Directive of the European Parliament and of the Council  on work-life balance for parents and carers and repealing Council Directive 2010/18/EU    {COM(2017) 253 final} {SWD(2017) 202 final}  
 
 
Impact  assessment  accompanying  the  document  'A  'New  Start'  to  Support  Work-Life  Balance  for 
Parents and Caregivers' 

Executive Summary Sheet 

Why? What is the problem being addressed?  

A. Need for action 

As  outlined  in  the  Roadmap  of  this  initiative1,  the  problem  to  be  addressed  is  women’s  under-
representation  in  employment,  particularly  due  to  the  lack  of  equal  sharing  of  caring  and 
professional responsibilities by parents with children or those with dependent relatives. In 2015 
the  gender  employment  gap  (age  20-64)  in  the  EU  amounted  to  11.6  percentage  points  (pps).  This 
initiative  aims  to  address  the  problem  of  the  underrepresentation  of  women  in  the  labour  market  by 
addressing one of its main drivers, which is the unequal distribution of caring responsibilities between 
women and men. Gender gaps in the labour market are most acute for parents  and people with other 
caring responsibilities. The gender employment gap has been shown to widen substantially after having 
children.  On  average  in 2015,  the  employment  rate  of  women  with  one  child  under  6  is  8.8  pps  less 
than women without young children, and in several countries this difference is over 30 pps2 . Similarly, 
women are much more likely to assume the role of informal carers for elderly or dependent relatives 
than  men3.  One  of  the  main  reasons  for  this  problem  is  inadequate  work-life  balance  policies. 
Insufficient possibilities to take leaves to care for children/dependent relatives, the design of the leave 
system  which  hinders  a  better  sharing  of  caring  responsibilities  between  women  and  men,  limited 
possibilities to make use of flexible working arrangements, and insufficient formal care services have 
all  been  shown to  excerbate the female employment challenges. Economic disincentives (such as  the 
disincentives for second earners which mostly affects women) can further reinforce the unequal sharing 
of  caring  responsibilities  by  women  and  men  and  act  as  a  reinforcing  driver  of  the  gender  gap  in 
employment.  

What is this initiative expected to achieve?  
The general policy objective of this initiative is to address women's underrepresentation in the labour 
market and to promote equality between men and women with regard to labour market opportunities by 
modernising the current EU legal and policy framework and adapting it to today’s labour market. This 
will  allow  parents  with  children  or  workers  with  dependent  relatives  to  better  balance  caring  and 
professional responsibilities4. 
The specific objectives of this initiative are therefore defined as follows: 

 

 

to improve access to work-life balance arrangements – such as leaves and flexible working 
arrangements 
to increase take-up of family-related leaves and flexible working arrangements by men 

It  should  be  noted  that  some  aspects  related  to  the  problem  to  be  addressed  are  not  covered  in  this 

1 European Commission (2015), Roadmap: A new start to address the challenges of work-life balance faced by 
working families 
2 Gender gaps in employment are 24.7 pp among those with 1 child below 6 years of age, 25.6 pp among those 
with 2 children (youngest below 6 years of age) and 35.4 pp for those with three children or more. 
3   See  for  instance  European  Commission  (2013)  Long  term  care  in  ageing  societies;  Eurofound  (2016)  The 

Gender Employment Gap: Challenges and Solutions 

4 Article 153(1) (i) TFEU: " equality between men and women with regard to labour market opportunities and 
treatment at work. 

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impact assessment. With regard to the provision of formal care services and 'economic disincentives, 
this is due to the limited EU competence in these areas. Considering their significant influence on the 
addressed  problem,  the  initiative  could  foresee  measures  to  enhance  current  efforts  in  these  areas,  in 
particular in relation to the monitoring of Member States' policies in the EU Semester and to the use of 
EU funding in the case of formal care services. 

What is the value added of action at the EU level?  
EU action has a strong added-value in addressing the challenges mentioned in the problem definition.  
First, the current situation demonstrates that EU action has a strong influence on Member States' legal 
frameworks. In the policy area covered by this initiative, it is only when EU legislation is in place (i.e., 
maternity and parental leave) that there is legislation in place in every Member State. When  Member 
States  do  have  legal  entitlements,  variations  between  Member  States  with  regard  to  length  and  the 
generosity of the conditions could result in an unbalanced level of rights, an unequal protection for EU 
citizens across the EU and differences in the functioning of labour markets. Secondly, the projections 
based on the available information clearly demonstrate that only EU action will ensure that sufficient 
progress is achieved in all Member States. Employers, particularly small and medium-sized enterprises, 
may be hesitant to provide greater work-life balance measures on their own, given the short-term costs 
and  administrative  burdens  that  may  result5.  Member  States  may  hesitate  to  correct  such  a  failure 
through regulation in this area because they may perceive a risk of putting their own companies at a 
disadvantage with companies from other Member States. Considering that a significant percentage of 
EU firms' trade is intra-EU, EU-level action could mitigate such concerns and establish a level-playing 
field while taking into account the need to avoid additional burdens on businesses, particularly SMEs, 
and ensuring that all Member States move in the same direction. Thirdly, EU-level intervention could 
mitigate trends  in  some Member-States to  reduce  work-life  balance provisions. Indeed, as  a result  of 
the recent crisis, policy priorities diverge between Member States, and other issues (particularly those 
expected to produce short-term benefits) are focussing national authorities' attention.  Finally, there is a 
clear  European  horizontal  dimension 
the 
underrepresentation of women in the labour market. Low labour market participation of women hinders 
the EU's goals in relation to gender equality, fighting poverty and supporting employment and growth. 

to  work-life  balance  and 

issues  related 

the 

to 

B. Solutions 

What  legislative  and  non-legislative  policy  options  have  been  considered?  Is  there  a  preferred 
choice or not? Why?  

A  range  of  non-legislative  and  legislative  measures  have  been  considered  in  the  following  areas: 
maternity leave, paternity leave, parental leave, carers’ leave and flexible work arrangements.  

Following  an  assessment  of  the  effectiveness,  efficiency  and  coherence  of  each  option,  a  preferred 
combination of options was identified. The preferred combination includes: 

  Maternity leave: non-legislative measures to enhance the enforcement of current legislation on 
dismissal  protection,  raise  awareness  on  the  dismissal  of  pregnant  women  and  give  policy 
guidance  on  facilitating  successful  transitions  between  maternity  leave  and  employment 
(including breastfeeding facilities and breaks) 

5 OECD (2007) Babies and Bosses 

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  Paternity leave: introduction of an individual entitlement for 10 working days,  paid at least at 

sick pay level 

  Parental leave: individual non-transferable entitlement of 4 months paid at least at sick pay level 
to be taken for each child up to the age of 12 ; right to flexible uptake (part-time, piecemeal),  
  Carers' leave: introduction of an individual entitlement of 5 days/year, paid at least at sick pay 

level 

  Flexible  working  arrangements:  right  for  parents  of  children  up  to  12  and  carers  to  request 
flexibility in working hours, schedule or place of work for a set period of time. The employer 
has no obligation to grant the requested change. 

Who supports which option?  
Trade unions have indicated their desire for EU-level legislation on paternity leave and carers’ leave; 
increasing  the  length,  pay  and  dismissal  protection  for  maternity  leave;  a  right  to  request  flexible 
working  arrangements;  and  amending  the  parental  leave  directive  to  extend  the  length  and  non-
transferability as well as to introduce payment for the leave. 
Employers’ organisations are not favourable to further EU legislative action. 
The European Parliament has called for extending the duration of parental leave and introducing pay, 
as well as introducing paternity leave and carers’ leave. 
Many other stakeholders have also called for increased EU legislative and non-legislative action in the 
area of work-life balance.  

C. Impacts of the preferred option 

What are the benefits of the preferred option (if any, otherwise main ones)?  
The estimated benefits of the preferred combination of options are summarised as follows: 
- Individuals: the leave and flexible working arrangement provisions should positively impact parents 
and carers' work-life balance and well-being, the sharing of caring responsibilities between women and 
men, female participation in the labour market and lead to a decrease in the risk of poverty for women 
and children.  
- Companies: by increasing women employment the combination of options would enable employers to 
benefit from a wider pool of talented skilled workers and by increasing work-life balance for parents 
and  carers,  this  would  lead  to  an  increase  in  workers'  productivity.  Provisions  on  leave  and  flexible 
working arrangements will lead to a decrease in replacement costs (by €100 bn) and in absence from 
work (which will lead to a benefit of € 23 bn) between 2015-2055 (NPV). 
- Central Governments and Social Security: the combination of options would lead to a decrease in the 
payment of unemployment benefits (+ €18 bn) an increase in tax revenue (+ €381 bn) and a decrease in 
health care expenditure (by € 2 bn) between 2015-2055 (NPV). 
- Remote working arrangements, as part of the provision on flexible working arrangements, could also 
have a positive impact on the environment. 
- The combination of options is also expected to have a positive impact on GDP (€ 838.8 bn in NPV 
2015-2055)  and  on  employment  (>  1.5bn  in  2050),  labour  force  (>1.4bn  in  2050)  and  real  incomes 
(€120 bn in 2050). 

What are the costs of the preferred option (if any, otherwise main ones)?  
Over the period of 2015-2055, the estimated costs (in NPV) of the preferred combination of options are 
summarised as follows:  
- Companies: The combination of options will lead to adjustment costs (€3 bn), administrative costs (€ 
109  bn),  costs  due  to  benefit  payments  (€  27  bn),  recruitment  costs  (€7  bn)  and  costs  due  lost 
production (€144 bn). 

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- Central Government and Social Security: expected costs are mainly due to benefit payments (€14 bn 
for Central Governments and €41 bn for Social Security partners) and administrative costs (€1 bn for 
Central Government and €258 mil for Social Security partners). 
- The assessment reveals no direct negative impact on individuals, macro-economic figures or on the 
environment. 
How will businesses, SMEs and micro-enterprises be affected?  
No  specific  exemptions  for  SMEs  are  considered.  The  total  cost  of  the  options  for  micro-businesses 
represents a small share of the companies' total turnover (under 1% of turnover in most countries and 
under 3% in all countries), and very close to the level of cost under the baseline. Therefore the policy 
options do not disproportionately affect the performance of SMEs. 

Will there be significant impacts on national budgets and administrations?  
As outlined above, some options will have higher impacts on national budgets and administrations than 
others.  The  preferred  options  for  paternity  leave  and  parental  leave  entail  some  costs  for  central 
governments  due  to  benefit  payments  and administrative costs in  processing applications.  That being 
said, these options also have positive impacts on female employment, increased tax revenue, increased 
real incomes  and  consumption, and overall GDP. The preferred options for carers' leave and flexible 
working arrangements are estimated to have benefits for central governments. 
Will there be other significant impacts?  
All  options  would  facilitate  the  exercise  of  the  rights  recognised  in  Article  33  of  the  Charter  of  the 
Fundamental  Rights  of  the  European  Union,  which  specifically  refers  to  the  reconciliation  of  family 
and professional life. 

D. Follow up 

When will the policy be reviewed?  
The  Commission  will  review  and  evaluate  the  operation  and  impact  of  the  legislative  proposals  five 
years after the deadline for transposition and produce an implementation report.  
The  Commission  will  also  to  continue  to  regularly  monitor  female  employment  and  Member  States’ 
work-life balance provisions, including in the European Semester. 

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