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 transparent and predictable working conditions in the European Union
Date: 2017-12-21
Institutions: Directorate-General for Employment, Social Affairs and Inclusion, European Commission
Subjects: EU employment policy, collective agreement, dismissal, probationary period, work contract, worker information, working conditions

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  EN 

   EUROPEAN COMMISSION  Brussels, 21.12.2017  SWD(2017) 479 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 transparent and predictable working conditions in the European Union {COM(2017) 797 final} - {SWD(2017) 478 final}  
 
 
Impact  Assessment  on  Proposal  for  a  Directive  on  Transparent  and  Predictable  Working  Conditions  in  the 
European Union 

Executive Summary Sheet 

Why? What is the problem being addressed?  

A. Need for action 

The  problem  relates  to  the  risk  of  insufficient  protection  for  workers,  including  those  in 
new  and  non-standard  forms  of  employment,  in  the  context  of  the  necessary  labour 
market adaptability. A REFIT evaluation1 and a public consultation on the European Pillar of 
Social  Rights2  revealed  that:  (1)  some  workers  do  not  receive  a  written  statement;  (2)  the 
information  provided  by  employers  may  be  insufficient  and/or  provided  too  late;  (3) 
strengthened enforcement could help implementation; (4) an increased lack of predictability; (5) 
insufficient  access  to  mandatory  training;  (6)  varying  levels  of  protection  among  Member 
States, coupled with less transparency on the labour market.  

What is this initiative expected to achieve?  

The  overall  aim  is  to  promote  more  secure  and  predictable  employment  while  ensuring 
labour  market  adaptability.  The  intiative  aims  to  improve:  (1)  information  on  working 
conditions;  (2)  working  conditions  for  all  workers,  notably  in  non-standard  forms  of 
employment, while leaving scope for labour market adaptability; (3) compliance with working 
conditions standards; and (4) labour market transparency while avoiding excessive burdens on 
business. 

What is the value added of action at the EU level?  

The  multiplication  of  forms  of  work  requires  additional  minimum  standards  to  support  equal 
treatment  of  workers,  a  level  playing  field  across  the  EU,  and  upward  convergence  in 
employment and social outcomes. Given labour market developments since 1991, the Directive 
is  no  longer  fully  adequate.  The  changes  to  the  Directive  needed  to  rectify  these 
shortcomings can only be made at EU level.  

1  REFIT  Evaluation 
of  Directive 
http://ec.europa.eu/social/main.jsp?catId=706&langId=en&intPageId=202 
2 SWD(2017)206 Report of the public consultation Accompanying the document Establishing a European Pillar 
of Social Rights 

91/533/EEC, 

SWD(2017) 

final, 

205 

of 

26.04.2017;     

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B. Solutions 

What legislative and non-legislative policy options have been considered? Is there a preferred choice or 
not? Why?  
The following measures have been considered: (1) A broader scope of application to cover 
all EU workers; (2) The right to fuller and updated information; (3) Shortening the deadline 
to  the  first  day  of  employment  or  before;  (4)  New  minimum  rights  for  all  workers;  (5) 
Strengthened enforcement.. 
The new rights (measure 4) are:  
  Right to greater predictability for workers whose work schedule is mostly variable: (i) 
Right to predefined reference days and hours (ii) Right to a reasonable advance notice 
before a new assignment  

  Right to employment in parallel (ban on exclusivity clauses) 
  Right to request another form of employment and receive a written reply 
  Right to a maximum duration of probation period 
  Right  to  cost-free  training  as  required  in  EU  legislation,  national  legislation  or 

collective agreements. 

The preferred option is a combination of all the above measures, as most suited to achieve 
the policy objectives. 

Who supports which option?  

The  preferred  option  is  most  closely  aligned  with  the  European  Pillar  of  Social  Rights 
proclaimed by the Council, the European Parliament and the Commission. 
It is the closest to the requests of the Parliament and the workers' organisations during the 
consultation  process  under  Article  154  TFEU.3  To  address  concerns  of  employers,  the 
Commission discarded some avenues of action proposed in the first stage consultation and 
did  not  pursue  certain  proposals  of  the  workers'  organisations.  The  preferred  option 
balances  the  essential  protection  for  workers  with  the  adaptability  for  job  creation  and 
labour market innovation. 

What are the benefits of the preferred option (if any, otherwise main ones)?  

C. Impacts of the preferred option 

A  substantial  improvement  in  working  and  living  conditions  is  expected.  At  least  2-3 
million non-standard workers will come under the scope of the Directive. 8-16 million will 
start  a  new  job  with  clear  information  on  rights  and  obligations.  Better  predictability  for 
some  4-7  million  workers  should  improve  their  work-life  balance  and  health.  Some  14 
million  workers  might  request  a  new  form  of  work.  Without  exclusivity  clauses  some 
91,000-364,000 on-demand workers may seek additional work and earn 355-1,424 million 
EUR  per  year  extra.  Workers'  right  to  receive  cost-free  mandatory  training  would  be 
confirmed and they would have easier access to means of redress. Employers would benefit 

3  The  Commission  took  note  of  the  Parliament's  call  for  establishing  a  new  framework  directive  on  decent 
working  conditions  but  considered  that  at  this  stage  a  more  proportionate  approach  lies  in  a  more  targeted 
instrument,  taking  into  account  the  existing  legal  basis,  the  diverging  views  of  the  social  partners  and  the 
obligation in Article 153(2) TFEU. 

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thanks  to  more  sustainable  competition,  increased  legal  certainty  and  an  overall 
improvement in transparency on the labour markets. Without exclusivity clauses, workers 
will be available to work for other employers, which might generate some 42-167 million 
EUR annual revenues for those employers. Non-quantified benefits for employers include 
higher  employee  retention  and  loyalty,  healthier  working  relations,  fewer  complaints  and 
court cases and better resource planning, all of which will contribute to an overall increase 
in productivity.  

What are the costs of the preferred option (if any, otherwise main ones)?  

No significant costs for workers. For employers: the cost of issuing a new or revised written 
statement is expected to be 18-153 EUR for SMEs and 10-45 EUR for larger  companies. 
Companies would also have one-off costs related to familiarisation with the new Directive: 
an average of 53 EUR for an SME and 39 EUR for a larger company. Costs of responding 
to requests for a new form of employment are expected to be similar to those deriving from 
issuing  a  new  written  statement.  Employers  anticipate  some  modest  indirect  costs  (legal 
advice,  revised  scheduling  systems,  HR  management  time,  information  for  staff  etc.). 
Flexibility will only be lost at the margin (i.e. for the small proportion of employers making 
extensive use of the most flexible forms of employment). No significant aggregate impacts 
on  wages  are  expected,  though  individuals  would  gain  the  capacity  to  earn  more  through 
reduced underemployment and more predictable working conditions.  

How will businesses, SMEs and micro-enterprises be affected?  

SMEs  will  likely  spend  somewhat  more  per  written  statement  and  might  have  higher 
familiarisation  costs.  The  overall  impact  of  the  measures  will  however  depend  on  a 
company's business model rather than size (e.g. extent of reliance on non-standard work). 
Templates  could  allow  for  savings  (30-40%  per  written  statement  provided)  and 
particularly facilitate compliance in SMEs. A lighter regime for SMEs in case of requests 
for a new form of employment is expected to diminish the cost for SMEs. 

Will there be significant impacts on national budgets and administrations?  

Modest costs for the adaptation of Member States' legal frameworks. Some costs related to 
enhanced  enforcement.  Overall,  a  reduction  in  undeclared  work  can  be  expected  as  the 
proposed  measures  facilitate  inspection  and  enforcement.  Additional  tax  revenues  and 
savings on social security payments can be expected: tax revenues related to the prohibition 
of  exclusivity  clauses:  46-185  million  EUR  per  year;  undeclared  work  moved  to  formal 
economy:  8-25  million  EUR  per  year  in  tax  revenues;  4-24  million  EUR  per  year  in 
reduced social security payments. 

Will there be other significant impacts?  
A  more  uniform  scope  of  application  and  clearer  information  on  working  conditions  will 
support mobility both within the national labour markets and across the EU. A reduction in 
undeclared work can be expected. A significant contribution to fundamental rights can be 
expected notably concerning the freedom to choose an occupation and the right to engage in 
work,  equality  between  men  and  women,  and  the  right  to  effective  remedy  and  access  to 
justice.  

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When will the policy be reviewed?  

D. Follow up 

The  Commission  will  monitor  implementation  in  the  Member  States  and  review  the 
Directive in consultation with the Member States and social partners at EU level, ensuring 
a  sufficiently  long  period  to  evaluate  the  effects  of  the  initiative  after  it  has  been  fully 
implemented.  

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