Daily Management Review

Majority of EU countries support the labor market reform


Most of the countries of the European Union (EU) have agreed to reform the union’s labor rules, although many of the less wealthy countries of the bloc use them as a competitive advantage, Reuters writes.

Steven Depolo
Steven Depolo
The issue of has led to a split between the rich and poor EU countries, since the latter are in favor of maintaining the current rules. According to these rules, workers from these countries can apply for jobs in the EU with a higher salary than they receive in their native country. At the same time, their salary remains lower than that of local residents.

Macron raised the issue of reforming the so-called publication of working directives on the EU agenda. In particular, he was supported by Germany, Belgium, Luxembourg and the Netherlands.

After 12 hours of negotiations between the Ministers of Labor in Luxembourg, the majority of the members of the 28 EU countries supported a compromise that would restrict the deployment of workers abroad for 18 months and introduce a four-year transition period between the final reform agreement and its entry into force.

Hungary, Lithuania, Latvia and Poland said they could not support this proposal, while Ireland, Britain and Croatia abstained amid fears that the new regulations would damage their transport industries.

"Europe is moving forward, and I welcome the ambitious agreement on the posted workers: more protection, less fraud," Macron wrote in a Twitter message late Monday night.

The Dutch minister highly appreciated the deal, saying that all employees deserve protection from unfair competition. His Hungarian colleague said that the final text was vague and left too many possibilities for interpretation.

Spain, Ireland, Portugal and several countries from Eastern Europe wanted them to obey a separate law. In the latter group, Poland is the largest exporter of cheap labor in the EU.

The executive commission of the bloc eventually stated that part of the transport sector, namely transit, would not be regulated by the rules of accommodation.

"The transport sector is a special case because of the mobile nature of the industry, (and) there are several texts on the sector under discussion, which will describe in detail how this will be applied," the official said in the office of the French president.

While one camp says that cheap labor has a negative impact on wages and undermines the labor market, another camp believes that tightening rules is reduced to protectionism and a weakening of competition.

"This is fairness in the labor market," said Marianne Thiessen, representative of EU top managers, "I advocate freedom of movement, but it must be organized honestly ... The domestic market is based on rules, it's not a jungle."

Poland, the Czech Republic, Romania and other eastern countries say that they should be allowed to compete with lower wages in order to catch up with the rich countries of the West after decades of communist rule.

source: reuters.com