Transcript Slide 1

European
Labour Law
Lecture 05A
5.1 Employment policies– general 1
Since the 1920s/1930s all modern states have
become aware of the necessity to direct state
politics to the employment situation. Socialism
and communism were the first to advocate this,
fascism and nazism followed suit and finally also
in liberal-capitalist societies (notably after the
Great Depression of the 1930s) the necessity of
economic policies to stimulate employment was
understood. After the Second World War the aim
of reaching full employment became an
indispensable part of all economic policies in all
Western-European countries. Also the theory of
Keynes about anti-cyclic macro-economic policies
was almost generally accepted.
5.1 Employment policies-general 2
Governments were used to deploy measures to
support employment by protecting national
business by
- national customs policies
- State aid and subsidies
- monetary policies (currency rates and interest
rates)
Keynes advised governments to use additional
instruments to fight unemployment, such as
- anti-cyclical budget policies
- stabilisation of wages and prices
5.1 Employment policies-general 3
However, let us not forget that the very aims of
the EEC/EU deprived the national authorities of
the MS of most of these instruments to stimulate
employment
Under EEC/EU law successively MS were no
longer able/allowed to stimulate their economies
by protecting national business through
- national customs policies
- State aid and subsidies
- monetary policies (currency rates and interest
rates)
- budget policies
5.1. Employment policies-general 4
In is clear that such a contradictory approach
(embracing the full employment aim and at the
same time yielding its instruments) could only be
justified, if employment policy making would
return at a higher level, that of the EEC.
In fact, the ECSC/EEC right from the start in the
1950s have been committed to the goal of a high
degree of employment, also in their treaty texts
(Art. 2 ECSC/Art. 2 EEC)
Now:
Art. 3(3) TEU - full employment
Art. 9 /art. 147 (2) TFEU– a high level of
employment
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However, these commitments were not translated
in a forceful bunch of competences.
In the 1950s the optimist liberals believed that the
market would do most of the job, so the treaties
right from the start did not give have EEC
institutions much competences to act to stimulate
employment. Employment policies were still
regarded as a primarily national matter.
There were some competences for EU
institutions, but they were weak:
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The Commission was charged to gather
information, to conduct labour market studies and
to consult and advise national governments and
social partners on employment matters (Art. 46
ECSC and Art. 118 EEC).
The Council of Ministers limited itself to
Resolutions and Recommendations.
And only after the first post-war economic
depression (1969) a Standing Committee on
Employment was set up, uniting representatives
of the Council, the Commission and the European
Social Partners. Its function was mere
consultative.
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The most forceful EEC instruments were on the
financial side:
- art. 56 ECSC
- The European Social Fund
However, even they were poorly entrusted with
resources.
Moreover there was a provision on vocational
training in the EEC Treaty.
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Since the end of the 1970s the EEC/EU has
suffered from a permanently high degree of
unemployment. An average of circa 10% of the
working population – in good years this figure
tends to reduce to ca. 9%, in economically hard
times it easily goes up to an average of 11%
The differences between the MS are formidable.
Actually The Netherlands is at the bottom with ca.
4% unemployment while Spain is on top with ca.
20%.
The EU figure almost constantly is higher than the
US figure.
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However, it was not earlier than in the 1990s that
time was ripe for a more powerful employment
policy at EU level.
The Treaty of Amsterdam, 1997, inserted a
Chapter on Employment policies in the EC Treaty.
Now art. 145-150 TFEU.
But even in this text the instruments are weaker
than in other chapters of the treaty.
Policies could only be carried through by way of
“Guidelines”, drawn up by the Council of Ministers
in accordance with its economic policy. (art.
148(2) TFEU.
Hendrickx C. p. 177-187.
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Even so, the Commission and the Council in
1997 launched ambitions employment policies
under the headings of
European Employment Strategy.
This strategy in 2002 was adapted to match the
so-called Lisbon-Agenda 2000: to make Europe in
2010 the most dynamic knowledge-based
economy of the world, capable of sustainable
economic growth with more and better jobs and
greater social cohesion.
It soon became clear that this was a too ambitious
ideal. In 2002 the EU economy entered a new
period of stagnation.
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A new attempt for forceful employment policies
was made in 2004 when Ministers adopted the
so-called Kok-report “Jobs, jobs, jobs, creating
more employment in Europe”.
After some years, however, the EU-economy
came again in a recession in 2008 as a result of,
first, the banking crisis and then the solvencycrisis of a number of Euro MS.
So the Lisbon-Agenda definitively has become a
failure.
Nevertheless the politicians fixed a new ambition
for the year 2020.
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Formally the employment ambitions are laid down
in yearly Decisions of the EU Council of Ministers
concerning guidelines for the employment policies
of the MS.
See for the most recent ones the Decision of the
Council 2011/308/EU of 19 May, 2011, OJ L 138
of 26 May, 2011.
They contain a high degree of authoritarian
language. MS must do this…and must do that.
However, they are devoid of any binding force!
MS most of the time find polite excuses why they
have not or only slightly followed the guidelines.
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It is largely a bureaucratic exercise in which the
MS are obliged to write yearly national reports
about their progress in implementing the
guidelines (art. 148 (3) TFEU).
On this basis the Council of Ministers may issue
Recommendations (art. 148(4) TFEU).
Also on this basis the Commission and the
Council of Ministers annually publish the Joint
Employment Report, assessing the EU situation
as well as the MS’s national reform programmes
(art. 148 (5) TFEU).
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The European institutions frequently set out a
number of typical pathways to help MS draw up
their own national strategies and learn from each
other’s experiences and best practices.
This is called the Open Method of Coordination.
However: these measures shall not include
harmonisation of the laws and regulations of the
MS!! (art. 149/150 TFEU).
Still, these policies guidelines have another
function: they serve as priorities for the
distribution of money via the European Social
Fund.
That is possibly their main relevance.
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So what are the main focal points of the EU
Employment Strategies nowadays?
- The flexicurity strategy to promote more and
better jobs by combining flexibility for the
companies and security for the workers. MS
should encourage employment security rather
than job security. Emphasis should be led on incompany training, lifelong learning programmes
and promoting entrepreneurship. Often the
Danish example of loose dismissal protection,
high unemployment benefits and active labour
market policies are advertised.
- Strategies to achieve a better balance of work,
private and family life.
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- Highlighting the benefits of diversity and
combatting gender and racial discrimination and
inequality as well as fostering rights of disabled
persons.
- Raising the employment rate
- Promoting more investment in education,
training, research and development.
- Promoting “green” sustainable investments
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Recently also the European social partners have
done their bit in increasing this entire paper
mountain on employment policies by concluding
in 2010 the Framework Agreement on inclusive
labour markets.
It is drawing the attention of all concerned to the
necessity to integrate especially those persons
who suffer most difficulties in access to the labour
market or lost their jobs.
However, also this agreement is just one lofty
admonition, especially of the national social
partners, to consider their responsibilities in this
field, without containing any binding obligation.