The impact of the European Employment Strategy on national labour law

Author:Silviana Sciarra
Profession:Professor of Labour Law
Pages:15-19
SUMMARY

1. From Maastricht to Amsterdam and Lisbon. 2. Changes within national administrations under the OMC. 3. How to preserve a language of rights in the OMC.

 
INDEX
CONTENT

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The indication emerging from this study is that labour law has to re-establish a language of rights, and make sure that soft law techniques do not indirectly undermine a structure of guarantees which can be adaptable, without losing its internal coherence.

Co-ordination of employment policies brings about diversity of national responses rather than uniformity.The overall impression is that the Open Method of Coordination (OMC) in employment policy, as well as social inclusion, tends to highlight the fundamental needs of individuals. It does so by adopting a non-prescriptive terminology and designating wide areas in which active measures - not necessarily legislation -are considered necessary. In doing so, it generates responses from Member States which can be equally vague and detached from coherent labour market reforms.

In a climate characterised by continuous exchange of information, the only visible danger is that the open process of mutual learning, one of the greatest achievements of this method, might upset the balance between hard and soft law measures. Employment policies, while enhancing important innovations, underline a challenge for labour law: measures in this field must prove to be 'efficient', without losing track of their primary function.

Results achieved under the OMC in social inclusion policies are not indifferent to the evolution of labour law.They highlight areas in which labour law could re-invent its function, attempting to satisfy the primary needs of the excluded and building a new base of rights.

What is new about the current debate is the need to develop a broad framework for the strengthening of fundamental social rights, well grounded in national constitutional traditions and in European law.

1. From Maastricht to Amsterdam and Lisbon

In the decade taken into account for this cross-country study, interpreting the evolution of labour law inevitably implies taking on board inputs which have come from the European macro-economic system.29 In the various phases preceding the adoption of the single currency, labour law reforms and policies of wage moderation have been essential ingredients of national responses to the related challenges and a way to comply with the Maastricht criteria. In some countries the choice to enter EMU coincided with deep reforms inside the administration and with an improvement in the efficiency of the state apparatus.30

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Employment policies, after the insertion of Title VIII in the Amsterdam Treaty, have been inextricably linked to broad economic policies, while aiming at the furthering of a high level of employment. One of the innovations of the Lisbon Council was, in fact, to bring forward the coordination of existing processes.31 Subsequently the Commission has pointed to a further 'synchronisation'32 of employment and economic policies, emphasising that these two facets of European integration must proceed on parallel tracks.

The urgency to practice comparative labour law comes into view while observing the evolution of the OMC in employment policy. Coordination in this field brings about diverse national responses, rather than uniformity. Although this result could be acknowledged as the greatest success of comparative law - namely respecting national peculiarities, avoiding transposing elsewhere national institutions and national law - it also reveals some weak sides.

The different national reactions in complying with the Council's guidelines are the strength and the originality of OMC. However, the comparability of final outcomes is still under discussion and should be developed into clear techniques, in order to further improve that method.This has to do with the need for concrete results.33

The Lisbon agenda has put forward three main objectives: full employment, quality and productivity at work, and social cohesion and inclusion. Member States are required to pursue such objectives in a balanced manner, involving all relevant actors. The 2003 Employment Guidelines,34 for example, may help us to visualise the framework within which national labour law is asked to operate.

Under the heading 'specific guidelines' we find very broad and at times not very specific definitions of measures. Active and preventive measures for the unemployed and inactive must 'ensure that, at an early stage of their unemployment spell, all jobseekers benefit from an early identification of their needs and from services, such as advice and guidance, job search assistance and personalised action plans'.35

This measure generates expectations in each individual falling under the described category of jobseekers. Each individual becomes the potential addressee of measures which enable the state to reach a target, as indicated in the guidelines (25% of the long-term unemployed should be involved in an active measure by 2010).The individualised assistance that jobseekers should receive has to do with the fact that they are identifiable as members of specific collective entities, such as, for example, the long-term unemployed or other categories of workers not integrated in the labour market.

If we look at the ways in which the regulation of non-standard contracts of employment has developed in recent years in most Member States, we can see that individual freedoms may very often be compressed. Part-time contracts are, in a number of cases, apparently only freely entered into; while the same can be said for some forms of agency work.

The overall impression is that the OMC in employment policy, as well as in social inclusion policy, tends to highlight fundamental needs of the individuals. It does so by adopting a non-prescriptive terminology and designating wide areas in which active measures - not necessarily legislation -are considered necessary. In doing so, it generates responses from Member States which can be equally vague and detached from coherent labour market reforms.

The indication emerging from this study is that labour law has to re-establish a language of rights, and make sure that soft law techniques do not indirectly undermine a structure of guarantees which can be adaptable, without losing their internal coherence.

What is new about the current debate is the need to develop a broad framework for the strengthening of fundamental social rights,well grounded in national constitutional traditions and in European law. Fundamental rights prove to be part of the evo-Page 17lution of labour law. They function as limits to individual contractual freedom and as a driving force for legislation.

The results emerging from this comparative analysis on the evolution of labour law can in perspective be linked to the ongoing discussion on the Draft Treaty establishing a Constitution for Europe and in particular to the interpretation of the terminology adopted in the Charter inserted in Part II at Articles II-51 and II-52, where the words 'rights and principles' are used.

This reflection is needed in order to improve the coherence of the OMC and to give legal grounding to positive integration. Employment policies, while enhancing important innovations, underline a challenge for labour law: measures in this field must prove to be 'efficient', without losing track of their primary function

This issue was addressed with great emphasis in comparative research. Flexibility should not only serve the purpose 'to optimise the market relationship', but also be functional to 'numerous production relations', thus enhancing intervention in areas such as security, both for workers and companies.36 This perspective of change should be accompanied by specific measures guaranteeing individual security, when uncertainty becomes a dominant feature in contracts of employment.

One of the areas in which labour law should play this role, bringing about security as a guiding principle and enhancing new forms of participation, is economically dependent work.37

2. Changes within national administrations under the OMC

Some important innovations are reported as a consequence of the soft law regime created by the OMC.They signal the need to adapt national administrations to new mechanisms of compliance and set up new specialised bodies within the most relevant branches of government. These innovations are significant and yet difficult to compare. No overall, coherent theory of change emerges, although it seems clear that a more efficient co-ordination of national ministerial experts can enhance further co-ordination of employment policies and introduce mechanisms to evaluate national performances.

First of all, as indicated in the report on Greece, the European Employment Strategy (EES) brings about 'horizontal issues' such as quality of work, active ageing, vocational training and lifelong learning. It thus forces national legal orders to accept and incorporate new concepts. In some countries this may influence considerably the drafting of legislation and the setting of priorities. In other countries changes may appear less traumatic and prepare ways to adapt slowly to the open coordination.

In Greece, the reform of the placement system was introduced through the National Action Plan (NAP) for 2000, and then expanded to professional training. The NAP 2002 indicates that 1795 jobs were created through private employment agencies. The Greek government's commitment to a correct drafting of NAPs led it to establish two new bodies.The 'National Committees on social dialogue for Employment and for Social Protection' are permanent vehicles for the elaboration of national strategies in both areas, encouraging the participation of all interested actors and relevant ministries.The task of the National Committee on Dialogue for Employment is to promote social dialogue in proposing employment policies, as well as in monitoring and evaluating the NAP Employment.A special new body, the 'Council of experts on employment and social security', was created. NAPs are considered to have been a vehicle for the reform of the hiring system and of private employment agencies in Greece.

In France, the EES forced the government and the social partners to open a debate on new issues and led to the creation of a permanent forum for discussing employment policies called CSDEI (Comité du dialogue social pour les questions européennes et internationales). A visible sign is the 2003 reform of the pension system, relevant for ageingPage 18 workers, whereas the 2003 agreement on lifelong training is considered part of a national debate and not influenced by European policies. NAPs too are perceived as internal to the administration and not sufficiently open to the social partners.38

In Italy, the report on the impact of employment policies requested by the Commission and prepared by a research institution constitutes a valuable and new source of information. 39 It offers a critical evaluation of the EES, mainly due to the fact that NAPs leave little space for local development schemes and accentuate the split between dual labour markets40. NAPs also fail, according to the report, to include the social partners. Furthermore, if we consider that Italy does not have a tradition in monitoring policies, it seems that the OMC has had a positive impact and that the creation of specialised bodies inside the administration should be encouraged41.

3. How to preserve a language of rights in the OMC

Some preliminary conclusions can be drawn from observation of the OMC with regard to the evolution of labour law. The emphasis that this study puts on national developments is an attempt to indicate that there is a legal language to be preserved; it must be articulated within a normative perspective, broader than that of employment policies.

In a climate characterised by continuous exchanges of information, the only visible danger is that the open process of mutual learning, one of the greatest achievements of the OMC, might upset the balance between hard and soft law measures. It was in fact the case that, while the success of the OMC in employment policies was being celebrated, the directives that saw the light were mainly based on framework agreements between the European social partners, thus signalling a significant 'shift' from one policy agenda to the other.42Those more closely related to a potential reduction of unemployment and to a proclaimed creation of new employment -namely the Fixed-term Work43 and the Part-time Work44 Directives - have as their central focus the principle of equal treatment among all workers, irrespective of their contract of employment. In both cases, convergence means requiring Member States to comply with this fundamental principle. Ways to specify such compliance are not always prescriptive and leave significant space for differentiation, rather than for harmonisation.

A parallel fear to the one generated by a possible imbalance between hard and soft law is that legal analysis aimed at facilitating the convergence of labour standards could be overcome - if not made redundant - by the evaluation of statistics on social indicators.

In extending OMC to social inclusion,45 objectives have been expanded. A specialised sub-group within the Social Protection Committee -established by the Council46 according to Article 144 TEC, introduced by the Treaty of Nice -Page 19 proposed to include in social indicators issues such as financial poverty, income inequality, regional variation in employment rates, long term unemployment, joblessness, low educational qualifications, low life expectancy and poor health.47

Objectives of such a significant relevance are the result of a common initiative of Member States and yet they may create very different reactions at national level, raising, at times, the problem of co-ordination with decentralised levels of state administration. The 1997 UK constitutional reform on the devolution of powers to Scotland,Wales and Northern Ireland left the central government with a competence for overall fiscal policy. The drafting of NAPs on social inclusion was an occasion to re-connect different levels of governance.48

This policy agenda is very close to labour law research, although a very special non-legal expertise is required for the construction and the operation of social indicators.49Results achieved under the OMC in social inclusion policies are not indifferent to the evolution of labour law.They signal the existence of areas in which labour law could re-invent its function, attempting to satisfy the primary needs of the excluded and building for them a new floor of rights.50

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[29] F. Snyder,'EMU Revisited:Are we Making a Constitution? What Constitution are we Making?' Working paper 1998/06, IUE, Florence; C. Crouch (ed), After the Euro: Shaping Institutions for Governance in the Wake of European Monetary Union, 2000, OUP, Oxford and New York.

[30] For Italy see M. Ferrera and E. Gualmini, Rescued by Europe? Social and Labour Market Reforms in Italy from Maastricht to Berlusconi, 2004,Amsterdam University Press, Amsterdam. On the role of bureaucratic elites in Italy see also, by the same authors, the Report prepared for ISFOL, La strategia europea sull'occupazione e la governance domestica del mercato del lavoro: verso nuovi assetti organizzativi e decisionali, 2002, ISFOL, Roma. In Greece, trade unions supported the accession to EMU, adopting moderation in wage policies bargained in national collective agreements. See Report on Greece.

[31] Presidency Conclusions, Lisbon European Council, 23-24 March 2000.

[32] Communication from the Commission to the Council, the EP, the ESC and the Committee of the Regions, Taking Stock of Five Years of the European Employment Strategy, COM(2002) 416 final, Brussels 17.7.2002. 'Synchronisation' is part of the simplification of employment guidelines pursued by the Commission.

[33] This is one of the outcomes highlighted in Jobs, Jobs, Jobs. Creating more employment in Europe, Report to the European Commission of the Employment taskforce chaired by W. Kok, November 2003, Office for Official Publications of the European Communities, Luxembourg.

[34] Council Decision of 22 July 2003 on guidelines for the employment policies of the Member States (2003/578/EC), O.J. L 197/13.

[35] Section 1 (a).

[36] European Commission, Transformation of Labour and Future of Labour Law in Europe, (Supiot Report), 1998, available at: http://europa.eu.int/comm/employment_social/labour_law/docs/supiotreport_en.pdf, p. 155.

[37] See further Chapter V, section 2.

[38] In a report issued by the Ministry for employment, Les politiques de l'emploi et du marche du travail, published in 2003, a specific commitment is made towards the enforcement of employment guidelines through appropriate legislation.

[39] C. Dell'Aringa (ed.), Impact evaluation of the European employment strategy, May 2002, ISFOL. 40

[40] A 'Master Plan' was prepared by the Ministry in 2000, to be circulated among decentralised local administrations, in order to react against the Commission's negative evaluation of the Italian reform of the hiring system.The whole process of monitoring such a complex exchange of information saw an incredibly high turnover of experts which, according to M. Ferrera, E. Gualmini, La strategia europea sull'occupazione e la governance domestica del mercato del lavoro: verso nuovi assetti organizzativi e decisionali, 2002, ISFOL, Roma, was a sign of how unprepared the administration was to respond to OMC.

[41] However, monitoring is an exercise which does not include a specific legal command. It is often the case that OMC brings about the adoption of a jargon, not always compatible with the legal style to be used in drafting legislation. See, for example, Art. 17 of the Italian 2003/276 Decree on monitoring of employment policies. In this very long article it is difficult to distinguish measures of an administrative nature, from the indication of well-defined legal responsibilities.

[42] As suggested by D.Ashiagbor,'EMU and the Shift in the European Labour Law Agenda: from 'Social Policy' to 'Employment Policy'', (2001) 7 European Law Journal 311, at p. 329.

[43] Council Directive 99/70/EC of 28 June 1999.

[44] Council Directive 97/81/EC of 15 December 1997.

[45] Presidency Conclusions, Lisbon European Council, 23-24 March 2000, para 32. 46

[46] Council Decision 2000/436/EC, O.J. L 172, 12.7.2000, p. 26.

[47] As reported by T.Atkinson,'Social Inclusion and the European Union' (2002), Journal of Common Market Studies, pp. 625 ff.

[48] I thank K.Armstrong for this information, on the occasion of a presentation of his work in progress on social inclusion during a workshop held at the University of Brescia.

[49] S. Sciarra,'The 'making' of EU labour law and the 'future' of labour lawyers', in: S. Deakin, C. Barnard and D. S. Morris (eds.), The future of labour law, Liber Amicorum Sir Bob Hepple QC, Hart Publishing, forthcoming.

[50] B. Hepple talks of an 'integrative' function of labour law, with regard to social inclusion policies. See 'The future of labour law', (1995) Industrial Law Journal, p. 320. See also H. Collins,'Discrimination, Equality and Social Inclusion' (2003), Modern Law Review, pp. 16 ff.This point is also considered in Chapter X, section 2.