Two discussion are going on concerning free movement of people (workers) in the EU: on social support and other allowances to workers and their families (and workers who become jobless) who moved to work from a "poorer" or "lower wage" or "lower cost" country and about the so-called "posted workers", who keep their employment status in their original country but their company moves them to work in another one - also exploiting the difference between wage and price levels. That this is good for consumers by decreasing prices, no one can deny. The plans for reform, howver, are not coherent in these two domains.
While if they have to pay - family
and education allowances - governments want to pay less to workers in their
countries who have their families in cheaper countries, when others have
to pay, i.e. foreign enterprises, they ignore that posted workers do not give
up their roots, flats, contacts in their mother countries, they are temporarily
in their country of posting. Therefore the slogan "equal pay for equal
work", if taken by purchasing power, does not hold.
Who would benefit from the proposed
modification? Not the posted workers, they would lose their jobs. The local
enterprises would have more demand for their work, this could raise prices.
This price increase would not benefit the local workers, if the argument that
posted workers harm local industry, holds, as then there would be just a return
to normal employment. They would, however, suffer from higher prices as
consumers. If the EU wants more social justice, it should favour consumers, not
the companies employing them. In particular not one group of companies over
another by limiting competition.
Finally, what about the single
market? The Services Directive was watered down by the same interests which are
at work to amend the posted workers directive, therefore there is no free
market in services to protect. Obstacles are in the Directive and in
implementation (e.g. administrative difficulties to have qualifications
recognised in the “regulated professions”). Therefore I would suggest to
Eastern-European governments that when they accept the amendment, they should
only do it only for sectors where services are completely liberalised. It would
of course help if the Commission would already take these considerations on
board when making its proposal.
While writing this, I found the article from Bruegel, a renowned think tank, titled "EU posted workers: separating fact and fiction". It explains that in
2015, there were around 2 million work postings in the EU, which is 0.65%
of the labour force and 0.9% of total employed people in the EU.
This is not an immense threat to employment in the receiving countries but more important for the sending countries (according to the same article, their share
in Polish domestic employment is 2.5% but it has to be mentioned that Poland sends out most - almost a quarter of total - posted workers). This share also seems small, but losing their job may be a tragedy for the posted workers themselves and a lethal blow to the companies as well. Thus, to increase employment by fraction of a percent (from the arguments above it follows also that due to the decrease of demand caused by the increase in prices not all posted jobs will be filled with locals, i.e. the "positive" impact will be smaller), lives and companies will be ruined. This does not look like solidarity, which is one of the main values of Europe.
