Brussels, 02/05/2014 (Agence Europe) - The Single Market Observatory (SMO) of the European Economic and Social Committee (EESC) presented the plenary session of the EESC, on Tuesday 29 and Wednesday 30 April, with its report on the effects of the services directive on the construction sector. This report contains various recommendations, such as the creation of minimum European standards for inspection services, a European register of tax and social policy concepts and European social security number.
According to the report, the European legislative framework on the freedom to provide services in the construction sector, which is made up of the directive on services in the internal market (2006/123/EC) and the directive on worker secondment (1996/71/EC, which has just been revised), is adequate overall, but it is not sufficiently applied. Various problems result from this situation, such as false self-employment and the existence of fraudulent businesses moving from one member state to the next to avoid the authorities.
The report takes the form of a table, in which the SMO has sought to make a recommendation for each problem identified. From the point of view of administration, the main issue is the principle of the declaration of service provided. 45% of foreign workers are undeclared, whilst at the same time, the A1 form is frequently falsified. It must therefore be ensured that all member states have a computerised prior declaration system. In an ideal world, the declarations would be added to with electronic cards.
As regards the practical aspects, the report flags up various problems, relating to such things as the ability of SMEs to take out insurance to operate in another member state and payment delays, from both public and private clients. The report also notes that online public services are either non-existent or hard to access, or ineffective, as is the case for the national and European internet sites and the “one-stop shop”. As for cooperation between public administrations, this is inadequate and the IMI and SOLVIT networks are under-used. In all cases, multilingualism is conspicuous by its absence.
The political debates - and rows - caused by the revision of the directive on worker secondment have barely ended, with a positive vote of the European Parliament (see EUROPE 11062). The problems identified by the report regarding the functioning of the employment market are therefore logically related to this dossier. The SMO points out several issues which the implementing directive may not tackle fully and which can be summed up with the notion of “social dumping”. The problem is such that the report suggests the creation of a “European social Interpol”.
In order to deal with abusive practices, member states should apply the law more strictly, with deterrent fines, and should not hesitate to exclude fraudulent companies from the market. A raft of common European criteria to determine the nature of the employment should be set up at the same time. New services within the single market could also be set in place to reinforce this aim. This could be implemented through a European work inspection mechanism, which would support the fight against cross-border fraud.
Lastly, the report flags up several aspects of the “services” directive which have not been implemented and which have led to a fragmented interpretation of the directive, the continuation of discriminatory practices and insurance cover which is unsuitable for cross-border service provision. As regards services in the internal market, these are suffering from the absence of an integrated market, disparate national regulations and the existence of unjustified barriers between the member states. (JK)