As part of the negotiations on the Regulation on the coordination of social security systems (883/2004), France submitted a working hypothesis, earlier in the week, to the other Member States on the introduction of a specific mechanism to smooth the differentials between Member States in terms of social contributions when a worker is posted, according to our information obtained between Wednesday 9 and Friday 11 October.
The French proposal would cover the chapter on applicable legislation. It would aim to accelerate the upward convergence of social security systems by using posted workers as a lever.
In essence, the mechanism suggested by France would consist of making the employer pay the difference in contributions between the host Member State and the home Member State to the posted worker's home social security system.
This proposal would thus have a double advantage. First, this mechanism would significantly reduce the issue of social dumping, since at present the principle of “equal pay for equal work in the same workplace” prevails, without taking into account the issue of social security contributions. Secondly, this solution would be financially beneficial for the social security system of the home Member States.
It is difficult to say whether the arguments put forward by France would be able to convince the countries of Central and Eastern Europe (more precisely the Czech Republic, Poland and Hungary). These countries had rejected or abstained from the interinstitutional agreement reached between the Romanian Presidency of the Council of the EU and the European Parliament last March, in particular because of the content on the chapter on applicable legislation (see EUROPE 12225/15).
For these Member States, the French proposal would – basically – have the consequence of considerably reducing the financial interest for Western European employers to use workers posted from Central and Eastern Europe, while having very little impact on the posting of workers from Western Europe to Central and Eastern Europe.
Strange echo. This proposal strangely echoes an intervention at the hearing of the Commissioner-designate for Employment, Nicolas Schmit, on Tuesday 1 October. MEP Sylvie Brunet (Renew Europe, France) had asked the Commissioner-designate precisely about the social dumping caused by differences in social contributions between Member States while posted. Mr Schmit then replied that the question was “complex” and seemed to question the existence of competitive conditions that would be “unacceptable” because of the different contribution systems (see EUROPE 12339/3).
Interinstitutional negotiations. Interinstitutional negotiations between the European Parliament and the EU Council were scheduled to resume on Tuesday 8 October. But the Parliament Conference of Presidents (CoP) has postponed its decision to give the green light, which should arrive on Thursday 17 October (see EUROPE 12334/20).
This delay should not be a problem for the EU Council. Several Member States, including Austria, the Czech Republic and Germany, have indicated that they would like to take their time in the negotiations, in order to favour the quality of the agreement over the speed of the negotiations.
The core of the negotiations should be the chapter on applicable legislation. But the chapter on social benefits linked to unemployment could also be a challenge, according to our information. The “Like-minded” (Germany, the Netherlands, Luxembourg, Austria, Denmark and Belgium) would like to review the duration of the export of social benefits and the aggregation of rights in the unemployment chapter. (Original version in French by Pascal Hansens)