COMMISSION STAFF WORKING DOCUMENT IMPACT ASSESSMENT Accompanying the document Proposal for a Regulation of the European Parliament and of the Council establishing a European Labour Authority

EN EN
EUROPEAN
COMMISSION
Strasbourg, 13.3.2018
SWD(2018) 68 final
COMMISSION STAFF WORKING DOCUMENT
IMPACT ASSESSMENT
Accompanying the document
Proposal for a Regulation of the European Parliament and of the Council
establishing a European Labour Authority
{COM(2018) 131 final} - {SWD(2018) 69 final}
Europaudvalget 2018
KOM (2018) 0131
Offentligt
1
Contents
1. INTRODUCTION: POLITICAL AND LEGAL CONTEXT............................................................... 5
2. PROBLEM DEFINITION .................................................................................................................... 7
2.1 What are the problems?.....................................................................................7
2.2 What are the problem drivers? ..........................................................................9
2.3 How will the problem evolve? ........................................................................20
2.4 Scope of a European Labour Authority...........................................................22
3. WHY SHOULD THE EU ACT? ....................................................................................................... 23
3.1 Legal basis.......................................................................................................23
3.2 Subsidiarity......................................................................................................23
3.3 Proportionality.....................................................................................................24
4. OBJECTIVES: WHAT IS TO BE ACHIEVED? ............................................................................... 24
4.1 General objective.............................................................................................24
4.2 Specific objectives...........................................................................................24
5. WHAT ARE THE AVAILABLE POLICY OPTIONS? .................................................................... 25
6. POLICY OPTIONS AND THEIR IMPACTS.................................................................................... 25
6.1. Baseline scenario.............................................................................................28
6.2 Policy Option 1 (Support option) ....................................................................28
6.3 Policy Option 2 (Operational option)..............................................................29
6.4 Policy Option 3 (Supervisory option)..............................................................29
6.5. Impacts of the different policy options in relation to tasks .............................31
6.6. Comparison of the different Policy Options....................................................42
7. DELIVERY OPTIONS AND THEIR IMPACTS .............................................................................. 44
7.1 Delivery options ..............................................................................................45
7.2 Impacts of different delivery options ..............................................................49
7.4. Comparison of Delivery Options.....................................................................56
8. PREFERRED POLICY AND DELIVERY OPTION......................................................................... 58
8.1 Policy Option 2 (Operational Option), and Delivery Option 2 (New
European Labour Authority building on existing EU bodies).........................58
8.2 REFIT (simplification and improved efficiency)............................................61
9. HOW WILL ACTUAL IMPACTS BE MONITORED AND EVALUATED?.................................. 63
9.1. Monitoring.......................................................................................................63
9.2. Evaluation........................................................................................................66
ANNEX 1: PROCEDURAL INFORMATION............................................................................................ 68
ANNEX 2: STAKEHOLDER CONSULTATION....................................................................................... 71
ANNEX 3: WHO IS AFFECTED AND HOW? .......................................................................................... 86
ANNEX 4: ANALYTICAL METHODS ..................................................................................................... 89
ANNEX 5: ELA PROBLEM TREE............................................................................................................. 95
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ANNEX 6: EU ACQUIS RELEVANT FOR THE INITIATIVE................................................................. 96
ANNEX 7: EU LEVEL COMMITTEES AND STRUCTURES IN THE FIELD OF LABOUR
MOBILITY....................................................................................................................................... 102
ANNEX 8: PRACTICAL TOOLS FOR THE SHARING OF ADMINISTRATIVE
DOCUMENTS AND INFORMATION BETWEEN NATIONAL AUTHORITIES IN THE
FIELD OF LABOUR MOBILITY ................................................................................................... 104
ANNEX 9: INFORMATION TOOLS AND PROBLEM-SOLVING SERVICES FOR CITIZENS
AND BUSINESSES IN THE FIELD OF LABOUR MOBILITY.................................................... 106
ANNEX 10: OVERVIEW OF POLICY AND DELIVERY OPTIONS .................................................... 109
ANNEX 11: LEGAL CHANGES TO IMPLEMENT THE OPTIONS ..................................................... 113
ANNEX 12: ANALYTICAL SUPPLEMENT........................................................................................... 117
ANNEX 13: EU DECENTRALISED AGENCIES IN THE AREA OF EMPLOYMENT ....................... 154
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Glossary
Term or acronym Meaning or definition
AC Administrative Commission for the Coordination of Social Security
Systems
BusinessEurope European Employers Organisation
Cedefop European Centre for the Development of Vocational Training
EaSI European Programme for Employment and Social Innovation
ECJ European Court of Justice
ECPW Expert Committee on the Posting of Workers
ECR Euro Control Route
EESSI Electronic Exchange of Social Security Information
EFBWW European Federation of Building and Woodworkers
EGF European Globalisation adjustment Fund
ELA European Labour Authority
ERRU European Register of Road transport Undertakings
EMCO Employment Committee
EMU European Monetary Union
EPSCO Employment and Social Affairs Council
ESDE Employment and Social Developments in Europe
ESSN European Social Security Number
ETF European Training Foundation
ETUC European Trade Union Confederation
EU-OSHA European Agency for Safety and Health at Work
EURES European network of employment services
Eurofound European Foundation for the Improvement of Living and Working
Conditions
FMW Free Movement of Workers
FTE Full time equivalent
ILO International Labour Organisation
IMI Internal Market Information system
INASTI L'Institut national d'assurances sociales pour travailleurs
indépendants
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JIT Joint Investigation Teams
MISSOC Mutual Information System on Social Protection
ONSS Office National de Sécurité Sociale
OPC Open public consultation
PES Public employment services
QFR Quality Framework for Restructuring
SDG Single digital gateway
SME Small and medium enterprise
UDW Platform European Platform tackling undeclared work
UEAPME European Association of Craft, Small and Medium-sized
Enterprises
YEA Your Europe Advice
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1. INTRODUCTION: POLITICAL AND LEGAL CONTEXT
Strengthening fairness of the Internal Market has been one of the priorities of the mandate of
the Juncker Commission1
. On 17 November 2017, the European Parliament, the Council and
the Commission jointly proclaimed at the Social Summit in Gothenburg the European Pillar
of Social Rights2
. The Pillar sets out a number of key principles and rights to support fair and
well-functioning labour markets and welfare systems. It is designed as a compass for a
renewed process of convergence towards better working and living conditions across the
Union, ensuring the citizens equal opportunities and access to the labour market, fair working
conditions and social protection and inclusion. Ensuring fair labour mobility in Europe is
central to this objective.
Intra-EU labour mobility benefits individuals, economies and societies as a whole. However,
concerns have recently increased over the adequacy of existing rules to uphold fair
competition and social standards in the context of stark economic and social differentials. The
objective of deepening the Internal Market with a strong accent on social fairness has thus
driven forward new EU legislative proposals to support cross-border mobility. These are the
revisions of the Posting of Workers Directive3
and of the Regulations on the Coordination of
Social Security systems4
. These proposals come on top of previous EU legislation to facilitate
the free movement of workers and job-seekers5
and initiatives such as the set-up of a
European Platform to tackle undeclared work6
.
Labour mobility has implications for all economic sectors. Yet, enforcing EU labour rules
across borders proves particularly difficult in the road transport sector due to the highly
mobile nature of operations7
. This can affect negatively the protection of drivers, while also
represent a source of unfair competition between companies. Therefore, the Commission
adopted the package "Europe on the Move", including the lex specialis on the posting of
workers in international road transport operations8
which will strengthen social rules in this
sector.
While the EU legal framework pertaining to EU-level labour mobility keeps evolving to
ensure the effectiveness and completeness of the existing acquis, rule enforcement and
information challenges remain. On several occasions, the European Parliament has underlined
the need to ensure proper implementation of EU legislation on cross-border labour mobility,
1
A New Start for Europe: My Agenda for Jobs, Growth, Fairness and Democratic Change, 10 Commission priorities for
2015-19, (https://ec.europa.eu/commission/priorities_en).
2
An overview of the European Pillar of Social Rights is available here: https://ec.europa.eu/commission/priorities/deeper-
and-fairer-economic-and-monetary-union/european-pillar-social-rights_en.
3
COM(2016) 128 final
4
COM(2016) 815 final.
5
Directive 2014/54/EU on measures facilitating the exercise of rights conferred on workers in the context of freedom of
movement for workers; Regulation (EU) 2016/589 on a European network of employment services (EURES), workers'
access to mobility services and the further integration of labour markets.
6
Decision (EU) 2016/344 on establishing a European Platform to enhance cooperation in tackling undeclared work.
7
European Parliament Policy Department,, Social and working conditions of road transport hauliers (April 2013)
8
COM/2017/0278 final
6
asking to reinforce controls and coordination between and by Member States so as to promote
standardisation and cooperation9
, including through strengthening information exchanges
between labour inspectorates10
. Moreover, the European Parliament has made a concrete call
to coordinate and reinforce cooperation on road transport legislation, including through a
possible agency setting11
. The Council has also stressed the need to improve administrative
cooperation and develop assistance and information exchanges in the context of fighting fraud
related to the posting of workers, while emphasising the importance of clear and transparent
information for service providers and workers12
.
Against this backdrop, in his State of the Union address 201713
, President Juncker proposed
the establishment of a European Labour Authority (ELA) to ensure that EU rules on labour
mobility are enforced in a fair, simple and effective way. This initiative is adopted by the
Commission as part of the Social Fairness Package, together with a proposal on Access to
Social Protection. It was informed by the results of an open public consultation (OPC) held
between November 2017 and January 2018, as well as by various targeted consultations with
stakeholders (see Annex 2). The Social Fairness Package will help to deliver on the principles
and rights defined in the European Pillar of Social Rights, notably by ensuring that workers'
and citizens' rights to equal treatment and opportunities regarding employment and social
protection are guaranteed in cross-border situations.
As announced, the Authority will be competent to facilitate the implementation of the (i) EU
labour mobility rules, which cover the areas of free movement of workers, posting and
undeclared work, and this for all economic sectors including road transport. But as mobile
workers enjoy both labour and social security rights, the Authority will also be competent for
the implementation of (ii) EU social security coordination rules, the two issues being
intrinsically connected. Therefore, the initiative will target all categories of persons who are
subject to the two aforementioned sets of EU rules - workers, self-employed or simply
individuals who are Union citizens or third country nationals legally resident in the Union, as
long as they are subject to EU labour mobility and social security coordination rules.
This initiative has a self-standing character due to its thematic specialisation and focus on
cross-border labour mobility. The proposal has been developed in parallel to an ongoing
evaluation of existing decentralised Agencies in the employment field. This Impact
Assessment discusses the potential interaction between the present initiative and existing
Agencies.
9
European Parliament resolution of 14 September 2016 on social dumping in the European Union (2015/2255(INI).
10
European Parliament resolution of 14 January 2014 on effective labour inspections as a strategy to improve working
conditions in Europe (2013/2112(INI))
11
European Parliament resolution of 14 September 2016 on social dumping in the European Union (2015/2255(INI).
12
European Council, General approach on the proposal for a Directive amending Directive 96/71/EC concerning the posting
of workers, 13612/17, 24 October 2017.
13
https://ec.europa.eu/commission/state-union-2017_en.
7
2. PROBLEM DEFINITION
Free movement of workers and services is a pillar of the European Union. Mobility enjoys
wide support amongst EU citizens14
and provides the opportunity for workers and companies
to seek work and to provide services across the whole of the EU.
Around 17 million EU citizens live and/or work in another Member State, of which 11.8
million are mobile workers of working age (i.e. EU-28 citizens who reside in a Member State
other than their country of citizenship). Moreover, 1.4 million live in a Member State but
work in another (so-called 'cross-border workers') and a further 2.3 million are posted
workers, carrying out services in another Member States on a temporary basis (see Annex 12,
Table 1). Finally, over 2 million workers in the road transport sector cross intra-EU borders
on a daily basis transporting goods or passengers.
However, labour mobility remains an untapped resource in Europe15
. While the number of
mobile workers has almost doubled compared to a decade ago16
, they make up around 4% of
the total EU workforce, a lower share than in the United States.17
Similarly, the potential for
cross-border operations of companies is not yet fully exploited, most notably in some sectors
such as construction and business services.18
This untapped potential has strong socio-
economic impacts on the job-search or career opportunities of citizens, on the efficient
allocation of resources (skills and capital) in the EU labour and Internal Market, as well as on
the shock-adjustment capacities within the Eurozone.
2.1 What are the problems?
The EU has developed an extensive body of legislation regulating the free movement of
workers and setting rules on the coordination of social security regimes. Annex 6 provides an
overview of legislation in this field. In addition, a number of committees and networks have
been set up to support the implementation and enforcement of those rules (see Annex 7).
Against the backdrop of this formal legislative and institutional framework, however, two
major challenges undermine effective cross-border labour mobility and compliance with EU
rules.
14
A large majority of Europeans in all 28 EU Member States continue to support “the free movement of EU citizens who
can live, work, study and do business anywhere in the EU” (81% in 2017), Standard Eurobarometer 88, Autumn 2017.
15
Barslund, M., Busse, M. and Schwarzwälder, J. (2015), Labour Mobility in Europe: An untapped resource? CEPS Policy
Briefs, No. 327, March 2015; Bertelsmann Stiftung (2015), Harnessing Labour Mobility. Scenario analysis and policy
recommendations.
16
According to Eurostat data, in 2006 there were about 9 million EU citizens residing in a Member State other than their
country of citizenship, whereas in 2017 these are 17 million.
17
European Commission, 2016 Annual Report on intra-EU Labour Mobility, p. 43-5; OECD (2016), OECD Economic
Surveys: European Union 2016, OECD Publishing, Paris; Bruegel (2018), People on the Move: Migration and Mobility
in the European Union, Blueprint Series 28.
18
See: Impact Assessment Accompanying the document Proposal for a Regulation of the European Parliament and of the
Council introducing a European services e-card and related administrative facilities SWD(2016) 439 final.
8
1) Inadequate information, support and guidance function for individuals and
employers in cross-border situations
Awareness of rights, obligations and procedures deriving from EU mobility legislation is a
crucial element in informing the decisions of citizens and companies to seek a job, work or
operate in another Member State. Having access to relevant information – for instance, about
applicable wage levels or administrative requirements when posting workers, the eligibility
conditions of social security benefits in another country, national contact points able to
provide assistance – is ultimately about the effective exercise of EU rights to free movement.
In order to provide such information, the EU has produced a number of web-based portals and
tools, which are summarised in Annex 9.
While the European Commission has taken steps to improve guidance19
and recently proposed
initiatives to streamline access to these existing online tools and portals20
, challenges remain
in the provision of tailored information and services to citizens and businesses to support their
mobility choices. For example, in the road transport sector specifically, comprehensive
information sources to assist road transport workers and operators are virtually inexistent at
the EU or national level.
As a consequence of inadequate information, citizens may not be aware of their rights, for
example, to access unemployment benefits in another EU Member State or of the wage level
they are entitled to when being posted to another Member State.21
Likewise, companies,
especially SMEs without dedicated staff, may not be aware of the administrative requirements
or the exact wage level that they need to comply with when posting workers to another
Member State. In addition, gathering information about and carrying out administrative
procedures to establish a cross-border subsidiary or hiring employees in another Member
State is estimated to produce 80% extra costs with respect to a domestic business22
.
2) Inadequate cooperation between national authorities on rule enforcement
The capacity of national authorities to enforce EU and national rules in the field of labour
mobility is in certain cases highly dependent on their ability to cooperate with one another.
19
COM(2014)6 final, Proposal for a European network of Employment Services, workers' access to mobility services and
the further integration of labour markets, 17.1.2014.
20
COM(2017)256, Proposal for a regulation on establishing a single digital gateway to provide information, procedures,
assistance and problem solving services and amending Regulation (EU) No 1024/2012. The SDG aims to improve the
'findability' of online information and to offer easy access to information, assistance, and problem-solving services needed
by individuals and businesses when exercising their rights in the internal market. The Gateway will give access to
information on and links to seven assistance and problem-solving services for citizens and businesses, including EURES,
Points of Single Contact, Product Contact Points, Construction Product Contact Points, National Assistance Centres for
Professional Qualifications, Health Contact Points, and Online Dispute Resolution. See also Action plan on the
Reinforcement of SOLVIT (COM (2017) 255 final).
21
Some Member States report that unemployed persons may leave the Member State where they have worked without
requesting the necessary document for the export of the unemployment benefits, because of lack of awareness of their
rights (European Commission, Coordination of social security systems at a glance. 2017 Statistical Report, p. 43)
22
IA on establishing a single digital gateway to provide information, procedures, assistance and problem solving services
and amending Regulation (EU) No 1024/2012; SWD/2017/0213 final).
9
For example, a national authority may need to contact a competent social security institution
of another Member State in order to verify whether a posted worker is socially insured in that
country. Administrative cooperation includes many different aspects, including common
administrative and operational procedures, tools for data exchange, and a shared framework
for carrying out controls and inspections involving individuals or entities operating in more
than one Member State. The framework and tools for administrative cooperation in the EU are
however inadequate to effectively address the challenges at hand. Section 2.2 presents a more
detailed analysis of the drivers of this problem.
Inadequate cooperation has adverse consequences on rule enforcement, mutual trust between
administrations, as well as practical effects on EU citizens. Fraudulent practices such as
letterbox companies are not effectively contrasted with tangible fiscal costs, including unpaid
social security contributions, ranging between an estimated EUR 64-86 million EU-wide
solely in the road transport sector.23
The fight against social fraud also has significant impact
on businesses and workers affected by unfair competition. Timely communication of changes
in personal information of citizens living in different Member States is conducive to more
efficient administration of cross-border cases with benefits for citizens, in terms of receipt of
legitimate social security benefits, and for authorities, in terms of savings from avoiding cases
of unduly paid benefits.24
Smooth experiences with portability of social security rights may
boost the propensity to move abroad for professional reasons, while ‘negative’ experiences
are likely to have opposite effects.
2.2 What are the problem drivers?
The two major problems described above find their concrete origins in a set of underlying
problem drivers summarised in Annex 5 and detailed below.
2.2.1. Inadequate support and guidance for individuals and businesses in cross-border
situations, including incomplete or sparse information available to the public concerning
their rights and obligations.
The information provided on EU and national portals with a focus on mobility is incomplete
with regard to a number of aspects. Your Europe Advice (YEA) and SME feedback database
show numerous cases of request for practical information on requirements or rights in cases of
posting or cross-border work, particularly in the context of the road transport sector (see
Annex 12). While the problem may sometimes be a lack of citizens' awareness of an existing
23
SWD (2017) 194 final.
24
Effective systems of administrative communication between Member States have helped the Polish Social Insurance
Institution to recover EUR 560,000 in 2016 of unduly paid pension benefits of citizens living in Germany. Similarly,
effective anti-dumping investigations have allowed Belgium to recover about EUR 1.5 million of unpaid social security
contributions from employers circumventing the rules on posting (see Jorens, Y., Gillis, D. and De Potter, T. (2017),
Fraud and error in the field of EU social security coordination, Network Statistics FMSSFE, European Commission, .
Anna Cristina d'Addio Maria Chiara Cavalleri, "Labour mobility and portability of social rights”, CESifo Economic
Studies, Volume 61, Issue 2, 1 June 2015, Pages 346–376.
10
source of information, in other cases the quality or the extent of information provided by EU
or national sources may be missing, inadequate or outdated. In the case of EURES, making
available EU-wide information about national vacancies has still wide margins of
improvement25
. The new EURES regulation aims at addressing some shortcomings on the
transparency of information on vacancies and on minimum-standard services26
, national
implementation being a necessary yet not sufficient factor.
There is thus a need for continuous work on information provision by the national and EU
levels. For example, in the area of the posting of workers, practical information on applicable
working conditions or administrative requirements should be offered by Member States in a
single national website, the Commission having a support role.27
Continuous monitoring and
content adaptations also in line with users' feedback are essential elements in order to ensure
an uniform level of information standard, as well as a continuous update of information (e.g.
applicable wage agreements) is delivered across the Member States. On EURES, an untapped
potential remains with a) exploiting labour market information to underpin matching and
recruitment activities (involving the analysis of labour shortages and surpluses and including
perhaps the use of big data, data crawling as regards job opportunities available) b) the
strengthening of the capacities of client services to operating across borders, and c) the
provision of holistic and personalised information on working and living conditions in other
countries.
While the Commission's proposal on a Single Digital Gateway (SDG) will address issues
related to the on-line 'findability' of information and easiness of access to existing EU portals,
including EURES, content-feeding and strategic planning of websites will remain to be
effectively managed.
Stakeholders' views
Respondents to the public consultation on a European Labour Authority echoed the points
outlined above. A majority of respondents were of the view that insufficient access to
information and transparency on cross-border mobility rules is a problem both for individuals
and businesses (see Annex 2 for a more detailed analysis). Similarly, in the context of road
transport, 53% of the respondents to an OPC carried out in 2017 considered that EU guidance
on explaining relevant EU legislation in this field was not, or only partially, useful. This is
especially problematic in view of the different interpretation of EU road transport legislation.
Within the context of the targeted consultations, certain stakeholders underlined the challenge
of incomplete or scarce information concerning labour mobility conditions and opportunities.
The social partners considered improvement of information necessary, with employers
25
See European Court of Auditors, "Free Movement of Workers – the fundamental freedom ensured but better targeting of
EU funds would aid worker mobility", Special Report 6/2018.
26
Regulation 2016/589.
27
Directive 2014/67/EU, Article 5.
11
focusing notably on the posting of workers and trade unions including information on
industrial relation systems, wages and wage-setting systems28
.
2.2.2. Insufficient access to and sharing of information between national authorities
responsible for different domains of labour mobility and social security
coordination
Exchange of documents (notably in electronic form) and sharing of relevant data is essential
to the enforcement of rules in the area of cross-border mobility, including with a view to
fighting frauds and abuses. Examples illustrating the importance of information sharing are
numerous. Public authorities in one country need to exchange data with another Member State
concerning the social security rights and current residence of a worker in order to assess his or
her eligibility to local social benefits (e.g. a worker work for a period in country A and apply
for social security benefits in country B29
). Similarly, the sharing of registration details of a
company may serve the purpose of verifying the genuine establishment of a company in a
Member State and of detecting possibly irregular situations.
In practice, however, the lack of appropriate and timely data sharing is widely seen as a
barrier to fighting abuse of EU rules. This is notably the case in the fight against letterbox
companies30
, of infringements of social and market rules in the road transport sector, but also
in the exchange of relevant data on social security coordination, including for example to
detect fraudulent use of the European Health Insurance Card (EHIC). Currently, EU and
national authorities dispose of a range of tools for the sharing of administrative documents
and information (listed in Annex 8), such as the Internal Market Information (IMI) system and
European Register of Road Transport Undertakings (ERRU). These information-sharing tools
have different scope, operational functions and maintenance management, due to the
specificity of their respective policy areas and legislative basis. As they were not originally
conceived to interact with each other, the degree of inter-operability is very low.
Yet, this separation of cooperation instruments between interdependent policy areas hampers
the effectiveness of rule enforcement, particularly in the event of problematic situations.
Addressing real-life situations of fraud requires the simultaneous assessment of multiple
elements (e.g. the employment contract, the social security position of a worker, the legal and
economic status of a company, etc) whose information may be spread across different tools.
Moreover, problems in the lack of horizontally used formalised procedures for administrative
data exchange, such as in the case of social security coordination where an electronic data
28
See Section 6.4 Stakeholders views on the possible tasks of a European Labour Authority for more detail.
29
The establishment of one's pensions rights after working in different countries, for example, implies a number of
reported difficulties in the collection of additional documents or in the timely receipt of the ‘Certificate concerning
insurance history’, amongst other necessary documents. Cross-border old-age, survivors’ and invalidity pensions,
Report on Portable Documents P1, Reference year 2016.
30
European Platform Undeclared Work, Letterbox Companies. Survey Report, October 2017.
12
exchange system is currently in the process of implementation by Member States31
, can
prevent efficient controls on cross-border cases. Finally, lack of horizontal coordination
between different national authorities competent for separate, however inter-related policy
areas amplifies the limits to cooperation at EU level, for instance, between labour and road
transport inspectorates and social security institutions. In some cases, the first-step difficulty
of cooperation is the identification of the relevant counterpart in another Member State, facing
cross-country institutional variation32
.
EU-level gaps in coordination on the exchange of information have been partially filled by
bilateral or multilateral cooperation agreements, in the areas of the posting of workers or
undeclared work or international road transport operations. This aspect is discussed in section
2.2.3 (see also Annex 12).
Stakeholders' views
A majority (64%) of respondents to the public consultation were of the view that the difficulty
that national authorities faced in accessing relevant documentation from other Member States
constituted a challenge to effective cross-border cooperation. Similarly, within the context of
the targeted consultations, the challenge most frequently mentioned by the various
stakeholders in relation to cross-border cooperation related to the effectiveness of information
exchanges. The majority of Employment Committee (EMCO) members and certain members
within the Committee of Experts on Posting of Workers (ECPW) and within the Mutual
Information System on Social Protection (MISSOC), saw inefficiencies in terms of
information exchange and access to information by competent authorities as a major cause of
social security fraud and abuse and a major challenges to overcome at EU level.
2.2.3 Insufficient capacity of competent national authorities to organise cooperation
with authorities across borders
The staffing and organisation of national enforcement authorities, such as labour
inspectorates, social security institutions or public employment services, are clearly a national
competence and different national traditions account for the diversity in the organisation and
competences of national authorities. However, effective and efficient handling of cross-border
issues requires a good operational capacity to cooperate between competent authorities in
different Member States. Faced with an increasing demand to respond quickly to challenges
and requests from other countries, Member States' national administrative capacities are not
always adequate. This is notably demonstrated in cases of cross-border administrative
exchanges, possibly including requests for further controls and inspections. Yet, it can also be
the case in situations of labour market disruptions, such as restructuring of companies,
31
Jorens, Y., Gillis, D. and De Potter, T. (2017), Fraud and error in the field of EU social security coordination, Network
Statistics FMSSFE, European Commission, p. 53.
32
Ibidem, p. 68.
13
affecting several Member States. While national authorities and stakeholders may have partial
awareness of available EU guidance, legal and financial instruments when dealing with
restructuring33
, cooperation with relevant stakeholders in other affected Member States or at
EU level may be unsystematic.
First, there are marked cross-country differences in staff and resources on competent
authorities. In the case of labour inspectorates, human resources can range from over 2,300
labour inspectors in France to 56 in Ireland, with a ratio of 'inspector per employed persons'
being 1/11,290 and 1/36,000, respectively.34
Resource limitation is particularly acute in the
road transport field, where the capacity of national enforcement authorities – responsible for
carrying out controls of compliance with driving and resting time rules – has been decreasing
continuously since 2010. A drastic drop of 75% in the number of road transport control
officers (from 383.500 to 96.700) was noted between 2010 and 201235
, followed by a further
decrease of 16% between 2012 and 201436
.
Second, many national competent authorities lack the specialised knowledge to deal
effectively with cross-border cases. A number of challenges can be pointed out. There is an
issue with specialisation on cross-border cooperation and EU rules, as some Member States
have dedicated staff working on cross-border issues, whereas others do not (see Annex 12,
table 3). In this regard, training is crucial. Investigative staff sometimes lacks a common
understanding of procedures, in the case of social security coordination37
, or the capacity to
analyse data in digital tachographs, in the case of international road transport legislation38
.
Against the background of budgetary restrictions, funds for training dedicated authorities may
not always match the real needs39
. Similarly, linguistic difficulties are reported to be a
significant hurdle to efficiently and effectively operate in a cross-country context, making it
difficult for untrained staff to communicate with a counterpart in another Member State
and/or to understand a relevant document in another language40
. Finally, IT development
capacities also differ across countries, due to different levels of digitalization of
administrative acts or procedures, for example in case of registration systems on posting or
33
See for instance the European Quality Framework for anticipation of change and restructuring (COM (2013 882 final)
and the European Globalisation Adjustment Fund. See also Annex 6 for further relevant legislation.
34
It should be noted that the target set by the International Labour Organisation (ILO) at one inspector for every 10,000
workers Williams, C. (2017), Platform Survey Report, European Platform Undeclared Work, August 2017. See also
European Parliament, Effective labour inspections as a strategy to improve working conditions, European Parliament
resolution of 14 January 2014 (2013/2112(INI)).
35
SWD(2014) 342 accompanying the Commission report COM(2014) 709.
36
SWD(2017)100 accompanying the Commission report COM(2017) 117.
37
EU Platform to combat cross-border social security fraud and error, "Survey on mutual assistance in cross-border
investigations. Report to the Administrative Commission".
38
The number of trained enforcement officers in this sector in Europe decreased by around 35% (from 38.595 to 25.148)
between the reporting periods 2009-2010 and 2013-2014, SWD (2017)186.
39
OECD (2017), Skills for a High Performing Civil Service, OECD Publishing, Paris.
40
FreSsco (2017), Ad-hoc request on the Capacities of labour inspectorates to deal with cross-border cases in the Member
States; see also Jorens, Y., Gillis, D. and De Potter, T. (2017), Fraud and error in the field of EU social security
coordination, Network Statistics FMSSFE, European Commission, p. 55.
14
the digitalization of sickness insurance registers. This can also have an impact on the
effectiveness of possible checks and controls41
.
Different administrative capacities may impact in the efficiency of administrative processes,
for example the time necessary to reply to a request by another Member State, which often
requires more complex checks on national data42
. In addition, the training of administrative
staff on cross-border issues may also directly impact on citizens, if local authorities are not
prepared to handle correctly and clearly information on social security coordination rights or
establishment requirements43
. Almost 60% of enquires to SOLVIT concern social security
issues and their number doubled up to 1,100 per year between years 2012 and 2015.44
EU coordination on supporting administrative capacity-building on handling cross-border
situations so far is limited. At a more general policy level, recommendations on undeclared
work were issued in the context of the European Semester45
. Also, the EU supports different
projects, which remain of small-scale. This includes the mutual learning activities in the
context of the UDW Platform, training programmes of PES under the provision of the
common training programme for EURES (procurement under the European Programme for
Employment and Social Innovation (EaSI)), and individual projects, such as
Eurodetachement46
on the posting of workers. In road transport, Euro Contrôle Route (ECR) -
a voluntary network of European Transport Inspection Services – regularly organises the
training of controllers, albeit with limited geographical scope, as only some Member States
participate in such activities, and no harmonised training curriculum is in use.
Stakeholders' views
A majority (60%) of respondents to the public consultation on a European Labour Authority
were of the view that Member States' insufficient resources constituted a challenge to cross-
border cooperation. Similarly, within the context of targeted consultations, stakeholders
highlighted that differences in administrative capacities among the Member States act as a
barrier to effective cross-border cooperation; this was especially the case among members of
the Mutual Information System on Social Protection (MISSOC).
41
Specific training on cross-border cases is also important in the context of employment services. EURES holds a common
training programme to ensure that staff acquire specific knowledge on cross border matters and rules, and learn about
the different tools that facilitate cooperate in its network.
42
As shown in Annex 12 (Figure 2), average answering speed to IMI requests vary across the Member States. Answering
speed may depend on the complexity of the cases at hand but also on the relationship between the amount of cases to be
treated and the available staff (and internal procedures) on the receiving end.
43
See Annex 12, feedback from Your Europe Advice and SME feedback database.
44
Assessment of the performance of SOLVIT, Commission Staff Working Document, SWD(2017) 210 final.
SOLVIT provides swift solutions to issues encountered by citizens and businesses caused by the misapplication of
EU law by public authorities in cross-border situations. The service is provided by the national administrations.
45
From 2013, eight recommendations were issued as regards to fighting undeclared work in the framework of the European
Semester to Latvia (2013), Bulgaria (2013, 2015, 2016, 2017), Italy (2014) and Romania (2014, 2015, 2017).
46
VS/2016/0063 (http://www.eurodetachement-travail.eu/default.asp).
15
2.2.4 Weak or absent mechanisms for joint cross-border enforcement activities
Effective rule enforcement requires credible deterrence measures and capacities to detect and
sanction frauds and abuses, such as non-genuine postings, bogus self-employment, and letter-
box companies. While labour inspections are a national competence, the EU does not provide
a comprehensive institutional framework or operational support to inspection activities in
cross-border cases, with the exception of pilot activities in the context of the UDW Platform.
At present, coordination in cross-border inspections rests on voluntary cooperation between
Member States, which implies uneven geographical and thematic coverage, resources, and
patterns of cooperation. In the social security coordination domain, for example, international
inspections and monitoring actions are reported to be insufficient, beyond a few Member
States47
.
An established tradition of bilateral agreements (or informal arrangements) has developed as a
result of the lack of EU-level cooperation on inspections in the field of the posting of workers,
undeclared work and health and safety regulation. While there is no comprehensive and up-to-
date record of such agreements, some examples have been collected and analysed via the
UDW Platform48
and by the Eurodetachement project (see Annex 10.2). The Benelux
Workgroup has a particularly ambitious cooperation on cross-border fraud in the field of
posting and social security coordination,49
and similar arrangements are developed within the
Nordic Council50
. In the road transport sector, Euro Control Route (ECR) - a voluntary group
of European Transport Inspection Services – puts together 14 Member States to improve road
safety, fair competition and labour conditions in road transport, including through concerted
enforcement initiative51
.
While bi-/ or multilateral cooperation agreements have the advantage of being tailored to the
specific needs of the involved Member States, they also bear the risks of non-
institutionalisation and non-systematic approaches. An assessment of existing agreements in
the field of undeclared work pointed to key barriers, such as the lack of cooperation and
enforcement mechanisms, the volatility of political investment in cooperation, and technical
barriers to the exchange of information (e.g. differing legal competences between the
contracting authorities, languages, and data collection methods)52
. In the social security
coordination field, moreover, bilateral agreements on data exchange resulted in a variety of
47
Jorens, Y., Gillis, D. and De Potter, T. (2017), Fraud and error in the field of EU social security coordination, Network
Statistics FMSSFE, European Commission.,
48
Stefanov, R. and Mineva, D. (2017), National and Bilateral Agreements and Memoranda of Understanding to Tackle
Undeclared Work. UDW Platform Learning Resource Paper, April 2017.
49
Benelux joint declaration on cooperation in the fight against social dumping, Benelux Social Summit, 14 February 2014,
Brussels.
50
Members of the Nordic Council are Denmark, Finland, Norway, Sweden, the Faroe Islands, Aland and Greenland.
51
Members of ECR are: BE, LU, NL, FR, DE, IE, UK, PL, AT, RO, BG, HU, IT, HR.
52
Stefanov and Mineva (2017), ibidem. FreSsco, "On the capacities of labour inspectorates to deal with cross-border cases
in the Member States" ad-hoc study, November 2017
16
rules and procedures, with the resulting administrative complication53
, to be overcome with
the introduction of the Electronic Exchange of Social Security Information (EESSI) IT
system54
. Moreover, national administrations bear the entire operational and administrative
brunt of the organisation of concerted actions, including the coverage of unexpected limits to
an investigation as, for example, the need for a translator with workers of different
nationalities involved in a case.55
Similarly, the scope, content and functioning of these
bilateral agreements can vary substantially, with exchange of information and operational
aspects being subject to the will of the parties to comply with engagements.
The lack of common analytical and intelligence capacities can be seen as a related problem.
Some Member States dispose of advanced IT tools to collect, share, match and mine data with
a specific focus on fighting tax and social security fraud and undeclared work – complete with
early warning systems which may trigger inspections on the ground.56
However, these tools
rarely reach out beyond national borders, despite of the potential for fighting cross-border
fraud showed by some best practices, such as that of the Benelux Union57
. While in the road
transport sector the lack of data sharing seems to be particularly important, also in the field of
social security there have been calls to set up a European level database registering migration
outflows and inflows for the purpose of monitoring the place of residence of workers and
recipients of cross-border social security benefits.58
Stakeholders' views
Respondents to the OPC favoured an EU-level role in the coordination of joint inspections by
national administrations by 64%. Within the context of targeted consultations, a number of
institutional stakeholders underlined the value of national competence to carry out labour
inspections and the functioning of cooperation through bilateral agreements.
2.2.5 Lack of a cross-border mediation mechanism between Member States across all
domains of labour mobility and social security coordination
The management of cross-border cases involving national authorities in two or more Member
States may give rise to administrative disputes, for example in case of contested information
53
Jorens, Y., Gillis, D. and De Potter, T. (2017), Fraud and error in the field of EU social security coordination, Network
Statistics FMSSFE, European Commission, p. 92..
54
EESSI is currently being implemented by Member States: http://ec.europa.eu/social/main.jsp?catId=869
55
Mineva, D. (2018), Belgium-Netherlands cooperation: the case of the Port of Antwerp, UDW Platform.
56
European Platform to Tackle Undeclared Work, Thematic Review Workshop on Data Mining for More Efficient
Enforcement 1 & 2 June 2017, Helsinki, Finland.
57
In the case of the Benelux Union, the Steering Committee on Social Fraud/Social Dumping has promoted the automatic
data sharing, matching and mining on the issue of sham constructions. Political will and trust between the parties, as
well as effective national systems are deemed as key factors to build upon in order to develop such capacities (European
Platform to Tackle Undeclared Work, Summary report from the Follow-up Visit on 'Data Mining for More Efficient
Enforcement', 27-28 September 2017, Brussels, Belgium).
58
Jorens, Y., Gillis, D. and De Potter, T. (2017), Fraud and error in the field of EU social security coordination, Network
Statistics FMSSFE, European Commission, p. 92.
17
in PD A1 documents for posted workers. Recourse may be made to national courts and
ultimately to the European Court of Justice (ECJ). However, judicial recourse and
infringement proceedings are costly in terms of time and resources. Conciliation may
represent a more efficient and rapid resource.
At EU level, a conciliation mechanism exists only in the social security coordination area.
Annex 12 describes how the Conciliation Board (CB) acts within the Administrative
Commission (AC) to resolve disagreements. The dialogue and conciliation procedure has
certain in-built shortcomings.59
Both parties need to agree to bring the case in front of the CB,
the scope of conciliation is limited to the social security aspects of posting, while such
interpretation discussions and disagreements are also very relevant in other areas of social
security coordination such as family benefits or the determination of applicable legislation for
situations other than posting. Decisions are not binding and there is a lack of monitoring and
follow-up mechanisms.
Because of these challenges and the length of the process, the vast majority of cases are
resolved in a bilateral manner between Member States during the two phases of dialogue
procedure. Between 2010 and 2017 only nine cases were submitted to the Conciliation Board
of the AC. The full "life-cycle" of a case can be as long as over 3 years.
There is therefore potential for two-fold improvements. First, the existing conciliation
procedure in the context of the AC can be made more effective and a review is on-going to
address existing challenges. Second, a more comprehensive approach and more systematic
follow up to dispute settlement could be beneficial, extending to other areas of social security
coordination, to the posting of workers and to social legislation in the road transport sector,
where currently there is no dispute settlement mechanism among national authorities.60
Stakeholders' views
A majority (51%) of respondents to the public consultation on a European Labour Authority
were of the view that the lack of fora for dispute settlement constituted a challenge to cross-
border cooperation. Within the context of targeted consultations61
, social partners disagreed
on this point. While employers organisations, such as BusinessEurope, were more sceptical of
the idea of giving the ELA a dispute resolution function due to potential interference with the
work national courts and the ECJ, trade unions, including the ETUC, were more in favour of
the idea so long as the ELA provided out-of-court solutions. For the Nordic-Baltic-Polish EU
59
See e.g. EP Question E-009697-16 on Application of the dialogue and conciliation procedure established by Decision of
the Administrative Commission for the Coordination of Social Security Systems No A1.
60
Enforcement Directive 2014/67/UE has provided procedural rules for the exchange of information and administrative
cooperation between national authorities. No specific provision addresses the possible insurgence of disputes between
national administrations, for example in cases of non-compliance with requests for information or to execute sanctions.
61
Specifically at the dedicated hearing with social partners which took place 11 December 2017.
18
Information Group that absence of a forum for dispute settlement beyond the area of social
security coordination was a challenge.
2.2.6. Insufficient cooperation set-up at EU level
Several EU committees and networks operate in the area of labour mobility and social
security coordination (henceforth referred to as "bodies"). They are based on separate legal
acts and refer to specific thematic domains. While all were designed to support the
implementation of relevant EU rules, because they were developed independently, these EU
bodies are characterised by an asymmetric institutional design. For instance, only the AC has
quasi-legislative powers – being able to adopt interpretative Decisions – and meets on a
regular basis. Other committees (ECPW, FMW) act as discussion fora with little to no
decision-making or operational powers. The UDW Platform constitutes a forum based on
voluntary participation, with an analytical and operational focus, the latter having however
limited resources62
. Annex 7 provides a detailed presentation of each body and an overview of
its tasks. A further comitology Committee on Road Transport plays an advisory role to the
Commission and facilitates dialogue and mutual assistance between Member States in the
field of implementation of the social legislation in road transport63
.
Box 1. EU bodies in the areas of labour mobility and social security coordination
The EU bodies that make up the EU's institutional landscape in the areas of labour mobility and social
security coordination are: the Administrative Commission for the Coordination of Social Security
Systems (AC) (including its Advisory Committee for the Coordination of Social Security Systems, the
Conciliation and the Audit Boards, and its Technical Commission) the Technical Committee (FMW)
and the Advisory Committee (AFMW) on the Free Movement of Workers, the Committee of Experts
on Posting of Workers (ECPW), the European Platform tackling Undeclared Work (UDW Platform)
and the EURES coordination group. They play a valuable role in supporting cooperation between
national authorities. However, an analysis of their work reveals a number of shortcomings.
First, these EU bodies are limited in their ability to provide operational and technical support to
national authorities. Because of their asymmetric institutional design, only two of them provide
limited operational and technical support to national authorities. Specifically, the AC has a
conciliation mechanism, where a dedicated Conciliation Board addresses disagreements between
national authorities in matters of social security coordination. Similarly, the UDW Platform is
mandated to facilitate common activities between Member States. Otherwise, EU bodies are primarily
designed as fora for the exchange of information, good practices and ideas between relevant national
authorities and stakeholders. Accordingly, they are either not mandated or lack the capacity to provide
operational support to national authorities to strengthen cross-border cooperation. In practice, this
involves a limited number of activities to support staff exchanges, joint campaigns, trainings, and joint
62
The Senior labour Inspectors' Committee (SLIC) represents another relevant committee to discuss enforcement problems
related to EU legislation on health and safety at work. Although SLIC has recently adopted some initiatives addressing
the posting of workers, notably the application of health and safety rules in the case of cross-border temporary agency
workers, its focus is not strictly related to the scope of this initiative. Therefore, for the sake of brevity, its role is not
thoroughly analysed in the remainder of this report.
63
Its tasks include exchange of information on infringements against the social road transport rules, and penalties for such
infringements, discussing the cases of different national interpretations and application of the rules, promoting common
approach to implementation and enforcement. It meets irregularly and has no operational competencies.
19
inspections. Yet operational support on cross-border issues is something that Member States would
benefit from and which the EU is best placed to provide. The lack of operational capacity translates
into a joint action gap to address problems of cross-border nature.
Second, artificial separations exist between these bodies. In-depth specialisation of each committee on
its target legislation is not matched by the development of interlinkages with other bodies competent
on neighbouring policy areas. For instance, in the case of posting expertise is divided between labour
law specialists in the ECPW (on working conditions issues) and social security experts in the AC (on
security aspects, including the issuing of PD A1 forms), and likewise between the TFMW and the AC
as regards to mobile workers, while problematic issues may cut across the two policy areas. Certain
activities thus overlap leading to duplications in their work, for instance this is the case of UDW
Platform and the ECPW.64
Third, these bodies have no permanent structure. The frequency of the meetings varies greatly between
the over 90 meetings per year of the Administrative Commission (and of its attached committees,
under various formations and sub-groups) and the two meetings per year of the ECPW and technical
committee of FMW.
In addition, the EU has four decentralised Agencies in the employment and social domain (see
Annex 13). However, none of them has a cross-border focus in their mandate and, despite
valuable expertise in related fields such as labour market research (Eurofound), health and
safety at work (EU-OSH) and vocational education and training (Cedefop), they do not
provide any operational support to Member States either. Similarly, there is no EU agency in
the road transport sector, unlike in the other modes of transport (railways, aviation, and
maritime transport).
Box 2. Decentralised Agencies in the area of Employment
Four decentralised agencies operate in the employment policy area: European Foundation for the
Improvement of Living and Working Conditions (Eurofound), European Centre for the Development
of Vocational Training (Cedefop), EU-OSHA (European Agency for Safety and Health at Work) and
European Training Foundation (ETF) and they are currently object of a comprehensive evaluation.
Annex 13 provides an overview of their work.
An on-going meta-evaluation has been mandated to examine synergies among them. This evaluation is
done in line with the Commission's Better Regulation Guidelines and the Financial Regulation
requirements. It encompasses both an individual assessment of each agency as well as a cross-cutting
and comparative perspective for the period 2011-2016, and a prospective assessment with regard to
the future functioning of the agencies. The evaluation is not linked to the landscape of committees and
policy bodies in the area of cross-border labour mobility and social security coordination.
From a preliminary assessment, the material scope and functioning of each Agency presents few
elements of commonality with the present initiative. None of these agencies has a cross-border focus,
while the ETF operates in the EU neighbourhood area. Conversely, the specific expertise of each
agency contributes to relevant employment policy objectives in their respective fields, while the cross-
64
Cross-cutting issues in the implementation rules are dealt by the two structures separately. At the same time, the Platform
to Tackle Undeclared Work may discuss several cross-border fraudulent phenomena involving the posting of workers,
both under the labour law and the social security perspectives, yet in a different framework from that of the two
competent committees.
20
border labour mobility has a strong horizontal dimension. The predominant research-centred approach
of most agencies (except the ETF) only limitedly fits with the operational needs in the labour mobility
area. While there may be potential synergies as regards the research area, the analytical needs to
enhance operational cooperation on mobility exceed existing availabilities in the agencies and require
further and integrated expertise. A more thorough assessment of the possible interaction between this
initiative and the existing decentralised agencies is provided in section 8.
Stakeholders' views
As mentioned above, both respondents to the public consultation and targeted consultation
highlighted that differences in the administrative capacities among the Member States act as a
barrier to effective cross-border cooperation, thus supporting the view that insufficient
operational support at EU level was a challenge. On the issues of fragmentation, a majority
(70%) of respondents to the public consultation noted that the fragmentation of EU
cooperation networks in different areas of cross-border mobility was a challenge to effective
cooperation between national authorities.
2.3 How will the problem evolve?
EU labour mobility has shown an upward trend throughout the crisis (the number of people
living or working abroad almost doubled over the past decade, to 17 million by 2017), mainly
due to flows from the EU-13 and increasingly from Southern European Member States
towards Northern Europe.65
Besides, patterns of mobility have also evolved to cross-border
mobility and temporary mobility for the purpose of care treatment or service provision. The
posting of workers has surged by 68% compared to 2010 (from 1.23 to 2.3 million in 2016).
While remaining relatively low as a proportion of the total working population, EU mobility
still involves some 17 million EU citizens and particularly affects some countries (both from a
sending and from a receiving perspective) and economic sectors (see Annex 12.1). Also due
to the stabilising role played by labour mobility in the Eurozone in case of asymmetric shock,
there are few elements to assume that the relevance of EU mobility – in its various forms -
may scale down in the future.
In addition, the recent years have witnessed increasing concerns as regards to social fraud
related to cross-border mobility, e.g. in connection to social security coordination or posting
rules. Experimental estimates on a plurality of sources indicate a lower bound of about 2.6%
of EU-mobile workers (about 400,000 individuals) possibly involved in undeclared work
activities with variations across-countries. Similarly, fraud in social security coordination
does not currently affect but a minority of the total (See Annex 12.4). The phenomenon may
be underestimated, as it is based on figures from a few countries, although there is little
evidence that cross-border fraud is higher than domestic fraud.66
It could also be argued that,
65
See European Commission (2018), Annual Report on Intra-EU labour Mobility 2017.
66
Indeed, estimates in Annex 12.4 show that undeclared work may affect 2.8% of cross-border workers and 3.6% of
domestic workers.
21
absent adequate cross-border controls, social fraud is not realistically detected. In any case,
with possibly increasing mobility flows, social fraud will continue to represent an associated,
persistent element.
Recent legislative developments have addressed the problems of better information and
services to mobile citizens and companies, although more support will still be needed. As
mentioned in section 2.2.1, the Single Digital Gateway proposal, if adopted, may improve the
'findability' and quality-check of information provided through various EU sources, including
EURES. Nevertheless, content-feeding and constant updates of EU portals will remain
challenging and resource-consuming tasks to be carried out. As regards posting, the full
implementation of the 2014 Enforcement Directive has consolidated a set of single national
websites67
, while the free movement bodies established to support equal treatment and
provide legal assistance will also stabilise.68
However, ensuring even quality standards and
constant updates across the Member States will require constant monitoring at EU level.
Some sector-specific information, most notably on the working conditions and requirements
in international road transport operations, will have to be produced also in light of new
legislative initiatives in that area. Through the implementation of the 2016 EURES
Regulation, the number of job vacancies and CVs available on the Portal is expected to
substantially increase. Limits to national capacities and human, financial and IT resources
may however affect the expansion of the EURES network, with consequent needs for a
stronger involvement of partner organizations for a holistic approach and reinforcement of
activities in relation to information and services provision.
Recent legislative initiatives have also aimed at strengthening enforcement tools. Following
the 2014 Enforcement Directive, the use of the IMI system to exchange administrative
information and notifications between the Member States on postings will continue to take
hold. For social security coordination, EESSI will replace the current paper based exchanges
and it will allow national competent institutions to contact their counterparties in other
Member States electronically. It should create a faster, more efficient, and secure data
exchange. However, at the same time, the reasons for difficulties in cooperation encountered
today, beyond those of the inherently time consuming nature of postal exchanges, remain to
be tackled. There is a need to improve clarity on national case handling deadlines, put in place
operational procedures for addressing situations of delayed replies, and provide support to
Member States with capacity building to optimise the handling of cross-border cases, as well
as to provide ongoing support and training for the introduction and use of EESSI across all
institutions. Limitations (for instance in the case of undeclared work) and further
developments will be managed at EU level, although it is unlikely that synergies between the
instruments will be exploited.
67
https://europa.eu/youreurope/citizens/work/work-abroad/posted-workers/index_en.htm
68
http://ec.europa.eu/social/main.jsp?catId=1277&langId=en
22
Current cooperation tools will come under increasing pressure to ensure consistent and fair
enforcement of new rules currently under negotiations on posting, posting in the road
transport sector and social security coordination. While IMI statistics currently show that
information requests on the establishment and registration of companies rank as most frequent
(see Annex 12.4), control tools on letterbox companies would remain inadequate, for example
on the inspection angle. The UDW Platform provides for limited resources to support joint
inspections and capacity building, but the organisational effort in providing effective
coordination would continue falling on the Member States. Bilateral agreements would
continue providing the basis for cooperation with uneven functioning across the EU and few
extra EU resources to cover for limited resource capacities in some Member States, especially
where staff availabilities do not yield specialisation in cross-border issues. The problem
would notably be intense in the road transport area, where poor EU-wide coordination of
control activities would leave voluntary networks shouldering the impact of high pressure,
possibly new rules, and decreasing national enforcement capacities. While the UDW Platform
would continue to providing a forum of exchange of best practices, the cross-border
dimension represents but one aspect in the agenda and operational resources remain essential,
beside the limitation of the voluntary participation. In addition, mobility being constant,
ineffectiveness or absence of conciliation mechanisms between administrations would
continue discouraging dispute settlement fora and rather encourage court settlement. Finally,
in the occurrence of labour disruptions affecting multiple Member States, the relevant
authorities and stakeholders would dispose of the Globalisation Adjustment Fund and would
benefit from the guidance of the Quality Framework for Restructuring, yet with little further
assistance or coordination from the EU level.
2.4 Scope of a European Labour Authority
The thematic scope of the initiative will focus on the core areas of cross-border labour
mobility and social security coordination rules through the efficient and effective enforcement
of Union law on labour mobility and social security coordination, as well as of collective
agreements implementing such Union law. EU law on labour mobility pertains to the (1) free
movement of workers and the (2) posting of workers, which lay down workers' rights in
different mobility situations. Cooperation on (3) undeclared work is included, as it addresses a
phenomenon with particular relevance also in a cross-border context. Social security
coordination rules are tightly inter-connected, as they establish the rights to social security of
mobile workers, as well as of job-seekers and inactive persons when moving to another
Member State.
In line with the above legislation, the present initiative encompasses all economic sectors.
However, an additional focus is cast on the international road transport sector. The highly-
mobile nature of the sector creates specific problems for the enforcement of EU work-related
legislation in a cross-border context, in particular posting. Inconsistent and ineffective cross-
border enforcement, lacking cooperation and coordination of controls have severe
consequences on the fairness of competition for both drivers and companies.
23
The personal scope of the initiative would be in line with that of the EU legislation covered
in the initiative's thematic scope. This means that ELA would support Member States in the
implementation of EU rules in relation to the persons who are covered by these rules, for
instance by providing advice to workers on exercising the right to free movement of workers
or supporting the implementation of social security coordination rules in relation to all insured
persons to whom these rules apply (whether worker, family member, pensioner, tourist, etc.).
It also includes mobile third-country nationals, including EU Blue-Card holders, as regards to
posting of workers, road transport and social security coordination69
.
3. WHY SHOULD THE EU ACT?
3.1 Legal basis
The legal basis for ELA pertains to the free movement of persons and services and the right to
establishment, established in Articles 46, 48, 53(1), 62, and 91(1) TFEU.
Article 46 assigns to the European Parliament and Council the duty to issue rules on the free
movement of workers, including the cooperation between national employment services, the
abolition of obstacles to the search, matching and take-up of employment in another member
State. Article 48 provides a similar task with respect to the adoption of measures in the field
of social security as a necessary accompanying measure to the freedom of movement for
workers. As regards to the freedom to provide services across-border, Article 53(1) TFEU
foresees measures to facilitate taking up and pursuing activities as self-employed persons,
facilitating posting, while Article 62 TFEU foresees measures to facilitate the freedom to
provide services, relevant in the framework of posting. Article 91(1) TFEU posits common
rules applicable to international transport, in the framework of a common transport policy.
3.2 Subsidiarity
The subsidiarity principle applies since the proposal does not fall under the exclusive
competence of the EU. The objectives of the proposal cannot be sufficiently achieved by the
Member States at national, regional or local level and can be better achieved at Union level
for the following reasons:
 Providing high quality and up-to-date information and services to the public about
their rights and obligations in cross-border situations needs to be coordinated at Union
level in order to ensure a consistent, clear, and efficient approach.
69
Regulation (EU) No 1231/2010 extending Regulation (EC) No 883/2004 and Regulation (EC) No 987/2009 to nationals
of third-countries who are not already covered by these Regulations solely on the grounds of their nationality.
24
 The application of Union law in the fields of cross border labour mobility and social
security coordination relies on cooperation between Member States, meaning that no
Member State can act alone.
 In order to increase synergies and support cooperation between Member States in the
application of Union law across the fields of labour mobility and social security
coordination, to ensure legal certainty for administrations and individuals alike and to
arrive at a shared understanding of enforcement needs, it is also necessary to develop a
coordinated and joint approach at Union level instead of relying on what can be a
complex network of bilateral or multilateral agreements.
3.3 Proportionality
The initiative is a proportional response to the need for operational support and does not go
beyond what is necessary to achieve this goal. It does not impose new obligations on Member
States, individuals or employers; rather it focuses on supporting cross-border mobility and
creating new opportunities. The proposal does not impinge on national decision-making,
legislation, or enforcement activities, which remain the competence of Member States.
Moreover, it leaves to a large extent to the discretion of Member States how they make use of
the possibilities put in place by the initiative.
4. OBJECTIVES: WHAT IS TO BE ACHIEVED?
4.1 General objective
The establishment of ELA will help strengthen fairness and trust in the Single Market by
ensuring that EU rules on cross-border labour mobility and social security coordination are
enforced in a fair, simple and effective way and by supporting the mobility of individuals and
businesses through practical information and assistance.
4.2 Specific objectives
ELA will function as a permanent structure and will pursue three objectives in this context:
 Improving access to information by individuals and employers about their rights and
obligations in the areas of labour mobility and social security coordination, as well as
access to relevant services;
 Strengthening operational cooperation between authorities in the cross-border
enforcement of relevant Union law, including facilitating joint inspections;
 Providing mediation and facilitating solutions in cases of disputes between national
authorities and cross-border labour market disruptions, such as restructuring of companies
affecting several Member States.
25
5. WHAT ARE THE AVAILABLE POLICY OPTIONS?
Options to meet the aforementioned three specific objectives are of two kinds: first, what
should be done (tasks) and second, how should this be done (delivery aspects). In analysing
the different policy and delivery options, no environmental impacts have been identified.
Therefore this document does not consider environmental impacts as a criterion to
differentiate between the options.
Prior to examining possible policy options, this section outlines options that were discarded at
an early stage.
1) Transferring new competences from the national to the European level
Rule enforcement, information collection and treatment and inspection responsibilities are the
competence of national authorities, in line with subsidiarity and proportionality requirements.
These competences cannot thus be transferred to the Union level, either in the form - for
example - of a European labour inspectorate or through more competences and powers
granted to the European Commission. This option is rejected by the unanimity of institutional
stakeholders and social partners.
2) Extending the scope of the proposal to cover EU legislation dealing with industrial
relations
EU legislation in the area of cross-border industrial relations covers negotiations and
agreements in EU transnational companies (that have a workforce in more than one Member
State) and workers' representation in multinational companies (European Work Councils) in
companies with over 1000 workforce, and at least 150 in each of two or more Member States.
The implementation of industrial relations in cross-border labour situations is the domain of
the social partners, not Member State authorities, and is hence left out of the present initiative.
This is also in line with the ETUC’s position that there should be no interference with
collective bargaining or the right to take collective action. While ETUC supports the set-up of
tools such as mediation mechanisms to resolve disputes, on a voluntary basis, on the
implementation of transnational agreements in the case of multi-national companies, this was
not echoed by other stakeholders throughout the OPC.
6. POLICY OPTIONS AND THEIR IMPACTS
In order to address the identified challenges that undermine compliance with EU rules and
effective cross-border labour mobility (see section 2), seven general tasks are envisaged for
the EU level:
 Labour mobility services and information for individuals and businesses tackles the
problem of inadequate support and guidance for individuals and businesses in cross-
border situations (section 2.2.1);
26
 Cooperation and exchange of information between national authorities addresses the
problem of insufficient access to and sharing of information between national
authorities (section 2.2.2);
 Support to joint inspections: tackles weak EU-level mechanisms for joint cross-border
enforcement activities (section 2.2.4)
 Cross-border labour mobility analyses and risk assessment; targets both insufficient
capacities to organise cooperation (section 2.2.3) and the weak mechanisms for cross-
border enforcement (section 2.2.4);
 Capacity building: enhances the capacities of competent authorities (section 2.2.4);
 Mediation between national authorities fills the gaps in the existing conciliation
mechanism (section 2.2.5);
 Facilitating cooperation in cases of labour market disruptions affecting more than one
Member State addresses the issue of insufficient capacities to cooperate (section
2.2.3).
As regards to the specific problem of insufficient cooperation set-up at EU level (section
2.2.6), this is addressed by all of the above tasks, which together would provide
comprehensive operational and technical support to national authorities.
Below, following the presentation of a baseline scenario, three policy options (‘support’,
‘operational’, ‘supervisory’) are presented, each addressing the seven tasks outlined above.
The options are cumulative, that is, each option broadly incorporates the features of the
previous one. They each provide a set of coherent and interdependent tasks, making them
almost indivisible. Table 1 below provides a synoptic overview of how the seven tasks will be
addressed in each of the three policy options. A more detailed explanation and comparison of
the tasks as envisaged under the three policy options is provided in Annex 10.
 For instance, under Policy Option 2, it is envisioned that the EU level has an important
role in pooling of analyses, collecting data, and organising peer reviews (task 'Cross-
border labour mobility analyses and risk assessment'). This task is intimately linked
with the creation of a comprehensive mutual-learning programme and
training/technical assistance programme (task 'capacity building'), since the data
analyses will feed into the design of these programmes. The two complementary tasks
have the same level of ambition.
 Similarly, for instance, under Policy Option 3, the EU's task to undertake in-depth
assessments of Member States to identify problems (task 'Cross-border labour
mobility analyses and risk assessment') is intimately linked with the task of
establishing standards for the provision of services at national level based on EU rules
(task 'Labour mobility services for individuals and businesses'), and establishing
mandatory requirements on information exchange (task Cooperation and exchange of
information between national authorities), also only envisioned under Option 3. The
two complementary tasks have the same level of ambition and are interdependent
27
since the standards and mandatory requirements it establishes would form a basis for
recommendations.
Table 1. Synoptic overview of policy options, in relation to tasks
Tasks
Policy Option 1
(Support Option)
Policy Option 2
(Operational Option)
Policy Option 3
(Supervisory Option)
1. Labour mobility
information and
services for individuals
and businesses
Definition of user needs and
business requirements of the
EURES Portal. Cooperation
with relevant initiatives, tools
and bodies at EU and
national level (e.g. Your
Europe, Border Focal Point,
national services).
Coordination and enhancement
of EURES network. Technical
support to MS for the provision
of services at national level,
including compliance with
relevant obligations (e.g. SDG
and enforcement directive on
posting).
Establishing standards for
the provision of services at
national level based on EU
rules.
Establishment of a single
physical national contact
point on labour mobility.
2. Cooperation and
exchange of
information between
national authorities
Coordinating role and liaison
point between existing
bodies.
Active support and expertise to
competent authorities ensuring
cooperation and promoting the
exchange of information through
the use of relevant IT tools
(ESSI, IMI).
Establishing mandatory
requirements on information
exchange, where not
provided for by current EU
legislation
Development and inventory
of user-friendly templates in
aid of comparability of
national procedures.
3. Support to joint
inspections
Support to Member States in
coordinating joint
inspections, i.e. organisation
of coordination meetings and
development of model
agreements
Pro-active proposals for joint
inspections, logistical support,
monitoring and follow-up
Possibility to launch (joint)-
inspections on its own
initiative
Management of European
Inspection Corps (drawing
on Member States'
inspectorates)
4. Cross-border labour
mobility analyses and
risk assessment
Sharing of studies and
analyses by relevant EU
bodies
Analyses, risk assessment, data
collection, peer reviews and
follow-up recommendations.
In-depth assessments of
Member States
5. Capacity Building
Coordination of mutual
learning activities across all
mobility areas
Set-up of comprehensive
mutual-learning, training and
technical assistance
programmes, exchange of best
practices.
Development of pilot code
for labour inspections.
6. Mediation between
national authorities
Provision of expert opinion
upon request on all mobility
areas
Facilitation of dispute settlement
across all areas by mediation,
including possibility to adopt
recommendations.
Development of pilot on out-
of-court dispute settlement
7. Facilitating
cooperation in cross-
border labour
disruptions
Awareness raising among
stakeholders about the EU
Quality Framework for
Anticipation of Change and
Restructuring (QFR) and of
relevant EU legislation and
financial instruments.
Upon request, set-up of ad hoc
support to national authorities
and stakeholders to facilitate
administrative cooperation,
information sharing and
coordination in the event of
cross-border events of company
restructuring.
Issuing of recommendations
as regards to the
management of cross-border
restructuring, and to the
implementation of relevant
EU legislation, including
business insolvency and
information and consultation
of workers.
28
6.1. Baseline scenario
Without any action, the existing legislative framework continues to apply to mobility
information and rule enforcement support, with possible integrations deriving from proposals
currently under negotiation or implementation.
Content creation, update and expansion of the Your Europe and the EURES Job Mobility
portals remains mainly up to the Commission and the Member States, with limited EU
coordination and support on other mobility issues such as posting or road transport. Exchange
of administrative information takes place through the IMI and, from 2019, EESSI, beside
other channels possibly established on an ad-hoc basis through bilateral agreement. The
Commission carries out labour mobility analyses, while more sophisticated risk assessments
are developed at national level with little to no pooling at EU level. Coordination of cross-
border inspections remains limited to voluntary action within the current scope and means of
the UDW Platform and, for what concerns the road transport sector, the ECR. Existing
conciliation mechanisms continue to apply in the social security coordination domain, but not
in other mobility areas. Capacity building is limited to the mutual learning programme of the
UDW Platform and to voluntary action within the scope of the ECR in the road transport area.
The Commission raises awareness on the good practice collected in the 2013 Quality
Framework for Restructuring and runs the European Globalisation Adjustment fund, while
Eurofound monitors company restructuring events and provides information on national
frameworks for restructuring through the European Restructuring Monitor.
6.2 Policy Option 1 (Support option)
The ‘support’ Option 1 constitutes a ‘light-touch’ approach adding up a few changes to the
baseline scenario whereby the EU level expands or coordinates existing activities or
programmes, or extends these from one specific area to all other mobility areas. The EU-level
expands and coordinates existing information services by ensuring further development of the
EURES portal and, in cooperation with Your Europe, by monitoring information provided on
posting and road transport sector legislation. It also builds on existing cooperation tools in
different mobility areas by promoting coordination between them and suggesting
improvements on issues of cross-cutting concern (e.g. letterbox companies). It extends current
support to joint inspections in the context of the UDW Platform by facilitating coordination
meetings between labour inspectorate authorities and developing model agreements, upon the
request of Member States. It compounds analytical reports dealing with different mobility
aspects produced by EU and national institutions and ensures follow-up to problems signalled
by citizens and companies on SOLVIT. Mutual learning activities under the UDW Platform
are extended to all mobility areas in order to support administrative capacity building in
accordance with strategic priorities. The EU level extends the conciliation mechanism of the
social security coordination area to all mobility areas through the provision of expert opinions
and monitors the follow up to those opinions. Drawing on the Quality Framework for
Restructuring, the EU level raises awareness of its legislation, financial instruments and
29
guidance also based collection of experiences through Eurofound's Monitoring instrument in
order to support stakeholders affected by restructuring cases with cross-border implications.
6.3 Policy Option 2 (Operational option)
The ‘operational’ Option 2 expands activities laid down in the previous Option 1 by adding
further operational activities in each task. Through the management of the EURES network,
the EU level extends the scope of its activities to technical support to the Member States for
the provision of information to citizens and business all across the mobility spectrum, thus
including posting and social legislation in the road transport sector. The information exchange
is actively supported through the promotion of the use of electronic tools and procedures (e.g.
EESSI, EURES and IMI) also with a view to their further evolution, as well as on facilitating
cooperation through National Liaison Officers. In agreement with the involved Member
States, it assumes the role of launching and providing coordination and logistical support to
joint cross-border inspections including action to ensure their follow up. The EU level
compounds analyses and data collection on different labour mobility aspects from different
sources, and becomes a permanent observatory on mobility, also through the collection of
more specific data to inform joint inspections or capacity building programmes; it organises
peer reviews among Member States and outlines possible measures to address identified
challenges. The EU level runs comprehensive mutual learning and technical assistance
programmes, also in accordance with the priorities identified in the other tasks. The existing
conciliation mechanism, which is extended to all mobility areas, is formalised by a mediation
mechanism aimed to provide the possibility of recommendations to the involved Member
States to solve issues identified. In the event of restructuring cases with cross-border
implications, the EU level activates – upon national authorities' request - ad hoc support
charged facilitating administrative cooperation, providing guidance on EU legislation and
financial instruments and coordinating interventions, including through involving EURES.
6.4 Policy Option 3 (Supervisory option)
The ‘supervisory’ Option 3 expands activities laid down in the previous Option 2 to achieve a
more thorough EU-level integration of certain functions which are not foreseen in the current
framework, yet within the limits of EU competences. Through the management of EURES,
the EU level adds up standards for the provision of mobility-related services to citizens and
companies at national level with a view on the establishment of single physical contact points.
Where necessary, the EU level can set additional mandatory information exchange
requirements to be implemented through the existing tools. On joint inspections, the EU level
retains the right of initiative and sets up a specialised 'European Inspection Corps' composed
of national detached experts. Drawing on peer reviews and labour mobility analyses, the EU
level can launch in-depth assessments of Member States capacities for a thorough analysis of
potential weaknesses and shortcomings, and on these basis issues recommendations to
Member States. In addition to the mutual learning and technical assistance programmes for
capacity building envisaged in Option 2, the EU level lays down a common rule-book (code)
30
laying down standard procedures for labour inspections. The mediation mechanism extends to
include a pilot out-of-court arbitration systems for certain cases. The EU level intervenes both
to provide guidance on available EU resources to address cross-border labour disruptions,
but also to provide recommendations to national authorities and stakeholders on the effective
application of relevant EU legislation, including on insolvency and information and
consultation of workers.
Stakeholders views on the possible tasks of a European Labour Authority
Regarding the possible tasks for a European Labour Authority, the open public consultation
showed that a majority of respondents envisioned that a new Authority could usefully provide
a wide range of operational support to Member States. These include: coordinating systematic
cooperation and information exchanges between national authorities (75%), providing
technical assistance and capacity building to enforcement authorities (67%), providing
analytical support and intelligence (67%), coordinating joint inspections (64%), providing a
dispute resolution mechanism (64%), supporting the provision of information to individuals
and businesses (73%), support the rationalisation and streamlining of administrative practices
at EU level (73%).
Results of the targeted consultations echoed the same support for a broad range of tasks; in
particular members of the Administrative Committee were generally supportive of ELA
having an operational focus. Consulted stakeholders, most notably within the EMCO and the
UDW Platform, also underlined that an Authority could support the better integration and
coordination of existing EU bodies in order to ensure greater synergies between them.
There was clear support among stakeholders – including within the AC, the ECPW, the PES
network, social partners (UEAPME, ETUC, EFBWW, etc.), and a number of civil society
organisations - for a new European Labour Authority to play a role in providing a single point
of access to standardised information available in all European languages to individuals and
organisations alike. A number of stakeholders underlined that the Authority could also be
charged collecting and regularly updating listings of EU and national relevant legislation and
competent authorities.
Similarly, there was strong support among stakeholders for a new European Labour Authority
to act as a platform for information exchange between national authorities. It was also
underlined by certain stakeholders that ELA could manage IT solutions (such as EESSI, the
future ESSN) and ensure statistical data collection. Closely related to this, some stakeholders
(including members of the AC) underlined that ELA could support research and analysis in
the area of cross-border mobility.
A number of targeted stakeholders shared the view that ELA could usefully provide technical
assistance and capacity building to enforcement authorities. In particular, BusinessEurope was
of the opinion that technical assistance and capacity building for national enforcement bodies
31
should be the central aim of the initiative. A common opinion by the PES network suggested
that ELA could help to strengthen collaboration among different labour market actors at EU
level and support a systematic approach for evidence-based learning between Member States,
building on the Benchlearning exercise of the PES network.
Institutional stakeholders broadly underlined the importance of respecting national
competencies, particularly in the area of labour inspections which should remain in the hands
of Member States. However, a great number of stakeholders (including those who underlined
the importance of respecting national competencies) were also of the opinion that a European
Labour Authority could valuably support national authorities in conducting joint cross-border
investigations. In particular, this point was made by members of EMCO. A report adopted by
the UDW on the creation of ELA noted that while any joint investigations should be entrusted
to national authorities, ELA could address outstanding issues, such as cross-border
participation in controls in another Member States, facilitating the understanding of other
national laws and procedures, and of the effective use of evidence during inspections. At the
dedicated hearing with social partners, trade unions noted that while a European Labour
Authority should not interfere in functioning of national labour inspections, it could have
complementary role in cross-border cases, providing technical and logistical support. The
European Parliament's Employment and Social Affairs Committee argued that ELA could
conduct investigation in cases of fraud and abuse.
Similarly, a number of targeted stakeholders were of the view that a new Authority could
carry out dispute resolution mechanisms in cross-border and social security matters, but were
split on whether the decisions should be binding or whether the process should be voluntary
and decisions non-binding. For instance the UDW platform noted that ELA could act as a
discussion board to facilitate exchanges and as mediator to solve problems between Member
States on a voluntary basis. Similarly, in a strategic dialogue with civil society, certain
organisations noted that ELA could support a dispute settlement mechanism similar to the one
currently in place within the Administrative Commission. It was suggested that such a dispute
settlement mechanisms could be extended beyond social security coordination to other areas
of cross-border mobility and could be binding.
6.5. Impacts of the different policy options in relation to tasks
This section summarises the main expected social and economic impacts of each the three
policy options outlined in the previous section. The assessment has a strong qualitative
approach. While better cooperation has an impact on improving enforcement, the causal link
between the set-up of a new body and socio-economic impacts, including mobility flows, is
rather remote, owing to the influence of national legislation and to actual rule implementation.
Therefore, the quantification of social or economic impacts was not deemed realistic.
32
6.5.1 Social impacts
Overall, the social impacts of the three policy options would be direct only in the cases of the
task relating to citizens' information and services and to the facilitation of solutions during
company restructuring processes. The remaining benefits would rather be indirect, as a
consequence of better cooperation and information-sharing between national administrations.
Under the baseline scenario mobile workers and citizens would continue experiencing
information gaps and to be exposed to the risk of abuse or of administrative inefficiencies.
Posting conditions (e.g. applicable wages) may become more transparent thanks to single
national websites, but still work would need to be done to improve the sector-specific
targeting of information, notably - but not exclusively - on road transport posting and social
rules. Channelled through the SDG, EURES would gain more findability but still incur
limitations in the extent of information provided, as well as in the capacity to extend job
vacancy supply.70
Exposure to fraud or administrative inefficiencies would witness some
improvements, but still present some gaps, with particular effect on the road transport sector.
Information exchange through IMI contributes to strengthening controls, and so will the
implementation of EESSI, also with a view on administrative efficiency. Nevertheless,
varying degrees of administrative capacities and extent of bilateral cooperation with other
Member States would continue negatively affecting the effectiveness of protection against
abuses, for instance in fraudulent posting situations, with generally few opportunities for
coordinated cross-border controls and inspections. Information gaps – also cause by the lack
of preparation of administration staff may continue leading to low take-up of social security
benefits across border simply because of citizens' low awareness. In turn, ineffective
communication channels between social security institutions may result in the missing out on
acquired rights or could lead to double payments (see Annex 12, section 4)71
. In the event of
company restructuring cases with cross-border implications, the EU level would continue to
offer soft policy guidance on the basis of the Quality Framework for Restructuring and
financial assistance through the European Globalisation Adjustment Fund, within the limits of
eligibility conditions to that fund. Tailored support may continue to be provided ad hoc such
as in the case of the closure of the Caterpillar plant in Gosselies (Belgium)72
.
Policy Option 1 (support option) would marginally improve the provision of information
through more integration of EURES with other information areas, including on terms and
conditions for posting. A citizen may thus find on the EURES portal more comprehensive
70
EU Court of Auditors, Free Movement of Workers – the fundamental freedom ensured but better targeting of EU funds
would aid worker mobility, Special Report 6/2018.
71
Your Europe Advice documents real cases where documents and information requests are made by individuals even
though national authorities should communicate directly with one another. For example, a Romanian citizen living in
France experienced long delays in obtaining details of his pension rights for the years he had worked in Romania. In
another instance, a Lithuanian citizen working in Italy could not receive confirmation that she was paying social
insurance contributions in Italy and was therefore requested to still contribute to the Lithuanian health insurance.
72
Following the 2016 closure of the Caterpillar plant in Gosseliens, Belgium, the Commission set up a joint taskforce with
the national and regional authorities, upon their request, to support the Charleroi region in dealing with the employment
and social impacts.
33
information regarding its citizenship, labour, social and fiscal rights when moving to another
Member State, under different forms of mobility (permanent or temporary mobility).
However, information as well as some underlying services would be provided at a fairly
general level which may not reflect his/her particular needs in a given sector, e.g. road
transport, or administrative area. EU support to activities in the areas of cross-border labour
inspections, intelligence and dispute settlement would remain limited, therefore tangible
benefits for workers would be unlikely to materialise. Under largely voluntary cooperation
arrangements between Member States, workers in or from non-cooperating countries would
notably be at a disadvantage in relation to workers in or from cooperating countries choosing
to engage in exchange of information and cooperation. Therefore, the benefits would be
uneven for the workforce and citizens across the EU and not be available or easily accessible
to all those that need them. In case of relevant company restructuring processes, EU
intervention would be limited to awareness raising on the available EU instruments but would
not translate into more concrete support to the involved stakeholders, thus with a limited
impact on the involved workers.
Policy Option 2 (operational option) would lead to a wider access to targeted information
and a wider inter-connection between all EU provided services, basing on the EURES
network. With further technical monitoring and support provided to check the
comprehensiveness of information, EU-level assistance would integrate sector-specific
guidance for example on posting and help aligning with SDG-mandated quality standards.
Therefore, a citizen moving to another Member State to work in a particular sector, e.g.
construction, would find targeted information on working conditions in that sector, including
for example the relevant collective agreement or specific health and safety requirements, in
this case thanks to collaboration with the competent agency EU-OSHA. With EU-provided
coordination of investigations, notably focusing on problematic cross-country flows and
sectors identified thorough risk assessment, workers would rely on stronger deterrence
potential, as well as on a contact point to which they could turn to in case of need. For
example, in the road transport case, more uniform controls would ensure legal clarity and
predictability for drivers and guarantee equal treatment in case of non-compliant behaviour,
due to more uniform assessment standards. Citizens would also benefit from better
administrative efficiency resulting in faster and more certain procedures for the assignment of
cross-border social security benefits, and less uncertainty in case of problematic situations as
a result of more structured information exchange between authorities in all areas. The
intensification of EU-provided training for national administration staff would also ensure
better information being conveyed to citizens, for example on their cross-border social
security rights, and workers, notably including international transport drivers. While citizens
would continue solving possible disputes with administrations through existing means (e.g.
SOLVIT or courts), new mediation functions may shorten the period for a decision on
disagreements between national administrations and increase the impact of such decision. In
the event of company restructuring with cross-border implications, the facilitating role which
the EU level would play would especially benefit the affected workers. National stakeholders,
34
notably including the social partners, would receive advice and guidance on applicable EU
legislation and possible financial instruments to assist the affected workers, as well as
administrative support to coordinate interventions between countries for example on
collaboration with EURES for job-search beyond national borders.
Policy Option 3 (supervisory option) would entail more mandatory requirements on the
services provided through the EURES network of experts, which would advise – as in the
option above – on all policy areas. The set-up of physical contact points for labour mobility at
national level would enable citizens to access a face-to-face service to collect practical advice
in view of their moving to another Member State. More stringent EU requirements would
empower information exchange and cooperation on inspections, and strengthen institutional
capacities. Citizens would thus benefit from more integration between national
administrations in carrying out controls against abuses as well as in exerting more ordinary
administrative procedures, for instance in posting situations. EU level recommendations on
the management of cross-border company crises may have an appealing character insofar as
they may put pressure on authorities and stakeholders to mobilise all possible EU and national
resources to help workers retrain or re-employ.
6.5.2 Economic Impacts
Examining the economic impacts of different policy options covers both the impacts on
national authorities and on companies.
6.5.2.1. Impacts on national authorities
This section discusses the impact of the three options on the work of national authorities to
improve their cooperation, to better enforce rules, to facilitate labour mobility and to provide
information to workers and business.
In the baseline scenario, competent enforcement authorities would continue operating with
only partially adequate and resource-intensive tools, thus with partial effectiveness in terms of
contrasting social fraud and ensuring administrative efficiency. The fight against social frauds
would continue to be pursued through the existing (and forthcoming) information exchange
tools and several structures working in parallel with a focus on specific areas (such as
undeclared work, or social security). While the full implementation of IT tools is expected to
continue providing added value73
, enforcement authorities would continue to work with a
focus on questions related to specific policy areas (such as posting, social security
information, or transport company information), with little incentive to exploiting the possible
synergies between them to investigate potentially fraudulent cases requiring a multiplicity of
73
Annex 12 shows that information exchanges on the posting of workers through the IMI system have increased from 806
in 2012 to 1689 in 2016 and over 3,600 in 2017. However, the use of IMI varies substantially between Member States,
with Austria, Belgium and France being the most frequent users. Moreover, the IMI modules may not always be fit for
the specific request needed for an investigation (Horodnic, I.A., Belgium-Romania cooperation. An overview of IMI
cases, 2018, UDW Platform).
35
policy details. Authorities would continue lacking a common source of intelligence and risk
analysis. Most notably, however, the effort to organise joint actions (e.g. in-depth information
exchange and coordinated inspections) would continue falling upon national authorities with
no external support. Investigative cooperation would be efficient to the extent that authorities
share similar or common investigative methods and procedures, basing on a common
understanding of the respective laws and on a common action framework, such as a bilateral
agreement74
. One or more of these factors being absent or weak, for instance the lack of
mutual language understanding or the difficulty in identifying one authority's exact
counterpart in the other Member State, would continue making joint action very resource-
intensive and ineffective, notably against the background of staff resource scarcity across the
Member States. All in all, the inadequacy of tools and cooperation would continue producing
considerable losses in fiscal and social security revenue, while feeding in mistrust between
administrations.75
In the absence of changes to the conciliation mechanism addressing its
unpredictable length, national authorities would remain encouraged to settle possible disputes
on an ad hoc basis and relying on bilateral exchanges in the social security coordination area.
Finally, in cross-border labour disruptions events, national authorities would continue to turn
to the EU level to apply for and seek technical assistance on the available funds, including the
European Globalisation Adjustment Fund. Policy support would continue to take place in the
soft form of the Quality Restructuring Framework.
Policy Option 1 (support option) would partially improve the tools available to enforcement
authorities. National authorities would also benefit from an EU-level support and tentative
coordination of joint inspections, coupled with tailored mutual learning activities embracing
all mobility areas to reinforce administrative capacities on priority areas to be identified
depending on need. Yet, EU-level oversight on information exchange tools would not
significantly contribute to advancing the capacities of enforcement authorities, with a
particularly negative effect in the road transport area, due to very limited cooperation and lack
of support platforms. Authorities may also benefit from expert opinions in all mobility areas
in case of disputes, but this would limitedly increase the incentives to use this route to settle
disputes. This option would partially improve the visibility and mobilisation of EU tools
available to competent authorities and stakeholders, who would increase their awareness of
74
Belgian and Dutch authorities, for example, share an established tradition of cross-border cooperation leading to a
common understanding of each other's services' competences, working methods and needs. A common language is also
reported to be an important success factor of cooperation (Mineva, D., Belgium-Netherlands cooperation: Port of
Antwerp case, 2018, UDW Platform).
75
In the road transport sector, it is estimated that the fiscal loss per vehicle per year for the Member State where the
company should be established (where the haulier actually operates) is around €6,000. Labour-related losses per driver
per year for the Member State where the drivers should be paying social contributions are in the range of €30,000-
€40,000 and could yield an EU-wide annual loss of income for the Member States where the drivers should be paying
social contributions in the range of €64.5-€86 million (IA to support proposal on Better access to the EU road haulage
market (SWD(2017) 194 final). As an example, In March 2017, there was an investigation by the Belgian authorities
into Belgian hauliers having established letterbox companies in Portugal and Slovakia. The Belgian authorities found 25
letterbox companies registered in the same address in Slovakia. The estimated unpaid social contributions in Belgium
amounted to €6-€7 million (http://www.dhnet.be/actu/belgique/perquisitions-transport-des-dizaines-d-entreprises-
belges-a-la-meme-adresse-en-slovaquie-58c98319cd705cd98df5f04c.)
36
existing instruments and measures applied in different national frameworks and restructuring
cases as inspiration for developing national policies, although no further operational support
than is currently provided would be offered.
Policy Option 2 (operational option) would significantly reinforce the cooperation and
coordination tools available to public authorities, with possibly more tangible effects on the
capacity to address social fraud and manage cross-border situations. National authorities
would benefit from a more centralised support for IT tools for information exchange and from
more comprehensive oversight and recommendations on possible synergies and follow-up
actions to address problems. A more coordinated hands-on approach may also incentivise the
further digitalisation of procedures. A more structured, integrated and operational intelligence
capacity would bring an added value to national enforcement authorities to the extent that it
would enable to compound different data sources, identify recurrent patterns of mobility or
possible fraud, and draw general lessons for the follow up, thus helping national authorities to
target their cooperation and investigative action. EU-level support to joint investigations and
inspections would both facilitate operations thanks to a progressive streamlining of
procedures and practically complement national resources on more resource-intensive tasks,
including for example translation of relevant documents. The virtue of EU-support to cross-
border investigative activities has already been proven in the existing example of Eurojust,
which would provide a useful model.76
On the basis of common activities, mutual learning
and technical assistance programmes would have a more concrete reference. In case of
dispute, a revamped conciliation mechanism, which can relate to all cross-border labour
mobility areas but also lead to recommendation on how to follow-up would contribute to
resolve cases more timely. Finally, national authorities would benefit from technical support
in complying with relevant obligations in the provision of services and information to citizens
and businesses, which would contribute to reducing cases of duplication of requests and
addressing gaps in specific policy domains, for instance in the road transport sector. In the
event of labour disruptions with cross-border implications, authorities – but also the social
partners - may have the option of requiring assistance to the EU level to help facilitating a
solution in order to mitigate the social consequences of restructuring processes, most notably
through the coordination of the involved stakeholders across borders and support to
application for EU funding opportunities.
Policy Option 3 (supervisory option) would provide for more stringent cooperation rules for
national authorities with possible negative impact on national capacities, especially in
Member States with administrative staff shortages. The creation of physical contact points for
information to citizens and companies would require, for example, dedicated infrastructures
and resources, which may also duplicate existing obligations in other fields. Mandatory
76
In the context of Eurojust, joint inspection teams (JIT) jumped from 5 in 2003 to 69 in 2016. The number of coordination
meeting increased from 20 in 2002 to 197 in 2014. The number of coordination centres has increased steady since their
creation in 2011, with seven set up in 2012 and 2013 and ten set up in 2014. Eurojust, Evaluation of the Eurojust
Council Decision and the activities carried out by Eurojust, Final report, 2015.
37
information exchange requirements, in addition to those agreed, for example, in the IMI
system, may place an excessive burden on Member States, also in relation to the
administrative capacities of a Member State. Likewise, the possibility for the EU level to
request joint inspections and send a dedicated EU team on the ground for support may create
excessive burden on Member States, and staff resources may not be sufficient to comply with
multiple requests. Strengthening capacity building through a binding code for inspections may
have the advantage of harmonising information exchange and inspection procedures.
However, it may set an excessive constraint on national competent authorities in respecting
different procedures than their own national ones, thus also reducing their degree of freedom
in line with national legislation and practices. EU-level recommendations, albeit non-binding,
on the management of cross-border labour disruption cases would risk going beyond the EU's
role in such instances, interfering with the prerogatives of national authorities and of the
social partners.
6.5.2.2 Impacts on employers
This section analyses the impact of the considered options on employers. As in section 6.5.1
impacts are direct as regards to the information and the restructuring tasks, whereas on the
remaining tasks impacts can be assumed to be mostly indirect, as a consequence of more
effective rule enforcement and transparency.
In the baseline scenario, employers would continue to rely on existing tools – however more
accessible thanks to the SDG – to retrieve information on working conditions, fiscal and
social security when establishing or posting workers in another Member States. To the extent
that this information is not transparently provided, also as a consequence of varying quality of
national sources, or is sparse across different portals, companies – especially SME's – will
continue having difficulties in accessing crucial information and guidance. Tools such as IMI
and EESSI will lead to improvements in administrative efficiency as regards to the
verification, for example, of contested information on the social security position of a posted
worker or of a company. However, improvements are not foreseen in terms of fastening
delayed replies in the social security coordination area, with consequences on the possible
persistence of inefficiencies. The limited scope of cross-country cooperation on intelligence
and cross-border inspections will have an effect on the persistence of fraudulent forms of
competition, negatively affecting the playing field, especially for cost-sensitive SME's. The
weakness of conciliation procedures in case of disputes between Member States would
continue to discourage this settlement mode, in favour of non-action or unilateral action, with
consequence on the uncertainty for the involved company. In restructuring cases, employers
will continue to rely on dedicated EU resources to buffer the social costs of retraining and
job-search of redundant workers, while soft guidance is provided on a fair management and
anticipation of restructuring processes.
Policy Option 1 (support role) would limitedly improve the information basis for business to
the extent that the Your Europe Portal – in coordination with other EU networks - would
38
promote the tailoring of information provided by national and EU sources to companies’
needs. As today, a SME seeking to understand, for example, the administrative requirements
for posting in another Member State would turn to the Your Europe Portal, which would
collect links to national posting websites while monitoring the accuracy of information from a
business standpoint, also through feedbacks from SOLVIT or the SME feedback device.
Companies would benefit from partial improvements on rule enforcement deriving from a
relatively stronger EU role in the coordination of cross-border inspections and wider mutual
learning programmes to strengthen national administrative capacities, including those in the
road transport sector. While the EU-level’s role would still be limited, some improvements
may be observable for companies in terms of better efficiency of administrations to deal with
problematic cross-border cases and to exert a deterrence effect on fraudulent companies.
Companies will need to turn to national courts for possible disputes with national
administrations. However, the possibility for one Member State to request a third-party expert
opinion in case of administrative dispute may incentivise the use of a EU-level conciliation
mechanism, with benefits for companies involved in such disputes in terms of certainty of
results. Companies would get increased guidance on how to deal with major labour
disruptions drawing on the Quality Framework for Restructuring and on available EU
financial tools, without additional EU level operational intervention.
Policy Option 2 (operational role) would improve the quality and targeting of information
for companies through wider EU-level technical support to national administrations in order
to promote more uniform information standards across the Member States. Companies would
gain the advantage of accessing to similar information standards for example when posting
workers to different countries in Europe. For SME’s, the development potential of the EURES
Portal services would also provide better recruitment opportunities77
. Wider information
exchange between administrations, as well as more thorough mutual learning and technical
assistance programmes would increase national administrative capacities and make them
more effective to deal with cross-border cases involving companies. Particularly in the road
transport sector, the training of enforcement authorities, coupled with a stronger EU
framework for coordinated cross-border inspections would allow smoother control processes
and more guarantees of fight against unfair competition practices.78
A more efficient toolkit
for national administrations to detect and offset fraudulent competitors would be a particular
gain for companies, especially SME’s, with the development of a coordinated and logistical
support structure to joint inspections. In addition, EU-level support may cater for translation
of documents or assist host state administrations in processing documents, thus yielding
possible reductions in the administrative burden for companies undergoing checks and
controls. Faster solutions of inter-state disputes would reduce the uncertainty period of
involved companies, including in restructuring cases. While companies would still need to
77
Almost 90% of registered companies with EURES are SMEs according to employers' registration profile in the EURES
Job Portal in the beginning of January 2018. The highest individual share have micro companies (38 %), followed by
small (31%) and medium ones (19%). [EURES Portal information].
78
Eurofound, Fraudulent contracting of Work: Road Haulage Sector, 2017.
39
turn to national courts for possible disputes with administrations, the conciliation route may
become more effective and quicker in case of disputes between administrations. Companies
with contested PD A1 documents, for example, may benefit from possibly shorter periods of
uncertainty while two administrations verify the necessary documents. EU support in the
facilitation of cross-border labour disruption events would have a direct impact on larger
companies, i.e. those having a cross-border business organisation. However, SME's may also
indirectly benefit from EU facilitation insofar as smaller sub-contractors of affected territories
may receive information about possible EU assistance and participate in multi-stakeholder
collaboration facilitated at EU level.
Policy Option 3 (supervisory role) would entail that information and service standards be
mandatory for Member States to respect, thus ensuring that companies receive the same actual
quality of information for their cross-border activities; physical national contact points would
also provide an additional point of reference for employers in need for concrete assistance in
mobility situations. Companies would also benefit from stricter rule enforcement through
deeper administrative integration in data exchange, EU-led cross-border inspections mandated
by evidence-based indications on suspicious flows and a based on common procedures.
However, the specific arrangements would need to be tailored in order to avoid excessive
information requests and to pursue the objective of quick decisions. The consequent increase
in the deterrence effect vis-à-vis fraudulent companies would contribute to lower levels of
social fraud and a more level playing field. Finally, out-of-court settlement possibilities may
increase the possibilities for administrations to settle disputes between each other, although
individual employers would continue, as in the previous options to rely on instruments such
SOLVIT or adhere to courts in order to settle disputes with national administrations. Finally,
EU-level recommendations on the management of cross-border restructuring events may risk
excessively interfering on the decisions of companies, although affected companies, for
example SME's in the subcontracting chain of larger companies, may benefit from the
mitigating effect of wider EU intervention also supporting their recovery.
6.5.3 Legal impacts
Annex 11 provides a detailed presentation of the legal changes which the different options
would provide. Current on-going initiatives before the co-legislators related to the final
adoption of the revision of the Posting of Workers Directive and of the Regulation on Social
Security Coordination, the Regulation on the Single Digital Gateway and legal acts in road
transport sector would cater for changes already in the baseline scenario.
Overall, Policy Option 1 would entail limited and targeted changes to the legal acts
establishing and regulating different bodies and tools in order to redefine EU's role in relation
to these. Policy Option 2 would imply more extensive revisions for example, to the Social
40
Security Coordination and EURES Regulations. Policy Option 3 would bring the most far-
reaching changes including with a view to ensuring that there is sufficient legal basis for the
code for labour inspections enshrined in the founding act of the new Authority, which implies
a certain level of harmonisation of national rules and procedures.
6.5.4 Budgetary impacts
The impacts on EU budget have been made starting from existing activities currently
managed by the Commission and whose precise cost is known. The sources for redeployment
would be prerogatives (2.6 MEUR) and EaSI (16.5 MEUR). In order to calculate the
additional costs from one option to another, two methodologies have been pursued, depending
on the availability of data. First, some benchmarking exercise has been undertaken with other
similar activities currently existing and implemented by other agencies. As an example, the
cost of the joint inspections has been compared to both EUROJUST and FRONTEX joint
inspections, taking into consideration common features and adjusting to respective
specificities. Second, when no data were available for comparison with existing activity, the
credits have been adjusted comparing the relative scope from one option to another.
The table below shows the results of this analysis at cruising speed. The experience drawn
from the creation of other agencies shows that a five-year phasing in period is necessary for a
body to become fully autonomous and operational. Inspiration was taken from brand new
agencies (EASO (2010-2014 or five years), eu-LISA (2011-2015 or five years), EBA (2011-
2014 or five years)) or major amendments in agencies' mandates (FRONTEX, EASO (2017-
2020 or 4 years)). Hence, cruising speed is expected to be reached in 2023, after a phasing in
pattern 10% - 20% - 60% - 80% 100% from 2019 on. More details are provided in Annex 4.
41
Table 2: Operational expenditures related to tasks assessed to be borne by the EU
budget
Delivering the identified tasks would entail some budgetary impacts, the most significant of
which being under Policy Option 3 both for the EU and for national budgets. This would
mostly be due to additional requirements imposed on national authorities and for new tasks
and services to be provided by the new body.
Policy Option 2 will mainly influence the EU budget with minimum requirements for
national authorities. For example, as regards joint inspections it is assumed that Member
States would be able to cover the related costs by retrieving unpaid taxes or contributions.
Efforts to be made by national authorities to comply with the existing obligations (e.g. for the
timely exchange of information or data collection) are not considered as an additional burden.
The difference between Option 2 and Option 3 is explained by the more ambitious scope of
Option 3 in general and in particular by two new elements which generate significant
additional costs:
1. the creation of a European Inspection Corps assessed at ca. 3,3 MEUR having
FRONTEX as a benchmark under Task No. 3
2. the establishment of a network of single physical national contact points on labour
mobility, for which financial support to IT costs was assessed at ca. 300.000 EUR per
Member State, or ca. 8 MEUR under Task No. 1
42
Policy Option 1 will mainly influence the EU budget, while the impacts on national
authorities would be limited to carrying out joint inspections. It has to be noted that the
additional budget needed on Option 2 compared to Option 1 (750.000 EUR) is marginal in
comparison with the effectiveness, efficiency and coherence gained under Option 2.
6.5.5 Impacts on fundamental rights
The processing of personal data is implied in the tasks relating to information exchange,
cooperation between inspectorates, and risk assessment functions. An adequate protection
standard of personal data is guaranteed across all options through the setting of safeguards,
such as limits to data exchange across borders on social security holder and/or by companies
carrying out activities across borders.
The General Data Protection Regulation and Regulation (EC) 45/200179
would apply to all
tasks provided for by the legislation setting up the Authority during which personal data
would be processed by Member States and by EU institutions; bodies and agencies involved.
In compliance with the General Data Protection Regulation, any processing of personal data
would be limited to what is necessary and proportionate. Data would be collected for
specified, explicit and legitimate purposes and not further processed in a manner that is
incompatible with those purposes.
All three options would build on EU and national data protection legislation without going
beyond the limits set thereby80
, Under Policy Option 1 the Authority's systemising of data and
sharing with Member States and the Commission (Tasks 1 and 3) as well as data originating
from Member States' joint inspections the Authority supports (Task 4) shall be processed in
compliance with EU and national protection laws of natural persons and of commercial
interests. Under Options 2 and 3, the collection of micro-data at the individual level of
companies and/or workers necessary for performing a detailed risk assessment (Task 3) in the
domain of posting of workers shall be carried out in compliance with EU and national
protection laws of natural persons and of commercial interests. The same shall apply to data
originating from Member States' joint inspections the Authority coordinates (Task 4). The
operational measures to that effect shall be established after consultation of the European Data
Protection Supervisor.
6.6. Comparison of the different Policy Options
The comparison of three policy options is done against the core criteria of:
79
Regulation (EC) No 45/2001 of the European Parliament and of the Council of 18 December 2000 on the protection of
individuals with regard to the processing of personal data by the Community institutions and bodies and on the free
movement of such data.
80
To include compliance with Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016
on the protection of natural persons with regard to the processing of personal data and on the free movement of such
data for which the transposition period ends 25 May 2018 - two Member States have currently adopted the national
legislation. A new EU Regulation for the EU Institutions and bodies to comply is in legislative procedure.
43
 effectiveness, i.e. meeting three specific objectives of the initiative (section 4.2),
 efficiency, the extent to which objectives can be achieved for a given cost (cost-
effectiveness),81
 coherence: the coherence and contribution in meeting Union’s objectives and
implementing relevant policy policy initiatives notably in the area of single market,
justice and fundamental rights, transport; migration and home affairs and in the area of
employment and social policy.
The key results are presented in table 3, which includes also summary of benefits and costs
(economic/social impacts) presented in the impact sections.
Table 3: Comparison of Policy Options
Policy Option 1
(Support)
Policy Option 2
(Operational)
Policy Option 3
(Supervisory)
Effectiveness (meeting objectives) 0/+ ++ +++
Improved transparency and access to
information
0/+ ++ +++
Improved operational cooperation 0/+ ++ ++/+++
Mediation in cross-border disputes 0/+ ++ +++
Efficiency 0/+ ++ --
Coherence [including fundamental
rights]
+ ++ ++
Notes: For the purpose of comparing the impacts of options with the baseline scenario, all criteria have equal
weight and a seven-stage qualitative grading scale is used: significant positive impact/gains (+++), medium
(++), small (+), No impact (0), small negative impact/cost (-), medium (--), significant (---)..
For reasons of internal coherence and effectiveness, options are assessed in blocks. Elements
of single tasks are related to one another depending on the different degrees of ambition.
Singling out different elements of each task would unbalance and therefore reduce the overall
coherence of the option and the effectiveness of the overall impact.
Policy Option 2 is the preferred one. It achieves the best balance in meeting objectives,
ensuring benefits (positive impacts) for national authorities, workers and businesses without
significantly increasing costs and has strong support of stakeholders. With respect to the
baseline scenario, delivering the envisaged tasks obviously entails additional costs. However,
these tasks appropriately balance the increased costs with material benefits in terms of
cooperation, information and mediation, thus remaining proportionate to achieve the
objectives. The coordination of the EURES network and the technical support provided to
Member States to fulfil their legal obligation on information provisions remain in line with
existing legislation while providing added value to improve the completeness and quality of
81
The underlying assumption is that the budgetary impacts of governance aspects have same impact across policy options.
44
information to citizens and business. Cooperation is achieved through an integrated approach
across different mobility areas in the direct management of EU tools for administrative
information exchange, logistical support and coordination on joint cross-border inspections,
and strategic design of mutual learning programmes for capacity building. The EU role in
mediation is provided in a more extensive way across all mobility areas yet without going past
current practices. In the event of company restructuring with cross-border implications, the
EU can assume an active facilitating role, if national authorities so request, yet without
interfering with national and companies' decisions. As opposed to Option 3, Option 2
combines expected effectiveness (which is lower in Option 1 but in principle greater under
Option 3) with a proportionate approach, especially in terms of costs (which would double in
Option 3), while also respecting subsidiarity concerns with respect to national competences,
especially in the inspection and conciliation tasks.
Indeed, Option 3 goes in several aspects beyond what is needed in the current context,
especially in activities related to joint inspections and labour mobility services for individuals
and businesses. Also, the possibility to launch inspections on the Authority's own initiative
would limit the scope for national decision. While the idea of European Inspection Corps
could be an useful enhancement of national inspection capacity, it seems disproportionate to
establish such system compared to the size problem identified in the framework of this report.
Similarly, the establishment of single physical national contact points or mandatory standards
and requirements regarding provision of service would give less scope for national decisions
and would be more disruptive to existing well-established arrangments. Conversely, Option 2
leaves sufficient scope for national decision and respects well-established national
arrangements. This is ensured by providing operational support and framework for joint-
activities, but leaving to the discretion of Member States of how and when act.
Policy Option 1 does not contribute sufficiently to overcome the identified problems. Its
constituent elements cater only for limited improvements across the different tasks with
respect to existing actions and programmes, on which it heavily builds. While this option may
be quicker to implement because of the fundamental continuity with the baseline scenario, its
tasks add little value to support cooperation on enforcement and information to
citizens/employers. Operational cooperation remains limited to the scope of the UDW
Platform for capacity building and joint inspections, while completedness of information and
services across all mobility areas cannot be fully ensured by the EURES network. Finally, the
dispute-mediation role is not adequately fulfilled by experts’ opinions, with a low impact on
administrative effectiveness and rule enforcement for citizens and companies.
7. DELIVERY OPTIONS AND THEIR IMPACTS
This section examines different delivery options for the tasks identified in the preferred option
of section 6. They are fully compliant with EU competences and take into account the current
role of EU bodies in the labour mobility and social security domains (see box 1 under 2.2.6),
45
while presenting possible changes. The considered options also comply with the non-
delegation doctrine82
and the EU Common Approach to decentralised agencies83
.
These options respond to the problem identified in section 2.2.6, namely that operational
support at EU level is insufficient to ensure effective cooperation between Member States and
provide information on labour mobility in cross-border situations.
7.1 Delivery options
7.1.1 Baseline scenario
Under the baseline scenario, no new action is taken at EU level to address the shortcomings in
the EU operational capacity in supporting Member States to enforce mobility rules. The UDW
Platform represents the only body entrusted with some potential to facilitate joint inspections
across borders and to offer some capacity building to national administrations. However, its
legal mandate does not provide for a specific coordination role, and its scope remains limited
to undeclared work issues (thus excluding, for instance, operations on most areas of social
security fraud). Labour mobility analysis is coordinated by the Commission, with statistical
and administrative data being treated separately across different labour mobility bodies
depending on their mandate. For example, the AC manages the analysis of data concerning
social security coordination including in connection to posting, as well as data on social
security fraud and error, while cross-border challenges related to undeclared work are
examined in the framework of the UDW Platform. Labour shortages and surpluses
information, with a potential for cross-border matching, are entrusted to the EURES
coordination group, on the basis of PES administrative data collected separately from the
other labour mobility data. The conciliation function is exclusively carried out by the
Conciliation Board within the AC and limited to some aspects of social security coordination.
No comparable forum exists in the other mobility areas.
7.1.2 Delivery Option 1: a European Network is established coordinating existing EU
labour mobility bodies and the Commission takes on new operational tasks
Under Delivery Option 1, the Commission ensures policy coordination across different labour
mobility domains by establishing an EU Network, composed of representatives from the
existing EU bodies in the area of labour mobility and social security coordination. This EU
Network is managed by the Commission. No new dedicated body is created and the existing
EU bodies remain unchanged.
82
Case C-9/56, Meroni & Co v High Authority (13.06.1958).
83
Joint Statement of the European Parliament, the Council of the EU and the Commission on decentralised agencies, 19 July
2012 (Common Approach is of a political character, not a legally binding character).
46
The Network meets periodically so that representatives of the existing EU bodies can share
information on each other's work agenda, discuss mobility aspects of common interest,
coordinate policy strategies and work plan and, possibly, undertake common initiatives across
two or more committees. In this scenario, the Commission assumes a stronger coordinating
and supporting role than is the case today by providing the Network's secretariat. The
Commission puts forward proposals of common work between the bodies, sets the agenda of
the Network's meetings and ensures follow-up of the Network's decisions downstream in the
committees which it chairs. The existing bodies pursue existing activities and meetings and
seek to operationalise decisions taken by the EU network under their own scope of action.
In addition to supporting this newly created Network, the Commission takes on new
operational tasks as described in the preferred policy option 2 (section 6.3) to complement the
work of existing EU bodies.
7.1.3 Delivery Option 2: a new European Labour Authority is established performing
operational tasks, building on existing labour mobility bodies
Under delivery option 2, a European Labour Authority (ELA) is established as a new EU
agency, following the Common Approach on EU decentralised agencies84
. It enjoys
independent legal status and is managed by an Executive Director appointed and a
Management Board comprising representatives from each Member State and two from the
Commission, all with voting rights.
The Authority is not tripartite. This is justified by material and legal considerations. Its focus
will be to support applying the Union law based on Internal Market legal basis (free
movement of workers, posting, and social security coordination). The tasks are operational
and relate to support cooperation between competent authorities in cross-border matters and
to improve access to information and services to the public. It thus will not directly address
aspects such as improvement of working environment or working conditions. The structure is
aligned with the suggested Common approach on agencies too.
Compared to the previous option, in this case ELA performs technical/operational tasks that
are currently not in the mandate of existing labour mobility bodies or poorly delivered and
further develops them within a permanent structure for cooperation. Concretely, ELA
becomes the organisation mandated to execute the tasks listed in the preferred option 2. In
line with the non-delegation doctrine85
, only technical/operational tasks are attributed to the
Authority. All binding decisions remain with the Commission and the Member States, and are
addressed in the context of existing committees and networks, as is the case today.
84
Council general approach, December 2016 (new founding regulation Eurofound confirms a tripartite management structure
deviating from the EU Common Approach.
47
ELA introduces relevant changes to the current landscape of EU bodies in the area of labour
mobility and social security coordination (see box 1 under 2.2.6) by taking over seven
existing functions/bodies, namely: (i) the EURES European Coordination Office, in order to
deliver the task of coordinating information, guidance and assistance services to individuals
and businesses facilitating the exercise of the right to work in another EU country; (ii) the
Conciliation Board from the AC, with a view on extending its scope beyond social security
coordination matters to all labour mobility areas, as well as the (iii) Audit Board and the (iv)
Technical Commission of the AC, due to their operational nature; (v) the European Platform
to tackle Undeclared Work with a view to streamlining operational activities, notably on
capacity-building, analysis and joint inspections; (vi) the Expert committee on the Posting of
Workers; and (vii) the Technical Committee on the Free Movement of Workers, on the
grounds of their technical nature (exchange of information between public authorities). The
tasks currently performed by these bodies would be carried out by the Authority.
In addition, a Stakeholder Group with advisory functions is created within the Authority
which convenes representatives of the social partners with the objective to submit opinions
and advices on all the issues of competence of the Authority.
In addition, ELA would develop cooperation with the three remaining committees in the
labour mobility and social security coordination field, which have a more policy steering role,
namely the Administrative Commission and its Advisory Committee, and the Advisory
Committee on the Free Movement of Workers. These remain and will not change with the
creation of ELA. ELA liaises with them as with other decentralised agencies (in the
employment field, as well as with others such as Europol) as necessary to ensure
complementary of work. Likewise, the comitology Committee on Road Transport would not
be affected, as it has no operational or technical competences that could be taken over, shared
or duplicated by ELA.
7.1.4 Delivery Option 3: a new European Labour Authority is established building on
an existing EU Agency in the area of employment
Under delivery option 3, a European Labour Authority is established through a merger with
one of the existing EU agencies in the field of employment. Agencies to be considered for
such a merger are Eurofound, Cedefop and EU-OSHA. The ETF, because of its third-country
focus, is not deemed as a suitable basis for ELA’s tasks and objectives.
The "host" agency changes its mandate to incorporate the new operational tasks of the
European Labour Authority (as outlined in the preferred policy option 2, section 6.3), while
continuing to deliver on its existing tasks.
The mandate of the European Labour Authority remains as presented in delivery option 2
(section 7.1.3).
48
Stakeholders' views on the possible organization of a European Labour Authority
The input to the stakeholders' consultation did not present any concrete option on the
organization of ELA. Therefore, the replies do not directly address the above-mentioned
options. However, they provide important indications (see Annex 2 for more details).
Overall, stakeholders tend to agree on the fact that no organisational structure can be
determined if the scope and objectives of the Authority are not clearly defined as this would
risk resulting in increased administrative complexity. Moreover, there is a general consensus
on the fact that the new Authority should have a role in stimulating exchange of information
and operational cross-border action through coordinating the work of Member State bodies
and existing EU-level bodies or mechanisms dealing with cross-border mobility. Some
stakeholders proposed a strong governance structure for the ELA to the extent that is possible
in respect of the principle of subsidiarity (ECPW: ES, FR, IT, RO members; ETUC; civil
society organisations). For instance, the ECPW and ETUC argued that representatives from
the competent Member State authorities as well as social partners should hold key positions in
the governance of the ELA.
Many stakeholders suggested the need to improve the coordination of existing EU labour
mobility bodies and of national authorities at the same time. It was stressed that overlaps and
duplication of effort should be avoided. The overall EMCO position was that the ELA should
build on existing bodies and tools so that no additional reporting requirements or costs are
passed on to the Member States, with the Finnish member adding that the ELA could exist as
a supporting network and not a physical agency. EPSCO and the PES Network shared the
view that, absent clarification of ELA's concrete tasks, ELA could be envisaged as a network
focused on solving concrete problems. Oher stakeholders argued that the ELA should have a
supportive rather than an authoritative role so as to safeguard the competencies of Member
State authorities (UDW; SLIC; ECPW: LV, PL, PT, SE members; MISSOC CZ and LV
members; FMW SE member; PEARLE; REIF, Nordic-Baltic-Polish EU Information Group).
Finally, a number of stakeholders supported stronger cooperation between existing EU bodies
to address cross-border challenges without increasing their capacity or changing the way they
are governed. Respect of subsidiarity is key to this position, with a considerable number of
EMCO members (CZ, HU, IT, LU, NL, SE) emphasising the need not to transfer regulatory
or legal competencies away from Member State authorities and to first assess the performance
and objectives of current EU instruments. Similarly, many members within the AC (BE, CZ,
DE, HU, LT, LV, NL, PL) and the PES Network (BE, CZ, DE, FI, HR, IE, SE, UK) argued
against the risks of complexity and duplication. Synergies between existing organisations and
national labour inspectorates could be enhanced, in their opinion, without establishing a
dedicated body. The same view was shared by Business Europe, the Estonian ECPW member
and the Czech MISSOC member.
49
7.2 Impacts of different delivery options
This section analyses the impacts of the delivery options from the point of view of the
effectiveness in delivering the six tasks as defined in the preferred policy option 2 (section
6.3). It also assesses their legal and budgetary impacts.
7.2.1. Effectiveness
An assessment on effectiveness examines the extent to which the different options address the
problem of the insufficient EU operational capacity (section 2.4.6), support the delivery of the
tasks envisaged for a European Labour Authority as set out in policy option 2 (section 6.3),
and ultimately contribute to meeting the stated objectives of such an authority (section 4).
In the baseline scenario, where no new action is taken to strengthen EU operational capacity
in the field of labour mobility, the current mandates and resources of the EU bodies and the
Commission do not create the conditions to appropriately deliver on the envisaged tasks.
Improvements on exploiting synergies between different labour mobility and social security
areas can only be delivered through the competent EU bodies, albeit limited to their area of
specific competence. Existing Commission’s human and material resources are in themselves
not sufficient to support the new operational tasks defined under the preferred option 2, for
example on joint inspections and capacity-building on a wide scale. Today the Commission
coordinates or directly delivers regular reports and provides data analysis on various aspects
of labour mobility, also in cooperation with Eurofound, the AC and the UDW Platform in
their respective domains of competence. However, it would require additional resources and a
clear research re-orientation to provide more integrated and in-depth assessments of specific
enforcement measures or reports feeding into possible joint inspections or capacity-building
programmes all across the mobility spectrum. Finally, it is not possible to deliver wider and
more effective conciliation mechanisms under the current framework, which would remain
limited to the social security coordination area and its AC.
Delivery Option 1 (a European Network coordinating existing EU labour mobility
bodies is established and the Commission takes on new operational tasks) would yield
some improvements in delivering the tasks in a coordinated way. On one side, the set-up of a
Network to coordinate across different bodies would improve policy cooperation on cross-
cutting issues, for example between the UDW Platform and the AC on letterbox companies,
thus promoting an integrated approach to rule enforcement and a strategic steer to operational
tasks. However, this option would bear two considerable disadvantages. First, it would create
an additional layer of EU-level governance without significantly augmenting the operational
capacity at national level. The EU Network would promote a common agenda, but the various
bodies would still have different competences to concretely deliver. The most significant
example is that of conciliation, whereby administrative disputes would remain solvable
exclusively in the social security coordination area. Second, the Commission would assume a
wider range of tasks, including feeding in the coordination of the EU Network and carrying
50
out operational tasks on its own, such as supporting inspections. Additional staff would need
to be recruited. While the Commission's role would be suitably deployed in providing policy
steer to the EU Network, the Commission would not be best placed to carry out operational
tasks as those require specialised staff, proximity on the ground, and national powers. To sum
up, while this option would help addressing policy coordination issues with an integrated
policy steer, both the different competences of EU bodies and the ill placement of the
Commission to carry out operational actions on the ground would reduce the effectiveness of
delivering on the envisaged tasks.
Delivery Option 2 (creation of new European Labour Authority building on EU labour
mobility bodies) would clearly assign a new operational role to the Authority in order to
complement and, in many instances replace existing EU-level bodies, which are currently ill-
equipped for the tasks required. By incorporating those bodies with technical and/or
operational functions86
, the Authority would promote a strong streamlining of the existing
institutional landscape and taking up their functions to carry them out in a more integrated
way. The Authority would improve the current provision of labour mobility analysis, by
pooling relevant sources, with the advantages to eliminate possible duplications, to develop
further the EU-level intelligence capacities and to creating synergies with other more
operational tasks. The Authority would have a more solid starting position for supporting joint
inspections thanks to specialised and dedicated staff, building on and reinforcing the current
mandate and operational resources of the UDW Platform, which would be absorbed into the
Authority. Finally, the presence of National Liaison Officers would constitute an important
coordination mechanism in facilitating bilateral or multilateral information exchanges
requiring the involvement of a plurality of competent authorities – e.g. labour inspectors,
social security institutions - in the Member States concerned.
By way of example, the phenomenon of letterbox companies would be addressed in one
forum in an integrated manner, rather than by the UDW Platform, the ECPW and possibly by
the AC under different angles. Upon prior decision by the Management Board to undertake
work on letterbox companies as a priority, for example, the Authority may deploy its
analytical capacity to examine various policy challenges and possible responses in the fields
of labour law and social security; examine the information exchange tools in order to assess
their adequacy to provide relevant information; provide targeted training to national
competent authorities on how to detect and to address fraudulent cases, and, upon request by
Member States, coordinate concerted or joint inspections on concrete cases also on the basis
of the collected expertise.
86
See section 7.1.3 - Namely, the EURES European Coordination Office, the UDW Platform, the Conciliation
and Audit Boards as well as the Technical Commission of the AC, the Technical Committee on the Free
Movement of Workers and the Expert Committee on the Posting of Workers.
51
In the case of the AC, the absorption of the Conciliation Board would allow to extend the
conciliation function to other mobility areas on a permanent basis, thus also extending the
range of expertise needed for opinions and fastening the procedures. The AC Audit Board and
Technical Commission would be absorbed on the grounds of the technical nature of their
tasks, respectively in overviewing and facilitating cross-border payments settlement of
reimbursement claims between social security institutions, for example related to the use of
the European Health Insurance Card, and in providing a forum to discuss technical aspects of
the IT tools used in social security coordination, notably for the exchange of information (i.e.
EESSI).
Effectiveness would also improve in reaching out to individuals and employers by tapping on
clear economies of scale. Through the coordination of EURES, there could be more synergies
between its common training programme, analyses and communication activities with similar
activities carried out by other bodies. This would in particular benefit the preparation of
activities for bodies which are tasked to provide other forms of information and advice to
individuals and businesses, such as bodies responsible for the enforcement of posting of
workers and the free movement of workers. Joint capacity building and training measures
could be initiated and outreach activities to workers and employers could be expanded to
cover a broader range of topics and/or a wider audience.
The Authority would interact with the remaining bodies, namely the AC and its Advisory
Committee, the Advisory Committee on the Free Movement of Workers, and the comitology
Committee on Road Transport providing preparatory input for their policy steering and
decision making roles as necessary. These committees, together with the Stakeholder Group
would also constitute the key fora for exchange with the social partners on labour mobility
policy issues. The Stakeholder Group would provide a permanent EU-level forum for
discussion and advice on operational matters between the Authority and the social partners
embracing all labour mobility areas in an integrated way, thus also compensating for the
integrated role of the social partners in the UDW Platform.
Concretely, by absorbing the Audit Board and the Technical Commission, the Authority will
support the Administrative Commission decisions linked to financial and technical matters
related to the application of social security coordination rules.
For example, on the financial side, the Authority would support the AC as follows:
- gather information from Member States regarding the statements of their annual
accounts and prepare yearly reports on it;
- verify the method of calculating average costs by Member States to be used as a basis
for reimbursements of healthcare costs of persons receiving such benefits in cross-
border situations,
- facilitate the final closing of accounts in cases of disputes between Member States
about reimbursement claims.
52
On the technical side, the Authority would support the AC on questions on electronic data
exchange and data processing as follows:
- organise a forum to bring together national IT experts for matters related to the EESSI
system and play a key role in the governance of this IT solution,
- provide a source of expertise and prepare reports and studies to support decisions on
the future evolution of the IT tools in place, or ensuring preparatory work for new
initiatives,
- supporting and promoting the use of IT tools by Member States, and explore ways in
which a further digitalisation of procedures can be achieved.
The Authority would also support and feed into the work of the Administrative Commission
in other areas (beyond financial and technical aspects), by providing analytical work and
reporting, including support and streamlining of the statistical data collection and analysis
under the framework of the Administrative Commission, for example by the further
development of questionnaires in use and by preparing analytical reports based on data
collected. Wherever needed for reporting purposes, a representative of the Authority would be
invited to the meetings of the Administrative Commission.
The Advisory Committee for the Coordination of Social Security Systems and the Advisory
Committee on the Free Movement of Workers would continue their work as they do today.
Likewise, the Committee on Road Transport would continue its ordinary work as part of the
EU comitology structure. However, the future Authority may feed into discussions within
these fora for example, by presenting the findings of reports prepared by the Authority which
are relevant to the scope of those committees.
Delivery Option 3 (a Labour Authority building on an existing agency) would build on
the previous option 2 and at the same time proceed with the integration of the new Authority
with an existing agency. This two-step-at-once approach would add up on the advantages of
option 2 while seeking synergies with the expertise and management of an existing agency.
However, building on an existing decentralised agency would pose a number of challenges
(see also Box 1 in section 2.2.6 and Annex 13). First, none of the existing EU agencies has a
cross-border specialisation, except for the ETF which, however, has a focus on the third
countries of the EU neighbourhood. Moreover, labour mobility issues fall outside the scope of
expertise of most agencies, with the partial exception of Eurofound. In the short-term, at least,
the effectiveness of the new Authority would be low due to a necessary integration and
leaning process. Second, while the tasks envisaged for this initiative have a strong operational
nature, the existing agencies are more research-centred. While the ETF has an operational
character, its focus on third-country ill fits with an Authority set to work on the EU. There
could be some scope for integrating the risk assessment function, for instance with Eurofound
or EU-OSHA. Nevertheless, this task has a broader ambition under the present initiative than
it is currently carried out in the decentralised agencies, as risk assessment also entails the
analysis of administrative data. Finally, from a governance viewpoint, existing agencies have
53
a tripartite structure which is not deemed the ideal arrangement for the new Authority, which
has a strong operational mandate. The reform of the governance structure may reveal itself
problematic.
This notwithstanding, the finalisation of the evaluation process of the existing Agencies may
provide some input to further explore the potential of synergies and streamlining between
each of the existing Agencies and the new labour Authority, with a view to possible political
decisions in the longer term. By way of example, there may be scope for streamlining a
number of logistical and managerial arrangements across the agencies, including the support
services (e.g. by locating the ICT and the Brussels Liaison Offices in one place), the joint
procurement of ICT and audio-visual equipment and services, cloud services, and putting in
place common systems in the area of performance management, monitoring and evaluation.
At the same time, as the new Authority will tap on existing research resources developed by
the existing agencies in their respective competence area, this could lead to pooling of
resources or production of joint reports on issues of common concern, for example
restructuring or the respect of occupational health and safety rules in mobility situations,
including posting, in the context of the risk assessment task.
7.2.2. Legal impacts
While the baseline scenario would not require any legislative change, the other delivery
options, most notably Delivery Option 2 and Option 3 with the establishment of the
European Labour Authority would require revisiting a number of EU legal acts in the areas of
labour mobility and coordination of social security (a detailed inventory is included in Annex
11). Delivery Option 3 would require additional legislative revision in order to amend the
Regulation establishing the Agency on which ELA would be built.
Delivery Option 1 would entail formalising the European Network, which could be achieved
by a legal act such as a Decision of the Commission. This approach would not impact on
legislation establishing the currently active committees and structures at EU level.
Delivery Option 2 would bring about streamlining of a number of existing committees and
structures by incorporating the operational tasks of these in a new European Labour
Authority. The establishment of the Authority would be done by a Regulation, and several
Union acts would need to be amended or repealed in the process (as set out in Annex 11) in
order to achieve that it delivers on the tasks identified in the preferred Policy Option in
section 6:
 taking over the management of the EURES European Coordination Office, currently
ensured by the Commission (amendment of Regulation (EU) No 589/2016
establishing it);
 replacing the Technical Committee on the Free Movement of Workers (amendment of
Regulation (EU) No 492/2011);
54
 replacing the Committee of Experts on Posting of Workers (repeal of Decision
2009/17/EC);
 replacing the Technical Commission, the Audit Board, and take over the conciliation
function of the Administrative Commission for the Coordination of Social Security
Systems (AC) (amendment of Regulations (EC) No 883/2004 and 987/2009);
 replacing the European Platform on tackling undeclared work (repeal of Decision
(EU) 2016/344.).
Delivery Option 3 would have similar legal impacts as Delivery Option 2, with the key
difference that instead of a new Regulation needed to set up the Authority, one of the existing
Agency’s founding Regulations would need to be amended.
7.2.3. Budgetary impacts
This section presents the budgetary impact of the different delivery options proposed. It does
so by assuming that the new entity carries out the tasks as defined in preferred Option 2 on
tasks (see section 6).
The baseline scenario is presented as regards the costs of existing running EU bodies in the
field of labour mobility. Logistic and reimbursements for expert meetings absorb the lion’s
part of budgetary costs of existing EU bodies. These costs are particularly high for the
Administrative Commission, although they are motivated by the large number of participants
with respect to other bodies and by the frequent number of meetings, in different formations,
on a yearly basis. Bodies such as the ECPW and the technical and advisory committees on
FMW meet on a more sporadic basis, and this justifies lower running costs and less
Commission staff assisting them.
Delivery Option 1 would not change the related running costs for the existing EU bodies that
would be the same as in baseline. However, additional costs would ensue for the meetings of
the new EU Network, including reimbursements for meetings, logistics etc. At least two
meetings a year should be envisaged, thereby increasing the costs and the administrative
burden accordingly. It is likely that the number of participants in meetings would increase, as
each group would send a representative in other groups' meetings. In turn, this option would
entail that a dedicated group of Commission officials is employed full time in the new
Network's secretariat. The costs of such a secretariat are assessed as being similar to those of
PES or EURES support network or ca. EUR 2 million per year.
In addition, the additional operational costs that would be incurred to carry out the new tasks
would be incurred in that case by the Commission. Also, it would need to recruit additional
staff and acquire related space and equipment, to run those additional tasks, just like the
agency would do. These costs would range around EUR 13 million.
55
Delivery Option 2 would entail budgetary costs related to ELA administration (recruitment
of new staff, rental of premises - unless the host country would provide for it -, furniture and
IT costs), on top of the operational costs mentioned in section 6.1.4 under the preferred
option, i.e. the operational one. The extra costs for title 1 and title 2 would range around 22-24
MEUR (see table below), but would serve all other parameters taken into consideration for
comparison: effectiveness, efficiency, coherence and long-term impact.
Delivery Option 3 would likely result in a few savings due to some unique functions being
not repeated (Executive Director, accountant, Head of HR department). The immediate
benefit is clearly that the agency would become operational more quickly. But as the agency
will grow gradually, the administrative services will have to grow proportionally to face the
inevitably increasing workload. In terms of governance, it would completely destabilise our
existing agencies, considering their budget is about half the size of the future one and their
current staffing at best equivalent. Their field of competence is also quite different, being
rather research-oriented, which means that there would be very little synergies in terms of
staffing profile as well. Owing to the tripartite nature of our existing agencies, dedicated
governance would need to be set up within the agency, which would increase the
administrative burden and thus decrease the efficiency. Also, in the medium term, the cost of
enlarging the premises to accommodate the necessary extra staff would not necessarily result
in savings as compared to renting new premises.
As a result it is expected that the running costs of the agency under this governance option
would be marginally reduced compared to option 2, yet still within the range of 22-24 MEUR,
on top of the operational costs mentioned in section 6.1.4 under the preferred option, i.e. the
operational one. These marginal gains would need to be weighed against all other criteria of
effectiveness, efficiency, coherence and long-term impact.
56
Table 4. Comparison of costs by delivery option
7.4. Comparison of Delivery Options
The delivery options are assessed against the core criteria of effectiveness (section 4.2),
efficiency (cost-effectiveness) and coherence (the coherence and contribution in meeting
Union’s objectives in the area of employment and social policy and in relation to general
policy Union's budgetary and organisational objectives ). The key results of the comparison
are presented in table 5.
57
Table 5: Comparison of Delivery Options
Delivery Option 1
(European
Network)
Delivery Option 2
(New Agency
building on
existing bodies)
Delivery Option 3
(ELA builds on
Agency)
Effectiveness (meeting
objectives)
+ +++ +++
Transparency and access to
information
+ +++ +++
Improved operational
cooperation
+ +++ +++
Mediation between
Member States
0 +++ +++
Efficiency 0 ++ +
Coherence + +++ +
Notes: For the purpose of comparing a seven-stage qualitative grading scale is used: significant positive
impact/gains (+++), medium (++), small (+), No impact (0), small negative impact/cost (-), medium (--),
significant (---).
The comparison of options shows clearly that Delivery Option 1 cannot be considered as
preferred one. Although there is some merit in considering the advantages of stronger policy
coordination between EU-level bodies and of entrusting the Commission to carry out
operational tasks, the positive impact would be relatively small. An additional governance
layer would be created. The Commission would need additional staff and specific skills which
its new role would require. In addition, carrying out operational tasks may imply the risk of
driving the Commission astray from its key policy-making role. On top of it, further resources
would need to be dedicated to providing an appropriate secretariat to the EU network,
preparing its meetings and ensuring adequate follow up. Finally, the staff involved could not
deliver on operational tasks requiring constant work on the ground in an effective way,
especially on support to joint inspections between the Member States.
Delivery Option 2 has the same degree of effectiveness in delivering the task as Option 3,
since the latter builds on the former. However, Option 2 scores higher in terms of efficiency
and coherence than Option 3. Both criteria have to do with the long-term impact of a possible
integration between the Authority and an existing agency. Both options would require
additional resources with respect to the baseline scenario and to Option 1. Therefore, they
may appear less coherent with the Union's budgetary and organisational objectives, including
that of progressive staff reductions in all EU bodies. However, new resources would be
matched by the delivery of new tasks that are poorly done or that are not carried out at all
under the current set-up.
58
In the short term, there might be a small advantage for the Delivery Option 3 compared to
Option 2 in terms of costs, as the new Authority would use existing infrastructures and
administrative capacities. However, the new Authority would be considerably larger than
existing small or medium-sized agencies87
. This would imply an overhaul of human
resources, with the further risks of greater management complexity and of downplaying the
policy objective of the selected existing agency vis-à-vis the operational needs of the new
Authority. Given the size of the bigger Agency, additional administrative and infrastructure
sources would be needed, as well as additional staff to carry out operational tasks requiring
specific expertise. The challenges in bringing together two structures with rather different
modus operandi (e.g. research vs operational support, management of different stakeholders,
role of the ELA in supporting co-operation in road transport) and governance structures would
make the ELA be operational (in terms of delivering its tasks) faster in Option 2 rather than in
Option 3. Another specific problem with Option 3 would be represented by the tripartite
governance structure of all existing employment agencies which may be ill-suited to the faster
responsiveness and operational flexibility required for the new Authority. As a result, it could
be concluded that while there could be a potential for building the new Authority on top of an
existing agency, the complementarities would not be immediate.
Taking this all into account, the preferred Option is Delivery Option 2. Option 2 scores best
also in terms of proportionality. The problems that the initiative aims to address are related to
poor cooperation, information and fragmentation in the area of labour mobility bodies. While
Option 1 doesn’t go far enough, the Option 3 goes beyond what is necessary. Option 3
involves an entirely different reform agenda – the one on the restructuring of agencies – into
the mobility agenda. It seems disproportionate to restructure the Agencies only with a view on
solving problems regarding labour mobility. In addition, although the initiative creates a
financial cost for the Union and national governments, they are minimised and commensurate
with the objective to be achieved. Overall, Option 2 would combine effectiveness in carrying
out the tasks with the provision of an adequate operational structure at EU level to perform
the needed tasks in an integrated way, while achieving efficiency gains across neighbouring
mobility domains by rationalising existing bodies. Implementing this option would require
more far-reaching institutional changes, which would be accompanied by some degree of
resource optimisation.
8. PREFERRED POLICY AND DELIVERY OPTION
8.1 Policy Option 2 (Operational Option), and Delivery Option 2 (New European
Labour Authority building on existing EU bodies)
The preferred option is the establishment of a European Labour Authority with operational
role (Policy Option 2) building on EU bodies in the area of labour mobility (Delivery Option
87
The staff of existing agencies ranges between 40 and 90 establishment posts and budgets up to EUR 20 million. The new
Authority would require a staff 113 posts and a budget of around EUR 50 million (see section 7.2).
59
2).88
This new Authority will also develop enhanced cooperation with existing agencies in the
employment area ensuring complementarities and adapting to their future evolution.
The ‘operational’ Option 2 envisages pro-active support to information and services to
citizens and employers, cooperation, joint inspections, analysis and risk assessment,
information exchange, and capacity building, while facilitating the adoption of decisions as
regards conciliation mechanisms and cooperation in case of cross-border labour disruptions.
Such mechanisms are extended to all core labour mobility areas including the road transport
sector in line with the institutional framework in these fields.
The combined preferred option achieves the best balance in meeting objectives, ensuring
benefits (positive impacts) for national authorities, workers and businesses while the costs are
commensurate with the objectives. It is respecting well the proportionality and subsidiarity
principle as it leaves sufficient scope for national decision, and respects well-established
national arrangements. This is ensured by the new body providing operational support and
framework for joint-activities, but leaving to the discretion of Member States of how and
when they use it, and with its focus on cross-border labour mobility issues where Member
States alone cannot achieve objectives satisfactoriliy as it was demonstrated in the problem
section.89
The preferred option combines effectiveness in delivering operational tasks by
complementing but also rationalising the current set-up of bodies on labour mobility and
social security coordination, thus addressing two important concerns raised by relevant
stakeholders.
The preference for Option 2 does not rule out future decisions to build the new Authority on
an existing decentralised Agency (as presented in Option 3). However, such decision needs to
be informed by the completion of the evaluation process of these agencies which will provide
some input to the possible synergies and risks of building the Labour Authority on one of the
existing Agencies.
The benefits for individuals, especially the mobile workers, will be better protection and
reduced exposure to the risk of fraud and abuse, especially in the road transport sector.
improved legal clarity and predictability of procedures. Further benefits arrive from improved
possibilities to exercise their rights to the freedom of movement.
Business, especially SMEs, will benefit from more fair competition and equal playing field
and from reduced uncertainty about their situation, especially relevant in relation to posting of
workers. That together with better information can facilitate their decisions to engage in
cross-border activities, including recruitment.
88
Explanation on the selection of preferred option was provided earlier and is not repeated here. Please, see the relevant
section (section 7.2.for Policy Option) and section 8.3 (for Governance).
89
See also section 2, and 7.2. .
60
Benefits for national authorities are their reinforced cooperation and control capacities for
better rule enforcement. Benefits of structured cooperation are expected to increase over the
time as more national authorities decide to use the new operational capacity.
The wider macro-economic benefits of the initiative is improved labour market functioning
and improved prospects for individuals and companies to expand their cross-border activities
with positive impacts for productivity, employment and GPD.
At cruising speed, the sum of the costs relating to Title 1 (Staff) and Title 2 (Infrastructure
and operating costs) would range from EUR 22 to 24 million per year, depending on the
category of staff hired (temporary agents, contract agents, external providers) and the
premises chosen (number of meeting rooms, security features, potential share of costs with
other tenants for the reception, etc.). In terms of staff costs and other administrative expenses
(building, movable property, telecommunications, etc.),90
the seat of the agency will be a
determining factor. As the seat is not known at this stage, the costs have been calculated on
the assumption that the agency would be Brussels-based (no correction coefficient applied to
salaries and real estate market based on Commission's buildings).
The assessed salary costs under Title 1 comprise the Establishment Posts as presented below
(69 posts at cruising speed) as well as 60 Seconded National Experts and 15 contract agents.
Other administrative expenses under Title 2 were assessed based on the benchmarking with
decentralised agencies that have similarly operational nature of tasks (e.g. Frontex, EFCA)
and are of a similar size (ca. 100 staff (see Annex 10 for more details). As building costs are a
significant part of Title 2, comparison has been made with agencies whose staff numbers are
similar, i.e. GSA, ERA, EBA, ESMA and eu-LISA and an average price has been calculated
on the basis of their annual (rental) costs. Detailed explanations per item for Title 1 and Title
2 are available in Annex 4. The number of staff has been made with a view to ensure a
proportionate balance between operational activities and administrative support.
Table 6: Staff needed for ELA (Policy Option 2 "Operational Option")
Start-up phase cruising speed
2019 2020 2021 2022 2023
Cumulative EP posts 16 33 50 69 69
The cooperation of ELA with other agencies is expected to have minor financial and staff
impacts to ensure coordination based on the available practice from existing agencies, such as
the network of DG HOME agencies (EUROPOL, CEPOL, FRONTEX, eu-LISA, EASO and
EMCDDA). The costs are rather linked to mission costs. All these agencies are well equipped
90
Typically foreseen under the Title 2 of a decentralised agency.
61
with videoconference material which allows for having efficient communication within the
network.
8.2 REFIT (simplification and improved efficiency)
The proposal to establish ELA will transform EU institutional landscape in the area of cross-
border mobility. By reorganising the existing activities and processes the foreseen changes in
term of simplification and streamlining will allow to deliver more and better quality results
compared to today, when committees work in parallel and in silos. The impacts are not
quantified because it was not possible to gather the needed data within the time constraints
under which the initiative was prepared. Key direct impacts will be felt by national competent
authorities, but the revised system will be beneficial also for individuals and companies.
The expected key simplifications and improvements for national authorities are savings
in terms of time and resources in exchanging information, coordinating activities and in
providing information. The Authority will not only facilitate the identification of relevant
counterparts in other Member States, but would also ensure that information is exchanged in
time and is complete. This would reduce the need to conclude bilateral and multilateral
agreements that are currently needed in the area of posting. Model agreements and
coordination meetings for joint inspections - which are currently not available, notably in
carrying out concerted checks in road transport - would reduce organisation and coordination
efforts of Member States. Revamped conciliation mechanism (shorter decision making cycle
deadlines; enhanced support, including translations) would improve the possibilities for
national authorities to solve their disputes in the area of social security coordination faster
than before, and provide an opportunity to solve disputes also in other areas.
Reorganisation of the existing committees will lead to simplification. Seven existing EU
bodies will be replaced by ELA that will streamline and integrate the technical and
operational tasks of the existing EU bodies into a permanent framework (see section 7.1.3),
while the EU bodies with policy-shaping and legal tasks powers will stay in place. This
change would simplify the institutional set-up as there would be a clear division of tasks
(technical/operational vs policy shaping), thereby making communication and interaction
easier, but also allowing the bodies to focus on their key tasks. E.g. integrating the
conciliation function of the AC in the Authority would allow this committee to focus on its
key role of discussing legal matters of implementation and further development of the social
security coordination rules.
The establishment of the Authority would create potential for streamlining and
improving efficiency due to the pooling of resources and of operational tasks. There is a
streamlining potential from coordinating tasks in relation to training and capacity building
activities currently undertaken by different EU bodies. Training curriculum can be enriched to
take into account broader range of cross-cutting aspects and it can be more easily offered to a
broader and more diversified group of participants. This helps to bring economies of scale in
62
relation to developing training curriculum and encourage creation of new ones. As an
example, the Authority could ensure that the mutual learning activities on undeclared work in
the context of the UDW Platform would become more accessible to others or could more
easily move away from the current focus on undeclared work only to other areas.
In addition, the Authority will create synergies and thereby improve the quality of discussions
and policy outcomes. For instance, even if the fight against letterbox companies was on the
agenda of the UDW Platform, it couldn’t act actively against it due to the lack of operational
instruments91
and because of the separation of tools for exchanging information. This would
be now possible with the Authority bringing tasks together under one operational body.
The Authority as an agency would be able to benefit from sharing services with other
decentralised Agencies joined in the inter-agency network. The network provides a catalogue
of almost 900 shared services available to members of the network (e.g. in the IT, HR,
procurement).92
Authority will be organising quite a number of various events (e.g. trainings,
mutual learning events, operational meetings to support joint inspection or dispute
settlements). This would allow it to achieve economies of scale in logistic or support services
(e.g. lower prices for renting meeting rooms, reducing reimbursement costs by providing all-
inclusive packages93
). In anticipating the number of events, the Agencies’ infrastructural
resources could be selected to cater for this (i.e. availability of own meeting rooms to avoid
renting).
The Authority activities will ensure complementarities and avoid overlaps with the
information tools/policies and problems-solving services for individuals and employers (e.g.
Single Digital Gateway; SOLVIT, Your Europe, Your Europe Advice, Enterprise Europe
Network). ELA will complement them, contribute to their improved use, but also benefit from
them. This will be done by Authority managing the EURES, which is included in SDG. The
Authority assistance would help integrate sector-specific guidance, for example on posting or
road transport. Further to that, the Authority will provide technical support to Member State
to facilitate their compliance with relevant obligations laid down in the proposal on Single
Digital Gateway, notably on the quality of the information provided. This support will
streamline national efforts and help national authorities to work in more focused way. Finally,
the Authority will use information gathered via Your Europe Advice, Solvit or Enterprise
Europe Network to inform its capacity building activities and training for national
administration staff to ensure, that they convey relevant and up-to date information to
individuals and employers.
92
The evaluation of four agencies shows in general positive experience of agencies in using those services, e.g. in IT.
93
The evaluation of four EMPL agencies showed that Eurofound was able to cut the overall event costs by €72,000 by
opting-in for “all-inclusive” policy meaning that each delegate was entitled to an economy flight, hotel accommodation and
catering (the latter two items in line with the ceiling in place for Ireland).
63
The Authority will improve situation for individuals and companies, including SMEs, to
undertake cross-border action. The initiative improves the transparency, information and
services provided to the public about rights, obligations and opportunities related to cross-
border labour mobility, thus simplifying access to such information and services for
individuals and companies. The Authority support in catering for translations of documents
and assisting host state administrations in processing documents could reduce the employers
burden related to that.
The Authority will coordinate closely with the four existing agencies in the employment area,
notwithstanding possible decisions on future streamlining of agencies. On analytical tasks of
common concern, as well as on complementary aspects to labour mobility rules, such as skills
or occupational health and safety, the Authority is set to exchange information and possibly
program joint work with the other competent agencies.
9. HOW WILL ACTUAL IMPACTS BE MONITORED AND EVALUATED?
9.1. Monitoring
With the new body changing the institutional set-up of the Union, its functions will have to be
closely assessed and possibly adapted to the situation on the ground. Providing for a robust
monitoring and evaluation mechanism is therefore crucial to ensure that the envisaged
beneficial effects of the Regulation materialise in practice.
The following monitoring framework would inform on progress towards achieving the
objectives of the Regulation and will be subject to further adjustment according to the final
legal and implementation requirements and timeline. To avoid putting additional
administrative burden due to the collection of data or information for the purpose of
monitoring, the proposed monitoring framework rely as far as possible on established data
sources, especially the Annual Activity Report of the new body. The below table provides an
overview of the operational objectives of the Regulation and their corresponding monitoring
indicators. Being a horizontal objective, progress in meeting the objective of streamlining and
rationalisation will be assessed in the context of the evaluation, in particular when assessing
efficiency.
64
Table 7. Indicators on progress towards objectives
Specific objectives Operational objectives Indicators Source of data
Improving access to
information and
services for individuals
and employers
To enhance
comprehensiveness and
quality of labour mobility
service
Stakeholders’ satisfaction with the
clarity and completeness of the
information on rights and obligations
in the area of cross-border labour
mobility
Share of vacancies posted on EURES
as a proportion of national vacancies
Number of persons who found a job
in another country with the help of a
EURES
Annual Activity Report (new
available with the
establishment of the
Authority)
Single market scoreboard
(existing)
Eures statistics (existing)
Single Digital Gateway (user
feedback and statistics) (in
development)
Strengthening
operational cooperation
between authorities
To enhance effectiveness
and efficiency of
information exchange
between national authorities
Share of information exchanged
within deadlines
Stakeholders' opinion on
administrative burden related to
information exchange
Annual Activity Report (new
available with the
establishment of the
Authority)
Single Market Scoreboard
(existing)
Stakeholders feedback (new)
To provide relevant
analytical and technical
support to national
authorities for cross-border
co-operation
(Level of) Stakeholders' satisfaction
with the timeliness and completeness
of monitoring and statistical data
Stakeholders' satisfaction with the
mutual learning assistance
Stakeholders' satisfaction with the
analysis provided
Stakeholders' satisfaction with the
technical support
Annual Activity Report (new
available with the
establishment of the
Authority)
Single Market Scoreboard
(existing)
Stakeholders feedback (new)
To enhance up-take of joint
inspections
Number of joint inspections (per area
under ELA remit).
Number of trainings per joint
inspection.
Number of countries participating in
joint inspections
Benefits generated by joint
inspections (e.g. improved workers
situation, collection of social security
contributions).
Cases on cross-border fines,
notification of fines, recovered tax
and social security contributions
Costs of joint inspections
Annual activity report (new
available with the
establishment of the
Authority)
Labour inspection reports,
including figures and cases on
cross-border fines,
notification of fines,
recovered tax and social
security contributions
UDW platform annual report
(existing)
Stakeholders feedback (new)
Evaluation report of joint
inspections (new available
with the establishment of the
Authority)
Mediating and
facilitating a solution in
cases of disputes
To enhance effectiveness of
administrative dispute
settlements
Time needed to settle disputes
Increase in number of areas under
ELA remit for which dispute
settlement is used
Share of implemented/respected
Annual activity report (new
available with the
establishment of the
Authority)
Stakeholders feedback (new)
65
decision
To facilitating cooperation
in cases of labour market
disruptions affecting several
Member States
Number of cases where the Authority
is required to intervene
Number of application for the use of
the European Globalisation
Adjustment Fund.
Annual activity report (new
available with the
establishment of the
Authority)
While the preceding analysis (section 2) suggests that the problems are likely to remain
without an EU action, it is difficult to foresee how situation would evolve in relation to all
above indicators and to establish the benchmarks for success. Having said that some elements
of success could be outlined for some of the indicators, subject to further development in line
with the guidelines on “Performance indicators in EU agencies”94
once the Authority and its
mandate is confirmed. Stakeholders consultation demonstrated dissatisfaction with the way
information is exchanged today. Thus high share of information exchanged within deadlines
(i.e. timeliness of action) and high share of stakeholders considering that the burden related to
exchange was reduced could be considered as a success. In the area of joint inspections
success could be differentiated between road transport and other areas. A target could be set
for the concerted checks in the road transport in terms of how many should be carried out and
in terms of costs. Member States are obliged to carry out at least 6 checks per year, leading to
minimum 90 checks per year, while currently only half of Member States are actually doing
them. Thus, success could be defined as carrying out the minimum required number of checks
and reducing the costs of the inspections, taking costs of current inspections that are assisted
by EuroContole Route-voluntary network of inspection authorities as a benchmark. In other
areas, success would be uptake of the instrument given the early stage of implementation of a
new function, i.e. increase in the number of inspection and Member State using it, especially
those that have previously established bilateral agreements. Similar considerations apply to
the enhancement of dispute settlement. In the area of risk analysis and capacity building one
dimension is that users find outputs and services relevant and of good quality. Thus, the
success would be high level of their satisfaction. This could be compared to the satisfaction
levels in areas where training and mutual learning programmes were already provided (e.g.
Eures, EESI or UDW Platform). Other dimension, particularly for risk assessment could be to
what extent the analysis helped to increase the number of joint-inspection proposed by the
Authority and accepted by the Member States. In the area of information, performance
indicators should build on the performance measurement system for EURES95
and proposed
performance system for the SDG.96
94
Developed by the Working Group on Performance measurement of the Performance Development Network of the EU
Agencies.
95
Commission Implementing Decision (EU) 2018/170 of 2 February 2018 on uniform detailed specifications for data
collection and analysis to monitor and evaluate the functioning of the EURES network (Text with EEA relevance.)
96
Presented in section on monitoring and evaluation of the IA accompanying the proposal for regulation, SWD (2017) 231
final, PART 1/3.
66
For measuring the performance of the Director/Head of Agency in achieving operational
objectives (as reflected in the Agency’s Programming document97
) and in managing the
financial and human resources allocated for this purpose, key performance indicators should
follow the respective Commission Guidelines.98
Progress will be assessed by using the regular reports by the new body (Annual Activity
Report99
, Multiannual and annual work programme), reports on EURES activity (art 33),
Single Market Scoreboard100
, Single Digital Gateway, PES network and UDW Platform.
The Annual mobility reports under EURES regulation101
, will serve to track general mobility
flows and the policy background of the European Social Pillar and the Social scoreboard
established to monitor progress on the ground will serve to track general employment/labour
market conditions and societal trends and performances across countries. With further
evidence provided through the annual review on Employment and Social Developments in
Europe (ESDE), the Commission will be able to produce reporting on improved compliance
and enforcement.
Eurostat (EU Labour Force Survey) and National labour market data could also be used to
monitor the impact of a Regulation.
The Commission might also run Eurobarometer surveys and/or promote independent studies
to survey specific aspects of the Regulation along the policy or contextual needs and where
those aspects are requesting dedicated research.
9.2. Evaluation
The Commission will evaluate the Regulation 5 years after the Regulation enters into force in
line with the requirements of Financial Regulation102
and Better regulation Guidelines.103
The evaluation will include an assessment of whether the objectives of the Regulation have
been reached. The assessment will build on the information described in this Impact
Assessment and will take into account available monitoring data. Additional information and
views will be collected by a public consultation and/or specific stakeholder consultation
97
Article 32 of the Framework Financial Regulation.
98
Guidelines on key performance indicators (KPI) for directors of EU decentralised agencies, SWD (2015) 62 final.
99
Regulation (EU) No. 1271/2013 of 30 September 2013 on the framework financial regulation for the bodies referred to in
Article 208 of Regulation (EU, Euratom) No. 966/2012 of the European Parliament and of the Council, Financial Regulation
1605/2002.
100
http://ec.europa.eu/internal_market/scoreboard/index_en.htm
101
Regulation (EU) 2016/589 of the European Parliament and of the Council of 13 April 2016 on a European network of
employment services (EURES), workers' access to mobility services and the further integration of labour markets, and
amending Regulations (EU) No 492/2011 and (EU) No 1296/2013.
102
Regulation (EU) No. 1271/2013 of 30 September 2013 on the framework financial regulation for the bodies referred to in
Article 208 of Regulation (EU, Euratom) No. 966/2012 of the European Parliament and of the Council, Financial Regulation
1605/2002.
103
Better Regulation Guidelines, SWD (2017) 350.
67
and/or a survey of stakeholders to review the impact of the Regulation on the different
categories of stakeholders, especially on national authorities.
A particular focus will be cast on the evaluation criteria required by the Better Regulation
guidelines, i.e. effectiveness, efficiency, coherence, EU value added and relevance. The
periodic evaluation of the Authority will also allow exploring further synergies and
streamlining opportunities with the four Agencies active in the area of employment and social
policy.
Evaluation of the Regulation will be also informed by other relevant studies and future
evaluations of legislation in line with legal requirements in the area of cross-border mobility
(e.g. Enforcement Directive, Posting of Workers, Eures) and in related areas (e.g. Single
Digital Gateway, Solvit action plan, IMI).
The scope of the Authority could be extended to additional areas following evaluation results.
68
ANNEX 1: PROCEDURAL INFORMATION
 Lead DG, DEcide Planning/CWP references
The lead DG for this initiative is DG EMPL. This impact assessment report concerns
initiative with Decide planning reference 2017/EMPL/1746 - "European Labour Authority."
Foreseen adoption date: 13 March 2018.
 Organisation and timing
A Commission inter-service steering group (ISG), jointly chaired by the Secretariat-General
was established in November 2017 for preparing this initiative.
The following DGs and services were invited to the inter-service group included: SG, ECFIN,
TAXUD, SANTE, HOME, CAB-JUNCKER, HR, OLAF, ESTAT, EAC, BUDG, GROW,
JUST, SJ, DIGIT, CNECT, FISMA, COMM, MOVE,
The ISG met 2 times in the period from November 2017 to January 2018. Additional bilateral
meetings as well more intensive cooperation was organised with the DGs most concerned by
the initiative (notably GROW, MOVE, DIGIT, COMM) as well as with DGs that manage
Agencies of similar operational nature (notably HOME, JUST, FISMA).
 Consultation of the RSB
The Regulatory Scrutiny Board ("RSB") was consulted on 7 February 2018. The RSB issued
a negative opinion. A second version of the document was submitted on 15 February 2018.
The tables below shows how this report takes into account the RSB comments.
1st
RSB Opinion (copy of the RSB comments
from the opinion)
How and where comments have been
addressed
1. The report does not clearly define or explain the
scope of the initiative, nor does it develop the
rationale for it.
The thematic and personal scope has been
frontloaded in the introduction (p.7) and
explained more extensively in section 2.4
(pages 23), including the rationale for it.
2. The analysis does not sufficiently explain how it
arrived at the preferred option and why it discarded
some measures of other options.
The introduction to Section 6 (p. 27-28)
explains the rationale for the presentation
of the policy options in blocks of inter-
linked elements and their cumulative
nature.
A more thorough explanation of the
comparison and of the preferred option has
been added in Section 6.6 (pp. 42-43).
(3) The report does not differentiate between Sections 6.1 to 6.4 (pp. 29-31) clarify
69
responsibilities transferred to the ELA and new
competence for enforcement. It does not
adequately show how creating an ELA would
result in synergies without losing the specificities
of existing procedures and bodies.
which of the proposed new tasks build on
tasks currently performed by
committees/networks and which would be
entirely new.
As regards the Delivery Options (Section 7,
p. 43 and ff), the procedures and bodies
continue to operate and ELA ensures
complementarities.
(4) The report does not sufficiently explain what
governance provisions would apply to the ELA or
the High Level Labour Council (HLLC). The
report does not explain the relationship between
the ELA and the HLLC.
This option is not presented in this version
as a consequence of a different approach
(based on delivery and not on governance).
(5) The report does not sufficiently present the
views of stakeholders.
More complete presentations of the
stakeholders' views have been presented
under each policy driver (section 2.2.1, p.
11-12; section 2.2.2, p. 13; section 2.2.3,
p.15; section 2.2.4, page 17; section 2.2.5,
p. 18; section 2.2.6, p. 21) and more
thoroughly in a dedicated section at p. 30-
31.
Stakeholders' views on the possible set-up
of an Authority are presented in a dedicated
paragraph in section 7.1.4., p. 45-46.
Annex 2 provides an overview of the
stakeholders' consultation.
(6) The report does not provide robust cost
estimates of the ELA.
More budget and technical details have
been added in the Section 6.5.4 (pp. 39-40)
as regards to the costs of the tasks; Section
7.2.3 (pp 48 ff) with details on the costs of
delivery options; and Section 8.1 (p. 56)
with details on the preferred options.
Further technical details are laid down in
Annex 4.
70
2nd RSB Opinion (copy of the RSB comments
from the opinion)
How and where comments have been
addressed
1. The report does not clearly address the risks of
complexity and potential duplication associated
with the creation of an ELA while maintaining the
6 bodies in the area of labour mobility and social
security coordination.
Insofar as still relevant to the proposal, an
explanation has been added to sections
7.2.1 ("Effectiveness", p. 49-50) and 7.2.2
("Legal impact", pp. 51-52).
2. While an evaluation of existing decentralised
Agencies in the employment field is ongoing, the
report does not take into account the potential
streamlining and increased synergies between the
existing Agencies and the ELA.
The Report explains in depth the possible
risks associated to streamlining the existing
Agencies and the ELA (sections 2.2.6, Box
1, p. 20, and 7.2.1, p. 50-51) and includes a
preliminary analysis of possible synergies
in section 7.2.1, p. 50-51.
(3) The report does not provide for robust budget
estimates. It does not clearly explain the
aggregated total costs associated with the preferred
combination of tasks and structure for the ELA.
The report presents the necessary estimates
in part 7.2.3 (p .52-54), including
breakdowns by task and by delivery option
with updates. Annex 4 provides a complete
explanation of the estimation methods
adopted.
 Evidence, sources and quality
The Commission used various existing or forthcoming sources as quoted in the impact
assessment, its internal analytical capacities including for the assessment of budgetary
impacts and drew on its existing contracts to gather evidence that was used to support this
impact assessment. This included:
o Ad hoc request to the FreSsco experts from all Member States on the capacities of
labour inspectorates to deal with cross-border cases
o Ad-hoc request under the ICF contract for UDW Platform support services to
develop 3 case studies on the basis of qualitative interviews on resources for cross-
border cooperation in the enforcement area.
The Commission awarded a contract to the ICF for the analysis of replies to targeted
consultation and to open public consultation (Tender for VT/2017/056 “Analysis and
Summary of the replies received in the framework of the public consultation for the
establishment of a European Labour Authority and the introduction of a European Social
Security Number”).
71
ANNEX 2: STAKEHOLDER CONSULTATION
In his 2017 State of the European Union address, the European Commission's President Jean-
Claude Juncker proposed that a European Labour Authority (ELA) be established to
strengthen cooperation between labour market authorities at all levels and better manage
cross-border situations. In line with the Commission's Work Programme, the Commission is
scheduled to present a proposal in the first semester of 2018.
This report analyses and summarises the replies to the open public consultation (OPC) and the
targeted consultation of stakeholders on the establishment of an ELA.
Description of consultation activities carried out:
A 6-week internet-based OPC was launched by the European Commission on 27 November
2017 in order to explore the views of the citizens and stakeholders on the establishment of a
European Labour Authority (ELA). Alongside, the Commission had launched a targeted
consultation to stakeholders that had begun on 6 November 2017 with a view to collect views
and positions from practitioners, including Member States, public authorities and social
partners. The consultation process was concluded on 7 January 2018.
An additional targeted stakeholder consultation in the transport sector was launched on 12
January 2018 and closed on 2 February 2018.
1. Overview of the consultation process
Open public consultation
A total of 8,809 replies to the web-based OPC were received. While there were only 389
unique replies, a campaign led by the European Trade Union Confederation (ETUC) resulted
in 8,420 identical replies in favour of the establishment of ELA. These responses were
excluded from the OPC analysis as they would have otherwise skewed the results towards the
answers predefined by the campaign. The opinion brought forward by the campaign is taken
into account in the analysis of the open-ended questions.
The majority of respondents overall (77%) were located in Austria and Germany. Among the
389 respondents who submitted a non-campaign reply, the highest number of unique replies
came from the United Kingdom (61), followed by Belgium and Germany (both 24).
Most respondents indicated being in employment. Among non-campaign respondents, 49%
had either current or past mobility experience compared to 26% of campaign respondents.
Few responses were received on behalf of organisations, based on what could be established
from the data. Social partners more frequently took part in the OPC than other types of
organisation.
72
Targeted Consultation
Position papers submitted by organisations taking part in the consultation, including in the
transport sector, as well as the minutes of stakeholder hearings on the ELA were reviewed and
analysed.
2. Analysis of the consultation responses
2.1. Challenges as regards EU labour mobility
The European Commission bases its proposals for a ELA on two challenges as regards EU
labour mobility:
 Inadequate cooperation between national enforcement authorities
 Incomplete or sparse information on labour mobility rights and obligations
Results from the open public consultation
About two thirds of respondents agree or strongly agree that the existing cooperation between
national authorities is not enough for an effective employment and social security policy
implementation in the EU involving cross-border situations (0).
Q1. Please indicate the extent to which you agree or disagree that existing cooperation
between national authorities is insufficient to ensure the effective implementation of EU
employment and social security rules in cross-border situations
Source: ICF based on responses to the OPC for the establishment of a European Labour Authority and of a
European Social Security Number. Answers of respondents from the Campaign are excluded.
A clear majority of OPC respondents agreed that the issues listed by the Commission were as
many challenges to effective cooperation between national authorities on EU cross-border
mobility 0.
Q1
No
answer
Don't
know /
cannot
answer
Strongly
disagree
Disagree Neutral Agree Strongly
Agree
N
% 7% 2% 9% 7% 7% 33% 34% 389
73
Q2. Please indicate the extent to which you agree or disagree that the elements presented
in the figure below constitute challenges to effective cooperation between national
authorities on EU cross-border mobility:
Source: ICF based on responses to the OPC for the establishment of a European Labour Authority. Answers of
respondents from the Campaign are excluded. Percentages are calculated on the total number of responses
(N=389).
A number of respondents raised concerns about the lack of common EU standards for cross-
border cooperation on employment and social security matters and the administrative costs
that this brings about. This is also combined with the lack of information, unclear
communication and lack of transparency as well as unclear rules.
The sample sizes were too small to detect statistically differences in responses by
organisation type, country, or labour status. This was mostly due to the high number of
nonresponses for these categorical variables.
Results from the targeted consultation
Most of the responding stakeholders agreed with the analysis presented in the note on ELA of
the most significant challenges linked to improving cooperation at EU level on cross-border
employment and social security matters104
.
The challenge most frequently mentioned by the various contributors relates to the
effectiveness of information exchange. Most EMCO members, EPSCO as well as certain
members within the ECPW (EE, ES, FR, LV, PL) and MISSOC (AT, IT) highlighted
inefficiencies in terms of information exchange and access to information by relevant
104
Question 1: "Do you share the above analysis of the most significant challenges linked to improving cooperation at EU
level on cross-border employment and social security matters?"
74
Member State authorities as a major cause of social security fraud and abuses and a major
challenge to overcome.
Along with issues around information exchange, many of the abovementioned stakeholders
highlighted that differences in administrative capacity between the Member States act as a
barrier to effective cooperation. This was especially the case among MISSOC members
overall.
A number of stakeholders (French government; AC: BE member; EFBWW; ECPW: ES FR,
IT, LV, PL members; PES Network; SLIC; UDW; ETUC and affiliates) highlighted that
issues around cooperation and coordination between Member State authorities are primarily
caused by specific and complex national administrative landscapes and the lack of
streamlined procedures, often with implications for institutional capacity. In its common
position, the PES Network added that challenges on cross-border mobility and social security
coordination remain as systems in the EU are not harmonised arguing that the ELA could
address issues around capacity building which prevents effective cross-border cooperation.
The UDW highlighted the fragmentation of efforts to address cross-border mobiilty issues,
with many different tools for cooperation existing on EU level; in addition, there are many
different bilateral agreements between Member States.
Weak or absent mechanisms for joint cross-border investigation and for dispute settlement
was also a challenge mentioned by certain stakeholders, albeit less frequently. This view was
shared among the European Parliament's Employment and Social Affairs Committee, the
UDW, PES Network, the ILO and the Nordic-Baltic-Polish EU Information Group. Social
partners overall also highlighted the absence of a dispute resolution forum as a challenge for
resolving litigation on cross border cases. While employer organisations such as Business
Europe were overall sceptical of the idea of giving the ELA a dispute resolution function due
to potential interference with the ECJ, trade unions such as ETUC were more in favour of the
idea so long as the ELA provided out-of-court solutions.
2.2. Incomplete or sparse information on labour mobility rights and obligations
Results of the open public consultation
A vast majority of the respondents agreed that insufficient access to information and
transparency on cross-border mobility rules is a problem for individuals and businesses 0.
75
Q3. Please indicate the extent to which you agree or disagree that insufficient access to
information and transparency on cross-border mobility rules is a problem for
individuals and businesses:
Source: ICF based on responses to the OPC for the establishment of a European Labour Authority. Answers of
respondents from the Campaign are excluded. Percentages are calculated on the total number of responses
(N=389).
Again, a clear majority of OPC respondents agreed with the challenges identified by the
Commission to fair and easy access to information and transparency of labour mobility rules
(0)
76
Q4. Please indicate the extent to which you agree or disagree that the elements presented
in the table constitute challenges to fair and easy access to information and transparency
of labour mobility rules:
Source: ICF based on responses to the OPC for the establishment of a European Labour Authority. Answers of
respondents from the Campaign are excluded. Percentages are calculated on the total number of responses
(N=389).
Note: percentages labels below 5% have been omitted from the figure to improve readability.
Among the respondents who provided additional comments105
the most frequent cause
mentioned was institutions' limited administrative capacity to deal with mobility, while the
most frequently cited solutions were the creation of a one-stop shop or a better
communication channel where straightforward clear information is accessible to all.
The sample sizes were too small to detect statistically differences in responses by
organisation type, country, or labour status. This was mostly due to the high number of
nonresponses for these categorical variables.
Responses of the targeted consultation
A few contributions explicitly mentioned incomplete or sparse information concerning labour
mobility rights and obligations as a challenge to cross-border mobility. A number of issues
were raised, such as: circumvention of the law caused by unclear or insufficient information
(French EMCO member), technicality of the legislation causing confusion in enforcement
105
“Please explain” question after Question 4
77
(HR and IT MISSOC members), lack of awareness to seek the right information (Swedish
PES), and need for clarification on EU rules on the posting of workers (employer
organisations overall).
3. Policy options in relation to tasks carried out by a European Labour Authority
Results of the open public consultation
All the potential functions for the ELA proposed in the OPC received strong support overall,
in particular supporting information exchange for businesses, individuals and between
national authorities.
Q5. Please indicate the extent to which you agree or disagree that following functions
could be usefully carried out by a permanent EU body dealing with labour mobility and
social security in cross-border situations:
Source: ICF based on responses to the OPC for the establishment of a European Labour Authority. Answers of
respondents from the Campaign are excluded. Percentages are calculated on the total number of responses
(N=389).
Note: percentages labels below 5% have been omitted from the figure to improve readability.
Among the OPC respondents who further commented106
, a frequent observation was that an
ELA would clearly improve data collection and communication with added value in terms of
law enforcement, dispute resolution, social dumping prevention and support for national
106
Please explain” question after Question 5
78
authorities to post workers. A few respondents were concerned about data privacy and
expressed scepticism about the need for a central EU body.
The sample sizes were too small to detect statistically differences in responses by
organisation type, country, or labour status. This was mostly due to the high number of
nonresponses for these categorical variables.
Results of the targeted consultations
Stakeholders were asked what exactly a newly created ELA could do to support cross-border
institutional cooperation to fight fraud and abuse and to improve the availability of
information to individuals and organisations concerned with labour mobility107
.
The most recurrent views were that the ELA should be above all a platform for information
exchange between other institutions and structures. Sharing this position, the PES Network
added that that the ELA could offer digital solutions to help with data collection, exchange
and analysis. EMCO members argued that this could be achieved through synergies between
the ELA and existing EU instruments. Among the social partners, ETUC and the UEAPME
shared the view that the ELA should act as a.
In this context, a number of stakeholders held the view that the ELA would create value in
acting as a "liaison" plarform or a support service for national enforcement authorities
providing intelligence and other resources especially to remedy capacity issues (AC;
MISSSOC: HR, IT members; UDW; ETUC; UAEPME; EFBWW, Austrian Chamber of
Labour).
In addition to the potential intelligence gathering function that the ELA could have, several
EU agencies have expressed an interest in complementing the work of the ELA based on their
own specialisms. For Cedefop, the ELA could provide expertise relating to the cross-border
challenges that emerge from the digital economy and work towards improving the cross-
border recognition of qualifications, access to training for all EU workers and the forecasting
of skills needs. The ETF argued that its expertise on third country qualification systems and
skills recognition could potentially complement the work of the ELA. EU-OSHA also offered
to complement the work of the ELA while Eurofound argued that the ELA could be granted
powers to request critical data from national labour inspectorates for further investigation
which would result in up-to-date information on frequency and types of labour mobility and
incidence of abuse.
A smaller share of the respondents to the targeted consultation showed themselves in favour
of an ELA with advanced functions, with greater responsibility for inspections and
107
Question 2: "Drawing on existing structures, tools and legislation, how could the Authority effectively support
cooperation at an operational level among Member States for the smooth handling of procedures and to become more
effective in fighting cross-border fraud and abuse? Do you see the need to review any existing structures or tools to
better achieve these goals?"
79
enforcement activities (AC: AT, BE, RO members; ECPW: FR member; MISSOC: PT
member, Austrian Chamber of Labour). The ILO noted that while the EU has made progress
in cross-border cooperation on labour inspections thanks to the SLIC and the UDW, this
should be further intensified through the creation of an ELA. For civil society organisations
overall, the ELA should support cross-border labour inspections beyond the scope of bilateral
agreement while respecting national specificities in this area (e.g. in countries where labour
inspections involve social partners).
There is clear support among stakeholders for establishing the ELA as a single EU
information portal available in all European languages to individuals and organisations alike:
e.g. a "one-stop-shop" dealing with all information requests on mobility and redirecting to
other EU mobility online services (AC: AT and BE members; ECPW: DE, FR, IT, RO
members; FMW; UDW; ETUC; UEAPME; REIF, Austrian Chamber of Labour). Cedefop
highlighted the need to offer citizens easy access to information on the conditions for, and
opportunities of, mobility. This includes the portability of workers’ rights from one country to
another, pension rights but also understanding of labour market needs and job opportunities in
other countries. Eurofound argued that the ELA could aim to make EURES a real job
matching portal directly accessible by employers and jobseekers and bring together a wide
array of information sources on national labour market developments, industrial relations
systems, wages and working conditions. The PES Network suggested that the ELA could
provide an online tool allowing EU workers to check their social security status anywhere and
anytime which may, in turn, decrease non-legal employment and abuse cases. Similarly, the
EFBWW proposed a multilingual website and helpline where all forms of cross-border fraud
and abuse of social protection can be reported immediately. For Eurodiaconia, the ELA
should ensure the setting up of services offering guidance and support to those EU mobile
citizens lacking information about their social rights as such services are currently often
provided solely by humanitarian organisations to EU mobile citizens who struggle to receive
any kind of help in registering to the local employment agency and social security system.
Conversely, several members within the MISSOC expressed the view that a unified EU
information portal for both workers and companies could be realised without the need for an
ELA – instead, this could be done through the effective cooperation of relevant DGs (CZ
member) or by improving the visibility and availability of the EURES portal (IT and PT
members). The UK PES highlighted that bringing together information into an ELA portal to
meet the needs of citizens and businesses engaging in cross-border activities could undermine
the Single Digital Gateway SDG’s objective of being a one-stop-shop for digital information
and procedures.
80
4. Potential impacts
Results of the open public consultation
About three-quarters the respondents agreed with the envisaged impacts resulting from
improved cooperation among the Member States on cross-border employment and social
security matters (0).
Q6. Please indicate the extent to which you agree or disagree that improving cooperation
between Member States' authorities on EU employment and social security rules in
cross-border situations would have the following impacts?
Source: ICF based on responses to the OPC for the establishment of a European Labour Authority. Answers of
respondents from the Campaign are excluded. Percentages are calculated on the total number of responses
(N=389).
Note: percentages labels below 5% have been omitted from the figure to improve readability.
Most of the respondents who further commented to their reply were confident that improved
cooperation between Member States would improve data collection and exchange, with some
respondents expecting to see positive results on employment with better work opporutnities
for all. Certain other respondents expressed reservations regarding the centralisation of
personal information on the grounds of data privacy.
The majority of respondents also agreed that improved cooperation among the Member States
would lead to a series of improvements (as those listed in the OPC) (0).The results suggest
that agreement is highest with regard to raising awareness among individuals and businesses
of EU rules and rights.
81
Q7. Please indicate the extent to which you agree or disagree that improving access to
information and transparency for individuals and businesses on EU employment and
social security rules in cross-border situations would have the following impacts?
Source: ICF based on responses to the OPC for the establishment of a European Labour Authority. Answers of
respondents from the Campaign are excluded. Percentages are calculated on the total number of responses
(N=389).
Note: percentages labels below 5% have been omitted from the figure to improve readability.
None of the respondents who further commented on their reply108
mentioned negative
impacts. Rather, they proposed ideas regarding the possible functions of the ELA (e.g. include
seconded national experts proving technical support and advice, introduce a centralised
complaints system etc.).
The sample sizes were too small to detect statistically differences in responses by
organisation type, country, or labour status. This was mostly due to the high number of
nonresponses for these categorical variables.
Results of the targeted consultations
The responding organisations were asked to share views on how the ELA could provide
added value in improving procedures to address issues around social security coordination
among the Member States and labour mobility109
.
Overall, many of the stakeholders thought that the primary role of the ELA should be limited
to facilitating the exchange of information among the relevant Member State authorities (such
as labour inspectorates, etc.) to maximise its added value. This view was shared by the
108
“Please explain” question after Question 7.
109
Question 4: How could the Authority provide added value in enhancing and extending current procedures and fora for
addressing differences in the social security coordination and labour mobility areas?
82
Finnish and Swedish governments, EPSCO and EMCO members, the latter highlighting that
the establishment of the ELA should not result in additional reporting requirements on the
Member States
Going beyond the added value the ELA could create by facilitating cross-border information
exchange, a number of stakeholders pointed out the potential efficiency gains the ELA could
generate e.g. by increasing the level of trust and cooperation between national administrations
and stakeholders, or by creating synergies with other existing instruments. The proposals
made in this regard include streamlining procedures for decision on cross-border cases
(ECPW: ES, IT members); fostering intelligent collaboration with national authorities, social
partners and SOLVIT contact points (ECPW: FR member; EFBWW); focusing interventions
on fewer areas of higher relevance or where EU instruments are lacking (EMCO).
For certain stakeholders, improved information exchange and efficient administrative
coordination through the ELA will bring added value in terms of raising awareness of EU
rules and rights, with positive consequences for law enforcement. EU-OSHA suggested that
the ELA could support an enlarged Senior Labour Inspectors’ Committee (SLIC) which will
improve enforcement by the Member States of Community law on health and safety at work
while Eurofound suggested that the ELA could extend its remit to cover cross-border issues
linked to the information and consultation of workers in multinational companies or arising
from the digital economy and other new forms of work. The ETUC suggested that the added
value of ELA could come from the establishment of an early warning system or alert
mechanism to record and act upon infringement cases. Several stakeholders suggested that the
ELA would generate value by acting as a forum for the exchange of good practices and
lessons learned (AC BE member; ECPW EL member; EFBWW).
For a select number of stakeholders, giving the ELA sufficient scope for action will generate
considerable added value in terms of reducing the risk of social security fraud and abuse in
cross-border situations. This primarily means that the ELA should be responsible for the
coordination of joint investigations or cross-border inspections and for acting as a dispute
resolution forum on cross-border cases (views shared by the French government; the
European Parliament; EPSCO: BE, FR, SE; EMCO ES, EL members; EFBWW, Austrian
Chamber of Labour).
A considerable number of stakeholders were concerned about the risk of duplication or
overlaps resulting from the co-existence of the ELA and other EU-level bodies involved in the
area of cross-border mobility (view shared by AC: BE, NL, CZ, PL, LT, HU, DE, LV, IT
members; PES Network BE, CZ, DE, IE, PL, SE; MISSOC; UDW; SLIC; ILO; Business
Europe). Many of these respondents agreed that increasing administrative complexity through
the creation of a new ELA would cancel out any of its added value.
83
3. Delivery options
Results of the open public consultation
Respondents to the OPC were asked what, in their view, the relationship between the ELA
and other EU agencies, notably those in the employment domain should be (Question 8 of the
OPC). Most of the responses were related to the role that the ELA should have, with many
respondents agreeing tha the ELA should have a coordinating role to improve on existing EU
tools and EU networks rather than a new body with broader scope substituting already
existing organisations. A small number of respondents asked for the establishment of a
centralised EU body incorporating existing EU tools and networks.
The sample sizes were too small to detect statistically differences in responses by
organisation type, country, or labour status. This was mostly due to the high number of
nonresponses for these categorical variables.
Results of the targeted consultations
Regarding options for establishing the ELA, the views of the organisations taking part in the
targeted consultation110
were relatively similar to those expressed by the majority of OPC
respondents in that if a new authority was to be created, its role should be limited to
coordinating the work of Member State bodies and existing EU-level bodies or mechanisms
dealing with cross-border mobility. Stimulating the exchange of information and operational
cross-border action among competent national authorities should be the priority. As such,
most the responding stakeholders believe that creation of a new ELA should not imply a
transfer of competences away from the Member States.
Another recurring view shared by the different stakeholders is that no organisational structure
can be determined if the scope and objectives of the ELA are not clearly defined as this would
risk resulting in increased administrative complexity.
Thus, the most preferred option for a number of stakeholders is stronger cooperation between
existing relevant EU bodies to address cross-border challenges without increasing their
capacity or changing the way they are governed (a so-called "status quo"). Member State
governments overall favoured improving existing EU level structures and mechanisms
dealing with cross-border labour mobility rather than creating a new EU body as subsidiarity
needs to be respected. A considerable number of EMCO members (CZ, HU, IT, LU, NL, SE)
pointed out that there should not be any transfer of regulatory or legal competencies to ELA
away from Member State authorities, and that the need for an ELA would first need to be
assessed against the performance and objectives of current EU instruments. Similarly, many
members within the AC (BE, CZ, DE, HU, LT, LV, NL, PL) and the PES Network (BE, CZ,
DE, FI, HR, IE, SE, UK) argued that a new body may increase complexity and the risk of
110
Question 5: Which organisational structure would you consider to best enable the Authority to efficiently carry out its
tasks?
84
duplication and that synergies between existing organisations and national labour
inspectorates should instead be further enhanced without having an ELA. The same view was
shared by Business Europe, the Estonian ECPW member and the Czech MISSOC member.
Many other stakeholders suggested that a new EU-level network to improve the coordination
of existing EU labour mobility bodies and of national authorities could be created. This option
would require no change in the structure of existing bodies, but would however introduce a
new governance arrangement. In such a case, overlaps and duplication of effort should be
avoided. The overall EMCO position was that the ELA should build on existing networks and
tools so that no additional reporting requirements or costs are passed on to the Member States,
with the Finnish member adding that the ELA could exist as a supporting network and not a
physical agency. EPSCO and the PES Network shared the view that having the ELA as a
network focused on solving concrete problems especially given the lack of clarification of
what the ELA's relationship with existing instruments such as EESSI or IMI would be. While
sharing these views, many other stakeholders argued that the ELA should only have a
supportive rather than an authoritative role so as to safeguard the competencies of Member
State authorities (UDW; SLIC; ECPW: LV, PL, PT, SE members; MISSOC CZ and LV
members; FMW SE member; PEARLE; REIF, Nordic-Baltic-Polish EU Information Group).
A select number of stakeholders showed themselves more favourable to the creation of a new
agency or authority, some highlighting that the proposed mandate of the ELA would still need
to be further clarified (FMW, MISSOC). Other stakeholders proposed a strong governance
structure for the ELA to the extent that is possible in respect of the principle of subsidiarity
(ECPW: ES, FR, IT, RO members; ETUC; civil society organisations). In this respect, the
ECPW and ETUC argued that representatives from the competent Member State authorities
as well as social partners should hold key positions in the governance of the ELA.
In addition, the responding EU agencies (Cedefop, Eurofound, EU-OSHA, ETF) all suggested
that the governance of the ELA could partly integrate their own specific mandates or
competencies in the areas of employment and mobility. The French government also argued
that this could potentially increase the visibility of the activities undertaken by these various
agencies.
Lastly, it should be noted that several organisations who had contributed to the targeted
consultation did not express an opinion on what would be the most appropriate structure for
the ELA – this relates to the general view that the objectives and scope of the ELA would first
need to be clarified to discuss the proposed options for establishing it.
5. Conclusions
Support for the ELA very strong among respondents to the OPC whereas views were more
mixed among the stakeholders taking part in the targeted consultations.
85
The majority of respondents across the OPC and the targeted consultation agreed with the
Commission's analysis of the challenges to cooperation and communication between Member
State authorities on cross-border employment and social protection cases.
Plans for establishing an ELA were rather well received overall. The general view was that
the ELA should focus on improving cooperation among national authorities by facilitating the
exchange of information, intelligence and good practice.
The general opinion is that the establishment of the ELA should not result in a transfer of
competencies away from the Member States, and should not create administrative complexity
and duplication.
Many of the stakeholders taking part in the targeted consultation believed that the mandate
and objectives of the ELA need to be further clarified before deciding on its governance
arrangements. Some among them suggested that an assessment of existing structures and
instruments (e.g. EESSI, EURES, IMI, SOVLIT, UDW) would be needed before deciding on
whether to establish the ELA.
The general opinion with Member States' administrations is that the establishment of the ELA
should not result in a transfer of competencies away from the Member States, and should not
create administrative complexity or duplication.
86
ANNEX 3: WHO IS AFFECTED AND HOW?
o Practical implications of the initiative
If the initiative is accepted its key obligations will apply for the Commission, Member States,
and the new Authority, while individuals and businesses will mainly benefit from it.
Member States will have to propose/determine the seat of the new Authority before the
adoption of the act by the co-legislators and selected “Host” country will have to implement
the actions proposed. In addition, they will have to appoint Members of Management Board
of the ELA, who will have to actively participate in the meetings and they will possibility to
sending national experts to ELA. They will have to nominate National Liaison Officers to the
Authority and cover related costs.
Commission’s obligations will be related initially to the preparatory work to set-up the
Authority(establishment of project team, art-up toolkit ; handling and supporting the process
of reorganisation of existing labour mobility bodies, redeployment of staff/resources,
management of legislative changes of EU legislation etc.) Over the long-term the Commission
will supervise the ELA’s reporting and contribute to its work.
ELA’s obligations are related to work/delivering tasks in line with its mandate, its day-to day-
management of work and more strategic working organisation (e.g. reporting, joint
programmes etc.)
o Summary of costs and benefits
The assessment of benefits and costs had a strong qualitative approach especially for benefits.
While the better cooperation has an impact on improving enforcement, the causal link
between the set-up of a new body and socio-economic impacts, including mobility flows, is
rather remote, owing to the influence of national legislation and to actual rule implementation.
Therefore, the quantification of social or economic impacts and particularly of benefits was
not deemed as realistic.
The benefits for individuals, especially the mobile workers, will be better protection and
reduced exposure to the risk of fraud and abuse, especially in the road transport sector,
improved legal clarity and predictability of procedures.. Further benefits arrive from improved
possibilities to exercise their rights to the freedom of movement.
Business, especially SMEs, will benefit from more fair competition and equal playing field
and from reduced uncertainty about their situation, especially relevant in relation to posting of
workers. That together with better information can facilitate their decisions to engage in
cross-border activities.
Benefits for national authorities are their reinforced cooperation and control capacities for
better rule enforcement as well as savings in terms of time and resources in exchanging
87
information, coordinating activities and in providing information. Benefits of structured
cooperation are expected to increase over the time as more national authorities decide to use
the new operational capacity.
Cost of the preferred option will mainly influence the EU budget with minimum requirements
for national authorities related to the National Liaisons Officers and contributions to the EU
budget. The EU budget costs refer to the situation in 2023 (cruising speed). Costs for tasks are
compared to baseline, but not for the delivery option. Efforts to be made by national
authorities to comply with the existing obligations (e.g. for the timely exchange of
information or data collection) are not considered as an additional cost or burden compared to
baseline.
I. Overview of costs – Preferred option
Citizens/Consumers Businesses Administrations/EU budget
One-off Recurr
ent
One-off Recurrent One-off Recurrent
Labour
mobility
information
and services
for individuals
and businesses
Direct costs
No costs
expected.
5,500,000
Indirect costs
Cooperation
and exchange
of information
between
national
authorities
Direct costs
2,900,000
Indirect costs
Cross-border
labour
mobility
analyses and
risk
assessment
Direct costs
6,700,000
Indirect costs
Support to
joint
inspections
Direct costs
Cost to MS
to be
compensated
by retrieving
unpaid taxes
or
contributions
2,300,000
Indirect costs
Capacity
building
Direct costs
9,500,000
Indirect costs
88
Mediation
between
national
authorities
Direct costs
700,000
Indirect costs
Facilitation of
cooperation
between
relevant
stakeholders in
the event of
cross-border
labour market
disruptions
Direct costs
400 000
Indirect costs
Governance
(administrativ
e costs)
Direct Cost 22-24 million
euro in cruising
speed (2023), not
compared to
baseline,
Brussels-based
MS contribution
to the EU budget
(1) Estimates to be provided with respect to the baseline; (2) costs are provided for each identifiable action/obligation of the
preferred option otherwise for all retained options when no preferred option is specified; (3) If relevant and available, please
present information on costs according to the standard typology of costs (compliance costs, regulatory charges, hassle costs,
administrative costs, enforcement costs, indirect costs; see section 6 of the attached guidance).
89
ANNEX 4: ANALYTICAL METHODS
Assumptions and approaches in estimating budgetary impacts, together with results, are
presented below.
The budgetary impact has been made in details for Policy Option 2 and Delivery Option 2.
The other options have been drawn up in comparison to this milestone.
For Title 1 and Title 2, comparison of most items has been made with three other agencies,
namely the European Fisheries Control Agency (EFCA), the European Border and Coast
Guard Agency (FRONTEX) and the European Foundation for the improvement of Living and
Working conditions (EUROFOUND). EFCA has been chose because it is Brussels-based and
has a mandate to coordinate inspections by Member States; FRONTEX because it has similar
activities as those envisaged for ELA (inspections, training of trainers, training curriculum);
EUROFOUND because it has more or less the same number of staff.
Table 1 – Titles 1 and 2
For staff, the average costs as updated on 13/12/2017 and communicated through the Réseau
des Unités Financières (RUF) has been applied.
90
Table 2 – Average staff costs used
Category of personnel
Total average cost to be used for the
financial statements(*)
Official 143.000 €/year
Temporary agent 143.000 €/year
Seconded National Expert 82.000 €/year
Contractual agent 74.000 €/year
These unit costs have been applied to the number of staff envisaged at cruising speed on a 12-
months basis (upon full recruitment). The number of staff has been assessed taking into
consideration the future workload of the authority per tasks, based on past experience for
activities transferred and benchmarks for new activities such as joint inspections. For
horizontal tasks good practices including internal control requirements regarding the
necessary split between certain financial management and control tasks, have been duly taken
into account.
As regards other entries in the table, the following reasoning has been applied.
Table 3 – Detailed assessment for Titles 1 and 2.
Title 1 – Staff expenditure
Expenditure relating to staff recruitment
Higher than EFCA and lower than FRONTEX and
EUROFOUND due to seat location uncertainties and
reimbursement of travel costs uncertain too
Employer's pension contributions Not applicable
Mission expenses
Higher than EFCA because EFCA is Brussels-based
and all EU institutions are easily accessible; lower
than FRONTEX and EUROFOUND because the
agency is expected to host many meetings more than
send its own staff on mission
Socio-medical infrastructure
Higher than EFCA and lower than EUROFOUND as
the number of staff is the determining parameter
taken into account
Training
Within benchmark range; training needs assessed as
high due to the specificities of the national legislation
in the labour legal framework
External Services (building security,
cleaning, maintenance, etc.)
Building should provide for a lot of meeting facilities
equipped with interpretations booths given the high
number of meetings needed and the low probability
that the staff of the national authorities speaks foreign
language on top of their mother tongue
Receptions, events and representation DG EMPL has 2,400 EUR
Social welfare ZERO
Other Staff related expenditure ZERO
Title 2 - Infrastructure & operating expenditure
Rental of buildings and associated costs (See separate benchmarking for the buildings)
Information, communication technology and Access to powerful internet is key and costs vary a
91
data processing lot from one country to another
Movable property and associated costs Within benchmarks
Current administrative expenditure Within benchmarks
Postage / Telecommunications Depends on the seat location
Meeting expenses Covers meetings for governance issues (Board, etc.)
Running costs in connection with
operational activities ZERO
Information and publishing
ELA must be visible from everywhere & create its
brand
Studies ZERO
Other infrastructure and operating
expenditure
Buffer to possibly adjust to correction coefficient
impacting Titles 1 and 2
For building costs, the approach has been different, as the location and the role of the host
country impacts severely the building costs. Therefore, comparison has been made with
agencies having more or less 130 Establishment Plan posts. The amount foreseen in the Draft
Budget 2018 has been adjusted as if they were Brussels-based, applying the corresponding
correction coefficient of their seat location. The returned average amounts to a bit more than 3
MEUR per year. Details can be found below.
Table 4 – Building benchmarks
Benchmarks buildings (ca 130 EP posts)
Agency MEUR MS Coeff. Corr Bxl
GSA 3.4 CZ 73% 4.64
ERA 1.35 FR 114% 1.19
EBA 3.4 UK 142% 2.40
ESMA 5.6 FR Paris 114% 4.92
eu-LISA 1.5 EE 78% 1.93
Average: 3.20
For Title 3, activities of DG EMPL have been screened to draw a full list of activities that
were relevant for ELA, accompanied by their costs as foreseen in the annual work
programmes and the corresponding staff needed to implement them. Have been taken into
consideration studies, statistical analysis, support to networks, translations, trainings,
missions, web management, etc. These transferred activities represent half of the total
operational budget of the future Authority under the current MFF (see table below).
Based on this first screening exercise, the various options have been built, extending the scope
of the activities when needed or comparing to existing activities implemented by other
services or agencies.
92
In the case of totally new activities, the methodology followed was based on benchmarking
with similar activities carried out by other regulatory agencies in particular, e.g. for the
coordination of joint inspections, and adjusting to size or specificities as envisaged for ELA.
93
Table 5 – List of existing actions to be shifted to ELA
2,7 FTE in 2019 and 5,5 FTE in 2020 whose salary costs are borne by DG EMPL and 1 Seconded National Expert whose salary costs are entirely borne by the EFTA
94
Table 6 - Explanations on Title 3 final amounts per task
95
ANNEX 5: ELA PROBLEM TREE
Insufficient
capacity of
authorities to
organise
cooperation
with
authorities
across
borders
Inadequate operational cooperation between
competent authorities in cross-border
situations undermining compliance and
enforcement of EU rules
Inadequate support
function for individuals
and employers
Insufficient
cooperation
set up at EU
level
Weak or absent
mechanisms for cross-
border enforcement:
- to access/share
information
- to organise joint
enforcement activities
- to solve disputes
Drivers
Problems
Consequences
Workers/individuals
low
awareness/knowledge
of EU rules
lower protection
less mobility
mistrust
risk of abuse
risk of committing
fraud
inadequate working
conditions

Businesses
low
awareness/knowledge
of EU rules
demanding
compliance (more
time/resources
needed)
unfair competition
mistrust
impact on cross-border
activity
Competent
authorities
less
efficient/effective
procedures
lack of mutual
trust
impact on budget
risk of fraud/error
Economy/society
poor functioning
of labour market
& less mobility
mistrust
poor job matching
unrealised
job/growth
potential
shortage of
workers
Incomplete information for
individuals and employers
Incomplete guidance and
assistance to address cross
border issues
96
ANNEX 6: EU ACQUIS RELEVANT FOR THE INITIATIVE
This Annex presents the EU acquis in the area of labour mobility that is directly linked and
influenced by the initiative as well as the EU acquis in other areas on which the Authority can
have an impact.
Labour mobility
In the field of labour mobility an extensive body of legislation sets the framework to ensure
that the fundamental freedoms of the Treaty can work in practice and contribute to a well-
functioning internal market:.
- Free movement of workers is a fundamental principle of the Treaty enshrined in Article 45
of the Treaty on the Functioning of the European Union and developed by EU secondary
legislation. Based on these rules EU citizens are entitled to look for a job in another EU
country, work there without needing a work permit, reside there for that purpose, stay there
even after employment has finished, and enjoy equal treatment with nationals in access to
employment, working conditions and all other social and tax advantages. The following
secondary legislation is specifically relevant:
 Regulation (EU) No 492/2011 on freedom of movement for workers within the Union
 Directive 2004/38/EC on the right of citizens of the Union and their family members to
move and reside freely within the territory of the Member States
 Directive 2014/54/EU on measures facilitating the exercise of rights conferred on workers
in the context of freedom of movement for workers
 Regulation (EU) 2016/589 on a European network of employment services (EURES),
workers' access to mobility services and the further integration of labour markets.
- Coordination of social security rights are essential to free movement of workers, with
rules protecting social security rights when moving within Europe. These rules do not
harmonise, only coordinate social security systems which remain very diverse across Europe.
The EU rules ensure that the application of the different national legislations respects the
basic principles of equality of treatment and non-discrimination, and does not adversely affect
persons exercising their right to free movement within the European Union. Since 2010, the
following coordination Regulations apply, which are currently ongoing revision:
 Regulation (EC) No 883/2004 on the coordination of social security systems as amended
by Council Regulation (EU) No 517/2013 of 13 May 2013.
 Regulation (EC) No 987/2009 laying down the procedure for implementing Regulation
(EC) No 883/2004 on the coordination of social security systems as amended by
Commission Regulation (EU) No 1224/2012 of 18 December 2012.
97
The above Regulations are extended by Regulation (EU) No 1231/2010 to nationals of non-
EU countries (third-country nationals) legally resident in the EU and in a cross-border
situation. Their family members and survivors are also covered by social security
coordination if they are in the EU.
- Posting of workers in the framework of service provision
Specific rules apply to posted workers - employees who are sent by their employer to carry
out a service in another EU Member State on a temporary basis, without integrating in the
labour market there. In order to protect their rights, EU rules ensure for them minimum rates
of pay; maximum work periods and minimum rest periods; minimum paid annual leave; the
conditions of hiring out workers through temporary work agencies; health, safety and hygiene
at work; equal treatment between men and women. These rules are defined in the Posting of
Workers Directive which was approved in 1996 and is currently ongoing revision.
In 2014 the Enforcement Directive was approved with the aim to strengthen the practical
application by addressing issues related to fraud, circumvention of rules, and exchange of
information between the Member States:
 Directive 96/71/EC concerning the posting of workers in the framework of the provision
of services
 Directive 2014/67/EU on the enforcement of Directive 96/71/EC concerning the posting
of workers in the framework of the provision of services.
In addition to the above legislation, Member States also cooperate to tackle undeclared
work, which may have connections. The cooperation takes place within the framework of the
European Platform to enhance cooperation in tackling undeclared work, established by
Decision (EU) 2016/344.
Undeclared work is tackled also in the broader context in relation to fight and prevention of
trafficking in human beings (Anti-trafficking agenda) To address trafficking in human
beings the EU has put in place a comprehensive, gender-specific and victim-centred legal and
policy framework
 Directive 2011/36/EU on combating and preventing trafficking in human beings and
protecting its victims
 EU Strategy towards the eradication of trafficking in human beings for the period 2012-
2016.
 Communication on "Reporting on the follow-up to the EU Strategy towards the
Eradication of trafficking in human beings and identifying further concrete action”
(COM(2017) 728 final)
To support economically successful and socially responsible company restructuring, the EU
can draw on a variety of instruments, ranging from 'soft' policy guidance and 'hard' company
98
and labour legislation to financial instruments. The EU Quality Framework for
Anticipation of Change and Restructuring (COM(2013)882 final) proposes a set of
principles and good practices for the anticipation of change and mitigation of the employment
and social effects of restructuring activities, addressed to all the stakeholders involved. It
contributes to the implementation of legislation and financial instrument by which the EU
seeks to facilitate investment in human capital and the reallocation of human resources to
activities with high growth potential and quality jobs. There exists important EU legislation
on the approximation of Member States' laws relating to collective redundancies (Council
Directive 98/59/EC) or relating to the safeguarding of employees’ rights in the event of
transfers of undertakings, businesses or parts of undertakings or businesses (Council
Directive 2001/23/EC), as well as requirements laid down in a framework for informing and
consulting employees in the EU (Directive 2002/14/EC of the European Parliament and of
the Council), on takeover bids (Directive 2004/25/EC of the European Parliament and of the
Council) or on cross-border mergers of limited liability companies (Directive 2005/56/EC
of the European Parliament and of the Council ). In terms of EU financial instruments, the
European Globalisation Fund (plays its role of solidarity and emergency fund. It is the EU
instrument designed specifically to support employees who lose their jobs as a result of major
structural changes in world trade patterns due to globalisation, such as when restructuring
involves a large company shutting down or moving production.
Internal Market - sectoral policies
- Transport
A wide palette of sectorial legislation is also in place at EU level in order to ensure that
categories of workers in specific sectors have their rights protected when it comes to cross
border mobility and social security. Given the high exposure to cross-border situations and
therefore its high vulnerability to lack of enforcement of social rules, the following social and
market rules in road transport are particularly relevant:
 Regulation (EC) No 561/2006 on the driving times, break and rest periods of drivers and
enforcement Directive 2006/22/EC;
 Regulation (EC) No 1071/2009 on access to the occupation of road transport operator
 Commission proposal laying down specific rules for posting of drivers in road transport
sector, COM(2017) 277
- Data protection An increasing body of legislation ensures both transparency and access to
data on the one hand and the protection of natural persons as to the processing of personal
data on the other hand. For the purpose of the European Labour Authority's functions, which
may process micro data on individuals and employers, the following rules on data protection
in the internal market and data processing by the European Institutions (under revision), are of
relevance:
99
 Regulation (EC) No 2016/679 on the protection of natural persons with regard to the
processing of personal data and on the free movement of such data;
 Commission proposal on the protection of individuals with regard to the processing of
personal data by the Union institutions, bodies, offices and agencies and on the free
movement of such data, COM(2017) 8;
 Regulation (EC)No 45/2001 on the protection of individuals with regard to the
processing of personal data by the institutions and bodies of the Community and on
the free movement of such data;
 Regulation (EC) No 1049/2001 regarding public access to European Parliament,
Council and Commission documents.
- Third country nationals
There is also an extensive legislative body in place providing for the rules on cross border
mobility of third-country nationals, depending on their status, notably:
 Directive 2003/109/EC concerning the status of third-country nationals who are long-term
residents;
 Directive 2009/50/EC on the conditions of entry and residence of third-country nationals
for the purposes of highly qualified employment;
 Directive 2014/66/EU on the conditions of entry and residence of third-country nationals
in the framework of an intra-corporate transfer;
 Directive (EU) 2016/801 on the conditions of entry and residence of third-country
nationals for the purposes of research, studies, training, voluntary service, pupil exchange
schemes or educational projects and au pairing (recast of Directives 2004/114/EC on
students and 2005/71/EC on researchers).
Coherence with other EU objectives/initiatives
Commission’s political priorities as stated by the President in his Political Guidelines at the
beginning of the mandate, A New Start for Europe: My Agenda for Jobs, Growth, Fairness
and Democratic Change111
especially with the priorities of ensuring deeper and fairer
internal market; and of a deeper and fairer economic and monetary union. The first one
promotes labour mobility while protecting workers' social rights and ensuring a fair European
labour market.112
For this a good cooperation of national authorities in the area of cross-
border labour mobility and social security coordination is vital in addition to rules setting the
rights and obligations. Under the second priority, the initiative under discussion is coherent
111
https://ec.europa.eu/commission/publications/president-junckers-political-guidelines_en
112
https://ec.europa.eu/commission/priorities/internal-market_en
100
with the European Pillar of Social Rights aiming at guaranteeing more effective rights of
citizens.
The coherence is ensured with relevant policy initiatives and instruments notably in the area
of single market, justice and fundamental rights, and migration and home affairs, regional
policy.
Within the context of the Single Market Strategy113
and as a follow up to EU Citizenship
report 2017114
the Commission recently adopted proposals on a Single Digital Gateway and
SOLVIT action plan115
to give citizens easy, online access to information, assistance and
problem- solving services and the possibility to complete online administrative procedures in
cross-border situations by linking up relevant EU and national-level content and services in a
seamless, user-friendly and user- centric way and to ensure a culture of compliance and smart
enforcement to help deliver a true Single Market. Both initiatives are considered in the
baseline of this IA and the options of this initiative are designed to contribute to them and to
complement them while avoiding overlaps.
Europe on the move116
aims at ensuring a socially fair and competitive internal market for
road transport services given the importance of the sector for the Union's economy and
society by providing by creating a level playing field in road haulage and enhancing the social
framework and employment conditions. The options assessed in the IA, especially its tasks on
risk assessment and framework for joint cross-border inspection, complement and can help to
improve results of measures foreseen to address the problematic practice of "letterbox
companies", complex and non-transparent business models and fight against illicit
employment practices.
The initiative is coherent with the EU Agenda on migration117
and the EU anti-trafficking
legal an policy framework. In view of the future demographic challenges the EU is facing, the
legal migration will have to be enhanced by policies that attract workers that the EU economy
needs and good working EU labour market with labour mobility support services assessed in
this IA are contributing to that. Preventing and fighting trafficking in human beings for
whatever purpose – sexual or labour exploitation is a top EU priority.
113
In 2015, the Commission presented its Single Market Strategy (Upgrading the Single Market: more opportunities for
people and business COM/2015/0550) - final roadmap to deliver on President Juncker's political commitment to unleash the
full potential of the Single Market and make it the launchpad for European companies to thrive in the global economy.
114
EU Citizenship Report 2017, Luxembourg: http://ec.europa.eu/newsroom/just/item-detail.cfm?item_id=51132
115
May 2017 package included also a third element, a proposal for the Single Market Information Tool (SMIT):
http://ec.europa.eu/growth/content/commission-takes-new-steps-enhance-compliance-and-practical-functioning-eu-
single-market-0_en
116
Europe on the move – An Agenda for a socially fair transition towards clean, competitive and connected mobility for all,
COM (2017) 283 final, http://eur-lex.europa.eu/legal-content/EN/AUTO/?uri=CELEX:52017DC0283
117
COM(2015) 240 final https://ec.europa.eu/home-affairs/what-we-do/policies/european-agenda-migration_en
101
The European Semester process has already given prominence to the issues addressed with
this initiative. Most recently, the 2018 Annual Growth Survey118
highlighted the importance
of promoting the mobility of workers across locations, while ensuring the full respect of
existing rights as well as the importance of stronger and more efficient public institution in
building resilient economic structures.
Common Approach on EU decentralised agencies119
aims at improving coherence,
effectiveness, accountability and transparency in the performance of these agencies. It sets out
guidelines in terms of the creation, structure and operation of agencies, together with funding,
budgetary, supervision and management issues. It requires an impact assessment to guide a
decision to create a new agency, and encourages using common and objective criteria in
assessing both the opportunity to disband agencies or to merge them. In that respect, merging
agencies should be considered in cases where respective tasks are overlapping, where
synergies can be contemplated or when agencies would be more efficient if inserted in a
bigger structure. In the joint statement to the Common approach the three institutions urge
decentralised agencies to pursue their efforts to streamline their activities and increase their
performance.
The Commission decided to curb the financial and human resources committed to the EU
agencies.120
This should be achieved by a yearly 1% reduction of staff over a period of five
years for all decentralised agencies taken together (equivalent to a net reduction is a reduction
of 276 posts on the 6 050 posts authorised in 2013). To meet the needs for additional human
resources in certain agencies, the Commission also proposed to create a ‘redeployment pool’
by applying an annual 1% levy on the posts of all agencies that would then be allocated to
‘start-up phase’ agencies and ‘new tasks’ agencies. In total, the EU decentralised agencies
should thus progressively reduce the staffing levels by 10% from 2013 to the end of 2018.
118
Annual Growth Survey 2018, COM(2017) 690 final, https://ec.europa.eu/info/sites/info/files/2017-comm-690_en_0.pdf
119
Joint Statement of the European Parliament, the Council of the EU and the European Commission on decentralised
agencies, 2012, https://europa.eu/european-
union/sites/europaeu/files/docs/body/joint_statement_and_common_approach_2012_en.pdf
120
Communication COM(2013) 519 final on ‘Programming of human and financial resources for decentralised agencies
2014-2020’, 10 July 2013.
102
ANNEX 7: EU LEVEL COMMITTEES AND STRUCTURES IN THE FIELD OF LABOUR MOBILITY
The Administrative Commission for the Coordination of Social Security Systems (AC),
established by Regulations 883/2004 and 987/2009 on the coordination of social security
systems , has both a strategic role in the policy and legislative landscape (e.g. interpretation
questions, the revision of social security coordination rules, statistical data collection,
analytical work, a quasi-legislative function adopting interpretative Decisions and
Recommendations); and an operational role (e.g. solving individual cases, the creation of
tools such as the EHIC or EESSI). It also provides a conciliation mechanism through one of
its subgroups - the Conciliation Board. The AC meets 4 times a year.
The Advisory Committee for the Coordination of Social Security Systems, established by
Regulations 883/2004 has consultative role to the AC as regards to principles and problems
arising from the implementation of the Regulation, with particular regard to the impact of
certain categories of persons. It constitutes an important forum for exchange between the
Commission (chairing the Committee), government representatives from all Member States,
and the social partners.
The Technical Committee and the Advisory Committee on the Free Movement of
Workers ensures cooperation between Member States and a forum for the exchange of ideas
and information. The Technical Committee composed of representatives of Member States
assists the Commission in the technical work and measures on Regulation 492/2011 on
freedom of movement for workers within the Union. The Advisory Committee extends
participation to social partners and discusses questions related to the freedom of movement
and employment, having the possibility to submit proposals for the revision of the Regulation.
Both Committees meet twice a year.
The Committee of Experts on Posting of Workers (ECPW) plays an advisory role to the
Commission and Member States. It facilitates exchange of information and good practice, and
examines difficulties of implementation of Directive 96/71/EC concerning the posting of
workers. The ECPW meets twice per year.
The European Platform tackling Undeclared Work (UDW Platform) operates at two
levels. At the national level, it supports Member States in promoting better working
conditions and formal employment. At EU-level, it provides a forum for the exchange of
information and best practices and for engaging in cross-border cooperation and joint
activities. The activities of the Platform are conducted on a voluntary basis. Members include
one Senior Representative per Member State, and four representatives of cross-industry social
partners at Union level. The Platform meets twice a year.
The EURES network provides information and recruitment services to workers and
employers. It comprises Public Employment Services and the Commission. It formulates the
framework for horizontal support (including the EURES Job mobility portal); analysis of
mobility; and cooperation for apprenticeships and traineeships. The network is governed by
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the EURES Coordination Group, composed of the European Coordination Office (within DG
EMPL) and the National Coordination Offices of the Member States, with representatives of
the social partners also invited. The EURES Coordination Group meets 4 times a year.
104
ANNEX 8: PRACTICAL TOOLS FOR THE SHARING OF ADMINISTRATIVE DOCUMENTS AND
INFORMATION BETWEEN NATIONAL AUTHORITIES IN THE FIELD OF LABOUR
MOBILITY
This Annex provides an overview of the main IT tools set up at European Union level in order
to facilitate the exchange of administrative documents and information between national
authorities on different aspects of labour mobility.
The Internal Market Information System (IMI-system)121
is the corporate IT-based
information exchange and information sharing tool, managed by DG GROW, which connects
national, regional and local authorities across borders. It facilitates the exchange of
information related to the Internal Market field between public administrations across the
EEA that are involved in the practical implementation of EU law. It has a multilingual search
function that helps authorities to identify their counterparts in another country. The system is
based on pre-translated forms, designed to cover the different cases where authorities are
likely to need information from abroad. The IMI-system supports to date 11 different policy
areas/administrative procedures, including the posting of workers, SOLVIT and the European
Professional Card (EPC). Support for the Posting of Workers Directive and the Enforcement
of the Posting of Workers Directive have been implemented through a number of modules for
different types of exchange. IMI can be used as a common case management tool among
national institutions.
European Register of Road Transport Undertakings (ERRU) is a system of electronic
communication between designated national authorities to exchange information about road
transport undertakings and infringements committed by them against the EU social and
market rules as well as relevant national rules.
Electronic Exchange of Social Security Information (EESSI)122
– operating in the area of
social security coordination - is an IT system which will introduce electronic message
exchange between approximately 15.000 national social security institutions, facilitating
communication and cooperation on cross border cases. Currently under national
implementation, Member States are expected to connect their systems to it until mid-2019.
EESSI (Electronic Exchange of Social Security Information) currently provides the national
institution directory. It contains national institutions (public and private contracted under the
public schemes) in all social security sectors. The EESSI architecture is planned to enable
national institutions to exchange information within social security through a number of
agreed-upon business messages: Structured Electronic Documents (SED).
121
http://ec.europa.eu/internal_market/imi-net/index_en.htm
122
http://ec.europa.eu/social/main.jsp?catId=869
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Under preparation/implementation/pilots
 European Professional Card (EPC)123
EPC is not a plastic card, but an electronic
certificate issued via the first EU-wide fully online procedure for the recognition of
qualifications. It is an example of a citizen’s usage of electronic certificates for interacting
with national institutions. This digital procedure uses IMI. The functionalities covered are:
i) information requests – to check the validity of qualifications for professionals wanting
to practice in a country; ii) register directory – to find a national register of professionals
(architects, accountants, engineers etc.) and iii) notifications – to notify of new diplomas
for architects and health professions. EPC is a pilot in operation for five professions:
general care nurses, physiotherapists, pharmacists, real estate agents and mountain guides.
 e-Sens124
- The objective of e-SENS in the e-Health domain is to facilitate cross-border
access to health services within the EU countries. The cross-border health services domain
is now largely regulated by Directive 2011/24 EU on the application of patients’ rights in
cross-border healthcare, which provides the overall legal framework for the Patient
Summary and e-Prescription pilot within the e-SENS project. Furthermore, the e-
Confirmation pilot, which addresses administrative issues when accessing healthcare
abroad, builds on Regulations 883/2004 and 987/2009 on the coordination of social
security systems. The pilots aim to improve the efficiency of the process for healthcare
providers, health professionals and patients by enabling the electronic exchange of
medical data and insurance information in cross-border settings. The pilots build on the
experiences of the epSOS, NETC@RDS and ENED projects, extending their workflows
into new areas Piloting cross-border data exchange supports the feasibility of cross-border
services.
 European Tracking Service (ETS)125
ETS would establish a European service giving
mobile citizens an overview of their supplementary pensions-portfolio across multiple EU
Member States. It would consolidate data from existing national-level solutions and
provide a reference implementation for Member States that have no national solution in
place. ETS would be the first EU-level initiative within social protection at this level of
digital maturity (requiring electronic identification) and was studied to inform planned
services at the EU level and the EMPSS digital options.
123
http://ec.europa.eu/growth/single-market/services/free-movement-professionals/european-professional-card_da
124
https://www.esens.eu/
125
http://ec.europa.eu/social/BlobServlet?docId=16387&langId=en
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ANNEX 9: INFORMATION TOOLS AND PROBLEM-SOLVING SERVICES FOR CITIZENS AND
BUSINESSES IN THE FIELD OF LABOUR MOBILITY
This Annex provides an overview of the main information tools and problem-solving services
for citizens, including job-seekers, students, workers, inactive and persons, and businesses
with the purpose of facilitating and supporting their mobility choices.
The EURES job mobility portal126
for the exchange of job vacancy and CV data across the
EU also provides information and guidance to mobile workers and support for employers
interested in recruitment. It currently presents almost 1.5 million vacancies. As the digital
front-end of the EURES network, it provides the online tools necessary to help fulfil the job
search assistance, matching and information activities of around 1,000 EURES advisers who
are in daily contact with jobseekers and employers. EURES is also the vehicle for
implementing and testing projects in the area of labour mobility, such as the 'Your First
EURES job' or the 'European Solidarity Corps'. The pages are available in all official EU
languages.
Single Digital Gateway (SDG)127
Part of the compliance package under the Commission's
Single Market Strategy, it aims at offering EU citizens and businesses easy and non-
discriminatory online access to: information about EU and national rules in the area of the
Single Market, procedures for compliance with these rules, and EU and national assistance
services, including EURES. It should address a lack of (a) availability of information about
national rules, (b) quality of information and assistance services, (c) findability of
information, assistance services and procedures, (d) accessibility for cross-border users of
information and procedures, and (e) knowledge of real single market obstacles. The gateway
will consist of a single EU-level portal, which will be based on the already existing Your
Europe portal, with a common user interface, to be established and managed by the
Commission giving access to relevant national and EU webpages.
SOLVIT128
is an informal problem-solving service offered by national authorities dealing
with cross-border problems related to the possible misapplication of EU law by public
authorities. There is a SOLVIT centre in each Member State, as well as in Norway, Iceland
and Liechtenstein. A SOLVIT centre will cooperate with the SOLVIT centre in the other
Member State concerned to solve the problem. Using SOLVIT takes normally much less time
(in average 90 days) than submitting a formal complaint to the Commission or bringing a case
before a national court and can solve an individual problem in cross-border situations. The
service is free of charge and in average 90% of the cases get solved. Several national
institutions have referred to this service as extremely useful. From a mobile citizen’s
126
https://ec.europa.eu/eures/public/en/news-
articles?p_p_id=101_INSTANCE_L2ZVYxNxK11W&p_p_lifecycle=0&p_p_state=normal&p_p_mode=view&p_p_col_id=
column-
2&p_p_col_pos=2&p_p_col_count=3&_101_INSTANCE_L2ZVYxNxK11W_cur=1&p_r_p_564233524_categoryId=10537
127
http://ec.europa.eu/DocsRoom/documents/22761
128
http://ec.europa.eu/solvit/index_en.htm
107
perspective, it allows resolution of cases in a short period of time. The pages are available
throughout the Your Europe portal in all official EU languages. With the adoption of the
SOLVIT Action Plan in 2017, SOLVIT provides regular feedback to the relevant policy units
of the Commission.
Your Europe(129
) – Information portal containing practical and user friendly information, in
23 languages, for citizens and businesses, on their EU rights and opportunities in the Single
Market, involving Member States as information providers. This information is targeted at
people who want to study, work, travel, do business, get healthcare or live abroad, as well as
for people staying at home, with information on work and retirement, health, etc. It is written
in jargon-free language from a user-perspective. The pages on social security (130
) explain
cross-border coverage in a clear and practical manner. The service provides detailed
information for types of cases – with concrete examples. There are links to national
institutions by type of benefit (131
). The National Contact Points (NCP), under Directive
2011/24, have an obligation to provide information on rights to cross-border healthcare. This
includes explaining differences between rights under the social security regulations and under
the Directive. Your Europe is providing information on all these NCPs. The number of visits
of the Your Europe portal has steadily and significantly increased over the past years and this
upward trend continues, having reached 20 M visitors in 2017.
Your Europe Advice132
is an EU-run personal advisory service answering citizens' and
businesses' queries (by phone or online) about their EU rights in the Single Market,
clarification on EU law in the citizen’s and business's particular situation, explanations of how
to exercise these rights, and directions to a national institution or other body if needed. ‘Your
Europe Advice’ relies on a network of more than 63 independent legal experts who handle
enquiries in all official EU languages.
Europe Direct Contact Centre133
- enables citizens to ask a question about the EU, either by
phone or by email. The service is referred to by several national institutions’ websites, but it
could be emphasised that social security coordination issues may be clarified using this
facility.
Your Europe Business - EU portal designed to help Small and Medium-sized Enterprises do
business cross-border.
129
http://europa.eu/youreurope/citizens/index_en.htm
130
E.g. Family benefits: http://europa.eu/youreurope/citizens/family/children/benefits/index_en.htm,
Unemployment benefits: http://europa.eu/youreurope/citizens/work/unemployment-and-benefits/social-
security/index_en.htm.
131
E.g. Pensions: http://europa.eu/youreurope/citizens/national-contact-points/index_en.htm?topic=work&contacts=id-
611493.
132
http://europa.eu/youreurope/advice/
133
http://europa.eu/europedirect/index_en.htm
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DG EMPL website - Pages on ‘your rights country by country’(134
) provide a very
comprehensive set of information on social security for each Member State, as well as links to
the national websites. The pages are available generally in English, French, German, and the
national language of the country concerned. Availability of this content in all EU languages
would provide mobile citizens with directly understandable information.
The Bodies on the Free Movement of Workers comprise different types of institutions
across Member States, including Equality Bodies, Ombudsmen, EURES offices, Chambers of
Labour, Ministries of Labour. These bodies are tasked to promote equal treatment of EU
workers and provide them with assistance (including provision of information and legal
advice). The bodies cooperate with assistance and problem-solving services at EU level (e.g.,
SOLVIT, EURES, Enterprise Europe Network, the Points of Single Contact). A first meeting
between national bodies took place in April 2017.
134
http://ec.europa.eu/social/main.jsp?catId=858&langId=en
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ANNEX 10: OVERVIEW OF POLICY AND DELIVERY OPTIONS
The table below presents three policy options for ELA. The policy options build on each other, i.e. each option broadly incorporates the features of the
previous ones.
Baseline Policy Option 1 – Support Option Policy Option 2 – Operational Option Policy Option 3 – Supervisory
Option
1. Labour mobility
information and
services for
individuals and
businesses
Several sources and tools
managed by EMPL and other
services in the areas under
ELA's scope.
Different contact points at
national level in a number of
areas.
Several tools available to
citizens and businesses more
broadly in the context of EU
rights and obligations (e,g,
the Your Europe portal on
rights and opportunities in the
Single Market, which will be
the backbone of the single
digital gateway - SDG).
 ELA takes over the definition of
the user needs and business
requirements of the EURES
mobility portal and ensures
appropriate links to the Your
Europe portal and for information
relating to labour mobility.
 Cooperation with other Union
initiatives and networks, e.g.
European Network of Public
Employment Services and the
Border Focal Point.
 Coordination of the EURES network
with strengthened support (e.g. building
on synergies with the risk assessment
and capacity building tasks) to increase
its outreach to citizens and impact on
the labour market.
 Technical support to MS for the
provision of services at national level,
including to facilitate compliance with
relevant obligations (e.g. obligations
laid down in Regulation [SDG –
COM(2017)256] and the enforcement
directive on posting 2014/67/EU) and to
map and streamline the provision of
such services in full respect of MS
competences.
 Setting of standards for the
provision of services at national
level based on EU rules and of the
creation of single physical
national contact points.
 Establishment of a single
physical national contact point
on labour mobility.
2.Cooperation and
exchange of
information
between national
authorities
Systems in place:
- EESSI on social security
(under implementation,
mandatory for all cross
border case handling)
- IMI modules on posting
- Collaborative tools for
sharing meeting documents
 ELA monitors and suggests
improvements to current systems
for the exchange of information in
the areas of labour mobility
(EESSI, Fraud and Error Platform,
the use of IMI, ESSN). ELA would
ensure consistency in the use of
different tools and avoid
duplications.
 Promoting and advancing cooperation
between national authorities.
 Supporting MS' compliance with the
information exchange and reporting
requirements established by current and
future EU rules.
 Templates and technical guidance for
the submission of information.
 ELA establishes additional
mandatory requirements for
the collection and exchange of
information in the areas of social
security coordination, posting of
workers, and undeclared work
and can request information to
MS on its own initiative as
necessary to carry out its tasks.
110
Baseline Policy Option 1 – Support Option Policy Option 2 – Operational Option Policy Option 3 – Supervisory
Option
and unstructured
communications.
The exchange of information
mostly takes place on a
voluntary basis.
  Input for the future evolution of
information exchange tools and further
digitisation of procedures, including for
the development of an alert system with
automatic red flags detecting possible
problems (e.g. bogus schemes,
fraudulent temporary work agencies)..
 Development and inventory of
user-friendly templates in aid of
comparability of national
procedures.
3. Support to joint
inspections
No dedicated joint inspection
mechanism.
Joint inspections are very
rare and mainly based on
bilateral arrangements.
 At the request of Member States,
ELA supports national
authorities in the coordination of
joint inspections by (1) organising
joint inspections coordination
meetings and (2) developing a
model agreement establishing a
Joint Inspection Team.
 ELA could suggest that Member
States jointly investigate a problem,
including by encouraging them to
organise joint inspections
bilaterally or concerted checks in
the field of road transport.
 Launch of joint inspections, either at
the request of the Member States or
based on their agreement upon ELA's
proposal.
 Coordination and logistical support
and streamlined procedures for joint
inspections.
 Facilitation of the organisation and
coordination of the concerted checks
of compliance with the social rules in
road transport, in cooperation with
Euro Controle Route (ECR)
 Reporting and monitoring of follow
up-measures

 Joint inspections requested by
ELA.
 Management 'European
Inspector Corps' (drawing on
MS' inspectorates) for
independent action on the ground.
4. Cross-border
labour mobility
analyses and risk
assessment
No dedicated function.
Analyses and studies carried
out (or outsourced) by the
Commission when relevant.
Some specific monitoring and
data collection activities
carried out in existing
committees.
 ELA creates a library of resources
and shares relevant findings and
reports by EU agencies (e.g.
Eurofound, Cedefop, EU-OSHA)
and other relevant sources with the
Commission and the Member
States.
 ELA follows-up on reports by EU
 ELA acts as a labour market
observatory on cross-border mobility,
carrying out analyses and forward-
looking risk assessments in the areas
under ELA's remit.
 ELA takes over some monitoring and
data collection activities (e.g.
statistical data collection about social
 ELA carries out in-depth
assessments on consistency in
enforcement outcomes and issues
recommendations to MS on this
basis.
111
Baseline Policy Option 1 – Support Option Policy Option 2 – Operational Option Policy Option 3 – Supervisory
Option
level citizen-facing services (e.g.
SOLVIT) with further analysis.
Short country summaries on
problems encountered by
citizens/businesses are shared with
the concerned Member State and
the Commission.
security coordination currently carried
out by the Technical Committee on
Free Movement of Workers).
 ELA streamlines data collection
processes, ensuring consistency and
complementarity across all areas.
 ELA carries out peer reviews to
strengthen consistency in the
application and enforcement of Union
law and makes follow-up
recommendations.
 Relevant findings under this task feed
into the other tasks, e.g. capacity
building.
 Regular reporting to the Commission
and the Member States.
5. Capacity Building Mutual learning activities in
the field of labour mobility
(in the context of the EURES
network) and undeclared
work.
 Current mutual learning
activities increased and extended
to all policy areas under ELA's
remit. Service, to be agreed in the
relevant bodies and committees
include: benchlearning, expert
reviews, training and technical
guidelines.
 Thematic Priorities for mutual
learning activities are set by
relevant Committees.
 Technical support to Member
States for awareness-raising
campaigns (+visibility through
 Mutual learning and technical
assistance programme are set by ELA
in aid of building a common
enforcement culture on the basis of (1)
common technical standards developed
by ELA in cooperation with Member
States, (2) needs identified as part of
ELA 'risk assessment' task.
 Promotion of mutual assistance
projects.
 Promotion of good practices.
Support for capacity building
activities at national level (e.g. 'train
the trainer' programme in the field of
 Code for labour and road
transport inspections to be used
on a pilot /experimental basis by
labour and road transport
inspectors across the EU
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Baseline Policy Option 1 – Support Option Policy Option 2 – Operational Option Policy Option 3 – Supervisory
Option
ELA communications channels). labour inspection, support to national
awareness raising campaigns).
6. Mediation
between Member
States
Conciliation procedure on
social security matters in the
framework of the
Administrative Commission
(AC).
 Provision of expert opinions on
all areas under ELA's remit upon
request by at least one of the
interested parties or by the AC
Conciliation Board.
 Follow-up monitored by the AC.
 Conciliation function absorbed in
ELA and extended to all areas under
ELA's remit through a dedicated
function for mediation.
 ELA may issue recommendations to
solve the disagreement.
 Recommend specific solution
 Follow-up monitored by ELA.
 Development of pilot on out-of-
court dispute settlement
7. Facilitating
cooperation in
cross-border labour
disruptions
Guidance by the EU through
the Quality Framework for
Restructuring (QFR). Upon
certain conditions, financial
support is offered via the
European Globalisation
Adjustment fund. Eurofound
constantly monitors
restructuring cases through
the European Restructuring
Monitoring facility.
 ELA raises awareness among
stakeholders about the EU Quality
Framework for Anticipation of
Change and Restructuring (QFR)
and about relevant EU legislation
and available financial instruments.
 Cooperation with Eurofound to
draw lessons from the European
Restructuring Monitor.
 Set-up of ad-hoc support to national
authorities and stakeholders
requiring it, to facilitate administrative
cooperation, share information and
provide guidance on applicable EU
legislation and financial resources, and
coordinate in the event of company
restructuring events with cross-border
implications.
 Cooperation with Eurofound and
EURES to increase risk assessment
capacity on restructuring and to explore
potential support in support re-training
and re-employment.
 Issuing of recommendations as
regards to the management of
cross-border restructuring, in light
of the Quality Framework for
Restructuring, and to the
implementation of relevant EU
legislation.
113
ANNEX 11: LEGAL CHANGES TO IMPLEMENT THE OPTIONS
Amendments
Free movement of workers (Directive 2014/54/EU; Regulations 492/2011 and 589/2016)
Option 1 Option 2 Option 3
Task 1
Directive 2014/54
Recital 21
Article 4
To promote the inclusion of
the 'bodies to promote equal
treatment and to support
Union workers and member
of their family' in a single
national point of contact on
labour mobility and the
application of standards set
by the Authority.
Regulation 589/2016
Recital 15
Article 8.1(a)
The operation of the
EURES portal is
transferred to ELA
Regulation 589/2016
Recitals 5, 11, 15, 24, 47, 49.
Articles 1, 3, 4, 7, 8, 9, 14.
All the responsibilities of the
European Coordination
Office are transferred to ELA
Regulation 589/2016
Recitals 5, 11, 15, 24, 47, 49.
Articles 1, 3, 4, 7, 8, 9, 14.
All the responsibilities of the
European Coordination
Office are transferred to ELA
Task 2
Regulation 492/2011
Article 30
The Authority takes over the
tasks of the TCFMW with
regard to cooperation and
exchange of information.
Regulation 492/2011
Article 30
The Authority takes over the
tasks of the TCFMW with
regard to cooperation and
exchange of information.
Task 3
Regulation 492/2011
Article 30
The Authority takes over the
tasks of the TCFMW with
regard to analyses, data
collection and risk
Regulation 492/2011
Article 30
The Authority takes over the
tasks of the TCFMW with
regard to analyses, data
collection and risk
114
assessment.. assessment..
Regulation 589/2016
Article 30
The Authority takes over the
monitoring and analyses of
labour market flows and
patterns.
Regulation 589/2016
Article 30
The Authority takes over the
monitoring and analyses of
labour market flows and
patterns.
Task 6
Regulation 492/2011
Article 30
The Authority takes over the
tasks of the TCFMW with
regard to the exchange of
experiences and the
formulation of
guidelines/procedures.
Regulation 492/2011
Article 30
The Authority takes over the
tasks of the TCFMW with
regard to the exchange of
experiences and the
formulation of
guidelines/procedures.
Delivery
options
Regulation 492/2011
Targeted amendments to
articles 22 and 30 to
adjust the mandate of the
ACFMW and TCFMW and
allow for participation in
the 'network of networks'.
Regulation 492/2011
Articles 26, 29-35, and 39.
The tasks of the TCFMW are
transferred to ELA. The
TCFMW ceases to exist.
(changes to Article 30 are
already mentioned under
tasks 2, 3 and 6). ELA
participates in the meetings
of the ACFMW as a
permanent observer,
providing technical input and
expertise.
Regulation 492/2011
Articles 26, 29-35, and 39.
The tasks of the TCFMW are
transferred to ELA. The
TCFMW ceases to exist.
(changes to Article 30 are
already mentioned under
tasks 2, 3 and 6). ELA
participates in the meetings
of the ACFMW as a
permanent observer,
providing technical input and
expertise.
Regulation 589/2016
Recitals 5, 11, 15, 24, 47, 49.
Articles 1, 3, 4, 7, 8, 9, 14,
29.
All the responsibilities of the
European Coordination
Office are transferred to ELA
(these changes are already
mentioned under tasks 1 and
Regulation 589/2016
Recitals 5, 11, 15, 24, 47, 49.
Articles 1, 3, 4, 7, 8, 9, 14,
29.
All the responsibilities of the
European Coordination
Office are transferred to ELA
(these changes are already
mentioned under tasks 1 and
115
3). 3).
Social Security Coordination (Regulation 883/2004 and Regulation 987/2009)
Option 1 Option 2 Option 3
Task 2 –
cooperation
and
exchange of
information
Article 1, 72(g), 73, 74 and 76(6)
of Regulation 883/2004
Article 1, 65 and 69 of Regulation
987/2009
Cooperation between Member
States, in particular on settling
financial matters related to the
application of Regulation
883/2004 and Regulation
987/2009, and on matters related
to electronic data exchange and
data processing move from the
Audit Board and the Technical
Commission to ELA.
Article 1, 72(g), 73, 74 and 76(6)
of Regulation 883/2004
Article 1, 65 and 69 of Regulation
987/2009
Cooperation between Member
States, in particular on settling
financial matters related to the
application of Regulation
883/2004 and Regulation
987/2009, and on matters related
to electronic data exchange and
data processing move from the
Audit Board and Technical
Commission to ELA.
Task 3 -
cross-border
labour
mobility
analyses and
risk
assessment
Article 72(g), 73, 74 of Regulation
883/2004
Article 65 and 69 of Regulation
987/2009
Support on analytical task on
financial and technical matters.
Article 72(g), 73, 74 of Regulation
883/2004
Article 65 and 69 of Regulation
987/2009
Support on analytical task on
financial and technical matters.
Task 4 –
mediation
Article 1, 5(4), 6(3), 67(7), 76(6).
Of Regulation 987/2009 –
Conciliation work moving to ELA
from AC and from Audit Board.
Article 5(4), 6(3), 67(7), 76(6). Of
Regulation 987/2009 –
Conciliation work moving to ELA
from AC and from Audit Board.
Delivery
options
Article 1, 72(g), 73, 74, and 76(6) of
Regulation 883/2004.
Article 1, 5(4), 6(3), 65, 67(7), and
69 of Regulation 987/2009.
Article 1, 72(g), 73, 74, and 76(6) of
Regulation 883/2004.
Article 1, 5(4), 6(3), 65, 67(7), and
69 of Regulation 987/2009.
116
Repeals
Committee of Experts on Posting of Workers (Decision 2009/17/EC)
European Platform to enhance cooperation in tackling undeclared work (Decision 2016/344/EU)
117
ANNEX 12: ANALYTICAL SUPPLEMENT
1. Labour mobility in the European Union: key figures
Labour mobility figures provide an idea of the target population which the Labour Authority
would potentially serve.
In 2017, about 17 million EU citizens resided or worked in another Member State other than
that of citizenship, according to the latest Eurostat data. The core of this group is constituted
by the slightly less than 12 million Europeans of working age who were living in a Member
State other than their country of citizenship. As their period of residence in the other Member
State exceeded one year, they are identified as 'long-term movers'. Amongst them, about 9
million were 'active movers', i.e. those employed or looking for work.
Long-term movers make up around 4% of the total EU labour force. Since 2006, labour
mobility has almost doubled from about 2% of total EU workforce, as EU citizens residing in
another Member State were about 9 million. This is in grand part due to the high flows from
EU-13 countries to the EU-15 countries and to a much lesser extent from Southern to
Northern Member States during the economic crisis.
Table 1. Mobile citizens workers in the EU, year 2016
Type of mobility Extent
‘Long-term’ EU-28 movers of working age (20-64 years) living in
EU-28 (Eurostat demography figures)
11.8 million
(as share of the total working-age population in the EU-28) 3.9%
EU-28 movers of working age living in EU-28 (EU-LFS figures) 11 million
…of which active EU-28 movers (employed or looking for work) 9.1 million
(as share of the total labour force in the EU-28) 4%
Cross-border workers (20-64 years) 1.4 million
(as share of the total employed in the EU-28) 0.6%
Number of postings (of employed and self-employed), (no. of PDs
A1, 2016)
2.3 million
Annual return mobility (20-64 years) (2015) 614,453
118
Type of mobility Extent
(as share of EU-28 nationals leaving their country of origin in 2014) 55%
Source: "2017 Annual Report on intra-EU Labour Mobility"
Beyond long-term movers, cross-border workers add up a further 1.4 million to the counting
of labour mobility. These workers reside in one country but regularly move to another for
work purposes, either because they are employed or self-employed in the other Member State.
This phenomenon is clearly concentrated in border regions and constitutes 0.6% of the total
EU employment.
Finally, the third group of so-called posted workers needs to be considered. Posting
operations comprise employees or self-employed who are regularly working in one Member
State but are sent (or move) to another on a temporary basis in order to carry out a service
there. In 2016, there were 2.3 million postings in the EU, up from about 1 million in 2010135
.
Over the last decade, the number of mobile workers has doubled, also as an effect of the
economic crisis. In 2008, EU mobile workers were around 8 million. According to Labour
Force Survey data, between 2006 and 2015 the stock of EU-28 movers (i.e. EU citizens
residing in another Member State) has increased from 7.5 million by 51%, while a further 5%
increase was registered between 2015 and 2016136
. For example, Germany has seen an
increase in the inflow of EU mobile workers from 100,000 to over 350,000 individuals
between 2009 and 2015, while strong outflows were registered during the same time in Spain
and Italy, as well as in Eastern Member States such as Romania, Lithuania and Estonia.
Beside the stock of EU mobile workers, there are some indications that the nature of mobility
has been undergoing some important changes. Notably, short-term moves could have bigger
role in intra-EU labour mobility in the future, as a consequence of company organizational
arrangements (with multinational companies transferring workers on a project basis), of the
availability of cheap travel making short-term moves, for example to provide services across
borders, more accessible than in the past, and of the "mobility mind-set" developed by current
students, in conjunction with the possibilities offered by IT facilities to work from a remote
location.137
135
The number of postings does not strictly equalise the number of posted workers, as the same worker can be posted abroad
more than once during one year. Indeed, whereas postings make up 1% of total EU employment, registered individual
workers constitute some 0.6% of it. However, because of data gaps on the number
of individual posted workers in a few Member States, the number of postings is conventionally taken as a reference.
136
European Commission, "2017 Annual Report on intra-EU Labour Mobility".
137
Bertelsmann, “Harnessing labour mobility”, https://www.labourmobility.com/wp-content/uploads/2014/04/HELM.pdf
119
Labour mobility is also accompanied by beneficiaries of social security benefits drawn from
or in another Member States. While there are clear overlaps between the two groups (a newly
established mobile worker can apply for family benefits or receive healthcare treatment in the
new Member State of residence), not all cross-border social security claimants are in the
labour force, most notably pensioners.
Table 2 provides an overview of the number of EU citizens who have drawn social security
benefits on the basis of EU social security coordination rules, including pensions,
unemployment benefits, family benefits and health care benefits. It also shows the diversity of
information that is exchanged between Member States competent authorities.
Table 2: Social security related portable documents in cross-border situations, the
number and their relative importance (2015, 2016)138
Type of document 2015a
2016 Relative size/expenditures
Statement of
applicable
legislation
(PD A1)
2,05 million
(+6,5%)
2,3 million
(+11%)
<1% of national employment
strong concentration in the construction
sector
Aggregation of
unemployment
periods
(PD U1)
28 127b
38 831d
(-0.2%)e
0,2% of total unemployment in reporting
MS (2015, 2016)
2% of the annual flow of intra-EU
migrants of working age in 2015 (4% in
2016)
Export of
unemployment
benefits
(PD U2)
27 514c
(+5-10%)
27 705c
(+0.7%)
0,1% of unemployed persons in 2015
(0.2% in 2016)
10% unemployed persons with a PD U2
found work abroad (2015, 2016)
Export/import of
family benefits
445 000
households (or
722 000 family
members)
539 000
households (or
909 000 family
members)f
Exports represented 1,4% of the family
benefits paid by all reporting MS in 2015
(1.6 % in 2016) excluding LUg
Strong concentration among a limited
number of (neighbouring) Member States.
Summary of pension
decisions
(PD P1)
119 183h
86 215h
2.8% of the total number of pensioners
reside abroad
0.6% of the total amount of paid pensions
2/3 old-age pension
1/3 survivors’and invalidity pensions
138
There are additional portable documents that are not presented in the table because the statistical data for them is not
collected. This is Portable document U3 (PD U3) about circumstances likely to affect the entitlement to unemployment
benefits. It informs the employment services of the country paying benefits of changes in person's situation which may
lead to a revision of benefit payments. Portable document DA1 (PD DA1) entitles a person to receive medical
treatment under special conditions reserved for accidents at work and occupational diseases in another EU country. PD
S3 certificates entitlement to healthcare in the former country of employment. Useful for retired cross-border workers
who are no longer insured in their former country of employment.
120
Entitlement to
healthcare if living
abroad
(PD S1)
1,4 million
(60% issued to
working age +
30% to
pensioners +10
% family
members)
1,4 million (70
% issued to
working age and
family members
+ 30 % to
pensioners and
their family
members)
0,3% of insured persons
0,2% of the total spending of reporting MS
Planned health
treatment abroad
(PD S2)
34 433 (issued)i
34 433
(received)
28 386 (issued)j
50 686
(received)
0,01 % of insured persons (2015, 2016)
80% issued to receive treatment in a
neighbouring MS
Notes: a
If available, this column present increase compared to the previous year in brackets. b
Reported by 24
MS. No data available for CZ, DE, IE, EL, FR, IT, IS, LI. c
Reported by 29 countries, no data available for FR,
EL and LI.. d
Reported by 26 member States. No data available for DE, IE, EL, CY, SI, LI e
Comparison is based
on 21 countries which reported figures for both years. Missing are some countries with high number of
certificates, like FR, IT, SI and CZ. f
No data available for BG, FR, IT, CY, HU, PT, SI, IS, LI and CH. g
LU is an
‘outlier’ with regard to the export of family benefits. Including LU doubles the share to approximately 3%.h
17
reporting MS in 2015 and 18 in 2016 only. Missing data for a high number of (large) Member States results in
an incomplete and distorted overview. Missing in both years: CZ, DE, IE, EL, FR, HR, CY, AT, PT, UK, LI, CH.
Missing in 2015: DK, IT, HU Missing in 2016: BE, SI, i No data available for issued PD S2: FR, DE, IS, and no
data for received PD S2: DE, ES, FR, CY, PT, SE. j
No data available for issued PD S2: DE, IT, LV, NL, LI.
Because of that, the total number is underestimated as reporting for previous years shows that NL and IT issue
on average some 4,500 PDs S2 a year. No data for received PD S2: DE, IT, LV, PT.
Source: Statistical reports on social security coordination139
These figures give an indication of the caseload for social security institutions tasked with
coordinating cross-border transfers. Within this stock, moreover, possible fraud and errors can
occur, as reported in section 2 below.
In light of these changes, administrating labour mobility and enforcing existing EU and
national rules could generate further challenges requiring a solid governance structure and
appropriate tools.
2. Estimating the extent of cross-border undeclared work and the number of fraudulent
cases in intra-EU mobility
The number of EU-28 movers in 2016140
amounts to around 11 million which is 3,9% of the
EU working age population; adding the 1,4 million cross-border workers and 2,3 million
posted workers, the total of mobile EU workers is well above 14 million. How many of these
workers are involved in undeclared work or fraudulent working relations are largely
unknown. Reliable and harmonised aggregate data is not available, neither on national level
nor on EU level. A rough estimate is carried out on the basis of the available information.
139
Data are collected via administrative questionnaires within the framework of the Administrative Commission. Not all
Member States are always able to provide data,. In addition to the EU28 MS, the EFTA countries are included: Iceland
(IS), Liechtenstein (LT), Norway (NO) and Switzerland (CH). Reports are available on Commission webpage.
http://ec.europa.eu/social/main.jsp?catId=1154&langId=en .
140
European Commission, 2017 Annual Report on intra-EU Labour Mobility
121
Undeclared work and fraudulent practices are by their very nature undeclared to public
authorities. Different methods exist to estimate the size of undeclared work. A variety of
studies is available estimating the undeclared work on national and EU level, often applying
different methods and criteria, inevitably producing equally varied results141
. There have been
very few measurements of the extent of cross-border undeclared labour as a proportion of the
overall undeclared economy; official statistics about fraudulent cases within intra-EU
mobility are not available.
However, on the basis of available information it can be concluded that nationality is not a
determining factor for participation in undeclared work. The Eurobarometer 284 from 2007142
states that "People’s nationality did not have any significant influence on participation in
undeclared work: The share of non-nationals working undeclared was about the same as the
share of the resident population". Analysing the answers to the Eurobarometer 79.2143144
from
2013 reveals that on the EU-level, 3.8% of those in the Member State of their nationality
engage in UDW compared with 2.6% of those not in the Member State of their nationality. It
is worth considering that direct methods such as this survey-based Eurobarometer tend to
underestimate undeclared work as interviewed individuals often underreport their undeclared
activities and many undeclared activities performed by companies, like subcontracting, are
not captured.
In conclusion it can be said that intra-EU mobile workers are significantly less involved in
UDW - 2,6 % versus 3,8% - than those working in their own Member States. In absolute
figures, 2,6% of 14 million mobile EU workers would still result in a significant number
of almost 400.000 cross-border workers involved in UDW per year. Putting this in relation
to latest estimates of undeclared work in the EU - on average, 11.6% of total labour input in
the private sector in the EU is undeclared, and undeclared work constitutes on average 16.4%
of gross value added (GVA) – points to a possible underreporting but still confirms the
magnitude of the problem.145
For undeclared work as a proportion of total labour input there are big differences between
EU countries, with figures ranging from 2,7% to more than 20% in Poland. Similar to the
mobility flows, these figures are not stable over time; they depend on a variety of structural
141
European Semester thematic factsheet 'undeclared work' 2017
142
Special Eurobarometer 284, Undeclared Work in the European Union, 2007
143
Special Eurobarometer 402, Undeclared work in the European Union, 2013
144
Williams, C.C. and I Horodnic, (2018) Participation in undeclared work in the EU28: by nationality of participants, 2013
Special Eurobarometer 402 survey, Available from:
https://www.researchgate.net/publication/322835042_Participation_in_undeclared_work_in_the_EU28_by_nationality_of_p
articipants_2013_Special_Eurobarometer_402_survey, DOI 10.13140/RG.2.2.33068.97929
145
Williams, C.C., Horodnic, I.A., Bejakovic,P., Mikulic. D.,Franic, J., Kedir, A. (2017) An evaluation of the scale of
undeclared work in the European Union and its structural determinants: estimates using the Labour Input Method
(LIM).
122
determinants.146
The few available national estimates are not comparable due to differences in
the methodologies of collecting data and survey dates but they confirm as well the significant
cross-border dimension of undeclared work in the EU. One estimate provided by the French
government identifies that 10 % of all undeclared work in France in 2004 was conducted by
foreign workers without official employment authorisation papers.147
Another by the Ministry
of Labour and Social Insurance in Cyprus identifies that in 2016 based on results of labour
inspections, around 19% of work conducted by other EU nationals was undeclared and around
31% of work conducted by non-EU nationals148
was undeclared.
As stated above no harmonised reliable statistics on fraudulent cases, for example in the area
of posting of workers, exist. Some partially available data can, however, be used as proxies to
estimate the number of suspicious cases that require further information and can subsequently
lead to an investigation and legal action.
The report on fraud and error in the field of EU social security coordination reveals that
fraud and error are still generally recognised by Member States as problematic phenomena;
the provided data confirm this finding. Among others, the report provides for the number of
withdrawn PDs A1 by some Member States. As the number of issued PDs A1 is generally
used as indicator for the measuring the extent of posting of workers in the EU, it is put in
relation to the number of issued PDs A1.
Table 1 Number of PDs A1 withdrawn, 2016
Number of PDs A1 withdrawn
(as competent MS)
Total number of PDs A1
issued in 2016
% of withdrawn PDs A1
in 2016
HU 529 65,725 0.8%
PL 2,050 513,972 0.4%
PT 300 64,459 0.5%
IS 1 239 0.4%
Source Administrative data PD A1 Questionnaire 2017
These partially available official figures are used as a proxy for the total number of withdrawn
PDs A1 on EU level. Withdrawn PDs A1 are not necessarily the proof for fraud but it requires
146
Idem
147
DILTI (2004) Commission Nationale de Lutte contre le Travai Illégal. Paris: Ministere de l’Emploi, du Travail et de la
Cohesion Sociale.
148
Nicos Trimikliniotis (2017) Peer country comments paper: Cyprus, Peer Review on “Joint operation groups
between public agencies – an effective tool to prevent and tackle undeclared work” Oslo (Norway), 25-26
September 2017.
123
an action normally based on an initial suspicion to start the withdrawal process. Often this
action is initiated by one Member State requesting information and/or action from another
Member State after an inspection or control measure.
The total of PDs A1 covered in this sample amounts to almost 30% of all issued PDs A1 on
EU level. Two options are proposed to come a realistic figure on EU level: a conservative
option with 0,1% withdrawn and a more advanced option with 0,4% withdrawn PDs A1. This
results in 2300 withdrawn PDs A1 on EU level for the conservative option and 9200 for the
advanced option. Both figures point to a significant number of suspicious cases and hence to a
strong need for Member State to interact and exchange information.
Another proxy to estimate the total of suspicious cases is the number of requests between
Member States in the posting of workers module in Internal Market Information System149
(IMI-system). The number of requests is likely to underestimate the dimension of the problem
as one request can cover several posted workers, posted by one employer, or active on a
construction site or company site. The total number of requests is continuously increasing,
up to 3100 requests in 2017. In relation to overall number of issued PDs A1 this would mean
a minimum of around 0,13% of suspicious cases within posting of workers.
Always in the report on fraud and error in the field of EU social security coordination the
following figures resulting from Belgian investigations carried out by the ‘cross-border’ units
from 1 January to 31 December 2016 in the area of applicable legislation are available.
Irregularities
N° of
rectifications
Total amount
of rectification
(in €)
N° of
work
ers
rectif
ied
Foreign MS requested to withdraw E101-E102-A1 131 38,722,164.87 1 588
LACK of E101-E102-A1 — Belgian SS rectified 106 17,734,324.45 1 272
Total — request for application of Belgian social security
legislation
237 56,456,489.32 2 860
Salaries employees-Declaration 12 2,563,012.03 56
Salaries labourers-Declaration 146 44,853,109.20 2 513
Total — rectified declarations sent to the ONSS 158 47,416,121.23 2 569
Putting this 2569 involved workers in relation to the number of individual persons with a PD
A1 - 164,253 - that Belgium reported150
for 2016 results in around 1,5% of fraudulent cases in
the field of applicable legislation.
149
http://ec.europa.eu/internal_market/imi-net/index_en.htm
150
European Commission (2017), Posting of Workers. Report on PD A1 portable documents issued in 2016
124
Data estimating the extent of social fraud in the EU is insufficient to have a comprehensive
picture of the size of the phenomenon.
In the following, however, available data sources are compounded with a view to having an
indicative picture of the possible caseload which the new Agency may be set to work on.
Figures are mainly taken from the EC Fraud and Error Report 2017151
if not otherwise
indicated.
Table 4. Cases of fraud and error in different social security coordination domains, 2016
Number of PDs A1 withdrawn, 2016
Number of PDs A1
withdrawn
(as a competent MS)
Total number of PD A1 issued in
2016
% of withdrawn PDs A1
in 2016
DK 6 29,595 0.02%
HU 529 65,725 0.8%
PL 2,050 513,972 0.4%
PT 300 64,459 0.5%
IS 1 239 0.4%
Cases of inappropriate use of the European Health Insurance Card (2016)
Number of cases identified % share in number of claims paid % share in total amount
reimbursed
EE 193 2.8% 3.0%
LT 284 3.5% 2.0%
NL < 100 0.1% 0.02%
AT 791 0.8% 0.8%
RO 315 1.0% 0.6%
Cases of fraud and error in the context of aggregation of periods for unemployment benefits (2016)
Number of cases identified Amount involved % of total PD U1
received
CZ 41 3,925 7.9%
HU 88 6,077 4.5%
ES < 10 n.a. 0.3%
Cases of fraud and error in case of export of family benefits (2016)
Cases % exported cases % exported amount
CZ 199 21% 12%
PL 4,033 12% 4%
RO 998 7% n.a.
Source: Jorens, Y., Gillis, D. and De Potter, T. (2017), Fraud and error in the field of EU social security
coordination, Network Statistics FMSSFE, European Commission (p. 78),
Overall, the share of detected frauds and errors seems to be a minority share of the total. In
the case of the posting of workers, the highest number of withdrawn PD's A1 documents in
2016– Poland's 2,050 – still represents 0.4% of the total documents issued.. In the case of
family benefits, on the contrary, problematic cases can be relatively high, sometimes also due
to the non-communication by beneficiaries about changes affecting the right to these benefits.
151
Jorens, Y., Gillis, D. and De Potter, T. (2017), Fraud and error in the field of E1U social security coordination, Network
Statistics FMSSFE, European Commission,
125
The cases of inappropriate use of the EHIC tend to remain limited and the overall share of
rejected invoices between Member States (around 2% of the total number of claims of
reimbursement received). However, an increase in the number of rejections is observed,
which could lead to an increase in the administrative burden for Member States of stay if
additional information has to be provided/asked in order to receive the reimbursement. It will
also result in a delay of payment or even in a budgetary cost for the Member State of stay if
claims are not accepted by the competent Member States.152
However, data limitations should prevent from drawing too optimistic conclusions. First, only
a tight minority of Member States communicate their national data, therefore the sample is
too limited to allow for generalisations. Second, the number of detected frauds or errors
should weighted against the number of inspections carried out. A small number of detected
frauds could simply be the result of few inspections or of limitations of the available tools to
share key information and proves between Member States. From section 3 above, we know
that the number of controls or inspections per year can range between a few hundreds and the
over 3,000 performed by Belgium. Moreover, the resource-intensiveness of cross-border
controls, also due to lack of adequate cooperation tools and procedures, may lead to selective
controls in the context of limited staff.
3. The use of the Internal Market Information system (IMI)
Enforcement Directive 2014/67/UE has extended the use of the Internal Market Information
system to exchanges of information in the context of the posting of workers. Exchanges are
structured on four modules, namely:
 information requests (including information on posting conditions, occupational health
and safety, working conditions; urgent requests concerning companies' establishment and
requests to send documents to a service provider);
 Request for Recovery of a penalty and/or fine;
 Request for Notification of a decision vis-à-vis a worker or a company
 Communication of possible irregularities
The instrument has increasingly been used over these last years. Overall, information requests
have increased from some 180 in Q1 2012 to over 600 in Q1 2017.
152
F. De Wispelaere, J. Pacolet (2017), Cross-border healthcare, Reference year 2016, Network Statistics FMSSFE,
European Commission.
126
Figure 1. IMI Requests on the Posting of Workers (2012-2017)
Source: European Commission, Internal Market Information system, statistics
(http://ec.europa.eu/internal_market/imi-net/statistics/index_en.htm#t_1_2)
Despite this positive development, the use of IMI remains concentrated amongst a few
Member States. In 2016 and first semester of 2017 (latest available data), three Member
States (AT, BE and FR – with DK joining in 2017) submitted about 80% of the requests. PT,
PL, RO and DE were the Member States receiving most of the queries. While these figures
partly reflect the ranking in the receipt (and sending) of posted workers in the EU, some
Member States seem to making low use of the system, such as Germany or the Netherlands.
Answering speed also varies across the Member States, although there are signs that time is
reducing. While in 2016 some Member States had an average response delay of over 100
days, this is no longer the case. In the first semester of 2017, the average answering speed
ranged between 6 and 58 days (figure 2), including in cases of Member States with above-
average number of requests received. Over half of the Member States remain below the
agreed limit of 25 working days to reply to information requests set in Enforcement Directive
2014/67/EU.
0
100
200
300
400
500
600
700
127
Figure 2. Information request answering speed (January – June 2017)
Source: http://ec.europa.eu/internal_market/imi-net/statistics/index_en.htm#t_0_4
4. National capacities for cross-border cooperation between inspectorates
Information on the administrative capacities and processes of cross-border cooperation is
scant. To date, there is no comprehensive report providing an overview of the control
activities of national administrations on companies and workers in cross-border situations, on
the required administrative effort (e.g. dedicated staff, working days to process a case), the
difficulties encountered, and the needed capacities153
.
In order to partially fill this information gap, in November 2017, the FreSsco network of
experts on labour mobility carried out a survey across the Member States, on behalf of the
Commission, entitled "On the capacities of labour inspectorates to deal with cross-border
cases in the Member States".
The results of the survey are presented below, following the six questions asked. The Study is
based on 25 replies (including those of Switzerland, Iceland and Norway) which vary
substantially in the amount of information provided.
153
A further survey is being carried out in the context of the UDW Platform, under the module "Obstacles faced by
enforcement authorities in tackling undeclared work". The survey will cover three topics: obstacles faced by
enforcement authorities in cross-border cases; National and Bilateral Agreements; and tools for reporting complaints.
The results of the survey will be available in the first semester of 2018.
128
Table 3. Synthesis of the results of the FreSsco study on the capacities of labour
inspectorates in cross-border cases
Member
State
Number of
controls/year
Number
of staff
Work days
standard
request
Work days
legal
investigation
Difficulties Analytical
capacity
AT - - - - Linguistics;
identification
employer;
identification
MS' admin;
prosecution
admin penalties
-
BE 3.846
+ controls by 5
regional
offices
73 2-3 days
278 days
1-3 months
(depending
domain)
15-20 days
-
up to 1 year
(depending
domain)
access info; ≠
interpretation;
linguistics;
regulatory
complexity;
no uniformity;
MS’ admin.
capacity
risk assessment
through data
mining & data
matching
BG 435
(10 months)
not
dedicated
25 days up to 5-6
months
unwillingness
employers
-
HR no cross-
border controls
not
dedicated
up to 2 days 3-4 weeks lack of docs;
linguistics;
unavailability
employers; lack
of info
employees
-
CY 100 not
dedicated
(depending
case)
(depending
case)
Linguistics;
identification of
workers; IT tools
with real-time
into
-
CZ no cross-
border controls
not
dedicated
25 days
2-3 months
(depending
case)
Months
(depending
case)
≠ interpretation;
linguistics;
lack of info
employees
-
DA 24
(first half of
2017)
30-40 - - linguistics;
cultural
differences
data base;
cooperation with
tax 1 police
authorities
DE - not
dedicated
5-35 days
3_12 month
8-14 days
(depending
domain)
-
(depending
domain)
- Data
base;:cooperation
with customs
authorities
EE no cross-
border controls
not
dedicated
2-30 days 30 days
6-12 months
(depending
case)
MS’ admin.
capacity; ≠
interpretation;
linguistics;
no uniformity;
-
FI no cross-
border
controls
(working
conditions
foreign
workers)
20-30
+ 119
administr
staff
internat.
soc. secu.
benefits
6 minutes to
2 days
(depending
domain)
54 minutes to
3-5 days
(depending
domain)
unavailability
employers,
linguistics,
incompatibility
IT; MS' admin
capacity; no
uniformity
regulations &
cooperation with
police,
immigration,
border control &
tax authorities
129
procedures
FR set target of
1.500/month
dedicated
national
body +
dedicated
local units
in regions
(depending
case)
5 months SIPSI system not
user- friendly;
complexity
check work-
residency
permits and
wages; need for
frequency of
controls;
linguistics in
MS'
coupling data
illegal work with
data on posted
work;
identification
target sectors
HU - not
dedicated
1-2 days to 2
months
(depending
case)
employers not
available-
unwilling; MS'
admin capacity
IT and filing
system for risk
assessment
EL N.a. N.a. N.a. N.a. N.a. N.a
HU - not
dedicated
1-2 days to
2 months
(depending
case)
employers not
available-
unwilling; MS'
admin capacity
IT and filing
system for risk
assessment
IS
(Iceland)
- 2 - - employers not
available;
linguistics
cooperation with
tax authorities &
social partners
IRL - not
dedicated
matter of
days
months to
years
- Predictive
analysis and
modelling; data
matching
IT N.a. N.a. N.a. N.a. N.a. N.a..
LV - not
dedicated
1-2 days - linguistics; no
uniformity
standards
processes;
unwillingness
employers; MS'
admin capacity
cooperation with
state revenue
office, state
social insurance
agency
LI
(Liechtenstein)
- - - - lack of info
employees;
respect wage
standards
-
LT 57
(working
conditions
foreign
workers)
not
dedicated
18,7 hours 20 days unavailability
employer; no
uniform
procedures; MS'
admin capacity
-
SI - not
dedicated
- - Low readiness to
cooperate; MS'
admin capacity
-
ES 778 not
dedicated
24 hours to 2
days
(depending
case)
Collection of
fines & admin
penalties – MS'
admin capacity
Database and
records to detect
fraud or non-
compliance
SE no 'labour
inspectorate'
(social
partners
control
conditions
posted
workers)
- - - Privacy rules
between tax
authority, social
insurance agency
& social partners
-
CH
(Switzerland)
'labour
inspectorate'
- - - lack of info
employees;
cooperation with
migration office
130
not dealing
with soc.
security; social
partners
controlling
working
conditions)
respect wage
standards
UK N.a.. N.a. N.a. N.a. N.a. N.a.
LU N.a. N.a. N.a. N.a. N.a. N.a.
MT no cross-
border controls
1 1-2 days 4-5 days no uniformity cooperation with
PES, social.
security & inland
revenue
NL - not
dedicated
- - - own analytical
capacity;
cooperation with
social insur.
board
NO
(Norway)
- not
dedicated
less than one
hour
1-2 weeks access info;
inter-agency
exchange of info
(personal data
issues)
own department
providing
analytical
capacity
PL 271
(10 months)
183 2.8-3.8 days months Access info;
unavailability
employer
-
PT N.a. N.a. N.a. N.a. N.a. N.a.
RO 144 not
dedicated
- - linguistics;
unavailability
employer;
impossibility
check wages &
payment social
security
-
SK N.a. N.a. N.a. N.a. N.a. N.a.
No information:, EL IT, LU, PT, SK, UK.
Source: Ad-hoc FreSsco survey, November 2017
5. Examples of bilateral agreements on inspections
Bilateral and multilateral agreements or understanding of cooperation on cross-border labour
rules have an established tradition, notably in the area of posting but also on undeclared work.
Enforcement Directive 201/67/EU (Article 21(2)) recognises the function of such agreements
or arrangements to integrating institutional cooperation, envisages their publicity and commits
the Member States to inform the Commission.
This notwithstanding, also owing to the recent implementation of said Directive, there is no
repository of bi- and multilateral agreements. Therefore, information is fragmented and not
131
necessarily up-to-date. Those presented below are examples of bilateral cooperation collected
in the framework of the Eurodetachement project154
.
Belgium-Poland (October 2007)155
The agreement signed between the Polish and the Belgian Labour Inspectorates envisages the
exchange of information on the working conditions of posted workers within a delay of
maximum 4 weeks (and within the limits set by data protection legislation) and the
organization of annual meetings of coordination.
France-Italy (September 2011) 156
The agreement signed by the Italian and the French Labour Ministries envisages "particularly
active" cooperation between the respective labour inspectorates on controls on labour
mobility, including the posting of workers, and fight against illegal work.
The agreement establishes that the competent authorities may provide mutual assistance on
the study and carrying out concerted actions of prevention; communicating to each other
changes in the legislative, regulative and administrative framework in the above areas and
carrying out coordinated control actions; and exchanging information on the respective
methods of controls and inspectorate work.
Finland- Estonia (December 2014)157
The agreement concluded by the Labour Inspectorate of Estonia and the Division of
Occupational Health and Safety of the Regional State Administrative Agency for Southern
Finland envisages cooperation in information sharing, including on matters where IMI cannot
be used, exchange of inspectors on concrete cases including the organisation of training and
joint visits in Finland, and efforts to raising awareness of Estonian workers posted to Finland
concerning their rights and obligations while working in Finland and the sharing of related
information. Bi-annual meetings are envisaged in order to take stock of results and further
needs for common action.
Spain-Romania (May 2009)158
The Memorandum of understanding signed by the national labour inspectorates of Spain and
Romania establishes a will to cooperate on matters of posting of workers (including the
verification of genuine activities of posting companies, also during processes of investigation,
and of the status of third-country workers, and the possibility for one of the parties to foster
154
Eurodetachement is a project coordinated by the French National Institute for Labour, Employment and Vocational
Training (INTFEP) which was financed by a grant of the European Commission under the Call for Proposal (VP/2015/007).
155
http://www.eurodetachement-travail.eu/datas/files/EUR/Belgique%20Pologne%2011%20oct%202007%20fr.pdf.
156
http://www.eurodetachement-travail.eu/datas/files/EUR/Dichiarazione_cooperazione_italofrancese__27.09.2011.pdf.
157
http://www.eurodetachement-travail.eu/datas/files/EUR/Agreement_on_Cooperation.pdf
158
http://www.eurodetachement-travail.eu/datas/files/EUR/Memorandum_Espana_Rumania.pdf
132
special campaign of inspections and exchange of information); on the health and safety of
workers and on work accidents.
6. Conciliation procedure in the field of social security coordination
In the field of social security coordination the Administrative Commission (AC) is
designated by a number of provisions of EU rules as the body to resolve such disagreements.
When defining the procedure, two mechanisms are in place: Decision No A1 and the setting
up of the Conciliation Board.
The Decision No A1 of 12 June 2009 concerning the establishment of a dialogue and
conciliation procedure provides for a settlement of disputes between institutions of different
Member States in situations referred to in Articles 5 (Legal value of documents and
supporting evidence issued in another Member State)159
, 6 (Provisional application of
legislation and provisional granting of benefits)160
, 16 (provision of information if person
pursuit activities in two or more Member States and 60 (procedure regarding payment of
family benefits) of Regulation (EC) No 987/2009. It was adopted with the aim to establish a
standard procedure to be followed before a matter may be referred to the Administrative
Commission.
This consists of two stages of a dialogue procedure and, as a last stage, the conciliation
procedure done through the Conciliation Board according to its mandate provided by the
AC.
Dialogue procedure: The first stage of the dialogue procedure is conducted at the
institutional level, i.e. it consists of direct contacts between the institutions concerned. The
second stage of the dialogue procedure involves the competent authorities, i.e. it is conducted
at a ministerial level.
159
As a principle, documents must be accepted by the institutions of the other Member States for as long as they have not
been withdrawn or declared to be invalid by the Member State in which they were issued. When there is doubt about the
validity of a document or the accuracy of the facts on which the particulars contained therein are based, the institution of the
Member State that receives the document must ask the issuing institution for the necessary clarification and, where
appropriate, the withdrawal of that document. Ultimately, where no agreement is reached
between the institutions concerned, the matter may be brought before the Administrative Commission to reconcile the points
of view.
160
If there is a difference of views between the institutions or authorities of two or more Member States concerning the
determination of the applicable legislation, the person concerned shall be made provisionally subject to the legislation of one
of those Member States. Thereby the person is still protected and receives benefits.
133
Conciliation Procedure and Conciliation Board:
in the conciliation procedure disputed issue may be referred by the Administrative
Commission to the Conciliation Board. The Conciliation Board is expected to submit its
opinion on the case within six months.
The dialogue and conciliation procedure established by Decision No A1 presents a number of
challenges:
 The Conciliation Board only deals with disputes where both parties agree to bring the case
in front of it, following the two states of dialogue procedure which already took place
between authorities.
 The Conciliation Board is not equipped to solve disputes regarding the factual
circumstances of a case.
 The Conciliation Board, by its very nature, is not in a position to deliver legally binding
decisions, as the only possibility to get a binding decision on EU level in case of a dispute
between Member States is to start infringement proceedings pursuant to Article 259
TFEU.
 There is a limited ability to monitor and follow-up on the implementation of its
recommendations and decisions. The follow-up relies on Member States reporting back to
the AC at the regularly scheduled meetings of this committee (four times a year), without
a capacity of directly discussing on ground with the institutions concerned and support
them with any difficulties they encounter with the practical implementation of the
recommendation and decisions.
 The procedure of dialogue and conciliation can be very lengthy. The big majority of cases
are resolved on a bilateral manner between Member States during the two phases of
dialogue procedure. Few cases reach the third stage of conciliation: between 2010 and
2017 only nine (9) cases were submitted to the Conciliation Board of the AC. The full
"life-cycle" of a case can therefore be as long as over 3 years.
 Conciliation procedure is limited on posting related issues, while such interpretation
discussions and disagreements are also very relevant in other areas of social security
coordination as an example in the area of family benefits or the determination of
applicable legislation for areas other than in posting situations. On family benefits,
wherever family members live in different Member States and may draw rights to family
benefits from different countries there are many areas in determining which institution is
competent for what type of family benefit which can lead to disputes, with the potential
consequence of delaying the granting of family benefits necessary for the financial
stability of the family. In order to facilitate and formalise exchanges in this field, the AC
adopted Decision F2 in 2016 concerning the exchange of data between institutions for the
purpose of granting family benefits with the aim of speeding up these procedures,
however in cases of doubt a further formalised procedure would be beneficial, in
particular when it comes to disputes.
134
The revision of the Decision A1 is currently ongoing in order to further streamline the
procedure to address as far as possible the above outlined challenges.
Since its creation in October 2010, the Conciliation Board submitted a legal opinion in 2013
and another one 2014 on specific questions referred to it by the Administrative Commission.
Five further cases regarding he validity of A1 posting certificates were referred to the Board
in 2015, and in three of these cases, a legal opinion was submitted by the Board and later
approved by the Administrative Commission. In one of the cases it led to the withdrawal of
A1 posting certificates. A further case of referral has been requested for the December
meeting of the Administrative Commission in 2016. Two new cases were submitted at the
June 2017 Meeting of the Administrative Commission in which the Conciliation Board also
submitted a legal opinion in a dispute between two Member States which was unanimously
adopted.
Conciliation is also in use within the framework of the Audit Board (and its Conciliation
Panel).
The tasks of the Audit Board are:
 To verify the method of determining and calculating the annual average costs
presented by Member States
 to collect the necessary data and carry out the calculations required for establishing
the annual statement of claims of each Member State
 to gives the Administrative Commission periodic accounts of the results of the
implementation of this Regulation and of the Implementing Regulation, in particular
as regards the financial aspect
 to provide the data and reports necessary for decisions to be taken by the
Administrative Commission
The Audit Board meets two times a year, and is composed by expert representatives from
each of the Member States and observers from EEA countries and Switzerland as determined
by the Administrative Commission.
The Audit Board mandated a Conciliation Panel to facilitate closing of accounts where a
settlement cannot be reached between Member States within 36 months following the month
in which the claim was introduced, dealing with the area of implementing the financial
provisions of social security coordination rules, specifically Article 67(6) of the Regulation
(EC) No 987/2009 and Article 2(3) of the AC Decision No H4. This became particularly
relevant since the entry into force of the current social security coordination rules, which
introduced clear deadlines on the settlement of claims between Member States for benefits
provided across borders. To handle the closing of old claims (dating before 2010, under the
rules of the previous social security coordination legislation where no deadlines were
135
stipulated), the Conciliation Panel dealt with a high number of cases, issuing opinions on over
100 disputes in the course of 2017.
7. Your Europe Advice
7.1. Introduction
Your Europe Advice161
(YEA) is an EU-run personal advisory service answering citizens' and
businesses' queries (by phone or online) about their EU rights in the Single Market,
clarification on EU law in the citizen’s and business's particular situation, explanations of how
to exercise these rights, and directions to a national institution or other body if needed. ‘Your
Europe Advice’ relies on a network more than 63 independent multilingual legal experts from
all EU Member States who handle enquiries in all official EU languages. Replies are provided
within less than one week and in any official EU language.
The number of enquires has been increasing over the time.162
Between 2009 and 2016 the
number of enquiries more than doubled (from 11540 to 24445 cases per year). Between 2015
and 2016 the use of Your Europe Advice slightly decreased which can be attributed to more
relevant and more user-friendly information on the Your Europe website.
The timeliness and quality of replies is being maintained even though the questions put to
Your Europe Advice are increasingly specific and complex. 163
The demand for advice is continuously the highest among employed and in the 25-44 age
bracket. In 2016, 38 % of the enquiries were submitted by employed, 11 % by jobseekers and
unemployed, 10 % by self-employed and 8 % by retired and same pattern can be observed in
the past.164
In terms of age, the second place in number of requests goes to the age group 45-
64, while there is a big increase in the number of requests of people under 18 years.
The top enquires relate to the areas of social security, entry procedures, residence, work,
motor-vehicles and taxes (Table).165
The area of social security has been continuously the
161
http://europa.eu/youreurope/advice/
162
Single Market Scoreboard, Edition 07/2017.
http://ec.europa.eu/internal_market/scoreboard/performance_by_governance_tool/youreurope_advice/index_en.htm
163
Single Market Scoreboard, Edition 07/2017.
http://ec.europa.eu/internal_market/scoreboard/performance_by_governance_tool/youreurope_advice/index_en.htm
164
For one fifth of the enquires the information about their status was not available.
165
Topics covered under YEA are: access to document, entry procedures, family rights and issues (other than rights of
residence), financial services, goods (other than motor vehicles), judicial rights in the EU, motor-vehicles, other consumer
issues, other fundamental rights in the EU (incl. Charter), political rights of EU citizens, residence, social security, studies
and training, taxes, welfare benefits (non contributory), work.
136
top one. Around 20% of the enquiries related to social security issues concern forms (i.e.
PDs), notably in the sectors of health and unemployment.166
Table: Your Europe Advice - Top subject areas where advice is soughta
(% of total
enquires)
TOPIC 2013 2014 2015 2016
Social security 24.86 26.04 25.95 23.52
Entry procedures 13.13 13.68 17.85 19.29
Residence 18.07 16.97 16.35 17.35
Work 10.16 9.13 8.57 8.07
Motor-vehicles 8.97 10.93 9.72 7.25
Taxes 5.06 6.16 5.4 6.85
Note: a
Share of enquiries higher than 6 %. For other topics the share if .
Source: Single Market Scoreboard, Edition 07/2017.
7.2. Users' satisfaction with advice
Users are overall satisfied with the quality of the replies. In total 80% are satisfied or very
satisfied with the service received. Satisfaction was somewhat lower for enquiries related
to tax and social security issues, mostly for lack of practical guidance, insufficient
explanations of the relevant legislation and incomplete answers provided.167
On average
one sixth of all YEA users feel that the service did not fully meet their needs, mostly due to
incomplete answers, unhelpful answers and replies that do not contain enough practical
guidance. The data gathered suggest that the citizens who submitted enquiries that were
ineligible for the service could be better informed about the reasons why their case was
rejected.
The YEA service is not easy to find, but this is intentional. Due to the budgetary limits to
the total number of queries that can be handled in a year, the service is not actively promoted.
The costs of providing a personalised, individual assistance via Your Europe Advice are
estimated at € 74 per enquiry, which is 75 times more compared to the costs of providing
information online (e.g. Your Europe, € 0,92 per enquiry). Therefore the reach of the service
is limited considering the number of EU citizens who may require personalised legal advice
and assistance on their EU rights.168
166
Feasibility study on a European Mobility Portal on Social Security (EMPSS), 2017, prepared for DG EMPL by COWI
A/S (not published)
167
IA SDG 2017, p. 42
168
The costs of information provided online via Your Europe are significantly lower (information online, EUR 0,92 per
enquiry) compared to the personalised advise via Your Europe Advice (individual assistance, EUR 74 per enquiry).IA SDG
2017, p. 42
137
7.3. Overview of main difficulties in receiving necessary and correct information in the
area of social security and work
Since 2012, YEA Quarterly Feedback Reports169
provides an overview of the main problem
issues and 'problem countries'.
Social security touches upon health and financial concerns that are perceived as crucial by
citizens. A lot of questions evidence the difficulties that citizens experience in receiving
information. The social security rules are still not well known by the national authorities,
particularly those rules concerning determination of the applicable legislation or the
competent Member State. There is a persistent lack of co-operation between national
authorities despite the obligation of co-operation imposed by Article 76 of Regulation (EC)
No. 883/2004 and number of cases featuring incorrect interpretation or implementation of the
rules by national authorities. Due to their failure to communicate and co-operate with each
other as they should (Article 76, Regulation (EC) No. 883/2004), national authorities are
unable to correctly determine the competent state. Consequently, citizens face problems in
claiming social benefits. This leads to serious problems in all branches of social security as
citizens do not know where to pay social contributions when they work in two countries, or
when they live in one country and work in another, or when they retire to another country.
Under topic 'work' many cases general information requests on the rights, conditions and
formalities of working in another Member State (e.g. access to employment). Similarly the
majority of enquiries received from cross-border workers and posted workers were general
information requests.
The recurrent issues identified in the area of social security and work are the following:
1) Social security
 difficulties in obtaining information, especially concerning the necessary documents
and forms,
 imperfect understanding of the social security rules by national authorities, in
particular, how to determine the applicable legislation or the competent Member
State. Some Member States deny their responsibility and declare themselves as not
competent when they are competent. More and more countries refuse to deliver the
appropriate forms, mostly Form S1 and refuse to recognise those coming from
another EU country (especially Romania, Bulgaria, Sweden, Germany and France).
 There is a persistent lack of cooperation between national authorities despite the
obligation of cooperation imposed by Article 76 of Regulation (EC) No. 883/2004.
169
Only available internally for the Commission.
138
 Excessive delays in processing family benefit claims and the payments of these
benefits (Germany, Austria).
 Difficulties in providing evidence on health insurance in relation to the right of
residence and implementation of Directive 2004/38/EC.170
While this can be
demonstrated by several means, some Member States refuse to recognise any
form other than the Form S1. They refuse to accept an insurance policy or any other
statement or form proving that a citizen is covered by health insurance. YEA received
enquiries showing that an increasing number of Member States refuse to issue
Form S1. This is a recurring issue in Sweden, but it is also appearing in other Member
States such as Romania. The French Family Allocations Office (Caisse d’Allocations
Familiales - CAF) requires that EU citizens have a residence card to continue
receiving benefits.
 The Romanian authorities do not recognize proof of health insurance
contributions in another Member State (such as the Form S1). Citizens are not
even asked to prove that they were subject to another Member State’s social security
system. The Romanian authorities do not accept portable documents issued in other
Member States. In practice, this means that some Romanian citizens are obliged to pay
their health insurance contributions twice. The Romanian authorities do not accept and
often refuse to issue the necessary forms to EU citizens.
 The difficulties that students experience in accessing correct information
concerning their health care coverage. Some Member states will only issue an EHIC
to them while others issue a Form S1. As the Member States have some discretion to
decide the conditions under which they issue a Form S1, this can create difficulties.
 Restricted use of Form A1 in some Member States. For example, citizens have
reported that the authorities in their respective countries have refused to issue Form
A1 to anyone other than an employed posted worker.
 Difficulties experienced by EU citizens caused by the uncertainty of Brexit.
Citizens are now afraid that they will miss out on their pensions even though they have
made contributions. Some local administrations are making registration more
complicated for British citizens and EU citizens living in the United Kingdom are also
experiencing difficulties.
170
The right of residence under the Directive is subject to evidence of health insurance to ensure that citizens do not become
a burden on the social security of the host Member State during their stay.
139
2) Work
 EU citizens and their family members continue to experience difficulties in accessing
work. A residence card or a national insurance number was required (especially in
Sweden and the United Kingdom).
 EU citizens continue to experience difficulties in having their professional
qualifications recognised by other Member States. Surprisingly, very few cases
concerned automatic recognition in the “sectoral” professions.
 Difficulties experienced in relation to application of the Posted Workers Directive
2014/67/EU as well as the Social Security Regulation (EC) No 883/2004.
 A number of enquiries related to obstacles to establish a company or to start a
business
7.4. Cases demonstrating lack of cooperation among national authorities and insufficient
awareness and/or incorrect interpretation of the law in the area of social security
7.4.1 Lack of cooperation between national authorities
Healthcare
Croatia/Germany: A Croatian citizen required unplanned medical treatment in Germany
when temporarily staying there to visit a family member. He had to be hospitalized and
treated in a German hospital. The German health insurer requested Form E112 (now Form
S2), which is the authorisation to obtain planned health treatment from the Croatian health
insurer. The latter refused to issue this document, stating that the citizen was covered by
Croatian health insurance, which will cover all costs approved by the German insurer through
the European health insurance card. The German insurer refused to consider this case as being
one of a citizen seeking unplanned treatment abroad and continues to insist on presentation of
Form E112. This lack of coordination and understanding between the two health insurances
bodies has created a problem for the citizen to receive the treatment he requires in the
knowledge that the cost will correctly be met by the Croatian authorities (228125).
Family benefits
Slovakia/Slovenia: A Slovak national who lives with her family in Slovenia experienced
difficulties in obtaining parental allowance from Slovakia, where she is economically active.
The two administrations cannot agree on the comparability of benefits (228313).
Unemployment benefits
140
Italy/France: An Italian job-seeker who used Form U2171
to have his unemployment benefit
transferred to France was not advised why the first monthly payment and the third were much
lower than the second. As a consequence, he is unsure whether he can extend his job-search in
France. He was advised that he would be granted an extension of payment of his
unemployment benefit to France, but he risks losing his right to benefit if he does not now
return to Italy. The Italian Social Welfare Institution (Instituto Nazionale Providenza Sociale
“INPS”) has failed to respond to the French Job centre (Pôle Emploi) to confirm extension of
the transfer of his unemployment benefit (223898).
Italy/Hungary: A Hungarian citizen worked in Italy. After becoming unemployed, she
registered as a jobseeker with the Italian employment service. She informed the service about
her intention to look for work in Hungary. She stayed for four weeks in Italy as required
under Regulation (EC) No. 883/2004 then asked the Italian Agency to issue Form U2. The
Italian Agency delayed registration of the citizen as a jobseeker in Italy and did not issue
Form U2. The Italian Agency suggested that the citizen should first return to Hungary and
register as a jobseeker there. The Hungarian Agency should then apply for Form U2 in the
name of the citizen. After the citizen had registered in Hungary, the Hungarian Agency
notified the Italian service, but the Italian service refused to issue any cash benefits to the
citizen because the Hungarian authorities had not sent a request for Form U2. The Hungarian
Agency correctly asserts that the Italian service should have issued Form U2 to the citizen
before she left Italy, when she applied for issue of Form U2 in person. As a result, the citizen
was left without unemployment benefits for the period she stayed in Hungary as a jobseeker
(227408).
Italy/France: An Italian citizen sought to transfer unemployment benefit from France to
Italy. The French Employment Centre issued Form U2. The citizen registered with the
commune employment centre where he resided. However, the employment centre (city of
Benevento) was unaware of how confirm the registration to the French Job centre (Pôle
Emploi) and did not accept the Form U2 form issued in France. Consequently, the Italian
citizen has been unable to transfer and benefit from his French unemployment benefit. Art.
76(4) of Regulation (EC) No. 883/2004 and Art.2(2) of Regulation (EC) No. 987/2009 lay
down the principle of mutual information and cooperation between the competent authorities
of the Member States to ensure correct implementation of the EU social security rules. The
institutions are obliged to provide or exchange, without delay, all data necessary for
establishing and determining the rights and obligations of persons (to whom the basic
Regulation (EC) No. 883/2004 applies). The fact that the Italian social security Agency did
171
141
not communicate with its French counterpart and did not accept the Form U2 form issued in
France, represents misapplication of the principle of cooperation, as laid down in EU
legislation and was solved via Solvit (22308311).
Ireland/Lithuania: No response was received from the competent Irish social security
institution to an enquiry regarding a Lithuanian citizen's unemployment insurance periods in
Ireland (228117).
Romania/Germany: A Romanian citizen made voluntary contributions in Romania for two
and a half years. She is now pregnant. She paid sickness insurance cover on a quarterly basis
in Romania. Such contributions are accepted from non-active citizens. She and her husband
wish to settle in Germany. To register residence there, she is required to participate in the
German public health insurance system. She was advised in Germany to obtain Form E104.
She was refused the Form because she had paid her social insurance contributions quarterly
rather than monthly. The citizen was unable to discuss her situation as the phoneline for
enquiries repeatedly rang out. The citizen is in a very difficult situation because despite
having paid social insurance contributions for the past two and a half years, she is being
denied benefits in Germany because she cannot obtain Form E104 from the Romanian
authorities. She cannot obtain the Form E104 because she paid social insurance contributions
there quarterly rather than monthly. (222944, 222944 and 222676).
Old age and invalidity pension
Bulgaria/Greece: A Bulgarian citizen worked in Greece. On her return to Bulgaria, she
required an urgent operation and was asked to pay three years of health insurance
contributions in Bulgaria by the National Social Security Institute (NSSI). After receiving
invalidity pension in Bulgaria, she requested confirmation of her pension rights in Greece in
2016. By 2017, the Bulgarian citizen still had not received a reply about her pension rights in
Greece. Citizens should not be required to pay double insurance contributions when resident
in another Member State. Responses to enquiries about EU social security coordination
should be received within a reasonable period of time (223252).
France/Romania: A Romanian citizen living in France experienced excessive delays in
obtaining details of his pension rights for the years he had worked in Romania. According to
EU rules, as he has worked in both France and Romania, the competent institution in France
may require its Romanian counterpart to provide information on insurance periods completed
there. Delays in providing such information can deprive citizens of their pension income for
the period of the delay (226810).
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France/Spain: A French pensioner residing in France worked there until 2006. He then
worked in Spain from 2006 to 2016. He sought Form E205 from his French insurer to give to
his Spanish insurer. However, the French insurer has failed to send the form to its Spanish
counterpart. This is an infringement of Article 76 (4) of Regulation (EC) No. 883/2004 which
requires national authorities/bodies to cooperate. (227187).
Sweden/Spain: A Spanish citizen lives in Sweden. He has worked both in Sweden and Spain.
He is retired and has applied for old age benefits. The Spanish authorities have not provided
him with information and his application is being delayed. This suggests that there may be
problems in communication between the national competent authorities (223998).
United Kingdom/Spain: The British social security authorities failed to respond for more
than seven months to an old-age pension application from a Spanish resident made through
the Spanish authorities for aggregation of periods and calculation of contribution records
(226188).
7.4.2 Insufficient awareness and/or incorrect interpretation or implementation of the law
by national Agency
Germany: a German citizen resides in Belgium. Between 2014 and 2016, while residing in
Belgium, she maintained a part-time job there and also commenced working as an
independent consultant in Germany. She paid social insurance contributions to the Belgian
national social security Office (Office National de Sécurité Sociale - ONSS) and social
insurance contributions in respect of her work in Germany to a German social security
agency. The Belgian National Institute for Social Security of the Self-employed (L'Institut
national d'assurances sociales pour travailleurs indépendants - INASTI) is now requesting that
she pays them the social contributions for the work she did in Germany. In fact, INASTI is
correct to claim that the social contributions as an independent consultant should have been
paid in Belgium. Indeed, under Article 13(3) of Regulation (EC) No. 883/2004, when a
person receives a salary from a Member State and works as an independent in another
Member State, she should pay her social contributions in the Member State where she
receives her salary. But INASTI should have first sought reimbursement from the German
social security authorities based on Article 76(4) of Regulation (EC) No. 883/2004 which
provides for cooperation between Member States' bodies. This case demonstrates
unawareness of EU law by INASTI (227659).
France: an Irish posted worker living and working in France with his family experienced
143
difficulties in having his Form A1172
registered by the French competent authorities (Caisse
Primaire d’Assurance Maladie- CPAM). This has resulted in his medical bills mounting to
almost €3,000 over the last 2.5 years which he was required to pay up-front and for which he
has not been compensated (224607, similar case 224599)
Cyprus: An EU national worked and paid social security contributions in Cyprus for nine
consecutive years. She then left for Bulgaria and applied for unemployment benefit there but
did not receive any. Four months later, she returned to Cyprus where she also applied for
unemployment benefit. She later applied for sickness benefit, maternity and a birth allowance
in Cyprus. The Cypriot authorities have refused all her claims, insisting that the Bulgarian
authorities are competent. Pursuant to Regulation (EC) No. 987/2009, where there is a dispute
as to which institution is competent, the person should be provisionally covered in her country
of residence and paid benefits under that legislation until the matter is resolved. The two
institutions must communicate to resolve this issue and decide what is her country of 'habitual
residence (227446).
Spain: There is a recurring problem in the failure by the Spanish authorities to aggregate
contributions173
in the calculation of pension and invalidity pensions. A Spanish citizen
worked for more than twenty years in Germany and nine and a half years in Spain. He applied
for German and Spanish old-age pensions, but his Spanish pension has been refused because
the citizen does not have a minimum of ten years of contributions required for payment even
though he had also worked in Germany for twenty years (224917).
France: A French citizen living in France applied for his pension in France. The French
competent authorities have refused to consider his Luxembourg contributions (223491).
Austria: Recurring complaints that the Austrian tax authorities fail to pay a family allowance
supplement. A Slovak citizen experienced problems claiming family benefits from Austria.
Despite providing all documentation more than six months ago, she is still waiting for a
decision and payment of the benefit. Such long delays breach the citizen’s mobility rights in
the EU (223141).
172
Form A1 confirms that an employee or self-employed person pays social insurance contributions in his or her country and
that they are insured. Consequently, it is not necessary to pay insurance contributions in the country, where he or she is
posted. In some sectors, it is difficult to use this form and some countries limit thescope of form A1 to employed posted
workers when, in fact, it has wider use.
173
Article 6 of Regulation (EC) No 883/2004 recognises the principle of aggregation of periods, which means that
acquisition of the right to receive benefits in one Member State must take into account periods of insurance, employment,
self-employment and residence in another Member State. Some enquiries demonstrate the difficulties that citizens experience
in receiving clear and correct information about aggregation of periods of insurance in different Member States.
144
7.5. Cases demonstrating lack of general information for citizens and/or incorrect
interpretation of the law by the national authorities in the area of work
Certain Member States refused EU jobseekers the right to take up employment because they
lacked resident status or a personal tax number (“personnummer”) (for example(Spain
227971 and Sweden 223362, 225422). However, the authorities would not issue the personal
tax number unless the citizen could demonstrate that they were in employment.
Similar cases are reported in establishing a business. E.g. in Finland, to establish a business, a
person should have a personal number and there is also an obligation to register residence as
an EU citizen. Although these are two separate administrative proceedings and should be able
to be carried out independently of each other, the citizen can easily become confused and feel
in a Catch-22 situation, as it is not possible to carry out one process without having already
completed the other (224012).
Sweden: The Swedish authorities refused to recognise the right of a worker to retain his
status as such. He had worked for approximately three years before becoming unemployed.
Then, he resumed work for approximately a year before becoming unemployed due to
hospitalisation (224523).174
The Netherlands/Portugal: A Portuguese citizen posted in the Netherlands was defrauded
by the temporary work agency which employed him. He was not granted paid annual leave or
an end of year bonus. Moreover, his salary was taxed twice (225153).
Ireland/France: A posted worker could not obtain an extension of his Form A1 because the
French competent body failed to approve it (224599).
Portugal: A posted worker misunderstood his social security contribution obligations while
posted abroad (223395).
7.6. Cases showing a worrying lack of training and preparation among national
authorities
This section present some cases that show a worrying lack of training and preparation among
local authorities in providing correct and clear information about their social security rights to
mobile EU citizens. The cases demonstrate that information from the national authorities
174
Article 7(3) of Directive 2004/38/EC states that EU nationals who have worked in the host Member State for longer than
one year but who have lost their employment involuntarily are allowed to retain their EU worker status and all connected
rights.
145
often contradict each other, individuals are sent from an administration to another and have to
face real difficulties just to have access to basic information. Such cases could be avoided by
national interlocutors being correctly trained on the coordination of the social security system.
Lack of general information
[225092]A Portuguese citizen has residence in Portugal and has the European Health
Insurance Card. She wonders if she can use the EHIC from Portugal in Germany or has to
request an S1 form. She is very confused regarding what covers what. She made researches, it
is impossible to find clear and correct information.
[224497] Interns: The type of social security scheme a Finnish person doing an internship in
Italy should subscribe to is unclear. The citizen does not currently have any social security
coverage because the Finnish authorities insist that an internship constitutes employment, but
the Italian authorities refuse to acknowledge that they are responsible for her social security.
In Italy, special provision is made for certain internships, but this citizen is facing difficulties
in being accepted under this provision. She does not know whether she should fall under the
special provisions for interns in Italy or be treated as a normal employee
Implementation of rules
[227504] Italy: An Italian citizen could not provide the U2 form with the 7 days term to the
Italian employment service because of the conduct held by some officials. YEA assessment
confirmed that the officials did not apply properly the Regulation 883/2004 and advised the
case to be assessed by Solvit office.
Exchange of information and lack of cooperation
[223941] France/Bulgaria: The Bulgarian citizen lives in France and is applying for a
French pension. She has worked in France since 2008 and before that 25 years in Bulgaria.
The French authorities want her to produce the document establishing her insurance periods
in Bulgaria in trimesters otherwise her Bulgarian insurance periods would not be taken into
account and she would be granted a pension of 93 euro. However, given that she lives in
France, the French authorities are responsible for processing her pension application and
collecting information about her pension contributions in Bulgaria using standard E-forms,
and the insurance periods do not have to be in trimesters.
[224136] Italy/Lithuania: A resident of Lithuania has been working in Italy since 2016. She
filed a petition for the "Deprivation of Sanctions for Temporary Compulsory Health Insurance
Contributions" from the Sodra Panevėžys Division, as she has not yet been able to receive
certificates regarding the payment of a PSD abroad in Italy. She contacted the Italian
department of the Palermo INPS and submitted to them an E104 form which has to confirm
that she pays social insurance contributions in Italy. The Italian INPS has not provided her
146
with a certificate, and the Lithuanian SODRA is penalizing her for not paying my
contributions in Lithuania. However, as she is legally employed in Italy, she is not obliged to
pay compulsory health insurance contributions in Lithuania but has to provide upon request to
tax administrator a document, which confirms that she insured in another country. This
document can be obtained also directly by the competent Lithuanian institution – Social
Insurance Fund Board – from the competent Italian institution – Istituto Nazionale Previdenza
Sociale (INPS).
[227518] Bulgaria/United Kingdom/Portugal: Two years ago the citizen applied for a
pension in Bulgaria. As he had worked in the UK and in Portugal, the Bulgarian pension
institution requested information from the Portuguese and the British pension authorities.
Neither has responded yet. As a result, the citizen is without a pension. Delaying the exchange
of information and the decision on his pension for some 2 years is not compatible with the
principle of good administration laid down in Article 76 of Regulation 883/2004.
8. SOLVIT
The cases submitted to SOLVIT in the area of social security in the last three years are as
follows:
Row Labels 2015 2016 2017
SOCIAL SECURITY cases in SOLVIT
Family benefits 534 764 373
Old-age benefits 189 211 237
Unemployment benefits 229 205 190
Other 64 87 80
Sickness benefits 76 65 74
Necessary healthcare abroad and the European Health Insurance Card
(EHIC) 84 64 50
Invalidity benefits 54 40 46
Survivors' benefits 25 34 36
Maternity and equivalent paternity benefits 22 20 33
Benefits in respect of work accidents and occupational diseases 7 6 5
147
Death grants 5 4 3
Pre-retirement benefits 1 3 3
Planned treatment 9 4 2
Grand Total 1299 1507 1132
Furthermore SOLVIT has handled in the same period the following number of cases in the
area of free movement of workers:
3. FREE MOVEMENT OF WORKERS Total
Other 13 10 10 33
Access to employment (access to labour market, access to posts, e.g.
recruitment procedures) 9 12 8 29
Employment related rights (working conditions, such as salary and grade;
recognition of professional experience and seniority) 13 9 7 29
Posting of workers 6 3 3 12
Grand Total 41 34 28 103
Another valuable source of information is the problem cause of SOLVIT cases. Looking at
the more than 4000 cases of the last three years, the picture is as follows:
Row Labels %
Real
numbers
1. Structural problems due to lack of/inappropriate transposition of EU law 0.5% 20
2. Structural problem due to a national rule conflicting with EU law (mostly legislation
and written instructions) 1.0% 42
3. Recurrent misapplications of EU law (is the same as administrative practice) and/or
national law (without national written rule)
19.4
% 782
4. Individual (a one-off) misapplication of EU law and/or national law (national law
that has implemented EU law)
42.3
% 1709
5. Clarification case (no misapplication or absence of EU law)
36.8
1488
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%
Grand Total
100.
0% 4041
1.5% of the cases were marked as being of structural nature, whereas most cases were either
individual misapplications (42%) of an Agency or cases which turned out to be no
misapplication (37%).
9. SME feedback database
10.1 Introduction
The "SME feedback database" is a register of practical problems with EU legislation
experienced by SMEs. Enterprise Europe Network (EEN) partners - during their interaction
with a client SME - identify problems encountered by the company in the Single Market. The
EEN partners' role is on one hand to propose a solution to the SME and on the other hand to
make the problem known to the European Commission.
Around 6% of all cases in the period 2006-2015 were related to employment and social affairs
(including free movement of workers) (502 out of 8182), with the number of requests
declining over the time. The highest number of cases is related to the mobility issues (see
table).
Table: Cases related to employment and social affair, per sub-area, 2006-2015
Sub-areas 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
*
Mobility (free movement of workers,
co-ordination and transferability of
social rights, professional recognition,
posting of workers)
93 77 27 36 46 15 18 14 8 3
Social security schemes 9 9 4 5 11 2 3 2 1
Health & Safety at work 6 10 3 4 6 1 3 2
Other 13 12 2 8 8 1 3 3
Corporate Social Responsibility aspects 2 1 1
No reference (blanks) 6 9 1 4 3 1 3 3
Total 127 119 37 57 74 20 31 18 16 3
Note: *only cases until mid-2015.
National requirements that prevent correct functioning of the internal market, severe
difficulties in finding information and wrong interpretations at national level of a European
text are among key problems identified by companies (table ) and the top solution for many of
those problems if making information more accessible (table)
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Table: Cases reported in the area of employment and social affairs by key problems
encountered by the companies (2006-2015)
Problem
Is the case related to
cross-border activities?
Yes No
National requirements in a cross border activity avoid correct functioning of
the Internal Market
166 11
Others 80 37
Severe difficulties to find European information needed to carry out the
activity.
69 19
Wrong interpretation at national level of a European text 34 20
Lack of detail in the text of the European legislation/programme 31 12
The wording of the European legislation/programme or the procedure
negatively affects in particular SMEs
15 11
Total 395 107
Note: a
The problem could be attributed to several categories, but only one can be selected, i.e. the one
considered to be the most relevant. Many cases on national requirements are closely related also to the lack of
information. b
Cases are considered to be related to cross-border activities if they include activities like selling or
buying goods, delivery of services, establishing in other country
Table: Cases reported in the area of employment and social affairs by key solutions
identified by the EEN correspondent (2006-2015)
Is the case related to
cross-border activities?
Yes No
Making available the information through more accessible means (internet, in
the language of the SME, etc)
98 19
A more homogeneous interpretation of EU rule/programme across Europe
(national responsibility)
83 18
Modifying the national legislation implementing EU rules/programme in a
certain countr
81 27
Modifying and better adapting the EU programme/legislation to SMEs
characteristics
53 17
Others 50 20
Providing more detailed information on implementing rules in the EU
rule/programme (EU responsibility)
30 6
Total 395 107
Note: a
The solutions could be attributed to several categories, but only one can be selected, i.e. the one
considered to be the most relevant. b
Cases are considered to be related to cross-border activities if they include
activities like selling or buying goods, delivery of services, establishing in other country
The sections below present a selection of cases demonstrating the problems that companies
are facing and where the Authority could be helpful in providing support services/advice to
businesses and by capacity building activities to ensure correct interpretation at national level
of a European text.
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10.2 Cross-border cases showing lack of accessible information
[2015, 083930510271007715] France/Denmark French company wanted to provide
temporary services in Denmark. It found a lot of information on the Danish point of single
contact website but had the highest difficulties to know for sure the minimum wage he will
have to respect for his posted employees. As there is no general minimum wage in Denmark
the EEN needed to identify which collective agreement to apply and the competent Union for
this agreement. It is estimated that up to one month was lost in order to find the information.
As the points of single contact are developing ready to use websites, the same layout would
be really helpful to find the information. The first step in avoiding social dumping is to
communicate clearly on the minimum wages to apply and for companies to have access to the
information free of charge.
(2015) Czech republic/Italy The Czech company wanted to provide guarding services
(surveillance of the service centre) during a cyclocross race in Riva Del Garda in Italy for
about a week through posting of their workers. It received only partial information from local
administration and they wanted to be sure to come in Italy following the proper procedures.
Not knowing the Italian legislation on posting of workers with the precise framework of
application (maximum working time and minimum rest periods; minimum period of paid
annual leave; minimum wages, included the overtime; temporary transfer of workers
conditions, in particular the supply of temporary workers by temporary employment agencies;
safety, health and hyhygiene at work; equal treatment between men and women and other
provisions against discrimination) created a problem in planning the provision of services. In
addition there is also a national contract regulating the provision of security services which
should be known. An easily reacheable information (e.g. in English) could have created less
difficulties to the company. At the end the client decided not to provide this service in Italy.
[2014, [824615434011435000] United Kingdom/Germany The UK company wanted to
employ a German to do the marketing and sales on the German market for them. They were
informed that he had am employee restraint of trade so could not be hired immediately by
them. The UK company did not know these regulation from their country of origin, doubted
that this was legal and needed to get information on the legal framework on this and lost time
in finding information on that. Though freedom of workers/ employees is a well-known thing
to companies, there are special circumstances that are tricky for the companies. This problem
was solved through the cooperation of the EEN partners and EEN correspondents consider
that the EURES offices could be helpful in cases like this as well.
(2013) 622560015461513513 France/several other countries The main activity of the
French company is to organize theatre pieces and other recreational artistic activities at the
occasion of bigger events. They work with French artists as they have the special know-how
in street art theatre. This company has international clients from Belgium, Luxembourg,
United Kingdom, Germany and even Quatar, but has difficulties in finding information about
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formalities to follow, notably in the UK, like how to declare taxes, do the artists need special
authorizations or other work permits to go to perform in other countries, how to declare their
salaries and what contracts to sign. The company lost time spent on research for formalities
and their legal and administrative obligations. There is a competent person on this subject in
South West of France, but the delays for the answer were very long, so that my company has
lost time with their clients.
2013 [656826520541401713] Slovakia/Germany The Slovak company specialized in
assembling/ disassembling tent structures at events like festivals or concerts wanted to
provide services in Germany. It had heard that under certain circumstances they had to pay
money to a German social security scheme, even though they were in Germany only for little
time of the year. In order to act according to the rules it wanted to know a) if that was really
the case and b) if yes, how that scheme works but couldn't find the information. The EEN
correspondent considers that the availability of information in the respective national
language is a general problem, especially for small companies, when providing their services
in other countries or when trying to bid for a public tender abroad.
2012 (223049303271835512 France/Spain
A French company wants to recrute a Spanish national, living in Spain, as an employee to
work in Spain. The company is not established in Spain and does not want to set up a legal
structure there. The French company tries to find out about the procedure to follow in this
specific case with regard to paying social security contributions. The company finds it
difficult to obtain the information while in France a brochre exists that explains such specific
recrutements by companies that are not established in France. The company cannot find ou
how to recrute an employeee in Spain without being established there and this difficulty
delays the recrutement of its Spanish employee.
It would have been preferrable that the recrutement procedures of employees in countries
where the recruting company is not established could have been found on the EURES
website. i
2012 [728516943201135212] Italy/France The Italian enterprise wanted to know which is
the regulatory framework in area of health and safety at work in France it should comply with
if it builds a private housing estate (for example the construction foreman’s duties). The
problem caused a loss of time because the Italian company had to make a research from
various French sources, without finding out the solution. It contacted the EEN because it
wasn’t able to find correct information due to language and bureaucratic problems. The EEN
correspondent suggests that these kind of problems could have been avoided by making
available - for instance through the European information network - some practical summary
report or technical guidance to all operators; on the second hand these kind of problem could
have been avoided making available an on-line platform for sharing information.
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2012 710281916141234812 Italy/Portugal The Italian company could not find information
related to labour law and social obligations for Portugal, with particular reference to the
service and multiservice sector. In Italy, some collective workers’ agreement in specific
sectors (among which collective agreement for services and multiservice – such as cleaning
service) sets that in case a new provider of service takes over the duties of a former provider
(signing a contract between private parties) he is obliged to hire all the employees of the
former’s provider which was providing that service. The Italian enterprise wanted to know if
the same regulatory framework applies in Portugal. The problem caused a loss of time
because the Italian company had to make a research from various Portuguese sources, without
finding out the solution. It contacted EEN because it wasn’t able to find correct information
due to language and bureaucratic problems. The EEN correspondent suggested that the
problem could have been solved by providing basic information on EU website, for example
by translating into a common language (English) the relevant measures put in place by each
EU Member State. Besides it, by means of more resources (e.g. to be assigned to the
Enterprise Europe Network) an expertise service for supporting and assisting companies on
the subject could be activated (i.e. fact sheets on labour market).
10.3 Cross-border cases showing wrong interpretation at national level of a European
text
[2014] 180468336321621714 France/Greece Entrepreneur of Greek origin worked over his
entire career in France and moved to Greece after retirement.
The case concerns a businessman of Greek original having lived and worked for over 30 years
in France. Upon taking retirement and complying with a number of administrative obligations
in Greece for having sold his company, he was confronted with a demand from the Greek
social security office for the self-employed to pay social security contributions. This occured
despite the fact that he had never been self-employed in Greece and all social security
contributions as an entrepreneur had been correctly paid in France. He tried to explain the
situation to the Greek authorities, including on the basis of French documents providing proof
that social security contributions had been duly paid in France, but to no avail.
A better coordination between national authorities, possibly through an interlocutor with
access to information on the systems in different Member States and charged with cross-
border cases could have prevented loss of over 6 months and insecurity.
2014 110987524581120214 Germany/Belgium The owner of a German craft business
(installation of finished building parts) moved to Belgium for private reasons in 2005. In
order to be able to work in Belgium he applied for the VAT-number in Belgium. The owner is
registered for social security in Germany. He sent a proof of insurance to the Belgian
authorities. Nevertheless he received a letter from the INASTI in Brussels every year in which
the authorities claim the payment of social insurance. The German owner charged task
advisers and lawyers with he clarification of the situation, without success and without
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reaction of the INASTI. In May 2014 the INASTI sent a payment notification of 184.985,81 €
via bailiff. Basis for the claims is the Royal Decree no. 38 of July 27th 1967 regarding the
setup of the social status for the self-employed. The German never registered a business in
Belgium. He only lived in Belgium but the craft business remains in Germany.
The request for payment threatened the existence of the company and of the 12 jobs and the
costs/loss was estimated to be more than 50 000 euro. INASTI gave notice to have collected
the amount of 184.985,81 by a bailiff. The case was transferred to SOLVIT and the German
Office of the Chamber of Trade in Brussels.
(2011) French company in Belgium
The applicant wishes to recrute a full-time employee in Belgium even though his company is
not established in that Member State. The appropriate procedure to apply in this case is
known in France as "isolated employee". It is a procedure that is recognized by Community
law and is applicable in all Member States.
The procedure is poorly applied in many Member States. It is difficult to obtain information
and some Member States, for tax reasons, prefer that the European companies concerned
create on their national territory a secondary establishment of subsidiary or branch type.
It is easy to imagine a simplified regime concerning the declaration and the status of these
"isolated employees" in order to facilitate and generalize this form of presence for SMEs in
Member States where these are not established. It would avoid negative social and / or effects
on individual (s) or general public.
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ANNEX 13: EU DECENTRALISED AGENCIES IN THE AREA OF EMPLOYMENT
This Annex presents the objectives and organisation of the four decentralised agencies
operating under the remit of DG Employment, Social Affairs & Inclusion (DG EMPL):
Eurofound, Cedefop, EU-OSHA and ETF175
. A full assessment of four agencies and
evaluation findings will be presented in the separate Commission staff working document on
the evaluation.176
The evaluation of four agencies is a separate process which is done in line with the
Commission's Better Regulation Guidelines and the Financial Regulation requirements for a
periodic evaluation of EU interventions of over 5 million EUR.177
It encompasses both an
individual assessment of each agency as well as a cross-cutting and comparative perspective
for the period 2011-2016, as well as a prospective assessment with regard to the future
functioning of the agencies.
The prime objective of the agencies is to generate knowledge and contribute to the policy
process in their respective fields of activity:
 Cedefop works to promote vocational and of in-service training
 ETF mandate encompasses human capital development
 Eurofound covers broadly living and working conditions
 EU-OSHA focusses its activities on occupational safety and health
The current modus operandi of the agencies is:
 to provide policy advice and assistance to the Commission (Eurofound and Cedefop).
Eurofound is primarily a research and research management institution. Cedefop has a
similar path to Eurofound although, in addition to its EU-level role, it occasionally
engages with policy makers within Member States to provide evidence that has fed into
national policy reforms
 to provide information to the Community bodies, the Member States and social partners
(EU-OSHA), e.g. running communication campaigns to raise awareness about OSH
amongst workers/the general public. This sets it apart from Eurofound whose focus is on
policy-makers.
 to contribute, in the context of EU external relations policies, to improving human capital
development in a number of countries and regions outside the EU (ETF). ETF conducts
175
Eurofound (European Foundation for the Improvement of Living and Working Conditions) is based in Dublin, Ireland;
Cedefop (European Centre for the Development of Vocational Training) is based in Thessaloniki, Greece: EU-OSHA
(European Agency for Safety and Health at Work) is based in Bilbao, Spain; and European Training Foundation (ETF)
is based in Florence, Italy.
176
Forthcoming in 2018.
177
The ongoing evaluation is assessing the four agencies as regards their relevance, effectiveness, efficiency, coherence and
EU value-added.
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research and provides advice to the EU partner countries in the Balkans, North Africa,
Central Asia and other regions.
The table below lists the specific objectives of the agencies and presents examples of
corresponding outputs (Table 1).
Table 1. Specific objectives, activities and outputs of the agencies
Specific objectives Activities Examples of outputs
Cedefop  Contributing to continuous renewal
and reform of VET to recover from
the economic crisis and ensure long-
term growth and prosperity
 Support to policies that help people
pursue adult and work-based
learning assisting their career
transitions, and enterprises and
sectors facing change and increased
competition
 Systematic consideration and
anticipation of external drivers
which influence knowledge, skills
and competence needs and produce
implications for VET
 Monitoring
 Research
 Support
 Communication and
dissemination
 VET in Europe country
reports, national news on
VET, European mobility
scoreboard for initial
vocational education and
training
 Project Apprenticeships in
work-based learning,
European guidelines for
validating non-formal and
informal learning
 Project Assisting EU
countries in skills matching,
Trends and skill needs in
tourism, EU Skills Panorama
Eurofound  Providing policy-relevant
knowledge for increasing labour
market participation and combating
unemployment – by creating jobs,
improving labour market
functioning and promoting
integration
 Supporting policy-makers with
evidence in the field of working
conditions and sustainable work
 Monitoring trends and
developments in industrial relations
 Conducting research for improving
standards of living and promoting
social cohesion in the face of
economic disparities and social
inequalities
 Monitoring
 Research
 Communication and
dissemination
 European Company Survey,
follow-up reports
 European Working
Conditions Survey, follow-
up reports
 Mapping key dimensions of
industrial relations in Europe
 European Quality of Life
Survey; report Delivering
public services: a greater role
for the private sector?
EU-OSHA  Promoting cooperation among MS
and stakeholders to make the best
use of OSH resources
 Generating and high-quality
knowledge on OSH new and
emerging risks, their health effects
and prevention
 Raising awareness of OSH risks and
their prevention
 Making knowledge and good
practices accessible for those
involved in OSH and stimulating
dialogue on different levels
 Developing
forecasting
information
 Generating and
maintaining
information on
working
environment
 Promoting
networking and
coordination
 Communicating and
raising awareness
 Campaign toolkit
 European Survey of
Enterprises on New and
Emerging Risks
 OSH wiki, Napo
 OSH e-tools, E-guide on
vehicle safety, E–guide for
all ages
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ETF  Governance, systems and policy-
making
 VET provision and quality
assurance
 Qualifications and qualifications
systems
 Entrepreneurial learning and
enterprise skills
 Labour market information systems
and skills of employability
 Provision of
information, policy
analysis and advice
 Support in capacity
building
 Knowledge
dissemination and
networking
 Provision of
expertise in EC
project and
programming cycle
 VET Governance partner
country profiles
 Torino process reports
 Project Qualifications for the
Mediterranean
 Entrepreneurship
competence framework
 Country reports education,
training and employment
developments
Source: Evaluation report of four agencies, forthcoming 2018