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Employment and Social Policy

Outline of the Community (European Union) legislation about Employment and social policy

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These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Employment and social policy

European society is changing, influenced by different factors such as technological progress, the globalisation of trade and an ageing population. European employment, social affairs and equal opportunities policies contribute to improving people’s living conditions with a view to sustainable growth and greater social cohesion. The European Union (EU) plays the role of a trigger in social change. It has introduced a protective legal framework for European citizens. It fosters the cooperation of Member States, the coordination and harmonisation of national policies, and the participation of local authorities, unions, employers’ organisations and other stakeholders involved.

The priority aims of this policy are to increase employment and worker mobility, to improve the quality of jobs and, working conditions, to inform and consult workers, to combat poverty and social exclusion, to promote equality between men and women, and to modernise social protection systems.

Employment and social policy Contents

European Strategy for Growth: Europe 2020 Strategy, Intelligent growth, Sustainable growth, Inclusive growth
Priorities and objectives: the social agenda:Social agenda
Community employment policies: Partnership for growth and employment, Legal instruments for Community employment policies, Skills and mobility, Quality of employment
Social and employment situation in europe: Reports, Statistics
Job creation measures: General job creation measures, Promoting employment at a local level, Sectoral job creation promotion
Employment rights and work organisation: Protection of employee’s rights, Organisation of working time, Corporate social responsibility
Social dialogue and employee participation: Cross-industry social dialogue, Sectoral social dialogue, Information, consultation and participation of employees
Health, hygiene and safety at work: Equipment, signs and loads, Protection of specific groups of workers, The workplace, Chemical, physical and biological agents
Social protection: Coordination of social security regimes, Supplementary pension schemes, Modernising social protection
Equality between men and women: Gender mainstreaming, Female employment and entrepreneurship, Combating sexual harassment and violence against women
Social measures for target groups: disability and old age: Equal opportunities, Rights and dignity of handicapped persons, Pensions and healthcare for the elderly, Demographic changes
Social inclusion and the fight against poverty: Combating social exclusion, Social protection and the fight against poverty
Anti-discrimination and relations with civil society: Combating discrimination, Fundemental social rights, Relations with civil society
Employment and social policy: international dimension and enlargement: Social development, Measures aimed at target groups, Enlargement

European Youth Pact

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European Youth Pact

Outline of the Community (European Union) legislation about European Youth Pact

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Education training youth sport > Youth

European Youth Pact

Document or Iniciative

Commission Communication of 30 May 2005 on European policies concerning youth: Addressing the concerns of young people in Europe – implementing the European Youth Pact and promoting active citizenship [COM(2005) 206 final – Not published in the Official Journal].

Summary

The Communication draws attention to the three strands of the Pact adopted by the European Council in March 2005:

employment, integration and social advancement;
education, training and mobility;
reconciliation of family life and working life.

The measures to be taken in these three areas will have to be fully incorporated into the revised Lisbon Strategy, the European Employment Strategy, the Social Inclusion Strategy and the ” Education and Training 2010 ” work programme.

For the purpose of implementing the different measures, the Member States will draw on the “integrated guidelines for growth and employment”, within the framework of the Lisbon Strategy.

The Commission’s text highlights the aspects of the integrated guidelines and the Community Lisbon programme that are relevant to the Pact.

Measures for the employment, integration and social advancement of young people

The following guidelines have the most relevance for young people:

promotion of a life-cycle approach to work (entailing, inter alia, renewed efforts to build employment pathways for young people and to reduce youth unemployment, in tandem with resolute action to eliminate gender gaps in employment, unemployment and pay);
creation of inclusive labour markets for job-seekers and disadvantaged people;
improvement in the matching of labour market needs;
expansion of investment in human capital;
adjustment of education and training systems in response to new skills requirements.

The Member States will receive financial assistance from the European Social Fund and the European Investment Bank for implementing the necessary measures. The Commission wants the Member States to devise tailor-made action plans providing job search assistance, guidance services and training. The Communication also proposes that:

the Commission and the Member States give priority to young people in the mutual learning programme on employment in 2005;
the Commission and the Member States, through the Social Inclusion Strategy, improve the situation of the most vulnerable young people;
the Commission launch a study on the social integration of highly disadvantaged young people in 2005.

Measures for education, training and mobility

The priorities are:

reducing the number of early school leavers;
widening access to vocational, secondary and higher education, including apprenticeships and entrepreneurship training;
defining common frameworks to make qualification systems more transparent;
tackling the validation of non-formal and informal learning;
implementing the Europass decision;
developing a “Youthpass”.

The Commission intends, during 2005 and 2006, to:

adopt a Communication on entrepreneurship education;
propose a European Qualifications Framework;
adopt a Recommendation on key competences.

The Communication looks at ways of enhancing young people’s mobility, highlighting a number of initiatives:

in 2006, the European Year of Worker Mobility, specific initiatives will be taken for the benefit of young people entering the job market;
from 2007, there will be follow-up to the 2002-05 action plan of the Commission and the Member States for skills and mobility;
the Member States will be asked to boost implementation of the Recommendation on the mobility of students, persons undergoing training, volunteers, teachers and trainers;
the Commission will adapt tools such as EURES and PLOTEUS with a view to enhancing the opportunities for young people to work and study abroad;
the Commission will, in 2005, make recommendations on a mobility card for young people in Europe;
the Commission will think about extending the “Working holidays” initiative;
the Commission and the Member States will, in 2007, implement new forms of European Voluntary Service.

Measures for reconciling family life and working life

The Communication makes it clear that a better balance is needed between work and family life in order to tackle the problems associated with demographic ageing and a low birth rate. With a view to better reconciling family and working life, the Commission will encourage:

the Member States to make provision for quality accessible and affordable childcare facilities and care for other dependants;
the Member States, assisted by the Commission, to develop new forms of work organisation, such as flexitime, tele-working, maternity and parental leave.

Following on from the Green Paper on Europe’s changing demographics, the Commission has launched a process of consultation with the aim of identifying policies to be pursued or reinforced at European and national levels.

THE ACTIVE CITIZENSHIP OF YOUNG PEOPLE

The citizenship of young people is a focal point of the open method of coordination. With a view to improving participation, information, voluntary activities and knowledge of youth issues, the Council adopted 14 common objectives in 2003 and 2004. In its Communication of October 2004 [COM(2004) 694 final], the Commission gave a positive evaluation of the activities conducted at European level, while stressing the need for suitable measures at national level to consolidate the common objectives.

The Pact and associated actions ought to give rise to better understanding and greater knowledge of youth in the areas concerned, namely:

employment;
integration and inclusion;
entrepreneurship;
mobility;
recognition of youth work.

THE YOUTH DIMENSION IN OTHER POLICIES

The Communication draws attention to other policies which are relevant to young people:

since 2005, the European campaign “For Diversity – Against Discrimination” has been extended to young people;
a European initiative for the health of children and young people is planned for 2006;
studies focusing specifically on youth will be undertaken as part of the Sixth Research Framework Programme;
the Seventh Research Framework Programme will include youth-related research, which could focus on the impact of young people’s participation in representative democracy and voluntary activities;
the Commission will launch, in 2005, a public consultation on sport.

SUPPORT PROGRAMME

Policy actions targeting young people should be accompanied by programmes supporting projects that encourage young people to become active citizens. Various European programmes support such projects:

European Social Fund;
European Regional Development Fund;
Rural Development Fund;
” Youth ” and “Youth in Action”;
Integrated Lifelong Learning Programme;
” Citizens for Europe “;
Competitiveness and Innovation Framework Programme;
Marie Curie Programme;
European Science Education Initiative.

INVOLVEMENT OF YOUNG PEOPLE

As far as the Pact itself is concerned, the European Council has emphasised the need to consult young people and their organisations both on the development of national reform programmes for the Lisbon Strategy and on follow-up action. National youth councils should, in any event, be among those consulted.

The Commission also intends to consult young people and the European Youth Forum on youth policy. This consultation process will culminate in the holding of a Youth Assembly in 2005. In addition, the Commission hopes that this assembly will be a precursor of “annual encounters” between young people and Commissioners.

BACKGROUND

This Communication builds on the European Youth Pact adopted by the Heads of State or Government during the European Council of March 2005.

Adoption of the Pact coincides with the completion of the first cycle of implementing the White Paper on a new impetus for European youth, published in 2001.

Related Acts

Resolution of the Council of 24 November 2005 on addressing the concerns of young people in Europe — implementing the European Pact for Youth and promoting active citizenship[Official Journal C 292/5 of 24.11.2005]
The Council invites the Member States to develop structured dialogue with young people and their organisations at national, regional and local level on policy actions affecting them, with the involvement of researchers in the youth field. It calls on the Member States and the Commission to:

encourage the recognition of non-formal and informal learning, for example through developing a “Youthpass” and considering its inclusion in Europass, and consider the validation of such learning;
identify obstacles to and exchange, develop and apply good practice concerning young people’s mobility in order to make it easier for them to work, volunteer, train and study throughout the European Union and further afield;
evaluate the framework for European cooperation in the youth field in 2009.

Conclusions of the Council Presidency at the end of the European Council meeting on 22 and 23 March 2005

The European Council called on the Member states, within the framework of the European Employment Strategy and the Social Inclusion Strategy, to improve the education, training, mobility, vocational integration and social inclusion of young people, while facilitating the reconciliation of working life and family life.

The Pact should ensure the overall consistency of initiatives to be taken in these different areas. Its success depends on the involvement of all parties concerned, first and foremost youth organisations.

Framework for promoting employee financial participation

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Framework for promoting employee financial participation

Outline of the Community (European Union) legislation about Framework for promoting employee financial participation

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Employment and social policy > Social dialogue and employee participation

Framework for promoting employee financial participation

Document or Iniciative

Commission Communication of 5 July 2002, framework for the promotion of employee financial participation [COM(2002) 364 final – Not published in the Official Journal].

Summary

At the Lisbon Summit, the Union set itself the goal of “becoming the most competitive and dynamic knowledge-based economy in the world, capable of sustainable economic growth with more and better jobs and greater social cohesion”. Employee participation can make a significant contribution to realising this aim. If it is handled properly, it can not only increase companies’ productivity, competitiveness and profitability but also encourage employee participation, increase the quality of employment and contribute to greater social cohesion.

The positive results that financial participation schemes for employees have produced in many countries certainly have some bearing on the fact that this question has become a Union-wide political priority. Moreover, an increasing number of enterprises have started to become aware of the possibilities offered by such schemes, i.e. motivating employees and aligning their interests with those of the shareholders, and also recruiting and keeping staff. Employee participation in profits and enterprise results therefore goes hand in hand with a certain number of advantages for enterprises, employees and the economy as a whole.

Forms of financial participation

Financial participation of employees in the profits and results of the enterprise may take many different forms. The common element – and their main characteristic – lies in the fact that they are intended to give employees, usually all employees, access to the enterprise’s profits and/or results.

The PEPPER reports (PEPPER I and PEPPER II) on promoting employee participation in profits and enterprise results and Council Recommendation 92/443/EEC divided the types of financial participation schemes into two main categories:

participation in profits, i.e., sharing of profits between those providing the capital and those providing the labour by giving employees a variable income, in addition to their fixed pay, linked with the profits or another measure of the enterprise’s results.
employee shareholding, which offers employees indirect participation in the enterprise’s results in the form of dividends and/or appreciation of the value of the capital they hold.

This communication deals with the following main aspects of employee financial participation:

the general principles;
transnational obstacles;
promotion of more widespread financial participation.

General principles

A review of the various forms of financial participation has shown how different the schemes are. Nevertheless, there are some essential elements and principles which characterise the majority of the schemes and the Member States’ policies.

The general principles defined in this communication may serve as a benchmark for identifying good practice;

voluntary participation: schemes for financial participation must be set up to respond to the real needs and interests of all the parties concerned and should not therefore be imposed;
the advantages of financial participation should be extended to all employees: some of the main advantages of financial participation are that employees identify more with the enterprise and it creates a sense of belonging and increases their motivation;
clarity and transparency: the financial participation schemes must enable employees to fully weigh up the risks and potential advantages of the scheme;
predefined formula: the rules on financial participation in companies must be based on a predefined formula and clearly linked to the enterprise’s results. This is vital to guarantee the transparency of such schemes;
regularity: these financial participation schemes must be applied regularly (this is important as the schemes are intended to reinforce and reward sustained loyalty on the part of employees);
any unreasonable risk for employees should be avoided: compared with other “investors”, employees generally bear the brunt of any economic problems their company runs into. This being so, it is important to take care to prevent any risks in setting up and managing the financial participation scheme;
a distinction should be made between pay and income from financial participation schemes;
compatibility with employee mobility: financial participation schemes must be set up so as to be compatible with employee mobility, both at international level and between companies.

Transnational obstacles

Differences in tax systems, social security contributions and the general legal framework or even cultural differences frequently make it impossible for enterprises to devise and apply a joint financial participation scheme in various places in Europe.

The main transnational obstacles are as follows:

differences in tax systems, which can raise problems on two fronts: double taxation or no taxation and substantial administrative costs for enterprises wishing to set up financial participation schemes in various countries;
the level of social security contributions, which can vary from one country to another and sometime discourages enterprises from extending financial participation schemes to certain countries;
national differences in law which can delay the introduction of financial participation at transnational level;
cultural differences and diverging views on financial participation, different national traditions or differences in social relations;
a lack of mutual recognition of financial participation schemes;
lack of information on financial participation schemes and policies in favour of existing financial participation.

How to promote financial participation

In order to increase employee financial participation in profits and enterprise results in Europe, the Member States have to pursue and intensify their efforts to set up a favourable legal and fiscal environment. Furthermore, as the extent to which financial participation has become established varies from one country to another, there is considerable scope for stepping up the exchange of information and experience.

The Commission will promote the exchange of information and good practice by activities such as making comparative assessments of national policies and practices, including financial participation in the peer review programme under the Employment Guidelines or organising national conferences.

Reinforcing social dialogue

All the evidence suggests that the advantages of financial participation are greater when the schemes are introduced in a partnership with employees and when they are part of an overall approach to participatory management.

The Commission attaches particular importance to supporting the social partners’ initiatives on financial participation, including exchanges of information and experience, formation of networks and research and studies.

Financial participation and small and medium-sized enterprises (SME)

The advantages of employee financial participation are not confined to large enterprises with profitability concerns. SMEs can also benefit from these advantages. The Commission attaches particular importance to the specific situation of SMEs and encourages research into their specific problems.

Improving information by research and studies

The Commission continues to support and carry out research projects to provide supply any information which is missing. It focuses particularly on collecting data on how and where participation schemes are implemented, the impact of financial participation on company performance, quality of work, social cohesion and the situation of financial participation in acceding countries. It also asks the European Foundation for Improving Living and Working Conditions to pursue its activities in the field of employee financial participation.

Establishing networks

In order to step up dissemination of information and experience and to make the possibilities of financial participation more widely known, it is important to promote a permanent dialogue at European level. The Commission supports the establishment of the following networks: university networks and networks of experts, social partners, enterprises and institutes.

Financial support for financial participation initiatives

Financial support is available via various channels: the “Industrial relations and social dialogue” budget heading and Community incentive measures in the field of employment. Under Article 6 of the Regulation on the European Social Fund, the Commission may finance innovative action designed to promote new approaches and identify examples of good practice.

The activities set out in this Communication initially cover the period 2002-2004. Following this, the progress achieved in meeting the defined objectives will be assessed in a process that will closely involve all the parties concerned. A decision will be taken on future initiatives on the basis of this assessment.

Report on employment in Europe 2004

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Report on employment in Europe 2004

Outline of the Community (European Union) legislation about Report on employment in Europe 2004

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Employment and social policy > Social and employment situation in europe

Report on employment in Europe 2004

Document or Iniciative

Commission report on Employment in Europe 2004. Recent developments and prospects [Not published in the Official Journal].

Summary

Economic growth in the enlarged European Union slowed in 2003 whilst world growth accelerated, driven by the United States and Japan. As a result, employment growth in the EU in 2003 was virtually zero, unlike in the United States where jobs continued to be created steadily.

It is the most vulnerable sectors of the labour market in the European Union, especially the industrial sector, young people and the low skilled, that suffer most in this difficult situation. What is more, the employment situation is very uneven throughout the 25 Member States, with close to half of them seeing employment decline in 2003 and the other half enjoying employment growth of more than 1 %.

Employment is a key element of the Lisbon strategy, which is intended to increase the volume and enhance the quality of work and its role as a promoter of social inclusion and cohesion. The employment strategy is built around three quantitative objectives, namely an employment rate of 70 % for the entire population, 60 % for women and 50 % for older people by 2010. Although progress was made in 2003 in terms of women’s and especially older people’s employment, the employment rate as a whole stagnated at around 63 %.

In general, the failure to hit the Lisbon targets reflects the structural problems in the labour market in the various Member States. Radical reforms are required to enhance the prospects of employment for women, young people and older persons. At the same time, these efforts to increase the rate of employment must be accompanied by an increase in productivity and job quality.

The key factors in employment: institutions active labour market and policies (ALMPs)

To increase the rate of employment, it is crucial for the economy to open up to trade. However, in the current situation, two specific instruments may also need to be deployed: expenditure on ALMPs and the use of part-time work. As far as ALMPs are concerned, the report views the measures on behalf of young people and to improve public employment services as being particularly effective. Their positive impact on employment is even more marked in countries where unemployment and social security benefits are lower in comparison with income from employment.

However, the report plays down the long-term impact of tax incentives on employment. The level of taxation and social security contributions does not appear to affect the overall rate of employment appreciably, although it does have a detrimental effect on low-skilled employment. As a general rule, ALMPs are more effective where wage bargaining is coordinated at central or sectoral level than in decentralised bargaining systems.

Employment in services is lagging behind the United States

There is a considerable gap in employment in the services sector between the EU and the United States, where the sector accounts for a greater proportion of the labour market. This is particularly true in the case of women and older workers, which means that there is untapped potential for creating jobs in services. The highest job creation rates in the United States are for both the most highly and least skilled jobs, although some EU Member States are equally as dynamic in this area.

The differences in employment in services between Europe and the United States reflect radical differences in consumption patterns and the level of final demand. Easier access to work for women and older persons in the United States generates a greater demand for services which explains why jobs are being created more quickly in this sector. The less dynamic employment situation in the EU is accounted for less by inflexibility, which is frequently cited as an obstacle to creating low-skilled jobs, than by weak household consumption.

In order to better tap the potential for employment in services, it is up to the Member States to set up a genuine single market in services and also to redirect public investment towards creating relatively well-paid and highly-productive jobs in social education and health services.

Education and training to get people out of low-paid and insecure employment

The various types of contracts and new forms of recruitment enable enterprises to respond more effectively to demand in real time. However, this flexibility carries the risk of lower job security for certain workers, which can adversely affect productivity and equality of employment. Although it is possible to make the transition from a temporary or low-paid job to a more stable and better paid job in most cases, the rate of exclusion from the labour market is still very high for vulnerable workers. There are marked differences between the Member States for workers attempting to make the transition from unemployment to insecure employment and then to permanent employment.

Women, the low-skilled and older workers are more likely to have temporary contracts and are more vulnerable in terms of pay and advancement prospects. The report takes the view that qualifications and training offer the best opportunities of strengthening a person’s position in the labour market. As a rule, flexibility should not marginalise the most vulnerable workers. Active labour market policies must deploy public employment and training services to make it easier to gain access to and improve one’s position in the labour market.

Employment and globalisation

In terms of growth and employment, the European economies have benefited from integrating their markets and from the increasing pace of globalisation. In the short term, the 2004 enlargement should not have a significant effect on pay and employment in the EU. By contrast, technological progress and higher productivity in some sectors are likely to lead to more restructuring and relocation. Transitional policies must be implemented to enable workers who have been relocated or laid off to retrain or strengthen their position in the labour market.

The differences in pay vis-à-vis international competitors in some sectors will not necessarily result in job losses in the EU. Policies geared to productivity and research will enable flexible and highly qualified labour forces to reap the benefits of globalisation. EU companies will need to modernise to maintain their competitive edge if job security is to be safeguarded for everyone.

Context

Despite the efforts made to reform its labour markets, the EU is not on schedule to hit the employment targets set in Lisbon for 2010. The report’s priority recommendation is to encourage greater participation of women and older persons in the labour market, mainly by creating more jobs in services. Moreover, training and public employment services must be developed in order to strike a balance between flexibility and job security. The European employment strategy offers a suitable instrument for reinforcing national action on employment and harnessing globalisation for the benefit of the EU’s economic and social objective.

RELATED INSTRUMENTS

Report from the Commission (2003). Employment in Europe 2003 [Not published in the Official Journal]

Report from the Commission (2002). Employment in Europe 2002 [Not published in the Official Journal]

Report from the Commission (2001). Employment in Europe 2001 [Not published in the Official Journal]

Report from the Commission (2000). Employment in Europe 2000 [Not published in the Official Journal]

Report on Employment in Europe 2005

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Report on Employment in Europe 2005

Outline of the Community (European Union) legislation about Report on Employment in Europe 2005

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Employment and social policy > Social and employment situation in europe

Report on Employment in Europe 2005

Document or Iniciative

Commission Report on Employment in Europe 2005. Recent Trends and Prospects [Not published in the Official Journal].

Summary

In the course of 2004, economic activity in the European Union (EU) followed two different trends. Galvanised in the first half of the year, it was gradually weakened in the latter half. Two major reasons for this were the increase in oil prices and the strength of the euro.

Economic growth in the EU was noteworthy (2.4 % for 2004 compared with 1.1 % in 2003). In this respect, the significant increase in world GDP and trade seem to have served as a stimulus.

In line with the economic reality in Europe, employment growth once again showed signs of stagnation, despite the structural improvements made possible by the European Employment Strategy (EES). This has implications with regard to meeting the Lisbon and Stockholm objectives for 2010. There are inequalities between Member States in terms of income, particularly between the Europe of 15 and the new Member States.

Although there are significant variations from one Member State to another, in relation to gender and level of qualifications, unemployment * remains high on the whole across Europe. Nevertheless, the current trend is towards a reduction in the non-working population. A more worrying phenomenon is that the EU as a whole is not making optimum use of its potential labour force. Indeed, in the absence of targeted policies, the heterogeneity of the non-working population makes it difficult to match job supply and demand.

In light of this, the report recommends making growth and employment two key objectives of the revised Lisbon Strategy.

Employment: mixed results

For the third year in succession, employment rose by only a little in 2004 (0.6 %, which is 0.3 % higher than in 2003). The average rate of employment for the whole of the EU rose by 0.4 % to 63.3 %. Therefore, despite a slight improvement over previous years, the results continue to be disappointing compared with the situation in the USA, where employment growth reached 1.1 %.

The report identifies several factors which explain this slight increase in the overall employment rate. The first is the continued increase in the employment rate among women (+ 0.7 % on average in the EU). The second is the 0.8 % increase in the employment * rate among older people (aged 55 to 64 years). Third is the stabilisation of unemployment figures compared with 2003, despite a slight increase in the rate of long-term unemployment (0.1 %).

Lisbon and Stockholm: difficult objectives

According to the report, one of the major consequences of the poor health of the employment market in Europe is slow progress in meeting the Lisbon and Stockholm objectives. As a guide, it is estimated that overall employment rates (63.3 % in 2004) are still 7 % lower than the objective set for 2010. With regard more particularly to women and older people, employment rates (55.7 and 41.0 % in 2004) are respectively around 4 and 9 % lower than initially expected.

In light of the mixed results of recent years and the difficulties posed by the 2010 objectives, the European Council has taken action by agreeing to revise the Lisbon Strategy and refocus its priorities on economic growth and employment.

Disparities in employment across Member States

While growth in employment was relatively low at EU-level in 2004, it was generally positive in the majority of Member States. As indicated in the report, only four countries experienced negative annual growth. This was the case particularly in the Netherlands, where employment fell by 1.3 %. The other three countries were Hungary (-1.2 %), Latvia (-0.2 %) and Slovakia (-0.2 %). In contrast, seven Member States achieved positive employment growth of over 1 % (in particular Cyprus, Greece, Ireland, Luxembourg and Spain). In Germany, positive employment growth was restored, and Poland halted its decline in this field.

Different levels of growth

As indicated in the Commission report, employment growth depends on the sector and on the status and profile of the worker. Between 2003 and 2004, the services sector continued to drive employment expansion. In contrast, employment in both the agriculture and industry sectors continued to contract in 2004. The degree of flexibility of employment is also a factor, which is why the share of part-time and fixed-term employment increased. However, the share of self-employment remained stable. Finally, since 2000, there has been a steady increase (4.4 %) in employment rates among older people aged 55-64 in almost all Member States. Young people, on the other hand, have experienced a deterioration in the labour market situation. At 18.7 %, youth unemployment in the EU is almost twice as high as the overall unemployment rate. In response to this problem, the European Council recently adopted the European Pact for Youth.

Caution still necessary

The employment prospects for 2005 and 2006 are positive overall, with an improvement which, according to the report, is in line with the pick-up in economic activity. Nevertheless, caution still needs to be exercised, especially as future progress remains largely dependent on the return of sustained business confidence, rising economic growth and the implementation of structural reforms.

Taking stock of the EES

In its report, the Commission also focuses on the EES, whose application since 1997 has made possible a number of reforms in various sectors. This has led to structural improvements in employment at EU-level, as reflected in the following:

lower structural rates of unemployment in most Member States;
lower long-term unemployment rates;
shorter spells in unemployment;
better match between job supply and demand;
a rise in aggregate labour demand;
a wage formation process that takes better account of prevailing conditions in the economy and competitiveness constraints;
an increase in expenditure on labour market policies and on training.

Despite structural progress, unemployment remains high. Moreover, progress in terms of labour productivity and quality (education attainment levels, the transitions from temporary to permanent jobs and out of low-paid jobs) is mixed. Finally, while there have been some signs of improvement towards greater social cohesion (reduction of gaps related to gender and age and of inequalities), the recent economic slowdown (2001-2003) may change that.

Income: a two-speed Europe

Overall there has been no sign of an increase in earnings inequality in Europe since the 1970s. Yet the report highlights marked differences between Member States, with earnings disparities in old Member States between two and four times larger than in new Member States. There are also substantial earnings disparities within Member States, from one region to another or even from one sector to another. Moreover, as in the case of employment, income is also influenced by various factors: firms’ specificities (size, organisation, structure, activity), individual characteristics of workers (skills, profession, gender, age), institutional features (bargaining schemes, type of contract).

The report therefore advocates finding the right balance between efficiency and equity in wage policies, which would help to effectively solve any dilemma between social cohesion and growth objectives.

Potential labour supply from the inactive population

As indicated in the report, in 2004, the economically inactive population of working age (15-64) for all 25 Member States totalled 92 million, corresponding to an average inactivity rate * of over 30 %. This rate varies greatly from one country to another, ranging from a low of 19.9 % in Denmark to rates of around 40 % in Hungary (39.5) and in Malta (41.7).

Overall inactivity varies according to gender and level of qualifications, but less so according to age. Inactivity is around 16 percentage points lower for men than for women. Moreover, inactivity rates are over 47 % for the low-skilled against just over 13 % for the high-skilled. However, in terms of age, the inactive population is distributed evenly with one third in each of the three main age segments – youth, prime-age and older people, despite the fact that the prime-age group is the largest one.

The report identifies five reasons for inactivity in Europe:

participation in education and training, corresponding to around a third of the inactive population, mainly young people;
retirement (20 %);
family or personal responsibilities (approximately 16 %);
illness or disability (13 %);
not seeking employment (4.5 %).

The report also states that, in the long term, inactivity * is gradually declining as a result of two main trends:

the entry into the labour market of increasing numbers of women aged over 25;
older people of both sexes staying in the labour market for a longer period.

Between 2003 and 2004 around 9.5 % of the inactive population moved into employment, while a further 4 % joined the unemployed category. At the same time, 3 % of the employed and almost 22 % of the unemployed withdrew from the labour force. Figures show that the potential labour supply extends far beyond the unemployed; it also comprises a sizeable part of the inactive population. In several categories of the inactive population, the tendency to work equals even that of the unemployed.

Therefore, to use the inactive population as a potential labour supply, the report calls for more systematic use of various measures such as Active Labour Market Policies (ALMPs) and other measures supporting job creation and opportunities. More effective targeting is also a crucial factor in supporting their labour market participation.

Background

Given the close links between economic growth and labour market performance, the slowdown in economic growth in the EU had a significant negative impact on employment creation. The report therefore recommends making growth and employment two key objectives of the revised Lisbon Strategy.

Key terms used in the act
Unemployment: whereby someone without a job has been actively looking for work in the four weeks prior to the survey and is willing and available to work in the following two weeks. Inactivity: whereby the individual is out of the labour force, i.e. those that are neither working nor actively seeking and immediately available for work.

Related Acts

Commission Report (2004). Employment in Europe 2004[Not published in the Official Journal]

Commission Report (2003). Employment in Europe 2003[Not published in the Official Journal]

Commission Report (2002). Employment in Europe 2002[Not published in the Official Journal]

Commission Report (2001). Employment in Europe 2001[Not published in the Official Journal]

Commission Report (2000). Employment in Europe 2000[Not published in the Official Journal]

Joint report on social inclusion

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Joint report on social inclusion

Outline of the Community (European Union) legislation about Joint report on social inclusion

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Employment and social policy > Social inclusion and the fight against poverty

Joint report on social inclusion

Document or Iniciative

Communication from the Commission of 12 December 2003 concerning the joint report on social inclusion summarising the results of the examination of the National Action Plans for Social Inclusion (2003-2005) [COM(2003)773 – Not published in the official journal].

Summary

In order to encourage more ambitious and effective strategies to promote social inclusion, the report sets out the main trends and challenges associated with policies to combat poverty and social inclusion within the European Union. It also highlights the progress achieved in implementing the open method of coordination between the Member States and outlines the main priorities for action. This report served as the basis for the joint report by the Council and the Commission, which was adopted in March 2004.

SOCIAL INCLUSION – SITUATION IN THE EUROPEAN UNION

Overview

The action taken by the European Union to promote social inclusion must be examined in light of the overall economic downturn which Europe has suffered for the past few years. This development, which has been associated with a slowdown in employment growth and an increase in unemployment, has hampered, but not stopped, the European Union in its efforts to achieve the employment objectives set out in Lisbon and Stockholm.

The years immediately preceding the introduction of the new social inclusion strategy have seen a reduction in relative poverty, which fell from 17% in 1995 to 15% in 2001. In all countries, the poverty threshold has risen faster than the rate of inflation, implying an increase in the overall level of prosperity. Between 1998 and 2001, the risk of poverty also fell across the board.

The present report nevertheless points out that, in 2001, more than 55 million people were still facing the risk of poverty, i.e. 15% of the European population. The groups most at risk were the unemployed, single parents, elderly people living alone and families with a large number of children.

The risk of poverty varies widely from one country to another, from 10% in Sweden to 21% in Ireland. In the countries in the south, and in the United Kingdom and Ireland, vulnerable members of the population generally benefit less from prosperity and are also more at risk from the most persistent forms of poverty and privation.

Moreover, long-term unemployment, which is closely linked to social exclusion, has a significant role to play. In 2002, it affected almost 3% of the working population (or 39% of the unemployed). With a few exceptions (Finland, Ireland, Sweden and the United Kingdom), it affects women more than men. Nevertheless, long-term unemployment has fallen steadily since 1995, when it reached its peak of 4.9%.

Although these statistics give cause for concern, significant progress has been made in the labour market. In 2002, the average employment rate within the European Union rose from 63.4% to 64.3%. Women benefited the most, with female employment increasing by more than 1% between 2001 and 2003 (from 54.1% to 55.6%). Moreover, the employment rate of elderly people rose significantly within the EU as a whole, except for Austria, Germany and Italy.

The six major priorities associated with the Lisbon objective

In an attempt to achieve the Lisbon objective, it is necessary to ensure that those facing the risk of poverty and social exclusion do not suffer disproportionately from the effects of the economic slowdown and the resulting budget restrictions. The Member States are therefore asked to attach the greatest possible importance to the following six policy priorities:

promoting investment in and tailoring of active labour market measures to meet the needs of those who have the greatest difficulties in accessing employment;
ensuring that social protection schemes are adequate and accessible for all and that they provide effective work incentives for those who can work;
improving access by those most at risk of social exclusion to proper housing and healthcare, and to education and lifelong learning;
making a concerted effort to prevent dropping out of school and promoting a smooth transition from school to the workplace;
focusing on the eradication of child poverty;
developing a dynamic policy to reduce poverty and social exclusion among immigrants and ethnic minorities.

National action plans for social inclusion 2003

The second generation of national action plans for social inclusion are based on a less optimistic view of the economic situation than their predecessors. The current economic slowdown could place people at greater risk of poverty and social exclusion. Moreover, those who are already affected are bound to suffer as a result of the overall increase in long-term unemployment and the fact that it is now more difficult to find work.

If the fight against poverty and social exclusion is to be properly coordinated and effective, the Member States must make it part of their economic, social and employment policies.

Against this background, the eight major challenges identified in the first joint report continue to be the following:

developing an inclusive labour market and promoting employment as a right and opportunity for all;
guaranteeing an adequate income and resources to live with dignity;
tackling educational disadvantage by prevention and lifelong learning opportunities;
preserving family solidarity while promoting gender equality and protecting the individual rights and benefits of family members and the rights of the child;
proper accommodation for all;
guaranteeing equal access to quality services;
improving public services so that they meet local and individual needs;
regenerating areas of multiple hardship.

Each national action plan for social inclusion is based on very different considerations, depending on the approach and priorities of the Member State which drew it up. However, irrespective of the country concerned, the national action plan for social inclusion has to meet three basic criteria:

exhaustive and multidimensional approach
Wherever possible, the national action plans for social inclusion must implement actions and policies in the different areas which affect the public. This multidimensional approach is evident in the national action plans drawn up by Belgium, France, Ireland, the United Kingdom, Portugal and Greece.
coherent and planned approach
The national action plans for social inclusion must be based on an in-depth analysis of the situation and must define clear and specific objectives. On the whole, the plans drawn up in 2003 were more coherent than their predecessors. A number of Member States, particularly the Netherlands and the Scandinavian countries, stand out because of the strategic and logical vision reflected in their plans.
definition of objectives
The plans must set precise targets for eradicating poverty and social exclusion by 2010. In general, three tendencies are evident from the plans drawn up by the Member States:

– direct outcome targets: aimed directly at reducing poverty and social exclusion in a key policy area;

– intermediate outcome targets: contribute indirectly to reducing poverty and social exclusion;

– input targets: improve policy effort in a particular area.

Greece, Spain, Ireland and Portugal are among the small number of Member States which have really established clear overall targets. In general, the approach is less systematic and focuses on problems of employment and unemployment. Few Member States take account of the male-female dimension.

SOCIAL INCLUSION – SITUATION IN THE MEMBER STATES

Belgium

Situation and key trends:

– Plus points:

– adoption of active measures to help the labour market;
– improvement of social protection and innovation in health-care provision;
– action to combat discrimination.

– Minus points:

– increase in long-term unemployment and youth unemployment;
– rather inconclusive results as regards housing, education and lifelong learning.

Strategy based on:

– an active welfare state;
– access to justice, culture and rights for atypical families;
– the male-female dimension;
-immigration questions;
-efforts to combat the over-indebtedness of poor populations.

Denmark

Situation and key trends:

– Plus points:

– one of the lowest monetary poverty rates in the European Union;
– more equal distribution of income than in most Member States;
– introduction of flexible and protected working arrangements, and a method based on the capacity for work;
– introduction of an early retirement scheme and an integrated planning programme based on the development of employment.

– Minus point: life expectancy has increased less than in other Member States.

Strategy based on:

– administrative bodies, local authorities and local coordination committees;
-the involvement of users, particularly the most disadvantaged and marginalised groups;
– individualisation of needs;
– voluntary work.

Germany

Situation and key trends:

– Plus points:

– lower risk of poverty than in most Member States;
– he objective of reducing unemployment among the disabled by 25% has almost been achieved;
– introduction of a system of basic social protection designed to reduce poverty among the elderly or infirm;
– implementation of the “Social city” programme to help disadvantaged areas.

– Minus point: discrepancy between the west, where the poverty rate is 10% and the east, where it stands at 16%.

Strategy based on:

– a programme of objectives,
– local and regional social policy.

Greece

Situation and key trends:

– Plus points:

– constant improvement in the macroeconomic situation;
– GDP growth is above the EU average;
– development of employment growth and fall in unemployment rate;
– improvement of the system of social protection and increase in social expenditure, in particular for vulnerable groups.

– Minus point: poverty rate is below the EU average.

Strategy based on:

– a convergence charter adopted in 2003, and ten national objectives which have to be achieved by 2010;
– general policies, particularly as regards economic growth and structural changes;
– specific measures designed to resolve the problems of poverty and social exclusion;
– four main lines of action: rural areas, elderly people, promotion of access to employment and the quality of management.

Spain

Situation and key trends:

– Plus points:

– GDP growth is above the EU average;
– reduction in long-term and very long-term unemployment rate;
– extension of the fight against social exclusion at regional and local levels;
– progress in terms of cooperation between the social services and employment services;
– resources used to help vulnerable groups, particularly via financial assistance to victims of domestic violence.

– Minus point: the unemployment rate for women is still much higher than that for men, and more women than men are in temporary work.

Strategy based on:

– employment;
– access of groups who are at risk of or living in poverty to health care, education and housing;
-objective of reducing by 2% the number of people living below the poverty level;
– greater involvement of women with few qualifications in the labour market.

France

Situation and key trends:

– Plus point: significant progress as regards access to rights, in particular health care and justice.

– Minus points:

– very weak growth, which has led to a slowdown in the creation of jobs and a rise in unemployment (9.6% in 2003);
-increase in the number of people receiving the minimum income benefit;
-housing policies are insufficient to meet the needs concerned.

Strategy based on:

– access to rights and employment;
-decentralisation of territorial entities and the private sector;
-quantifiable objectives covering the main aspects of the national action plan for social inclusion.

Ireland

Situation and key trends:

– Plus points:

– drop in persistent poverty and in the school drop-out rate;
– implementation of measures to support the unemployed and promote adult literacy;
– investment in infrastructure is above the EU average.

– Minus points:

-slowdown in economic growth, leading to a slight rise in unemployment;
-increase in the risk of poverty;
-life expectancy is lower than in other Member States;
-homelessness and the cost of housing still give cause for concern.

Strategy based on:

– access to employment and education;
– the most vulnerable groups;
– the examination of a number of social problems.

Italy

Situation and key trends:

– Plus points:

– significant reduction in the risk and rate of poverty;
-approval by most regions of a regional social plan enabling them more effectively to adopt strategies to combat social exclusion.

– Minus points:

– wide discrepancy between the north and the south, where the poverty rate is four times higher.

Strategy based on:

– the 2003 White Paper on social policy in Italy;
– a social agenda over a three-year period;
– decentralisation towards the regions and local authorities.

Luxembourg

Situation and key trends:

– Plus point: employment growth has been constant.

– Minus points:

– significant fall in the GDP growth rate and rise in unemployment;
– adoption of measures relating to facilities, housing assistance and resources for disabled people and young people.

Strategy based on:

– participation in employment;
– reconciliation of family life and work;
– access to housing;
– social inclusion of young people;
– access of vulnerable people to resources, rights and services.

Netherlands

Situation and key trends:

– Plus points:

– one of the lowest poverty rates in the EU;
-employment rate overall and female employment rate are well above the Lisbon objectives;
– increase in participation in the labour market of ethnic minorities, older workers and people who are alienated from the labour market.

– Minus points:

– increase in the unemployment rate by 4% in one year;
– the number of young people leaving school without qualifications is still high among certain ethnic minorities;
– health care waiting lists for health care are worrying;
– facilities for children are incomplete.

Strategy based on:

– an innovative model which identifies the risks of poverty being passed on from one generation to another;
– a new system of financial award based on local authorities.

Austria

Situation and key trends:

– Plus points:

– significant drop in the overall rate of poverty risk;
– slight increase in expenditure on social protection;
– lowest school drop-our rate in the EU;
– steady increase in female employment;
– adoption of measures to help the elderly, the unemployed who are most disadvantaged, disabled people and immigrants.

– Minus points:

– progressive increase in the youth unemployment rate;
– one of the lowest rates of graduates in Europe.

Strategy based on:

– bringing down the school drop-out rate;
– guarantee of a minimum salary of EURO 1 000 and a tax exception up to this ceiling;
– extension of the minimum retirement scheme;
– continued integration of migrants.

Portugal

Situation and key trends:

– Plus point: introduction of a minimum wage scheme and of employment promotion measures.

– Minus points:

– adverse impact of the current economic slowdown, particularly on the unemployment rate and overall productivity;
– the poverty rate is still one of the highest in the EU.

Strategy based on:

– very general objectives and principles, without explicitly mentioning sources of financing and budgets used;
– a “Social Network”;
– education and training;
– increasing the value of minimum retirement pensions;
– certain vulnerable groups (children, young people, the homeless, immigrants);
– access of the public to information on their social rights.

Finland

Situation and key trends:

– Plus point: the Finnish social system is based on the principle of universality, the aim of which is to provide the entire population with social assistance and health care services with a view to guaranteeing resources.

– Minus points:

– impact of slowdown in growth on the demand for labour;
– increase in the unemployment rate and reduction in the employment rate.

Strategy based on:

– the existing system of social protection, based on the principle of decentralisation;
-a timetable for monitoring the implementation of all measures;
-four major policies: promoting health and working life, making working life more attractive, preventing and combating social exclusion and guaranteeing effective services.

Sweden

Situation and key trends:

– Plus points:

– the proportion of GDP used for expenditure on social protection is the highest in the EU;
– lowest poverty rate in the EU;
– distribution of income is relatively equal;
– very high employment rate and very low unemployment rate;
-increased effort to promote social integration and reduction in the percentage of recipients of social assistance.

– Minus point: the objective of reducing dependence on social assistance by half and increasing the employment rate to 80% by 2004 will be difficult to achieve.

Strategy based on:

– a high employment rate, achieved through a number of measures allowing individuals to work and meet their needs;
– a significant reduction in the number of people at risk of poverty by 2010;
– integration of the male-female dimension.

United Kingdom

Situation and key trends:

– Plus points:

– high employment level and low unemployment level;
– considerable resources used to help vulnerable groups.

– Minus points:
– poverty rate is above the European average,
– social disparity is still marked.

Strategy based on:

– a strategy to combat poverty and social exclusion involving a large number of people;
– high quality public services;
– particularly disadvantaged groups;
– the eradication of child poverty by 2020;
– promoting access to the employment market and to skilled work;
– high and stable employment levels.

CONTEXT

The Lisbon European Council of March 2000 asked the Member States and the Commission to take ambitious and effective measures by 2010 to eradicate poverty. It was also suggested that they should coordinate their policies to combat poverty and social exclusion in order to pool their objectives, indicators and national action plans.

In December 2000, the Nice European Council decided to launch a new method of combating poverty and social exclusion, based on four objectives:

promoting participation in employment and access by all to resources, rights, goods and services;
preventing the risks of exclusion;
action to help the most vulnerable;
mobilising all relevant bodies.

In this context, the national action plans for social inclusion, which were submitted in June 2001, aimed to translate the common objectives into national policies, while taking account of the situation in each Member State, and the different national systems of social protection.

The national action plans for social inclusion were examined in depth by the European Commission and the Member States in the joint report on social inclusion approved by the Laeken European Council in December 2001.

In December 2002, the European Council asked the Member States to prepare a second set of national action plans for social inclusion for July 2003.

Related Acts

Communication from the Commission of 10 October 2001 concerning the draft joint report on social inclusion (2000-2002) [COM(2001) 565 – Not published in the Official Journal]

Commission staff working paper. Social inclusion in the new Member States. A synthesis of the joint memoranda on social inclusion [SEC(2004) 848].

The Gothenburg European Council asked the new Member States to transpose into their national policies the social, environmental and economic objectives of the European Union.

Against this background, the Joint Inclusion Memoranda (JIM) reflect the political commitment of the new Member States to attach greater importance to combating poverty and social exclusion.

Social exclusion is a thorny problem in most of the new Member States and is largely the result of their readjustment to a market economy. This profound change resulted in a severe fall in production and a significant increase in the unemployment rate, particularly in the Baltic States, Poland and Slovakia.

In absolute terms, the risk of poverty in the new Member States is comparable with that in the old Member States. However, salary levels in the new Member States are much lower and people living below the poverty level experience living conditions which are significantly worse than those in the other countries in the EU.

The worrying levels of poverty highlighted in the Joint Inclusion Memoranda prove that the need for action is urgent. In this regard, six main challenges have been identified:

expand employment market policies in order to improve the integration of those groups who are most at risk;
ensure that social security systems guarantee an adequate minimum wage which enables everyone to live with dignity;
increase the opportunities available in the fields of education and lifelong learning, particularly for those at risk of poverty and social exclusion;
improve the quality of public services;
step up efforts to combat very high levels of exclusion and discrimination against certain ethnic groups, such as the Roma, and other very vulnerable groups;
strengthen policies to support the family and social assistance networks and reinforce the protection of children’s rights.

2009 Employment in Europe Report

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2009 Employment in Europe Report

Outline of the Community (European Union) legislation about 2009 Employment in Europe Report

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These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Employment and social policy > Social and employment situation in europe

2009 “Employment in Europe” Report

Document or Iniciative

Commission Report “Employment in Europe 2009” [Not published in the Official Journal].

Summary

The year 2009 has been marked by the international financial crisis, which hugely affected the labour markets, after many years of growth in employment in Europe.

Although European Union (EU) countries may have been affected in different ways, they have all experienced a decrease in job offers. The Commission observes that certain population groups are more affected by the job losses: lower-skilled young people, temporary workers and older workers.

Through the internal flexibility of companies (shorter working hours, temporary partial unemployment, etc.) and wage concessions by workers, certain countries were able to limit the job losses. However, in 2010, the unemployment rate was expected to reach 11% in the EU.

In this context, European policies have a particular role to play. They must help to preserve jobs, help people into employment and support the most vulnerable. In addition, the Lisbon Strategy cycle comes to an end in 2010, and the EU must also develop new policy priorities in order to prepare for the transition to a low-carbon “green” economy.

Analysis of labour markets

European labour markets are relatively dynamic, which indicates that job offers correspond to demand. In fact in all the EU countries, workers can change job (22% per year), return to work or leave unemployment with relative ease.

However, long-term unemployment persists for certain population groups; it continues for more than a year for 45% of people affected. The most vulnerable people are women, older and low-skilled workers. To tackle this type of unemployment, the Commission recommends recourse to appropriate employment policies, based on the principles of flexicurity.

Climate change and the development of labour markets

The EU must adopt policies aimed at developing a competitive low-carbon economy. This transition towards a green economy must have a positive impact on the labour market, specifically through:

the construction of new infrastructures;
the development of new technologies;
direct employment in the renewable energy sector (production, installation and maintenance);
the development of new service sectors.

Forecasts indicate that the sustainable development sector could create between 2.3 and 2.8 million jobs between now and 2020.

Initially, high-skilled workers will benefit from the jobs created. Education and training actions should then help to increase the general skills level in the labour markets.

The Commission also recommends the introduction of policies based on the principles of flexicurity, a respect for workers’ rights and an increase in social spending.

Finally, the Commission highlights the need to reinforce social dialogue and the assessment of labour markets.

Social and employment situation in europe

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Social and employment situation in europe

Outline of the Community (European Union) legislation about Social and employment situation in europe

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Employment and social policy > Social and employment situation in europe

Social and employment situation in europe

Statistical data which can be compared at European level are essential for the monitoring of social and labour market developments in the European Union. They are used in particular to assess the impact of economic and demographic changes on the labour market. In this respect, the Commission has set up systems for collecting statistical information used to establish performance indicators. It also supports the analysis work undertaken by the Member States through the Community Programme for Employment and Solidarity, and the work of the European Employment Observatory. All this information is recorded in annual reports.

REPORTS

2009 “Employment in Europe” Report
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(FR)
Employment in Europe Report 2007
Employment in Europe Report – 2006
Report on Employment in Europe 2005
Report on employment in Europe 2004
Joint employment report 2006/2007
Joint Employment Report 2005/2006
Joint Employment Report 2004/2005
Joint Report on Social Protection and Social Inclusion 2008
Joint Report on Social Protection and Social Inclusion: 2007
Joint Report on Social Protection and Social Inclusion 2006
Joint Report on Social Protection and Social Inclusion
Joint report on social inclusion

STATISTICS

Promoting solidarity between the generations
The demographic future of Europe – from challenge to opportunity
Green Paper “Confronting demographic change: a new solidarity between the generations”
Labour Force Sample Survey
Structural statistics on earnings and labour costs
European system of integrated social protection statistics (ESSPROS)
European Statistical Advisory Committee
European Statistical Governance Advisory Board

INFORMATION AND INCENTIVES

Community programme for employment and solidarity – PROGRESS (2007-2013)
European Progress Microfinance Facility (EPMF)
Programme for mutual learning in employment
European Employment Observatory (EEO)

Third progress report on cohesion – towards a new partnership for growth, jobs and cohesion

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Third progress report on cohesion – towards a new partnership for growth, jobs and cohesion

Outline of the Community (European Union) legislation about Third progress report on cohesion – towards a new partnership for growth, jobs and cohesion

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These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Regional policy > Review and the future of regional policy

Third progress report on cohesion – towards a new partnership for growth, jobs and cohesion

Last updated: 24.10.2005

Enforcing judgments: the transparency of debtors' assets

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Enforcing judgments: the transparency of debtors’ assets

Outline of the Community (European Union) legislation about Enforcing judgments: the transparency of debtors’ assets

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These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Justice freedom and security > Judicial cooperation in civil matters

Enforcing judgments: the transparency of debtors’ assets

Even with a court judgment obtained, recovering cross-border debts may be difficult for creditors in practice if no information on the debtors’ assets or whereabouts is available. Because of this, the European Commission has adopted a Green Paper launching a public consultation on how to improve the recovery of debts through possible measures such as registers and debtor declarations.

Document or Iniciative

Green Paper of 6 March 2008 on the effective enforcement of judgments in the European Union: the transparency of debtors’ assets [COM(2008) 128 final – Not published in the Official Journal].

Summary

The late and non-payment of debts is detrimental to business and customers alike, particularly when no information is available on the debtor’s assets or whereabouts. This is a particular cross-border issue in debt recovery and has the potential to affect the smooth running of the internal market. In launching a public consultation, the European Commission has outlined the problems of the current situation and possible solutions in this Green Paper. Interested parties can submit their comments by 30 September 2008.

State of play

The search for a debtor’s address and information on his financial situation is often the starting point for enforcement proceedings. At national level, most Member States mainly use two different systems for obtaining information, either:

systems of declaration of the debtor’s entire assets or at least a part of it to satisfy the claim;
search systems with specific information (registers).

In this Green Paper, the European Commission focuses more on a series of measures instead of one single European measure to allow the creditor to obtain reliable information on the debtor’s assets and whereabouts within a reasonable period of time. Possible measures include:

drawing up a manual of national enforcement laws and practices: at present, there is very little information on the different enforcement systems in the 27 European Union Member States. Such a manual could contain all sources of information on a person’s assets, which could be accessed in each country; contact addresses, costs, etc.
increasing the information available and improving access to registers: the main sources of information on the debtor are public registers, such as commercial or population registers. However, these vary from one Member State to the next. The Commission is asking whether to increase information available in and access to commercial registers and in what way access to existing population registers should be enhanced. Furthermore, access to social security and tax registers by enforcement authorities may be increased, while respecting rules of data protection and social and fiscal privacy.
exchange of information between enforcement authorities: currently, enforcement bodies are not able to directly access the (non-public) registers of other Member States which are open to national enforcement bodies. In addition, there are no international instruments dealing with the exchange of information between national enforcement bodies. In the absence of a Europe-wide register, enhancing cooperation between national enforcement authorities and direct exchange of information between them may a possible solution.
measures relating to the debtor’s declaration: enforcement bodies have in several Member States the option to question the debtor directly regarding his assets, whereas in some Member States the debtor’s declaration is made in the form of a testimony before the enforcement court. In some Member States, the debtor has to fill out mandatory forms, and in others a debtor’s declaration does not exist at all. The European Commission is considering introducing a European Assets declaration, obliging the debtors to disclose all assets in the European judicial area. In this way, the transparency of the debtor’s assets would not be limited by the territoriality of the enforcement proceedings.