Event summary, February 21st, 2018
ALL ABOUT PRESIDENCY SERIES
POSTING OF WORKERS IN ROAD TRANSPORT
Co-organised by the Permanent Representation of the Republic of Poland to the European Union in Brussels and the Representation of the Union of Entrepreneurs and Employers in the European Union (ZPP EU), the All About Presidency Series is an regular joint awareness project for entrepreneurs regarding the current European agenda.
The aim of the series of events is to engage entrepreneurs in the European dialogue to further build together and strengthen the EU Single Market, through an open and constructive discussion on current policy initiatives. During each seminar, entrepreneurs, European employers’ organisations and sector organisations, representatives of the Permanent Representation of the Republic of Poland to the European Union, as well as Presidencies in the Council, together with delegates from the Permanent Representations of EU Member States, debate the current social and economic policies, analyse their potential impact on the functioning of the EU Single Market, free movement of people, goods and services across the European Union.
‘Seminars provide an opportunity to analyse, formulate, and communicate recommendations on how to shape policies concerning the European Single Market, in an inclusive manner, with active involvement of all Member States’ – said Marcin Nowacki, ZPP Vice President.
The inauguration event of the All About Presidency Series entitled Posting of Workers in Road Transport was held on February 21st, 2018 at Window Poland in Brussels. Posting workers in road transport is a current regulatory challenge in the European agenda, also in the context of the functioning of the European Single Market. Posting of workers is an example of how a discussion on the free flow of goods and services ought not to look like and it seems to be a literal step back in international road transport. The implications of the Posting of Workers Directive include burdening road transport companies with additional administrative duties, resulting in a significantly negative impact on the European Single Market both in the short and in the long term.
Transport companies have been affected by several changes in legislation at national levels regarding posting and minimum wage, which were vaguely supported by the argument of social dumping. All of them resulting in the increase of transport prices, pushing costs further down the economic chain – ultimately affecting the market and consumers in terms of prices of particular goods.
Without adjusting the law to reality, this regulation will also lead to unfair competition, as new business models will develop to avoid such administrative burdens – therefore, these provisions will not create a better balance on the market. The issues of future road transport sector and employment of cross border drivers arise with an immediate effect, yet they touch upon a broad aspect of sector-based services and their competitiveness in the European Single Market.
The Series was inaugurated with a speech from His Excellency Ambassador Sebastian Barkowski who provided the audience with a high-level introduction to the current European discussion on Posting of Workers thus opening the floor for the panel discussion. Transport Counsellor to the Permanent Representation of the Republic of Poland to the European Union, Justyna Bartnicka gave a broad regulatory perspective on the Mobility Package. European Centre for International Political Economy, Senior Economist, Erik van der Marel outlined the potential risks of overregulation for market functioning, along with an overview of the share of posted workers in total employment in the EU (0,9%), as well as an analysis of market regulatory barriers.
Nicolette van der Jagt, CLECAT Director General (European Association for Forwarding, Transport, Logistics and Customs Services) spoke about the potential impact of lex specialis on the transport sector, where larger players are more likely to incorporate new policy without disruption of their day to day operations. However, such solutions are highly probable to impede not only the markets of Member States, but also markets of countries neighbouring.
‘Applying the PWD to international transport will mean accounting for numerous national legislations to calculate monthly salaries and minimum paid holidays, extra track-record procedures for operators, additional controls by various authorities, and more. Increased burden will not yield positive results for economic growth and fair competition. Small- and medium-sized businesses will not have the capability to handle the new rules, regardless of whether they are based in Slovakia, Italy or Denmark. This will lead to an increased number of operators leaving the business’ summarises Director General van der Jagt in CLECAT newsletter.
Vladislava Gubalova from the think tank Globsec added that in the current discussion we use myths, and delegating employees is not a matter of dispute between Western and Eastern Europe, or that increasing regulation would improve the functioning of the market or introduce social justice – on the contrary, market fragmentation, restricting the flow of people and services do not lead to better prosperity of countries, nor sectors, nor enterprises. Overregulation, on the other hand, will increase the potential for building new business models that will not be subject to the regulation, also failing to protect the people employed, leading to unfair competition in forms that are currently difficult to predict.
The moderator of the debate was Emma Hadrovic from the Danish transport organization, the author of a joint declaration of transport organisations against the introduction of posting of workers in road transport. The debate was summarised by Marcin Nowacki, Vice-President of the Union of Entrepreneurs and Employers who referred to the situation of small and medium-sized enterprises, the importance of transport in the European economy, as well as the practical application of law, stressing that many sectors still have new administrative barriers that are preventing them from further development of the common European market.
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