Visegrad Group dismisses European Commission’s charges of “social dumping”
Budapest, April 27 (MTI) – Hungary, together with the other Visegrad Group countries of the Czech Republic, Poland, and Slovakia, have reiterated their stand against the European Commission’s proposed rules on posted workers in the European Union and rejected charges of “social dumping”, Economy Minister Mihály Varga said on Thursday.
The EC defines a “posted worker” as one who is sent by an employer to carry out a service in another member state on a temporary basis. It argues these workers are different from EU mobile workers because they work abroad temporarily and do not integrate into the host country’s labour market. It defines “social dumping” as foreign service providers’ practice of undercutting local service providers “because their labour standards are lower”.
Speaking at a meeting of Visegrad Group labour and social affairs ministers in Warsaw, Varga said the V4 rejects the use of the expression “social dumping”, according to a statement released by the ministry. He added that the Visegrad Group supports EU rules addressing fraud and the circumvention of rules.
Varga said protecting workers’ rights is important for Hungary. He added that businesses from Visegrad Group countries provide high-standard, competitive services on the EU’s internal market.
In 2014, the EC issued an enforcement directive on posted worker rules addressing issues related to fraud and the circumvention of rules. Last year, the EU’s executive proposed a revision of posted worker rules “to ensure they remain fit for purpose”.
The revision is to be debated at the June meeting of the Employment, Social Policy, Health and Consumer Affairs Council (EPSCO). Should it pass, it would pave the way for measures curbing the economy of the “new” member states, which would deeply damage their competitiveness, Varga said.
Lower wages constitute a competitive advantage for eastern and central European companies operating in western countries. Their success is especially prominent in construction and processing industries, Varga said.
More affluent countries argue that lower wages are these companies’ only competitive edge over local employees. They want to amend the directive so that the receiving country’s labour code, as well as the local minimum wage and wage system, apply to posted workers.
Varga called the proposal “unacceptable”, noting that 11 member states had already submitted written objections against the proposed directive. The Visegrad and Baltic states, Romania, Bulgaria, Denmark and Croatia voiced similar concerns to Hungary’s, he said.
Hungary also objects to the legislative package on transport, which would essentially adopt the same guidelines in that area inasmuch as it would expand the directives on the minimum wage and minimum hourly wage for posted workers in the transport sector, Varga said. Nine new member states took a stand on the issue in a 2016 December statement, Varga noted.
The V4 meeting also addressed Austrian legislation introduced in January 2017. The legislation aims to forestall “social and wage dumping” by making the Austrian wage system mandatory for posted workers, he said. The group’s social affairs ministers commented on the V4 standpoint in a February 2017 letter sent to their Austrian counterpart, Varga said. The V4 is continuing to cooperate to better enforce their interests, he added.