The row over differing labour costs in Europe has exploded once more and trucking is at its heart.
Emmanuel Macron, President of France, has embarked on a campaign to overhaul the principles of the movement of labour around the European Union. Something called the ‘posted workers directive’ regulates how workers from one member state can be employed in another. All the laws concerning minimum wages and social security in their home country apply rather than those in the country where they are working. This is meant to be on a temporary basis with it being assumed that it is simply an aspect of running the business in the home country, rather than competing in other markets. Mr Macron does not agree.
The French president accuses some of setting-up ‘shell’ companies in France and importing workers from Central Europe, undercutting French workers in France, not least as they do not have to be paid French minimum wages nor social security contributions. In particular, he is accusing trucking companies of bringing in drivers to France through such shell companies.
Therefore, he is proposing to reform the system. In particular, he is looking to include truck drivers under new regulations, obliging them to pay social security and be paid the minimum wage in the country that they are working. He is also looking to limit the length of time that a ‘posted worker’ can work in a foreign country to 12 months in two years. In addition, the French government wants to get rid of shell companies employing posted workers.
Mr Macron’s ideas have not been universally popular. Central European nations are opposing them, although Bulgaria and Slovakia have made conciliatory noises, but Poland and Hungary remain steadfastly opposed. In contrast, Austria is vigorously supporting the moves whilst Germany lurks in the background.
Any reform of the posted workers system would not have dramatic effects on the European road freight market. It may hit certain trucking companies in economies such as France, who ironically would become more uncompetitive on international routes against rivals from Central Europe as their driver related costs would rise. The area where the labour market could tighten would be domestic routes. It will be interesting to see what the implications are for either drivers’ wages or freight rates across Europe.
Source: Transport Intelligence, August 29, 2017
Author: Thomas Cullen
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