Bertrand Guay, AFP l (L-R) Slovak PM Robert Fico, France’s Emmanuel Macron, Austrian Chancellor Christian Kern and Czech PM Bohuslav Sobotka address the press in Salzburg after a meeting on the free movement of labour on August 23.

EU labour ministers meet in Luxembourg on Monday to discuss reforming the rules for posted workers – or those temporarily working in another EU state – which have become a focal point of disputes between Eastern and Western EU members.

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The rules governing so-called posted workers – or employees sent by their employer to work temporarily in another EU member state – have been a particular point of contention ever since several Eastern European countries joined the EU in 2004.

A 1996 EU directive stipulates that posted workers are entitled to the minimum wage of the host country. Unlike EU citizens who move to another member state to seek employment (and are entitled to the same working conditions as nationals within that country), posted workers do not integrate into the other country’s labour market, and their taxes and social charges are paid in their home nations.

This system has raised the issue of "social dumping", which allows foreign service providers to undercut local competitors because their labour standards are lower. Similarly, rules on bonuses, luncheon vouchers and extra pay (such as the 13th month in France) are not homogenous across Europe.

French President Emmanuel Macron has pledged to overhaul the system, saying it creates unfair competition in wealthier countries such as France, Germany and Austria. Macron campaigned hard for the reforms to be strengthened during the summer and visited his counterparts in Central and Eastern Europe to drum up support. However, several points of contention risk undercutting the chances of an agreement being reached.

‘A betrayal of the European spirit’

“The single European market and the free movement of workers is not meant to create a race to the bottom in terms of social regulations,” Macron said in August after meeting Austrian Chancellor Christian Kern, an ally on the issue, in the city of Salzburg. “The posted workers’ directive as it currently functions is a betrayal of the European spirit in its essence,” he added.

The Czech and Slovak prime ministers voiced their agreement with Macron and Kern. However, the Eurosceptic governments of Poland and Hungary oppose Macron’s position and have led efforts to block reform of the directive.

Although posted workers comprise a mere 1 percent of the EU workforce, the politically sensitive issue has deepened the divide between the richer Western and poorer Eastern EU countries. “The posted workers’ directive solves a certain problem but we have to also solve the fundamental issue, which is the huge differences in living standards in individual parts of the EU,” said Czech Prime Minister Bohuslav Sobotka in August.

“I hope we’ll arrive at a breakthrough,” Marianne Thyssen, European commissioner for employment, social affairs and labour mobility, told France Inter radio on Saturday ahead of Monday’s summit. She said that the aim was to have an “equal salary, equal work, in the same workplace”.

Timeframes and road transport

An "enforcement directive" was approved in 2014 relating to fraud, the circumvention of rules and the exchange of information between member states.

However, several sticking points remain. First, the EU commission has proposed limiting the length of time that posted workers spend in the host country to 24 months. France wants this reduced to 12 months. The Austrian, Czech and Slovak leaders agree that it should be less than the originally proposed 24 months but have stopped short of agreeing to the 12-month cap.

Secondly, France wants to press for any new workers' directive to be applied two years after its adoption. The European Commission has proposed three years, while some of the Eastern European countries want it postponed for five years, according to French daily Le Figaro.

The third issue concerns road transport. Indeed, according to a source quoted in French daily La Croix, road transport is “the real issue of the meeting today”.

“Since the Macron law of July 2015, a foreign driver who passes through France for coastal navigation or international transport is considered as a posted worker,” Jean-Marc Rivéra, general secretary of OTRE, the organisation of European road transporters, told La Croix.

This is particularly contentious because not just Eastern European countries but also Spain and Portugal are concerned about how the reforms would affect drivers passing from one country through another.

Given the weight of Spain in the EU, the country could play a deciding role on the vote being passed. According to Le Figaro, a compromise could be proposed so that drivers would be hired under the current directive and receive the minimum salary of the host country but not any bonuses.

If an agreement is reached, it will be presented to the European Parliament in Strasbourg on Thursday.

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