a Brand New EU Agency in Bratislava

EU Law Analysis: The European Labour Authority: a Brand New EU Agency in Bratislava

The European Labour Authority: a Brand New EU Agency in Bratislava

Bartłomiej Bednarowicz,
PhD Researcher at the Faculty of Law of the University of Antwerp
On Thursday, the
Council decided
that Bratislava will host the headquarters of a brand new EU agency: the European
Labour Authority (ELA). The idea for the ELA was spelt out by President Juncker
already in September 2017 in his annual State of the Union address. Juncker
viewed ELA’s main mission to ensure EU labour mobility in a simple and
effective manner and to strengthen fairness and trust in the internal market.
Interestingly, the proposal to establish the ELA rolled out of the European
Pillar of Social Rights (EPSR) and was presented as a part of the Social
Fairness Package, together with a proposal for a Directive
on transparent and predictable working conditions in the EU (adopted
by the Council on the very same day as the Regulation
establishing the ELA; see discussion of the Directive here),
a proposal for a Council Recommendation
for access to social protection for workers and the self-employed and a Commission
on the monitoring on the implementation of the EPSR.
In a speedy
manner, in March 2018 the Commission put forward a legislative proposal to
establish the European Labour Agency and on Valentine’s Day in 2019, the Commission,
the European Parliament and the Council reached a provisional agreement and
changed the name from Agency to Authority. Finally, in June 2019, the Council adopted
the proposal for a Regulation and selected Slovakia to host the Authority. The ELA
is to start its operations in October 2019 already in Brussels and is expected
to reach its full operational capacity in Bratislava by 2024.
Pursuant to the
Regulation establishing the ELA, the main objective of the Authority is to
assist the Member States and the Commission in their effective application and
enforcement of EU law related to labour mobility across the EU and the
coordination of social security systems. The ELA has the mandate to act only
within the scope of selected EU acts in the framework of: posting of workers,
free movement of workers, social security coordination, social aspects of road
transport and cooperation between the Member States to tackle undeclared work.
This catalogue remains closed but can be extended on a basis of any future acts
that confer tasks on the Authority. More importantly, to maintain its mandate, the
ELA is to neither affect any rights or obligations of individuals or employers
that are granted by either EU or national laws, nor the mandate of national
authorities responsible for enforcement in these fields.
Furthermore, in
order to attain its primary objective, the ELA has been fitted with some additional
tasks. Firstly, it is to facilitate access to information on rights and
obligations regarding labour mobility across the EU as well as to relevant
services. Secondly, it is to promote and enhance cooperation between the Member
States in the enforcement of relevant EU law across the Union, including
facilitating concerted and joint inspections. Thirdly, it is to mediate and help
to look for a solution in cases of cross-border disputes between the Member
States. Finally, it is to support cooperation in tackling undeclared work.
Organisation and the seat selection
The European
Labour Authority will have a permanent structure comprising of a Management
Board (including representatives of the Member States, Commission, European
Parliament and social partners), an Executive Director and a Stakeholder Group
with purely advisory functions (including representatives of the Commission and
social partners). On top of that, the Authority aims at being made up of around
140 staff members, some of them seconded from the Member States. In addition, there
will be one national liaison officer seconded from each Member State who will
facilitate the cooperation and exchange of information between the Authority
and her Member State. The Executive Director, on the other hand, will be
appointed for a five-year term by the Management Board from a list of
candidates proposed by the Commission, following an open and transparent
selection procedure including a hearing before the European Parliament.
Finally, the Commission is willing to secure approximately €50 million for the
Authority’s annual budget.
As for its seat,
4 Member States competed in the selection process: Slovakia, Cyprus, Bulgaria
and Latvia. The Council, in a rather transparent way, steered the selection
process and published on its website all the offers prepared by the governments.
Then, the European Commission assessed the offers based on the geographical
balance, accessibility of the location, availability of the proposed premises
and overall city’s readiness to accommodate the needs of international staff. At
the Council meeting convoked on 13 June 2019, 23 Member States voted in favour
of the Regulation establishing the Authority with its seat in Bratislava, 3
voted against (Austria, Hungary and Sweden) and 2 abstained (Czechia and
Poland). Admittedly, it will be the very first EU agency to be located in
Slovakia that advertised itself with a rather dull slogan ‘ELA in Slovakia, a
good idea’. At least, the ELA’s staff will enjoy the state-of-the-art L12
building at the ‘Eurovea City’ in Bratislava and a stunning view on the Danube
An idea for a (pan)-European
labour inspectorate has been considered for a long time as simply ‘the wishful
thinking’ of some social partners, especially workers organisations. It also
has never really attracted a lot of attention, as the Commission feared scoring
an own goal due to a lack of the Member States’ support to set up such an
agency in the first place. However, the Juncker Commission has finally put the
social rights back at the EU agenda and proposed a rather breakthrough
initiative in a dazzling form of the European Pillar of Social Rights. The
Commission has already delivered quite plenty on the Pillar and mainstreamed many
fruitful debates surrounding the social aspects of employment that under the
years of austerity and flexicurity have been put aside. The Authority indeed emanates
from the EPSR and aligns well with the accompanying proposals presented by the
Commission within a broad framework of European Union cross-border employment
and the Social Fairness Package.
The potential of
the Authority cannot be surely underestimated. Its main advantages can be
summarised in three aspects. Firstly, in the field of legal issues of international employment, it will provide
the national authorities with some valid operational and technical support,
mostly to exchange information, develop some best practices, carry out
inspections and also to settle any disputes. Bridging the information and
cooperation gap between the Member States is indeed a noble objective and quite
a desired one as well. In practice, it is often the case that national
authorities are unable to facilitate dialogue with each other and exchange
information due to the complex and lengthy internal procedures and the language
barrier. Having national liaison officers from all Member States designated to
be at the ELA’s disposal will definitely plug that gap and speed things up. Moreover,
some national authorities might not have even dreamed of an ability of
concerted and joint inspections, which is now a powerful tool in the ELA’s
arsenal, subject however, to reaching an agreement between the Authority and
the concerned Member State(s).
Secondly, what
the enforcement of EU employment and social security law often lacked at
national level, were synergies with
the already existing EU agencies
that would allow to rely on their
expertise in areas such as health and safety at work, the management of an
undertaking that is being restructured, skills forecasting or tackling
undeclared work. Therefore, it is the ELA’s task to facilitate it all to untap
the available potential and to strengthen the enforcement levels.
Finally, the
Authority will simplify cooperation
by integrating a number of existing committees and networks amongst the Member
States which will hopefully lead to eliminating fragmentation in that area.
On the other
hand, the Authority will definitely not serve as a panacea for all the flaws in
the system. The role it will play mostly depends on how active the ELA with its
Executive Director decides to be. There is a considerable room to be claimed by
the Authority with some space for manoeuvre, but there are some open-ended
questions as well. Sceptics and pragmatics may wonder how willing some of the
national authorities will be to cooperate within the ELA’s network and agree to,
for example, conduct inspections on their territory, which can expose the flaws
of their own systems on an EU scale. It is also unsure whether the Member
States known for a rather lenient approach towards social security laws will
deem it in their best interest to assist ELA with the fight against fraud and
abuse on their territories, as no such obligation arises. For them, it could mean
the end of their competitive advantage of providing a legal framework for
cheaper labour through foxy constructions such as letterbox companies.
Examples from
the field of social security coordination and the experience with the
Administrative Commission, a body comprising of government representatives, capable
of reviewing cases of social fraud between the Member States, do not
necessarily instil optimism. The number of successful outcomes of such cases is
rather scarce and some national authorities are giving up on the Administrative
Commission and often try to take matters in their own hands. Essentially, they
reach out on their behalf to the institutions in the other Member States mostly
without any tangible end-effects. Moreover, the Authority’s tasks might overlap
with those of the Administrative Commission, which was a major point of
discussion during the negotiations about the ELA. The exact tasks division,
despite indicated as ‘without prejudice’, might prove to be more problematic to
delineate and can lead to duplication and competence battles. It is also
doubtful how effective the Authority can really be and police the EU labour
mobility market consisting of approximately 17 million EU-movers with rather
modest resources of 140 staff.
To conclude, as
for now, the Authority has baby teeth. It will be up to its adopted strategy,
action plans and frankly, leadership to make sure that it will eventually get
real teeth. The ELA has definitely promising potential but it remains to be seen
how it will be utilised and how big of a dossier can it claim and handle. The
expectations are high so we should all give the European Labour Authority a big
leap of faith and wait for its very first results.
Barnard &
Peers: chapter 20
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