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Labour citizenship and enforcement gaps in a Pan-European labour market

An assessment of the Enforcement Directive of the Posting of Workers Directive

In 1996, the EU adopted the Posted Workers Directive. The purpose of this Directive was to improve the protection for migrant workers, who are posted temporarily to work in another member state. However, decisions of the European Court of Justice in the Viking and Laval lines of cases have seriously limited the level of protection afforded by the 1996 Directive. These judgments have proved politically controversial and have created significant industrial tensions across the EU. As a result of pressure from trade unions and some national governments, the Commission decided to introduce proposals for an Enforcement Directive of the Posting of Workers Directive (hereafter the Enforcement Directive).

Posted workers in the European Union

The European Commission estimates that in 2011, a total of 1.51 million A1 documents were recorded across the EU-27 and Iceland, Liechtenstein and Norway (European Commission, 2012). In comparison to data from 2010 (1.33 million) and 2009 (1.27 million) there is a strong increase in posting. In 2011, around 60% of all postings (compared to 63% in 2010) originated in the EU Member States that joined the EU before 2004 and almost 40% (compared to 37% in 2010) in the EU-12 Member States who joined in 2004 and 2007. The main sending countries of posted workers in 2011 were Poland, Germany and France followed by Romania, Hungary, Belgium and Portugal. Germany and France were the main receiving countries followed by the Netherlands, Belgium, Spain, Italy and Austria (European Commission, 2012). However, the A1 data, which provides the only current statistical source of information on postings, have serious limitations because many employers do not fill out or forge the A1 forms. Widely used practices such as bogus self-employment, also lower the recorded numbers of worker postings.

The legislative procedure of the Enforcement Directive

In April 2014, the European Parliament adopted the Enforcement Directive of the Posting of Workers Directive. Its main purpose, as the name indicates, is to ensure that there is consistent application and more effective enforcement of posted workers’ rights contained in the 1996 Posting of Workers Directive. It is important to note that the final version of the Enforcement Directive of the Posting of Workers Directive was not negotiated via the co-decision procedure. Rather, the final text was decided via the trilogue. The trilogue negotiations are a formal procedure in EU law and mainly take place when the Council of Ministers cannot agree to the proposed changes from the European Parliaments through the co-decision process.

One advantage of the trilogue is that it speeds up the decision making process. In this case, the European Commission and the European Parliament wanted to arrive at a quick decision because the directive needed to be agreed upon before the elections of the European Parliament in 2014. The disadvantage of the trilogue is that it basically leaves the negotiations to a few actors that agree on a final text. Further negotiations with other actors do not take place at this point in time anymore. Moreover, the European Commission’s endorsement is particularly important in these negotiations, in view of the fact that, if it opposes an amendment which the European Parliament wants to adopt, the Council will have to act unanimously to accept that amendment. In the trilogue on the Enforcement Directive representatives of the European Parliament, the Council and the Commission attended these informal tripartite meetings. The agreement reached in the trilogues is informal and "ad referendum". The European Parliament approved the final text in its formal procedure in April 2014.

The Final Text of the Enforcement Directive

During the negotiations of the Enforcement Directive four issues have caused heated debates among the policy-makers and social partners in particular:

• Genuine posting (Article 4)

In recent years, there has been growing evidence of companies developing bogus arrangements to restrict the rights of posted workers, as a means of reducing costs. These include the use of bogus self-employment arrangements, bogus temporary agency work arrangements and of ‘letter box companies’ in lower wage economies. The Enforcement Directive seeks to define a genuine posting more precisely. However, the criteria listed in the Directive focus only on the contractual terms which could be fictitious.

Moreover, the text does not specify which legal framework applies in the case of abuse. Trade unions demanded a clear definition of which law would apply to a worker who is under a de facto but not a de jure posted employment relationship (such as bogusly self-employed workers). The demand was for the Enforcement Directive to clearly state that in the aforementioned case the worker would be covered by the entire legislation of the host country. However, after the trialogue negotiations the reference to bogus-self-employment is not legally binding and was included in Recital 10 of the Directive.

• Monitoring Compliance (Article 9 and 10)

The Enforcement Directive adopted an ‘open list’ approach of control measures, permitting member states to adopt additional enforcement measures not specified in the Directive and to decide the level of control measures used in their own country to monitor the flow and working conditions of posted workers. However, it also states that all control measures will be subject to a proportionality test and will be supervised by the Commission. Even though the European Commission has an institutional duty to monitor compliance, this responsibility is usually not written in Directives. There is the danger that foreign companies may argue that certain national requirements are disproportionate and unduly restrict their ability to post workers to another EU member state. Therefore, the concern is that Article 9 still places restrictions on the use of control measures by Member States. For Member States, it is important to have flexibility to adopt additional measures in response to a change in circumstances or new avoidance tactics by employers.

• Enforcement of rights through supply chains - joint and several liability (Article 12)

Social partners of several EU countries pushed for a main-contractor liability for all the elements in the subcontracting chain (European Federation of Building and Woodworkers, 2012). According to Article 12 of the Enforcement Directive, only “the contractor of which the employer is a direct subcontractor” would be held liable. This provision only applies to the construction sector. It is left to the member state to determine the exact tools to enforce such abuse in the subcontracting chain as well as potentially extend the liability to other sectors, too. However, the relevant enforcement measures to enforce the rights of workers through supply chains, as well as the monitoring of compliance more generally, need to be ‘justified’ and ‘proportionate’ in order to avoid creating a barrier, or an obstacle to the free provision of services. In fact, throughout the Enforcement Directive the attention to ‘proportionate’ measures alerts member states to maximize their own tools to avoid infringement procedures.

• Administrative Cooperation (Articles 14-19)

The Enforcement Directive identifies the IMI system (Internal Market Information) as a key tool to ensure administrative cooperation between Member States in the context of the transnational posting of workers. The IMI is a free software available to users via the Internet, created by the European Commission in collaboration with Member States, in order to simplify and facilitate administrative cooperation and the exchange of information across borders, providing, in addition, the respect of the processing of personal data in accordance with Directive 95/46/ EC and the principles of proportionality and necessity.

A recent report on the administrative cooperation via the IMI system (Enfoster, 2015) found several urgent improvements in the IMI system that are not addressed by the enforcement directive:

  1. The questions in the IMI system need to be revised.
  2. More relevant National competent authorities should be introduced to the IMI system.
  3. Training needs to be provided to the users involved in this administrative cooperation.

The Enforcement Directive did enhance quicker response periods. The Directive time limits by which authorities of other member states have to respond to requests for assistance (for example a 2-working-day limit to respond to urgent requests and a 25-working-day limit for non-urgent requests).

However, how the actual collection of fines is to be achieved is unresolved. Fines imposed on a posting firm cannot be executed effectively because they are based in a different jurisdiction. Moreover, Art. 18 [1] introduces the right for the service providers to contest the fine, penalty and/or underlying claim. If such a dispute arises, the cross-border enforcement procedure of the fine or penalty imposed will be suspended pending the decision of the appropriate national authority in the matter. Companies making a business model out of worker posting may be able to use this provision as a tool to postpone real execution. In that sense, companies are still able to profit, and can strategize around the fact that they are registered in another jurisdiction.


The final document of the Enforcement Directive has been rushed through the trialogue process in advance of the European elections. It aims to improve the enforcement of rights of posted workers in cross-border situations by proposing, amongst other things, a guide for member states to cooperate in enforcement matters related to posted workers. For instance, the directive stipulates the general principle of mutual assistance and certain time frames within which member states need to share information from competent authorities in another member state are specified. In general, this may take a maximum of 25 days, and in urgent cases, needs to be provided within two working days from the receipt of the request. This is generally recognized as an improvement.

However, much of its content codifies already-existing regulatory measures at the national level. It is a missed opportunity to tackle the underlying structural issues and effectively protect posted workers from abusive practices. The final text has faced criticism from many actors. France criticized the absence of provisions governing the social security treatment of posted workers, both in the 1996 Directive, and in the new directive[1]. The German Trade Union Federation (DGB) believes that the Directive should have stipulated the right of posted workers to legal counseling.

German MEP Jutta Steinruck (SPD) is critical of the inadequate scope of responsibility within the subcontractor chain and its limitation to the construction sector only. The limitation to the construction sector does in fact exclude the protection of many posted workers in other industries such as meat processing, ship-building, or logistics. The British Trade Union Congress (TUC) criticises both the possible restriction of control mechanisms in the member states, and the still-inadequate definition of posting of workers, which does not respond to the issue of feigned self-employment. Whilst the Enforcement Directive may encourage increased co-operation and co-ordination between member states, it is unlikely to prevent the abuse of posted workers across the EU. There is a serious risk that employers will continue to use posted workers, circumvent their rights and undercut local standards.

This article was written as part of the "Testing EU Citizenship as 'Labour Citizenship': from Cases of Labour Rights Violations to a Strengthened Labour Rights Regime" project. The project is financed by the European Commission grant in the Europe for Citizens programme.
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Directive 2014/67/EU of the European Parliament and of the Council of 15 May 2014 on the enforcement of Directive 96/71/EC concerning the posting of workers in the framework of the provision of services and amending Regulation (EU) No 1024/2012 on administrative cooperation through the Internal Market Information System (the “IMI Regulation”).

EU Commission 2012. Posting of workers in the European Union and EFTA countries: Report on A1 portable documents issued in 2010 and 2011.

European Federation of Building and Woodworkers (2012). Zusammenfassung der EFBH-Analyse des Vorschlags für eine Richtlinie (KOM(2012)131) zur Durchsetzung der Entsendungsrichtlinie 96/71/EG.

Enfoster Brief no.1” “Posting of workers within the EU: some practices and reflections about social dialogue and administrative cooperation” January 2015. Accessed online 17 June 2015:http://cdt2.tagliacarne.it/Archivio/65/brief_1_en_final.pdf

Ines Wagner
Ines Wagner is a postdoctoral fellow at the Institute for Work and Qualification at the University of Duisburg-Essen. She received her double Ph.D. degree with distinction from the University of Groningen and the University of Jyväskylä. She read Global Politics at the London School of Economics and Political Science and European Studies at the University of Maastricht. Her articles on posted work and transnational employment relations in a pan-European labor market have been published, among others, in the British Journal of Industrial Relations, the Journal of Common Market Studies and the Journal of Ethnic and Migration Studies.
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