This week (21 March 2018), the leading European Parliament's Committee on Internal Market and Consumer Protection (IMCO) has rejected the proposal on a Services e-card. This is an important success, as the draft law would have contributed even further to wage and social dumping in the EU. Right from the start, the Chamber of Labour had pointed out that the Services e-card does not generate any added value but would promote bogus self-employment and the setting-up of letterbox companies.

In January 2017, the European Commission had presented a Directive and a Regulation proposal on the introduction of an “Electronic European Services e-card”. According to the EU Commission, the introduction of a European Services e-card should significantly facilitate the provision of cross-border services. Numerous labour organisations, including the Chamber of Labour, had pointed out the dangers of the proposal right from the start.

Services e-card: Bogus self-employment and more bureaucracy

Restrictions for the destination countries concerning the issue and withdrawal of the Services e-card in the draft legal proposal, would have meant a loss of important control competencies at national level. For example, even in cases of established violations, the host country would not have been able to withdraw the services e-card. In addition, extremely short deadlines would have been provided for the approval procedure. Exceeding the provided for processing times would have resulted in approval fiction. This would have meant that legal standards of the destination country would not have applied at all. For all these reasons, the planned Services e-card would have facilitated bogus self-employment. It would have been easy to bypass collective and wage agreements, which would have opened the door wide to wage and social dumping.

The Services e-card would also have resulted in additional bureaucracy: apart from the single contact points that were introduced within the scope of the Services Directive another responsible authority was to be created with the Services e-card. The added value of this additional authority would have been not clear as the existing system already allows the electronic processing of administrative procedures.

Joint letter of Chamber of Labour and trade unions

Prior to the vote, Chamber of Labour, in a joint letter with the Austrian Trade Union Federation, the German Trade Union Confederation, the Central Organisation of Finnish Trade Unions, the Dutch Trade Union Federation as well as Swedish, Danish and Belgian Trade Union Federations, has once again emphasised the most important points of criticism from an employee perspective and urgently warned against introducing the Services e-card.

Prior to the vote in the leading Committee on Internal Market and Consumer Protection and in keeping with the spirit of the labour organisations, all other contributing committees of the EU Parliament (Committee on Industry Research and Energy, Committee on Economic and Monetary Affairs, Committee on Legal Affairs, Committee on Employment and Social Affairs) had voiced their opinion. They shared the concerns regarding the Commission's initiative and asked the competent Committee on Internal Market and Consumer Protection to reject the legal proposals of the EU Commission on introducing the Services e-card.

Further information:

AK Position Paper on the Electronic European Services e-card

A&W Blog: European Services e-card as a new tool for pseudo self-employed people

AK EUROPA: Fair competition and fairer labour market in der EU?

AK EUROPA: Services e-card: Free ride for pseudo self-employed people and letterbox companies?

Release MEP Evelyn Regner, 21.3.2018: Red card against social dumping!