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Background document and questionnaire for EIRO comparative study on 'Economically dependent workers' Background and aims The concept of 'economically dependent workers' refers to those workers who do not correspond to the traditional definition of 'employee'—essentially because they do not have an employment contract as dependent employees—but who are economically dependent on a single employer for their source of income. The debate focuses on emerging employment arrangements which are 'mid-way' between self-employment and dependent employment. Economically dependent workers have some characteristics of both: 1) they are formally self-employed (they usually have a sort of 'service contract' with the employer); 2) they depend on one single employer for their income (or a large part of it). In some cases, economically dependent workers may also be similar to employees from other points of view: 1. lack of a clear organisational separation—i.e. they work in the employer's premises and/or use employer's equipment; 2. no clear distinction of task—i.e. they perform the same tasks as some of the existing employees, or tasks which were formerly carried out by employees and were later contracted out to 'collaborators'; and 3. the 'service' they sell individually to employers falls outside the traditional scope of 'professional services'—i.e. the tasks are simple, do not require specific skills and no professional knowledge or competence is needed. The existence of such employment arrangements has been highlighted by the International Labour Organisation (ILO) and is documented in a number of European countries, such as Italy, UK, Germany, Spain and Portugal. The issue was also mentioned in 2000 in the European Commission's first-stage consultation paper of the social partners on modernising employment relations (EU0007259N). The issue is relevant from the industrial relations' point of view since economically dependent workers do not generally benefit from the protections granted to employees both by law and collective bargaining, including provisions on health and safety, information and consultation, working time, vocational training and social protection. They also fall outside the traditional reach of trade union representation. The aims of this comparative study are to analyse: the scope and relevance of the issue of 'economically dependent workers' in each country; the emergence of demands for regulation of this kind of employment arrangement, as articulated in public debate; where relevant, the ways in which 'economically dependent employment' has been regulated by law, or the contents of existing proposals in this field; and the role of industrial relations, notably whether trade union representation and collective bargaining are being extended to economically dependent workers. Issues Each national centre should provide information on the following points. A) In your country, are there any employment arrangements which could be classified as 'economically dependent' in the sense outlined above? In other terms, are there formally self- employed people who are dependent on one employer (or to few employers) for their income and are not clearly distinguishable from employees as regards the organisation and the content of their jobs (see above for details)? Please illustrate the main features of such employment arrangements. Is there an employment status which is specific to these workers or do they belong to a general definition of self-employment? Indeed, in Spain there are workers who are formally and legally considered as self- employed, but in fact should be considered as "economically dependent workers" (EDWs hereinafter). They depend on one employer or few employers and the type of tasks and the work organisation in which they carry them out is not distinguished from that of other persons who are considered as wage earners. There are examples in all sectors of activity. A very common one is the case of wage-earners who previously worked in transport tasks for the company they belonged to, but now do the same work and for the same company, but as self-employed workers. Another common example is in maintenance of industrial equipment: in many companies this work is performed by self-employed persons who were previously wage-earners of the same company or of another from which they were dismissed. There is no specific status for these workers that distinguishes them from the self- employed. ……………………………………………………………………………………………. B) Even if there are no workers who could be classified as 'economically dependent', please indicate specifically: which are the essential criteria utilised to identify 'employees'; The criteria that at present define the concept of the "worker" are the following: Voluntariness, dependence, working on another's account, receiving wages and providing services personally. a) Voluntariness: the workers must have chosen voluntarily to grant the results of their work to the employer. This requirement stems from the Constitution, which, from different viewpoints, ensures the principle of freedom of work. b) Dependence: this means that the workers must provide the services under the organisation and management of another physical person or legal entity called the employer. The dependence is therefore equivalent to submission to the power of the employer (management, control and discipline). c) Working on another's account: this means that both the result of the work, i.e. the original ownership of the results of the work and the risks in performing them, belong to a person other than the worker, i.e. to the employer. d) Pay: the wages received by the worker in exchange for providing services. e) Providing services personally: this means that the worker cannot be replaced during the course of the labour relationship, which in turn means that the services are provided only by one person. whether the definition of 'employee' is currently the object of any discussion or reconsideration in your country; In recent years there has been a debate on whether the traditional concept of the worker should be brought up-to-date to allow the labour regulations to deal specifically with—and protect—new forms of work or new types of "atypical" workers (workers of temporary employment agencies, contractors and subcontractors of works or services, part-time workers, etc.). Though regulations have been adopted on this, the model that is still considered as standard and forms the core of labour regulations is the (increasingly rare) worker who provides services through a full-time permanent contract for a traditional company. However, the increasing decentralisation of production has led to an increase in self- employment. ##Furthermore, there has been a self-limitation of the subjective area of labour regulations, which is shown in the exclusion of certain groups (insurance brokers, lorry drivers with their own vehicle)##. Jurisprudence has also given greater importance to the desires of the parties with regard to the type of contract (labour or business). if there have been any significant labour disputes, grievances or case law which address the demarcation between 'employee' and 'non-employee' status in order to grant to the latter protections and rights granted to the former, notably as far as workers who could be labelled as 'economically dependent' are concerned. There has been no litigation dealing specifically with the question of EDWs. …………………………………………………………………………………………….. C) Are there data on the number of 'economically dependent workers'? Are there figures on their distribution in the different sectors? In other words, are they particularly present in some specific industries? If so, are there studies available which identify any particular reasons or possible interpretations for this uneven distribution of 'economically dependent workers' across sectors? There are no specific statistics on EDWs. Those available refer to self-employed workers. According to sources of the Ministry of Labour, in Spain there are about 2,500,000 self-employed workers. The number rose steadily from 2,150,000 in 1993 to over 2,570,000 in 2000. Since then, like employment as a whole in Spain, the growth has stagnated. But there is full agreement among the social partners and the experts that the number of EDWs has steadily increased in the last two decades. The self-employed are present above all in services (over 1.8 million persons). The sectors with the greatest presence of self-employed workers are: "retail trading and domestic repairs" (0.62 million), "construction" (0, 33 million), "hotels and catering" (0.28 million), "road transport" (0.20 million), and "other business activities " (0.16 million). The sectors with the greatest relative growth in the number of self-employed in recent years are: "computer activities", "other business activities", and "health; social services". EDWs are abundant in all the above sectors, with the exception of "retail trading and domestic repairs", where the "real" self-employed are the majority. Outsourcing is put forward by the experts as the reason for the use of EDWs Referring to either official statistics or other research such as case studies (please indicate the source), try to provide data on 'economically dependent employment', as far as the following aspects are concerned: The statistical sources on self-employed workers are the record of "Workers affiliated to the Special Social Security System for Self-Employed Workers" provided by the Ministry of Labour and Social Affairs and the "Survey of the Active Population". This provides lower figures for self-employed than we have stated (2.2 million at the end of 2000), though the most detailed figures and those most used are those of the Ministry of Labour. Gender 69% of all self-employed are men and 31% women (771,000). Some of these women (almost 200,000) are classified in the statistics as "family workers". These are persons who work in a family micro-company and their function in it is clearly that of EDWs. Age. The nucleus of the self-employed (and of EDWs, subject to the limitations arising from the statistical identification) are mostly between the ages of 30 and 54 (70%), 17% are over 55 and only 13% are aged 16 to 29. The average age is 43 and there are no considerable differences between men and women in terms of age. . education The distribution by education levels does not show significant differences between self- employed workers and wage-earners job positions and skills. The statistics do not provide figures on this. Case studies such as those referred to in the following section (D) indicate that EDWs mainly occupy jobs with low levels of qualification, though at times they have specific qualifications for the sector in which they are working (workers in industrial maintenance, sales, etc.) ……………………………………………………………………………. D) If there are any relevant statistics or research, please provide information on 'economically dependent workers' with regard to: Some case studies (Lope, A. (1996): Innovación tecnológica y cualificación, CES, Madrid; Grup d'Estudis Sociològics sobre la Vida Qüotidiana i el Treball (2000): ¿Sirve la formación para el empleo?, CES, Madrid; among others), provide the following information any link to reorganisation processes (that is, does the importance of 'economically dependent workers' increase in the event of company restructuring, as to means to reduce costs, increase the firm's adaptability, etc?); Many companies, initially in industry (such as domestic appliance manufacture) and later in services, have restructured their organisation by reducing the workforce and using EDWs, who are often former employees. The main aim of this is to reduce costs and increase flexibility in the use of the workforce. the use of this kind of employment arrangements as a substitute for dependent employees or/and as a possible 'selection mechanism' for future recruitment on a permanent employment contract; Retail trading firms, such as large supermarkets and superstores, use EDWs who sometimes join the workforce of the establishment after their working attitudes have been observed for a time. place of work and integration in the employer's organisation; The places of work of the EDWs are often not distinguished from those occupied by members of the workforce. However, they are not integrated in the organisational structure, unless, as in the above example, they are recruited by it. wage differentials with respect to employees in similar job positions; The pay of EDWs is almost always lower than that of wage-earners in the same position. Even when they receive similar pay, EDWs must pay social security contributions as self-employed workers, so their real incomes are reduced. working time. Formally the timetable of the EDWs is no different from that of the wage-earners in the company for which they work. However, due to the lack of control and the fact that they do not participate in the collective and trade union rights of the company for which they work, their working day is sometimes longer than that of wage-earners on similar jobs. ……………………………………………………………………………………….. E) Is 'economically dependent employment' regulated by law in any respects? Where there are legislative provisions, what is the content of the law? In replying to this question, please refer to the following 'check-list' of issues for potential legal regulation: One of the recent debates in industrial relations has focused on the case of what are called "trades" (trabajadores autónomos dependientes) in Spain, i.e. economically dependent self-employed workers. It has been proposed that they should be covered by at least some labour institutions in order to give them some degree of protection. It has therefore been proposed to provide specific regulations for this type of worker and to consider them as an intermediate type between wage-earners and self-employed worker. At present, the labour regulations have not acted on this. This means that EDWs are currently governed by the regulations applied to self- employed workers. Therefore, civil or mercantile regulations are applied in their contractual relations with the employer/s on whom they depend, and with regard to social protection they are covered by the special social security system for self-employed workers. wage levels; The national minimum wage for all workers could be used as a limit in future legislation, though it is very difficult to apply. At present there is no limit. working time; It is unlikely that limits on working time will be established in future regulation. At present there is no specific regulation. duration and termination of contract; In future regulation, it would be interesting to establish limits to the termination of contracts by the employer without cause, in order to avoid situations of lack of protection. Compensation could also be established for cases in which the contract is terminated for reasons not imputable to the EDWs. However, the duration of the contract must be left in the hands of the contracting parties. At present the civil regulations are applicable. illness and sick leave; They already have health cover under the social security system for self-employed workers. holidays; A future regulation should provide for a holiday period similar to that of wage-earners. A mechanism could be established to replace workers during this period. At present there is no specific regulation. maternity, parental or sabbatical leave; A future regulation must recognise periods of suspension of contract and shorter working hours for childbirth or family care. However, it would be unlikely for workers of this type to enjoy time off to take care of children or family members. The workers could be replaced during this period, and might even appoint their substitutes themselves. At present the regulations on self-employed workers are applicable. collective representation; The articulation of the representation of EDWs raises special problems due to the difficulty of them participating directly in the organs of worker representation in the company to which they provide services. An alternative would be to establish their own exclusive mechanisms of representation. At present there is no regulation. information and consultation; Specific mechanisms of information and consultation must be established for this type of worker. At present there is no specific regulation. training; They should have suitable vocational and continuing training, and effective possibilities of professional retraining, with special emphasis on health and safety at work. They should have access to the training courses on this subject offered by the company to which they are providing services. At present this is governed by the regulations applicable to self- employed workers. health and safety At present they are included in the social security system for self-employed workers. The problem, however, is that this system offers less protection (lower benefits and some benefits are excluded) than the general social security system for employed workers. The protection of the two systems must therefore be brought in line. …………………………………………………………………………………………….. F) Are there any draft bills or legislative proposals on the regulation of „economically dependent employment‟? Please indicate the areas of intervention covered by these proposals, referring to the abovementioned check-list. There are no specific legislative proposals for regulation. However, some specific studies have been made on the measures to adopt. They propose the application of specific labour institutions with regard to health and safety at work, working conditions, organs of representation and collective bargaining, childbirth and family care and training, among others. Measures with regard to social security have also been proposed. Those studies have been drawn up jointly by political parties and trade unions. …………………………………………………………………………………………….. G) Regardless of the existence of legislative provisions, is there a debate on „economically dependent workers‟ in your country which highlights their specificities (in particular, their „dependence‟) and relates to formal recognition (that is the introduction of a specific employment status or the extension of some prerogatives of employees to such workers), especially as regards the protection and rights of this kind of worker? Indeed, there is a debate on the regulation of EDWs, with the aim of giving them specific regulation as an intermediate type between wage-earners and self-employed workers and applying certain specific labour institutions to them. The decisive element for consideration as EDWs is “economic dependence”, normally on a single employer, and the aim of the regulation is to guarantee the protection of certain minimum rights for this increasingly common type of worker. Please indicate specifically whether, and in what terms, such debate covers the issues of: a) wage levels; It is considered very difficult to establish minimum wages, though the national minimum wage could be applied. b) working time; It is considered difficult to establish a maximum limit for working time. c) employment security; No specific proposals have been presented. d) leave periods (illness, maternity, parental or sabbatical leave); It is considered necessary to ensure periods of suspension of the contract and reductions in working time for childbirth or family care. However, it is considered unlikely that EDWs will be able to take time off for childbirth like normal employees. d) trade union representation; A specific trade union federation exclusively for EDWs has been created within the Trade Union Confederation of Workers' Commissions (CCOO). e) information and consultation; It is considered necessary to establish specific mechanisms. f) vocational training; It is considered necessary to develop suitable vocational and continuous training and professional retraining, with special emphasis on health and safety at work. g) social protection; and h) health and safety regulations. At present they are included in the social security system for self-employed workers. The proposal would consist in bringing this social security system in line with that for employed workers. Are any other aspects prominent or relevant in the debate on „economically dependent workers‟ in your country? Which are the areas where proposals for regulation are mostly controversial in this debate? The most controversial element is the type of representation of EDWs in the company to which they provide services, and the way of developing collective bargaining. Pay and working time are also the cause of some problems. In covering the debate, please mention specifically the positions of trade unions and employers' associations on „economically dependent workers‟. There is a certain consensus by the two parties on the need to bring up-to-date the prevailing regulations on self-employment. With regard to EDWs, the debate has been particularly motivated by the trade unions, and there is already a trade union federation devoted specifically to EDWs. ……………………………………………………………………………………………… H) Are there signs of an extension of the coverage of industrial relations to „economically dependent workers‟? Essentially, are there developments relating to the following aspects: Yes, there are some examples of progress in the consideration of EDWs in industrial relations. representation: the creation of new trade union organisations specific to these workers or their representation by existing ones. Please specify the details of any such organisational developments; In 2001 a federation formed exclusively by EDWs and aimed at defending their interests was created in the Trade Union Confederation of Workers' Commissions (CCOO). collective bargaining: the conclusion of collective agreements which cover specifically these workers or the inclusion of chapters on „economically dependent workers‟ within collective agreements at any level (national, sectoral, territorial, company). If such provisions are present, please specify the content of at least one such collective agreement or chapter (as a reference, try to use the check-list provided for legislative regulation, above in question no. 5). In collective bargaining there are no collective agreements at any level that specifically regulate the labour conditions of EDWs and that are applied exclusively to them. This may be due not only to the novelty of the recognition of EDWs but also, among other reasons, to the lack of a specific regulation on the form of representation of this group for the purposes of collective bargaining, and on the content, organisation and effects of this bargaining. However, some references to EDWs are beginning to appear in collective agreements applicable to employed workers, in which they are given some recognition as members of the workforce of a company. ………………………………………………………………………………………………………………… I) Is the issue of „economically dependent workers‟ (whatever the actual definition utilised in your country) present on the trade union agenda? What are the main strategies, if any, that unions are discussing and implementing with respect to these workers? In addition to integrating them in the trade union structure, as the Trade Union Confederation of Workers' Commissions and the General Workers' Confederation have done, the trade unions attempt to find formulas that allow some form of collective representation of EDWs in the company in which they work. They are also debating how these workers should be included in the organisation of collective bargaining. …………………………………………………………………………………………. J) Please, give the NC assessment of the issue of „economically dependent workers‟ in your country, its present relevance and possible future developments, notably as far as industrial relations are concerned. As stated above (H and I), though today EDWs are not regulated by collective bargaining, the trade unions are trying to find mechanisms to include them in it. One of the options that is being discussed is the possibility of including EDWs in company agreements. Their employment conditions would then be regulated by the agreement of the company in which they work. The problem is that this would leave outside the framework of collective bargaining the EDWs who work for companies without their own agreement. At present no progress has been made on the possibility of defining a specific agreement for all EDWs; this is complicated due to the diversity of sectors and working situations in which this group is involved. Length and format National responses should be up to 2,000 words in length. Important: Please use the special EIRO record template sent out with this questionnaire to respond, filling in the answer to each question underneath that question, and then submit it in the normal way. If you have any queries on administrative issues (deadlines, submission etc.), please contact Shivaun Lindberg in the first instance. If you have any queries on the content of the information requested, please contact the Italian National Centre (Roberto Pedersini and Framework Trentini), which is coordinating the study. Timing The deadline for the submission of responses to the normal EIRO submission e-mail address by national centres is 15 February 2002. The procedure after that date is as follows: 4. EIRO technical editor passes on national responses to coordinating national centre— Italy. 5. Coordinating national centre produces comparative text. Coordinating national centre returns comparative text to EIRO editing unit for final edit by 28 March 2002. 6. Editor makes queries to national centres and coordinating national centre, as necessary. 7. Comparative text formatted and loaded onto database by 26 April 2002.
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