The Directorate-General Employment, Social Affairs and Inclusion launched a public consultation on possible future initiatives for the enforcement of EU rules on free movement of workers. The objective of the consultation was to assess how to best ensure the enforcement of the right to free movement of workers and contribute to the removal of obstacles.
EFIP strongly feels that independent professionals face significant barriers when looking to work across borders and that this situation urgently needs to be addressed in order to maximize the value that they add to the EU economies.
EFIP’s full response:
‘According to your experience, what are the main problems that EU citizens face when working in another country of the European Union?’
EFIP strives for the European social and business environment to become more conducive to the independent way of working. Although EFIP supports the removal of barriers to growth for business as a whole, our submission to this consultation is exclusively concerned with how the Commission can encourage independent professionals, sometimes referred to as self employed workers or freelancers, to continue to add value to the European economy. To this end EFIP would welcome the removal of administrative burdens for those independents seeking to work across national borders within the EU.
Independent professionals are genuine businesses on their own account. They are typically required to comply with the same regulations as any other business despite having far less resources at their disposal. Compliance with local business and tax regulations is often confusing for independents. Private sector service companies can provide assistance to independents seeking to set up in other EU states but this assistance can be prohibitively expensive.
Furthermore independent professionals who do manage to comply with regulations often find themselves at a tax disadvantage as they may be subject to ‘double taxation’ i.e. they are expected to pay tax in both their country of origin and the country in which their client(s) are based. Although Tax Treaties do exist to try and address this anomaly these too are often so confusing that even national tax collection agencies are unsure of how much tax they are owed. These tax issues are undoubtedly burdensome for larger companies to deal with but for independents they can be cripplingly difficult to address.
In addition to overly complex regulations there is anecdotal evidence to suggest that there exists in some countries a cultural resistance to the awarding of contracts to foreign workers. Despite the Single Market Act, some national labour markets still exhibit protectionist characteristics.
EFIP’s member organisations have found that some countries are better than others at protecting workers against discrimination on grounds of nationality. EFIP believes that the Commission should conduct research into which member states are the most welcoming to foreign workers and which states have in place the most barriers. The findings of this research could then be shared to encourage best practice.
There is anecdotal evidence to suggest that independents professionals looking to work across borders within the EU face great difficulties in complying with regulations. Seemingly straight forward administrative processes such as registering at a tax office can prove to be insurmountable barriers. Furthermore it is often the case that certain roles within countries require qualifications which are specific to that country. The Commission should look at ways to encourage certain industries to accept foreign qualifications.
These protectionist tendencies are often reinforced by powerful trade unions. They are able to put pressure on national Governments to prevent their labour markets from being as accessible as they should be to workers from other EU member states.