Social and employment policy: general principles

The social dimension of European integration has been greatly developed through the years. It is a key aspect of the Europe 2020 strategy, which aims at ensuring ‘inclusive growth’ with high levels of employment and a reduction in the number of people living in poverty or at risk of social exclusion.

Legal basis

Article 3 of the Treaty on European Union (TEU), and Articles 9, 10, 19, 45-48, 145-150 and 151-161 of the Treaty on the Functioning of the European Union (TFEU).

Objectives

The promotion of employment, improved living and working conditions, proper social protection, dialogue between management and labour, the development of human resources with a view to lasting high employment and the combating of exclusion are the common objectives of the EU and its Member States in the social and employment fields, as described in Article 151 TFEU.

Achievements

a.From the Treaty of Rome to the Maastricht Treaty

In order to allow workers and their families to take full advantage of the right to move and seek employment freely throughout the common market, the Treaty of Rome provided for the coordination of the Member States’ social security systems. It enshrined the principle of equal pay for men and women, which was recognised by the Court of Justice as being directly applicable, and provided for the establishment of the European Social Fund (ESF) (5.10.2).

Concerns about structural imbalances and uneven growth in Europe later led to a more proactive social policy at Community level. In 1974, the Council adopted the first Programme of Social Action.

The Single European Act (SEA) introduced provisions for the harmonisation of health and safety conditions at work. Acting by qualified majority in cooperation with Parliament, the Council adopted a number of directives laying down minimum requirements in this area. The SEA also made it possible for the social partners at European level to negotiate collective agreements, and established a Community policy for economic and social cohesion.

Consensus grew around the need to pay more attention to the social aspects connected with the completion of the internal market. Following long debates, the Community Charter of the Fundamental Social Rights of Workers (Social Charter) was adopted at the Strasbourg Summit in December 1989 by the Heads of State or Government of 11 Member States, with the United Kingdom opting out.

With the signing of the Maastricht Treaty, the promotion of a high level of employment and social protection was officially introduced as one of the tasks conferred on the European Community (EC). However, having been unable to reach a unanimous agreement during the intergovernmental conference, 11 Member States decided to move ahead by concluding an Agreement on Social Policy, thereby exempting the UK from participation (Protocol No 14 to the Treaty).

b.From the Amsterdam Treaty to the Treaty of Lisbon

The awkward situation of having a double legal basis, created by the UK opt-out, was finally overcome with the signing of the Amsterdam Treaty, when all the Member States, including the UK (following a change in government), agreed to incorporate the Agreement on Social Policy into the text of the EC Treaty with some slight changes (Articles 151-161 TFEU). In Article 153, the co-decision procedure replaced cooperation and was also extended to provisions relating to the European Social Fund (5.10.2), the free movement of workers and social security for Community migrant workers (5.10.4). The new Article 19 conferred on the EC the ability to ‘take appropriate action to combat discrimination based on sex, racial or ethnic origin, religion or belief, disability, age or sexual orientation’. On this basis, two directives were soon adopted: Directive 2000/43/EC on equal treatment between persons irrespective of racial or ethnic origin and Directive 2000/78/EC on a general framework for equal treatment in employment and occupation.

The Amsterdam Treaty also included the promotion of a high level of employment among the EU objectives and conferred on the EC a responsibility to support and complement the activities of the Member States in this area to encourage cooperation between them and to develop a ‘coordinated strategy’, namely the European Employment Strategy (EES) (Articles 145-150 TFEU), based on an open method of coordination (OMC) (5.10.3).

When launching the Lisbon Strategy in March 2000, aimed at making the EU the most competitive economy in the world, the Heads of State also recognised that economic growth was not in itself sufficient to fight poverty or the danger of social exclusion. The OMC would later be extended to pensions, health and long-term care as part of the ‘social OMC’.

The year 2000 also saw the adoption, at the Nice Summit, of the Charter of Fundamental Rights of the EU, drafted by a special Convention. A Social Protection Committee was created to promote cooperation between Member States and the Commission (Article 160 TFEU) on social protection policies, but all proposals to expand the co-decision procedure were rejected.

In the light of the mid-term review of the Lisbon Strategy in 2005, the employment guidelines adopted as part of the EES were incorporated into the integrated guidelines for growth and jobs, and the Lisbon reform process was synchronised with the social OMC on the basis of three-year cycles.

A new social agenda for the 2006-2010 period was adopted in 2005 to accompany the relaunch of the Lisbon Strategy. An EU programme for employment and social solidarity, called Progress, was established for the 2007-2013 period to support the implementation of the EU’s objectives in the social field (5.10.9). In 2007, a European Globalisation Adjustment Fund (EGF) was created to provide support for workers made redundant as a result of changing global trade patterns (5.10.2).

The Treaty of Lisbon was signed on 13 December 2007, allowing for further progress in consolidating the social dimension of European integration. The Treaty on European Union now emphasises the EU’s social objectives, including full employment and solidarity between generations (Article 3); Article 6 recognises the Charter of Fundamental Rights as having the same binding force as the Treaties. The Charter itself recognises so-called ‘solidarity rights’, such as workers’ right to information and consultation, as well as the rights to collective bargaining, fair and just working conditions, social security and social assistance. A horizontal social clause was introduced into the TFEU, reading as follows: ‘in defining and implementing its policies and activities, the Union shall take into account requirements linked to the promotion of a high level of employment, the guarantee of adequate social protection, the fight against social exclusion, and a high level of education, training and protection of human health’ (Article 9).

c.Developments since the Lisbon Treaty

In July 2008 the Commission published a renewed social agenda entitled ‘Opportunities, access and solidarity in 21st century Europe’ in response to growing unemployment due to the financial and economic crisis. Measures were introduced to enhance the impact of existing financial instruments (the ESF and the EGF). In addition, a new European Progress Microfinance Facility was set up in 2010 to provide microcredit to small businesses and unemployed people wishing to create or further develop their own business.

Inclusive growth (fostering a high-employment economy that delivers social and territorial cohesion) is one of the priority areas of the Europe 2020 strategy, the successor to the Lisbon Strategy. The new EU strategic agenda mentions for the first time a clear target for its ‘social’ pillar (the objective of lifting 20 million people out of the risk of poverty by 2020), together with a renewed commitment to an ambitious goal in the area of employment (75% employment for the 20-64 age group). Of the seven flagship initiatives selected to help achieve the Europe 2020 targets, three fall within the areas of employment and social affairs: the Agenda for New Skills and Jobs is aimed at revamping flexicurity policies to make the labour market function better, helping people develop the skills of tomorrow and improving job quality and working conditions; Youth on the Move contributes to better education and training, helps young people to study abroad and makes it easier for them to find a job; and the European Platform against Poverty and Social Exclusion helps to disseminate best practices and makes funding available in order to support social inclusion and combat discrimination (see fact sheet 5.10.9). Since 2010, the headline employment and social targets of the Europe 2020 strategy have served as goals for the benchmarking of the EES. This has been included in the European Semester, which provides a framework for coordinating and monitoring progress in macroeconomic, fiscal, employment and social policies in recurring yearly cycles. In response to increasing poverty levels, in 2014 the Fund for European Aid to the Most Deprived (FEAD) was established. It provides food and basic material assistance, together with social inclusion activities.

In April 2017, in a bid to move towards a deeper and fairer Economic and Monetary Union, the Commission, having identified a social Europe as one of the key priorities for the Juncker Commission, presented a communication on the European Pillar of Social Rights (EPSR). The Pillar sets out 20 key principles and rights to support fair and well-functioning labour markets and welfare systems, which are structured around three categories: (i) equal opportunities and access to the labour market, (ii) fair working conditions, and (iii) social protection and inclusion. The Social Pillar is accompanied by a ‘social scoreboard’ to monitor progress (5.10.9).

Role of the European Parliament

Although Parliament’s role has long been a purely consultative and supervisory one, it has always been active in the development of EU action in the field of employment and social policy, with a view to strengthening the EU’s capacity to combat unemployment and improving working and living conditions for all. Since the early stages of European integration, Parliament has often called for a more active policy in the social field so as to reflect the increasing importance of the Union in the economic area, and has supported the Commission’s different proposals in this area. Parliament was more closely involved in the preparation of the Treaty of Amsterdam than in previous Treaty revisions, and some important innovations reflect its recommendations, such as the incorporation of the Social Agreement and the insertion of an employment chapter.

At the time of the Lisbon Strategy, Parliament insisted on the role that employment and social considerations should play in the design of growth strategies to be implemented at EU and national level. It recalled that a high level of social protection was central to the Lisbon Strategy, considering it unacceptable that people should be living below the poverty line or in a position of social exclusion. Parliament also took the view that the Lisbon Strategy did not set sufficiently binding targets in the social sphere, and called on the Member States to monitor closely the employment and social impact of the reforms implemented as part of the Europe 2020 strategy. Along the same lines, one of the messages conveyed by Parliament while debating the economic crisis was a firm call for an EU commitment to preserving European social models and a strong social Europe.

Since the headline goals of the Europe 2020 strategy are monitored and implemented as part of the European Semester process, Parliament has repeatedly insisted on incorporating the employment and social goals more effectively into the European Semester, inter alia through making social indicators binding and extending indicators to cover child poverty and decent work, for example. It also deeply regrets the fact that its role in the European Semester is of a limited nature, and has called for an inter-institutional agreement enabling it to become more involved in the process.

Finally, Parliament has been highly critical as regards measures, such as economic adjustment programmes, taken outside the supranational framework. In March 2014 Parliament stated that only genuinely democratically accountable institutions should steer the political process of designing and implementing the adjustment programmes for countries in severe financial difficulties.

Parliament has also confirmed its attachment to social values in deciding on the use of financial resources from the EU budget. Most recently, Parliament managed to ensure that the European Social Fund (ESF), Europe’s main tool in the fight against unemployment and social exclusion, accounts for 23.1% of global EU cohesion funding, and that 20% of each Member State’s ESF allocation will have to be spent on social inclusion.

In its resolution of 25 February 2016 on the European Semester for economic policy coordination, Parliament called on the Commission and the Member States to take action to boost upward social convergence in the Union. It also called on the Commission to define and quantify its concept of social fairness. A similar call was stressed once again in Parliament’s resolution of 15 February 2017.

On 19 January 2017, Parliament adopted a resolution on the European Pillar of Social Rights. While fully embracing the Commission’s initiative in this field, the resolution underlined the importance of enforcing a core set of rights for everyone and called on the social partners and the Commission to work together to present a proposal for a framework directive on decent working conditions.

Susanne Kraatz

06/2017