Law on promotion of minority employment to be scrapped

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The Dutch Employment of Minorities (Promotion) Act, which seeks to promote equal representation of people from ethnic minorities in the workforce, expires on 1 January 2004 and the government does not plan to prolong it. This decision has been supported by employers, but trade unions and the political opposition want to retain some or all of its provisions. The decision to scrap the Act comes at a time when latest figures indicate that the labour market position of people of foreign nationality or extraction may be starting to worsen, following earlier progress. Meanwhile, there has been a debate in late 2003 over the policy to adopt towards labour migration from new Member States joining the EU in 2004.

In late 2003, the position of people of foreign nationality or extraction in the Dutch labour market has been highlighted by the publication of a number of reports, changes to legislation and debate over labour immigration from the new EU Member States.

Position of foreign nationals

In October 2003, the Social and Cultural Planning Office (Sociaal Cultureel Planbureau, SCP) published its annual 'minorities report' on the position of people from ethnic or national minorities (Rapportage minderheden 2003. Onderwijs, arbeid en sociaal-culturele integratie[Minorities report 2003. Education, employment and socio-cultural integration], SCP, 2003), while in November the Central Statistical Office (Centraal Bureau voor de Statistiek, CBS) published its annual report on people of foreign nationality or extraction (Allochtonen in Nederland 2003[Foreign nationals in the Netherlands 2003], CBS, 2003).

The two reports paint a positive picture of the progress made by people of 'non-western' foreign nationality or extraction in education and the labour market in the Netherlands. However, both studies point out that, despite such progress, there is still much room for improvement. Furthermore, progress has come to a standstill in the labour market in the face of the current economic slowdown and decline may even be setting in.

The educational level of people of foreign nationality or extraction is rising faster than for 'native' Dutch nationals, spectacularly so in some categories. Whereas in 1988, 90% of all people of Moroccan background living in the Netherlands had completed only primary education at most, this figure had dropped to 57% by 2002. In 1991, 3% of all people of Moroccan background in the Netherlands had completed intermediate vocational education or higher. By 2002, this figure had risen to 29%.

Despite having gained ground in terms of educational levels, people of foreign nationality or extraction still lag far behind in other areas. The figures for those without initial qualifications are far higher among this than for 'native' Dutch nationals - 65% for all people of Moroccan background, 30% for young people from Turkish and Moroccan backgrounds and 12% for people from Surinam and the Antilles, compared with 4% for Dutch 'natives'.

While the situation has been improving gradually in terms of education, this cannot be said for the labour market. Despite people of foreign nationality or extraction having gained an enormous amount of ground in the second half of the 1990s (unemployment figures for people of Moroccan nationality or extraction dropped from 40% to 10%, and from more than 30% to 10% for people of Turkish and Surinamese nationality or extraction), progress has now come to a standstill in the face of the economic downturn. There has even been a slight increase in the level of unemployment among people of non-western foreign nationality or extraction. Unemployment among young people in this category has risen so sharply over the past few years that SCP has sounded the alarm. As many as 30% of young people with Surinamese and Antillean backgrounds are without formal employment. SCP points out that many young people of Moroccan and Turkish origins are not actively engaged in seeking employment and are therefore excluded from the statistics. Finally, it is noteworthy that unemployment among highly qualified people of foreign nationality or extraction is three times as high as it is for similar native Dutch nationals.

Legislation on minority employment abolished

At a time when the position of people of foreign nationality or extraction in the labour market is again worsening, numerous measures previously adopted by government and businesses to promote their labour market participation appear to be drawing to a close. Over 2003, there has been a great deal of discussion on this issue, especially with respect to the proposed abolition of the Employment of Minorities (Promotion) Act (Wet Stimulering arbeidsdeelname minderheden, SAMEN). This Act is seen as the basis of policy on the employment of people from minority groups, since it delivers the information required to formulate the foundations of such a policy. The most important obligations on employers arising from the Act include maintaining separate personnel registers and drafting an annual report on minority employment. The Act aims to achieve equal representation of people from minorities in the workforce.

The Act was adopted in 1998 and originally intended as a temporary measure (NL9805176F). It was subsequently extended once until 1 January 2004. The government does not intend to extend the Act again. The stated reason for this is that the original aim of making employers aware of the position of foreign nationals and people from ethnic minorities within their companies has been achieved and that the impact on concrete improvements in the position of such people is not demonstrable. The Ministry of Social Affairs and Employment has arrived at this conclusion on the basis of an evaluation of the Act. Another reason underlying discontinuation of the Act is that government aims to lower the administrative burden for employers. The government has put forward the following alternatives to the legislation:

  • voluntary registration of employment of foreign nationals and people from ethnic minorities;
  • establishment of a National Diversity Management Centre (Landelijk Centrum Diversiteitsmanagement);
  • establishment of an 'ambassador network' among employers; and
  • concluding agreements with various sectors.

The government intends to discuss this matter with the bipartite Labour Foundation (Stichting van de Arbeid, STAR). In the meantime, the lower chamber parliamentary parties of the opposition social democratic Labour Party (Partij van de Arbeid, PvdA) and Green Left (Groenlinks) have submitted proposed legislation aimed at extending application of the SAMEN Act. They state that the Act is being scrapped at a time when people of foreign nationality or extraction are facing major challenges in the labour market.

Social partner positions

The largest employers’ association, the Confederation of Netherlands Industry and Employers (Vereniging Nederlandse Ondernemers-Nederlands Christelijk Werkgeversverbond VNO-NCW), supports the government's intended discontinuation of the SAMEN Act, along with its underlying analysis. Employers argue that the Act served its purpose in a period when unemployment was rife among people of foreign nationality or extraction. Now that this is no longer the case and these groups in fact enjoy better prospects in the labour market in the current phase characterised by an ageing population, the Act is no longer required. If registration of the employment of people of foreign nationality or extraction were to be applied, this could be achieved at a macro or regional level (by SCP or CBS) in order to identify trends in labour market participation. Employers assert that the Act has in fact become counterproductive because it stigmatises people of foreign nationality or extraction and insufficiently differentiates between different groups. The time has come to 'normalise' employment policy for people of foreign nationality or extraction. The employers concur with the alternatives proposed by government.

Organisations representing minority groups, along with the Dutch Trade Union Federation (Federatie Nederlandse Vakbeweging, FNV), and Christian Trade Union Federation (Christelijk Nationaal Vakverbond, CNV), are calling for continuation of the registration obligation stipulated in the SAMEN Act, as a point of reference for social action vis-à-vis companies and as a source of knowledge for policy formulation. They perceive a threat in the current economic situation for many employees of foreign nationality or extraction, who are at twice the risk of losing their jobs in comparison with their Dutch counterparts in the labour market. FNV is therefore calling for policy directed at retaining people of foreign nationality or extraction in the workforce. Support for the alternative measures formulated by government, such as those directed at promoting diversity management, fits in well with this. However, according to the unions, targeted recruitment remains necessary.

Immigration from new EU Member States

In May 2004, 10 new Member States from central, eastern and southern Europe will join the European Union, and there will potentially be a subsequent rise labour migration to the Netherlands. This raises a new issue related to foreign nationals, though whether this should be seen as a problem is still a topic of debate.

A majority in the lower chamber of parliament - including the ruling Christian Democratic Appeal (Christen Democratisch Appèl, CDA) and liberal Party for Freedom and Democracy (Vereniging voor Vrijheid en Democratie, VVD), the right-wing Lijst Pim Fortiyn, (LPF) and the smaller Christian parties - is considering imposing barriers against an influx of cheap labour from the new Member States in eastern Europe. This could be achieved by exercising the option provided by transitional arrangements agreed by the EU and these countries, allowing the existing Member States to limit movements of workers from the new Member States for a period after enlargement. The fact that Germany and Austria will be taking up this option provides the government with reason to fear an influx of workers into the Netherlands, especially from Poland. Given the less-than-favourable labour market situation, the government does not believe this would be desirable. It has postponed a definitive decision on the matter until the State Secretary of Social Affairs, Mark Rutte, has examined the expected consequences of the EU’s expansion on the Dutch labour market. It might be noted that a recent report from the European Foundation for the Improvement of Living and Working Conditions places both the extent of expected migration flows and the impact this will have on the surrounding countries into perspective (East-west migration before enlargement: potential, structures, explanations, Hubert Krieger, European Foundation, November 2003).

The VNO-NCW employers’ association asserts that not imposing limitations on employees from new EU Member States will increase the competitive strength of both the Dutch and European economy. It believes that new labour migration will contribute towards solving difficulties related to filling certain vacancies in the Dutch labour market that could become structural in the face of the ageing workforce. VNO-NCW believes that attempting to 'screen off' the Netherlands would serve only to increase the number of illegal employees.

The FNV trade union federation is opposed to unrestricted labour migration, calling instead for adoption of a sustainable labour market policy. FNV argues that sustainable investments must be made in current labour market resources, including people of foreign nationality or extraction.

In June 2003, the Central Planning Office (Centraal Planbureau, CPB) carried out a study to ascertain if the Dutch economy would benefit from promoting labour migration, within the context of the ageing population (Immigration and the Dutch economy, CPB, 2003). It found that widespread labour migration is not expected to result in any significantly favourable developments. If the socio-economic characteristics of immigrants roughly correspond with those of the non-western immigrants currently residing in the Netherlands, this may even have a negative impact on public finances. Only if labour migration remains limited in scope - relating to highly qualified individuals filling vacancies that would otherwise have been difficult to fill - will this contribute positively to the Dutch economy.

Commentary

The issue of whether to pursue policies directed at people from minority groups depends in part on whether unemployment among them is purely a consequence of economic vicissitudes or whether it is in fact influenced by policy measures. The Social and Cultural Planning Office affirms the latter. Recent research conducted by the Erasmus University indicates that employers still believe that people from a minority group perform less well at work than their 'native' Dutch counterparts (Een gekleurd beeld - over beelden, selecties van jonge allochtone werknemers[A biased view - on views, selections from young foreign national employees], Erasmus University, ISEO, 2002). However, employers with many employees of foreign nationality or extraction view their performance more favourably than employers without any experience of working with such employees. Information such as this serves to illustrate that employers may require some degree of encouragement in getting to know (the qualities of) employees of foreign nationality or extraction. To this end, targeted policy is needed and the registration of facts alone is not enough. However, it is difficult to understand why such policy should not be based on a sound knowledge of the facts.

With respect to immigration from the new EU Member States, it appears that here too policy should stem from a thorough understanding of the situation. What level and forms of immigration are to be expected and what consequences will this have? And would it in fact be helpful to keep the borders shut for a while? Legal migration is certainly more desirable than illegal migration. Problems such as immigrants working for less pay than usual could then be addressed within the context of Dutch labour law. (Marian Schaapman, HSI)

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