Mixed UK reaction to developments concerning amendment of EU working time legislation

Decisions during May and June 2005 by the European Parliament and the social affairs Council concerning the proposed amendment of the EU working time Directive met with contrasting responses from UK employers, trade unions and the government.

On 11 May 2005 (EU0505205F), the plenary session of the European Parliament (EP) approved a 'first reading' legislative resolution seeking substantial amendments to the European Commission’s draft Directive (EU0410205F) on revision of the EU Directive concerning certain aspects of the organisation of working time (originally adopted in 1993 and now consolidated in Directive 2003/88/EC). On the most controversial issue - the future of the scope for individual employees to opt out of the 48-hour limit on average weekly working hours - the EP voted to impose a limit on the validity of such opt-outs to a (renewable) period of six months and to repeal the opt-out provisions altogether 36 months after the revised Directive comes into force.

The EP’s position was considered by the Employment, Social Policy, Health and Consumer Affairs Council on 2-3 June, which decided to put off a decision on the proposed amendments pending further discussions (EU0506204F).

In the run-up to the crucial vote by the EP, UK employer and trade union bodies lobbied hard for their preferred outcomes - with the Trades Union Congress (TUC) supporting the draft report which was put before MEPs, while the Confederation of British Industry (CBI) urged MEPs to reject it. This feature outlines the sharply differing responses of employers, trade unions and the government to the outcome of both the EP vote and the Council’s subsequent discussion of the matter.

The EP vote

Ahead of the crucial EP vote, the TUC called on the government and UK employers to accept the 'sensible modern compromise' put forward by the EP’s Employment and Social Affairs Committee. Among other things, this involved ending the individual opt-out after three years, while providing that weekly working hours can be averaged out over a year. While not happy with every aspect of the Committee’s position, the TUC recognised that support from a significant proportion of MEPs from the conservative/Christian Democrat EPP grouping, as well as among PES, Green and other left of centre MEPs, would be necessary if the call for an end to the individual opt-out was to be carried.

The CBI, however, argued that abolishing the opt-out would 'seriously restrict the UK's flexible labour market and flies in the face of the EU's ambition to become the most competitive economy in the world by 2010'. The employers’ organisation said that maintaining the opt-out would be a 'crucial first test of the new UK government's resolve in Europe, and British business is relying on it to maintain a robust defence'.

Similarly, the Engineering Employers’ Federation (EEF) urged all UK MEPs to vote against 'damaging amendments to the Commission’s proposal that would remove the individual opt-out and undermine the UK’s labour market flexibility', adding that 'the government must continue to stand firm and eyeball-to-eyeball with Brussels on this important issue'. The EEF expressed 'particular concern' that Labour MEPs appeared determined to support the abolition of the opt-out, putting them 'at serious odds' with the position of the UK Labour government which was to retain it.

Following the EP’s vote, TUC general secretary Brendan Barber said: 'This is a victory for a common sense compromise on the 48-hour working week.' However, the CBI issued a statement condemning the EP’s resolution and calling on the UK’s newly re-elected Labour government to oppose the EP’s amendments in the Council of Ministers.

The UK Prime Minister, Tony Blair, reportedly said he had 'no intention whatsoever' of abolishing the individual opt-out. Mr Blair said he believed that the UK had sufficient support among other EU governments to prevent such an outcome.

The social affairs Council meeting

On 31 May, the Commission brought forward an amended proposal for a Directive to revise the existing working time Directive which took account of some but not all of the EP’s suggestions. While it was unable to accept the EP’s amendment on the individual opt-out as it stood, the Commission indicated that it was prepared to explore a possible compromise on this question between the Parliament and the Council.

The issue featured on the agenda of the Employment, Social Policy, Health and Consumer Affairs Council meeting on 2-3 June 2005, but in view of the extremely tight timetable, and the existence of support on the part of a range of Member States for retaining the current scope for individuals to opt out of the 48-hour limit, it was unlikely that the meeting would result in the adoption of a common position, even though this is possible by qualified majority vote.

In the event, ministers decided to put off a decision on the issue pending further discussions. This outcome was widely seen as indicating that enough Member States were opposed to abolishing the opt-out to constitute a potential blocking minority. The BBC reported that the UK’s stance of maintaining the opt-out was backed at the meeting by Germany, Poland, Austria, Hungary, Malta, Cyprus and others. The countries wishing to end the opt-out reportedly included France, Belgium, Sweden, Spain, Greece, Finland and Lithuania. Ministers agreed to ask COREPER to seek to make progress on the proposed Directive.

Responding to this outcome on behalf of the TUC, Brendan Barber said in a statement: 'It is no surprise that the EU is in crisis when a small UK-led minority can block this compromise on working time. The Commission proposals already went a very long way to meeting employer concerns - far more than the much more balanced position put forward by the Parliament. This does not settle the issue. Other Member States who wanted a compromise that met their concerns about on-call working, particularly in the health sector, will not be satisfied with this delay. UK ministers have made the mistake of going to the last ditch on behalf of the CBI. Britain’s long hours workers will be the main losers from this political brinkmanship.' Dave Prentis, general secretary of Unison, said: 'We think it’s appalling that our government should be persisting with the opt-out.'

However, employers’ groups welcomed the outcome of the meeting. David Frost, director-general of the British Chambers of Commerce, said it was 'good news for business and for Europe’s future prosperity .. We congratulate the government on standing firm and gathering support for flexibility in the Council.'

Commentary

The future of the individual opt-out from the statutory limit on average weekly working time is a key area of contention between the newly re-elected Labour government and the trade unions, between EU Member States and between the European Parliament and Council.

UK unions are highly critical of the government’s stance on the issue. Although the pre-election 'Warwick agreement' between Labour Party and union leaders (UK0409102N) included a commitment to amend the UK’s working time Regulations by making employees’ statutory entitlement to four weeks’ paid holiday additional to bank holidays, the government has consistently sided with employers’ groups in insisting on the retention of the individual opt-out as a vital component of UK labour market flexibility.

At EU level, it is clear that there is a long way to go before any legislation to revise the existing working time Directive can be finalised. Under the co-decision procedure, if and when the Council adopts a common position on the proposal, the latter will return to the EP for a second reading. If the EP makes further amendments to the proposal at this second reading, it will be returned once more to the Council. If, at that stage, the Council cannot accept the EP’s amendments, the text will be forwarded to a conciliation committee, which will aim to find a solution acceptable to both the Council and the EP. Moreover, the UK government takes over the EU Presidency for six months from 1 July 2005, and unless it judges that it is possible to secure a common position which meets its objectives - an apparently unlikely prospect given the line-up of pro- and anti-opt-out countries - it is expected to keep the issue off the Council’s agenda until 2006. (Mark Hall, IRRU)

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