Equal rights for posted workers

Since 16 December 1999 all workers temporarily working in a European Union (EU) state have had the right to the same minimum terms and conditions as those permanently working in that state. Backup explains the background to these new rights, what they will cover and how they will operate, both in the UK and in the rest of the EU.

The new rights apply to what are called "posted workers". These are workers who are transferred on a temporary basis from one EU state to another, or from outside the EU to work in an EU state. The Department for Trade and Industry defines a posted worker as "one who for a limited period, carries out his (or her) work in the territory of a European Community member state other than the state in which he normally works". For example, if a worker in one of the big banks in the UK is asked to transfer for, say six months, to the French office, s/he will have the right to the same minimum terms and conditions as apply to workers permanently working in France. And this will happen even if the terms are better than those in the employee's own contract of employment. In effect an individual's contract is temporarily changed to include the new minimum terms.

The Posting of Workers Directive 1996 was enacted to ensure that posted workers do not undermine the terms and conditions of workers in the state to which they are transferred. The directive is expected to particularly benefit workers in the construction sector, where labour mobility is high. Workers from the UK, for example, were being sent to work in Germany, but under conditions vastly inferior to those offered to German workers.

The states most firmly behind the directive tended to be those where terms and conditions were generally regarded as good. Their fear was of "social dumping" - in other words that if workers were brought in on lower terms there was a risk that employers may regard them as a more attractive option in the long term. In general lower waged economies, together with the UK (which opposed the setting of any minimum standards for ideological reasons), opposed the directive. These differences meant that it was not until 1996 that the directive was agreed, and even then only by a majority vote.

Once adopted, all EU states had three years to ensure that their own internal legislation complied. The UK government has announced that most UK legislation was in compliance and that where change was needed, it has occurred. This includes extending protection against discrimination on the grounds of sex, race and disability to those employed mainly outside the UK. The law has also been changed to ensure that workers posted to Britain have the right to all employment protection legislation as if they were British workers.

There are three situations where workers are considered as "posted" to an EU state. These are:

* where there is a contract between their employer in their own state and a party in another state and they are to supply services under that contract;

* where the posting is to a subsidiary or associate located in another EU state; or

* where the employee works for an agency which hires out labour but maintains an employment relationship with the worker during the period of the posting.

The rights apply to "workers", not just to "employees" with contracts of employment. This means that they cover a wider group of individuals than are protected by much UK legislation. An agency worker, who works under a contract for services and who is transferred to another EU state is likely to be able to benefit from rights, for example to maternity leave and pay, which would not be available in the UK, due to her contractual status.

The terms and conditions which apply are those either set down in legislation as minimum standards or in mandatory collective agreements. The latter in general is not relevant to the UK, since collective agreements are not legally enforceable. But in most other EU states they are and can set minimum standards. This means that workers who transfer to other EU states need to check what provision there is in the collective agreement, in addition to anything in legislation.

The terms and conditions which are covered include: minimum terms covering hours, holidays and breaks; health, safety and hygiene; protective measures for pregnant workers, children and young workers; equal treatment; and agency employment.

In the UK minimum pay is also covered. However, the directive would have permitted its exclusion where workers are transferred for less than a month. There is nothing in the legislation which prohibits offering better terms and conditions to posted workers. Thus payment of additional allowances for working in another country or other more generous terms are not barred.