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kirchher

January 14th, 2012

Tackling Euroscepticism: EU employment law is neither imposed on the UK from Brussels nor does it damage the country’s economy

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Estimated reading time: 5 minutes

kirchher

January 14th, 2012

Tackling Euroscepticism: EU employment law is neither imposed on the UK from Brussels nor does it damage the country’s economy

0 comments

Estimated reading time: 5 minutes

Many myths surround EU employment law. Anne Davies tackles these head on and argues that workers and businesses are very much protected rather than inhibited by such labour market legislation.

The United Kingdom’s relationship with the European Union (EU) is always fraught with political difficulty and since employment law tends to attract extra scrutiny during times of recession now is a good time to have an informed debate about the advantages and disadvantages of EU employment law. This could be a chance to tackle some of the myths surrounding the subject.

Quite a lot of our employment law has its origins in EU law: for example, equality law, rules on working time, and requirements for firms to consult their workforce (for example, when there’s a plan to make lots of people redundant). But some areas of law have been put in place by the UK Parliament and government without any EU involvement: these include the national minimum wage, unfair dismissal, and laws on trade union membership and industrial action.

Myth 1: EU employment law is imposed on us from Brussels, and we don’t get any say in it.

In fact, the EU only gets the power to legislate on employment law from its governing Treaties. The United Kingdom (UK) has signed up to the Treaties. When the EU exercises this legislative power, the European Commission makes a proposal, which has to be accepted by the European Parliament (which represents the citizens through its parliamentarians) and the Council. The Council is made up of representatives of the governments of every member state, so again, the UK gets a say, though where decisions are taken by majority voting, the UK might sometimes be outvoted. It is true that we might have to put up with some legislation that we did not vote for (or that was accepted by a previous government but would not be accepted by later governments) but this is all part of being a member of an organisation.

Myth 2: EU employment law damages the competitiveness of the UK economy.

This view is very much bound up with the idea that employment law is a burden on business and that the deregulation of labour markets is the best way to encourage economic growth. It’s difficult to prove or disprove this argument without extensive empirical evidence (try here and here), but it’s worth just considering a few of the counter-arguments.

First, although employment laws do impose costs on businesses, they often bring benefits too. For example, limits on the number of hours people can work might seem bureaucratic to implement, but they may also help to make work places safer and workers happier and more productive. Just looking at costs only tells half the story.

Second, it’s not clear that cutting labour costs is the best route to a competitive economy. Lots of countries worldwide can claim to be cheaper than the UK, so it may be better to think about the ‘added value’ we might offer: highly educated and adaptable workers who are worth the extra money, for example.

Third, it’s not clear that – if EU employment law disappeared tomorrow – we’d repeal all of it. Anti-discrimination law is a good example of something I hope we’d want to keep.

And fourth, if EU law didn’t set minimum standards for employment law in the member states, it’s worth thinking carefully about what would happen within the EU. It’s often assumed that the UK would be able to deregulate its labour market and thus gain a competitive advantage against its neighbours, but now that the EU consists of 27 member states, some with very low wage levels, it is not at all clear that the UK would win any ‘race to the bottom’ in labour standards. Perhaps, rather than being constrained by the EU, we are in fact protected by it.

Of course, this does not mean to say that EU employment law is perfect. There are lots of deficiencies that could be rectified if there was the political will to do so (regarding youth employment for example). This requires us to move beyond discussions of EU employment law as a whole, and to engage in a detailed analysis of the advantages and disadvantages of particular measures. Let’s hope today’s discussion will be a useful contribution to both aspects of the debate.

Anne Davies will be a speaker at Single Market – Equal Rights? – UK perspectives on EU employment and social law’, a high profile conference taking place today (2-6pm) in London and hosted by the Foreign Policy Centre, the European Commission Representation in the UK and Trade Union Congress.

This post was first published on LSE’s blog on British Politics and Policy.

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About the author

Anne DaviesUniversity of Oxford
Anne Davies is Professor of Law and Public Policy at Brasenose College at the University of Oxford. Her main research interests lie in government contracts, public/private partnership contracts and public law analysis of government procurement. Her most recent books are Perspectives on Labour Law (Cambridge University Press, 2009) and The Public Law of Government Contracts (Oxford University Press, 2008).

About the author

kirchher

Posted In: North Europe | The Euro, European economics, finance, business and regulation | Welfare states and public services

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