by S.G. Kazolias: President Emmanuel Macron campaigned to put an end to what he called “Social Dumping” —- the practice of temporarily hiring workers from poorer EU countries at the minimum wage and paying their much lower social security in their home country. On March 1, EU delegates in Brussels agreed to revise the 1996 accord allowing this. But getting all EU countries to agree may be harder.
When the then 12 EU members approved the 1996 ‘Posted Workers’ directive, labor costs between the different countries was one to three. As the EU enlarged to 28 with the former Soviet Block countries, that differential became one to ten and employers took advantage of it. Skilled labor was brought in from countries like Bulgaria, Romania and Poland at a fraction of the cost. Continue reading →