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Aug 8, 2017 | 19:16 GMT

3 mins read

Europe: France's President Heads East in His Bid to Protect French Workers

(Stratfor)

Another battle between Western and Eastern members of the European Union looms on the horizon. This time, the debate will focus on the status of "posted workers," or laborers sent by their employers to work in another EU member state temporarily. While dispatched abroad, the social security rules of the posted worker's country of origin still apply. Consequently, companies are able to pay posted workers from Eastern and Central Europe less than their Western European peers. Though posted workers represent less than 1 percent of the Continent's workforce, the issue is controversial: High-salary countries such as France, Austria and the Netherlands argue that the system gives workers from low-salary countries such as Poland or Romania an unfair advantage.

French president Emmanuel Macron will discuss this issue with Austrian, Czech, Slovak, Romanian and Bulgarian leaders during a tour of Eastern Europe on Aug. 23-25. Macron wants to reduce the time allotted to posted workers from 24 months to 12 months. He also wants to ensure that posted workers receive the same remuneration as workers doing the same job in the host country. But the Polish government has denounced Macron's plans as veiled protectionism and has accused the French president of trying to weaken the EU principle of free movement of services.

The European Union created the posted-workers system in 1996, and reforms have been slow to materialize. In 2016, the EU Commission presented a series of proposals for reform, but 11 countries, mostly from Central and Eastern Europe, froze the proposals and asked Brussels to review them. The EU Commission wants to restart the debate later this year, but member states and the EU Parliament must approve any changes to the posted workers system. In principle, countries opposing a redesign of the system do not have enough votes in the European Union to veto it. Macron's tour to the region is an attempt to find a compromise solution.

Macron's push to reform the posted workers system happens at a time when some Eastern EU member states are already pushing against Brussels. Several Central and Eastern European countries are refusing to adopt an EU plan to distribute asylum seekers across the bloc and Poland and Hungary are actively working against EU interference. Labor and migration are contentious issues in the European Union, but they are priorities for Macron, who has pledged to defend France's industries and workers.

In addition to this latest posted workers drive, the French government also wants the European Union to make it harder for non-EU investors to acquire companies in strategic sectors and for 19 members of the eurozone to harmonize their corporation taxes and to close the loopholes that work in favor of foreign companies (especially in the high-tech sector), even though some northern European countries have warned that these proposals could add another layer of protectionism in the European Union and discourage foreign investment.

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