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The regulation of employment conditions of labour migrants in the temporary work agencies sector: The cases of the Netherlands and the UK

AIAS-HSI Working Paper Series - Wike M. Been & Paul de Beer

W.M. Been & P. T. de Beer (2018). The regulation of employment conditions in labour migrants in the temporary work agencies sector: the cases of the Netherlands and the UK, AIAS-HSI Working Paper 2.

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Introduction

The ‘freedom of movement for workers’ and ‘the freedom to establish and provide services’ are two of the four principles of the European single market. The freedom of service provision is closely related to the free movement of workers, as it may involve workers who are formally employed in one country, but are outsourced to another country (posting of workers) (Pedersini & Pallini, 2010; Sociaal Economische Raad, 2014). In practice, therefore, both freedoms enable labour migration between European countries. In 2004 and 2007, a total of ten Central and Easter European (CEE) countries accessed the European Union (EU). These CEE countries had generally a lower wage standard than the existing member states. This caused concern among the existing member states, as they expected large numbers of labour migrants to enter their labour markets as a consequence. They were worried that this would disturb their labour markets, because labour migrants would be willing to work for lower wages and under worse conditions than natives, because low wages in the old member states are not low compared to the standard in the accessing countries (Jones, 2014; McDowell et al., 2008; Sporton, 2013). They expressed their concern that this would exert a downward pressure on wages and employment conditions and result in crowding out, especially at the lower end of the labour market (Krings, 2009; Lillie & Greer, 2007; Menz, 2010; Skupnik, 2014). The outcome of the debate that followed on the EU level was that existing member states were allowed a maximum of seven years to fully open their labour markets to workers from the accessing member states, in order to have time to adjust their labour markets and welfare system to the new situation.