EBC mostly supports the provisions included in the proposal for a directive providing for sanctions against employers of illegally staying third country nationals - COM (2007) 249 final, whilst nevertheless proposing certain amendments.
Beyond the repressive measures foreseen in the Commission's proposal and in other regulations, EBC suggests that there is a need for preventive measures and information campaigns. EBC is of the opinion that the European Commission and the Member States should also move to fight the causes of illegal employment, which in large parts are due to well-known unresolved issues. In the construction sector, undeclared work mainly results from a shortage of labour, constraining work regulations, and excessive social and fiscal contributions. It is often the client that will ask the builder to undertake work without declaring it to avoid paying VAT. Furthermore undeclared work is also caused by employees legally declared in their construction companies that during week-ends and free time undertake work for and are paid by third parties in an absolutely illegal manner. This is a parallel economy, which is developing and reducing the work available to craftsmen and SMEs of the construction sector, whilst seriously damaging employment in general.
EBC puts forwards the following proposals in order to better fight undeclared work in the European construction sector.
1. Simplification of the regulatory environment and more flexibility in working conditions EBC asks for the application of the "Think Small First" principal and an increased participation of SME representatives in the sectoral social dialogue.
2. Financial incentives for clients: EBC strongly supports the permanent adoption of reduced VAT rates on maintenance and renovation works in housing
3. Social identity card
In several Member States, social identity cards have been put in place. The card is a personal pass, which is sent out periodically to all building workers. Only those building workers for whom the employer has paid the social charges and taxes receive a social identity card. EBC and its members are promoting exchange of best practices in this field.
4. Genuine / Bogus Self-employed people
EBC is strongly attached to self-employed status. Freedom of choice to work alone, for oneself, to be neither employer, nor employee should be respected and maintained in Europe. However, EBC deplores the issue of bogus self-employed people resulting from the activity of intermediary agencies trafficking in cheap labour originating often from Eastern Europe. Controls should be reinforced in order to re-qualify these false sub-contacting relationships into working contracts.
5. Subcontracting
Chain-subcontracting raises issues such as lack of transparency and difficulty to attribute responsibility. Certain Member States have set up regulations or practices improving subcontracting conditions. EBC asks the Commission to launch an initiative aiming to improve the conditions for subcontracting.
6. Information campaigns
EBC is of the opinion that wide spread information campaigns targeting the general public should be launched in order to make everyone aware of the risks and negative consequences of undeclared work.
Undeclared work is not limited to the construction sector; it does exist in many other sectors undermining the viability of European social security systems (unemployment, pensions, heath) by reducing available financial resources, whilst creating an unacceptable and unfair situation as all of the financing of social systems has to be carried by those businesses and persons in full compliance.
