Self-employed workers: Self-employed workers: industrial relations and working conditionsindustrial relations and working conditions

EESC – Brussels, 24 September 2009

‘Trends in self-employed work’

Christian Welz Christian Welz

European Foundation, DublinEuropean Foundation, Dublin

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OutlineOutline

I. Methodology

II. Research objectives

III. Definition (s)

IV. Incidence

V. Social security

VI. Interest representation

VII. Employment & working conditions

VIII. Conclusions

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I. MethodloyI. Methodloy

comparative analytical report

of EIRO and EWCO

27 national reports & NO structured questionnaire

1 overview report

online under:

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II. Research objectivesII. Research objectives

recent trends in self-employment the institutional framework collective representation of self-

employed workers employment and working conditions of

self-employed workers

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III. Definition(s)III. Definition(s)

clear-cut and common definition of ‘self-employed worker’ across all MS is a challenging task

difficulties derive from the specific features of

national contexts and legal frameworks

main problems are linked to the significant

changes in employment relationships in recent

years

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III. Definition(s)III. Definition(s)

common definition across countries of this study refers to the traditional classification of employment

relationships based on legal subordination and the

dependent/independent worker dichotomy

corresponds to the classifications used by the OECD

and the ILO

self-employment is defined in a residual way comprising all contractual relationships not falling

within the boundaries of ‘paid employment

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III. Definition(s)III. Definition(s)

ILO

includes under the heading of ‘self-

employment jobs’ both ‘employers’ and

‘own-account workers’ (Resolution

concerning the International

Classification of Status in Employment

1993)

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III. Definition(s)III. Definition(s)

Labour force survey

persons who work in their own business,

professional practice or farm for the

purpose of earning a profit, and who

employ no other persons;

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IIÌ. National definitions IIÌ. National definitions

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country legal definition main domains in which self-employment has been defined

AT yes Income tax act; Labour law; General social insurance act

BE yes Social security law; Fiscal law BG yes Employment promotion act; Nat. statistical

system CY yes Social insurance law CZ yes Social security insurance law; National statistical

system DE yes Act to promote self-employment; Federal

Labour Court DK yes Employment act; National statistical system EE yes Tax act EL yes Social security law; Case law ES yes Social security law; Self-employed Workers’

Statute FI yes Civil law; Self-employed persons pensions act FR yes social security regime for self-employed

workers; National statistical system HU no - IE no Code of practice on employment status by a

tripartite Employment Status Group

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country legal definition main domains in which self-employment has been defined

IT yes Civil code; Tax law; Social security system; National statistical system

LT yes Law of state social insurance; Law on personal income tax; National statistical system

LU yes Social insurance code LV yes Civil law; National statistical system; Labour laMT yes Social security act NL yes Tax law NO no - PL yes Act of freedom of business activity; Act on PT yes Civil law; Business law; Income tax code; Social

security law RO yes National statistical system; Labour code SE yes Tax law SI yes Civil law; Law on commercial companies; Law

on pension and disability insurance; several sectoral laws concerning ‘liberal’ professions

SK yes Social insurance act; Trade licensing act; Commercial code

UK no Nature of employment assessed on a case-by-case basis if disputes arise

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III. 5 categories of self-employmentIII. 5 categories of self-employment

1. entrepreneurs running their business with employees;2. ‘free professionals’ who meet specific requirements,

abide by regulations/codes and often pass examinations. - they can hire workers, but generally carry out

their activities alone;3. caftworkers, traders and farmers, who represent the

traditional forms of self-employment. Often work with their family members and possibly a small number of employees;

4. self-employed workers in skilled but unregulated occupations (‘new professionals’);

5. self-employed workers in unskilled occupations, who run their business without the help of employees/sometimes be assisted by family members.

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IV. Incidence IV. Incidence

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IV. Incidence IV. Incidence (v(variation on total employment by gender in%)ariation on total employment by gender in%)

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V. Social securityV. Social security

liberal systems self-employed usually excluded from mandatory

public schemes UK

cannot benefit from allowances which are not means tested

nor from protection against unfair dismissal, redundancy compensation and guaranteed pay

can benefit from lower income tax rates and claim back certain expenses against tax

Ireland not entitled to unemployment, disability and

invalidity benefits

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V. Social securityV. Social security

conservative regimes

various compulsory regimes

different programmes devoted to single

occupational groups (esp. traditional

ones)

huge variation within this cluster

numerous recent reforms

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V. Social securityV. Social security

social democratic regimes

large differences

in SF self-employed workers have the

possibility to choose both the composition

and level of their social security

in SE social security does not take seasonal

income fluctuations into account (e.g. for

sickness benefits/parental allowances)

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V. Social securityV. Social security

former socialist regimes

large variety

relevant differences between benefits for

employees and self-employed workers

main distinctions refer to the nature of

insurance schemes (mandatory/voluntary)

& the amount of contributions

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VI. Interest representationVI. Interest representation

Trade Unions organise self-employed workers in some professions

characterised by high skills and significant autonomy in their work (journalists/ performing artists)

construction sector with a high incidence and TU representation

road haulage situation is more mixed, but TU seem to prevail recurrent debates on whether TU should more

clearly try to organise self-employed truck drivers in the other traditional sectors (agriculture/crafts)

business organisations clearly prevail

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VI. Interest representationVI. Interest representation

Trade Unions tried to extend their representation to new groups of

workers which are formally self-employed but have a less

clear-cut professional identity

particularly the case where new types of employment

contracts have been introduced or even with the aim of normalising formerly

unregulated positions

in few countries, self-employed workers seem to be

substantially outside the scope of TUs

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VI. Interest representationVI. Interest representation

Employers organisations self-employed workers are regarded as entrepreneurs

and (potential) employers collective representation is within business

associations / or general interest representation and without specific employer representation

functions typical of the associations of liberal professionals proper employer associations are present in certain

sectors where self-employment is more widespread (agriculture, crafts and retail trade)

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VI. Interest representationVI. Interest representation Employers organisations

almost exclusive attention to the entrepreneurial aspects of self-employed workers

issues of personal work are almost always neglected limited reference to competence building and training by

business organisations were included in the national reports (especially in NMS)

issues of health and safety even less present practically no business representation exists as such for self-

employed workers as own-account workers without employees have to refer to professional associations, small and medium-

sized enterprises (SMEs) or general employer associations and Chambers of Commerce

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VII. Employment & working conditionsVII. Employment & working conditions

1. Working time:

- long working hours (+48 h/week)

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VII. VII. by gender and employment status (%)by gender and employment status (%)

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VII. VII. by sector of activity (%)by sector of activity (%)

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VII. VII. by occupation (%)by occupation (%)

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VII. Employment & working conditionsVII. Employment & working conditions

2. Health and safety

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VII. VII. Impact on health by sector and Impact on health by sector and employment status (%)employment status (%)

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VII. VII. Health-related leave by gender and Health-related leave by gender and employment status (%)employment status (%)

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VII. Employment & working conditionsVII. Employment & working conditions

3. Earning levels

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VII. VII. Distribution of income by employment Distribution of income by employment type (%)type (%)

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VII. VII. Income levels by sector of activity (%)Income levels by sector of activity (%)

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VII. VII. Income levels by size of establishment Income levels by size of establishment (%)(%)

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VIII. ConclusionsVIII. Conclusions very diverse nature of self-employment from a legal point of view

self -employment is commonly defined in a residual way from an economic/social perspective the situation is influenced by a

number of dimensions professional skills the organisation and running of an independent business in a

market environment the autonomy and independence in organising their own work capacity to bargain individually their compensation with

customers these features add to the differences in employment and working

conditions among self-employed workers and their potential

demands for collective representation

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VIII. ConclusionsVIII. Conclusions

domains of most relevant innovations in the regulatory framework in recent years social security regulation collective representation

social security coverage has been extended to certain areas of self-employment in some countries through initiatives that aim to provide basic

protections yet, usually well below those granted to

employees

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VIII. ConclusionsVIII. Conclusions

TU representation (often as service provision and sometimes as CB) offered in improving the economic and employment prospects of self-employed workers

especially in professional freelance positions CB mechanisms encounter important limitations

due to competition laws

restricting the negotiation of standard fees and

contracts for formally independent workers

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VIII. ConclusionsVIII. Conclusions

scope for further research remarkable lack of data

polarisation of earnings significant share of self-employed workers showing low

incomes diffusion of long and non-standard working hours high incidence of industrial accidents and work-

related health problems increasing attention paid by trade unions

indicates a ‘subjective’ demand for protection business-friendly measures have aimed to facilitate

the running of micro-enterprises through fiscal or economic incentives

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http://www.eurofound.europa.eu/comparative/tn0801018s/index.htm

christian.welz@eurofound.europa.eu

Further informationFurther information