ESBA - The Independant Voice for Small Business

THE WTD: ESBA BACKS RETAINING THE OPT-OUT CLAUSE, BUT WARNS AGAINST FURTHER LIMITING ITS USE

Brussels, November 06th 2006

On 7 November, a Council meeting of EU employment and social ministers will convene in Brussels in a bid to break the deadlock on the Working Time Directive. The session will focus on a compromise text prepared by the Finnish Presidency, which seeks to resolve the most controversial issue - namely the so-called opt-out system.

For Small and Medium-Sized Enterprises (SMEs), productivity and competitiveness is dependent on the entrepreneur’s ability to meet demand for their goods and services in the most efficient and cost-effective way. Given that the personnel resources of SMEs are limited, flexibility in the organisation of time and duties undertaken is essential.

As a result, ESBA supports the possibility for the employer and individual employee to agree an opt-out from the 48-hour working week. Indeed, in a context where SMEs represent 99.8% of all EU enterprises and account for two-thirds of employment, ESBA proposes its extension to small businesses in all EU countries in order to achieve the Lisbon goals. The strict conditions on the opt-out’s use suggested by the Finnish proposal could, however, lead to less flexibility, less growth and jobs.

Firstly, the compromise text under discussion would allow employees to work up to 60 hours a week, but only over a three-month period. ESBA considers this time frame too limited and argues that a one-year reference period would more adequately account for the variations in activity and flexible needs of small businesses.

In addition, provisional retention of the opt-out is offset by the requirement proposed by the Finns for all existing opt-outs to be re-negotiated and future opt-outs to be subject to increased bureaucracy. ESBA argues this would increase the already-high burden of red tape on SMEs and is contradictory to the EU’s Better Regulation Agenda.

Moreover, the Finnish Presidency has proposed gradually ending the opt-out and calls on member states to establish timetables in conjunction with social partners. In addition to hindering the EU’s ability to become ‘the most competitive and dynamic knowledge-based economy in the world’ by 2010, ESBA believes that scrapping the opt-out would lead to more black economy, at the expense of entrepeneurs respecting the rules.

Agreement on the Working Time Directive is a central component of the EU’s efforts to achieve the Lisbon Goals. Retention of the opt-out system is however crucial to allow SMEs – the backbone of the European economy - the flexibility to be productive and compete. ESBA urges EU employment and social ministers not to further limit its use.

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Note to the editor:

ESBA is a non-party political European group, which gathers member organisations from 22 European countries. It currently represents over 1.5 million small business entrepreneurs and is one of the largest organisations based on voluntary (vs. statutory) membership in Europe. ESBA cares for small business entrepreneurs and the self-employed and represents them through targeted EU advocacy activities. It also works towards the development of strong independent advocacy and benefits groups in European countries. For more information, please contact: secretariat@esba-europe.org

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Page last updated: 30/01/2007 1:55:55 PM