NEW EMPLOYMENT MODELS
AND SOCIAL DUMPING
IN AIR TRANSPORT
Globalisation does
not intimidate
European airlines,
nor internal
competition but the
rules must be
similar to avoid a
collapse of the
European airlines
Emmanuel Jahan – chair of the European sectoral committee of social dialogue for civil aviation – April 2015 – emjahan@orange.fr
p 01/15
AN ANARCHIC COMPETITION COULD MOVE
TO AN UNFAIR COMPETITION AT GLOBAL AND EUROPEAN LEVELS
1920
2020 ?
> Unfair competition involves social dumping
> Proofs of unfair competition exist
> Is there a lack of political will to address
circumvention of law and end impunity ?
p 02/15
FAIR COMPETITION ?
Exemple 1
European survey February 2014 :
6633 respondents (out of 65000 pilots concerned) in
which 15% French / 15% Dutch / 11% British
> regular change of bases (3 months?)
Figures for this
example 1
> Air crew declared in Ireland for
social security contributions but
working from other Member States
> Intense use of self-employed
p 03/15
FAIR COMPETITION ?
A micro-enterprise for each pilot
with the status of self-employed
BOGUS SELF-EMPLOYED ?
IMPACTS ON SAFETY ?
Where are self-employed ?
p 04/15
FAIR COMPETITION ?
FLAG OF
CONVENIENCE ?
Example 2
Figures for this
example 2
> Air crew officially based
in Bangkok but working from
Gatwick
> Intense use of temporary
agencies based outside Europe
p 05/15
> Employment contracts in Singapore
 A Singapore temporary agency with
air crew officially based in Bangkok
but with duties that start and end
from a European workplace
FAIR COMPETITION ?
WHERE AIRLINES PAY SOCIAL CONTRIBUTIONS ?
p 06/15
Example 3
> State aids
> Same owner of the
airline and of the airport
FAIR
COMPETITION ?
p 07/15
1998
2010
Employment has not increased from 1998 to 2010
according to a study of the DG Move (European
Commission) despite Low Cost air Carriers (LCC)and
a growth more than 5% a year of the market.
p 08/15
What about employment
in Europe ?
p 09/15
Unemployment, unfair competition,
agressive competition
Which future
for the European airlines ?
p 10/15
Characterize the notion
of “worker”
a job
> « performance of work, subordination and the
remuneration of the worker » (directive 2014/67/EC)
A worker
+
a boss
+
money
> “person who
:
- undertakes genuine and effective work
- under the direction of someone else
- for which he is paid.”
(European Commission, 11.12.2002 COM(2002) 694 final)
> “The essential feature of an employment relationship
is that a person performs services of some economic
value for and under the direction of another person in
return for which he receives remuneration”
Judgment of the Court of 3 July 1986. - Deborah
Lawrie-Blum v Land Baden-Württemberg. - Case 66/85.
p 11/15
Enforce the social
security and labour laws:
through the concept
«in which – from which»
> The competent jurisdiction :
Convention of Brussels (1968)and its regulation 44/2001/EC (replaced by
Regulation (EC) 1215/2012 from 10th January 2015). case 37/00 of 27/02/2002 Weber
> Applicable labour law :
Convention of Rome I (1980)and its regulation 593/2008/EC. Principle of « home
base » included in the regulation 593/2008/EC (« in which - from which ») (C-29/10
Heiko Koelzsch of 15 March 2011)
An individual employment contract shall be governed by the law chosen by the
parties but such a choice of law may not deprive the employee of the protection
that cannot be derogated from by agreement under the law that, in the absence of
choice, would have been applicable (art 8 – 593/2008/EC)
> Applicable social security law : regulation 465/2012/EC (principe of the « home
base »)
> 3 laws in line with the « home base » : air transport (EU OPS and regulation FTL
83/2014/EC) – labour law (593/2008/EC) – social security (465/2012/EC)
p 12/15
Which workplace ?
>
« Letter box companies »
:
« Companies which have been set up with the purpose of benefitting from legislative loopholes while
not themselves providing any service to clients, but rather provide a front for services provided by
their owners. Such companies are normally very small and often only operate a letter box, hence the
name. » European Commission COM (2013) 122 Final
>
« home base »:
This « means the location, assigned by the operator to the crew member, from where the crew member
normally starts and ends a duty period or a series of duty periods and where, under normal
circumstances, the operator is not responsible for the accommodation of the crew member concerned; »
(ORO.FTL.105 Definitions). The word « nominated » in the previous regulation has been changed to
enforce the will to assign. (regulation 83/2014/EC)
>
« establishment »
« having an infrastructure there enabling it to pursue a professional activity there on a stable and
continuous basis and, from the infrastructure, to hold itself out to, amongst others, nationals of the
second Member State » (European Court – case Bruno Schnitzer C215-01)
>
« principal place of business »
European definition only for civil aviation (1008/2008/EC):the head office or registered office of a
Community air carrier in the Member State within which the principal financial functions and
operational control, including continued airworthiness management, of the Community air carrier are
exercised.
US definition:the « nerve center » of the company (judgment of the Supreme Court February 2010)
p 13/15
Global competition needs global
fiscal and social agreements
Air transport must take into account the
maritime experience to avoid the collapse of
the US and European fleets (flags of
convenience) but also must take into account
the measures put forward to control what
are genuine abuses:
- Global agreements (maritime convention
2006 with the International Labour
Organization, safety, etc.),
- fiscal measures to support European
shipowners (fiscal and social security
taxes),
- new regulations
p 14/15
Conclusions
European airlines must be offensive to improve their
competitiveness and not merely defensive but in this
competition, a level playing field has a key role
This is why some European regulations must be adapted :
-
868/2004/EC against subsidisation and unfair pricing practices from third countries
-
1008/2008/EC to better define the principal place of business and the use of the Air
Operator Certificat (AOC)
-
83/2014/EC to improve the definition of the “home base”
-
465/2012/EC to improve fight against circumvention of law by using bogus home bases
Bogus self-employment, flags of convenience and other undeclared work must be sentenced
European air transport needs global fiscal and social agreements but
also European fiscal and social measures to avoid
unfair global competition
Revive European air
transport for future !
p 15/15