Posted Workers Enforcement Directive: Impact on construction industry
03 February 2016
The Government’s response to the consultation on implementing the Posted Workers Enforcement Directive confirms that new regulations will be introduced so that a posted worker in the construction sector can bring an individual claim for unpaid wages for the national minimum wage against a contractor in an employment tribunal.
In July 2015 the Department for Business, Innovation & Skills published a consultation ‘Implementing the Posted Workers Enforcement Directive’.
Posted workers are individuals who are employed in one European Member State but sent by their employer to work temporarily in another Member State before returning home.
The 1996 Posted Workers Directive (96/71/EC) provides a framework so that both businesses and workers can take full advantage of the opportunities offered by the single market. The Directive supports the freedom to provide services across the EU and provides both fair competition for businesses and respect for the rights of the workers.
It entitles posted workers to statutory employment rights in the country they are posted to. These are:
- maximum work periods and minimum rest periods;
- minimum paid annual holidays;
- minimum rates of pay, including overtime rates;
- the conditions for hiring out workers, in particular the supply of workers by temporary employment firms;
- health, safety and hygiene at work;
- protective measures with regard to the terms and conditions of employment of pregnant women or women who have recently given birth;
- children and young people; and
- equality of treatment between men and women and other non-discrimination provisions.
The 2014 Enforcement Directive (2014/67/EU) builds on mutual co-operation information and enforcement requirements in the 1996 Directive and must be transposed by 18 June 2016. It also introduces a requirement for subcontracting liability in the construction sector.
The Government’s response to the consultation states that the UK will meet its obligations under the Enforcement Directive by taking a light touch approach that does not go beyond the EU requirements and balances the rights of both workers and the burdens on the businesses that employ them.
Regulations will be introduced to bring in some new measures to implement the requirements of the Posted Workers Enforcement Directive. These measures will introduce limited subcontracting liability in the construction sector. This means that a posted worker in the sector can bring an individual claim for unpaid wages for the national minimum wage against a contractor in an employment tribunal. A due diligence defence will be available to the contractor.
Subcontracting liability will be limited to the construction sector and to the contractor one up the supply chain from the posted worker’s direct employer.
Guidance will be issued in due course to ensure that employers and employees in the UK are aware of the minimum rights for workers and how they can be enforced. Going forward, the Government will enforce the Enforcement Directive, making sure that UK competent authorities cooperate and collaborate on cross-border issues.