Student: Silvia Di Chiara

“The principle of free movement of workers within the EU:

problems, challenges and opportunities”

Introduction : evolution of the legal framework

Free movement of labour is a fundamental principle of the EU. It means EU citizens are entitled to
look for a job in another EU country. Also, qualifications are universally accepted across Europe and
in theory, there should be no discrimination for firms choosing between native and migrant
workers.
For the full realization of the common market in the EU, in addition to the free movement of goods,
the Treaty of Rome, drafted in 1957 and establishing the European Economic Community, provided
for the free movement of persons, services and capital. This Treaty considered the free movement
of people not regarding human beings, but the person as economic subject, that pursuing an
economic relevant activity. The reason of the Treaty resided in a period where there were
difficulties related to labor, in particular, there were some countries that had a productivity that
was not satisfied by the labor they contained. Especially, there were some member states that did
not have enough manpower in relation to their production capacity (such as Germany) and
countries that instead had an excess of labor in relation to their production capacities (as the case
of especially southern Italy). For this reason, the authors of the Treaty proposed a goal of economic
and that is to foster a regime of full employment, promoting territorial redistribution of labor, a
purely economic vision of workers. But nowadays this vision of the worker as a factor of production
was abandoned quickly thanks to the work of the Court of Justice and political institutions through
the enactment of secondary legislation and the subsequent revision of the treaties (such as the
Regulation 1612/68/EEC and the Directive 2004/38/EC).
The free movement of workers is linked with the concept of EU citizenship. In fact , the Treaty of
Maastricht (1992) introduced the notion of EU citizenship to be enjoyed automatically by every
national of a Member State. It is this EU citizenship that underpins the right of persons to move and
reside freely within the territory of the Member States. The Lisbon Treaty (2007) confirmed this
right, which is also included in the general provisions on the Area of Freedom, Security and Justice.
Inside the Treaty, however, there is no specific definition of concept of European citizenship,
merely define in the art.20 TFEU: “Citizenship of the Union is hereby established. Every person
holding the nationality of a Member State shall be a citizen of the Union. Citizenship of the Union
shall be additional to and not replace national citizenship.” And “Citizens of the Union shall enjoy
the rights and be subject to the duties provided for in the Treaties”. This means that the criteria
governing European citizenship are not prefigured in the Treaty, but always refer to those
established by the Member States in accordance with Union law.

Legal basis

The free movement of workers includes the rights of movement and residence for workers, the
rights of entry and residence for family members, and the right to work in another Member State
and be treated on an equal footing with nationals of that Member State.

The freedom of movement of living and consequently the status of EU citizens find their legal basis
in the art. 18 TFEU on the prohibition of discrimination on grounds of nationality, and in the art.21
TFEU, which establishes the right of all EU citizens to free movement and residence within the EU,
irrespective of his/her age, professional activity or status as a salaried worker. In fact, according to
the art. 21 TFEU, “Every citizen of the Union shall have the right to move and reside freely within the
territory of the Member States, subject to the limitations and conditions laid down in the Treaties
and by the measures adopted to give them effect”. So there is a shift from a “market citizen” to a
“social citizen”.

The Treaty expected a unitary discipline for employment (articles 45-48) . It isn't the same for the
self-employment, because it is a discipline concerned with two different situations: a normative
group, articles 49-55, is about the self- employed established permanently in another member
states, exercising the right to establishment; the second group regards about the self-employed
that works in another member states occasionally, articles 56-62, i.e. the general movement of
services. Then between the two freedoms of movement there is a margin of overlap but not
absorption, because the free movement of services is not only about the individuals but also legal
entities (such as companies). In opposite a this kind of employment there is the situation about the
posted workers, i.e. workers sent to work abroad for temporary periods. Posted workers are
protected only by the Posting of Workers Directive (Directive 96/71/EC), which provides for certain
minimum terms and conditions of employment in the host state, and the associated enforcement
directive (Directive 2014/67/EU), in order to prevent the undercutting of local service providers.

The freedom of movement of workers is laid down in the 45 TFEU. It entails the abolition of any
discrimination based on nationality between workers of the Member States as regards
employment, remuneration and other conditions of work and employment.
According to the art. 45 , paragraph 1: “Freedom of movement for workers shall be secured within
the Union”, so the right of access translates into a ban on obstacles to access to a profession of
employment on the part of member states.

The paragraph 3 of the art. 45 TFEU shows the exceptions to read strictly and a list of rights'
examples to read extensively like justified on grounds of public policy, public security or public
health: to accept offers of employment actually made, to move freely within the territory of
Member States for this purpose; to stay in a Member State for the purpose of employment in
accordance with the provisions governing the employment of nationals of that State laid down by
law, regulation or administrative action; to remain in the territory of a Member State after having
been employed in that State, subject to conditions which shall be embodied in regulations to be
drawn up by the Commission. The content of these limits has been the subject of Directive
221/1964, repealed by Directive 2004/38, which states that: “where there are grounds of public
policy, public security or public health, the Member State may refuse entry to a employee , European
citizen, or expel him from the territory but not for economic reasons”. The Court of Justice added
that the free movement of workers may be limited only if the person's behavior constitutes an
actual and very serious threat about public order.

For example about the offers of employment an interesting case law is “The Queen vs. The
Immigration Appeal Tribunal, ex parte Gustaff Desiderius Antonissen”, involved the Court of Justice
in 1991. The case is about a Belgian moved to UK to find a job; as after more than two years his
research was still unsuccessful, the British government issued an expulsion order against him.
Before the Court of Justice of the British government invoked article 45 stating that this last implies
"the right to accept offers of employment actually made, but also to stay in a member country to
look for work". The Court established that article 45 must be extensively reading , including who
still is just looking for a job. Anyway the court concedes to member states to put a term to find a
job, after which he'll must leave the country.

The second aspect of freedom of movement regards the ban of discrimination, also known as
principles of national treatment , mentioned in article 45 paragraph 2: "Such freedom of movement
shall entail the abolition of any discrimination based on nationality between workers of the Member
States as regards employment, remuneration and other conditions of work and employment". This
principle regards both discriminations: direct, meaning discrimination based on the nationality of
employee ; indirect, meaning discrimination not based on nationality of employee but who also
lead to an inferior treatment. The article 45 provides two categories of limitations: first category
regards the access and the residence of employee on grounds of public policy, public security or
public health ( third paragraph article 45 ),the second category regards the employment in the
public service (fourth paragraph article 45).

Directive 2004/38/EC, of 29 April 2004 on the right of citizens of the Union and their family
members to move and reside freely within the territory of the Member States, amended Regulation
1612/68/EEC, on freedom of movement for workers within the Community, with regard to family
reunification and extended the definition of ‘family member’ (formerly limited to spouse,
descendants aged under 21 or dependent children, and dependent ascendants) to include
registered partners if the host Member State’s legislation considers a registered partnership to be
the equivalent of a marriage. Irrespective of their nationality, these family members have the right
to reside in the same country as the worker. Directive 2004/38/EC introduces EU citizenship as the
basic status for nationals of the Member States, when they exercise their right to move and reside
freely on EU territory. For the first three months, every EU citizen has the right to reside on the
territory of another EU country without any conditions or formalities. For longer periods, the host
Member State may require a citizen to register his or her presence within a reasonable and non-
discriminatory period of time. Migrant workers’ right to reside for more than three months remains
subject to certain conditions, which vary depending on the citizen’s status: for EU citizens who are
not workers or self-employed, the right of residence depends on their having sufficient resources
not to become a burden on the host Member State’s social assistance system, and having sickness
insurance. EU citizens acquire the right of permanent residence in the host Member State after a
period of five years of uninterrupted legal residence.
Court confirmed that free movement of workers provisions have both vertical and horizontal effect
in Angonese case [C-281/98], such as that a private citizen can invoke the right, without more, in an
ordinary court, against other persons, both governmental and non-governmental.

Problems’ economic nature, but not only

The general framework suggests that the problems are mainly economic, not legal.
In fact, in recent years, the EU has expanded to 28 (27 post Brexit). This is now an economic area
with quite significant wage differentials, creating a stronger economic pressure for labour
migration. The bigger wage differential, creates a stronger economic incentive for labour to move
and can lead to more significant labour migration. So, one of the most important problems can be
the large flows of people that cause infrastructure problems. There is concern that a rapid rise in
population places strain on public services (health, education and housing). Consequently, large net
flows exacerbate housing crisis . There is a gap between supply and demand. Even if public services
and housing increased to meet supply, you could argue a rising population leads to a decline in
quality of life, because it increases population density and congestion. Therefore, a rapid rise in
population due to free movement of labour, will contribute to more traffic congestion, which has
both economic and social costs. Moreover if are allowed large net flows of workers from low wage
countries, these workers will be willing to bid down wages and the increase in supply of labour will
lead to a fall in wages of native born workers. This is particularly the case for unskilled workers
which are substitutes for the most part by immigrant labour. Moreover developing countries may
lose their best skilled labour. Workers may be attracted to developed countries with higher wages,
making it difficult for developing countries to retain skilled staff.

There are also non-economic issues, in fact the perceptions of people who feel overwhelmed by
large influx of people with different cultures changing the nature of the area, with a resentment at
rapid immigration. Migrants tend to become absorbed into communities over time. However, it is
the rapid influx of people into an area that people can find unsettling , especially if there are
existing social problems, such as poor housing, high unemployment and crime. Another problem for
the country losing people could be the 'brain drain', if many skilled workers leave and for the host
countries disagreements between different religions and cultures.

Another problem is linked with the project of the Bolkestein Directive (2006/123 / EC), introduced
in 2006, which has the aim to replace the principle of the host state with the principle of the origin
state in terms of labour relations. In fact, the risk is a phenomenon of a social dumping, that occurs
when businesses abuse free movement in the single market to undercut or evade existing labour
standards and regulations, gaining a competitive advantage over bona fide companies. Social
dumping takes place because of gaps and loopholes in EU legislation. Companies are able to
artificially reorganise their corporate structures to take advantage of the freedom to provide cross-
border services. This phenomenon can also occurs as a result of weak enforcement. When workers
are hired in a different Member State from where the work is performed, and when the host
Member State does not, or is not allowed to, have proper inspections, it is difficult to check that
employment standards are met. EU labour law relies on national enforcement, but Member States
do not invest enough in labour inspections. In addition, poor enforcement results from the EU
legislator itself which too often considers national inspections tools as potential barriers to free
movement of services, rather than as a necessary guarantee for fair competition.

Conclusion: a wide range of opportunities

The free movement represents an help for the labour shortages, especially in certain skilled
positions or undesirable jobs many domestic workers don’t want to do. Also it diminishes the rise in
unemployment, in fact, if there is free movement of labour, then workers from oversees can take
temporary jobs when an economy is booming and then return home, when the boom is over. This
is particularly beneficial for cyclical job markets, such as construction. Moreover, the free
movement of labour means rising wages will attract more labour into a country and this will
prevent excess wage inflation. Migration also leads to additional demand and allows to fill
undesirable jobs (such as cleaning, bar work or dangerous job). But also represents opportunities
for workers to work elsewhere. Free movement of labour should help to regional disparities
between the economic union. Free movement of labour has enabled workers in Eastern Europe to
save money and increase their living standards. Some of this income will be saved and sent home to
increase living standards in Eastern Europe. After joining the EU, countries like Portugal, Spain and
Ireland did get closer to average EU GDP per capita levels. In contrast to the disadvantage of the
“brain train”, the migrants may return in their countries with new skills.

One of the most recent measures to encourage freedom of movement is the adoption in April 2014
of Directive 2014/54/EU on measures facilitating the exercise of rights conferred on workers in the
context of freedom of movement for workers, which specifically provides for new means of redress
for workers discriminated against, including conciliation and mediation, and for defence bodies to
be set up in each Member State with the tasks of providing independent legal or other assistance to
EU workers. . In its resolution of 16 January 2014 on respect for the fundamental right of free
movement in the EU, Parliament recalled that the right of free movement for work purposes
cannot be associated with abuse of social security systems, and called on the Member States to
refrain from any actions that could affect the right of free movement.

So, free movement of workers is a fundamental principle in the European Union. It stimulates the
economic, social and cultural cohesion of the Union. However, workers are not “merchandise” that
can be moved around and exploited at the cheapest price, in defiance of national legislation and
collective bargaining systems. They are persons with a wide range of fundamental freedom and
rights. In Europe we are faced with a process of disintegration rather than integration. The
European Union is called upon to decide what to be in the near future, which way to go; is asked to
choose whether to return to a purely mercantilist connotation or if further develop the social
dimension, and at the heart of their policy rights of the person, becoming a real free movement, in
which all citizens and not, can move freely. The challenge is undoubtedly challenging but you must
try to deal with it if you do not want to give up the realization of that project worthy of a Europe
"whole and free".