Flexicurity : models and systems in the EU

1. Flexicurity : models and systems in the EU Flexicurity – verso i principci comuni della flexicurity ISFOL - Convegno Venezia, 30 di Maggio 2008 Greet Vermeylen, European Foundation for the Improvement of Living and Working Conditions

2. Background : some of the challenges of globalisation and demographic change • Productivity and innovation : • more flexibility needed by companies • Attract and keep a motivated workforce • Ageing: • Employment careers will be longer : keep workforce fit and able to work for a longer period • Fertility rate : • work-life balance for men and women • Flexicurity : • employment security, training, job development, ‘easing’ of transitions • Life course perspective: transitions

3. From a dynamic concept ... • Flexibility covers an ever-widening range of situations e.g. the High Performance workplace, employment contracts, flexible working time arrangements etc • A domination of the short-term : from mass-production to ‘flexible’ tailored production, ‘shorter contracts’, changes in working hours • Hence, heterogeneity over homogeneity

4. … to a workable concept

5. Quantitative flexibility : Temporary employment / part-time work - 2007 data (LFS)

6. Qualitative flexibility • External • The existence of subcontracting chains • Contracting out strategic activities of high added value • Contracting out non strategic activities of low added value • Internal • Job enrichment, multi-skilling, working in teams , project groups

7. Some challenges • Different accents over the countries: choices embedded in labour market structure and systems • External flexibility : often only for part of the workforce • Particular contractual arrangements which offer flexibility (FTC, TAW) • Risk of labour market segmentation • Internal flexibility (working time or functional flexibility) • equiping workers to deal with changes (employment security) • Important to make transitions possible

8. Flexicurity • flexicurity : integral combination of flexibility-oriented and security-oriented policies • Combination of policy measures introduced simultaneously • Need to tackle flexibility and security together • Main idea: security does not come from ‘job security’ but from security in employment and during transitions

9. Flexibility and social protection • For employers: • social protection systems might be regarded as a burden (inappropriateness to new economic realities) • For workers in flexible forms of employment: • social protection systems are not always adapted to their situation (not necessarily sufficient security) • These forms are often stimulated by states - > growing need to overcome pbs of mismatch between flexibility and security / flexicurity

10. Social protection / labour market system : how to adapt to need of flexibility / flexible workers while keeping security • Employment protection regulation (EPL) • Active labour market policies (activation / ALMP) • Transitions (unemployment benefits) • Social protection systems: • Pension schemes (how to build up decent pension over different pillars) • Parental leave / health care / guaranteed minimum income • Taking into account also a life course perspective All systems have to adapt, but each with their own particular accents

11. Aims of social protection systems • Decommodification • Short term: temporary income to overcome ‘risks’, unemployment benefits, etc • Long term: contuation of income in case of structural/ long term events (disability, pensions not linked to activities) • Employability • Ways to get back into employment: re-employment, IIary status, FTC, integration schemes in companies • Can already start before ‘getting fired’/throughout the career : development of personal projects that are not necessarily immediately profitable in the ST on the labour market, skills development / capabilities • Training, development (learning opportunities in the job), work organisation etc • 3rd one : redistribution ? • In some countries

12. Key to combine flexibility and security : trust • In the future • If people believe in the future, they will take up employment, are more flexible and combine it with having a family etc • In changes • Trust that changes are not catastrophic and that the means are there to overcome and adapt (eg Danish flexicurity model) • In work • People can plan over their life without too many inconveniences and risks for their career/pensions • Job/employment interruptions /transitions • Support structure to combine working & non-working life

13. Measures to be undertaken to make a framework for a society of trust • Social protection systems • Maternity benefits, parental leave benefits • (temporary) unemployment benefits, combined with ALMP • Adapted to new realities (eg pension rights for ‘non-standard’ workers) • Labour market measures • Flexible working time arrangements at request of employee • Employment security / Employability: training, ALMP • Smoothen transitions in fragmented careers (FT, PT, unemployment spells) • Social infrastructures • Childcare facilities, out of school care (afterschool, sick children) • While combating discrimination between men and women • Taking into account different career trajectories

14. Challenges posed between flexibility and security • Not a one fits all solution • Different ways possible with very different accents • Depend on the ‘system’ • Historically rooted (not easy to make changes, politically difficult/courage needed / certain limits) • Economic situation of the countries ->Reflection needed on how to do this in each system !

15. Flexicurity: normalisation of ‘atypical’ contracts • Eg Dutch system: • try and re-reflect upon ‘non-permanent contracts’ in order to push labour market dynamics: • Fixed-term contracts: get better rights • Temporary working agencies: idem • ‘Transition’ easing • Taking into account rights accumulated for ‘life course’

16. Flexicurity: more flexibility for all workers • Austria : Increase of occupational mobility: • Reform of severance pay system, which workers can ‘take’ with them • Berufsschutz • Entgeltschutz • Denmark: A golden triangle between : • A high labour mobility and liberal regime of employment protection (a high turnover of hire and fire) • A fairly generous and widespread social protection system (unemployment benefit, cash benefit for non-insured) • An active labour market policy – job and training offers combined with availability criteria and sanctions • + close cooperation between social partners and gvt

17. Important to ‘equip your workers’: employment security • In order to smoothen changes in (working) life (transitions) : very important to keep up to date your skills • Different ways to ensure continuous development of workers : training, work organisation etc • However, huge differences over countries / high or low skilled workers etc • Hence … room for reflection …

18. Training in the workplace: big differences over countries

19. Training paid by the employeror yourself by education and type of employment contract

20. Some of the challenges to reflect upon • Flexicurity touches upon all the spheres • National, regional, workplace AND household level • Often decisions are made at the kitchen table • Sustainability of the system • Economic situation & trust • Social infrastructure for an inclusive LM (eg affordable child care, etc) • Life course : building up of rights (eg pension rights, second pillar schemes) • Risk of losers of this model: • Low qualified ? • ‘Vulnerable workers’ / new generation of working poor? -> hence : a holistic reflection needed

21. Summing up … • Flexicurity : potential to enhance competitiveness : • most important element: reflect on rights and tools for workers • Combination of different forms of flexibility: • With external flexibility: careful for labour market segregation / are transitions possible? • With internal flexibility: • could be way to combine work and personal life (decisions at kitchen table) • way of enhancing employability/employment security for workers (functional flexibility) • Trust is vital ingredient: • Involvement of all actors (companies, social partners, governments) • Employment security : • Rights: social protection rights / all pillars / life course • Tools: specific attention to most vulnerable / employability (equip workers to deal with change) / skills building / training and work organisation

22. Thank you More info : www.eurofound.europa.eu Email: gve@eurofound.europa.eu