Belgium to sign on to European labour fraud proposal

Summary

Social dumping in Europe – when cheaper labour is hired from eastern Europe to perform work further west – is being tackled by Belgium in co-operation with other countries

‘The same wage for the same work in the same place’

Federal labour minister Kris Peeters has come out in support of a Europe-wide proposal to combat social dumping in the road haulage sector. The issue concerns companies that set up fake subsidiaries in eastern Europe and employ lorry drivers from those countries to drive routes in western Europe.

The practice, known as social dumping, undercuts the wages of local drivers and allows the employers to avoid paying social security charges. The French and German governments have presented a proposal to tackle the problem at the European level.

Countries in western Europe, including Belgium, are home to businesses that hire employees from elsewhere, pay them wages on the level of their homeland and avoid paying Belgian social charges. Social dumping is a form of unfair competition, compared to companies that employ local drivers.

It is unacceptable for companies to set up fictitious subsidiaries in eastern European countries to work with employees with an eastern European contract, and let them work for a low wage in Belgium,” Peeters said. “The principle ought to be that people get paid the same wage for the same work in the same place. We support the French and German proposal to put an end to secondments by PO Box companies.”

Peeters now intends to send a letter, co-signed by prime minister Charles Michel, to French president Emmanuel Macron expressing support for the proposal. According to the proposal, all companies would be required to make one-quarter of their earnings in the country in which they are established. Only then would they be allowed to put drivers to work in another member state.

It was recently reported that federal labour authorities infiltrated at least one Limburg-based road haulage firm that was using eastern European drivers from a fake subsidiary. The ongoing investigation into the company is being carried out with the co-operation of legal authorities in Slovakia.

Photo: Ingimage