Our latest roundup of news from the Federation of European Employers (FedEE).
Europe: Creative ways to deal with downturn
Faced with a sharp drop in demand, many companies across Europe are finding new ways to reduce costs and avoid redundancies:
- Employees at Renault's engine plant in Valladolid, Spain, agreed to take early leave days in order to avoid lay-offs planned for later December.
- Opel's Gliwice factory in Poland reduced shifts from three to two and transferred part of its workforce to perform tasks previously carried out by outsourcing services.
- In Denmark, pensions and investments company Skandia is allowing its employees to take time off each month to carry out volunteer work with a national charity.
- In the Irish Republic, financial services company Permanent TSB introduced a number of incentives for staff to take career breaks of up to three years.
- Following a federal court case in 2006, many companies in Germany are requiring employees to use frequent flyer air miles generated through corporate travel to pay for further business trips.
These measures are in addition to common cost-cutting methods such as temporary plant closures and lay-offs, pay freezes, reducing overtime and discontinuing the use of agency workers.
Germany: Changes effective in January 2009
A number of important social security reforms and amendments will take effect in Germany on 1 January 2009. These include:
- The establishment of a standard 15.5 percent contribution rate for Germany's new public health fund applicable up to a maximum income of EUR 3,600 a month. If an employee earns at or above this upper earnings threshold, they will pay EUR 295 and their employer EUR 263 a month. Although the standard rate will be fixed, individual insurers will be able to charge an additional 1 percent if they run out of funds.
- A reduction in the contribution rate for German unemployment insurance from 3.3 percent to 2.8 percent.
Further safeguards will also be introduced into the German system for individual working time accounts (Arbeitszeitkonten). These will provide stronger protection against bankruptcy and facilitate the transferability of funds between employers when employees change jobs. Such accounts became popular in recent years because they allow employees to store up overtime hours and bonus payments in the form of time credits to be used later for sabbaticals, training, early retirement or the improvement of pension provisions.
Sweden: Revised immigration rules
A new immigration law was approved by the Swedish parliament that will place responsibility onto individual employers to decide whether they need to recruit third country employees to fill certain posts. They will thus take over from the public employment service (Arbetsförmedlingen) for the recruitment of foreign workers.
From 15 December 2008, an employer must continue to give preference to EEA or Swiss applicants. However, if there is no suitable applicant from one of these free movement zones, they may choose to fill a vacancy with a worker from another country. If a job offer is made, the applicant must obtain a work permit (and, if necessary, a visa) through the Swedish embassy in their home country before travelling to Sweden to take up their new post. Employers will be obligated to ensure that employment terms and conditions are in line with collective agreements or the relevant labour market.
A temporary permit will be granted either for the duration of the employment or for a maximum of two years. If the employee leaves their employer for any reason whilst their permit is still valid they will have three months to find a new post in Sweden. The Swedish Migration Board will monitor the system and carry out spot checks to ensure that procedures are being correctly followed.
OTHER EUROPEAN NEWS IN BRIEF
Czech Republic:
From 1 January 2009, all non-EEA (or Swiss) citizens wishing to obtain a permanent residence permit in the Czech Republic must first complete a mandatory Czech language course and pass a proficiency test.
Denmark:
The central tax administrative authority in Denmark announced that the tax exemption limit on Christmas and New Year gifts from employers was raised from SEK 500 (EUR 47) to SEK 700. This exemption only applies to gifts in kind and not to monetary awards or vouchers that can be exchanged for cash.
Europe:
The latest OECD Economic Outlook report predicts that employee compensation in the eurozone will rise by an average of 2.4 percent in 2009 and 2.1 percent in 2010. Outside the eurozone, the main projected increases for 2009 are 6.0 percent in the Czech Republic, 4.5 percent in Denmark, 6.3 percent in Hungary, 4.7 percent in Norway, 6.1 percent in Poland, 5.6 percent in the Slovak Republic, 2.9 percent in Sweden, 1.6 percent in Switzerland and 3.2 percent in the UK.
Irish Republic:
The recently published Irish finance bill includes a new annual tax of EUR 200 on employees who park their cars in company car parks. The levy will only apply to workplaces in the cities of Cork, Dublin, Galway, Limerick and Waterford. Concessions will be available for part-time and shift workers and drivers with disabilities will be exempt. If the bill is approved by parliament, the levy will be applied from 1 January 2009 and will be collected through payroll deductions.
Malta:
Malta's government announced a new measure to encourage mothers to return to work. From 2009, new mothers (with children born on or after 2007) and women who were out of the workforce since 2004 or earlier (with children under 16 years old) will enjoy exemption from income tax for 12 months following their return to work.
Netherlands:
Continued restrictions on access to the Dutch labour market for Bulgarian and Romanian workers were agreed by the lower house of the Dutch parliament. The social affairs minister, Piet Hein Donner, earlier proposed that work permit requirements should be lifted on 1 July 2009, but the overall parliamentary consensus is for borders to remain closed until 2011.
Portugal:
From the start of 2008 to the third quarter, hourly labour costs in Portugal rose by an average of 5.4 percent. Over the same period, however, the number of actual hours worked decreased by 1.5 percent. Exclusive of changes in working time, labour cost increases ranged from 1.7 percent in transport, storage and communications to 11.1 percent in the finance sector.
Russian Federation:
The Russian government declared that Friday, 9 January 2009 will be a non-working day and that Sunday, 11 January 2009 will replace it as a normal working day.
Switzerland:
Passport control points at Swiss national border crossings will be dismantled on 12 December 2008 when Switzerland joins the Schengen zone. However, customs officials will still carry out spot checks on vehicles to combat trafficking in arms, stolen goods and illegal substances. Passport controls at airports will be removed when new flight timetables are introduced at the end of March 2009.
United Kingdom:
The UK's information commissioner is to be given new powers to investigate potential contraventions of the Data Protection Act and to issue spot fines to offenders. The annual flat-rate notification charge made on companies holding personal data is also to be replaced by a tiered fee structure based on the size of the notifying organisation. According to the Ministry of Justice, the necessary legislation will be introduced as soon as the parliamentary schedule allows.
December 2008
Copyright: FedEE Services Ltd 2008
Text size
Twitter
LinkedIn
Facebook
Flickr
0
