The European employment strategy, dating back to 1997, established common objectives for employment policy and contributed to ‘soft coordination’ among the Member States. Creating more and better jobs was one of the main goals of the Europe 2020 strategy. Since the turn of the decade, the Commission has proposed new and more ambitious targets in employment policy. EU law is relevant in certain areas, even if the responsibility for employment policy lies primarily with national governments.
Article 3(3) of the Treaty on European Union (TEU) and Articles 8-10, 145-150, 156-159 and 162-164 of the Treaty on the Functioning of the European Union (TFEU).
According to Article 3 TEU, the Union has the duty to aim at full employment and social progress. The horizontal clause in Article 9 TFEU lays down that the aim of high employment levels must be accounted for in the definition and implementation of EU policies and activities. Member States and the Union must work towards the development of a coordinated strategy for employment, particularly with regard to the promotion of a skilled, trained and adaptable workforce, and labour markets responsive to economic change, as described in Article 145 TFEU.
A. From the early stages (1950s to 1990s) to the post-2020 targets
As early as the 1950s, workers benefited from ‘readaptation aid’ in the European Coal and Steel Community. Aid was granted to workers in the coal and steel sectors whose jobs were threatened by industrial restructuring. The European Social Fund (2.3.2 European Social Fund), created in 1957, was the principal tool for combating unemployment.
In the 1980s and early 1990s, action programmes on employment focused on specific target groups, and a number of observatory and documentation systems were established.
As many Member States were facing high unemployment, the 1993 White Paper on growth, competitiveness and employment launched a debate on the EU’s economic and employment strategy by bringing the issue of employment to the top of the EU agenda for the first time.
The new chapter on employment in the 1997 Amsterdam Treaty provided the basis for establishing the European employment strategy (EES) and the permanent Employment Committee with advisory status to promote coordination of the Member States’ employment and labour market policies. The competence for employment policy remains, however, primarily with the Member States. The treaty’s inclusion of a ‘social protocol’ enhanced the involvement of the social partners (2.3.7 Social dialogue).
The extraordinary Luxembourg Job Summit in November 1997 launched the EES together with the open method of coordination - the so-called Luxembourg process, an annual coordination and monitoring cycle for national employment policies based on the Member States’ commitment to establishing a set of common objectives and targets. The EES placed a high level of employment on the same footing as the macroeconomic objectives of growth and stability.
In 2000, the Lisbon European Council agreed on the new strategic goal of making the EU ‘the most competitive and dynamic knowledge-based economy in the world’, embracing full employment as an overarching objective of employment and social policy, and on concrete targets to be achieved by 2010 (the Lisbon strategy).
Following the 2007-08 financial crisis, the Europe 2020 strategy was adopted in 2010 and the European Semester was introduced to facilitate the coordination of financial and economic policies. This 10-year strategy for jobs and smart, sustainable and inclusive growth defined a number of headline targets for the first time, including increasing the labour market participation of people aged 20 to 64 to 75% by 2020. All headline targets had to be translated into national targets by the Member States.
In 2017, the Commission presented the European Pillar of Social Rights (EPSR), which sets out 20 key principles and rights to support renewed convergence towards better living and working conditions. It is accompanied by a ‘social scoreboard’ to monitor progress. At the Social Summit in Gothenburg in November 2017, Parliament, the Council and the Commission highlighted their shared commitment by adopting a common proclamation on the EPSR.
The 2021 EPSR implementation action plan set out three EU headline targets to be achieved by 2030, including the following:
B. Strengthening coordination and monitoring
The annual monitoring cycle for employment policies within the European Semester includes the following components:
The four employment guidelines (Article 148 TFEU) present strategic objectives for national employment policies and contain policy priorities in the fields of employment, education and social inclusion. These guidelines form part of the eight integrated guidelines, which also feature four broad economic policy guidelines (Article 121 TFEU).
The employment guidelines have been gradually aligned with the EPSR’s principles (2.3.1 Social and employment policy: general principles) and have integrated elements related to the COVID-19 crisis, the green and digital transitions, fairness during the green transition, the UN Sustainable Development Goals and the Russian invasion of Ukraine.
As a key monitoring tool used in the European Semester, the Commission proposed a revised social scoreboard (annexed to the EPSR action plan). It consists of 17 headline indicators, endorsed by the Council, assessing the employment and social performance of Member States in three broad dimensions: (i) equal opportunities, (ii) fair working conditions, and (iii) social protection and inclusion.
C. Binding legal acts – EU law
Based on the provisions laid down in the TFEU relating to social affairs and freedom of movement, several related directives, regulations and decisions have been adopted to ensure minimum standards across the EU in the following key areas:
D. Coordination through recommendations and other policy initiatives
In addition to the ‘hard law’ listed above, further measures help to increase coordination among the EU Member States through ‘soft law’, including non-binding Council recommendations and other policy initiatives from the Commission.
E. Supporting EU funding instruments
A number of EU funding programmes provide support in the area of employment.
Parliament’s role in this area has developed gradually. Since the Treaty of Amsterdam came into force, Parliament must be consulted on employment guidelines before they are adopted by the Council.
Parliament gave its strong backing to the Europe 2020 strategy. A number of the initiatives aimed at combating youth unemployment stem from Parliament proposals for concrete, practical actions, namely the EU Youth Guarantee and minimum standards on internships. In its July 2014 resolution, Parliament called for an EU legal framework introducing minimum standards for the implementation of the Youth Guarantee, including the quality of apprenticeships and also covering people aged 25-30. In a 2018 resolution on the EU’s next long-term budget, Parliament called for a significant increase in funding for the implementation of the Youth Employment Initiative. In October 2020, Parliament adopted a resolution expressing concern about the voluntary nature of the Youth Guarantee (currently a Council recommendation) and called on the Commission to propose a binding instrument.
Parliament also condemned unpaid internships and urged the Commission to review existing European instruments, such as the quality framework for traineeships and the European framework for quality and effective apprenticeships. Parliament insisted that quality criteria be incorporated into the offers made to young people, including the principle of fair remuneration for trainees and interns, access to social protection, sustainable employment and social rights, to turn the 2014 framework into a stronger legislative instrument. Following that call, and to address some of those concerns, in March 2024 the Commission presented a proposal for a directive on improving and enforcing working conditions for trainees and combating regular employment relationships disguised as traineeships, and a proposal for a revision of the Council Recommendation on a Quality Framework for Traineeships.
Furthermore, Parliament supported the approach taken in the recommendation on long-term unemployment in an October 2015 resolution. Parliament’s intensive work on skills development had an impact on the European Skills Agenda. Parliament has highlighted the importance of lifelong learning and vocational education and training, including upskilling and reskilling. It has repeatedly called on the Commission and the Member States to establish a European Vocational Education and Training Area.
Parliament’s resolution of 13 March 2019 on the European Semester stressed that the EU’s social goals and commitments are just as important as its economic goals. In a resolution adopted on 10 July 2020 on EU employment guidelines, MEPs called for radical measures to cushion the shock caused by the pandemic, in particular, a revision of the forthcoming guidelines, and they highlighted the need to address youth unemployment through an improved Youth Guarantee. As the energy and cost-of-living crises unfolded, Parliament called on the Member States and the Commission to prioritise the fight against unemployment, to reinforce the SURE instrument to support short-time work schemes, workers’ income and workers temporarily laid off because of energy price increases, and to mitigate the effects of asymmetric shocks.
For more information on this topic, please visit the website of the Committee on Employment and Social Affairs.
Samuel Goodger / Monika Makay