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The Dutch approach to Flexicurity: The Netherlands compared to other EU countries and Turkey

The Dutch approach to Flexicurity: The Netherlands compared to other EU countries and Turkey. WORKSHOP ON FLEXIBILITY OF LABOUR MARKETS Ankara, Turkey February 21 2011 Dr. Hester Houwing UWV Expertise Centre (Agency for employee benefits) Hester.houwing@uwv.nl. Content.

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The Dutch approach to Flexicurity: The Netherlands compared to other EU countries and Turkey

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  1. The Dutch approach to Flexicurity: The Netherlands compared to other EU countries and Turkey WORKSHOP ON FLEXIBILITY OF LABOUR MARKETS Ankara, Turkey February 21 2011 Dr. Hester Houwing UWV Expertise Centre (Agency for employee benefits) Hester.houwing@uwv.nl

  2. Content • What is flexicurity? • Flexicurity in the Netherlands • Comparison of key indicators • Outcomes of flexibility/flexicurity in Netherlands • How to develop flexicurity further?

  3. EC (2007) 8 Common Principles of Flexicurity 1. Implementation of ‘European Social Model’: flexible and reliable contracts, life-long learning, ALMPs, modern social security 2. Balance between rights and responsibilities for workers, employers, jobseekers, public authorities 3. No “one size fits all”  adapt to specific circumstances 4. Reduce divide between insiders and outsiders 5. Internal and external flexibility. Job-to-job and inactivity-to-job mobility should be supported. Good workplaces and upgrading of skills 6. Equal opportunities for: women, older, young, migrants, disabled. 7. Trust, dialogue and responsibility between social partners and public authorities 8. sustainable budgetary policies and fair distribution of costs and benefits

  4. EC (2007) 4 Pathwaysof Flexicurity 1: Tackling contractual segmentation: For segmented labour markets with insiders and outsiders. Distribute flexicurity evenly. Entry and progress 2: Developing flexicurity within the enterprise and offering transition security: For low job flows. Update capabilities and stimulate job-to-job transitions 3. Tackling skills and opportunity gaps among the workforce: Promote opportunities of low-skilled people to enter into employment and develop skills in order to obtain a sustainable position 4. Improving opportunities for benefit recipients and informally employed workers: For countries with substantial economic restructuring and many long-term benefit recipients. shift from informal to formal employment through ALMP and lifelong learning combined with adequate level of unemployment benefits.

  5. The Netherlands is an ‘example of flexicurity’ • Acoording to the European Commission (Towards Common Principles of Flexicurity, 2007) • Because of: • High share of part-time employment, with equal rights as full-time workers. • Strong involvement of social partners in developing and implementing policies • The combination of stimulating temporary employment with introducing labour rights  the Law on Flexibility and Security (1999)

  6. Dutch Law on Flexibility and Security • ‘Package deal’, negotiated by social partners • Flexibility: • More opportunities to use temporary employment • Somewhat simplification of dismissal for permanent workers • Deregulation of agency work sector • Security: • More rights for very small contracts (nature of contract and hours) • ‘No work no pay’ only for 6 months and always 3 hours paid for small (<15 hours) flexible contracts • Trial period for temporary contracts <2 yrs = 1 month. All other contracts = 2 months maximum. • Improvement rights for agency workers • Deviation from law is possible when social partners agree

  7. Important flexicurity elements in Turkey • Equal treatment, mainly women. Need for care facilities • Combat informal work (+/- half of workforce, mainly women). High flexibility but risk of exploitation and lack of coverage of social security • Role of social partners vis-a-vis the government needs to be re-examined • 2003 Turkish Labour Act. Create flexible work provisions to increase (formal) employment while providing (social) security.  Flexible work is here: temporary, parttime and on-call work Source: 2009 Matra project (cooperation with Turkish Ministry of Labour and social security; SGK, ISKUR, Turk-Is and Tisk)

  8. Paricipation rates(Data: OECD 2009)

  9. Part-time employment(Data: OECD 2009)

  10. Involuntary part-time employment (% of part-time)(Data: OECD 2009)

  11. Temporary employment (%)(Data: OECD 2009)

  12. Strictness of Employment Protection overall (Data: OECD 2008)

  13. Flexibility: worker reallocation2000-2005 (Hires and seperations)(OECD Employment Outlook 2009)

  14. Main elements of Dutch flexicurity • High increase in use of temporary workers • Temporary workers get much less training and less pay (Not equal like part-time workers) • Agency workers: Not much increase in security, but emphasis on investments in training • Deviation from the law different across sectors  negotiated by social partners • Flexibility is concentrated on a specific group (risk of dual labour market: who stays flexible?) • Related to employment protection and high costs of sickness for permanent workers • Emphasize more other types of flexibility, such as internal flexibility (e.g. telework) • Flexibility could be distributed more across groups  move from ‘job security’ to ‘employment security’

  15. Comparison to other EU countries • Denmark: • Strong increase in agency work; decrease in temporary work due to stricter EU guidelines • Equal rights for temporary work, but problems with small jobs and social security; no equal pay for agency work • High security of moving into permanent • Important role of social partners • Germany: • Strong increase in agency work and temporary work due to liberalisation of rules • Equal rights for temporary work, but problems with small jobs and social security; no equal pay for agency work in collective agreements between social partners • medium security of moving into permanent • Social partners disagree on flexible work • United Kingdom: • Increase in agency work; decrease in temporary work due to stricter EU guidelines. Overall level very low • Equal rights for temporary work, but problems with build up of rights to social security; no equal pay for agency work in collective agreements between social partners • high security of moving into permanent, but very low protection • No role of social partners

  16. Further development of flexicurity in Turkey • 2003 Turkish Labour Act. Create flexible work provisions to increase (formal) employment while providing (social) security.  Does flexibility increase (Formal) employment?  What is security? ALMP? life long learning? Social security? • Good practices (do they really work?): • short-time work and short-time benefits (directed by ISKUR) • Training for job seekers (also ISKUR) • Premium reductions for weak groups • Other?

  17. Thank you for your attention! Further questions? Digital copy of PhD thesis available via: www.flexworkresearch.org Book available via hester.houwing@uwv.nl

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