Employment policy guidelines (2005-2008)

In eight guidelines for higher employment in the European Union (EU), the Commission focuses on policies designed to achieve full employment, for example by improving inclusion of people at a disadvantage, greater investment in human resources, adaptation of education and training systems and more flexibility combined with job security.

ACT

Council Decision 2005/600/EC of 12 July 2005 on guidelines for the employment policies of the Member States.

SUMMARY

The integrated guidelines for growth and jobs for the period 2005-2008 bring together, in a single, coherent and simplified text, the Broad Economy Policy Guidelines (BEPGs) and employment guidelines. They are the principal policy instrument for developing and implementing the Lisbon Strategy.

The employment guidelines are thus presented in an integrated policy instrument * which covers both the macroeconomic and the microeconomic aspects of the European Union (EU), presents a clear strategic vision of the challenges facing Europe and enables the Union to channel Member States’ efforts towards priority measures. Certain employment guidelines are to be implemented in line with the corresponding guidelines in other areas in order to mutually strengthen the different sectors of the economy.

Firstly, to attract more people into employment and modernise social protection systems, the Commission proposes to:

• Implement employment policies intended to achieve full employment, improve quality and productivity at work, and strengthen social and territorial cohesion (Integrated Guideline No 17). These policies should help to achieve an average employment rate for the European Union (EU) of 70% overall, at least 60% for women and 50% for older workers (55 to 64), and to reduce unemployment and inactivity. Member States should set national employment rate targets.

• Promote a new lifecycle approach to work (Integrated Guideline No 18) through:- renewed endeavours to build employment pathways for young people and reduce youth unemployment, as recommended in the European Youth Pact,- resolute action to increase female participation and reduce gender gaps in employment, unemployment and pay,- better reconciliation of work and private life and the provision of accessible and affordable childcare facilities and care for dependants,- support for working conditions conducive to active ageing,- modernisation of social protection systems, including pensions and healthcare, to ensure their social adequacy, financial sustainability and responsiveness to changing needs, so as to support participation in employment, remaining at work and longer working lives.

This guideline should be applied taking into account Guideline No 2 â€œTo safeguard economic and fiscal sustainabilityâ€.

• Ensure inclusive labour markets, enhance work attractiveness, and make work pay attractive for job-seekers, including disadvantaged people and the inactive (Integrated Guideline No 19) through:- active and preventive labour market measures, including early identification of needs, job search assistance, guidance and training as part of personalised action plans, and provision of necessary social services to support the inclusion of those furthest away from the labour market and contribute to the eradication of poverty,- ongoing review of the incentives and disincentives resulting from the tax and benefit systems, including the management and conditionality of benefits and a significant reduction of high marginal effective tax rates, notably for those with low incomes, whilst ensuring adequate levels of social protection,- development of new sources of jobs in services for individuals and businesses, notably at local level.
• Improve matching of labour market needs (Integrated Guideline No 20) through:- the modernisation and strengthening of labour market institutions, especially employment services, also with a view to ensuring greater transparency of employment and training opportunities at national and European level,- removing obstacles to mobility for workers across Europe within the framework of the Treaties,- better anticipation of skill needs, labour market shortages and bottlenecks,- appropriate management of economic migration.

Secondly, to improve the adaptability of workers and enterprises and the flexibility of labour markets, the Commission proposes to:

• Promote flexibility combined with employment security and reduce labour market segmentation, having due regard to the role of the social partners (Integrated Guideline No 21) through:- adaptation of employment legislation, reviewing where necessary the different contractual and working time arrangements,- addressing the issue of undeclared work,- better anticipation and positive management of change, including economic restructuring, for example changes linked to the opening of markets, so as to minimise their social costs and facilitate adaptation,- promotion and dissemination of innovative and adaptable forms of work organisation, with a view to improving quality and productivity at work, including health and safety,- facilitating changes in occupational status, including training, self-employment, business creation and geographical mobility.

This guideline should be applied taking into account Guideline No 5 â€œTo promote greater coherence between macroeconomic, structural and employment policiesâ€, in relation to macroeconomic policy.

• Ensure employment-friendly labour cost developments and wage-setting mechanisms (Integrated Guideline No 22) by:- encouraging social partners within their own areas of responsibility to set the right framework for wage bargaining in order to reflect productivity and labour market challenges at all relevant levels and to avoid gender pay gaps,- reviewing the impact on employment of non-wage labour costs and, where appropriate, adjusting their structure and level, especially to reduce the tax burden on the low-paid.

This guideline should be applied taking into account Guideline No 4 â€œTo ensure that wage developments contribute to macroeconomic stability and growthâ€, in relation to macroeconomic policy.

Thirdly, to invest more in human capital through better education and skills, the Commission proposes to:

• Expand and improve investment in human capital (Integrated Guideline No 23) through:- inclusive education and training policies and action to ensure significantly easier access to initial vocational, secondary and higher education, including apprenticeships and entrepreneurship training,- significantly reducing the number of early school leavers,- efficient lifelong learning strategies open to everyone in schools, businesses, public authorities and households according to European agreements, including appropriate incentives and cost-sharing mechanisms, with a view to ensuring lifelong participation in continuous and workplace training, especially for the low-skilled and older workers.

This guideline should be applied taking account of Guideline No 7 â€œTo increase and improve investment in R&D, in particular by private businessâ€, in relation to microeconomic policy.

• Adapt education and training systems in response to new competence requirements (Integrated Guideline No 24) through:- raising and ensuring the attractiveness, openness and quality standards of education and training, broadening the supply of education and training opportunities, ensuring flexible learning pathways and increasing mobility possibilities for students and trainees,- facilitating and diversifying access for everyone to education, training and knowledge through the organisation of working hours, family support services, career guidance services and, where appropriate, new forms of cost-sharing,- responding to new occupational needs, key competences and future skill requirements by improving the definition and transparency of qualifications, their effective recognition and validation of non-formal and informal learning.

Updates during the period up to 2008 should be strictly limited. The Commission is presenting the Integrated Guidelines as part of the mid-term review of the Lisbon Strategy.

RELATED ACTS

Council Decision 2007/491/EC of 10 July 2007 on guidelines for the employment policies of the Member States [Official Journal L 183 of 13.7.2007]. As in 2006, the Council maintained its guidelines in 2007 but stressed that they should be taken into account by the Member States in their policies.

Council Decision 2006/544/EC of 18 July 2006 on guidelines for the employment policies of the Member States [OJ L 215 of 5.8.2006]. In view of the essential role of employment policies under the Lisbon agenda, the Council urged the Member States to ensure the application of all the 2005–2008 guidelines as part of their national employment programmes. Updating of these guidelines should be limited in order to ensure the stability necessary for effective implementation. The Council therefore decided not to amend the guidelines for 2006.

Last updated: 03.10.2007