EU Risks Breakup Without Social Dumping Reform: Macron

The EU risks breaking up unless it overhauls a controversial rule allowing firms to send temporary workers from low-wage countries to richer nations without paying their local social charges, French President Emmanuel Macron

BUCHAREST, , (APP - UrduPoint / Pakistan Point News - 24th Aug, 2017 ) - The EU risks breaking up unless it overhauls a controversial rule allowing firms to send temporary workers from low-wage countries to richer nations without paying their local social charges, French President Emmanuel Macron said Thursday.

"Some political or business circles seek to use the EU's funds while at the same time developing a system of social and fiscal dumping," he said in Bucharest during a whistle-stop visit to eastern and central Europe.

"This will lead to the dismantling of the European Union" if there is no reform agreement at a Brussels summit in October, he added after holding talks with Romanian President Klaus Iohannis. Macron made the remarks on the second leg of a three-day tour through Austria, Romania and Bulgaria, as he seeks to drum up support for his ambitious reform proposals.

The so-called Posted Workers Directive has come under fire from wealthy nations like France, which argue that the rule amounts to "social dumping" in which payments to costly health and welfare systems are avoided.

Backed by Vienna and Berlin, Paris wants the job duration of detached employees to be limited to 12 months -- half the period proposed by the European Commission. France also demands greater efforts to fight fraudulent use of the directive, under which 286,000 people were employed in the country in 2015.

The topic has become a political hot potato pitting western EU members against their poorer neighbours in the former communist bloc, where most of the cheap labour comes from. Eastern and central European governments say Macron's proposals go too far and will undercut their competitiveness.

However, there were signs of a breakthrough after discussions with the heads of state of Slovakia and the Czech Republic in Salzburg on Wednesday. Slovak Prime Minister Robert Fico acknowledged that finding a solution would be "good news for the EU".