In 2012, 32.8 Mio. persons in the EU were self-employed, accounting for 15% of total EU employment. Self-employment creates jobs and lifts people out of unemployment. The Europe 2020 strategy recognizes self-employment as key for achieving smart, sustainable and inclusive growth. However, in several EU countries self-employed workers have less favorable conditions in terms of social security. Within its supporting role, the EU promotes voluntary standards and protective measures for self-employment. The European Parliament’s Committee for Employment and Social Affairs is currently working on an own-initiative report (2013/2111 (INI)).
Eurofound defines a self-employed person as someone who works independently of an employer. Yet there are also dependent or involuntary forms in which the self-employed person strongly depends on a single employer with working conditions similar to an employee. The aim of this ‘outsourced self-employment’ is to increase flexibility and decrease labour costs also by avoiding social security contributions. Lines between both forms are blurring.
Self-employment is highest in Greece, Italy, Portugal and Romania and lowest in Luxembourg, Estonia, Denmark and Lithuania (EU-LFS 2012) with high shares in service and agriculture. Numbers of self-employed workers increased steadily from 2000 to 2009 and then dropped from 36 Mio in 2009 to 32 Mio. in 2011.
Overview
Self-employment in Europe. European Employment Observatory Review, 2010, 52 p. This report summarises national policies on self-employment. It concludes that self-employed workers are disadvantaged and/or less protected in several EU countries caused by higher social security contributions or lower ones with less protection. Outstanding is Denmark were self-employed workers have same privileges as paid employees.
Analysis
Self-employed workers: industrial relations and working conditions. Eurofound, 2009, 76 p. This study presents working conditions of self-employed workers in different EU countries with varying legal frameworks. It concludes that social security is an area of ongoing changes where the level of social security for self-employed workers depends on the level of ‘welfare regime’ in each country. A recommended policy measure is to bring maternity/parental leave conditions for self-employed workers closer to those of employees like currently practiced in Spain.
Non-Standard Employment and Labour Force Participation: A Comparative View of the Recent Development in Europe. Günther Schmid, IZA Discussion Paper No. 5087, July 2010, 55 p. This paper looks into non-standard employment forms and their impact on social security. It finds that self-employment is stagnating and therefore not creating jobs as predicted by policymakers. It also finds that self-employment often starts with a test phase under the ‘safety umbrella’ of mixing part-time dependent and self-employed work.
Fighting Discrimination on the Grounds of Pregnancy, Maternity and Parenthood. European Commission, DG Justice, November 2012, 29 p. Brings insight to maternity and parental leave regulations for self-employed workers, who are not always entitled to parental leave (e.g. Cyprus, the Netherlands, United Kingdom, Poland); adoptive and paternity leave (e.g. United Kingdom); or without right to breastfeeding breaks (e.g. Cyprus).
Country studies
Labor market conditions and self-employment: a Denmark-Spain comparison. Raquel Carrasco, Mette Ejrnæs, IZA Journal of Labour Policy 2012, 16 p. This study compares labour market conditions in the country with the lowest (Denmark) and the highest (Spain) rate of self-employment. It finds a pattern in Spain of low-income or marginalised persons being particularily attracted by self-employment which is not the same in Denmark. Moreover, in Spain unemployment is a frequent driver for self-employment, especially for those who do not receive unemployment benefits.
Self-Employed without Employees: Managing Risks in Modern Capitalism. Fabian Dekker, Politics & Policy, August 2010, Vol. 38, Issue 4, 25 p. Empirical study based on interviews with 40 self-employed workers in the Netherlands. It examines their risk perception and coping behaviour towards social risks. From a policy perspective, the findings suggest that these “new” flexible workers might need collective social guarantees in response to risks.
Self-employment and bogus self-employment in the European construction industry. 2009, 180 p. Compiles abstracts of 11 country reports; describes difference between real and bogus self-employment and explains consequences of the latter one. In-depth analysis of pensions, social security and unemployment benefits of self-employed workers in the European construction industry.
Dependent or involuntary self-employment
Social protection rights of economically dependent self-employed workers study. European Parliament Policy Department A, 2013, 126 p. This comprehensive study describes the blurring boundaries between employment and self-employment, illustrated by case studies of different sectors and countries. It concludes that clear definitions of the different forms of self-employment are needed and suggests that social security coverage should depend less on employment status. It also finds that restricted labour markets favor dependent self-employment and high non-wage labour costs.
Self-employed or not self-employed? Working conditions of ‘economically dependent workers’. Background paper, Eurofound, September 2013, 18 p. This paper looks into the position of economically dependent workers and describes differences in working conditions compared to self-employed and employees.
The new self-employed: an issue for social policy? Mies Westerveld, European Journal of Social Security, Volume 14, Issue 3, 18 p. Investigates the need for social policy driven by four country case studies from the Netherlands. Findings suggest that different forms of self-employment need different policy answers.
Boundary between self-employment and vulnerable work, informal contracts and undeclared work. Thematic Review Seminar on “Promoting entrepreneurship and self employment across Europe,” 8 – 9 November 2010, Antonella Baldassarini, 2010, 13 p. Describes various changes of self-employment in the last years, explains driving factors and suggests policy action to reduce precarious forms of self-employment f.e. by enabling access to social security support.
“Involuntary self-employment” as a public policy issue: a cross-country European review. 2009. Looks into involuntary self-employment via country studies from Finland, Germany, UK focusing on motives for involuntary self-employment, legal/economic perspectives and policy issues. It finds a similar political debate in Finland and Germany on drawing lines between dependent and independent self-employment.
Dependent self-employment: workers between employment and self-employment in the UK. René Böheim, Ulrike Mühlberger, Institut für Arbeitsmarkt und Berufsforschung, 9 May 2009, 14 p. Investigates the effect of self-employment triggered by “necessity rather than opportunity”. Data is consulted from the British Labour Force Survey 2009. It concludes that dependent self-employment does not create new jobs.
Legislation
Directive 2010/41/EU on the application of the principle of equal treatment between men and women engaged in an activity in a self-employed capacity and repealing Council Directive 86/613/EEC. This Directive lays down legal provisions on the equal treatment between men and women which applies to any other form of self-employment.
EP Parliamentary Questions and Debates – 7th legislative term
Implementation by Belgium of Directive 2010/41/EU (equal treatment of self-employed men and women), E-004706-13, Mark Demesmaeker (Verts/ALE), 26 April 2013.
Social dumping through the posting of bogus self-employed persons from third countries. E-011516-12, Jutta Steinruck (S&D), 18 December 2012.
Infringement of minimum social standards through bogus self-employment and subcontractors. E-007632/2012, Jutta Steinruck (S&D), 21 August 2012.
Health and safety regulation in relation to the self-employed. E-011777/2011, Ashley Fox (ECR), 13 December 2011.
Self-employed women and parental leave, E-006043/2011, Filip Kaczmarek (PPE), 21 June 2011.
Commission network promotes bogus self-employment. E-6049/2010, Elisabeth Schroedter (Verts/ALE) and Jutta Steinruck (S&D), 26 July 2010.
EU initiative on a clear distinction between genuine self-employment and bogus self-employed. E-5333/09, Proinsias De Rossa (S&D), 27 October 2009.
Data
Social protection of the self-employed. Situation on 1 July 2012, MISSOC, European Commission, 42 p. Comparative data and details on social security provisions on old-age, sickness, invalidity, maternity, family benefits, work accidents and unemployment for self-employed workers in EU Member States.
Self-employment in the EU. Eurostat provides tables on self-employed workers by sex, age and highest level of education attained, economic activity and occupation.
