Cowboys to fly EU flags of convenience

The prospect of cowboy contractors operating outside the law under "flags of convenience" is a step closer thanks to a proposed EU directive.

The directive on services in the internal market is intended to open up the EU market to competition. But, it is claimed, the present wording means firms that are formally established in a foreign country may not necessarily be bound by the laws and regulations of another country in which they are working. Thus they could, for example, avoid local health and safety legislation.

Construction employers and unions in Europe have joined together to warn that this could lead to widespread unfair competition and undermine health and safety legislation.

UCATT general secretary George Brumwell said: "We believe the proposed directive could have devastating consequences for health and safety at work laws."

European Federation of Building and Woodworkers secretary Werner Buelen said: "According to the proposed directive, the European member states have very limited rights to check, inspect, investigate, and take appropriate measures when service providers operate unlawfully or when workers are unlawfully employed according to the regulations of the country of posting.

"This would imply that preventive measures relating to the health and safety of the workers, the technical and financial capability of the company, the payment of the fiscal and social charges, and so on, imposed by some member states could not be imposed on foreign service providers - although they are applicable to the local construction companies," Buelen concluded.