The European Parliament wants subcontracting to come out of the shadows. MEPs call on the European Commission to rein in the tangled chains of contractors and labour brokers that sprawl across Europe’s building sites, warehouses and delivery depots.
The own-initiative resolution, drafted by MEP Johan Danielsson (S&D/SWE), found the backing of 332 members in Thursday’s plenary vote in Strasbourg. Another 209 members voted against it, and 33 abstained. The result obliges the Commission to respond within three months; it may then propose a directive.
Mr Danielsson’s text asks Brussels to cap subcontracting chains at two tiers, introduce an EU-wide licensing system for labour intermediaries and forbid those intermediaries from charging fees to workers. It also seeks joint-and-several liability for wages, social-security contributions and safety duties along the entire chain. Cross-border enforcement would be beefed up through the European Labour Authority and national inspectorates.
Closing the loopholes
Supporters say the reforms would wipe out the grey zones where rogue gangmasters thrive. As a trade-union campaign has put it, “Long, opaque chains enable criminal gangmasters.” Parliament’s Employment and Social Affairs committee had earlier endorsed the report by 35 votes to 20.
Trade unions argue that shorter chains will lift pay and raise safety standards. They note that similar limits already exist in some collective agreements and that a posting-of-workers review has hailed them as good practice. Because every contractor would be liable for unpaid wages or accident claims, the temptation to outsource risk to the last link should shrink.
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Business groups see it differently. The European freight lobby warns that the two-tier cap “would make complex supply chains unmanageable, inflate empty-run rates and push companies to vertically integrate, harming competition.” A legal study for the European Enterprise Institute brands the idea “unprecedented in EU law”. Employers also fret that open-ended liability will push insurance premiums up and deter prime contractors from hiring small specialist firms.
Waiting for Brussels
Cost estimates diverge. Transport federations talk of two-to-four-percent rises in road-freight costs. Swedish employers foresee a seven-percent jump in construction prices over five years. No official impact assessment exists; figures come from sectoral papers waved during the debate.
Under Article 225 of the EU treaty, an own-initiative resolution cannot impose law. It can, however, force the Commission to explain itself. If the executive agrees with the Parliament’s plea, it must table a proposal within twelve months. If it refuses, it must supply detailed reasons, a step it takes only rarely.
Commission officials may find parts of the package convenient. Work is already under way on a Quality Jobs Roadmap, into which licensing for labour intermediaries could slot neatly. The harder sell will be the two-tier cap, which divides member states. Some apply strict limits already; others rely on collective bargaining or sectoral rules. Reaching a qualified majority in the Council will be tricky.
From paper to practice
Still, the political climate helps. Europe’s voters bristle at reports of wage theft and grim living quarters for migrant workers. For governments, shaping an EU-wide rule may look safer than fending off accusations of inaction.
If the Commission picks up the baton, the next step will be an impact study in 2026-27, followed by a proposal that the new Parliament elected in 2029 would debate. Implementation would then fall to national labour inspectors alongside the European Labour Authority, whose mandate would widen. Parliament wants that body to share data with Europol to pursue cross-border wage fraud.
Even without a directive, the resolution has nudged standards. Large contractors know that a future law could make them liable for every payslip down the chain. Many will start pruning subcontracting layers and demanding clearer records from brokers. Some may shift to licensed agencies early to keep customers calm.
Europe has often struggled to police its own single market. Goods cross borders easily; employment rules less so. By drawing a sharp line after the second subcontract, Parliament hopes to align market freedom with social protection. Critics insist the medicine is too strong; backers say anything weaker will leave the sick patient unattended.
