Free movement of persons and services in the European road sector (3 days)
652.21.ECB

Beatrice Hertogs from the European Transport Workers' Federation outlined the objectives of this seminar.

• To make a survey of the state of play of the Road Transport Sector taking into account how the Enlargement of the EU impacts on the transport flows and how working conditions are influenced.
• To examine the tools trade unions can use in order to defend the interest of the workers, as well when it comes to legislation, social dialogue and cross border networking.
• To develop proposals for action plans involving the ETF and national trade union organisations.

The programme of the seminar and the ETUI-Education activities were presented by Jean-Claude Le Douaron. He emphasized that the purpose of the seminar was to exchange experiences and develop proposals but that decisions have to be taken in the national trade union bodies and/or in the ETF Road Committee.

Employment in road freight and passenger transport
Beatrice Hertogs presented an overview over the trends and the evolution of the road transport sector:

• In the majority of the Member-states of the EU,the road freight transport sector accounted for a very high proportion of employment , compared with other modes of transport.

• Only CZ and SK have a higher employment figure in road passenger transport
• However, DE has the highest figure in “other auxiliary transport activities”
• In BE, FR, IT, UK this category follows, in number of persons employed, the road freight sector

Conclusions regarding employment and trade-unions

• Road freight as well as passenger transport have the highest employment figures in comparison with other modes of transport
• However, we have to pay attention to the employment of ‘other auxiliary transport activities’
• Those trends are important for future trade-union affiliation and action

Trends in road freight transport

• European road transport in 2004 was dominated in tonnage terms by the 5 major economies, DE, Fr, ES, UK ,IT for which international transport is relatively minor compared with national transport
• For NL,AT,DK,and especially BE, international transport was more significant
• This is also true for EE,LV,LT,SLO, and LU
• DE was the largest force in both intra-and extra-EU international transport
• For intra-EU transport, hauliers from FR,BE,NL also have significant shares.
• For extra-EU transport, SE and IT came to the fore as the other main players.
• But PL and FI also emerged as significant players
• Polish national carriers accounted for a very high proportion of that country’s international transport movements
• a marked contrast with French hauliers , who contributed only 34% to their outgoing international transport
• The largest country to country flow , when considering tonne-km was between FR and ES
• Among the new MS, both the CZ and PL accounted for 3% of the total tonnes moved in intra-EU international transport (2004)
• Among the countries with major international trade flows ,carriers from the Netherlands accounted for around two thirds of that country’s international tonnage
• The volume of national transport, which has the largest share of transport in the EU, is still growing at an annual rate of 1,5% between 1999 and 2003
• International transport is growing at an average rate of 2,5%
• Road cabotage transport performance has almost doubled in 1999-2004, despite its small share in total EU transport
• Cabotage is very important in some areas .in BE and FR, 2% of total domestic transport is in the hands of foreign hauliers
• Definition of cabotage poses difficulties , especially the temporary character
• It seems that in 2004 the EU was still trading as two separate blocs
• For the new MS, penetration of their international flows comes largely from other new MS
• The EU-15 had very high levels of penetration of each other’s international transport
• BE,FR,IT,SE, UK all saw half or more of their international transport tonnages taken by carriers from other EU-15 countries
• In terms of exchange of the two blocs, the EU-15 countries recording the highest levels of new MS penetration are DE,AT,SE, all with more than 10% of their international tonnage taken by new MS carriers.
• BE,NL,FR,IE,LU,PT recorded figures less than 5%
• Among the new MS, the countries more open to the EU-15 penetration are SLO and HU with 15% and CZ with 9% of their tonnage transported by hauliers from the EU-15
• ATTENTION We are speaking about OPERATORS not DRIVERS !!

Conclusions

• The flows of goods in new MS come from other new MS
• However, in SE,DE, AT more than 10% of their international tonnage is taken by new carriers
• SLO , HU, CZ are more “open” to carriers of the EU-15
• Cabotage is increasing

Trends in passenger road transport

• Buses and coaches are the most important mode of passenger transport (except of course for the individual car)

Employment in road freight and passenger transport

• In the majority of the Member-states of the EU,the road freight transport sector accounted for a very high proportion of employment , compared with other modes of transport.
• Only CZ and SK have a higher employment figure in road passenger transport
• However, DE has the highest figure in « other auxiliary transport activities «
• In BE,FR,IT,UK this category follows, in number of persons employed, the road freight sector

Conclusions regarding employment and trade-unions

• Road freight as well as passenger transport have the highest employment figures in comparison with other modes of transport
• However, we have to pay attention to the employment of ‘other auxiliary transport activities’
• Those trends are important for future trade-union affiliation and action

Labour market
Per-David Wennberg from the Swedish Transport Workers' Federation analysed the labour market and introduced some data about the Road Transport sector in Europe:

• Gender : the sector is male-dominated

• Age and seniority: in general the sector has relatively few younger and relatively many older employees
• A small company sector /the number of employees working in companies of 0-9 employees is large, except FI, FR, NL
• In some countries % of self-employed is relatively large as in DK,ES, IT. There is probably a problem with bogus self-employed in order to circumvent social legislation
• Usually permanent contracts
• Very few part-time contracts but in FI strike on the issue of part-time labour (10% of bus drivers)on a wage guarantee system
• Lifelong training doesn’t belong to the sector culture although transporting dangerous substances or working with new technological devices requires specific training
• Undeclared, illegal work and practices

Health and well being issues

• High accident , disease and disability incidence rates
• Persistence of muscular-skeletal problems)
• Violence, lack of safe rest facilities
• Exposure to noise, vibrations, air pollutants
• (un-)safe loading and unloading vehicles
• Prolonged sitting
• Work-life balance: long working hours, high geographical mobility in particular in international transport
• Stress
• Lack of job autonomy
• Burn-out symptoms

The Emergence of Logistics
Roger Sealey, researcher at the British Transport and General Workers' Union analysed the threats and opportunities resulting from the emergence of logistics in transport sector.

Logistics Drivers

• Firms Concentrate on Core Competence – Lean Techniques
• Outsourcing
• Off-shoring or near shoring
• Information, Computers and Technology (ITC)
• Globalisation

Lean Techniques

• Just-in-Time Systems
• Minimum Inventory
• Goods are pulled through system
• Customers have power rather than producers

Outsourcing Logistics

• Transport not a core competence
• Does not add value
• Outsourcing exposes logistics function to market forces
• However may keep some logistics functions in-house to use as a comparator
• Logistics becomes a variable cost

Off-shoring

• Manufacturing moves to low cost countries in far east – off-shoring – or eastern Europe near-shoring
• However still needs logistics function
• But transport/logistics is a derived demand

ICT

• Logistics companies highly dependent on information, computers and technology (ICT)

Globalisation

• Capital has always been global
• So what is new?
• Increasingly capital mobile
• Assisted by ITC
• New centres of manufacturing

What is logistics?

• ‘… a business planning framework for the management of material, service, information and capital flows. It includes the increasingly complex information, communication and control systems required in today's business environment.’ -- (Logistix Partners Oy, Helsinki, FI, 1996)

What logistics covers

• Road transport including road hauliers
• Railways
• Sea and inland waterways cargo handling facilities
• Shipping lines
• Pipelines
• Warehousing
• Air cargo

Key Logistics Segments

• Post Offices
• Railways
• Freight Forwarders
• Parcels networks
• Third party logistics providers
• Airlines

The significance of logistics

• ‘it is difficult to visualize accomplishing any marketing, manufacturing, or international commerce without logistics’. (Bowersox, 2002: 31)

Third-party logistics providers

• Third-party companies perform functions that can encompass the entire logistics process, or, more commonly, selected activities within the process.
• (Maltz & Ellram, 2000: 69)

Market is consolidating

• Firms in the main are getting larger due to takeovers rather than organic growth

Total logistics Revenue €m and growth % 2004

Tier One	Exel	8,960.8	25.2%
	Schenker	8,042.0	17.3%
	NYK	7,975.8	7.0%
	Kuehne & Nagel	7,431.6	21.2%
	DPWN	6,786.0	15.4%
Tier Two	Logista	4,406.4	8.0%
	TNT Logistics	4,081.7	9.3%
	Panalpina	3,964.8	14.1%
	Ryder	3,775.9	7.2
	Geodis	3,370.6	15.4%

Companies are vulnerable

• Reduced level of inventories has increased company profitability. Converted storage space into display space, storage space is now the lorry or the distribution centre.

Less Inventory

• New technology and more information have allowed corporations to hold less inventory, and move what they have faster through the system. Even the humble warehouse has become a high-technology “hub”, “distribution centre” or “strategic stocking location”.

Just-in-time

• Today many suppliers delay finalising their order until the last moment. This minimises inventory and maximises the ability to respond to the customer’s order.

Pulled through the system

• A management description of modern supply network would be described as allowing goods to be produced and delivered in the right quantities, to the right place at the right time in a cost effective manner.

Increased Uncertainty

• Uncertainty in the supply network has increased due to increased outsourcing and the off-shoring of manufacturing.

Weaknesses and Vulnerability of the Supply Chain

• The complexity and inter-connectedness of modern supply networks increases companies’ vulnerability to disruption. This is due to the widespread adoption by industry of ‘lean’ practices.

Robust Networks

• Researchers have devoted much effort in recent years to studying the properties that will make transportations networks robust against disruption. ‘They have stressed the importance of an architecture that allows some links within a network to do the job of others that may be damaged through accidents or design. Some networks function efficiently under normal conditions through an architecture built around hubs [or nodes] that connect many different links.

A Simple Network Diagram

The notion of networks is particularly important

• Modern supply networks are not simply linear chains or processes. They are complex networks. The products and information flows travel within and between nodes in a variety of networks that link organisation, industries and economies. The total sequence of business processes, within a network of organisations that enable customer demand for a product or service to be fulfilled.

Supply Chain Risk is Systemic

• The biggest risk to business continuity may lie outside the company in the wider supply chain. The complexity and inter-connectedness of modern supply chains increase their vulnerability to disruption and the risk is created through the companies’ own decisions.

Efficiency vs. redundancy

• If there are too few hubs, the network can break down dramatically when one of them fails. The more hubs there are, the more robust is the network against disruption (you can reroute through another hub) the cost is redundancy – building more links than you normally need’ (Seabright 2004: 251)

The Future

• Takeovers and mergers to take out overcapacity
• New rules of competition – competition between supply chains
• Business environment will become increasing unstable. This is due to a number of factors. Product and technology life-cycles are shortening

Your time has come!

“Transport workers now occupy a new strategic position in the global economy”

BBC Newsnight August 2002

• Understand your environment and use your strengths!

Identifying and prioritising the main problems in the Road Transport sector

In working groups, the participants were asked to check if the facts presented square with their own national experiences and to discuss what the main consequences are for the employment and working conditions of drivers. They were also suggested to discuss what could be the main priorities for cross border trade union co-operation.

The main issues identified by the working groups were:

1. Recruitment and organising

Some experiences such as the multilingual information leaflet developed in the framework of the Baltic network were discussed and the question was raised in which way cross border co-operation could facilitaterecruitment of international drivers.

1. The working conditions regarding working and driving time, poor rest facilities, long periods away from home constitute a serious H&S problem.

A draft action plan

A draft action plan to tackle those challenges was presented by Beatrice Hertogs and debated in working groups

Organising and recruiting

• On the issue of organizing and recruiting an important mean would be to map the main hubs where lorries are loaded and unloaded. This would give a quite clear picture of which companies from which countries are involved in international road transport and could be done at national level by affiliates. A dissemination of the information gathered during this kind of mapping would allow all organisations to focus their recruitment and organising efforts.
• National organisations can also start to make an inventory of language skills among their members and shop stewards in order to prepare for cross border actions. If leaflets have to be distributed to international drivers from foreign countries, the contacts with those drivers would be facilitated if they can be approached by TU members speaking their own languages.
• The leaflet developed in the framework of the Baltic network should be translated in all EU languages and contain the contact details of all ETF affiliates organising workers of the road transport sector.
• A database containing information about EWCs in relation with the sector should be made available by the ETF.
• Within the ETF affiliates should make a formal commitment, through a common resolution or agreement about mutual assistance of their members when they work in foreign countries. Information about such a commitment should be disseminated through the leaflet.
• National trade union training activities should also be more focused on recruiting and organising. Exchange about successful practices should be systematised by ETF and ETUI-Education.

Improving working conditions for international drivers

• International drivers work quite often under conditions which constitute a serious H&S problem. Affiliates should put pressure on national authorities to step up controls about working and driving time, rest facilities and technical equipment. Effective sanctions discouraging bad employers should be adopted and an exchange of information about best practices but also about companies not respecting basic H&S requirements should be made available by ETF. At European level the issue about technical standards and rest facilities should be a main priority in the social dialogue. National affiliates should also in their collective bargaining demand that the Per Diems for drivers should be at such a level to allow them decent conditions when they are abroad.
• Bogus self employment and the lack of social security coverage is an increasing way to practice social dumping and unfair competition. Information about those problems gathered at road side checks by national authorities should be made available and synthesised to be used by ETF in the social dialogue in order to push for the adoption of a social security attestation for all international drivers in Europe. This issue should also be raised in the Interregional Trade Union Committees.
• In a long and medium term, affiliates should try to pressure for a common minimum standard in wages and working conditions to be achieved through legislation or collective bargaining at national level also covering SMEs in the road transport sector.
• International drivers should be informed about their rights to enjoy at least the same wages and working conditions as the workforce of the host country when they are involved in cabotage. The leaflet developed in the Baltic network could be used as a basis for such an information.