Free Movement, Social Security and Gender in the EU 9781472564023, 9781841136226

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To the memory of my parents

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Acknowledgements This book would not have been accomplished without the help and support of many persons. I am especially grateful to Professor Ulf Bernitz for his guidance and wise advice, as well as his enthusiasm and encouragement during the years of research and writing. I want to extend my sincere thanks to Professor Ronnie Eklund for his invaluable comments on the manuscript, and for many interesting discussions. Dr Laura Carlson offered valuable comments and Professor Philippa Watson made a fruitful opposition to the original thesis: I thank them both. I also want to thank Natalia Depo for her assistance and Anna-Greta Engvall for her help in all the administrative matters. Many persons have also helped me with collecting the information and materials. Collegues and friends at the Faculty of Law and elsewhere commented on parts of the manuscript and provided help in a variety of matters. I am grateful to them all. I also want to thank Ms Mel Hamill and Ms Ruth Massey at Hart Publishing for their friendly assistance and professional preparation of the book. The research was financed by the Swedish Research Council and a scholarship from the Tore Alméns Minnesfond. The Foundation of October 28th provided funds for the purchase of books. I want to thank my family for all their understanding and patience. My husband Thomas Pettersson has supported and assisted me in all phases of this work. I would not have managed without his help. And finally, I want to thank my three children, Fanny, Andreas and Maria, for all the joy and inspiration they have given me during these years. Stockholm, March 2007.

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Table of Cases Case 75/63 Unger [1964] ECR 117.........................................................................141 Case 92/63 Nonnenmacher [1964] ECR 281 ..........................................................171 Case 31/64 Bertholet [1965] ECR 81 ......................................................................152 Case 33/65 Dekker [1965] ECR 901 .......................................................................217 Case 44/65 Maison Singer [1965] ECR 965 ...........................................................152 Case 61/65 Vaassen-Goebbels [1966] ECR 261 ......................................................217 Case 19/67 Van der Vecht [1967] ECR 345 .....................................................171, 174 Case 19/68 De Cicco [1968] ECR 473.....................................................................140 Case 35/70 Manpower [1970] ECR 1251 ...............................................................176 Case 23/71 Janssen [1971] ECR 859 .......................................................................140 Case 1/72 Frilli [1972] ECR 457.............................................................................147 Case 2/72 Murru [1972] ECR 333..........................................................................202 Case 73/72 Bentzinger [1973] ECR 283..................................................................175 Case 7/75 Mr and Mrs F [1975] ECR 679 .......................................................274, 285 Case 27/75 Bonaffini [1975] ECR 971....................................................................221 Case 50/75 Massonet [1975] ECR 1473..................................................................258 Case 39/76 Mouthaan [1976] ECR 1901 ........................................................149, 223 Case 40/76 Kermaschek [1976] ECR 1669 ......................................................285, 311 Case 76/76 di Paolo [1977] ECR 315 ......................................................................212 Case 93/76 Liegeois [1977] ECR 543 ......................................................................148 Case 102/76 Perenboom [1977] ECR 815 .......................................................171, 174 Case 35/77 Beerens [1977] ECR 2249....................................................................147, Case 66/77 Kuyken [1977] ECR 2311.....................................................................223 Case 84/77 Tessier [1978] ECR 7.....................................................................147, 158 Case 115/77 Laumann [1978] ECR 805..................................................153, 160, 285 Case 117/77 Pierik [1978] ECR 825 .......................................................................227 Case 1/78 Kenny [1978] ECR 1489.........................................................................216 Case 182/78 Pierik [1979] ECR 1977 .....................................................................160 Case 237/78 Palermo [1979] ECR 2645..........................................................145, 147 Case 69/79 Jordens-Vosters [1980] ECR 75 ............................................................244 Case 110/79 Coonan [1980] ECR 1445 ..................................................................145 Case 143/79 Walsh [1980] ECR 1639 .............................................................149, 161 Case 150/79 Commission v Belgium [1980] ECR 2621 ..........................................145 Case 70/80 Vigier [1981] ECR 229 .................................................................145, 147 Case 104/80 Beeck [1981] ECR 503 ................................................................226, 261 Case 79/81 Baccini [1982] ECR 1063 .....................................................................228 Case 92/81 Caracciolo [1982] ECR 2213................................................................214 Case 227/81 Aubin [1982] ECR 1991.....................................................................180

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xx Table of Cases Case 275/81 Koks [1982] ECR 3013 .......................................................................145 Case 276/81 Kuijpers [1982] ECR 3027 ..................................................145, 171, 175 Case 139/82 Piscitello [1983] ECR 1427.................................................................308 Case 149/82 Robards [1983] ECR 171....................................................................316 Case 150/82 Coppola [1983] ECR 43 .....................................................................174 Case 171/82 Valentini [1983] ECR 2157 ........................................................144, 160 Case 101/83 Brusse [1984] ECR 2223.........................................................171, 178–9 Case 128/83 Guyot [1984] ECR 3507 .....................................................................222 Case 191/83 Salzano [1984] ECR 3741...........................................................260, 261 Case 242/83 Patteri [1984] ECR 3171 ....................................................................180 Case 249/83 Hoeckx [1985] ECR 973 .....................................................................144 Case 267/83 Diatta [1985] ECR 567 ......................................................................297 Case 326/90 Commission v Belgium [1992] ECR 1-5517.......................................145 Case 41/84 Pinna [1986] ECR 1 .............................................................................146 Case 94/84 Deak [1985] ECR 1873 .........................................................156, 285, 304 Case 104/84 Kromhout [1985] ECR 2205.......................................................263, 285 Case 117/84 Ruzzu [1985] ECR 1697.....................................................................202 Case 122/84 Scrivner [1985] ECR 1027..................................................................144 Case 153/84 Ferraioli [1986] ECR 1401 .........................................................260, 261 Case 157/84 Frascogna [1985] ECR 1744...............................................................304 Case 254/84 de Jong [1986] ECR 671 .....................................................................145 Case 300/84 Van Roosmalen [1986] ECR 3097 ..............................................148, 159 Case 302/84 Ten Holder [1986] ECR 1821 .............................................................145 Case 1/85 Miethe [1986] ECR 1837................................................................180, 222 Case 59/85 Reed [1986] ECR 1283 .........................................................................281 Case 60/85 Luijten [1986] ECR 2365..............................................................145, 171 Case 377/85 Burchell [1987] ECR 3329..................................................................262 Case 22/86 Rindone [1987] ECR 1339 ...................................................................216 Case 43/86 de Rijke [1987] ECR 3611 ....................................................................145 Case 256/86 Frascogna [1987] ECR 3431...............................................................304 Case 313/86 Lenoir [1988] ECR 5391 .....................................................146, 231, 247 Case 147/87 Zaoui [1987] ECR 5511..............................................................285, 304 Case 192/87 Vanhaeren [1988] ECR 2411 .............................................................220 Case 236/87 Bergemann [1988] ECR 5125 ............................................................180 Case 349/87 Paraschi [1991] ECR I-4501.......................................................145, 202 Case 368/87 Troiani [1989] ECR 1333 ...................................................................145 Case C-379/87 Groener [1989] ECR 3967..............................................................129 Case 1/88 Baldi [1989] ECR 667.....................................................................225, 285 Case 9/88 Lopes da Veiga [1989] ECR 2989............................................................178 Case 24/88 Georges [1989] ECR 1905.............................................................171, 260 Case 29/88 Schmitt [1989] ECR 581 ......................................................................145 Case C-140/88 Noij [1991] ECR I-387 ...................................................171, 172, 183 Case C-168/88 Dammer [1989] ECR 4553 ............................................................260 Case C-228/88 Bronzino [1990] ECR I-531............................................144, 225, 248

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Table of Cases xxi Case C-245/88 Daalmeijer [1991] ECR I-555 ........................................145, 160, 183 Case C-324/88 Vella [1990] ECR I-257..................................................................202 Case C-2/89 Kits van Heijningen [1990] ECR I-1755......145, 158, 171, 174, 175, 183 Case 12/89 Gatto [1990] ECR I-557 ...............................................................226, 248 Case C-117/89 Kracht [1990] ECR I-2781 .....................................................260, 285 Case C-163/89 Di Conti [1990] ECR I-1829..........................................................220 Case C-216/89 Reibold [1990] ECR I-4163....................................................180, 223 Case C-251/89 Athanassopoulos [1991] ECR I-2797.............................................147 Case C-307/89 Commission v France [1991] ECR I-2903......................................145 Case C-356/89 Newton [1991] ECR I-3017 ...........................................................144 Case C-45/90 Paletta [1992] ECR I-3423 ..............................................................216 Case C-57/90 Commission v French Republic [1992] ECR I-75 .....................160, 183 Case C-198/90 Commission v Netherlands [1991] ECR I-5799..............160, 182, 183 Case C-215/90 Twomey [1992] ECR I-1823...................................................186, 227 Case C-253/90 Commission v Belgium [1992] ECR I-531.....................................145 Case C-272/90 Van Noorden [1991] ECR I-2543 ..................................................207 Case 302/90 Faux [1991] ECR I-4875....................................................................202 Case C-326/90 Commission v Belgium [1992] ECR I-5517...................................145 Case C-62/91 Gray [1992] ECR I-2737 ..........................................................207, 220 Case C-78/91 Hughes [1992] ECR I-4839 ..............................................144, 251, 285 Case C-102/91 Knoch [1992] ECR I-4341......................................................180, 223 Case C-111/91 Commission v Luxembourg [1993] ECR I-817...............192, 224, 302 Case C-153/91 Petit [1992] ECR I-4973 ................................................................152 Case C-165/91 Van Munster [1994] ECR I-4661...................................................311 Case C-206/91 Koua Poirrez [1992] ECR I-6685 ...................................................285 Case C-243/91 Noushin Taghavi [1992] ECR I-4401 ............................................304 Case C-275/91 Iacobelli [1993] ECR I-523 ............................................................145 Case C-310/91 Schmid [1993] ECR I-3037............................................................304 Case C-121/92 Zinnecker [1993] ECR I-5023........................................................150 Case C-297/92 Baglieri [1993] ECR I-5211 ...........................................................145 Case C-327/92 Rheinhold & Mahla [1995] ECR I-1223........................................147 Case C-12/93 Drake [1994] ECR I-4337................................................................145 Case 60/93 Aldewereld [1994] ECR I-2991.............................................174, 175, 178 Case C-71/93 Van Poucke [1994] ECR I-1101.........................145, 160, 171, 176, 181 Case C-308/93 Cabanis-Issarte [1996] ECR I-2097...............................................311 Case C-321/93 Imbernon-Martinez [1995] ECR I-2821 .......................................225 Case C-394/93 Alonso-Pérez [1995] ECR I-4101...................................................225 Case C-425/93 Calle Grenzshop [1995] ECR I-269 ................................171, 178, 181 Case C-443/93 Vougioukas [1995] ECR I-4033 .....................................................159 Case C-451/93 Delavant [1995] ECR I-1545 .........................................................306 Case C-454/93 Van Gestel [1995] ECR I-1707 .......................................216, 222, 223 Case C-482/93 Klaus [1995] ECR I-3551...............................................................202 Case C-98/94 Schmidt [1995] ECR I-2559 ............................................................292 Case C-214/94 Boukhalfa [1996] ECR I-2253 .......................................................178

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xxii Table of Cases Case C-227/94 Olivieri-Coenen [1995] ECR I-3301..............................................159 Case C-243/94 Moreno [1996] ECR I-1887 ...........................................................228 Case C-308/94 Naruschawicus [1996] ECR I-207 .................................................222 Case C-340/94 de Jaeck [1997] ECR I-461 .....................................................171, 182 Case C-25/95 Otte [1996] ECR I-3745...........................................................144, 160 Case C-120/95 Decker [1998] ECR I-1831.............................................................153 Case C-131/95 Huijbrechts [1997] ECR I-1409 .............................................171, 222 Case C-170/95 Spataro [1996] ECR I-2921 ...........................................................220 Case C-221/95 Hervein and Hervillier [1997] ECR I-609 .....................................181 Case C-266/95 Merino García [1997] ECR I-3279 ................................................231 Case C-320/95 Alvite [1999] ECR I-951 ................................................................207 Case C-322/95 Iurlalo [1997] ECR I-4881.............................................................202 Case C-20/96 Snares [1997] ECR I-6057 ...............................................................144 Case C-57/96 Meints [1997] ECR I-6689...............................................................147 Case C-85/96 Martinez Sala [1998] ECR I-2691....................................144, 145, 252 Case C-144/96 Cirotti [1997] ECR I-5349 .............................................................292 Case C-158/96 Kohll [1998] ECR I-1931............................................................153-4 Case C-160/96 Molenaar [1998] ECR I-843 ..........................................................147 Case C-194/96 Kulzer [1998] ECR I-895.................................147, 153, 160, 231, 285 Case C-249/96 Grant [1998] ECR I-621 ................................................................282 Case C-275/96 Kuusijärvi [1998] ECR I-3419 ...............................................171, 186 Case C-178/97 Barry Banks and Others [2000] ECR I-2005..........................177, 181 Case C-202/97 Fitzwilliam [2000] ECR I-883 ...............................................171, 176 Case C-360/97 Nijhuis [1999] ECR I-1919............................................................159 Case C-34/98 Commission v France [2000] ECR I-995..........................................174 Case C-65/98 Eyüp [2000] ECR I-4747 .................................................................282 Case C-169/98 Commission v France [2000] ECR I-1049......................................174 Case C-368/98 Vanbraekel [2000] ECR I-5363......................................................153 Case C-374/98 Commission v France [2001] ECR I-10799 ............................183, 190 Case C-444/98 de Laat [2001] ECR I-2229............................................................222 Case C-33/99 Fahmi [2001] ECR I-2415 ...............................................................247 Case C-43/99 Leclere and Deaconescu [2001] ECR I-4265 ....................................215 Case C-85/99 Offermanns [2001] ECR I-2261 ......................................................144 Case C-135/99 Elsen [2000] ECR I-10409......................................................189, 204 Case C-157/99 Smits and Peerbooms [2001] ECR I-5473......................................154 Case C-215/99 Jauch [2001] ECR I-1901...............................................................147 Case C-255/99 Humer [2002] ECR I-1205 ............................................................248 Case C-385/99 Müller-Fauré [2003] ECR I-4509 ..................................................154 Case C-413/99 Baumbast and R [2002] ECR I-7091 .............................................297 Case C-28/00 Kauer [2002] ECR I-1343................................................................202 Case C-189/00 Ruhr [2001] ECR I-8225 ...............................................................304 Case C-212/00 Stallone [2001] ECR I-7625...........................................................274 Case C-326/00 Ioannidis [2003] ECR I-1703 ........................................................218 Case C-333/00 Maaheimo [2002] ECR I-10087 ....................................................255

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Table of Cases xxiii Case C-117/01 KB v National Health Service Pensions Agency [2004] ECR I-00541 .......................................................................................................282 Case C-156/01 van der Duin [2003] ECR I-10087.................................................218 C-153/03 Weide [2005] ECR I-06017 ....................................................................192 Case C-227/03 Pommeren-Bourgondiën [2005] ECR I-06101 ..............................183 Case C-286/03 Hosse [2006] ECR I-1771 ..............................................................146 C-543/03 Dodl and Oberhollenzer [2005] ECR I-05049 ................................191, 233 Case C-249/04 Allard [ 2005] ECR I-04535...........................................................175 C-493/04 Piatkowski [2006] ECR I-2369 .......................................................171, 176 Joined Cases Joined cases 41/79, 121/79 and 796/79 Testa, Maggio and Vitale [1980] ECR 1979 ....................................................................................................220, 221 Joined cases 379, 380, 381/85 and 93/86 Giletti, Giardini, Tampan and Severini [1987] ECR 955......................................................................145, 214 Joined cases 82/86 and 103/86 Laborero and Sabato [1987] ECR 3401.............................................................................................144, 148, 159 Joined cases C-245/94 and C-312/94 Hoever and Zachow [1996] ECR I-4895 .................................................................................................144, 317 Joined cases C-4/95 and C-5/95 Stöber and Pereira [1997] ECR I-511 .................231 Joined cases C-88/95, C-102/95 and C-103/95 Losada, Balado and Paredes [1997] ECR I-869........................................................144, 145, 201-2, 207 Joined cases C-95/99 to C-98/99 and C-180/99 Khalil, Chaaban, Osseili, Nasser and Addou [2001] ECR I-7413 ...............................................................152 Joined cases C-122/99 and C-125/99 D and Kingdom of Sweden [2001] ECR I-4319 .................................................................................................282, 299 Joined cases C-393/99 and C-394/99, Hervein and Hervillier, Lorthiois and Comtexbel [2002] ECR I-2829 ...........................................................................171 Joined cases C-502/01 and C-31/02 Gaumain-Cerri and Barth [2004] ECR I-06483 .......................................................................................................147

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Introduction I. BACKGROUND

Free movement of labour was recognised as essential in the discussions for closer economic co-operation among the European states and was established as one of the fundamental principles of EEC law. One of the most important conditions for achieving the objective of the free movement of workers was considered to be the co-ordination of the national social security systems of the Member States. Thus, the social security law of co-ordination of the European Community is as old as the European Community itself. The first co-ordination regulations, namely Reg 3/58 and the implementing Reg 4/58, based on Art 51 of the EC Treaty,1 were among the first legislative measures of the EEC. Free movement of labour has been a major objective of the European Community ever since. The right to free movement was gradually expanded to all nationals of the Member States. The transition of the European Community into the European Union meant that the right was further strengthened, so that nowadays it constitutes an important component of the concept of citizenship of the Union.2 At the same time, the view regarding co-ordination of social security has also changed. On the one hand, it has always been and still is considered to be a 1

Art 42 after the Amsterdam Treaty. In this book, articles of the EC Treaty are referred to as numbered after the Amsterdam Treaty. When necessary, the old numbering is used. 2 For a short account of the development of the European Economic Community (EEC) into the European Union of today, see, eg D Chalmers, European Union Law—Volume I, (Dartmouth, Ashgate, 1998). Considerable confusion has been created in the public mind as to the distinction between the concepts ‘European Community’ and ‘European Union’, as arising from the Treaty on European Union (TEU). This Treaty was signed in Maastricht on 7 February 1992 and came into force on 1 November 1993. According to it, the European Union is based upon three ‘pillars’. The European Economic Community (EEC), simply known as the European Community (EC), is one of them. European Community law (EC law) is created and operates under the authority of the EC Treaty. Many legal authors continue to use the term ‘EC law’ for law enacted under the EC Treaty; see eg E Ellis et al, Public law of the European Community (London, Sweet & Maxwell, 1995), preface; A Arnull and D Wyatt, Wyatt & Dashwood’s European Union Law (London, Sweet and Maxwell, 2000), 59. Others, however, prefer the term ‘EU law’; see eg P Craig and G de Búrca, EU Law. Text, Cases and Materials (Oxford, Oxford University Press, 2003). The social security law of co-ordination is based on the EC Treaty and is consequently part of EC law. In this book, the terms ‘EC law’, ‘European Community law’ and simply ‘Community law’ are used interchangeably. The terms ‘European Community’ and ‘Community’ are used more frequently than ‘European Union’ and ‘Union’. By the term ‘the Treaty’ is understood the EC Treaty unless the context clearly indicates otherwise.

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2 Introduction necessary precondition for achieving the objective of free movement of labour.3 On the other hand, it is increasingly viewed as a part of the developing social dimension of the Union, as a social right in itself.4 These developments have constituted major challenges to the social security law of co-ordination and its main legislative instrument, Reg 1408/71.5 Regulations 1408/716 and 574/727 replaced the first social security regulations, namely Regs 3/58 and 4/58 respectively, and they are still in force with numerous amendments, although a new regulation has recently been adopted. At the same time, the very institution of social security has been subject to challenges and changes. The tremendous changes that have occurred in all major areas of public and private life have exerted severe pressure on national systems. Discussions about the possibilities, limits and future perspectives of social security have been intense and are still being conducted both at the political and the academic levels. Measures have been adopted at the level of the national Member States to adapt their systems to the new realities. At the same time, the entire area of social security has also attracted major interest at the European Union level within the framework of the development of a social dimension. The main aims of Union action within this field have been to promote the adaptation of the national systems to the new conditions, as well as to promote their convergence and harmonisation within the framework of the European Union. Some issues of major concern within this context have been the viability of pension systems, the adaptation of the systems to conditions of persistent unemployment and to changed family conditions, as well as the dependency of elderly people. All these issues have resulted in action at both the national and the Union levels. Thus, apart from the changed context of Art 42 of the Treaty, the developments concerning national social security systems have represented a further challenge for the co-ordination system established at the Community level. Against the backdrop of all these developments, discussions regarding the coordination system have revolved around two key words: the simplification and modernisation of Reg 1408/71. Ever since the co-ordination regulations came into force, they have repeatedly been subject to amendment, and a rich body of case law has developed. The accession of Member States with social security systems and traditions different from the original states has been a factor that has considerably complicated the overall system of co-ordination. Fundamental principles of coordination, such as the principle of the application of the legislation of the Member State of employment, were called into question. The social security law of co3

Art 42 has been a part of the free movement of workers provisions of the EC Treaty. See below n 17; and ch 1, at 2.2. 5 Council Regulation 1408/71/EEC of 14 June 1971 on the application of social security schemes to employed persons and their families moving within the Community ([1971] OJ L 149/2). Often referred to here in this book as ‘the Regulation’. 6 As amended and updated by Reg 118/97 ([1997] OJ L 28/1). 7 Council Regulation 574/72/EEC of 21 March 1972 fixing the procedure for implementing Regulation (EEC) No 1408/71 on the application of social security schemes to employed persons and their families moving within the Community ([1972] OJ L 74/1) 4

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Background 3 ordination of the European Community as developed under Reg 1408/71 is a complex and voluminous body of legislative provisions and case law decisions, difficult to understand and cope with. Thus, simplification of Reg 1408/71 was seen as necessary if the Regulation was to continue to play the role for which it was enacted. The modernisation of Reg 1408/71 has been the second point of discussion and concern. Several issues and situations have attracted attention in this context. The exclusion of economically inactive people and third country nationals from the personal scope of the Regulation has been one of the more intensely discussed issues. Pre-retirement and posting, situations that emerged as a consequence of the changes in the labour market and/or migration patterns, have also been raised as issues. Other situations that are increasingly attracting interest are, for instance, the situation of frontier workers8 and dependency during old age.9 Some of these issues resulted in amendments to Reg 1408/71.10 Amendments have also been made with the aim of adjusting the Regulation to developments in the national systems and the case law of the European Court of Justice.11 Finally, a new Regulation, Reg 883/04,12 was adopted in response to the demands for simplification and modernisation of the co-ordination system, with the aim of replacing Reg 1408/71. Several issues that were the subject of discussion in recent years, such as pre-retirement, have been included and regulated in this new statute. However, while some situations have attracted major interest within the context of the modernisation of Reg 1408/71, others have escaped attention altogether. Work interruptions due to childcare responsibilities is one such situation; work interruptions due to family-related migration, typically a female phenomenon, is another. Changed family conditions, most notably increasing rates of cohabitation outside marriage, as well as increased rates of divorce, challenge the institution of marriage. The absence of a marriage, either because it has never occurred or because it has been terminated, also has implications in the social security field. Like the work interruption scenarios, this situation has also failed to attract attention within the context of the process of modernising Reg 1408/71 and adopting the new Regulation. This book focuses on the issue of the application of the co-ordination regulations in cases of work interruptions because of childbirth/child-rearing; work interruptions because of migration; and where a marriage does not exist due to changed family conditions. These are all problematic situations, as work interruptions usually cause problems within the social security context, while the assumptions embedded in the systems in terms of family conditions often do not fit the reality. The book aims 8

See F Pennings,‘Editorial’ in (2001) 3 European Journal of Social Security 83. G Igl, ‘Co-ordination and New Forms of Social Protection’ in Swedish National Social Insurance Board and European Commission (eds), 25 Years of Regulation (EEC) No 1408/71 on Social Security for Migrant Workers—A Conference Report (Stockholm, 1997). 10 One of the most important recent developments was the adoption of Reg 859/03 extending the coordination system to third country nationals; see below ch 4, at I, 1.3. 11 Referred to hereafter simply as ‘the Court’. 12 OJ [2004] L 166/1. Often referred to here as ‘the new Regulation’. 9

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4 Introduction to examine whether the co-ordination system at its current stage of development is able to offer any protection to people finding themselves in one or perhaps several of these situations, to examine the limits of this protection, and to identify possible problems and gaps in the system. In order to do that, some concrete questions are posed, as explained below in section II. The current legal situation is somewhat peculiar. Two regulations, Reg 1408/71 and Reg 883/04, are in force but only the former automatically applies. The latter is to apply only after implementing measures have been taken. A proposal for an implementing regulation which will replace Reg 574/72 is currently pending.13 This situation presents particular difficulties for any project attempting to study the current state of the law of co-ordination. One particularly difficult question is the impact of Reg 883/04 with regard to issues where Reg 1408/71 displays gaps. Are the provisions of Reg 883/04 indicative of the current state of the law despite the fact that this Regulation does not yet apply? The book examines the provisions of both regulations with regard to the questions posed in it. Similarities and differences between the two legal instruments are pointed out. There are several good reasons for taking account of both Regulations rather than focusing on only one. First, both Regulations are in force for the time being and the law as it stands demands that attention be paid to both Regulations. Although the new Regulation is to apply in the future, it is not quite certain when exactly this will happen. Second, Reg 1408/71 will remain partially in force even after its replacement by Reg 883/04 with regard to some issues. Third, Reg 1408/71 will certainly continue to play a significant role in our understanding of the entire system of co-ordination for several years to come. It has been the longestlived Regulation within the co-ordination field; important case law has developed under it, and significant issues have become visible and been discussed. By studying, comparing and contrasting the two Regulations, even the inexpert reader will be able to acquire a genuine knowledge of the law of co-ordination and its development over the years, and draw his or her own conclusions. It is also appropriate to emphasise here that there is as great a need to examine how these situations are dealt with in the European Community co-ordination system as there is to conduct the same enquiry at the level of the national systems. The social security protection of a migrant rests on two pillars: the application of a national social security system; and the application of an international social security system of co-ordination—here, the European Community system of coordination. The latter may be as important as the former, since the ability to export a benefit, for instance, can be of the same practical importance for a migrant as the ability to acquire it in the first place under a national system.14 Consequently, it is just as important to be covered by Reg 1408/71 (or Reg 883/04) as it is to be insured under a national system. Thus, as long as these two systems, the national and the 13

See COM (2006) 16 final. The proposed provisions include strengthening co-operation and improving data exchange between social security institutions. 14 See also M Sakslin, ‘Social Security Co-ordination—Adapting to Change’ (2000) 2 European Journal of Social Security 169, 178.

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The Focus and Main Issues in the Book 5 European, continue to exist in parallel, they will be equally important for the social security protection of migrants, and it will be necessary to meet the new challenges on both levels. The concentration of interest at the national level only, as has hitherto generally been the case, will only cause confusion and misguided expectations in those concerned about their social security rights in cases of migration.15 This book has a gender profile. The situations examined within it are not absolutely exclusive to women, particularly in light of social developments blurring traditional stereotypical gender roles, but there is no doubt that these are situations in which women typically are affected. Despite this gender profile, however, genderneutral language is employed throughout the book: words such as ‘people’ and ‘spouses’ are used, where possible, in preference to ‘women’ and ‘wives’. The reason for this is simple: despite the emphasis placed on the gender aspect, the examination undertaken and the conclusions reached should not be taken, as already stated, as exclusively concerning women. The more men and women depart from the stereotypical roles, the greater the number of men who may assume more traditionally female paths and consequently be concerned by the effects of the social security law of co-ordination of the European Community as described in this book.

II. THE FOCUS AND MAIN ISSUES IN THE BOOK

The law of co-ordination covers a large number of issues. Regulation 1408/71 in particular is a long and complicated statute, impossible to examine in its entirety in a work of this scope, and even Reg 883/04 has some complexities. Therefore, certain segments were chosen for examination in order to fulfil the aim of the book: first, the personal scope provisions, and second, the provisions referring to some of the fundamental principles of co-ordination. ‘Fundamental principles of co-ordination’ refers to the non-discrimination of migrant workers on the ground of nationality; the application of the legislation of only one Member State accompanied and complemented by the lex loci laboris and the lex loci domicilii principles; the aggregation of qualification periods completed in different Member States for the purpose of acquiring entitlement to social security benefits; and the exportability of acquired benefits.16 Some other principles, such as the principle against overlapping benefits and pro rata-isation of benefits are considered as supplementary.17

15 See also Y Jorens and B Schulte,‘The Implementation of Regulation 1408/71 in the Member States of the European Union’ (2001) 3 European Journal of Social Security 237, 239. 16 D Pieters, ‘Will “1992” lead to the Co-ordination and Harmonization of Social Security?’ in D Pieters (ed), Social Security in Europe: Miscellanea of the Erasmus Programme of Studies Relating to Social Security in the European Communities (Brussels, Bruylant and Maklu Uitgevers, 1991) 177–90, 177; N Catala and R Bonnet, Droit social européen (Paris, Éditions Litec, 1991) 265 et seq; F Pennings, Introduction to European Social Security Law (The Hague, Kluwer, 2001) 8 et seq. 17 R Nielsen and E Szysczsak, The Social Dimension of the European Union (Copenhagen, Handelshöjskolens Forlag, Copenhagen, 1997) 130–1.

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6 Introduction The book focuses on three of the fundamental principles, namely the principle of the application of a single Member State’s laws and the accompanying principle of the application of the Member State of employment (the lex loci laboris principle); the aggregation principle; and the exportability principle. The principle of nondiscrimination is not examined because the importance of that principle extends well beyond the boundaries of the social security co-ordination system. In contrast, particular attention is given to a supplementary principle, namely the principle against the overlapping of benefits. The aggregation and exportability principles are examined in relation to four of the social security branches covered by Reg 1408/71, namely maternity, old age, unemployment and family benefits. The nonoverlapping principle is examined only in relation to family benefits. The most significant concrete questions posed in the book and to which the analysis intends to give an answer are the following: — Do the personal scope provisions of the two co-ordination regulations currently in force apply to people whose economic activity has been interrupted due to childbirth/child-rearing or migration? Do the provisions of these regulations concerning the fundamental co-ordination principles, in particular the principles of single applicable legislation and lex loci laboris, aggregation, exportability, and to some extent even the non-overlapping principle, apply to the same categories of people? — Do the personal scope provisions of the co-ordination regulations apply to the unmarried or registered partner of a migrant worker or to a person whose marriage to a migrant worker has been terminated? Do the provisions of these regulations concerning fundamental co-ordination principles, in particular the principles of single applicable legislation and lex loci laboris, aggregation, exportability, and to some extent even the non-overlapping principle, apply to the same categories of people? The first set of questions addresses social security based on economic activity. Pursuit of an economic activity is traditionally the ground upon which social security rights are based. The very concept of social security emerged out of the need to protect workers’ incomes, and alternatively to provide a minimum level of protection when no income could be acquired on the basis of economic activity. The first set of questions intends to investigate the extent to which the coordination regulations live up to this objective. Do they manage to safeguard income, that is to say social security benefits, through the technique and principles of co-ordination, for (often female) migrant workers whose economic activity has been interrupted because of childbirth/child-rearing or migration? The second set of questions addresses social security based on marriage. Social security systems were developed at a time when the pursuit of an economic activity by women was not encouraged or supported by social values and the social organisation. Social security was thus conceived as based on marriage for women as their income and security was generally safeguarded through marriage. In recent decades, the economic significance of marriage as a source of income and security

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The Structure of the Book 7 for women has diminished as a result of the almost revolutionary changes in society. In addition, the significance of the very institution of marriage is in decline. New institutions of cohabitation have appeared, such as cohabitation outside marriage and registered partnership between partners of the same sex. At the same time, the increasing divorce rates pose further challenges to the institution of marriage. When marriage as an institution is in decline, social security rights based on marriage are jeopardised. The discussion today is whether marriage (and furthermore whether this includes only heterosexual formal marriage or other forms of cohabitation) must continue to play a role as a basis for social security rights. The issue of the social security protection of spouses after divorce is particularly relevant in this context. Different national systems have adapted to the new social conditions to different degrees. The second set of questions in this book thus intends to investigate whether and to what extent the protection offered by Reg 1408/71 to the formal spouse of the migrant worker is available to a cohabiting partner, a registered partner and, in particular, a former spouse of the migrant worker. Addressing social security on both bases was imperative since Reg 1408/71 (as well as Reg 883/04) itself addresses social security on these two bases. In addition, social security protection in general for women is nowadays grounded in both. The significance of the pursuit of an economic activity as a basis for social security has grown, with the trend being towards establishing it as the sole basis of social security rights (completed by the basis of residence, as discussed in the pertinent chapters). In contrast, the significance of marriage is lessening—yet it is questionable whether marriage can be completely ignored. Apart from the fact that the institution of marriage is still strong in several Member States, research shows that women invest a considerable proportion of their lives in their personal relationships. There are indications that migrant women invest even more in this area. The question raised by many, therefore, is whether this basis should be extended so as to include other forms of cohabitation as well as safeguard social security rights even after divorce.

III. THE STRUCTURE OF THE BOOK

The book is divided into seven chapters. The first three chapters are general, introductory chapters while chapters four to seven concern the main questions posed. The first chapter is devoted to a general discussion of national and international social security. The main topics of the chapter refer to the basic concepts used in the social security context, the emergence of national and international social security, and the current problems and perspectives of social security. While the determination of the personal scope of national social security systems is grounded in the pursuit of an economic activity on the part of the person concerned or in residence, the personal scope of international systems of co-ordination is determined solely on the ground of economic activity. Under the influence of Member States with residence-based systems, the European Union’s social security law of co-ordination

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8 Introduction has been moving towards recognising social security rights based on residence, which is not so usual at the international level of social security. The discussion regarding the current problems and perspectives of social security at the national level, as well as at the trans-national level of the co-ordination system, aims at enabling a comparison to be drawn between the developments at these two levels. In particular, the discussion in chapter one focuses on highlighting the areas and issues that have not received proper attention at the latter level and constitute therefore the point of departure for this book. Chapter two examines social security from a gender perspective, placing an emphasis on the gender aspect of the book and further developing the discussion regarding the current problems of social security raised in chapter one, as it quickly becomes obvious that many of the current problems of social security have a gendered character. The topics discussed are: first, the relationship of women to social security in a historical context. Their situation under both employmentbased and residence-based systems is examined, while special attention is paid to the role of feminist theories and demographic concerns in the development of social security. Second, the current relationship between women and social security in the different systems is examined. The differences among the national systems of the Member States are presented with the help of some gender typologies of welfare states. Attention is then turned to international social security. While the protection of women under national systems has been grounded on economic activity, marriage and residence, their protection under co-ordination systems has mainly been grounded on two criteria, namely economic activity and marriage. Finally, the gender aspects of the current problems and challenges of social security are enhanced as it is shown that many of theses problems are precisely and inherently gender problems. The two first chapters together aim to achieve several objectives: first, to lay down the context of the co-ordination regulations by describing certain central concepts and the historical origins of social security at the national and international levels. This will hopefully contribute to a better understanding of the role, functions and problems of the regulations. Second, they facilitate anticipating in general the situations a migrant person may find him or herself in in each Member State should the co-ordination system fail to protect him or her. Findings from other scientific disciplines, in particular sociological, socio-historical and feminist research, have been used in order to achieve these objectives. Finally, the first two chapters mark the point of departure of the book by describing the discussions and the progress made with regard to the modernisation of Reg 1408/71. In chapter three, a question is posed: are the situations on which the book focuses of practical importance for the social security protection of (mainly) women? Is there a need to examine how the co-ordination system works in cases of work interruption because of childbirth/child-rearing or migration? Do migrant women interrupt their work patterns for these reasons? Is there a need to examine whether Reg 1408/71, and particularly Reg 883/04, have been adapted to changed family conditions? Is the demography of migrant women similar to the demography of

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The Structure of the Book 9 women who have not migrated? The focus here is on the phenomenon of migration, in particular female migration, discussing its complex and changing nature and seeking answers to these questions with the help of migration research findings. The Community right of free movement is also discussed here. Particular emphasis is placed on the issue of the impact of migration on the professional and familial status of women within the framework of the European Union. The findings show that migrant women, often economically active women, appear to be more inclined to work interruption because of childbirth/child-rearing than local women. They also show that migrant women run a risk of work interruption because of the very fact of migration, a risk that is not shared by local women. In addition, there are indications that their marital status may be affected by a migration decision, and that the stability of marriage may be more gravely threatened because of the fact of migration. All of these findings imply that both economic activity and marriage may not function very well as certain bases of social security for migrant women. Therefore, there seems to be a significant need to examine how the co-ordination system works in these situations that very likely occur within the framework of female migration. The first three chapters aim to give as comprehensive a picture as possible of the complex context of the Community co-ordination system of social security and the pertinent regulations, a context that involves not only labour market and family structures, but also migration flows.Apart from changing labour market and family conditions, migration patterns are also changing, thus adding a further dimension to the pressures exerted upon the co-ordination system. The main questions of the book are examined in chapters four to seven. Chapters four and five concern the first set of questions, while chapters six and seven concern the second set of questions. More particularly, chapter four focuses on work interruption because of childbirth/child-rearing or migration, examining first whether the personal scope provisions of the co-ordination regulations in force apply to people interrupting work for these two reasons. The personal scope provisions are included in Title I of both regulations. The structure of the pertinent section is as follows: first, the current state of the law concerning the personal scope of Reg 1408/71 as well as Reg 883/04 is analysed. Second, the state of the law is assessed from the perspective of the categories of people whose economic activity has been interrupted because of childbirth/child-rearing or migration, and the question of whether the personal scope provisions apply to them is answered. The second question examined in chapter four is whether the choice of law provisions, including some fundamental principles of co-ordination, namely the principle of application of the legislation of a single Member State and the lex loci laboris principle, apply to people interrupting work because of childbirth/childrearing or migration. The choice of law provisions are included in Title II of the regulations. The same technique is used with regard to this question: first, the content of the provisions and principles of Title II in both regulations is briefly outlined. Second, the issue of whether these provisions and principles apply to economically inactive people and those interrupting work in general is analysed.

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10 Introduction Finally, the state of the law is assessed from the perspective of people interrupting work because of childbirth/child-rearing or migration—in particular, the question as to the application of the provisions of Title II of Reg 1408/71 as well as Reg 883/04 to such people is answered, and the differences between the two regulations are highlighted. Chapter five also focuses on work interruption because of childbirth/childrearing or migration. The concrete question posed there concerns the application of the provisions of the co-ordination regulations concerning the principles of aggregation of qualification periods, exportability of benefits and non-overlapping of benefits paid to people interrupting work because of childbirth/child-rearing or migration. In Reg 1408/71, most of these provisions are contained in Title III, including specific provisions regarding certain specific benefits, and therefore the chapter concentrates mainly on this Title of the Regulation, while Reg 883/04 contains general provisions in Title I. Through the same technique used in chapter 4, ie a brief outline of the content of the principle, analysis of the issue of application of the pertinent provisions as to economically inactive people in general and a final assessment of the state of the law from the perspective of the categories of people at issue, answers are given to the concrete questions posed in the chapter with regard to each of the principles examined in the book. Chapter six focuses on changed family conditions. The concrete question is whether the personal scope provisions of the co-ordination regulations in force, as included in Title I, apply to people related to a Community worker through a relationship other than formal marriage, namely cohabitants and registered partners. Particular attention is paid to the question whether these provisions apply to people no longer related to the Community worker, ie separated or divorced spouses. The chapter begins with an analysis of the term ‘member of the family’, focusing on the national laws of the Member States and on the developments of Community law in other related areas, as there is little relevant material in the area of co-ordination law. At the end of the chapter, a question is posed: does the analysis enable conclusions to be drawn with any degree of certainty as to the application of the personal scope provisions of the regulations to unmarried and registered partners as well as to former spouses? The answer suggests that there is a considerable gap in Community law, in particular with regard to separated and divorced spouses. Chapter seven also focuses on changed family conditions. The concrete question here is whether the provisions concerning the principles of aggregation, exportability and non-overlapping apply to unmarried and registered partners as well as to former spouses. The content of the principles at issue is not discussed in chapter seven since it is considered in chapter five. Chapter seven concentrates on the question whether the pertinent provisions apply to family members in the first place. There have been problems concerning such application based on the categorisation of the nature of the benefits as personal or derived. After establishing that a certain provision is applicable to family members in the first place, it is asked whether we can draw any conclusions concerning the application of the same provision to unmarried and registered partners and to former spouses.

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Delimitations and the Sources of the Book 11

IV. DELIMITATIONS AND THE SOURCES OF THE BOOK

The co-ordination of social security, as stated above, is considered to be a necessary precondition for the accomplishment of the free movement of labour. Article 42 formed, and still forms, part of the free movement of workers provisions of the EC Treaty. In the academic literature, the rules concerning the co-ordination of social security have traditionally been studied in relation to the free movement of workers provisions, and not in relation to social policy.18 More recently, however, the social character of Art 42 and the co-ordination system, as well as the social character of the free movement of labour provisions based on Art 39 of the EC Treaty,19 has been strengthened in pace with the development of the social dimension of the Union. Free movement of labour and the coordination of social security are increasingly discussed in the legal literature, and publications concerning the social policy or the social dimension of the Union can increasingly be found;20 furthermore, the nature of these two rights as predominantly economic or social is the subject of much discussion.21 Verschueren expresses the view that Reg 1408/71 has also become an instrument of social policy, implementing one of the basic objectives of the Community, ie the promotion of a high level of social protection according to Art 2 of the EC Treaty, relevant not only when the exercise of the right to free movement is at stake.22 Pieters suggests that Art 42 be moved to that part of the Treaty concerning Social Policy.23 Nevertheless, that which is usually called the social law of the European Community is associated primarily with the Social Policy provisions of Part III, Title III that were initially included in the EEC Treaty, and with the measures and actions enacted and taken on the basis of these provisions. This book does not cover that part of Community law. Neither does the book touch upon the body of law that 18 See eg S Weatherill and P Beaumont, EU Law (Harmondsworth, Penguin, 1999); D Lasok, Law and Institutions of the European Union (London, Butterworths, 1994); PJG Kapteyn and P Verloren Van Themaat, Introduction to the Law of the European Communities (The Hague, Kluwer, 1990). 19 Art 48 before the Amsterdam Treaty. 20 See eg Nielsen and Szysczsak, above n 17. See also European Commission, Internal Market. Current Status 1 July 1994. Community Social Policy (Luxembourg, Office for Official Publications of the European Communities, 1994), where the co-ordination of social security is counted as one of the areas covered by the Community’s social policy. 21 Discussing free movement within the framework of the social policy and social law of the Community, Ward emphasises that free movement is a social right in one sense but it is essentially an ‘economically designed social right’ primarily reserved for the economically active: see I Ward, A Critical Introduction to European Law (London, Butterworths, 1996) 147. Steiner and Woods emphasise the dual imperatives, economic and social, of the free movement provisions: see J Steiner and L Woods, Textbook on EC Law (London, Blackstone Press, 2000) 291. 22 H Verschueren, ‘The Commission’s Proposal to Extend Regulation (EEC) No 1408/71 to Third Country Nationals’ in Y Jorens et al (eds), European Social Security Law and Third Country Nationals (Antwerp, Max-Planck Institut 1998), cited in S Roberts, ‘ “Our View Has Not Changed”: The UK’s Response to the Proposal to Extend the Co-ordination of Social Security to Third Country Nationals’ (2000) 2 European Journal of Social Security 189, 195. 23 D Pieters,‘Towards a Radical Simplification of Social Security Co-ordination’ in Swedish National Social Insurance Board and European Commission (eds), above n 9, 172.

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12 Introduction developed around Art 39 of the Treaty and the different legislative acts and measures concerning free movement.24 Only in one case, when the definition of the concept ‘member of the family’ is discussed, is reference made to case law related to Reg 1612/68 as it concerns the free movement of workers. The book does not focus on the part of Community law that is often called the ‘equality law’ or ‘gender law’ of the European Community. The term usually refers to the body of Community law developed around Art 14125 and the Equal Pay for Equal Work Principle, as well as the Equal Treatment Principle expressed in a number of Council Directives.26 In particular, no attention is paid here to Dir 79/7,27 which stipulates equality of treatment in the social security field, and which is considered to be part of the equality law and social law of the Community. That Directive belongs to the Community law of harmonisation of social security and thus falls outside the scope of this book.28 Finally, within the area of co-ordination law, the book focuses almost exclusively on Reg 1408/71 (and Reg 883/04), leaving the implementing Reg 574/72 largely outside the scope of investigation. The latter comes into the scope of examination on a very limited scale, only when it is absolutely necessary in order to clarify the current state of the law. This is the case with regard to the non-overlapping principle. The sources used in this book are traditional sources of Community law, namely statutes, case law and the academic literature.29 The case law has been a source of major importance, as the law-making role of the Court of Justice30 is obvious with regard to most of the issues examined in the book.31 Considerable space is given to the national laws of the Member States, in particular in chapters five and six. The 24 For an analytical discussion of the right to free movement (excluding social security) see J Handoll, Free Movement of Persons in the European Union (Chichester, Wiley, 1995). 25 Art 119 before the Amsterdam Treaty. 26 There are a considerable number of legal works referring to this part of Community law. See eg S Preschal et al, Gender Discrimination Law of the European Community (Aldershot, Dartmouth, 1990); E Ellis, European Community Sex Equality Law (Oxford, Clarendon Press, 1991). There are also a number of publications by the European Commission in this area: see eg European Commission, Equal Opportunities for Women and Men in the European Union 1996 (Luxembourg, Employment and Social Affairs–Equal Opportunities, Office for Official Publications of the European Communities, 1997). 27 [1979] OJ L 6/24. 28 See Pennings, above n 16. 29 For an extensive discussion of the sources of Community law, see K Lenaerts et al (eds), Constitutional Law of the European Union (London, Sweet & Maxwell, 1999); P Kent, Law of the European Union (London, Longman, 2001); GC Rodriguez Iglesias, ‘Reflections on the General Principles of Community Law’ in A Dashwood and I Ward, The Cambridge Yearbook of European Legal Studies (Oxford, Hart Publishing, 1999) 1–16. See also D Lasok, Law and Institutions of the European Union (London, Butterworths, 1994). As to the nature of the Community legal order, see Arnull and Wyatt, above n 2. 30 As to the law-making and gap-filling role of the Court, see P Mengozzi, European Community Law from Common Market to European Union (trans Patrick de Duca) (London, Graham and Trotman/ Martinus Nijhoff, 1992); R Dehousse, The European Court of Justice (London, Macmillan, 1993) ch 3 in particular; Weatherill and Beaumont, above n 18, 193 et seq. 31 The Court has always played an important role in social security. Already Reg 3/58 had left many problems open and gave rise to a considerable body of litigation in the Court; see K Lipstein, The Law of the European Economic Community (London, Butterworths, 1974) 94.

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Delimitations and the Sources of the Book 13 primary source used for national laws is the MISSOC database,32 but academic literature and to some extent even the judgments themselves or Opinions of the Advocate General have been used to that end.33 Attention is also occasionally paid to the decisions of the Administrative Commission.34 In contrast, the general principles of law have not been used.35 A discussion regarding the impact of various principles on the law of co-ordination,such as the principle of non-discrimination on grounds of nationality, equal treatment of men and women, free movement and other fundamental principles, would undoubtedly be an interesting issue; but such a discussion has not been possible within the confines of this book, for reasons of time and space. The main aim of the book, as already stated, is to chart the current state of Community law with regard to the questions posed, and to highlight and identify any deficiencies and gaps. One difficulty has been that the provisions examined do not explicitly refer to the categories of people examined in the book, namely people interrupting work because of childbirth/child-rearing or migration, unmarried or registered partners and former spouses. The case law has therefore been important, although case law specifically concerning these particular categories of people is often limited. Where such case law exists, it is examined first hand. Where there is an absence of any specific case law, attention is paid to the more general case law. Efforts have been made to structure each of the substantive chapters (chapters four to seven) in a similar manner, although the materials available concerning the particular topics of each chapter are not of the same quantity and therefore some points are more substantial in some chapters than in others. For example, the available material concerning the issues raised in chapters six and seven, in relation to the criterion of marriage, was considerably thinner on the ground than the material used in chapters four and five. Nevertheless, each of chapters four to seven 32 MISSOC is an information system created at the suggestion of the European Commission, Directorate General V, to provide brief, up-to-date and comparable information for persons employed in various services of the Commission, all persons and institutions interested in the development of social protection, and social protection organisations. MISSOC consists of representatives of the Ministries and authorities responsible for social protection in the Member States, who work in close and regular co-operation with each other to collect information and prepare it for annual publication. The data is presented in the form of comparative tables published annually in three languages (English, French, German). Tables III–XI deal with basic benefits to cover the risks listed in ILO Convention No 102. Since 1992 the existing regulations on the guaranteed minimum level of resources are given in Table XII. The MISSOC home page was launched at the beginning of 1999 to provide reliable and rapid access to information: http://europa.eu.int/comm/employment_social/missoc2000/index_en.htm. The database is updated to reflect the current situation on 1 January each year, with a further update in autumn to reflect the situation on 1 July of each year. The printed edition continues to appear annually, describing the situation as at 1 January each year. 33 The Advocate General often undertakes comparative analyses of the national laws: see NL Brown et al, The Court of Justice of the European Communities (London, Sweet & Maxwell, 1994). 34 Decisions of the Administrative Commission are considered to be sources of law within the context of the social security law of co-ordination; see T Erhag, Fri rörlighet och finansiering av social trygghet (Stockholm, Santérus förlag, 2002) 16. 35 For an extensive account as to Community principles of law, see J Usher, General Principles of EC Law (London and New York, Longman, 1998); T Tridimas, The General Principles of EC Law (Oxford, Oxford University Press, 1999); U Bernitz et al (eds), (The Hague, Kluwer Law International, 2000).

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14 Introduction is built upon the same structure. First, the content of the provisions under examination is outlined as briefly as possible. This outline is intended to give the reader a general understanding of the issues in question. Second, it is asked whether these provisions apply to people interrupting work or to the family members of a person covered by Reg 1408/71 and Reg 883/04. Third, an assessment is made in terms of whether the analysis shows that the provisions under examination apply to the categories of people at issue, namely people interrupting work for childbirth/ childrearing or migration in chapters four and five, and unmarried or registered partners as well as former spouses in chapters six and seven. The examination always starts with Reg 1408/71, and is completed with Regulation 883/04. Chapters one to three do not follow this construction, as both the material used and their aim is different from the substantive chapters. The material used there is taken from disciplines other than strictly legal, and hopefully has been understood and used in the correct way. This book is based on a doctoral thesis publicly defended at the University of Stockholm in May 2004.

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1 Social Security in General INTRODUCTION

This chapter presents a general overview of the institution of social security at both the national and the international levels. Beginning with social security at the national level, the presentation focuses on discussing some central and basic concepts, the historical emergence and development of social security, and the differences between the social security systems of the Member States of the Union. Attention is paid, subsequently, to the current problems and perspectives of social security, while a few words are said about the role of the European Union in tackling these problems. Although social security as an institution was born and developed within the borders of national states, the need for social protection went beyond national borders. The national character and the territorial limitations of the social security schemes were problematic in the international context as they hindered the satisfactory protection of people moving between different countries. Therefore, there emerged a need to co-ordinate the national systems. International legal instruments in the form of international agreements and conventions appeared in order to provide those moving beyond national borders with social security. These agreements and conventions constitute the body of international social security law. Regulation 1408/71—as well as Reg 883/04—is an instrument of transnational co-operation in the social security field, albeit in the context of a Union, and it is based upon principles developed within the framework of international social security law. This international law of co-ordination is presented briefly in this chapter with special emphasis on the social security law of co-ordination of the European Community. The presentation aims, on the one hand, to describe the grounds upon which social security protection has been based both nationally and internationally, and, on the other hand, to describe the new challenges faced on both levels and the progress hitherto made to adapt the systems to the new challenges. The former provides the grounds upon which the examination of the social security of coordination is based in this book, and the latter helps to place Reg 1408/71 and this book in context. Inevitably, it must be a short description. It is hoped, however, that the main elements that give a fair picture of the institution and the current state of development of social security have been satisfactorily caught.

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16 Social Security in General

I. SOCIAL SECURITY AT THE NATIONAL LEVEL

The issues discussed in this section refer to the basic concepts and historical evolution of social security, as well as to the current problems and challenges faced by the systems.

1. Basic Concepts What is ‘social security’? What is ‘the welfare state’ and what is ‘social policy’? What do these concepts mean and how do they interrelate with each other? Welfare state generally refers to the protective role assumed by a state, in its latest stages of historical development, towards its citizens. At its inception, a state’s main duty was to protect its territory against external enemies and to protect its citizens against acts of violence committed by fellow citizens. However, the development of the modern state has meant that, in addition to the traditional functions, states have become responsible for other spheres of interest with respect to the individual, such as health care, education, social security, housing, employment, public works, etc. Thus, the notion of the modern welfare state includes all these functions.1 The welfare state can be defined, on the one hand, by the volume and extent of social policy activity, and, on the other, by the permeation of state-determined welfare in all aspects of politics and society.2 It should be noted at this early point that the definitions of the welfare state have been criticised from a feminist perspective for ignoring gender in the academic discourse. This is discussed further elsewhere.3 The welfare state takes a series of actions concerning the above stated areas of individual interest, ie health care, education, economy, employment, etc, within the framework of what is known as the state’s social policy.4 Defining social policy, Parry writes: ‘Social policy is the nature of the interaction between the state and the individual in the spheres of education, social care and protection, and income maintenance. It revolves around the choice of instruments to achieve social end states like happiness, health, security and education.’5 Thus, the mere production of 1 J Van Langendonck,‘Basic Techniques of Social Security’ in D Pieters (ed), Social Security in Europe: Miscellanea of the Erasmus Programme of Studies Relating to Social Security in the European Communities (Brussels, Bruylant and Maklu Uitgevers, 1991), at 23. 2 R Parry, ‘The Social Policy Context of Social Security’ in D Pieters (ed), above n 1, at 50. Although the scientific use of the term ‘welfare state’ has been subject to debate and criticism, the term is nevertheless well established, with many scientific works referring more or less to the definition of the concept and the theoretical and political approaches to it. See eg C Pierson, Beyond the Welfare State? The New Political Economy of Welfare (Cambridge, Polity Press, 1998). For a general survey of the concept of ‘welfare’, see D Macarov, Social Welfare. Structure and Practice (Thousand Oaks CA, Sage Publications, 1995). See also F Ewald, L´État providence (Paris, Bernard Grasset, 1986). 3 The feminist discourse with respect to the welfare state is developed in ch 2. 4 For an overview of the theories concerning society, exploring the links between social theory and social policy, see M Mullard and P Spicker, Social Policy in a Changing Society (London and New York, Routledge, 1998). 5 R Parry, above n 2, at 49.

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Social Security at the National Level 17 outputs such as housing and education, for instance, cannot in themselves be the end of social policy. This only makes sense as a part, and definitely not the most significant part, of the series of measures undertaken by the state in its efforts with respect to the well-being of its citizens. It follows that different states can make different choices or that the same state can try different methods, always striving for the same goal. In a broader definition of social policy, Leibfried and Pierson note that social policies modify market outcomes to facilitate transactions, to correct market failures, and to carry out regional, interclass or intergenerational redistribution. These efforts are produced through a range of mechanisms, including industrial relations policies, education and vocational training, and family policies, in addition to traditional social security.6 Marshall defines social policy as the use of ‘political power to supersede, supplement or modify operations of the economic system in order to achieve results which the economic system would not achieve on its own’.7 Modern social policy, that is to say the modern welfare state, is a European invention.8 It was born as a solution to the problems created by capitalist industrialisation, driven by the class struggle and following in the footsteps of the nation state.9 Other reasons are also considered to have contributed to the evolution of the welfare state, one being European family structures. It has been suggested that the nuclear family was more a precondition than a product of industrialisation as preindustrial Europe was quite unique for its relative predominance of simple family households.10 Social policy has been linked to the nation state. The creation and development of the European Community raised the politically thorny issue of whether, and to what extent, the Community would be the recognised political authority in the social policy field. Despite the fact that the Community assumes extensive action in this field today, the question of Community authority on social matters remains a delicate one.11

6 S Leibfried and P Pierson (eds) European Social Policy. Between Fragmentation and Integration (Washington DC, The Brookings Institution, 1995), at 43. 7 TH Marshall, Social Policy (London, Hutchinson, 1975) cited in Leibfried and Pierson, above n 6, at 3. 8 J Roebroek,‘Social Policy Diversities in Europe’ in D Pieters (ed), above n 1, at 61. 9 The industrial breakthrough together with population growth led to massive population shifts from agriculture to industry and from country to town. While in 1870 only one in six people in western Europe lived in towns of 20,000 or more inhabitants, this figure was one in three by 1910. In the more industrialised countries such as Great Britain, Germany, Belgium and Switzerland, 40% or more of the labour force was working in the secondary section at the eve of the First World War. The emergence of an industrial working class brought about new social problems. People came to be totally dependent on their salaried work and lacked any support in cases of loss of income due to accidents, sickness, invalidity, unemployment, or oldage. In the meantime, the establishment of trade unions was facilitated by the freedom of association, granted in most European countries even prior to 1870, and workers’ parties came about before the turn of the century with the introduction of male suffrage; see P Flora,‘Introduction’ in P Flora (ed), The Western European Welfare States Since World War II, Vol 1 (Berlin, 1986), at XII–XIII. 10 P Flora, above n 9, at XIV. 11 The social policy of the European Community has been the topic of a considerable body of scientific works in all disciplines. See eg L Hantrais, Social Policy in the European Union (London, Macmillan, 1995); S Leibfried and P Pierson, above n 6.

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18 Social Security in General 1.1 The Concept of Social Security Social security is a part of a wider spectrum of social policy in the context of the modern European welfare state. It maintains a central role and has become an important institution in all welfare states; indeed, it forms the core of the welfare state.12 The term ‘social security’ was used for the first time in 1934 by US President Roosevelt when launching his ‘New Deal’, of which the Social Security Act would become a part, and referred to a combination of both economic and social security.13 However, to give a precise definition of social security, one that would fit all countries, is very difficult, if not impossible. Berghman notes that it is ‘virtually impossible’ to give an accurate descriptive definition of social security that fits every country. Even international texts that deal with social security do not employ the same classification of social security schemes.14 Countries differ in their conceptions, practices and traditions of providing protection and security to their citizens, and the boundaries between private and public spheres of responsibility cannot be drawn at the same point in all countries. However, from a legal point of view, social security refers to any scheme enacted by a state which, by employing the techniques of insurance and assistance, aims at providing protection when one of the situations of need, covered by the schemes, occurs. Berghman notes that social security refers to ‘the set of policy instruments that is set up to compensate for the financial consequences of a number of social contingencies’.15 According to the International Labour Organization: [T]he fundamental aim of social security is to give individuals and families the confidence that their level of living and quality of life will not, so far as possible, be greatly eroded by any social or economic eventuality. This involves not merely meeting needs as they arise but also preventing risks from arising in the first place and helping individuals and families to make the best possible adjustment when they are faced with disabilities and disadvantages, which have not been, and could not be, prevented.16

The techniques largely embraced by the state, when it laid the foundations of modern social security systems, were those of insurance and assistance. Both preexisted together with others that have remained outside the modern concept of social security. These two offered the grounds on which social security legislation 12 Other policy fields included in the concept of the welfare state are policies for the improvement of working and living conditions, education and training policies, family policies, policies for older and disabled people, etc. 13 J Berghman,‘Basic Concepts of Social Security’ in D Pieters (ed), above n 1, at 9. 14 Ibid. Sinfield considers that social security might be designated as an ‘essentially neglected concept’; see A Sinfield,‘Managing Social Security for What?’ in D Pieters (ed), Confidence and Changes: Managing Social Protection in the New Millennium, EISS Yearbook 2000 (The Hague, Kluwer Law International, 2001), at 150. 15 J Berghman, above n 13, at 9. 16 ILO, Into the Twenty-first Century: The Development of Social Security (Geneva, International Labour Office, 1984), para 219, cited in A Sinfield, above n 14, at 149.

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Social Security at the National Level 19 was based and developed.17 After the assumption by the state of its protection responsibilities towards its citizens, these techniques are referred to as social insurance and social assistance. They are discussed more thoroughly in the sub-sections below. Briefly, social security is a comprehensive term containing two components, namely social insurance and social assistance. In accordance with the influence of each component on the system, social security systems are basically distinguished into two categories: insurance-based systems and assistance-based systems.18 An intense debate has occurred in recent years, especially in light of economic crises and the gradual dismantling of many social security systems, as to the adequacy of the current concept of social security. Other forms and techniques of security, such as private savings and family interdependence, previously considered as belonging to an earlier stage of the economic and social development of modern states and given no place in the modern concept of social security, are coming into vogue again. Within the framework of a newer approach, social security can be defined as ‘a state of complete protection against the loss of resources’.19 While, however, the search for other techniques is associated with the dismantling of current social security, additional social security is also required. The existing schemes are criticised for the narrowness of their current scope, especially with regard to their adaptability to the new risks that have emerged as a result of changed attitudes in the labour market and in family life. These issues are developed in more detail below.20 a. Social Insurance Social insurance, as stated above, is one of the two main ingredients of the modern institution of social security. It stems from the technique of insurance, used long before the emergence of social security as a modern institution. The idea of insurance is that by paying a premium in advance, a person can insure himself or herself against the economic consequences of the occurrence of a risk. Insurance, as a method of protection against economic risk, emerged in Italy in the late Middle Ages to satisfy the need of merchants, who sent their ships on long risky voyages, to protect themselves against financial ruin that might follow from such an enterprise. For a long time, insurance was confined to business situations and aimed at providing protection in case of loss of goods. People themselves became insurable objects when life insurance through private insurance schemes became possible with the breakthrough of the rationalist ideas of the 18th century, 17

States, when creating modern social security systems, took care to remain true to the traditional structures of protection to which people were accustomed. In most social security systems, the existing structures were maintained, at least at the beginning. This strategy was further reinforced by the fact that the administration personnel of the existing private funds and insurance companies were indispensable for the reform’s success, because they had technical expertise and experience that the state administration lacked; see J Van Langendonck, above n 1, at 24. 18 As to the concept of social security, see also P Watson, Social Security Law of the European Communities (London, Mansell Publishing, 1980), at 1 et seq; N. Harris et al, Social Security Law in Context (Oxford, Oxford University Press, 2000), at 14 et seq. 19 J Berghman, above n 13, at 20. See also J Schell,‘European Social Security Systems’ in D Pieters (ed), above n 1, at 97 and 98. 20 At 4.

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20 Social Security in General and in particular the works of Condorcet undermining the significance of the dogma of divine providence.21 It is interesting to note that private insurance schemes were subject to much abuse: there was an abnormally high mortality rate for insured children, leading to a prohibition on life insurance for children.22 As a reaction to the abuses by commercial insurance companies, a new form of insurance, namely mutual insurance, emerged. Mutual insurance, whose origins lay in the co-operative movement of the 18th and 19th centuries, was based on the idea that the customers of the insurance scheme were at the same time its members. Thus, it was managed in the interests of its members with lower administrative costs and less of a profit requirement. Social insurance was initially based on this form of mutual insurance. However, when the first social security schemes were introduced, this form of insurance was considered to be totally different from private or commercial insurance. The calculation of premiums/contributions was based on global risk instead of individual risk. It was financed not only by the insured person but by other sources as well, such as the employer and the state. In addition, the people affected participated directly in the management of the scheme.23 Although private insurance does not play a primary role in today’s system of protection, it continues to exist alongside social insurance. It has enjoyed something of a revival in the aftermath of cut-downs in social expenditure and the dismantling of the welfare state. At times, it is even imposed by law or collective agreements between employers and employees (eg car insurance, or the obligation of employers to take up group insurance for their employees). Social insurance schemes encompass a certain number of risks, established by national and international law, in particular the ILO Social Security (Minimum Standards) Convention No 102 of 1952.24 These are the risk of sickness, maternity, invalidity, industrial injury, old age and unemployment. Starting a family is also considered to be a social risk. Traditionally, this risk refers to the additional expenses incurred when building a family. When a risk occurs, it is presumed that a situation of need arises. The occurrence of any of the listed risks, whether foreseeable or not, entails an inability to work and, consequently, a loss of income. In some cases, such as building a family and raising children, the materialisation of the risk entails additional expense for the insured. In accordance with their purpose, social security schemes are differentiated from replacement income schemes which aim to provide income maintenance when primary earnings are interrupted, as for instance in the case of unemployment, sickness and old age; and adjustment income schemes which aim to meet exceptional expenditure, as in the case of childbirth or medical care. In another version, based primarily on assistance aspirations, the primary duty of social security is not income maintenance in cases of need, but the provision of a minimum income at subsistence level.25 21

J Van Langendonck, above n 1, at 33. Ibid. Ibid, at 46. 24 Below, at II, 1.2, a. 25 The issue of the distinction of social security as regards different models and the different aspirations embedded in each model is developed below, at 3. 22 23

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Social Security at the National Level 21 Insurance is the predominant form of social security in the Member States of the European Community. Social insurance differs from private insurance, from whose ideas and principles it originally stemmed, in that the schemes are compulsory and individual premiums are not related to individual risk. The very essence of the principle of insurance—the contributory nature of benefits—has become the element of fundamental importance in the context of social insurance. Having paid for and, in a way, having earned his or her benefits, the beneficiary has legitimised his or her receipt and, consequently, has shaken off the stigma of public assistance and charity. It was precisely this aspect of the contributory principle that was decisive for its establishment even in the British social security system, despite the universal and social citizenship aspirations of the Beveridge model.26 Beveridge himself saw the financing of benefits through contributions rather than state funds as essential in the system he proposed. Its importance has always been broadly accepted in countries of the Bismarckian tradition, and in Germany the Constitutional Court has on many occasions recognised the right to contribute social security benefits as a proprietary right.27 Even in the Scandinavian countries, the contributory principle has played an important role. A significant proportion of the social security systems is financed by contributions, although financing based on public funds is more systematic in these countries. Even in these countries, the right to social security benefits is often considered a form of insurance.28 Finally, the legitimation of social allocations through contributions is exactly the factor that provides a strong argument for retaining the contributory principle, even when it has been demonstrated to be ill suited to the needs of today’s poor in contemporary economic circumstances.29 b. Social Assistance Social assistance has its origins in charity. In most countries and cultures, the rich and privileged practise charity towards the poor and nonprivileged, very often viewing it as a part of their religious duty. Historically, aside from individual charity, many organisations and institutions, and predominantly the Church, were active in providing relief for the poor. For a long time, charity was the main source of support for the weakest members of society, when poverty was seen as a natural situation and, indeed, even a punishment from God. The first step towards changing the spontaneous practice of charity from individuals and organisations to institutionalised public assistance was taken in England, with the Poor Relief Act of 1601. Subsequently, the French Revolution solemnly affirmed and spread this ideal throughout Europe. In the French Constitution of 1791, assistance was called as a ‘holy debt’ (dette sacrée) of the nation, and the right to assistance for all citizens was solemnly affirmed in the Declaration of Human Rights and the Rights of Citizens.30 The responsibility of the state in the context of 26 Below, at 2.2, b and 3.2. For an account of the different ways of financing social security benefits, see T Erhag, Fri rörlighet och finansiering av social trygghet (Stockholm, Santérus förlag, 2002). 27 J Van Langendonck, above n 1, at 46. 28 Ibid, at 47 with references. 29 Below, at 4. 30 J Van Langendonck, above n 1, at 26.

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22 Social Security in General protection of its citizens generally took the form of assistance to the poor almost up to the end of the 19th century, when the first insurance-based schemes for restricted groups of workers, mainly low-paid employees in dangerous occupations, made an appearance in Germany. Nowadays, social assistance, which can be traced back to this initial practice of charity, constitutes the other component of the notion of modern social security. Most European states have legislation concerning social assistance.When assistance became part of an institutionalised concept of social security within the framework of the welfare state, it also became a right. Furthermore, the aim of social assistance has become more ambitious, in pace with its development phases. Whilst originally designed to provide a minimum subsistence level, in its current phase of development it aims at enabling everybody to participate in society in a more or less normal way.31 However, despite this institutionalisation and upgrading, social assistance benefits are still considered to be a type of second-class benefit, not fully legitimised for receipt.32 Social assistance is characterised by certain specific features. It is financed by public funds and is based on an individual assessment of need. Means tests play an important role in this context. As assistance grows in importance and use against a background of economic crisis and persistent rates of long-term unemployment, means tests come to play an increasingly central role in the social protection systems of many countries. Many social security benefits, introduced within the framework of policies aimed at combating new forms of social exclusion and misery, depend on an individual assessment of the situation of the person concerned. Furthermore, social assistance used to be based on a nationality requirement, but since the Second World War this requirement has been replaced by a notion of territoriality. This process has taken place gradually through legislative changes and the jurisprudence of the courts.33 Insurance and assistance schemes have converged during their development. Today it is difficult to draw a clear distinction between them. Insurance schemes, for instance, can be financed by public funds, and minimum income benefits can be granted without any means tests. A criterion of distinction between social insurance and social assistance benefits was developed by the Court of Justice of the European Community within the framework of the co-ordination of the social security law of the Community. In accordance with this criterion, the decisive feature of a social security benefit is whether it is conferred upon a ‘legally defined position’ of the beneficiary.34 31

J Van Langendonck, above n 1, at 26. For an account of social assistance in different European States, see I Lodemel and B Schulte,‘Social Assistance—A Part of Social Security or the Poor Law in New Disguise?’, paper presented at the International Conference Social Security: 50 years after Beveridge, University of York, 27–30 September 1992, Vol 2, at 13. 33 G Vonk, ‘Migration, Social Security and the Law: Some European Dilemmas’ (2001) 4 European Journal of Social Security 315, at 320. 34 Below, ch 4 at I, 1.1 a ii. 32

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Social Security at the National Level 23 1.2 Social Risk Social insurance schemes, as stated above, encompass a number of social risks. The term ‘risk’ appeared in France in the 16th century in the context of maritime trade. Under the double influence of the age of enlightenment and the industrial revolution, the individual approach to the notion of risk changed to a social or collective approach. Notable reasons for this change include the ‘declericalisation’ of society, the concentration of the population in industrial centres—rendering the risks more visible, and the development of new ideologies. Beyond the ILO listing,35 many countries have accepted collective responsibility for other various types of damage as linked to wars or natural disasters, as well to crises of overproduction.36 The term ‘risk’ is oriented towards an uncertain event in the future. There is no legal definition of the term ‘social risk’. The international statutes using the term provide an enumeration rather than a definition of the term. Several definitions and descriptions have been put forward, but, according to the prevailing theory in social security law, a risk is a social risk when it is supported by social institutions.37 While the concept of risk is a concept associated with social insurance, need is associated with social assistance. Nevertheless, as Berghman underlines, that which social security as a whole is ultimately dealing with is need: the income need that arises when social accidents such as incapacity to work, unemployment or old age present themselves and generate income losses. Thus, it is income need behind the risk or social risk that is ultimately addressed. The fact that the need for income follows quasi automatically when one of the risks of work incapacity, unemployment and old-age materialises made it possible to address income need, by elaborating insurance schemes that focused on these risks, without any further necessity to verify actual need. Thus, risk-based insurance focuses not on real need but on possible need in the future.38

2. The Emergence and Evolution of Social Security39 Before discussing the emergence and evolution of social security, a few words should be said about the forms of security in the pre-industrial world. 35

Above, at 1.1, a; below, at II, 1.2, a. PJ Hesse, ‘Autour de l’histoire de la notion de risque’ in J Van Langendonck (ed), The New Social Risks, EISS Yearbook 1996 (The Hague, Kluwer Law International, 1997). 37 E Alfandari,‘L´evolution de la notion de risqué social’ in J Van Langendonck (ed), above n 36. 38 J Berghman, ‘The New Social Risks: A Synthetic View’ in J Van Langendonck (ed), above n 36, at 252. 39 The study of the historical and conceptual framework of social security, as well as the distinction between different models of social security, discussed in sections 2 and 3, concern West European countries. The social protection and welfare systems in other European countries, such as the East European countries having recently entered the Union, are not broadly known. Nevertheless, the new Member States as well as candidate countries are taking steps to approach the models of the old Member States by reforming their systems. For an interesting review of the social security systems of the new 36

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24 Social Security in General 2.1 Forms of Security in the Pre-industrial World The instinct to protect against foreseeable and unforeseeable risks in the course of a lifetime has always been strong in human beings. Throughout history man has developed techniques to safeguard himself in particular against economic need. Savings, private insurance, family responsibility, alimony and third-party liability are some of the techniques still used, to varying degrees, to ensure income maintenance in periods of need. In the pre-industrial world, the family was one of the major sources of protection. People in rural areas usually lived in large households, all were involved in production, and the death or incapacity of one member had only a marginal impact on the continued ability of the family to sustain itself. Another source of protection was landlords, who had a paternalistic familial duty towards their workers and were expected to help their labourers in times of misfortune.40 The Church, especially in Catholic countries, traditionally assumed responsibility for the poor, considering easing poverty to be one of its main domains. Even after the advent of social security, the Church was very reluctant to surrender responsibility to the state. This attitude clearly characterised the way in which several systems developed.41 The state was also a source of protection in some countries, such as Great Britain and the Scandinavian countries. In these countries, the state enacted statutes providing for income support to the needy and for the alleviation of poverty. The first statute of this kind, the Poor Relief Act, was introduced in Great Britain in 1601. However, the scope of these laws was generally narrow, the level of benefits low and their receipt was accompanied by social stigma. 2.2 Social Security in the Industrial World Social security is connected with the rise of industrialism in Western Europe. It is generally considered to be a product of economically and socially advanced societies. Member States, mainly with regard to pension and health care systems, see European Commission, Social Protection in the 13 Candidate Countries: A Comparative Analysis (Luxembourg, Office for Official Publications of the European Communities, 2003). 40 The landowner’s paternalistic duty of protection has survived up to the present day in nonindustrialised parts of the world. Esping-Andersen writes that feudal ideals are strongly antagonistic to the commodity status of human labour. He retells the history of an American textile corporation which in the 1970s decided to begin production in Haiti, where wage-costs were extraordinarily low. The firm’s managers, all Americans, decided to attract the island’s best workers by offering a marginally higher wage. On the opening day, the unemployed came in their thousands to offer their services. Yet, after only a few months, the plant was closed down. The reason was simply that the American managers had failed to reckon with feudal welfare arrangements. When a worker’s mother’s house burnt down, or when a child needed medical attention or a brother was getting married, it was the boss’s (in Haiti, workers call him Papa) obligation to help. ‘Where workers are genuinely commodified, the manager is no Papa.’ See G Esping-Andersen, The Three Worlds of Welfare Capitalism (Cambridge, Polity, 1990), at 38. 41 Below, at 3.

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Social Security at the National Level 25 The emergence of modern social security can be traced to Bismarck’s Germany in the late 19th century, and hence Bismarck is regarded as the father of social security. Social insurance was established as a new institution, breaking with the principles of traditional poor relief as previously found in Great Britain and the Scandinavian countries, giving a wider legitimacy to social security, and lifting those affected from the stigmatised status of dependence and assistance. In the period between 1883 and 1889, three schemes were enacted to cover people in paid employment. The very first social security scheme referred to sickness insurance, and was introduced by an Act of 1883. It was soon followed by the 1884 Act on injury insurance and the 1889 Act on old age and invalidity insurances. Other industrialised countries, such as Belgium, the Netherlands and Great Britain, were quick to follow the German example. In subsequent years, social security spread not only to the remaining European countries, but even to Commonwealth countries such as Australia, Canada and South Africa, and to many South American countries. Although industrialisation and democratisation are pointed out as major factors, they are not in themselves sufficient to explain the emergence of social security. They certainly explain how and why the need for social security arose, but they do not explain why the state felt compelled to take action in this area. Neither do they explain why social security emerged, as it did, in Germany and not in Great Britain, where industrialisation took shape first, and which was the leading industrial nation at the time. This issue has been widely discussed in the literature. Several factors have been underlined as contributing to an answer. The role of cultural factors and changes, such as growing self-respect, solidarity and the legitimacy of state interference, has been pointed out as being decisive at the stage of emergence of social security. Great Britain is considered to have lacked the necessary cultural conditions.42 The tradition of social protection of the worker survived more robustly in Germany than in England, as liberalism and the individualistic principles of the unregulated market had not become so deeply entrenched.43 At the same time, the intellectual climate favoured the introduction of social insurance.44 However, above all else, the introduction of social insurance must be attributed to political considerations, ie to ‘the understanding of the importance of the relationship between political stability and the problems of economic insecurity inherent in an industrial society’.45 In other words, the main driving force behind the introduction of social insurance was a concern for maintaining political stability. To put it another way, economic insecurity constituted a threat to existing political structures and institutions. Thus, the primary concern of social security in protecting workers was to protect the state.46 The understanding of this relationship between economic insecurity and political stability came about thanks to Bismarck’s 42

J Berghman, above n 13, at 11. See also R Parry, above n 2, at 50. G Rimlinger,‘The Emergence of Social Insurance: European Experience before 1914’ in PA Köhler and HF Zacher (eds), Beiträge zu Geschichte und aktueller Situation der Sozialversicherung (Berlin, Duncker & Humblot, 1983), at 112. 44 Ibid. 45 Ibid, at 113. 46 Ibid, at 122. 43

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26 Social Security in General political insight and his contribution to social security. He reportedly was not particularly interested in the technical details of social insurance, and had made it clear that for him protection of the worker was not an end in itself.47 He saw social insurance as an instrument of state power, and thus favoured social insurance arrangements that linked the worker as closely as possible to the state.48 Another aspect of his understanding of social security was that certain categories of employees who were particularly useful, such as civil servants, were privileged with advantageous schemes, ultimately aimed at ensuring and strengthening their loyalty to the state. From the outset, social insurance schemes were generally drawn up around a certain number of risks. Although the risks covered by the different national systems were the same, the order in which the schemes were introduced in each country differed. This can be seen as evidence of the impact that different social, cultural and political conditions had. However, as a rule, schemes regarding occupational injuries and diseases were introduced first. Gradually, the differentiation between disabilities caused by industrial accidents, and diseases and disabilities as a consequence of other causes, disappeared. The first schemes were followed by those covering sickness and maternity. Subsequently, schemes providing for old age, invalidity and survivor benefits were introduced. Family allowances followed. Finally, unemployment schemes, in relation to which the greatest doubts were expressed, were adopted.49 It should be noted that, as social insurance was primarily aimed at waged workers, schemes for self-employed people were not developed. Even today, self-employed peoples in general have less coverage than waged employees.50 After the establishment of the first social insurance schemes in Bismarck’s Germany in the late 19th century, social insurance continued to expand throughout the 20th century. More and more risks were covered and more and more population groups were included. After the First World War an express link was established between social insurance and human rights.51 Social insurance experienced tremendous growth from the early 1950s to the mid-1970s. It is quite noticeable that not even the world wars or the economic crisis of the 1930s stood in the way of this expansion. In the years following the Second World War, the concept of social security was established as an institution and as a part of the basic structure of modern states. Two major events dominated the developments in the field of social security during the post-war era. There was a tremendous expansion of social security schemes in all Western European countries, a large number of which today constitute the European Union. On the other hand, there was a shift in focus from 47

Ibid at 113. Ibid. Such arrangements were compulsory participation, minimal worker contribution, direct financing by the government, and centralised administration. 49 J Berghman, above n 13, at 12. 50 See eg European Commission, Social Protection in Europe (Luxembourg, Office for Official Publications of the European Communities, 1995), at 117 et seq. 51 H Zacher, ‘Social Insurance and Human Rights’ in MC Kuo et al (eds), Reform and Perspectives on Social Insurance: Lessons from East and West (The Hague, Kluwer Law International, 2002). 48

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Social Security at the National Level 27 the principle of insurance to the notion of social citizenship. This was mainly achieved with the publication of the Beveridge Report in Great Britain. The elaboration of a social citizenship notion led gradually to a blurring of the traditionally clear-cut difference between insurance and assistance, and to a gradual convergence of national systems, irrespective of their original and main orientation. a. Expansion of Social Security Social security experienced an unprecedented expansion in the years following the Second World War. At the turn of the previous century, 12 countries had accident insurance covering about 20 per cent of the employed population; seven had sickness insurance covering about 17 per cent of the employed; compulsory insurance for old age and invalidity existed only in Germany; while no country had unemployment insurance. In the early 1930s, accident, sickness, invalidity and old age insurance for about half of the labour force on average existed, while around 20 per cent of the labour force were covered by unemployment insurance. By the mid-1970s, over 90 per cent of the labour force were protected by social insurance schemes against old age, invalidity and sickness; over 80 per cent were covered against accident and 60 per cent against unemployment.52 Measured as a proportion of Gross Domestic Product (GDP), social expenditure after the Second World War doubled and even tripled in some countries, such as the Netherlands, Norway and Sweden, reaching a peak in the early 1970s.53 While Germany remained at the top until the mid-1960s, in subsequent years newcomers, such as Sweden and the Netherlands, have taken the lead. Since the Second World War, social security has been recognised as a principle of law. It is set out as a fundamental right in the Constitutions of almost all European countries. Furthermore, the principle is stated in international conventions, such as the Declaration of the International Labour Organization (Declaration of Philadelphia) of 10 May 1944, and the International Convention on Economic, Social and Cultural Rights. It is also confirmed in conventions of the ILO and in the Social Charter of the Council of Europe of 18 December 1961. An important issue is the exact legal force of these constitutional rights. Generally speaking, they do not carry much weight. They emerged as a result of the social security schemes, which developed independently of them, rather than being their starting point.54 After the late economic crisis of the mid-1970s, there was a turning point in the evolution of social security. The late 1970s signified the end of the ‘golden age’ of the European welfare state. A decline in the growth of social security followed as a result of the distortions of the world economy caused by the oil crises, persisting high levels of unemployment, and public deficits.55 The growth of social expenditure slowed down56 in a context that, in the opinion of some, constituted a historic turning point in the history of post-war welfare states.57 52 53 54 55 56 57

P Flora, above n 9, at XXI, XXII. J Roebroek, above n 8, at 64–65. J Schell, above n 19, at 99. P Flora, above n 9, at XXII–XXV. J Roebroek, above n 8, at 66. Ibid, at 68.

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28 Social Security in General b. The Beveridge Report and the Emergence of Social Citizenship The Beveridge Report, published in 1942, was named after the chairman of the Committee on Social Insurance and Allied Services, Sir William Beveridge. The Committee was appointed by the British Government to survey the then existing schemes of social insurance. The work of the Committee was initially intended to be a minor ‘tidying up operation’58 in response to complaints from the trade unions. It ended up reviewing the system and proposing reforms with more far-reaching effects than were ever intended. Trade unions had complained about the bewildering provisions regarding different benefits that had arisen on a separate basis. For instance, there were three different and mutually exclusive benefits for unemployment, three different types of pension, benefits and pensions at different rates, some of which made provision for dependants and some not, while seven different government departments were involved in these complex arrangements. In the midst of a war, it was deemed important for the government to make some concessions to the trade unions.59 Thus, the Beveridge Report was a response to the demands that had been articulated by the labour movement and by the progressive opinion of the time. The Report proposed two major reforms to the concept and systems of social security. The first referred to the scope of beneficiaries of the social security systems. The Report introduced the innovative idea that social security could be stretched to cover everyone, and not just those in regular employment. The second point of reform referred to the objective of social security. Its main objective was traditionally to maintain the worker’s standard of living in periods of need. The Report proposed that social security should aim at reducing poverty and, thus, flat rate benefits at subsistence level should be introduced.60 One of the biggest stumbling blocks in setting up a flat rate subsistence benefit level was the fact that housing costs varied widely. A benefit that is valuable to some families with low rents might be rather less valuable for other families with higher rents.61 The benefits were to be financed by flat rate contributions divided between employers, the insured and the state. Furthermore, the Report proposed health care as a right of all citizens. Active labour market policy was recommended in order to combat unemployment. Finally, unification of the many social security funds and the setting of a national minimum income level were recommended. Propagating a universalistic version of social security, the Beveridge Report became a benchmark in the annals of social security history. It has had a major 58

B Abel-Smith, ‘The Beveridge Report: Its Origins and Outcomes’, paper presented at the York University conference, above n 32, Vol A, at 8. 59 Ibid. 60 Benefits purporting to be at subsistence level presuppose the definition of subsistence and to this end, Beveridge appointed a sub-committee. The standard finally introduced was not very generous. Nothing was allowed for the purchase of beer, tobacco, newspaper and books or for going to the cinema, although there was some margin for ‘insufficient spending’, ibid, at 11. See also JH Veit-Wilson, ‘Condemned to Deprivation? Beveridge’s Responsibility for the Invisibility of Poverty’, paper presented at the York University conference, above n 32, Vol 1, at 45. 61 B Abel-Smith, above n 58, at 11. See also P Baldwin, ‘Beveridge in the Longue Durée’, paper presented at the York University conference, above n 32, Vol 1, at 31. Analogous problems arose with regard to flat rate contributions.

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Social Security at the National Level 29 influence in other countries by setting a much more ambitious goal for social security than had generally been accepted before. Beveridge acquired a reputation as one of the main architects of the ‘social citizenship’62 model of the welfare state. The idea of universality, however, was not absolutely original. Other countries, such as Australia and New Zealand, had already adopted comprehensive measures in the years between the world wars, and the Swedish pension system of 1913 gave all citizens a modest benefit regardless of class or income in return for contributions.63 What was innovative was that Beveridge advocated a comprehensive system for all citizens, not just universal coverage for one risk or another, as was the case with other universalistic attempts made previously. It was exactly this comprehensive version of the universalistic approach that became the Report’s hallmark and anchored its reputation in other countries. Before Beveridge, social security on the Continent was organised in a corporatist manner. First, it was limited to manual workers. Later, it expanded gradually to other groups. New systems were created for new groups, such as white-collar salaried employees, who were insured separately from manual workers. Large sections of society, however, especially those who were not wage earners, were assumed to be capable of coping with misfortunes as individuals.‘Social insurance remained balkanised, it had managed to achieve only partial solidarities, to spread risks only within groups that were socio-economically quite homogeneous.’64 This was the attitude that changed after Beveridge. Social insurance was to embrace all citizens. On the other hand, by extending social insurance to everyone, Beveridge did not question the principle of insurance. On the contrary, he was a supporter of it. Benefits were to be financed by contributions, which could be afforded by everybody thanks to full employment. The public and the media received the Report rapturously when it was published in the middle of the Second World War.65 The triumphant success of the Report is usually attributed to a new sense of ‘equality for sacrifice’ and fair shares’ for all citizens that emerged after the patriotic fervour of the war. Different social classes had been mixed together, sharing the same air raid shelters, and free care in hospitals was extended from air raid casualties to all manual workers in the industries 62 The Beveridgean notion of citizenship, however, has been criticised for being ‘profoundly gendered’; see R Lister, ‘She has Other Duties—Women, Citizenship and Social Security’, paper presented at the York University conference, above n 32, Vol 5, at 15. For the gender criticisms of the Beveridge Report and the social citizenship model, see below ch 2. 63 P Baldwin, above n 61, at 30. 64 Ibid, at 27. 65 Some half a million copies were sold and there was said to be a queue a mile long at the government bookshop. The British Government, however, was not enthusiastic about the Report. The Treasury argued that the report could not be afforded and Churchill himself ‘reported to have taken strong exception to the Report, to have refused to see its author and forbidden any government department to allow him inside its doors’. Nevertheless, when the government presented its position in Parliament, that there could be no legislation during the war, it caused such strong reactions that 121 members voted against the government and many more abstained. The government had to reverse its position within a week and accept that there could be legislation. However, the actual implementation of the report fell to the Labour government elected after the war; see B Abel-Smith, above n 58, at 13–16. For a comprehensive summary of the reactions to the Report see also R Leaper, ‘The Beveridge Report in its Contemporary Setting’, paper presented at the York University conference, above n 32, Vol 1.

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30 Social Security in General of war-time Britain, certain chronic sick and others waiting for hospital care. In these circumstances, it was impossible to draw a line between those contributing to the war effort and those not.66 Greater equality of income emerged due to the high taxation levied to pay for the war, accompanied by full employment and rationing. In short, the war is assumed to have encouraged a general sentiment of social solidarity and to have nourished the perception that all citizens shared many risks in common. Even those who had formerly regarded themselves as capable of managing on their own without any aid from the state now found themselves facing the same risks on a similar footing.67 However, the wartime spirit of social solidarity alone cannot explain sufficiently the popular resonance of the Report. Other countries were also hit by the miseries of the war, but they did not follow the same path of development. It has been argued that the foremost quality that made the Report remarkable was the manner in which it balanced ‘on a knife edge both the collectivism and the individualism inherent in any social policy’.68 Others maintain that homogeneity of workers was an important factor. At the time of the Report, around 90 per cent of the labour force were dependent blue-collar workers, or white-collar employees with much less institutionalised status distinction than in Germany. This offered a social basis for the creation of a uniform national system.69 The social citizenship ideal was articulated by TH Marshall in his seminal essay in 1950 on ‘Citizenship and Social Class’. It was premised on the inclusiveness and universality of the Beveridge welfare state. Social citizenship was one of the three elements making up the status of citizenship. Marshall explained that citizenship is based on civil rights, political rights and social rights, that is to say rights to welfare. Marshall saw social rights as a part of the mechanism by which the social integration of each individual—the basic rationale for citizenship as an ideal—could be achieved.70 The concept of citizenship, as elaborated in the Beveridge Report, has been subject to severe criticism. It has been argued that one of its main flaws is that it is based on the erroneous assumption that the economy is able to sustain full employment. This criticism has sharpened in recent years. The Beveridgean principle of universality, based on contribution, which in turn is based on the condition of full employment, is likely to be undermined by growing poverty and social exclusion, preventing people from becoming regular contributors. As pointed out above, the ambiguity of the Beveridgean concept of social citizenship lies in this question: if all cannot be contributors, can they be citizens?71 Whereas the 66

B Abel-Smith, above n 58, at 13–14. P Baldwin, above n 61, at 23. Ibid, at 25–27. 69 P Flora, above n 9, at XX. For a comparison of the Report with international standards see A Otting, ‘The Beveridge Report and the ILO Standards on Social Security: A Comparative View’; Steering Committee for Social Security of the Council of Europe, ‘The Beveridge Plan Measured Against the Social Security Standards of the Council of Europe’, both papers presented at the York University conference, above n 32, Vol 1, at 129 and 139 respectively. 70 N Harris,‘Welfare State and Social Citizenship Rights’ in N Harris et al, above n 18, at 22. 71 P Baldwin, above n 61, at 37–38. See also B Jordan,‘Want’(1991) 25 Social Policy and Administration 15, at 15 in particular. Glennerster and Evans suggest that the historical context is critical to 67 68

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Social Security at the National Level 31 Beveridge Report has been described as the foundation for the extension of social citizenship, for Beveridge himself citizenship alone was not enough to ensure social rights. Workers were liable to pay contributions in order to qualify for benefits:‘The principle of universality and non-exclusivity was breached almost as soon as it was first uttered.’72 Citizenship is earned through participation in the labour market: ‘One earned one’s citizenship through working, just as, at an earlier time, one derived one’s citizenship through ownership.’73 On the other hand, occupationbased social citizenship has been of great assistance to foreign immigrants, who have often been able to acquire welfare citizenship before, or even in the face of exclusion from, political citizenship.74 Nevertheless, it has been pointed out that the contributory principle was chosen instead of a broad citizenship basis, first, due to its acceptability amongst working people as being the one that gave recipients moral worth through contribution. As a consequence, some contingencies were not conceptualised as social risks but were left to the domain of social assistance because they would not fit the contributory principle. In addition, the contributory principle was dysfunctional when it came to issues regarding women.75 Subsequent developments with regard to social citizenship have been complex. On the one hand, the rigid occupational derivation of rights was eroded in the face of demands for democratic citizenship. Increasingly generous systems of social assistance, extensions of women’s rights, and other innovations all contributed to reduce the stark contrast between those with rights earned at work and those without them. Some systems moved more fully towards political or universal citizenship rather than an occupational citizenship basis for welfare-state entitlements, principally the Scandinavian countries and the UK. On the other hand, two developments reinforced the occupational link: first, initially in Scandinavia in the 1950s and later, and on a more weak footing in the UK, an income-related component was added to the basic social insurance entitlement. Thus, some connection was retained between an individual’s level of pay whilst working and that when retired or otherwise out of employment. The departure from strict egalitarian principles involved in this was accepted by social democratic parties as the price that had to be paid to sustain the loyalty of middle-income groups to the national public system. Second, the rapid development of the Scandinavian, and to a lesser extent the British, welfare states, towards providing substantive services and not just understanding the assumptions embedded in the report. As they note, ‘he was only a creature of his times, a mirror not a prophet’: see H Glennerster and M Evans, ‘Beveridge and his Assumptive Worlds: the Incompatibilities of a Flawed Design’, paper presented at the York University conference, above n 32, Vol 1, at 17. For the historical context of the Report, see R Leaper, above n 65, Vol 1, at 1. See also R Lowe, ‘A Prophet Dishonoured in his Own Country? The Rejection of Beveridge in Britain 1945–65’, paper presented at the York University conference, above n 32, Vol 1, at 55. 72 P Squires,‘Of Benefit to Citizens’, paper presented at the York University conference, above n 32, at 2. 73 Ibid, at 9. 74 C Crouch,‘Employment, Industrial Relations and Social Policy: New Life in an Old Connection’ in N Manning and I Shaw (eds), New Risks, New Welfare (Oxford, Blackwell Publishing, 2000), at 104–5. 75 H Glennerster and M Evans, above n 71, at 20–21. For treatment of the family, women and children in the Beveridge Report and the British social security system since then see G Douglas, ‘The Family, Gender, and Social Security’ in N Harris et al, above n 18.

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32 Social Security in General transfer payments but also as providers of substantive services, produced a major expansion of predominantly female employment in the actual delivery of these services. This was then accompanied by a more general growth in female employment. Therefore, systems which had been based on universalistic rather than occupational citizenship came de facto to acquire the characteristics of occupational citizenship as the majority of adults, and not just males, worked. Social policies, developed primarily by labour parties and trade unions in Scandinavia, were as heavily linked to participation in employment as those in the Bismarckian tradition, albeit in different ways. It certainly was not part of their design to enable ablebodied men or women of working age to lead comfortable lives without working. While Scandinavian welfare rights were more rooted in universal than occupational citizenship, this was universal citizenship of a community which worked for its living—men and women alike.76 Social citizenship initially required nationality. Later, however, the necessary requirement became residence within the territory of a national state.

3. Social Security Models in the Member States of the European Union The emergence of social security in Western European countries is mainly attributed, as mentioned above, to similar processes of political and economic developments in those countries. Thus, important similarities can be found among the diverse systems, in particular when it comes to the risks covered. A number of social risks are covered by all national systems, and the same list of contingencies can also be found in international texts and conventions on social security. As already stated, those listed include risks of maternity, sickness, invalidity, old age, death, unemployment and care for children. All the systems provide for benefits in case such a risk becomes a reality. Furthermore, a common characteristic of all the systems is that they aim to produce a curative effect when a contingency has occurred. Little, if any, attention has been paid to preventive actions. It has been argued that social security should also aim at preventing certain of these contingencies from occurring at all, through actions ensuring safety in the workplace, preventive health care and employment policies.77 However, despite the common origins and characteristics, European welfare states developed essential differences so that today a variety of systems can be found in Europe.78 In terms of social security, it was only in the 1960s that the differences

76

C Crouch, above n 74, at 104–5. J Berghman, above n 13, at 18–19. The question whether there is a European social policy model has been a subject of debate since the 1980s; see FG Castles, ‘The European Social Policy Model: Progress since the Early 1980s’ (2001) 4 European Journal of Social Security 299. Castles himself argues that there is no European model distinct from the wider universe of advanced welfare states. He notes, however, that the question of whether this will always continue to be the case is another matter. 77 78

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Social Security at the National Level 33 in the various social security systems that developed after the Second World War began to be noticed.79 The most classical or typical division80 of the social security systems is into two groups, types or models of social security. The division is made on the basis of whether entitlements to social security are confined to categories of the active population based on work performance, or whether they are conferred as a right on the entire population within a country’s national borders. Systems where work performance is the essential criterion belong to the Continental or Bismarckian type of social security, while systems based on the principle of universality of benefits belong to the Atlantic or Beveridgean type. In terms of the social welfare state, this distinction mirrors two basic dimensions of the welfare state: the first referring to the ‘fragmentation’ of the welfare state, ie the degree to which welfare institutions reflect social differentiations, and the other to the ‘stateness’ of the welfare state, ie the degree to which the central state has ‘penetrated’ the welfare institutions.81 Some scholars maintain that the Scandinavian systems constitute a third model of the welfare state, distinct from the first two. Leibfried additionally identifies a fourth model, comprising the southern European States—the ‘Latin Rim’ countries.82 These models and classifications are described in more detail below, and attention is also given to other typologies that have attracted much interest in the academic world. However, all the systems have gradually incorporated elements from the others, and today there is no pure system of one type or another. Countries with an insurance tradition have introduced universal systems providing a minimum income, and countries where social security is based on the universal principle have adopted earnings-related schemes, which aim at income maintenance for 79 J Berghman, above n 13, at 16. Abrahamson argues that there has been a substantial development of welfare typologies in the last decade closely related to the debates as to globalisation and Europeanisation; see P Abrahamson, ‘The Welfare Modelling Business’ (1999) 4 Social Policy and Administration 394. 80 See eg J Berghman, above n 13, at 16; P Flora, above n 9, at XIX. 81 P Flora, above n 9, at XVII. According to Smits, the two models represent two different legal principles, ie the principle of legal security vs the principle of legal protection. See JH Smits, ‘Beveridge and the Continental Schemes: Legal Protection vs Legal Security. The Role of the Legislator and the Implementing Bodies’, paper presented at the York University conference, above n 32, Vol 2, at 1. For an account as to the issue of social assistance and its treatment in different countries, see I Lodemel and B Schulte, above n 32, Vol 2, at 13. See also P Spicker, Poverty and Social Security: Concepts and Principles (London, Routledge, 1993). 82 In the European Commission’s publication Social Protection in Europe (1995), four groups of Member States are distinguished according to the level of social protection they provide: the three Scandinavian countries, where social protection extends to all citizens as of right and where only unemployment insurance is separate from the state-run integrated system and voluntary rather than compulsory; the UK and Ireland, where coverage is virtually universal and flat rate basic amounts are the norm, though on a lower scale with extensive use of means-testing; Germany, Austria, France and the Benelux countries, where the insurance principle is more evident, benefits are more earnings-related, and gaps in coverage are supplemented by an extensive social assistance scheme; and Italy, Spain, Portugal and Greece, where the attempt to establish universal systems is more recent and systems are a mixture of fragmented, occupational and insurance-based income maintenance schemes (see pp 9–10 of the publication).

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34 Social Security in General the beneficiary in cases of need. Thus, all countries today present a mixed system in practice,83 and the systems are continuously and gradually converging.84 3.1 The Continental (or Bismarckian) Model Social security systems belonging to this model are based on work performance. Benefits are confined to well-defined categories of the working population, legitimised through the payment of contributions. Consequently, the insurance principle is the hallmark of these systems. The schemes are highly fragmented, addressing specific groups within the workforce. As the principal aim is income maintenance in times of need for those covered by the schemes, it follows that the system perpetuates class and status differences within the workforce, promoting only partial solidarity. This model is based on Bismarck’s aspirations of social insurance, having its roots in the early German insurance schemes. It is found mainly in Continental countries with a strong Catholic tradition. In countries where the Catholic principle of ‘subsidiarity’ prevailed, ie the state is expected and even permitted to intervene only when the family as a first resort has exhausted its capacity to help, social security developed on a fragmented, corporatist basis. In other words, stronger family bonds and family interdependence left less space for the development of state responsibility. Furthermore, the relationship between Church and State, in general, was considered to be crucial for the emergence and development of social security and its articulation in distinct models. This relationship varied in the Protestant North and the Catholic South. In the Catholic countries, the Church traditionally assumed responsibility for the care of the poor and sick as well as education, maintaining separate welfare organisations (schools, hospitals, etc) well into the 20th century. In the Protestant countries of the north, the property of the Church was confiscated and the clergy were incorporated into the bureaucracy of the territorial state, thus allowing the concept of public welfare to develop.85 France, Germany,86 Austria, Belgium, Italy, Greece, Spain and Portugal are considered to belong to the Continental model.

83 The trend towards convergence, obvious throughout the years of development and expansion of social security, was however restrained and even halted and reversed during the crisis of the 1970 and 1980s. The systems then tended to be less generous and expansive. In many cases, entitlement conditions were sharpened, means tests in social insurance type schemes introduced, and benefit levels reduced; see J Berghman, above n 13, at 16. For a more thorough discussion of convergence trends among Western welfare states, members and non-members of the European Union, see I Montanari, ‘Modernisation, Globalisation and the Welfare State: A Comparative Analysis of Old and New Convergence of Social Insurance since 1930’ (2001) 3 British Journal of Sociology 469. 84 J Clasen and W Van Oorschot,‘Changing Principles in European Social Security’(2002) 4 European Journal of Social Secuirty 89. 85 P Flora, above n 9, at XVI–XIX. 86 For a more complete account of the German Welfare State and social security system in English, see J Clasen and R Freeman (eds), Social Policy in Germany (New York, Harvester Wheatsheaf, 1994).

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Social Security at the National Level 35 3.2 The Atlantic (or Beveridgean) Model The characteristic feature of this model is that it is based on a concept of social citizenship as elaborated by Beveridge and Marshall.87 Benefits are individual, flat rate and granted irrespective of employment history. The schemes are relatively uniform, and administered through integrated institutions. As this model developed in countries with a long-standing poor law tradition, it places an emphasis on minimum income protection for the entire population, with the aim of combating poverty. In the traditional division of social security systems, the Atlantic model includes countries such as Great Britain88 and the Scandinavian countries, and is sometimes referred to as the Scandinavian-British model.89 Ireland is another country belonging to this model, while even the Netherlands90 is sometimes classified within this category. Among the factors that have been emphasised as contributing to the emergence of this model—apart from the structural differences owed to political developments and nation-building processes, as well as the relationship between Church and State—are the homogeneity or heterogeneity of blue-collar manufacture workers, their ties to farmers and their relationship to white-collar workers. The development of uniform and egalitarian national systems in Scandinavia, for instance, is partly attributed to a class compromise between the industrial workers and independent farmers, who were less remote from each other than on the continent, fighting together for the extension of voting rights.91 3.3 The Scandinavian (or Mixed) Model For certain scholars, the Scandinavian or Nordic countries constitute a separate model. Although no distinction can be made between these countries and the British system in terms of the legal basis of social rights and benefits (social citizenship in both cases), those in favour of such a distinction base their classification on the aims pursued. The aim of the British system, by providing minimum benefits, is to alleviate poverty. This is somewhat different to the Scandinavian system. Although flat rate universal benefits, based on social citizenship and without employment qualifications, are the backbone of the Scandinavian system, it also contains significant supplementary income-related benefits, financed by contributions, for those who have been actively employed. Thus, this system strives 87

TH Marshall, Class, Citizenship, and Social Development (New York, Anchor Books 1965). For a picture of social security law and policy in Britain, see N Harris et al, above n 18. Regarding the British social security system, see also R Lowe, The Welfare State in Britain since 1945 (London, Macmillan, 1999). 89 P Flora, above n 9, at XIX. 90 The Dutch system is sometimes classified as Continental and sometimes as Scandinavian. At its outset, the system was dominated by corporatist reasoning. However, it developed in a way which combined both Bismarckian and Beveridgean aspects. 91 P Flora, above n 9, at XX. 88

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36 Social Security in General to attain a dual objective: the alleviation of poverty through minimum income benefits at the level of subsistence for all; and income maintenance through earnings-related benefits for those in active employment.92 Some scholars have raised the questions of whether all Nordic states belong to the same model and whether there really is a distinct Nordic model. The answer has been that while a simple and straightforward ‘yes’or ‘no’answer cannot be given, the Nordic countries as a group tend to differ from the other groups of Western European countries in terms of key aspects of policy and welfare.93 3.4 The ‘Latin Rim’ Countries Leibfried distinguishes a fourth model of the welfare state regime, which in his opinion can be characterised as a ‘rudimentary welfare state’. One of the characteristic features of this model is that there is no right to welfare in several of the countries included in the category. Furthermore, older traditions of welfare (connected to the Catholic Church) appear to exist. Certain social security programmes serve as basic income measures, although they are not designed as such. Labour market structures are radically different and often reveal a strong agricultural bias. This bias combined with a ‘subsistence’ economy provides a different—nonnorthern European—‘welfare’state background. Finally, these countries do not have a full employment tradition—particularly with respect to women. The countries belonging to this model are Spain,94 Portugal, Greece,95 to a certain extent Italy, and, to the least extent, France. With regard to France in particular, the heavy family focus of all social policy, and concomitantly all wage policy, is perceived as leading to a special sort of welfare regime. Ireland also fits within this model, although it is not a southern country. Ireland’s peripheral location, its agricultural bent, and its religion – often seen as signs of ‘latinity’ – are viewed as responsible for this similarity. It should be noted, however, that many of these countries have made strong promises in their constitutions pointing towards a ‘modern welfare state’. What appears to be lacking in the ‘Latin rim’ is implementation at the legal, institutional and social levels of these promises.96 This categorisation has been criticised for treating the European periphery as being in a time warp, perpetuating a simplistic 92 For a more detailed analysis of social trends in the Scandinavian countries, see EJ Hansen et al (eds), Welfare Trends in the Scandinavian Countries (New York, ME Sharpe, 1993). 93 See M Kautto et al (eds), Nordic Welfare States in the European Context (London, Routledge, 2001). 94 As to the Spanish social security system and welfare state, see AM Guillén, ‘Social Policy in Spain: From Dictatorship to Democracy (1939–1982)’ in Z Ferge and JE Kolberg (eds), Social Policy in a Changing Europe (Frankfurt am Main, Campus Verlag, 1992), at 119–42. 95 An analysis of the Greek social security system and its current problems, with emphasis on old age pensions, can be found in P Tinios, Society, Economy, Pensions: A Hidden Treasure? (Athens, Papazisi Editions, 2001) (in Greek). 96 S Leibfried,‘Towards a European Welfare State? On Integrating Poverty Regimes into the European Community’ in Z Ferge and JE Kolberg (eds), above n 94. For a more detailed account of the southern welfare states, see M Rhodes (ed), Southern European Welfare States. Between Crisis and Reform (London, Frank Cass, 1997).

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Social Security at the National Level 37 north-south model that ignores the development and expansion of welfare systems that took place in the 1970s and 1980s. Some authors maintain that the transition from authoritarian rule in the 1970s in Greece, Portugal and Spain and the continuing reliance on various insurance modes suggest that these states are moving from fundamental to corporatist regimes.97 Notwithstanding any expansion of the welfare state, a key feature in all southern European regimes is the importance of the family in central areas of the welfare state. Although one cannot speak of a single model of the family across southern Europe,98 in all of these countries families have certain common functions that are particularly important in understanding, amongst other things, the integration of women into the labour market. Furthermore, families function as a safety net, providing security and assistance to their members, especially in times of unemployment. Families pool their income from a variety of sources, making it available to their members in areas in which state welfare grants are important in other countries, for example when starting a business, studying or seeking employment. They also provide services to children, and to the sick, elderly and disabled.99 Emancipation from the family through the labour market, in contrast with the northern countries, is not necessarily seen as valuable in itself.100 Strong economic ties remain between family members. Southern European welfare states have only recently become the subject of academic interest and research. In the past, they were either excluded from comparative studies of social policy, or subsumed within broader ‘families’ or ‘worlds’ of welfare capitalism, viewed as under-developed systems on the same trajectory of institutional development as their more advanced counterparts to the north.101 3.5 Other Classifications of the Welfare State Certain other classifications that have attracted major interest are described briefly in this section. A classical division is the ‘Titmuss’ division of welfare states into 97 E Kofman and R Sales, ‘The Geography of Gender and Welfare in Europe’ in MD García-Ramon and J Monk (eds), Women of the European Union. The Politics of Work and Daily Life (London, Routledge, 1996), at 41. 98 F Bettio and P Villa, ‘Un percorso mediterraneo per l’ integrazione delle donne nel mercato del lavoro? L’esperienza italiana’ in N Giatempo (ed), Donne del Sud: Il Prisma Feminile sulla Questione Meridionale (Palermo, Gelka Editori, 1993), cited in D Vaiou, ‘Women’s Work and Everyday Life in Southern Europe in the Context of European Integration’ in M-D García-Ramon and J Monk (eds), above n 97, at 68. 99 Concern has been expressed with regard to the availability of grandmothers and the role they can play in providing welfare in the future. It is estimated that their contributions are bound to diminish as female employment rates increase; see eg A Salvage, Who will Care? Future Prospects for Family Care of Older People in the European Union (Luxembourg, European Foundation for the Improvement of Living and Working Conditions, 1995), at 36. 100 D Vaiou, above n 98, at 68 with references. 101 M Rhodes,‘Southern European Welfare States: Identity, Problems and Prospects for Reform’ in M Rhodes (ed), Southern European Welfare States. Between Crisis and Reform (London, Frank Cass, 1997), pp 1–22. For a more complete discussion as to the question of whether the southern Member States constitute a separate model, as well as overviews of these state systems, see the other articles included in that book.

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38 Social Security in General three models. Within the first model—the residual model—welfare institutions come into play when the private market and the family break down. State intervention is limited to marginal and deserving groups. In the second model—the industrial achievement-performance model—social welfare institutions are adjuncts of the economy. Social needs are met on the basis of merit, work performance and productivity. Under the third model—the institutional redistributive model— social security is seen as a major integrated institution in society, operating to provide universalistic services outside the market.102 A typology that has recently attracted a lot of interest from scholars is that proposed by Esping-Andersen in his work The Three Worlds of Welfare Capitalism. According to this theory, welfare states are classified in accordance with the degree of de-commodification of workers that has been achieved. The assumption is that labour power and human needs have become commodities in modern capitalism. The individual’s right to survive outside the market is at stake. De-commodification occurs when a service is rendered as a matter of right, and when a person can maintain a livelihood without having to rely on the market. Thus, three welfarestate regimes are distinguished: the ‘liberal’ welfare state, where the predominant features are means-tested assistance, modest benefits and emphasis on the market. As a result, the effects of de-commodification in this model are minimised. The second is the conservative ‘corporatist’ welfare state, where the predominant features are that rights are attached to class and status, and the principle of ‘subsidiarity’, inspired by a strong Church, prevails. As a result, state policy upholds differences in status. Finally, there is the ‘social democratic’ welfare state, in which principles of universalism and de-commodification of social rights have been broadly extended to include the new middle classes. The United States, Canada and Australia are the most obvious examples of the first type; continental countries such as Austria, France, Germany and Italy belong to the second type; and the Nordic countries represent the third type. The British and Irish systems are classified as belonging to the ‘liberal’ model. Despite their grounding in solidarity, they entail a low degree of de-commodification because of the low benefits standards.103 No regime however is a pure one. Liberal elements can be found in the socialdemocratic type, conservative regimes have incorporated both liberal and social democratic impulses, and liberal systems can be compulsory and redistributive. Following criticism that many of the well-established typologies ignore gender,104 the typology of Walter Korpi incorporates both class and gender in the analysis. On the basis of the institutional structure of the main social insurance programs, which ‘have significant consequences for social policy outcomes of 102

RM Titmuss, Social Policy: An Introduction, B Abel-Smith and K Titmuss (eds) (London, Allen & Unwin, 1974). 103 For a discussion of Esping-Andersen’s typology and a comparison with other typologies, see D Mitchell, ‘Welfare States and Welfare Outcomes in the 1980s’, paper presented at the York University conference, above n 32, Vol A, at 47. See also P Taylor-Gooby, ‘Welfare State Regimes and Welfare Citizenship’ (1991) 2 Journal of European Social Policy 93, which analyses the typology from a gender perspective. 104 Below, ch 2.

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Social Security at the National Level 39 relevance for class and gender’, the following models are identified. The corporatist model, based on compulsory social security legislation, giving specified categories of citizens claim rights to the state in cases of sickness, work accidents and old age. Countries of the Bismarckian tradition such as Austria, Belgium, France, Germany and Italy belong here. The basic security model envisages universal or nearly universal coverage, based—at least in principle—on citizenship or residence. Private insurance is envisaged for high-income groups. Countries such as Canada, Denmark, Ireland, the Netherlands, New Zealand, Switzerland, the UK and the United States fall into this classification. Finally, the encompassing model envisages universal coverage in the sense that flat rate benefits are provided for all. In addition, the economically active have a right to earnings-related benefits. Finland, Norway and Sweden are classified under this model. Gender is treated differently in each model.105 The systems of the new Member States are not covered by these typologies; these states, however, are reforming their systems in order to conform with the systems of the older Member States. 4. Current Challenges and Developments in the Field of Social Security It is commonly accepted that the socio-economic environment, within the framework of which modern social security systems developed, has undergone radical change. This change challenges existing systems and creates major pressures to adapt if social security is to continue to play its role. Social security systems were conceived and developed in a socio-economic and demographic context that was profoundly different from today’s world. Dramatic changes have occurred in the labour market. Unemployment has proven to be a permanent and structural problem of European economies, while new forms of employment such as ‘atypical work’ have emerged. A further major change has been the gradual feminisation of the labour market, as more and more women have taken up employment. As a consequence, the two-income household tends to be the norm in most countries within the European Community, and is considered indispensable for achieving contemporary standards of material well-being. Changes in the labour market have been accompanied by changes in family structures. New forms of cohabitation, outside the traditional marriage structure, have appeared. Cohabitation outside marriage, as well as registered partnerships, are two forms challenging traditional marriage. At the same time, a steep rise in divorce rates has occurred. The steady, formal marriage is a much less common phenomenon than used to be the case. Other demographic changes are declining birth rates, an increase in the rate of single parent families, and longer life expectancy. 105

W Korpi, ‘Faces of Inequality: Gender, Class, and Patterns of Inequalities in Different Types of Welfare States’ (2000) 7 Social Politics: International Studies in Gender, State & Society 127. For another typology see FG Castles, Families of Nations: Patterns of Public Policy in Western Democracies (Aldershot, Dartmouth, 1993).

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40 Social Security in General 4.1 The Challenges and Pressures with respect to Current Social Security Systems All of these changes exert extreme pressure on social security schemes, because they challenge the traditional assumptions embedded in such schemes. 106 Changes in the labour market, in particular increasing unemployment107 and atypical work,108 are difficult to address within the framework of the existing social security schemes, which are based on different assumptions. The issue of the impact of changing labour forms on social security, including feminisation of the labour market, is currently a much-debated issue.109 Unemployment benefits in particular are based on the assumption that unemployment is a temporary situation, terminated by re-joining the labour market. For this reason, they are rarely provided for periods exceeding a few months. Furthermore, these changes challenge a basic principle of social security, namely the contributory principle that is inherent in all insurance inspired systems. This is also an important principle within the framework of systems based on the concept of social citizenship. The requirement to pay contributions presupposes the ability of the beneficiary to pay, an ability presumed to exist for all beneficiaries when the market sustains full employment. However, the ability to pay contributions is not a realistic expectation in an economic and labour context of high and enduring unemployment, with an increase in part-time and various forms of atypical work. Even those who have sufficient income are now less likely to be in secure employment than was the case some years ago. The number of self-employed has increased considerably and rapidly. The natural consequence of such an economic climate is that many people simply cannot afford to pay the contributions. The retention of the contributory principle, even in a rejuvenated form, has been criticised as being ill suited to the needs of an increasing proportion of the working population. Webb considers the eradication of the stigma in receiving benefits, previously paid for and thus ‘earned’,110 as the entire reason for retaining this principle.111 In addition, it has 106

The current problems in social security are mainly linked to social insurance. The social assistance part was actually seen as one of the few social policy ‘success stories’ of the 1980s and 1990s. It has been argued that social assistance has grown impressively in recent years in Europe, in response to both social changes and political efforts to trim back more expensive parts of the compensatory welfare state. See D Clegg, ‘The Political Status of Social Assistance Benefits in European Welfare States: lessons from reforms to provision for the unemployed in France and Great Britain’ (2002) 4 European Journal of Social Security 201. 107 For the pressures that such development exerts on unemployment schemes, see J Van Langendonck, ‘From Unemployment to Labour Market Insurance’ in D Pieters (ed), above n 14, at 193 et seq. 108 The protection of atypical workers under current social security systems has attracted considerable interest. See eg A Euzéby, ‘Social Security and Part-time Employment’ (1988) 127 International Labour Review 545; M Cousins, ‘Social Security and Atypical Workers in Ireland’ (1992) 131 International Labour Review 647. 109 See eg G Vobruba,‘Social Policy for Europe’ in W Beck et al (eds), The Social Quality of Europe (The Hague, Kluwer Law International, 1997); D Pieters (ed), Changing Work Patterns and Social Security, EISS Yearbook 1999 (The Hague, Kluwer Law International, 2000). 110 Above, at 1.1, a. 111 He notes, however, that this perception is in large part a myth. Those who receive income-related benefits have by and large ‘earned’ them through the payment of taxes. Though some may not have paid

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Social Security at the National Level 41 been argued that the income concept, used in most social security schemes, is highly inappropriate as it results in a calculation of benefits that refers to latest earnings. A fair calculation of income loss when damage has occurred, it has been suggested, should refer not to previous earnings but to the earnings that would have been achieved if no damage had occurred.112 It should be noted here that the issue of unemployment has attracted considerable interest at the European Community level.113 Female labour participation and changed family patterns constitute a major challenge as they affect systems in many ways.A major result of the emergence of the dual-breadwinner family is the new focus on unpaid work. Usually performed by women at home, unpaid work was not regarded as an insurable activity, since the sole income of the male breadwinner was adequate to provide for the needs of his family. However, against the background of a generalised two-income family standard, where the data shows that with one modest labour income the poverty level can barely be attained,114 unpaid work is considered to be a risk occurring even where there is still a breadwinner in the household.115 The risk is particularly high in the case of single-income households, especially with dependent children, where there is no partner to make up the shortfall of income. Child benefits, according to traditional thinking, were meant to provide the working population with the means necessary to meet the exceptional costs of a family after the arrival of a child. Given the current low levels of compensation, child benefits are not able to achieve their purpose or, consequently, compensate for the inadequacy of only one income. It has also been noted that the system today is inadequate to guarantee a minimum income to many single-income families with children, and to ensure the same standard of well-being and an equal degree of subsistence security for child-poor and child-rich families.116 The increasing participation of females in the labour market raises the issue of reconciliation of family and professional responsibilities. Schulte argues that measures have to be taken in order to achieve a balance. Nevertheless, as there has been greater recognition of the importance of caring, certain measures have been taken to reconcile family and professional responsibilities by removing obstacles to employment: these include providing social support in the form of personal social services (such as home care for elderly people) as well as providing social benefits as much income tax, all have paid VAT and other different types of taxes and duties. See S Webb, ‘Social Insurance and Poverty Alleviation: An Empirical Analysis’ in S Baldwin and J Falkingham (eds), Social Security and Social Change: New Challenges to the Beveridge Model (New York, Harvester Wheatsheaf, 1994), at 28. 112 J Berghman, above n 13, at 20–22. 113 See eg European Commission, Social Protection in Europe (Luxembourg, Office for Official Publications of the European Communities, 1995). See also Council Recommendation 92/442/EEC, below n 119, where particular attention is paid to young jobseekers and the long-term unemployed. 114 B Cantillon,‘Family, Work and Social Security’, paper presented at the York University conference, above n 32, at 44. 115 Ibid. 116 Ibid.

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42 Social Security in General for family carers and safeguarding their social protection rights during periods when they are not working (or working less) due to caring responsibilities.117 It has been pointed out that as the feminisation of the labour market grows with the increasing influx of women, a new type of worker emerges—one who has to combine paid work with unpaid work. Neither the labour market nor social security system is able to cater for this new type of worker at present.118 The need to safeguard the social protection rights of people whose working life is often interrupted due to caring responsibilities in relation to children, the disabled or the elderly, is now consistently on the social policy agenda of nearly all EU Member States. Throughout the Union, the fact that people need to be given a genuine chance of reconciling caring responsibilities with a working career is increasingly recognised.119 Furthermore, the establishment of the dual-breadwinner family as the norm has had the effect of transforming the relationship between risk and need. According to traditional thinking, the realisation of a risk means that a situation of need arises. This does not necessarily have to be the case in today’s circumstances. An absence of earnings does not necessarily imply poverty if there is a second income in the same household.120 The occurrence of the same contingencies thus does not necessarily mean that the same situation of need arises, as two-income families are potentially better able to survive. On the other hand, one-income families are more vulnerable than ever, even with the presence of an income. Consequently, the same risk has unequal effects for different categories of the population.121 The increasing number of one-parent families and one-person households further aggravates the problem of one-income families. Changes in the labour market and family patterns also challenge the requirements of many systems as to the completion of qualification periods. Adherence to

117 Ibid. See also B Schulte, ‘Social Security Legislation in the European Communities: Coordination, Harmonisation and Convergence’ in D Pieters, above n 1, at 154–5. 118 B Cantillon, above n 114, at 46. For changed family patterns and female labour participation see A Hatland,‘Changing Family Patterns: A Challenge to Social Security’ in M Kautto et al (eds), above n 93. 119 B Schulte, above n 117, at 154–5. In Council Recommendation 92/442/EEC on the convergence of social protection objectives and policies (below, n 197), that Member States should attempt to fulfil the task of providing employed workers who are forced to interrupt their careers due to, for instance, maternity with a replacement income is emphasised. Income should be fixed either in the form of flat rate benefits, or in the form of benefits calculated in relation to their earnings in their previous occupation (para IA 1(d)). That ‘social protection schemes must endeavour to adapt to the development of behaviour and of family structures where this gives rise to the emergence of new social protection needs, related in particular to changes on the labour market and demographic changes’ (para IA 3) is also emphasised. In particular, Member States are to adapt and, where necessary, develop their social protection schemes in order to organise for all women legally residing within the territory of the Member state coverage of the costs of treatment necessary due to pregnancy, childbirth and their consequences; and to ensure that employed women who interrupt their work for maternity reasons enjoy appropriate social protection (para B2, (a) and (b)). 120 B Cantillon, above n 114, at 43. Another reason might be the growth in employer-provided benefits, such as occupational pensions which supplement inadequate state pensions. See S Webb, above n 111. 121 See also B Cantillon, above n 114, at 43.

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Social Security at the National Level 43 a scheme becomes problematic for those who have been employed in the short term or experience repeated work interruptions which prevent them from meeting qualification requirements, as well as for those who have never joined the market before, such as new graduates and women. Demographic changes, such as new cohabitation forms, increasing divorce rates and prolonged life expectancy, all constitute further challenges to the systems. With regard to the former, Berghman writes: [T]he changes in the family are hard to grasp in the traditional social security context, partly because these changes are far from unidimensional. On the one hand, there is a trend of desegregation of the traditional family setting towards individual settings . . . also an aggregated trend manifests itself where factual family settings are getting out of their traditional legal cocoon by the spreading of cohabitation and gay couples. Both trends are difficult to reconcile with the traditional, stable and to some extent legal family model that underpins the existing benefit schemes and on the basis of which a very complex system of derived rights has been built.122

Divorce is also considered to be a scenario that has not received adequate coverage, as single divorced mothers face a high risk of poverty.123 In the European Commission’s report on Social Protection in Europe, it was found that a divorced woman who takes time out of the workforce to undertake child-rearing responsibilities was worse off at retirement age in terms of pension entitlements as a percentage of net average wages.124 Obviously, most of the social developments and pressures with respect to social security have a gender aspect. As a consequence, a greater individualisation of social security rights has been seen as a means for more adequate protection of women.125 Individualisation means that social security rights are attached to each person individually, and not dependent on marital or other relationships. In other words, social security rights are direct and personal and not derived. Berghman remarks that individualisation could easily be achieved in theory by introducing a social security system that focuses on factual scenarios, taking an individual approach as its basic frame of reference: [I]n practice, however, the old rights and derived rights cannot be overruled overnight. And using the two approaches at the same time poses problems of the unavailability of reliable information, of equity and of budgetary constraints. So, for the time being some categories of individuals, especially among women and children, tend to remain at risk. Their social security becomes heavily dependent on the availability of primary networks, family settings and alimony. The social security system not being capable or allowed to define their needs as social risks, a revival of old civil law institutions manifests itself.126 (emphasis added) 122

J Berghman, above n 38, at 258. B Cantillon, above n 114, at 45. European Commission, Social Protection in Europe (1993), cited in L Hancock, below n 137. In the 1995 report it was pointed out that divorce is a further complication to the problems created for social protection because of implications for caring responsibilities; see Social Protection in Europe (1995), at 21. 125 B Schulte, above n 117 at 154–5. 126 J Berghman, above n 38, at 258. 123 124

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44 Social Security in General The individualisation of rights finds strong support in the measures promoted within the framework of the European Community’s social policy. However, it has been argued that individualisation is very likely to have unequal effects on men and women, as women, to a much greater extent than men, continue to shoulder the burden of performing unpaid work at home and, as a consequence, present much longer and more frequent discrepancies in their employment history. Community measures promoting individualisation have raised concern: as much as they offer positive gains regarding the independence of women, they can also potentially dismantle the protection that many women need.127 Thus, it has been argued that individualisation presupposes recognition of the value of unpaid work. As Joshi and Davies note, ‘this important work still needs to be made more visible and rewarded rather than penalised in the social security system’.128 These issues are discussed in more detail in the following chapter.129 4.2 The Emergence of New Social Risks When new situations arise and new social needs are perceived, it must still be asked whether these needs should be defined as new risks, let alone as new social risks.130 Several attempts have been made to conceptualise new social risks based on the new changed conditions. Unemployment, family changes and dependency have all been seen as situations capable of constituting new social risks.131 Yet, it has been noted that ‘[t]o date these changes are of course not fully crystallised and, moreover, the pace of these developments differs from country to country, and maybe from region to region’.132 Increasing unemployment is seen as a situation to which social security systems have to adjust.133 It has been argued that a specific risk of non-employment has to be catered for, concerning in particular people under the age of 25 and women.134 Divorce is seen as a particular problem with regard to old age benefits, as women do not acquire sufficient entitlements due to their atypical careers: ‘This problem is recognised in many countries, but it is hard, if not impossible to find solutions within existing pension systems without reforming the structure radically . . . the problem could be solved by reforms of the pension system, but so far the political 127 H Joshi and H Davies,‘The Paid and Unpaid Roles of Women: How should Social Security Adapt?’ paper presented at the York University conference, above n 32, at 84. 128 Ibid. 129 Another issue with gender implications is the prolongation of expected lifespans leading to increased dependency of older people on care and raising issues of social security protection for care providers. 130 J Berghman, above n 38, at 256. 131 See J Van Langendonck (ed), above n 36. 132 J Berghman, above n 38, at 251. 133 See eg R Walker et al,‘Work Patterns in Europe and Related Social Security Issues: Coping with the Myth of Flexibility’ in D Pieters (ed), above n 109. 134 Unemployment and social security are also the subject of discussion from the opposite point of view, ie how current systems induce unemployment. See eg S Klosse, ‘Will Reintegration Get Europe Back to Work Again?’, paper presented at the International Colloquy The Nordic Model of Social Security in a European Perspective, held in Lillehammer, 8–10 September 1994.

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Social Security at the National Level 45 authorities have not been willing to accept more radical alternatives.’135 Joshi and Davis argue that women should retain an interest in their husband’s pension, for instance, on divorce.136 Hancock points out that, at the time of divorce, inequities in retirement pension membership are already well established and the trend is accentuated in retirement.137 Yet, despite the focus on this problem, divorce has never been conceptualised as a social risk in itself.138 The situation that is on its way to being fully recognised as a new social risk is the dependency of the elderly. Berghman writes: ‘For as far as dependency is concerned the problem of whether there is a new need or risk is in a way redundant . . . dependency has for a long time been covered, through all kinds of social security schemes, be it often in a piecemeal, dispersed and often inadequate way.What is new is that it is being defined as a risk in its own right.’ Thus, the new social risk of dependency has been separated from the risk of old age, as the risk of old age was once separated from the risk of incapacity to work.139 This risk of dependency exhibits two aspects that are of interest for social security. On the one hand, the risk of being dependent on care is now on its way to being recognised by the systems. On the other hand, it raises the issue of providing care regarded as a part of general family risk. Although there is little reliable information available as to the number of people caring for elderly people, indications suggest that it is substantial.140 In short, in the aftermath of all the changes in the socio-economic background of social security, one new social risk has been established: the risk of dependency during old age. With regard to the other emerging situations, most of the current efforts to cope with them are directed towards including them within the framework of the existing social security risks and schemes. 135

A Hatland and A Skevik,‘Changes in the Family’ in J Van Langendonck, above n 36, at 86–87. H Joshi and H Davies, above n 127, at 84. L Hancock,‘Citizenship on the Margins: The Case of Divorce in Western Europe’ in L Holmes and P Murray (eds), Citizenship and Identity in Europe (Aldershot, Ashgate, 1999) pp 97–119. According to the article, this raises questions concerning women’s position in terms of citizenship within the European Union. It is argued that the emerging conception of the European ‘citizen as worker’, wherein rights to benefits are directly linked to duration and level of participation in paid work, has implications in terms of gender, and those who are worse off are divorced women. 138 The Beveridge Report had already comprehensively explored the possibility of extending insurance-based contributory benefits to cover the risk of a family breakdown brought about by events other than the death of a husband; but no progress was made at the time. The result was that widows whose husbands had made necessary contributions over the years became entitled to pensions but no comparable provision was available for divorced, deserted or separated wives or for unmarried mothers. See SM Cretney and JM Masson, Principles of Family Law (London, Sweet & Maxwell, 1997). 139 Germany was first with the Long-Term-Care Insurance Act, which came into force on 1 January 1995. Until then, the risk for long-term care was covered by benefits from other existing schemes or from means-tested social assistance. However, the lack of an appropriate social protection scheme protecting against this risk was specifically increasingly felt to be unacceptable and a separate branch of social security was established; see J Berghman, above n 38, at 258–60. For more on the risk and the German system see B Schulte,‘Old Age and Dependency’ in J Van Langendonck (ed), above n 36. As to the risk of dependency, see also D Bouget,‘Vieillesse, dépendance et protection sociale’ in J Van Langendonck (ed), above n 36; E Alfandari, above n 37, at 48. 140 B Schulte, above n 117, at 154–5; see also A Salvage, above n 99. 136 137

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46 Social Security in General

II. SOCIAL SECURITY AT THE INTERNATIONAL LEVEL

The focus here is on international social security law, with particular focus on the co-ordination system of the European Community.

1. International Social Security Law With regard to international social security law, Kremalis writes that it is a term demarcating different phenomena. On the one hand, it means the social security rules that are promulgated by international organisations, for example the International Labour Organization (ILO), the European Council or the European Community. The concept ‘international social security law’ means in this context the law of social security which is enacted by international organisations imposing on their member states the obligation to adapt their national social security laws to international standards. States are free to develop their systems in any way they wish, provided they do not fall below the criteria established in the international social security rules. The term ‘international social security law’ can also be used to describe the immediate international relationship between national social security systems. Hence, the notion ‘international social security law’ can also mean the specific branch of national social security law that is designed to cope with the problems emerging from the existence of different national social security laws. In this context, international social security law functions to solve problems of this nature by establishing choice of law rules. In order to fulfil the above-mentioned tasks, national social security systems are usually related by special international agreements. These agreements can take the form of an international treaty under international public law; they can also assume the form of a binding law of an international organisation, such as Reg 1408/71. The main purpose of these international agreements is to co-ordinate the different national provisions as regards the international scope of national social security laws in order to avoid either loopholes in protection or protection by more than one national system.141 According to Watson, international social security law performs two main functions. It regulates the social security rights and obligations of migrant workers by co-ordinating the operation of social security systems of several states in such a way as to ensure that the migrant does not suffer any loss of rights by changing their country of employment. It sets minimum standards with which countries must comply, thereby ensuring the steady growth and improvement of social security systems. The first function is performed by bilateral or multilateral agreements and by conventions of international organisations. The second function is performed by international organisations.142 141 K Kremalis, ‘Principles of International and European (except EC) Social Security Law’ in D Pieters, above n 1, pp 132–3. 142 P Watson, above n 18, at 8.

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Social Security at the International Level 47 The need for co-ordination is justified by the problems caused at the international level as a consequence of the territorial limitations in the application of national social security systems. Social security systems are usually based on the principle of territoriality. This principle, which stands opposed to the principle of personality, means that social security benefits are granted within the national borders of a state, and do not follow the beneficiary wherever s/he goes. Social security legislation often contains provisions that make the conferment of benefits subject to requirements of residence. Residence requirements can refer to the worker himself or to members of his family. Thus, a migrant worker in receipt of an old age pension in the country of employment, who wishes to return to his country of origin, may be confronted with a serious problem if the legislation of the former state does not allow the payment of pensions outside national territory. Or, the migrant worker, whose family has remained in their country of origin, may find himself deprived of his right to family allowances if the legislation of the host state makes the payment of benefits conditional upon the place of residence of the family members. Similar difficulties can emerge if the migrant is in the process of acquiring his entitlement to benefits. Most social security systems demand compliance with qualification periods for some benefits. The most typical example of such a benefit is the old age pension. Some systems require the completion of a minimum period—usually several years—of employment for entitlement to the benefit, others deem the amount of benefit finally payable to be conditional on periods of contribution, while a third type of system combines requirements of both kinds. The migrant worker can easily find her/himself in trouble if her/his work record in a country is not sufficient to satisfy the requirements of the system. What s/he risks, ultimately, is reaching the end of her/his working life without having acquired any entitlement at all in any of the countries involved, although the total amount of the years s/he was economically active would have been sufficient to qualify him/her for the benefit in one country if s/he had spent all her/his working life there. It is obvious that the migrant worker does not easily fit into the pattern envisaged by most social security systems, which are mainly concerned with workers who stay and work all their lives in their country of origin, where both they themselves and members of their family reside. The need for co-ordination of the various national social security systems in order to avoid such problems emerged almost simultaneously with the emergence of the institution of social security itself. Bilateral and multilateral agreements were concluded between national sovereign states with the aim of co-ordinating their social security systems, while the work of International Organisations in this field contributed to the consolidation and uniformity of the basic principles of coordination. These agreements and conventions constitute the body of international social security law. Co-ordination of social security was also envisaged by theories of economic integration, which enjoyed great success in post-war Europe. Co-ordination of social security was also considered to be one of the necessary means for promoting the free movement of labour within the framework of the European Economic

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48 Social Security in General Community. The Regulations adopted to that end today constitute the social security law of co-ordination of the European Community. In the following pages, the main documents and traits of international social security law are discussed briefly, before focusing on the co-ordination law of the European Community. The section concludes with a discussion of the pressures currently exerted on the co-ordination system, and the efforts being made to adapt the system to new challenges. 1.1 Bilateral and Multilateral Agreements Social security issues were dealt with primarily in labour conventions concluded between states. However, the number of bilateral agreements devoted solely to matters of social security increased rapidly, while, at the same time, they became broader in scope in response to the development of the national systems. The first provisions relating to social insurance are to be found in the labour treaty concluded between France and Italy on 15 April 1904. Migrant workers having the nationality of one of the contracting parties were, pursuant to these provisions, assured equal treatment with native workers in cases of employment injury, and pensioners were granted the right to export benefits acquired under the legislation of one party to the other. The treaty also envisaged co-operation of the contracting parties concerning old age pensions, especially with regard to workers who had worked successively in both countries but had not established right to a pension in either of them. This first agreement was followed by several other bilateral agreements in subsequent years. The convention concerning workers’ insurance, concluded between Germany and Italy on 31 July 1912, provided for equal treatment of the nationals of the two contracting states with regard to compensation for accidents at work, and laid down the principle of the maintenance of rights with respect to certain benefits. During the period between the two World Wars, more detailed conventions relating to social insurance appeared, such as the conventions concluded between Italy and the Kingdom of the Serbs, Croats and Slovenes on 20 July 1925, between France and Italy on 13 August 1932 and between France and Spain on 2 November 1932. In addition to the principle of equality of treatment, they also laid down the principle of aggregation of insurance periods, and contained provisions as to the applicable legislation. The number of bilateral conventions on social security expanded enormously after the Second World War. Between 1946 and 1958, about 80 bilateral agreements between the six countries, originally forming the European Economic Community, were concluded.143 The total number of bilateral agreements signed between 1946 and 1966 has been calculated to be 401, 94 per cent of which were concluded between European countries, while in the majority of the remaining six per cent, one party was European.144 143

See ILO, Social Security for Migrant Workers (1977), at 16. J Holloway, Social Policy Harmonisation in the European Community (Westmead, Gower, 1981), at 124. 144

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Social Security at the International Level 49 After the Second World War, a new development took place: the conclusion of multilateral agreements, which reflected the increase in regional and international economic unions.145 These agreements aimed to co-ordinate the social security systems of all the countries involved in order to meet the needs of the workers whose career spanned several countries or whose families were scattered in several different states. The convention signed on 7 November 1949 by the Brussels Treaty Powers, which together formed the Western European Union (WEU)—Belgium, France, Great Britain, Luxembourg and the Netherlands—is a good example of a multinational agreement. The convention provided that the bilateral social security conventions concluded between these parties apply to all their nationals who are or have been subject to their social security legislation. Similar agreements are the agreement signed on 19 January 1951 between Belgium, France and Italy, and the agreement signed on 27 November 1952 between France, Italy and the Saar. The Agreement concerning the Social Security of Rhine Boatmen came into force on 1 June 1953 after ratification by Belgium, France, the Federal Republic of Germany, the Netherlands and Switzerland. It instituted a direct system of coordination between the five countries involved, and exercised, thereby, a strong influence on the development of international co-ordination. These agreements established a remarkable technique of co-operation among national social security systems, to the benefit of migrant workers. The most important principles laid down by the agreements include the principle of equal treatment between national and migrant workers; the principles of aggregation of insurance periods and pro rata-isation of benefits; and the principle of exportability of benefits. They also contained provisions on determination of the applicable legislation. These principles were embodied later in Art 42 of the EEC Treaty and in the regulations adopted on the basis of this article. However, although the development of general principles and the establishment of a co-ordination system contributed much to the protection of migrant workers, many lacunae remained. The need to protect migrant workers is often pointed out as the main reason for the conclusion of these agreements. Nevertheless, many researchers have asked whether this was a sufficient reason. Perhaps there were other or deeper reasons for the conclusion of international social security agreements? Nevertheless, it has been emphasised that it is not easy to find any such reasons. Kindleberger considers social security arrangements to be one of the competitive advantages a country wins in its effort to attract foreign workers as against other countries importing labour.146 145 The first multilateral social security agreement appeared in 1919. It was concluded between the Scandinavian countries, namely Denmark, Norway and Sweden. The agreement provided for the equal treatment of nationals of all the contracting parties concerning compensation for employment injuries. 146 One of the examples he mentions to support his view is an agreement signed between Belgium and Turkey. Belgium had hoped to be able to provide lower social security benefits to Turkish workers than to its indigenous workers. This failed under pressure from Turkey, which had been able to obtain local levels in other countries. Kindleberger considers housing as another competitive factor: see C Kindleberger, Europe’s Postwar Growth. The Role of Labor Supply (Cambridge MA, Harvard University Press, 1967), at 181–2.

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50 Social Security in General Holloway distinguishes several reasons behind the conclusion of social security agreements as between states: for the countries of origin, he assumes that the most significant advantage is the transfer of money from the receiving states.147 The advantages for the receiving states can be found in their efforts to encourage labour mobility or to create better conditions than other competitive countries in order to attract migrant workers; in their wish to maintain social stability in their territories; or in the advantages they win in a wider ‘package’ of negotiations in return for their willingness to sign a social security treaty.148 Several criteria, such as chronological, socio-economic or even international policy factors, have been invoked to explain the emergence and development of international treaties on social security.149 Perhaps ‘it would be both impossible and fruitless to trace the motives that lay behind all these treaties. It is enough to see them as a part of the general give and take of international relations’.150 What is interesting to note, however, is that such agreements usually followed or accompanied large-scale migration flows between the states concluding the agreement.151 1.2 International Organisations The work of international organisations has been very significant inasmuch as it has brought about a consolidation of the fundamental principles of social protection of migrant workers, and a measure of uniformity in the co-ordination methods employed by the treaties.152 International action in the social security field, which took place in parallel with the conclusion of bilateral agreements between states, resulted gradually in the development of a twofold system of protection. This benefited migrant workers inasmuch as the legal instruments developed at each level exercised an influence on each other and, in a way, supplemented one another. 147

J Holloway, above n 144, at 249. Ibid.As a typical example, where all these factors came into play, Holloway mentions the first social security agreement between Italy and France in 1904. At the time of negotiating the treaty, there were about 200,000 Italian workers in France, and only 10,000 French workers in Italy.Although the treaty was reciprocal in form, it is obvious that Italians benefited most in terms of facilitation of transfer of money and social security benefits from one country to the other. Italy was also anxious to ensure continuation in acceptance and equal treatment for Italian workers in France. Thus, France undertook to remove discriminatory provisions contained in French laws with regard to Italians. However, France benefited from the treaty too, since Italy, in return, committed itself to improving its social legislation. That was apparently very important for France because French products suffered a competitive disadvantage in France in comparison to similar Italian products, due to the lower costs of production in Italy. The lower costs were attributable to lower standards of social protection in that country. That had caused irritation in France for some time, and the French employers complained of economic damages as a result of the social backwardness in its neighbouring country. In addition, the situation led to hostilities towards Italian migrant workers. It was hoped that the treaty would lead to a rise in production costs in Italy. Thus, it is obvious that the conclusion of the treaty was in the interest of both countries. France was anxious to see an improvement in social security legislation in Italy, and Italy benefited from the transfer of money while safeguarding the rights of the Italian workers. 149 Ibid, at 251–2. 150 Ibid. 151 Ibid, at 248. 152 As to the role of International Organisations, see also P Watson, above n 18, at 16–29. 148

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Social Security at the International Level 51 Thus, while international instruments can provide a better ground for the establishment of fundamental principles, the complexity of particular situations can be better dealt with by bilateral agreements.153 a. The International Labour Organization The ILO, founded in 1919, has played a prominent role in the protection of the rights of migrant workers. One of its aims, as stated in its Constitution, is ‘the protection of the interests of workers when employed in countries other than their own’.154 Consequently, social security for migrant workers and members of their family has been a focus of ILO action from the start. The aim of the activities of the ILO was the development of international instruments concerning the declaration of fundamental principles and determination of general rules of co-ordination of national systems. The means employed to achieve this include a number of conventions, recommendations, resolutions and studies. ILO instruments have treated social security protection of migrant workers primarily from the angle of equality of treatment between foreign and migrant workers, on the one hand, and national workers, on the other. Ensuring fully equal treatment has been the common ultimate aim of all conventions referring to the social security of migrant workers concluded under the aegis of the ILO. However, it was commonly recognised that this aim could not be so easily achieved if migrant workers were to lose any of their already acquired rights or rights that were in the process of being acquired. Therefore, the principle of maintenance of rights acquired or in the process of being acquired was also established, as well as the principle of exportability of benefits. Furthermore, the conventions laid down rules concerning the determination of applicable legislation so that no doubt could arise as to which country’s legislation is to govern the social security protection of the migrant worker. The first convention providing for equal treatment of migrants was a labour convention—the Unemployment Convention (No 2) adopted in 1919. The states bound by Convention No 2, which had an unemployment insurance scheme, undertook to make arrangements to ensure that workers with the nationality of another state, working in their territory, would receive benefits equal to national workers. Subsequently, the Equality of Treatment (Accident Compensation) Convention, 1925 (No 19) called upon the states ratifying the convention to grant equal treatment to foreign nationals, on the basis of reciprocity, concerning compensation resulting from industrial accidents. Provisions relating to equality of treatment have consistently appeared ever since in conventions dealing with individual branches of social insurance, for example the Maternity Protection Convention (Revised),155 1952 (No 103), and the Invalidity Old-Age and Survivors’ Benefits Convention, 1967 (No 128). 153

ILO, above n 143, at 4. Ibid, at 1, Part XIII of the Treaty of Versailles of 28 June 1919, preamble to Section I,‘Organisation of labour’. 155 The Convention was revised in 2000 by Convention No 183. 154

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52 Social Security in General The principle of equal treatment was further entrenched in the general conventions that concerned the social security protection of migrant workers, such as the Social Security (Minimum Standards) Convention, 1952 (No 102). The Equality of Treatment (Social Security) Convention, 1962 (No 118), which concerned all branches of social security, provided for equal treatment not only within the territory of the state concerned, but also outside it. Benefits paid abroad to the nationals of the state concerned shall also be paid, under the same circumstances, to beneficiaries who have the nationality of another state, for which the Convention is also in force. The same Convention provided furthermore for maintenance of acquired rights and of rights in the course of acquisition.156 Convention No 157, which revised the former Convention of 1935 (No 48), covered all branches of social security and provided, in addition, for the determination of the applicable legislation. Equal treatment was envisaged on a reciprocal basis. Reciprocity is a fundamental condition for the application of the equal treatment principle in these international conventions. If a state refuses to grant equal treatment to workers from another state, it cannot expect that its own workers will receive equal treatment in the territory of that other state. b. The Council of Europe Several other international organisations, including the Council of Europe, have contributed to the improvement of living and working conditions for migrant workers. The work of the Council of Europe in the field of social security with respect to migrant workers had a twofold aim: first, to ensure that nationals of any one contracting state are, within the territory of any other contracting state where they are lawfully residing, treated equally with respect to the nationals of the latter state, under its social security legislation; and second, to extend the benefits which had been granted to nationals of two or more of the contracting states, on the ground of bilateral and multilateral conventions already concluded between them, to nationals of all the contracting states. On these grounds, two Interim Agreements were signed on 11 December 1953, and have been in force since 1 July 1954. The first, the European Interim Agreement on Social Security Schemes relating to Old-Age, Invalidity and Survivors (No 12), deals with benefits with respect to old age and disability, as well as survivors’ benefits. The second, the European Interim Agreement on Social Security other than Schemes for Old-Age, Invalidity and Survivors (No 13), deals with benefits with respect to sickness, maternity, unemployment, industrial injury, death grants and family benefits. Thus, the two Agreements together cover all spheres of social security.157 The Agreements were supplemented to some extent by the European Convention on Social and Medical Assistance (No 14).158 This Convention, signed and entering 156 Convention No 118 was supplemented, with regard to the maintenance of rights, by the Maintenance of Social Security Rights Convention, 1982 (No 157) This Convention was further supplemented by the Maintenance of Social Security Rights Recommendation, 1983 (No 167). 157 Both Agreements are accompanied by a Protocol, which extends their provisions to cover refugees, as defined by the Geneva Convention of 28 July 1951. 158 This Convention is also accompanied by a Protocol, which extends its provisions to refugees.

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Social Security at the International Level 53 into force at the same time as the Interim Agreements, extended the principle of equal treatment to social and medical assistance as well, containing certain clauses concerning the repatriation of the sick and indigent. The Interim Agreements were finally replaced by the European Convention on Social Security (No 78), which was signed on 14 December 1972 and entered into force on 1 March 1977. This Convention, which contained some immediately applicable provisions, covers all branches of social security, adopting the four principles of international law with regard to social security, namely equality of treatment, conservation of rights acquired or in the process of being acquired, unity of applicable legislation, and exportability of benefits. Also significant for the protection of the rights of migrant workers are the European Social Charter (No 35) signed on 18 October 1961 and entered into force on 26 February 1965, and the European Convention on the Legal Status of Migrant Workers (No 93) signed on 24 November 1977 and entered into force on 1 May 1983. Both incorporated the principles of equality of treatment, of conservation of rights acquired or in the course of being acquired, and of payment of benefits abroad. The Council’s activities in the field of social security for migrant workers also include a number of resolutions or recommendations passed by the Committee of Ministers.159 c. The Nordic Convention on Social Security The Nordic Convention on Social Security was concluded on 15 September 1955 by the five Nordic countries— Denmark, Norway, Sweden, Finland and Iceland—after the establishment in 1954 of a Nordic labour market. The convention brings about an ‘assimilation’ of nationalities since, according to the legislation of these states, a right to benefits is acquired on grounds of nationality or residence. Thus, a national of one of the contracting states who stays or lives or works in the territory of another state bound by the convention has to be treated equally with respect to nationals of the latter state. However, this assimilation, which takes the place of a system of maintenance of rights, is usually dependent upon the completion of a period of residence. The length of the period of residence required for the acquisition of the right to a benefit may vary according to the benefit concerned. The Convention was replaced by Reg 1408/71, which now applies to those Nordic countries which have joined the European Union. The now valid Nordic Convention on Social Security (Nordic Convention on Social Security of 15 June 1992), which came into force in 1994 when Reg 1408/71 became applicable in Finland, Norway and Sweden, covers, in principle, only people and benefits not covered by the Regulation.160 159 Such recommendations include Recommendation No R (90) 14 concerning information on the social security rights and obligations of migrant workers; Recommendation No R (91) 3 concerning the social security protection of seconded workers; and Recommendation No R (79) 7 concerning the speeding up of payment of mixed-career pensions. 160 A Christensen and M Malmstedt,‘Lex Loci Laboris versus Lex Loci Domicilii—an Inquiry into the Normative Foundations of European Social Security Law’ (2000) 2 European Journal of Social Security

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54 Social Security in General A significant difference between the Nordic Convention and other international conventions and agreements is that the personal scope of the former covers all people subject to the legislation in one Nordic country, including consequently even economically non-active people. Thus, the criterion for the designation of the personal scope of the Convention is residence in the national territory of one of the contracting countries. As Christensen and Malmstedt have stated, the principle providing the normative basis of the convention was the principle of equality, not the free movement of workers.161 This principle has now been adopted by the coordination system of the European Union, as discussed in chapter four, and is entrenched in the new Regulation 883/04.

2. Co-ordination of Social Security Systems between Countries Involved in the Process of Economic Integration According to economic integration theories, free movement of labour is implied in the context of economic integration.162 According to the traditional theories of economic integration, it is necessary to produce an efficient allocation of the factors of production by allowing them to move163 from low-productivity to highproductivity areas,164 in order to achieve a maximum benefit. In order to fulfil this aim, it is necessary, among other measures, to remove the legal obstacles to labour mobility, such as social security obstacles. 69, at 98. For the scope and principles of the Nordic Convention, see also M Sakslin, ‘Can the Principles of the Nordic Conventions on Social Protection Contribute to the Modernisation and Simplification of Regulation (EEC) No 1408/71?’ in Swedish National Social Insurance Board and European Commission (eds), 25 Years of Regulation (EEC) No 1408/71 on Social Security for Migrant Workers—A Conference Report (Stockholm, 1997), at 197–227. 161 A Christensen and M Malmstedt, above n 160, at 98. 162 Much ink has been spilt insofar as the definition of terms such as economic integration, common market and economic union is concerned. See eg R Sannwald and J Stohler, Economic Integration: Theoretical Assumptions and Consequences of European Unification (Princeton NJ, Princeton University Press, 1959); J Pinder, ‘Problems of European Integration’ in GR Denton (ed), Economic Integration in Europe (London, Morrison & Gibb Ltd, 1969); B Balassa, The Theory of Economic Integration (London, Allen & Unwin, 1973); D Seers and C Vaitsos, Integration and Unequal Development: The Experience of the EEC (New York, St Martin’s Press, 1980); T Straubhaar, ‘International Labour Migration within a Common Market: Some Aspects of EC Experience’ (1988) 27 Journal of Common Market Studies 45. Since this discussion is far beyond the scope of the present study, when referring to the European Community the terms are used as they are commonly used, without any demands of accuracy in terms of economic theories. 163 With regard to labour movements, Paxton points out that there is an essential difference between ‘mobility’ of labour and ‘migration’ of labour. Referring to Robert Marjolin, vice-president of the European Commission, he mentions that migration of labour, though sometimes necessary, is generally accompanied by sociological, psychological and political difficulties, and, therefore, it is more desirable for industry to move to the worker. However, a worker should have the right (his emphasis) to move to another country to work or look for work there, in addition to his right to do the same in his own town. See J Paxton, The Developing Common Market: The Structure of the EEC in Theory and Practice (Boulder CO, Westview Press, 1976), at 147–8. 164 W Molle and A Van Mourik,‘International Movements of Labour under Conditions of Economic Integration: The Case of Western Europe’ (1988) 26 Journal of Common Market Studies 317, at 317. See also T Straubhaar, above n 162, at 46; J Pinder, above n 162, at 166.

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Social Security at the International Level 55 Theories of economic integration attracted an enormous degree of interest in the post-war era, owing to the belief that integration would foster economic growth and increase welfare. Apart from the EEC, the formation of the Benelux economic union, the European Coal and Steel Community (ECSC), and the European Free Trade Association (EFTA) evidence a move towards integration at the European level. Efforts to establish a common labour market have been made on several occasions in post-war Europe within the framework of regional agreements, as it has long been recognised that the mobility of manpower is a basic condition for economic progress.165 The agreement signed between four Nordic countries—Denmark, Norway, Sweden and Finland—in 1954 marked a more far-reaching attempt on the part of the contracting parties not only to establish a common market of manpower, but also to bring their employment policies into line.166 Co-operation was envisaged as to several matters including exchange of information regarding the employment situation and its trends, the maintenance of full employment, and the possibility for any of the four governments to propose measures of common interest in the employment and labour areas.167 Efforts to liberalise labour movement in Europe have also been made at the initiative of organisations such as the Council of Europe, and the Organisation for European Economic Co-operation (OEEC). Preventing the loss of social security entitlements is considered to be one of the most important conditions for the achievement of free movement of workers.168 However, although the removal of social security obstacles is a necessity for the legal liberation of labour movements, it is not in itself one of the main factors determining the size or direction of migratory movements. Nevertheless, social security arrangements are among the complementary measures required to make free movement of labour practically possible. Measures concerning admission and stay in a new country, housing and vocational education are of equal importance.169 165

The first agreement envisaging free labour movement was signed in 1951 between the Brussels Treaty powers. A Convention on social security was also concluded with the aim of facilitating the movement of workers. Free movement of labour was furthermore one of the elements in the cooperation between the Benelux countries. 166 X Lannes, ‘International Mobility of Manpower in Western Europe: II’ (1956) 73 International Labour Review 135, at 143. 167 Ibid. 168 See eg W Molle and A Van Mourik, above n 164, at 321; N Andel, ‘Problems of Harmonization of Social Security Policies in a Common Market’ in C Shoup (ed), Fiscal Harmonization in Common Markets (New York, Columbia University Press, 1967), at 383; G Yannopoulos, ‘Economic Integration and Labour Movements’ in GR Denton (ed), above n 162, at 221–2 and 232. The latter classifies the lack of harmonisation of social security policies as one of the artificial obstacles to mobility, arising due to the existence of national frontiers, and bound to be removed during the process of economic integration. 169 W Molle and A Van Mourik, above n 164, at 321; Kindleberger counts housing facilities, as well as social security arrangements, as one of the competitive advantages in a country’s effort to attract foreign labour. See C Kindleberger, above n 146, at 181 et seq. Poor housing conditions in receiving countries were listed, for example, as one of the factors contributing to the decrease in the number of Italian migrants, in a Commission report submitted in 1970. See N Falchi, ‘Le régime définitif de la libre circulation et l’immigration des pays tiers’ (1971) 11 Droit Social 17, at 20. The French report, which was one of the national reports underlying the ECSC report on Obstacles to Labour Mobility and Social

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56 Social Security in General 2.1 Co-ordination of the Social Security Systems of the Member States in the EEC Treaty Free mobility of labour was recognised as essential in the discussions for closer economic co-operation among the European states,170 and it was established as one of the fundamental principles of EEC law. The principle was already laid down with regard to skilled labour in the Treaty of Paris, which founded the European Coal and Steel Community (ECSC). This was admittedly of grave concern to the Community, as it was feared that the establishment of a common market might compel some firms, or at least some branches of firms, to go out of business, or to switch to other products.171 Furthermore, it was feared that the introduction of new technology and equipment in the coal and steel industries was likely to lead to reduced labour needs. In any case, it was estimated that redundant workers would encounter difficulties in their effort to find new jobs, locally or in the same industry.172 One of the methods employed by the ECSC Treaty to soften the undesirable effects of the creation of the common market on the labour force was facilitating the employment of qualified workers in all Member States, irrespective of their nationality.173 Indeed, the right to free movement was not confined only to skilled labour in the EEC Treaty. It was conferred on all workers174 and on selfemployed people who wished to establish themselves in the territory of a Member State other than their own, in order to pursue economic activities therein,175 or who wished to provide services in another country of the Community.176 The elimination of social security obstacles had already been recognised as a necessary condition for the liberalisation of labour movements within the framework of the ECSC Treaty. Article 69(4) of the Treaty of Paris provided that Member States ‘shall endeavour to settle among themselves any matters remaining to be dealt with in order to ensure that social security arrangements do not inhibit labour mobility’.177 On the basis of this article, and after long and difficult negotiations, the European Convention on the Social Security of Migrant Workers was signed on 9 December 1957 by the six original Member States of the European Coal and Steel Community. This Convention was prepared by a committee of governmental experts, with the assistance of the International Labour Office. It aimed at improving the rules of Problems of Resettlement, noted that the housing question was ‘the most serious, the most heavily criticised and the most obvious material obstacle; no outright move can even be considered unless houses are available at the new place of work’. See ILO, ‘Obstacles to Labour Mobility and Social Problems of Resettlement’ (1957) 76 International Labour Review 76. 170 R Sannwald and J Stohler, above n 162, at 225; ILO, Social Aspects of European Economic Cooperation: Report by a Group of Experts (Geneva, Studies and Reports. NS 46, 1956), at para 233. 171 ILO, above n 170, at 72. 172 Ibid. 173 ECSC Treaty, Art 69(1). 174 Art 48 et seq of the Treaty (Art 39 after the Amsterdam Treaty). 175 Art 52 et seq of the Treaty (Art 43 after the Amsterdam Treaty). 176 Art 59 et seq of the Treaty (Art 49 after the Amsterdam Treaty). 177 It has been pointed out by the High Authority that Art 69 was interpreted by the national governments in a very restrictive way; see R Sannwald and J Stohler, above n 162, at 226.

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Social Security at the International Level 57 international social security law, which were already laid down by the pre-existing bilateral and multilateral agreements. It covered not only workers employed in the coal and steel industry, but also all salaried workers who were nationals of the interested countries. Self-employed workers (ie independent professionals), on the other hand, were excluded. The Convention was soon converted into a regulation of the European Economic Community,178 which had by then been established, becoming Reg 3/58 of the EEC. At the same time, the High Authority of the ECSC declared that the regulation could replace the arrangements made on the grounds of Art 69(4) of the ECSC Treaty. The EEC Treaty gave social security a central role in the promotion of free movement. However, no special provisions existed in the text of the Treaty with regard to other promoting factors, such as housing and vocational education. Tax law and labour law co-ordination were also left outside.179 Therefore the following question has been posed: Why was emphasis placed on the co-ordination of social security systems while the Treaty itself was silent on other matters, which were equally—if not more—important for the facilitation and promotion of labour movement?180 Whatever the reason, the utility of social security co-ordination for the promotion of free movement has not been undisputed. It has been argued that equal social security rights for migrants have outweighed one of the main advantages in employing them, namely their cheapness.181 It has also been argued that the conferment of benefits on the family members of a migrant worker makes the employment of foreign workers less profitable. Raising the social costs of the migrant labour system leads to a decrease in the importance of this kind of labour.182 Nevertheless, Reg 3/58, which implemented Art 42 (Art 51 at that time), was the first social measure of the Community. It appeared soon after the Treaty entered into force, despite the fact that the accomplishment of free movement was subject to a transitional period expiring on 1 January 1970.183 Regulations 3/58 and 4/58 have been revised several times since their adoption. The revisions were strongly 178 Holloway notices that the Convention was converted into a regulation partly in order to avoid the inconveniences of a parliamentary ratification; see J Holloway, above n 144, at 260 with references. 179 See D Pieters,‘Europe and Posting: Some Reflections’, in Social Security Institute of Greece (IKA) and the European Commission (eds), The Free Movement of Workers within the European Union: Posting and the perspectives of Community co-ordination in the context of the Regulation 1408/71, Conference Report (Crete, 1995). 180 Before the EEC Treaty was drafted, there had been a discussion about the need to harmonise wages and the other elements of manpower costs, for example social security contributions, prior to liberalisation of labour movements, but this need was not recognised by the majority of the participants in the debate. Therefore, the Treaty only exceptionally regulated related matters, as in Articles 51 and 117–18; see M Molle, The Economics of European Integration (Aldershot, Dartmouth, 1990), at 215. 181 S Paine,‘The Changing Role of Migrant Labour in the Advanced Capitalist Economies of Western Europe’ in R Griffiths (ed), Government, Business and Labour in European Capitalism (Papers Presented at the January 1977 Conference of the University Association for Contemporary European Studies) (London, Europotentials Press, London 1977), at 206. See also J Holloway, above n 144, at 259 et seq. 182 S Paine, above n 181, at 213–14 and 222. The same has been maintained with regard to belowstructural facilities, housing etc, provided for migrants. 183 Free movement was finally regulated in 1968 by Reg 1612/68 ([1968] OJ L257/2).

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58 Social Security in General influenced by the interpretation given to their provisions by the Court of Justice.184 Finally, they were replaced by Regulations 1408/71 and 574/72. The method of co-ordination was chosen before the method of harmonisation. When the Treaty of Rome was being negotiated in the 1950s, France proposed the inclusion in the Treaty of methods of harmonisation. The other negotiators, however, especially Germany, did not accept the proposal, as they did not believe harmonisation of social security systems to be necessary for the promotion of the objectives of the Treaty. The Treaty does not, therefore, contain any specific proposal for harmonisation, but only provisions that can be used as a basis for harmonisation. In the years that followed, however, the idea of convergence, meaning that the legislative provisions do not have to be identical but the effects of the national legislation implementing common objectives should be convergent,185 was reinforced. Co-ordination is defined as:‘Co-ordination rules are rules of international social security law intended to adjust social security schemes in relation to each other (as well as to those of other international regulations), for the purpose of regulating transnational questions, with the objective of protecting the social security position of migrant workers, the members of their families and similar groups of persons.’186 Regulation 1408/71 was based on the main principles of co-ordination law, which had been elaborated and developed in the pre-existing international agreements.187 It should be noted, however, that the social security law of coordination of the European Community is considered by many authors as sui generis law. Kremalis notes that there is a qualitative difference between international law and the law of integration (EEC law). The former is a law of conflict and co-operation based on the hidden premise that national interests prevail over all considerations in order to leave state sovereignty intact. The latter, on the contrary, as a law of solidarity and integration, presupposes the establishment of a common interest in economic affairs. International social security law in particular does not penetrate as deeply into the life of states as European social security law does. Its rules are mainly reduced to mutual rights and duties between the states. European social security law, on the other hand, regulates rights and duties between the Community and its subjects, Member States and private people and between private citizens as amongst themselves.188 The principles of co-ordination, adopted by Reg 1408/71, include the principle of non-discrimination by reason of nationality, the principle of aggregation of qualification periods, the principle of exportability of benefits and the principle of a single applicable legislation. 184 See JC Séché,‘The Revision of Regulations No 3 and 4 (Social Security of Migrant Workers) in the Light of their Interpretation by the Court of Justice’ (1968–9) 6 Common Market Law Review 170. 185 See B Schulte, ‘Social Security Legislation in the European Communities: Co-ordination, Harmonisation and Convergence’ in D Pieters (ed), above n 1, pp 153–75. A full account of the coordination and harmonisation law of the European Community is given in F Pennings, Introduction to European Social Security Law (The Hague, Kluwer, 2001). 186 F Pennings, above n 185, at 7. 187 See also K Kremalis, above n 141, at 146 et seq. 188 Ibid, at 134.

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Social Security at the International Level 59 2.2 Challenges and the Latest Developments in the Social Security Law of Co-ordination of the European Community Over the years, Reg 1408/71 has been the subject of increasing criticism. Discussions about how the co-ordination system will face the new conditions that have been created and the challenges they represent became intense; they have mainly revolved around two key words: the simplification and modernisation of Reg 1408/71. A major point of criticism against Reg 1408/71 has been the complexity of its provisions.According to Pennings, there are three main reasons for this complexity: the many exceptions to the Regulation’s many rules; the growing abundance of the case law based on interpretation of the Regulation’s provisions which are remote from the literal text; and the lack of an explanatory memorandum to the Regulation, meaning that readers (and the Court of Justice) have to interpret the provisions themselves.189 The need for simplification has been emphasised on several political and academic levels, and there was a general consensus that the Regulation was in need of reform. Pennings pleaded for a more uniform approach to the treatment of concepts and of benefits in the Regulation and considered that a good analysis by the Commission of the problems should precede a proposal for amending the Regulation.190 Ojeda Aviles emphasised the need for both material and procedural simplifications, as well as simplifications in the form, including the wording of the provisions, of Reg 1408/71.191 Pieters suggested simplification of Reg 1408/71 by means of a review of its basic principles and partial replacement by new principles.192 Palme argued that, against the background of the lack of coordination in modes of financing national social security, the situation could be simplified by restricting co-ordination to income replacement programs, typically related to employment, and thus to the movement of labour. Other benefits and services should be considered as part of the Citizen’s Europe, and be awarded to the residents of each nation state by their respective state. Even though there might be an ethnocentric bias in this proposal, he argued that it would undoubtedly simplify the situation, and give a new meaning to Worker’s and Citizen’s Europe by clarifying the responsibilities of the nation states with respect to these groups.193 189 F Pennings, ‘The European Commission Proposal to Simplify Reg 1408/71’ (2001) 31 European Journal of Social Security 45, at 45. 190 F Pennings, above n 185, at 246. 191 A Ojeda Aviles,‘How the Current Provisions of Regulation (EEC) No 1408/71 could be Simplified (Means of Restructuring and Simplifying Regulations (EEC) Nos 1408/71 and 574/72)’ in Swedish National Social Insurance Board and European Commission (eds), above n 160. 192 D Pieters,‘Towards a Radical Simplification of Social Security Co-ordination’ in Swedish National Social Insurance Board and European Commission (eds), above n 160, pp 169–95; See also M Sakslin, above n 160, at 199-223; C Laske, ‘The Impact of the Single European Market on Social Protection for Migrant Workers’ (1993) 30 Common Market Law Review 515. 193 J Palme, ‘Social Policy Regimes, Financing and Co-ordination’ in Swedish National Social Insurance Board and European Commission (eds), above n 160, at 122. On simplification and harmonisation see also Y Jorens and B Schulte,‘The Implementation of Regulation 1408/71 in the Member States of the European Union’ (2001) 3 European Journal of Social Security 237.

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60 Social Security in General The very idea of co-ordination of social security systems within the framework of a union, such as the European Union, has been questioned. Much of the distrust of co-ordination is owed to the complexity of the Regulation.194 Many scholars are of the opinion that harmonisation would be a more appropriate method for achieving the objective of the Community’s social security law.195 The idea of harmonisation, indeed, has never been completely abandoned, and theories such as the Social Snake theory and the Thirteenth State theory attracted much attention, although they were never finally adopted. The former, proposed by Dyspersyn and Vandervorst, has sought to encourage convergence of social security systems in an upward direction through a mechanism that is based on establishment of the European average of social protection and adjustment of Member States with a lower level of protection to it. By analogy with the monetary snake system, it was called the ‘Social Snake’ system. The latter, developed by Pieters and Van Steenkiste, proposed the creation of a European social insurance system specially designed to protect migrants: the so-called ‘Thirteenth State’.196 Convergence of national systems has won a lot of support as a proper means of avoiding the disadvantages of co-ordination. In the preamble to Council Recommendation 92/442/EEC of 27 July 1992 on the convergence of social protection objectives and policies197 it is emphasised that convergence of national systems would help to overcome the disadvantages that derive from the differences in social security cover among Member States and which might act as a serious hindrance to the free movement of workers.198 Nielsen and Szyszczak have expressed the view that this Recommendation, together with Council Recommendation 92/441 on sufficient resources and social assistance,199 constitute limited but important steps towards harmonisation.200 Other authors have argued that social security will remain a major topic of national policy in the future, but not merely of national policy, as the EU’s influence becomes increasingly noticeable and important.201 194

E Eichenhofer, ‘How to Simplify the Co-ordination of Social Security’ (2000) 2 European Journal of Social Security 231. 195 See eg R White, EC Social Security Law (Essex, Longman, 1999), at 133–4. 196 For an account of both theories see D Pieters, ‘Will “1992” lead to the Co-ordination and Harmonization of Social Security?’ in D Pieters, above n 1, at 186–90. Numhauser-Henning questions the existence of a legal basis for the creation of such system: see A Numhauser-Henning, ‘Freedom of Movement and Transfer of Social Security Rights’, paper presented at the VII European Regional Congress of the International Society for Labour Law and Social Security in Stockholm, 4–6 September 2002, in Congress Sekretariat, Labour Law Congress 2002: Reports, at 197. 197 [1992] OJ L245/49. 198 With regard to background thoughts as to this recommendation and a discussion of the difficulties in converging the systems, see European Commission, Social Europe, Supplement 5/92: The Convergence of Social Protection Objectives and Policies (Luxembourg, Office for Official Publications of the European Communities, 1992). 199 [1992] OJ L245/46. 200 R Nielsen and E Szyszczak, The Social Dimension of the European Union (Copenhagen, Handelshöjskolens Forlag, 1997), at 133. 201 E Eichenhofer, ‘Social Security as a Matter of Mere National Policy? Perspectives of European Social Security Law’ in A Numhauser-Henning (ed), Normativa Perspektiv. Festskrift till Anna Christensen (Lund, Juristförlaget, 2000). There is an immense number of scientific works with regard to

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Social Security at the International Level 61 Nevertheless, greater convergence in the field of social protection is expected to be brought about by the ‘open method of co-ordination’. The open method of coordination means that all countries fix common objectives in a given policy area, prepare national action plans, examine each other’s performance with Commission guidance, and learn from their successes and failures. It is a new way of working together in the EU—no longer only through legislation, but through flexible yet structured co-operation among Member States. It is now applied to social protection.202 The numerous solutions that have been proposed over the years for the simplification of the co-ordination system have been summarised as indicating three different approaches: piecemeal reform of Reg 1408/71; a European scheme for migrants; and a simplified unified system of co-ordination. The third approach suggests maintenance of the actual substance of co-ordination law but utilising a ‘more understandable and more elegant means of expressing it’, where the goal would be to define co-ordination in terms of general principles.203 In addition, the need to modernise Reg 1408/71 in the light of significant changes in national law, on the one hand, and of general changes such as globalisation and development of an information society, on the other, has constantly been raised as an issue.204 Within the context of modernisation, the narrowness of the personal scope of Reg 1408/71 has been greatly criticised, both with regard to the emphasis paid to the pursuit of an economic activity and with regard to the emphasis paid to the existence of nationality of a Member State for its application.205 The material scope of Reg 1408/71, which includes the eight traditional social security areas set out in ILO Convention No 102, has also been criticised for being narrow. The exclusion of certain kinds of benefit from Art 4(1), such as social and medical assistance, and the lack of co-ordination of occupational and private social security schemes, which have grown in recent years, have been pointed out as important aspects of this narrowness.206 The Commission’s Action Programme to implement the Social Charter of 1989207 has also highlighted the problem. the European Community’s social policy. See eg S Leibfried and P Pierson, above n 6; L Hantrais, above n 11. For a historical overview see D Collins, The European Communities, The Social Policy of the First Phase, vol 1, The European Coal and Steel Community, 1951–1970, and vol 2, The European Economic Community, 1958–1972 (London, Martin Robertson, 1975). Schulte emphasises the need to strengthen European social policy: B Schulte ‘The Welfare State and European Integration’ (1999) 1 European Journal of Social Security 7. 202 See European Commission, Social Agenda, Issue No 1 (2002), at 7. For a complete discussion, see J Berghman and K Okma, ‘The Method of Open Co-ordination: Open Procedures or Closed Circuit? Social Policy Making Between Science and Politics’; and B Schulte, ‘The New European “Buzzword’: Open Method of Co-ordination’, both (2002) 4 European Journal of Social Security, at 331 and 343 respectively. 203 See A Numhauser-Henning, above n 196, at 197. 204 See eg G Igl, ‘Co-ordination and New Forms of Social Protection’ in Swedish National Social Insurance Board and European Commission (eds), above n 160; M Sakslin, ‘Social Security Coordination—Adapting to Change’ (2000) 2 European Journal of Social Security 169. 205 Below, ch 4 at I, 1.3. 206 R Nielsen and E Szysczcak, above n 200, at 128. 207 COM (89) 568 final, Part 11/4.

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62 Social Security in General The narrowness of both its personal and its material scope has also been highlighted as problematic in the Commission’s Green Paper on obstacles to transnational mobility.208 As noted, Reg 1408/71 runs the risk of becoming outdated and losing touch with a number of developments. Member States have recently introduced new types of benefit, for example those catering for an increasingly ageing population, which cannot easily be accommodated within the legal concepts contained in Reg 1408/71.209 Furthermore, the effectiveness of basic principles of co-ordination has also been called into question. For example, the sufficiency of the principle of the application of the legislation of the Member State of employment (the lex loci laboris principle) is currently under investigation not only in areas such as posting and pensions, but also from the point of view of different categories of employed people, created in the aftermath of changes in labour market forms and migration patterns.210 Finally, a new Regulation, 883/04, was adopted with the aim of simplifying and modernising Reg 1408/71.211 The process of simplification is intended to make the rules more understandable for citizens moving within the Union and to overcome practical problems and red tape in day-to-day applications of the Regulation.212 Changes in the labour market and in migration patterns, creating situations involving for example posting and pre-retirement in particular, which had attracted extensive attention in the discussions before, are given considerable space in the new Regulation.213 In contrast, family and demographic changes have not attracted so much attention. In general, improving social protection for people moving within the Union has been identified as a key issue for the improvement of social protection itself.214 Currently, two co-ordination regulations are in force, namely Reg 1408/71 and Reg 883/04. Regulation 1408/71, which is the one that applies, is subject to amendment in order to adapt to changes in the systems of the Member States. In any case, however, it has to be noticed that despite its complexity, Reg 1408/71 is deemed to have ‘actually worked rather well’.215

208

COM (96) 462 final. Other areas pointed out for measures in the same document are cross-border access to health care, notably with a view to permitting greater and more efficient use of existing facilities, especially in border regions; the co-ordination of taxation in the light of co-ordination of social security; and co-ordination at the European level for supplementary pension schemes, particularly with regard to those Member States where occupational schemes play an important role in social protection. 210 See A Numhauser-Henning, above n 196. 211 Numhauser-Henning considers it to be the most prominent example of piecemeal reform: ibid, at 197. 212 Recommendations for the simplification of Reg 1408 have also been made by the SLIM team. SLIM signifies the Commission’s initiative entitled Simple Legislation for the Single Market Initiative, launched by the Commission in 1996; see COM (97) 102 and COM (99) 88 final. 213 See ch 4. 214 COM (97) 102. 215 M Moore, ‘Freedom of Movement and Migrant Workers’ Social Security: An Overview of the Court’s Jurisprudence 1992–1997’ (1998) 35 Common Market Law Review 409, at 455. 209

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Concluding Remarks 63

CONCLUDING REMARKS

The discussion in this chapter has shown that the grounds of social security protection in different Member States of the European Union differ depending on the model to which each system belongs. A classical division of welfare states suggests the existence of two main models, namely employment-based systems, where social security is based on the pursuit of an economic activity; and residence-based systems, where residence within the national territory of a Member State is the ground of social security protection. These two grounds have been used even in international social security law, although economic activity has been the most usual and, consequently, the most important. Residence within the territory of one of the contracting states has been used only within the framework of the Nordic Convention on Social Security. Regulation 1408/71 was based on the principles of pre-existing international social security law. Nevertheless, the social security law of co-ordination of the European Community is considered today to be sui generis law. It is employmentbased, but the accession of Member States with residence-based systems has put pressure on the dominance of the employment basis. Regulation 1408/71 has adopted the same technique of co-ordination, developed in the pre-existing international agreements and conventions, grounded on four fundamental principles: the principle of non-discrimination on grounds of nationality, the principle of the application of one legislation, the principle of aggregation of qualification periods, and the principle of exportability of benefits. During the time Reg 1408/71 has been in force, tremendous changes have occurred in all areas of public and private life. Labour market changes, family changes and demographic changes, most often inextricably intertwined with each other, challenge social security and raise the question of adjustment of the systems to them. Rising and lengthy unemployment, the emergence of atypical forms of work, female employment, new forms of cohabitation, increasing rates of divorce and longer life expectancy are some of the main changes that have significant consequences for the field of social security. Some schemes, like old age schemes, are under severe pressure. The need to develop new schemes and new forms of protection under these new conditions is underlined on many levels. Within this context, one new social risk, the risk of dependency in old age, has been conceptualised, while attempts are made to cope with the other scenarios within the framework of the established social security risks. The adjustment of Reg 1408/71 to the new conditions has long been a concern. The simplification of the Regulation has been seen as a separate issue or as part of the task of modernising it. Other important issues raised within the framework of the discussions for the modernisation of Reg 1408/71 have been the narrowness of its personal and material scope, and the effectiveness of its fundamental principles. Some changes in the labour market and migration patterns, in particular posting and pre-retirement, attracted special interest, along with issues concerning the

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64 Social Security in General provision of health care in another Member State. On the other hand, changes following the feminisation of the labour market and the emergence of the new type of worker who has to combine work and family—the worker-carer—as well as changes in family structures have not yet attracted any significant attention. Lately, a new Regulation was adopted in response to pressures for simplification and modernisation. The new Regulation is largely based on the same techniques and principles of co-ordination; however, some significant differences exist between the new Regulation and Reg 1408/71.

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2 Social Security and Gender INTRODUCTION

This chapter discusses social security from a gender perspective, mostly at the national level, as this is where the relationship between social security and gender has attracted the most attention. The main topics explored are: the relationship between women and social security, in both historical and present day contexts; the differences in how the national social security systems have coped with issues concerning women; and the different gender models of social security existing today within the framework of the European Community. This is followed by a focus on the gender aspects of certain current problems and perspectives of social security. The relationship between women and social security in a historical context is discussed first. Particular attention is paid to the impact that certain important factors, such as feminist theories and demographic anxieties, may have had in shaping social security schemes, and the final forms these systems assumed. Emphasis is placed on the issue of the criteria that women must fulfil in order to be covered by a social security system. Our focus then turns to the present relationship between women and social security. The differences among the national systems with reference to gender are discussed with the help of gender typologies of the welfare state. Even in this context, emphasis is placed on the different criteria that women must fulfil in the different systems in order to be covered. The discussion then focuses on current gender problems arising in the area of social security. Finally, a few words are said about the relationship between women and international social security law. The discussion of the relationship between gender and social security in this chapter has a twofold aim: first, to highlight the differential treatment of women in different national systems owing to the different assumptions embedded in the systems, which may result in legal gaps jeopardising the protection of migrant women, thus making action at inter-state level necessary; and second, to highlight the relationship between gender and the social security law of co-ordination hitherto and thus to determine the point of departure for this book as regards its gender perspective .

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66 Social Security and Gender

I. WOMEN AND SOCIAL SECURITY IN A HISTORICAL CONTEXT

The issues discussed in this section refer to the gender aspects of the two main models of social security systems discussed in the previous chapter, as well as to the impact of feminist theories and demographic anxieties in shaping modern social security systems.

1. Gender Aspects of Social Security Schemes The classical or typical division of social security systems is into two groups or models. The division is made on the basis of whether entitlements to social security are confined to categories of the active population, or whether they are conferred to the entire population within a country’s national borders.1 The gender aspects of these two main models are discussed in the following sub-section. 1.1 Women and Work-based Schemes Social insurance emerged, as already stated, out of the need to provide the average industrial worker with protection in the case of loss of income. From the outset the schemes were created around a certain number of social risks, ie professional injury, occupational diseases, sickness, invalidity and old age. They were thus mainly oriented towards men—men in industrial employment—and the alleviation of problems experienced by the active male labour force.2 Risks relating particularly to women which bring about a loss of earning capacity, such as maternity, were not at first encompassed by the schemes. When maternity protection schemes encompassing obligatory leave were introduced, they often entailed a loss of earnings for the period of leave. Thus, despite the fact that the whole idea of social security was the maintenance of earnings in periods of incapacity to work, maternity protection systems entailed a loss of income.3 1

Above, ch 1, at I, 3. Bock and Thane argue that the indirect impact of social security schemes was to reinforce women’s dependency on their husbands, who benefited from the welfare measures, and, hence, also reinforced the gender gap in terms of income and (relative) poverty. See G Bock and P Thane (eds), Maternity and Gender Policies, Women and the Rise of the European Welfare States, 1880s–1950s (London and New York, Routledge, 1991), at 4. 3 In Germany, mandatory maternity leave of three weeks after childbirth for factory workers was introduced by law in 1878, but it entailed a loss of earnings as the leave did not entail any form of compensation. Maternity benefits were included in the health insurance act of 1883, but payments were optional and dependent on the discretion of the sickness funds. See I Stoehr, ‘Housework and Motherhood: Debates and Policies in the Women’s Movement in Imperial Germany and the Weimar Republic’ in G Bock and P Thane (eds), above n 2, at 223. There was originally no specific law to protect maternity in France. Medical assistance was given to pregnant women on the basis of a law from 1893, which classified pregnancy as sickness—a fact that upset feminists. When a maternity protection law was enacted in 1909, it guaranteed the jobs of women who did not go to work for up to eight weeks before and after giving birth. However, this maternity leave 2

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Women and Social Security in a Historical Context 67 Maternity leave and benefits were introduced gradually at generally low compensation rates. Their introduction was often at odds with the prevailing assumptions about social security.4 The reason for this slow introduction of paid leave was that it was assumed that the husband’s wages were sufficient to cover family needs. The prevailing view of women—that they ought to be restricted to the private domestic sphere supported by their husbands—made it difficult to maintain that they were entitled to state support. In addition, the belief that social policies could not be permitted to undermine the responsibility of men to provide for their dependants inhibited the extension of social security schemes to women. It was believed that family responsibilities provided the greatest incentive for men to work, and it was felt that the payment of family allowances to mothers would lessen the responsibility felt by fathers.5 Even when maternity benefits were introduced, in many cases they were paid to fathers rather than to mothers.6 As stated in the previous chapter, the first social security schemes were based on the principle of insurance. The insurance principle—which also lies at the heart of was neither mandatory nor paid. It was only in 1913, after strong resistance and much agitation on the part of feminists, as well as the approaching war, that a mandatory maternity leave of four weeks was introduced. Soon afterwards, a specific law granted a daily allowance of between 0.5 and 1.5 francs, plus another halffranc for those who nursed their own children. These provisions covered all wage-earning women including domestic workers. Unemployed women were not covered by the provisions. The explanation for this as accepted by feminists was that the time was not yet ripe to demand too much from the state. In the same year, family allowances for necessitous families with many children, and certain categories of civil servants, were granted, but these monies were paid to the fathers; see A Cova, ‘French Feminism and Maternity: Theories and Policies, 1890–1918’ in G Bock and P Thane (eds), above n 2, at 126–9. In Sweden, the 1900 labour protection law provided that a woman who had given birth could not undertake any industrial work during the four weeks following the child’s birth, unless explicitly medically permitted. The law did not provide for any payments during this mandatory leave. Payments were finally provided for in 1931, when a maternity insurance law was passed. See A-S Ohlander, ‘The Invisible Child? The Struggle for a Social Democratic Family Policy in Sweden, 1900–1960s’ in G Bock and P Thane (eds), above n 2, at 60. See also R Eklund,‘Obligatorisk mammaledighet—nytt vin i gamla läglar’ in A Numhauser-Henning (ed), Normativa Perspektiv. Festskrift till Anna Christensen (Lund, Juristförlaget, 2000). Other countries followed a similar path. In Great Britain, cash maternity benefits for insured women, and for the wives of insured men, were introduced under the British National Insurance Act of 1911. In Norway, they were introduced under the Sickness Insurance Act of 1909. 4 In Sweden, for example, when social insurance was debated in the Social Democratic parliamentary group in 1926, it was defined merely as covering accident, sickness and unemployment insurance. The members of the group ‘distinguished themselves by their lack of interest in maternity and family policy problems’, although there were some Social Democratic politicians, both men and women, who pressed for a maternity insurance. See A-S Ohlander, above n 3, at 67. 5 I Ostner and J Lewis, ‘Gender and the Evolution of European Social Policies’ in S Leibfried and P Pierson (eds), European Social Policy: Between Fragmentation and Integration (Washington DC, The Brookings Institution, 1995), at 163; J Lewis, The Politics of Motherhood (London, Croom Helm, 1980), at 16 and 168. The fear that ‘feminism will free men first’ has existed all times and played a role during the early years of the welfare systems. In the eyes of certain feminists, it was one of the reasons for the ‘antifeminist backlash’, as they call it, of the 1980s. See J Stacey,‘Are Feminists Afraid to Leave Home? The Challenge of Conservative Pro-family Feminism’ in J Mitchell and A Oakley (eds), What is Feminism? (Oxford, Basil Blackwell, 1986), at 238. 6 An allowance paid directly to mothers staying at home to raise their children was introduced in France in 1939, and was greeted by feminists as a victory for their cause; see K Offen, ‘Body Politics: Women, Work and the Politics of Motherhood in France 1920–1950’ in G Bock and P Thane (eds), above n 2, at 146.

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68 Social Security and Gender all modern social security—presupposes the existence of a sufficient income based on a stable labour contract. That income enables the necessary pre-conditions for entitlement to benefits to be satisfied, namely the payment of contributions. The ideal norm therefore was a full-time industrial male employee with an uninterrupted history of employment. Another assumption, in addition to stable paid employment, was that the worker was the sole provider for his family’s economic needs. In addition, long-standing and stable family relationships within wedlock were assumed, forming the basis for derived rights for family members, mainly women. Women obviously did not fit properly within this insurance pattern. The capitalist societies in which social security emerged were characterised by a dichotomy between the public and the private sphere to an extent previously unknown. Women were confined to the private sphere.7 Labour was gender-based and genderdivided, with men employed in paid work outside the home, and women mainly responsible for caring and household duties performed in the home without payment. Women’s access to the formal labour market and paid work was not only limited, it also was restricted by law. The reproductive role and duties of women played an important part with respect to their limited access to the labour market. At this time, contraception was unknown or forbidden, and the possibility of women having control over their own bodies and reproductive capacities—including the right to abortion—was a highly controversial issue. Procreation occupied a significant part of a woman’s life. Frequent pregnancies and onerous household labour made additional outside work unattractive. Thus, women were unwilling to work if they did not need to, and the majority of women, irrespective of social class, supported the idea of a male family wage. It was only when the conditions of female paid and unpaid employment eased that this support faded.8 As to the legal restrictions, it should be noted that in some of the most advanced capitalist and welfare societies, the legal right of husbands to approve of their wives’ employment was not abolished until well into the 20th century.9 In reality, however, women engaged in paid work have always existed. The bourgeois family ideal of a male breadwinner and a female homemaker, although an ideal shared by men and women, trade unions and the state, was far from the reality for all women, particularly working class women.10 In fact, the bourgeois family 7 For a short summary of the position of women in traditional and modern societies, see AM Berggren, ‘Ett historiskt perspektiv på kvinnans ställning’ in E Aniasson et al (eds), Rapport från Kvinnouniversitetet: Vetenskap, patriarkat och makt, (Stockholm, Förlaget Akademilitteratur AB, 1983). For an account of women’s relations to work and family in the capitalist society, in particular with regard to Sweden, see C Carlsson, Kvinnosyn och kvinnopolitik: En studie av svensk socialdemokrati 1880–1910 (Lund, Arkiv avhandlingsserie 25, 1986), ch 2. 8 J Lewis and I Ostner, Gender and the Evolution of European Social Policies, Zes-Arbeitspapier Nr 4/94 (University of Bremen, Centre for Social Policy Research, 1994), at 14. 9 In Germany, for example, a husband’s legal right to prevent his wife from taking paid employment was not abolished until 1977; in France it came about in 1965. 10 The man’s salary was very rarely sufficient to sustain the family and the majority of working class families were more or less dependent on the woman’s income alongside the man’s. Many married women undertook washing, sewing or cleaning jobs, often on a seasonal or part-time basis, which permitted

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Women and Social Security in a Historical Context 69 ideal was never completely achieved. It has been argued that the male breadwinner model was operating at its height with respect to late 19th century middle class women or post-World War II wives of skilled ‘worker aristocrats’in a few industrialised countries.11 This reality was more or less ignored in several areas, especially in the social insurance context. Social security systems were not friendly to working class women. As the basic assumption was that women were—and ought to be— dependent, and that a woman’s work was of a secondary and complementary nature, no effective protective legislation existed for women workers in the labour market. Female work was ascribed a lower value and discrimination was legitimised.12 Outside marriage, women were the main recipients of poor relief grants and social assistance.13 The insurance principle was not appropriate due to low earnings and interruptions in work patterns, as well as erratic and uncertain income. During the second half of the 19th century, in addition to the issue of the working class in general, the situation of women was a particular concern. Social insurance emerged as a response to the fear of social unrest that the conditions of the working class might cause, as discussed in the previous chapter. The question of the status of women, on the other hand, was interwoven within a more complex set of issues: aside from labour market policies, it involved demographic anxieties, family policies, and feminist ideas. Thus, attempts to find a solution to the situation of women within the framework of the emerging welfare state only gave rise to more complicated questions. Women were involved in several roles beyond the limits of the labour market and paid employment. In particular, they performed domestic and caring work and had reproductive functions.14 Potential viable bases of social rights and entitlements could be as numerous as these roles. Most feminist movements in all Western European countries in the first half of the 20th century demanded recognition of women’s unpaid, and often invisible, work. This work, it was argued, should be a basis for social benefits paid directly to women. Women’s special traits and them to combine childcare with outside work. Such work rarely appeared in official statistics as it was not performed in factories or other industrial locations. See C Carlsson, above n 7, at 44–45. See also J Lewis, ‘Feminism and Welfare’ in J Mitchell and A Oakley, above n 5, at 89. 11 J Lewis and I Ostner, above n 8, at 18. 12 J Quataert, studying the case of self-employed handweavers in Germany at the end of the 19th century, offers an illustrative example of how male handweaving was recognised as ‘real work’, insurable under social security schemes, while female handweaving was considered supplementary, and therefore went uncovered. See JH Quataert, ‘Woman’s Work and the Early Welfare State in Germany: Legislators, Bureaucrats, and Clients before the First World War’ in S Koven and S Michel (eds), Mothers of a New World. Maternalist Politics and the Origins of Welfare States (New York, Routledge, 1993), at 173 et seq. 13 Despite progress in the direction of increased female participation in the labour market, women are still the main recipients of social assistance benefits. It has been pointed out that within the context of a dual social security model consisting of insurance and assistance, first-class insurance benefits go mainly to men and second-class assistance benefits mainly to women; see J Lewis and I Ostner, above n 8, at 17. As to the dual American system and its clients, see B Nelson, ‘The Origins of the Two-Channel Welfare State: Workmen’s Compensation and Mothers’ Aid’ in L Gordon (ed), Women, the State, and Welfare (Madison, University of Wisconsin Press, 1990). 14 As to the concept of work, and especially women’s relation to productive and reproductive work, see A Göransson, ‘Arbete och makt: en kritisk diskussion av begreppen arbete, produktion och produktionssätt’ in E Aniasson et al (eds), above n 7.

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70 Social Security and Gender capacities, conceptualised as ‘motherhood’ not in a biological but in a social sense, were proposed as an alternative basis for their social security and other welfare rights. In some cases, feminist demands for the recognition of women’s contributions to society went as far as including a wage for mothers. With regard to working class women compelled to work, feminists sought to improve their situation by demanding the introduction of legislation to facilitate combining paid work with reproduction. The most typical example of such legislation is maternity leave. However, whether feminist demands have had an impact on the formation and content of social security schemes as concern women is a matter of debate.15 In contrast, there seems to be no doubt that demographic anxieties played a decisive role in at least some Member States. Before taking a closer look at these two factors—the impact of feminism and demographic anxieties—the position of women in residence-based schemes will be examined. 1.2 Women and Residence-based Schemes Residence-based schemes stem from the philosophy of the Beveridge Report discussed in the previous chapter. Such schemes are considered to be more in tune with today’s ideals, as they provide the grounds for individual social security entitlements, although the low level of benefits is a matter of concern. The original aspiration of the Report, however, was not to provide everyone with individual entitlements—in particular not to married women whose route to social security was seen as going via their husband’s insurance. In the systems of universal social citizenship, residence-based schemes were soon supplemented by employment-based schemes.16 The systems today are subject to much criticism for consigning women to achieving only second-class social citizenship.17 This criticism is also directed towards the current individualisation trend, as discussed later in the chapter. Attention is given here to the gender critics of the Beveridge Report. a. Gender Aspects of the Beveridge Report The social insurance principle of the Beveridge Report rested upon three basic assumptions: full (male) employment; the one-earner family with a gendered division of labour between the male wageearner and female homemaker; and stability of the family with the unit being broken only by death. Family was, in Beveridge’s view, the most important institution for stability and for the development of individual personality: ‘The ideal unit is the household of man, wife and children maintained by the earnings of 15

Below, at 2.2. Above, ch 1, at I, 2.2 b. As to the ‘historical failure’ of citizenship to fully integrate and empower women and the feminist critique of social citizenship, see eg M Everson, ‘Women and Citizenship in the European Union’ in T Hervey and D O’Keefe (eds), Sex Equality Law in the European Union (Chichester, Wiley, 1996), at 210 et seq. See also A Leira,‘The “Woman-Friendly”Welfare State? The Case of Norway and Sweden’in J Lewis (ed), Women and Social Policies in Europe. Work, Family and the State (Aldershot, Edward Elgar, 1993). 16 17

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Women and Social Security in a Historical Context 71 the first alone.’18 The relevance of these assumptions was already questioned at that time. Beveridge considered marriage to be a partnership comprising different but equal partners, adhering, thus, to more modern and progressive ideas. In this idealised partnership with equality of status, husband and wife were a team. Each performed work of the same importance. The fact that wives were not gainfully employed did not mean that they were not engaged in vital and ‘equally important’ work, namely the performance of housework and motherhood. After the war, and against a backdrop of low birth rates, it was considered important to encourage women to take motherhood seriously. Thus, the idea was that married women should return to their full-time roles as housewives and mothers.19 Beveridge did not expect that the wartime trend of married women taking paid employment would continue after the war. He assumed that married women themselves would not wish to go on working for pay as they would be busy as housewives and mothers. He thus advocated maternity benefits high enough to ensure that women stayed at home and did not return to work too soon. Since his starting point with regard to married women was that they acquired ‘a new economic and social status’ by marriage, he recognised them as ‘a distinct security class requiring provision for risks peculiar to themselves—the economic risks of marriage’.20 The end of the marriage through the death of the husband, desertion or legal separation, brought an end to the wife’s legal right to maintenance by her husband. Such premature ends to marriage were seen by Beveridge as an essential contingency. He proposed a pension until 60, with higher additions if widowhood began after the age of 55, or if there were children, and full status within insurance.21 Caring responsibilities of wives and domestic spinsters—spinsters caring for their old parents—were left outside the insurance system as not fitting into its contributory principle.22 Incapacity to perform household duties was dropped as a contingency as ‘neighbourly and family help should meet such cases’.23 Thus, if married women were given a place in the social security system because of their ‘equally important’duties, unmarried women and women outside the labour market, due to their caring responsibilities for a relative, were paid no attention at all.24 18 Cited in H Glennerster and M Evans,‘Beveridge and his Assumptive Worlds: The Incompatibilities of a Flawed Design’, paper presented at the International Conference Social Security: 50 years after Beveridge, University of York, 27–30 September 1992, Vol 1, at 24. 19 Ibid, at 25. Beveridge’s conception of motherhood was interwoven with his population concerns. Assuming a declining birth rate, he was also concerned about a growing problem of paying for welfare. 20 Ibid, at 27. 21 Ibid, at 28. 22 Ibid. 23 Ibid, at 27. 24 The self-employed, part-time workers, the permanently unemployed, young school leavers, disabled people, single mothers and, generally, the growing group of people who had never been and were unlikely to be regular contributors, were other groups who did not fit into an insurance scheme. In this way, the principle of universality was undermined from the beginning. See B Abel-Smith, ‘The Beveridge Report: Its Origins and Outcomes’; and P Baldwin, ‘Beveridge in the Longue Durée’, papers presented at the University of York conference, above n 18, Vol 1, at 12 and 37 respectively.

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72 Social Security and Gender The Report as seen through modern eyes can be viewed as giving women a bad deal. Based on the presumption that married women are, and should be, dependent on their husbands, as a part of a team, they were not put on the same footing as men, even when they were in paid employment. Women who continued to work after marriage were to receive only about 75 per cent of the usual rate of sickness and unemployment benefits, even if they had earned the right to a full rate before marriage. Their pensions were cut to about 60 per cent of the rate paid to men or single women, meaning that their own contributions could only entitle them to a further 40 per cent of the male rate. The Report has been criticised for failing to treat women as full and independent citizens, and for privileging ‘citizen the worker’ over ‘citizen the mother’.25 Furthermore, it has been pointed out that the ‘standard employment relationship’ at the heart of the Beveridge model is essentially a male standard. The basing of social citizenship on employment and the ability to pay contributions has been criticised for consigning women to second-class citizenship. Squires notes that the commitment to full employment that Beveridge insisted upon was understood in purely masculine terms.‘The citizenship that men earned, the citizenship that their wages paid for, and the citizenship aspirations that beckoned to them in the career structures, housing markets and car showrooms of the developing consumer culture all served to further ostracise women economically, politically, culturally, even psychologically, from the public spheres of welfare capitalist society.’ He adds: ‘Resting the promise of citizenship upon the broad shoulders of the working man in full employment, secure in his own home, comfortable with his wife and family and fully provided for by a benevolent democratic state was quite unsustainable.’26 On the other hand, the Beveridge Report gave women a lot of credit for their role as mothers and housewives. Beveridge stressed that housewives were not to be treated as dependants of their husbands ‘but as partners sharing benefit and pension when there are no earnings to share’, and that this partnership was based on their ‘other duties’.27 The Report also discussed the need for better services to support women in their role as wives and mothers, such as better housing, domestic help and financial support.

2. Social Security and Feminism Feminist theories addressed the issue of social security protection for women; their impact in shaping social security systems, however, is questioned. These issues are discussed in the following sub-sections. 25 R Lister, ‘She has other Duties—Women, Citizenship and Social Security’, paper presented at the University of York conference, above n 18, Vol 5, at 16. 26 P Squires,‘Of Benefit to Citizens’, paper presented at the University of York conference, above n 18, Vol 2, at 9. 27 R Lister, above n 25, at 15–16. Thus, many women welcomed the Report for its recognition of the value of married women’s unpaid work.

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Women and Social Security in a Historical Context 73 2.1 Feminist Theories: Maternalist and Individualist Arguments Women’s movements emerged with the advent of the bourgeoisie and the bourgeois state. Organised women’s clubs already existed during the years of the French Revolution, but they were doomed: the state forbade them and their leading figures were executed. The ideas, however, survived and developed in both liberal and socialist contexts. The basic starting point of feminist analysis is female subordination to male dominance in a context that in the Anglo-Saxon feminist discourse is termed ‘patriarchy’.28 The feminist movement and its theories challenged the masculine hierarchy, attempting to change the conditions of women in a range of fields, by granting them rights that the patriarchy denied them. Feminist claims included a variety of issues referring to economic, civil and political rights, such as educational opportunities for women, admission into the professions, economic self-reliance, the right to paid employment and the valuation of women’s unpaid work, changes in patriarchal family law, the control of property, the right to vote, and access to public affairs and public office. They also included demands that women have control over their own health and bodies, for birthing and child-rearing practices, and for state financial aid to mothers and day-care centres for children. Thus, social rights were only one aspect of feminist demands. The most representative issues were perhaps the vote and entry into male-dominated professions and institutional hierarchies.29 In the 21st century, the common perception of feminism centres on the perspective that the primary path to the liberation of women is through work outside the home, contraception and abortion.30 Although all feminists agreed on the main analysis of female subordination and the need for change, they differed radically as to their ideas about how to achieve this goal. The appearance of a plethora of epithets such as ‘conservative’, ‘radical’, ‘liberal’, ‘social’, ‘Marxist’, ‘Christian’, ‘socialist’, ‘familial’, ‘bourgeois’, ‘old’, ‘new’‘firstwave’, ‘second-wave’, ‘classical’, and ‘modern’ prefixing the word ‘feminism’ is indicative of a significant plurality of substantial and historical forms of feminism. Today’s most common perception as to feminism, however, is that of a theory and/or movement concerned with advancing the position of women through the recognition of equal rights with men in the political, legal and economic spheres.31 Two main theoretical lines, contradictory and apparently incompatible with one another, developed with regard to the issue of the emancipation of women. Both advocated equality between men and women but on different grounds. One emphasised the similarities between the sexes, the other the differences. The former 28

As to the concept of ‘patriarchy’ in relevant literature, see A Göransson, above n 14, at 225; C Carlsson, above n 7, at 24–25. 29 K Offen, ‘Defining Feminism: A Comparative Historical Approach’ (1998) 14 Signs: Journal of Women in Culture and Society 119, at 123; R Delmar, ‘What is Feminism?’ in J Mitchell and A Oakley (eds), above n 5, at 21. 30 G Bock and P Thane, above n 2, at 7. 31 K Offen, above n 29, at 123. Style of dress, looks and ways of behaving are also contained in today’s popular approaches to feminism. See R Delmar, above 29, at 8.

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74 Social Security and Gender is usually called equality feminism, the latter maternalist feminism. Offen describes this schism as follows: ‘the feminist family tree stands revealed as a two-forked tree, with many smaller branches.’ Equality or individualist feminism32 posited the individual as the basic unit of society and social organisation. It downplayed or dismissed as insignificant all arguments about sex-linked qualities and contributions, including childbearing and its attendant responsibilities, emphasising individual human rights and personal independence in all aspects of life. It is based to a significant extent on American individualist approaches and the work of John Stuart Mill.33 Individualist feminism particularly served the cause of single emancipated women. During the 19th century there were a large number of single women, in particular in England and the United States, as a result of unprecedented middle class prosperity.34 Maternalist feminism, on the other hand, proposed a gender-based but egalitarian vision of social organisation, praising the companionate, non-hierarchical, male-female couple as the basic unit of society. The emphasis with regard to women’s rights was placed on the specific capacities of women, principally childbearing and nurturing. Their rights and claims on the common wealth were to be based on their distinctive contributions in these roles. Motherhood was seen as one of the qualities that constituted the ‘difference’of the female sex. However, it was not only perceived as physical motherhood, nor was it argued that all women should have children, or that they should take on an exclusively nurturing role, or that this was the role that women should play for all time. Motherhood was also perceived as ‘social’ or ‘spiritual motherhood’,35 which was to be understood as the caring activities of women who did not necessarily have children of their own, in professions such as social work and health care. Some feminists demanded that women be paid by the state for their work as mothers, in the form of a ‘motherhood endowment’ or a ‘mothers’ wage’.36 Thus, the central analytical point of maternalist feminism was that there were both biological and cultural distinctions between the sexes. While it viewed the collective situation of women as unjust, owing to the 32 This summary of these two historical modes of feminist thought is based on K Offen’s article, above n 29. See also N Cott, ‘Feminist Theory and Feminist Movements: The Past before Us’ in J Mitchell and A Oakley (eds), above n 7;Y Hirdman, ‘Mellan likhet och särart – kvinnorörelsens historia il ett annat perspektiv’ and U Broman, ‘Kvinnomedvetande och utopi: några radikalfeministika tankar’, both in A Aniasson et al (eds), above n 5. 33 D Rhode,‘Feminist Perspectives on Legal Ideology’ in J Mitchell and A Oakley, above n 5. 34 The family status of feminist activists is considered by many authors as a factor of crucial importance for the dominance of either individualist or maternalist arguments. The prevalence of maternalist ideas in the German Social Democratic women’s movement, for example, is attributed to the fact that it was mainly married non-working women who were active in the movement. They were married to organised Social Democrats, who often formed en elite within the working class. Thus, the emergence of a strong Social Democratic women’s movement is itself seen as part of the evolution of a ‘respectable’ elite within the working class; see C Carlsson, above n 7, at 54. 35 G Bock and P Thane, above n 2, at 8 and 14. 36 Others, however, rejected the idea. Some saw an expression of excessive ‘individualism’ in such claims; see I Stoehr, above n 3, at 214; S Pedersen,‘Catholicism, Feminism, and the Politics of the Family during the late Third Republic’ in S Koven and S Michel (eds), above n 12, at 262–3.

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Women and Social Security in a Historical Context 75 social and political institutions established by men, which could only be changed by protest and political action, it nevertheless insisted that women had a special and distinct role from that of men. This view developed into the doctrine of ‘equality in difference’, or equity as distinct from equality. Maternalist feminism called for government action to support and enhance women’s performance of their procreative functions, and at the same time it argued for the availability of other options. It demanded the right for women to work outside the home, to participate in all professions, to have equal access to formal education, to vote and to have equal civil rights concerning property. In the area of the welfare state, maternalist feminism made influential efforts to force the state to take the steps considered necessary to serve women’s needs as wives and mothers, for instance through payment of family allowances to mothers themselves; statesponsored maternity benefits and the enactment of protective legislation for women workers; improved housing, etc. All in all, these two forms of feminism led to very different interpretations of women’s circumstances and needs, especially as concerns state action on behalf of mothers. Both attempted to facilitate combining paid employment with reproductive and caring duties. Maternalist feminism supported the introduction of measures to alleviate the suffering of working women, such as maternity leave and maternity benefits. Beyond the limits of the labour market, they demanded recognition of women’s unpaid work, supporting family allowances paid directly to women and in some cases even a ‘mother’s wage’.37 For maternalist feminists, employment in the labour market was a right, but they did not see it as the only path to women’s emancipation. As already noted, paid work was not an attractive option for women at the turn of the century. Onerous household labour and frequent pregnancy, combined with engagement in paid labour, caused them to be pitied by those around them.Working women would leave the labour market upon marrying if they could afford it. It was not until later—indeed, not until the 1960s, when both housework and the labour market underwent significant changes—that outside paid work became attractive. For individualist feminists, on the other hand, participation in the labour market was indispensable for the liberation of women.38 Domestic work, by impeding women’s equal participation in the public sphere,39 was identified as the main focus of female oppression. They thus put the emphasis on increased welfare services on the part of the state—mainly day-care centres—in order to facilitate women’s entry

37 Demands for welfare benefits rewarding women for their caring and homemaking role have never actually been completely abandoned In the 1980s, many Canadian feminists campaigned vigorously for ‘homemakers’ pensions’, and called explicitly for the recognition of the work women do in the home. At the same time, studies showed that the majority of carers themselves believed that they were the right person to provide care; see J Lewis, above n 10, at 97. 38 For reflections on the effects in the labour market and elsewhere with respect to the steep rise in female employment from a 1960s feminist’s point of view, see J Mitchell,‘Reflections on Twenty Years of Feminism’ in J Mitchell and A Oakley, above n 5. 39 See also A Göransson, above n 14, at 228 et seq.

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76 Social Security and Gender in the labour market.40 Men’s attitudes came into focus, as women’s increased participation in the labour market increased engagement on the part of men in caring and household duties. Homemaking and child rearing were not seen as the road to self-realisation.41 Thus, this work should be equally divided between family members. Consequently, the impetus was that the dual-breadwinner family should become a dual-carer family as well.42 Maternalist feminism was the dominant line of argument throughout the Western world at the end of the 19th century and in the first half of the 20th century.43 Although it is usually associated with the bourgeois women’s movements, it was embraced not only by bourgeois feminist movements, but also by the 40 A point of debate and criticism has been the well-being of children. Critics argue that not much weight was given to children’s well-being in the debate on women’s liberation in the 1960s and the 1970s. Such arguments, emphasising the demoralising effects of female work on children, as well as on women, were dominant in earlier periods. Facing the challenge of ‘conservative pro-family feminism’ in the 1980s, ‘liberationist’ feminists acknowledged that theories of child development were underdeveloped by the feminist liberation movement of the 1960s, and underlined the need for more developed feminist theories on the topic: ‘Resenting the trans-historic female responsibility for unilateral nurturance of children, and perhaps fearing, and thus denying a bit too hastily, the possibility that the needs and interests of contemporary women and children may not be fully compatible, feminist theorists have tended to neglect the question of what children need’: see J Stacey, above n 5, at 241. The discussion is still ongoing. Ostner notes that the most sophisticated and elaborate argument arose as a result of West German individualisation, namely that the family consists of individuals with different needs. Each individual, including children, strives for an optimal matching of his or her needs for self-realisation. Consequently, the child needs at least one person’s continuous attention. Recent discussion of this subject revolves around the incompatibility of self-realisation with ongoing social obligations such as taking care of someone. Ostner sees in that a potential explanation for women’s reluctance to have—if any—more than one child. See I Ostner,‘Ideas, Institutions, Traditions: The Experience of West German Women, 1945–1990’ in (1991–2) German Politics and Society 87. In general, however, and this is not at all surprising, opinions on what is considered best for the children have varied widely among the various European countries. In Germany the opinion held by educators, paediatricians, and both the Catholic and Protestant Churches has been that a young child needs its mother to be with it all times and that any separation is traumatic for the child. In France, for instance, the early socialisation of young children is not only accepted, it is regarded as being of social value; see J Fagnani, ‘Family Policies and Working Mothers: A Comparison of France and West Germany’ in MD García-Ramon and J Monk (eds), Women of the European Union. The Politics of Work and Daily Life (London, Routledge, 1996), at 132. 41 The paradox is that while the self-realising effects of childrearing were downplayed in the women’s liberation debate, they were emphasised in the effort to bring men home. In J Mitchell’s words: ‘It is interesting that after attacking the pedestal treatment of women as earth-mothers, after fighting and showing that we could do what men could do, we then discovered that for our vision of equality, we needed them to do what we could do. Motherhood and domesticity having been negatively appraised, we re-valued them. And so with the wrongs nominally righted, the way was open for the positive aspects of womanhood to be rediscovered. In discovering our values, we made the social and the psychological areas traditionally occupied by women fit for occupation by men—the home was a place for men to inhabit while the woman went out into the world of work—for the time being.’ See J Mitchell, above n 38, at 44. 42 The dual breadwinner/carer family model is still a topic of investigation and research. Research has shown that although the reluctance of men in sharing care and home responsibilities is often pointed out as a main factor in explaining the difficulties in realising the model, women’s resistance in conferring a portion or the entirety of such responsibilities to their partners may also form part of the explanation. Many women experience motherhood as a privilege, which they do not wish to share with anyone. In a publication by the Swedish National Social Insurance Board, for example, it was underlined that ‘it is not certain that it is easier for women to share the responsibility for children than it is for men to assume part of this responsibility’; see Riksförsäkringsverket, Socialförsäkringsboken 2003: Mamma, pappa, barn— tid och pengar, at 20. 43 See eg J Lewis, above n 5, at 222.

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Women and Social Security in a Historical Context 77 socialist women’s movement as well.44 It is considered to be typically European. Even though access to male privilege and power were undeniably important for women and men in Europe, Europeans sought other goals as well, and moreover they expressed their demands in considerably different ways from the AngloAmericans: ‘Europeans focused as much or more on elaborations of womanliness; they celebrated sexual difference rather than similarity within a framework of male/female complementarity; and, instead of seeking unqualified admission to male-dominated society, they mounted a wide-ranging critique of the society and its institutions.’45 Lewis and Ostner46 explain the dominance of maternalist theories with the prevalence of Christian Democratic, especially Social-Catholic, thinking on the European continent, which was anathema to the idea of a world which, like a market, was made up of similar independent individuals. Instead, the individual was seen as continuously embedded in vertical and horizontal relations with regard to gender and generation, such as child and parent, wife and husband, woman and man.47 According to Offen, the differences between these two modes of feminist approach were clearly articulated between 1890 and 1920. At the turn of the last century, individualist approaches took precedence in the Anglo-American discourse. The emergence of individualist feminism marked a paradigm shift in the struggle for the emancipation of women.48 In France, this individualistic and competitive form of feminism was considered to be a peculiarly Anglo-Saxon mutation of feminism and viewed as atomistic and, hence, socially destructive.49 It was even rejected as anti-French and, until the eve of the Second World War, feminism was closely associated with republican nationalism.50 Maternalist feminism gradually declined from the late 1920s, and in some countries it was even completely suppressed. The differences between these two strands of feminist discourse gradually began to be expressed in political terms. Organisations and parties to the right of the political spectrum continued to emphasise the difference between the sexes and to praise motherhood, while those on the left placed the emphasis on the similarities between the sexes, considering the main path to women’s liberation to be through 44

The paradoxical adherence of socialist women to maternalist feminist arguments is explained by the attraction of these arguments to most of the women. As Hirdman writes, for Sweden, the great influence of the maternalist ideas of Ellen Key (below, n 93) on women of all political beliefs is attributed to the attraction of her analysis of vital areas of female activity outside the labour market, such as sexuality and home; see Y Hirdman, above n 32, at 58 et seq. A different explanation is given by C Carlsson, above n 7. 45 K Offen, above n 29, at 124. 46 J Lewis and I Ostner, above n 8, at 10. 47 Ibid.As a part of this thought,‘a natural subordination of women in social relationships for the sake of the family and the society has been traditionally stressed’. 48 This had the result that many 19th-century feminists in all countries found themselves relegated to the camp of ‘antifeminism’; see K Offen, above n 29, at 146. 49 Ibid. As to feminist debates in general in France, England and other countries, see also E Badinter, XY: om mannens identitet (Stockholm, Forum, 1994; translated from French—original title XY. De l’identité masculine), at 20–40. 50 K Offen, above n 29, at 147.

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78 Social Security and Gender work in the labour market. Attempts have been made to find a middle way, such as that by the leading Swedish Social Democrat Alva Myrdal, who argued for women’s twofold roles: one as gainfully employed and one as a mother when children are small.51 After the Second World War, few feminists took up the earlier heritage and relational or maternalist feminism lost its appeal. Today, as Bock and Thane write, stressing motherhood as an important feature of many women’s lives often is seen as ‘traditional’, ‘conservative’ or even ‘reactionary’, in contrast with the actual or allegedly more modern activities of women. Escape from motherhood and the abolition of gender roles is often seen as true feminism.52 Since the 1980s, there has been a tendency in the feminist and academic discourse53 to re-evaluate the achievements and perform a historical restoration of this form of feminism, as well as an attempt to formulate a new definition of feminism.54 The excessive ideas of the 1960s and 1970s have been criticised, in some cases even by some previously prominent ‘liberationalist’ feminists.55 Others, while defending the correctness of those ideas and demonstrating their distaste for the conservative pro-family feminism of the 1980s,56 nevertheless were inclined to selfcriticism. For instance, they drew attention to the conflict women experience between their self-interest and their allegiance to the family—to husband, children and kin: ‘The task for feminists is to recognise that women relate to a much more complicated set of structures than men; to be sensitive to women’s conflicting loyalties; and to avoid making dogmatic claims on their behalf.’57 Critics point out that the current perception of feminism, as a theory in which the key is exclusively the ‘advancement’ of women through ‘rights equal to those granted men’, is inadequate from a historical point of view. It ignores the main stream of feminist thought developed up to the Second World War.58 It has also

51

Below, at c. G Bock and P Thane, above n 2, at 7. 53 In the academic discourse, the most severe criticism of current perceptions of feminism have come from historical researchers. A number of books have appeared, in which different writers have noted that the impact of maternalist feminism on the formation of welfare systems, especially in connection with women-related benefits, has been inadequately studied and principally underestimated. See G Bock and P Thane, above n 2, at 6. 54 Offen argues that a definition of feminism based on historical observations must include all peculiarities and nuances of the feministic argument in any given society. Such definition should emphasise that feminism is both an ideology and a movement for socio-political change, based on a critical analysis of male privilege and women’s subordination. See K Offen, above n 29, at 152–3. 55 The 1960s feminist movements aimed at the ‘liberation’ of women, in contrast with the earlier goal of ‘emancipation’; see J Mitchell and A Oakley, above n 5. 56 J Stacey, above n 5. 57 J Lewis, above n 10, at 86; D Rhode, above n 33, at 155. 58 K Offen, above n 29, at 123. See also C Register, ‘Motherhood at Center: Ellen Key’s Social Vision’ (1982) 5 Women’s Studies International Forum 599. Criticism has also been expressed in Sweden: see AM Berggren, above n 7, at 49; contra U Wikander, ‘Personal Historical Notes on Gender Distinctions; Inter Alia about Equality and Difference [likhet och särart]’ in K Ullenhag (ed), ‘Hundred Flowers Bloom’: Essays in Honour of Bo Gustafsson, (Uppsala, Uppsala Studies in Economic History 33, 1991). As to the notion of feminism, see also D Delmar, above n 29. 52

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Women and Social Security in a Historical Context 79 been maintained that there is an Anglo-American bias in the current perception of feminism.59 Explanations for the decline of maternalist arguments were sought in the glorification of motherhood and the excesses of Nazi Germany.60 Nevertheless, despite the ultimate prevalence of individualist feminism in general, forms of feminism varied widely between one society and another, and the grade of intrusion of the individualist arguments differed. In three countries of the European Union, for example, feminism followed distinct paths. a. German Feminism German feminism has been quite different from that in other European countries, mainly from one point of view: it has always been very reluctant to identify independence with employment.61 Indeed, egalitarian policies promoting full-time paid work for women, Emanzipationslogik, have never been attractive to most German feminists. The majority of feminists in the bourgeois and proletarian movements perceived women primarily as wives and mothers. Thus, they were first in favour of policies to better, humanise or even cultivate marriage and family life. At the beginning of the 20th century, they supported demands for a male family wage and for stricter protective legislation for married or pregnant women.62 The idea of ‘work’ was considered to ‘swallow’ the idea of women’s emancipation, and feminist arguments promoting this idea were criticised for neglecting or denying ‘the lust for a good life, for comfort if not luxury, for time to be wasted, not saved, for closeness and a space where money does not reign’.63 In the 1970s, when sweeping changes in the previous arguments and assumptions of women’s roles were taking place in most Western European countries, influential German feminists continued to insist that it is in the domestic sphere, in the mother-child dyad and daily activities at home, that the notion of such a good life is encompassed.64 Not surprisingly, the idea of female full-time employment was rather easily ignored in the 1980s.65

59 K Offen, above n 29, at 124. Foubert argues that even today the European Community and American legal systems are based on and promote different notions of equality. While the former is in favour of substantive equality, which pays attention to group subordination and is supportive of the idea of affirmative action, the latter has always supported a more formalistic approach to equality; see P Foubert, The Legal Protection of the Pregnant Worker in the European Community (The Hague, Kluwer Law International, 2002). 60 C Register, above n 58, at 609; Broman identifies the Nazi interpretation of maternalist arguments as one (extreme) interpretation of three possible logical choices; see U Broman, above n 32, at 182. 61 I Ostner,‘Women, Work and the Family in Germany’ in J Lewis (ed), above n 17, at 94. Around the mid-19th century, feminism in Germany was primarily liberal (equal rights, equal opportunities, equal wages). By the end of the century, a new vision of female emancipation stressing the particular nature of women had developed: see C Sachbe,‘Social Mothers: The Bourgeois Women’s Movement and German Welfare-State Formation, 1890–1929’ in S Koven and S Michel (eds), above n 12. Even Irish and Italian feminists have for the most part been reluctant to identify independence with employment; see I Ostner and J Lewis, above n 5, at 180. 62 J Lewis and I Ostner, above n 8, at 13. 63 I Ostner, above n 61, at 93. 64 Ibid. 65 Ibid, at 94.

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80 Social Security and Gender However, German feminism, like maternal feminism in general, did not reject women’s employment. It supported the idea of a mix of both paid and unpaid employment, although the questions as to the type of mix women wanted (simultaneous or sequential), and the type of policies needed, were far from settled. Nevertheless, the main point of the analysis is that the primary experience of women is as wives and mothers; their status as workers takes second place. German feminism has generally rejected the idea of citizenship based on an individual right to employment equal to that of men. Thus, policies have to be based on the difference, and unpaid and often invisible domestic activities should be publicly rewarded and compensated as a socially vital peculiar sort of work.66 However, the public reward of domestic activities should be acquired through social policies. These policies have little in common with the older feminist demand for ‘wages for housework’.67 The value accorded domestic activities is not only a feature of the ideology or movement of feminism in Germany. A majority of German women have themselves expressed the desire for a life revolving around housework, marriage and family. This has been pointed up and supported by statistics demonstrating that German women are reluctant to leave their homes and have men and children cared for by others,68 while public opinion readily identifies the image of the mother as a superwoman with that of a bad mother.69 In contrast with other European countries, where the Second World War is used as a fundamental explanatory factor for consequent changes with respect to attitudes and traditional gender roles, in Germany, although women were forced to be self-reliant during the war, no fundamental change in the gendered public and private division of labour occurred in the years after the war.70 Several reasons are mentioned for this. Ostner considers the lack of a positive model of the working woman, especially the working mother, up to the post-war period, to be a reasonable explanation. As she writes, many women experienced employment under restrictive and demoralising conditions;‘they were worn out and frustrated, and most of them longed for a rest and to return home to care for their often neglected children’. More important, according to Ostner’s argumentation, was the fact that the family was considered to be an important stabilising factor for post-war reconstruction in West Germany. The overwhelming support for Nazism, which virtually abolished self-regulated institutions and the private world of marriage and family, was attributed by influential personalities in the post-war years to the invisibility and weakness rather than strength of German fathers and husbands during the Weimar Republic. At the same time, concerns were 66

I Ostner, above n 61, at 93. Ibid, at 95. 68 Ibid, at 97. Care-giving was often women’s chosen preference in other countries as well, such as Australia, if such a choice was available; see L Gordon, above n 13, at 21. 69 J Fagnani, above n 40, at 132. 70 Women’s labour market participation increased, however, in the post-war years, mostly in relation to part-time work, and especially among the highly qualified. See J Schmude, ‘Contrasting Developments in Female Labour Force Participation in East and West Germany Since 1945’ in MD García-Ramon and J Monk (eds), above n 40, at 158 et seq. 67

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Women and Social Security in a Historical Context 81 expressed about the East German system—which, in the eyes of West Germans, by concentrating social policies on children and full-time working mothers, was close to repeating Nazi policies, albeit from a different perspective—creating a ‘fatherless society’. ‘Neither Nazi nor GDR’ was the slogan in West Germany in the years after the War. A strong patriarchal family was seen as a bulwark against communism and other forms of totalitarianism.71 Other authors attribute the prevalence of maternalist ideas to the dominance of bourgeois family ideas, norms and values over those of the working class.72 East Germany took a different path. Both in rhetoric and in policy, women were primarily regarded as workers. They were also counted as mothers and the common life pattern for East German women in the post-war years was that of a full-time working mother and part-time homemaker.73 Reunification was regarded by many feminists as a chance to accelerate changes in West Germany with regard to a range of issues, including women’s employment. Instead, the West German model of welfare, with its various gender divisions, seemed—at least initially—to be rapidly extended and strengthened.74 After reunification, it was shown that the different social policies and political discourses had shaped not only different women’s roles in the two societies, but also the various responses from women in terms of the way they patterned their lives, as well as through women’s movements. Chamberlayne noted with regard to the response of the two sides after reunification: ‘One puzzle and disappointment for women from East and West since 1989 has been the difficulty in achieving any sense of feminist unity.’ And elsewhere: ‘So far the common interest of women in East and West Germany in combating patriarchy has

71

I Ostner, above n 61, at 95–101. See C Sachbe, above n 61. 73 I Ostner, above n 40, at 87. 74 I Ostner, above n 61, at 92; E Hedlund, Kvinnornas Europa (Stockholm, Dagens Nyheters Förlag, 1993), at 123–33. The East German transition to a market economy was accompanied by rapidly increasing unemployment, which hit women in a different way from men. Women were no longer an attractive labour force in terms of new job opportunities, as they were now generally regarded as dependants rather than as workers in their own right. While the concept of the male breadwinner was unfamiliar to those born after the War, 50 per cent of female redundants in the labour market were made dependent on a male breadwinner, and childcare facilities were closed down (I Ostner, above n 61, at 114). Although no one really knew how men and women would react to this situation during the first years after unification, some expressed the view that women might not perceive their situation in terms of pure losses and no gains. The emancipatory effect of women’s integration into paid employment in the old East Germany was not undisputed. This integration had not overcome fundamental gender divisions, neither had it occurred on equal terms with men. The problem of combining parenthood with paid work had not been satisfactorily solved and women’s economic independence had not given them an easier time. Some psychologists argued that, despite childcare facilities and generous entitlements to time off, the result was often self-exploitation and estrangement of many mothers from their children, who were often apart from them for 10 or even 11 hours a day. Thus, one of the reasons for the reduction in childcare programs after reunification was the fact that many women who became unemployed decided not to utilise childcare facilities but to keep their children at home, and as a result, the demand for childcare fell (B Martin, ‘The Impact of Restructuring of the Berlin Labour Market’, contribution to a workshop held in Bonn in November 1994, cited in European Foundation for the Improvement of Living and Working Conditions, Families, Labour Markets and Gender Roles. A Report on a European Research Workshop (Luxembourg, 1995), at 29). 72

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82 Social Security and Gender not produced unity, and neither side feels it has much to gain from the ideas and situation of the other.’75 Nevertheless, the salient feature of West German feminism in the 20th century, at least as supported by public opinion, was its ‘maternalist’ character, different more or less from all other countries of Western Europe. Although individualist approaches were not totally alien to German feminism and politics, there was a large degree of historical continuity in marriage and family policies, and in ideas and institutions from the end of the 19th century.76 b. French Feminism French feminism up to the Second World War was predominantly maternalist and pro-natalist. The dominant philosophy was that of ‘equality in difference’: motherhood was emphasised as a common bond for all women, as a social function and as the basis of their political, social and economic rights. Feminist demands covered a range of issues, from public recognition of female and motherly values and work to a mother’s wage. Some feminists even included the right of mothers to go on strike.77 Arguments of a maternalist character were supported by women’s movements in all areas of the political spectrum, from secular right movements and social Catholics78 to socialist and communist women’s movements. At variance with the long-standing international socialist commitment to women’s employment as an essential condition for their liberation, many French socialist women were of the view that socialism would restore women to their rightful place in the foyer, after capitalism had ‘snatched them from their homes and children, abandoning babies to mercenary care, abandoning husbands to hearths where sweetness no longer prevailed, and generally breaking the bonds of the family’.79 Support for maternalist feminism existed even in the communist party. The position of the French section of the Communist International on the women question, which in the 1920s had followed 75 P Chamberlayne, ‘Women and Social Policy’ in J Clasen and R Freeman (eds), Social Policy in Germany (Hertfordshide Harvester Wheatsheaf, 1994), at 173 and 188 respectively. Ostner, on the other hand, gives a different account of the meeting between West German and East German feminists. According to her, East German women did not seem to be particularly impressed by the prospect of economic independence at the cost of losses in the field of personal relationships. In a way, they appear to be more eager to again raise issues surrounding the particular qualities found in personal and caring relationships, in ‘love or the uniqueness of the mothering experience’. Thus, while many West German feminists were eager to promote female employment as a means of emancipation, there was evidence of an opposite trend in East Germany (I Ostner, above n 61, at 115). 76 I Ostner, above n 40, at 88. 77 N Roussel, a ‘radical’ feminist who defended women’s right to voluntary motherhood and to their bodies, demanded that mothers be recognised as workers performing ‘maternal labour’ and who therefore had a right to go on strike:‘She proclaimed a “strike of the womb”, understood as a struggle to obtain rights and payment for mothers; such a “just wage for the noble work of maternity” would allow those women who so desired to dedicate themselves to their motherly tasks’; see A Cova, above n 3, at 128. 78 On social catholic views in the feminist discourse see S Pedersen, above n 36. 79 K Offen, above n 6, at 147–9. The idea that it was capitalism that removed women from their homes, and that socialism would restore women as well as families to their rightful place, was not typically French. Socialist parties in other European countries were in favour of it as well. For more detail see C Carlsson, above n 7, at 55 et seq.

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Women and Social Security in a Historical Context 83 the Soviet-Russian line on women’s liberation through outside paid work, switched abruptly in 1934 to a focus on ‘bonheur familial et maternal’.80 The second trait of pre-war French feminism was its pro-natalist character. Demographic problems intensified in France after a significant decline in the birth rate which had begun in the 1870s, and these problems haunted the public authorities, since they feared an invasion from Germany.81 Some writers point out that the feminist strategy as a whole was to utilise the apparent demographic danger and the glorification of motherhood as a weapon in the struggle for the rights of mothers. As Maria Martin, editor of the Journal des femmes, put it in 1896: ‘If you want children, learn to honour the mothers.’82 After the First World War, women outnumbered adult men. The issue was how to combine employment and motherhood. The employment situation of women in the inter-war period and in the context of a sharp demographic problem was somewhat peculiar. On the one hand, France had the highest percentage of women in the labour force, including those working in agriculture, of all economically developed countries. After the First World War, women were needed as industrial labour, and this need led to the enactment of laws that facilitated the combining of employment and maternity.83 On the other hand, after the end of the war, hundreds of thousands of women were released from the French labour force to make room for returning men and attention was shifted to countering the still-falling birth rate. At the same time, child specialists and doctors, together with feminists, proclaimed that ‘the mother is the one who nurses her baby’.84 As the world economic situation deteriorated and the depression of the 1930s brought massive unemployment to Europe, a working wife was seen as a ‘problem’ by pro-natalists and the familial movement.85 However, unlike other governments, the French government continued to support women’s right to paid employment.86 At the same time, though, it enacted sex-specific protective legislation and promoted a certain vision of sexspecific male and female roles through public education.87 The years after the Second World War, and especially the 1960s, marked a paradigm shift in French feminist thought. Individualist theories, developed in the United States, were espoused by French feminists in their campaign for women’s emancipation and liberation from male oppression. Domestic work was identified as the seat of oppression and as the condition common to all women regardless of their socio-economic status. Within this perspective, forms of welfare which gave 80

K Offen, above n 6, at 147–9. Ibid, at 140. See also A Cova, above n 3, at 119. A Cova, above n 3, at 119; A Klaus, ‘Depopulation and Race Suicide: Maternalism and Pronatalist Ideologies in France and the United States’ in S Koven and S Michel, above n 12, at 194. 83 A Cova, above n 3, at 132. 84 Ibid. 85 K Offen, above n 6, at 143. 86 In 1917, a law was enacted providing that mothers working in industry should get time off for the purpose of nursing, for one hour a day during working hours in the course of the first year after childbirth: A Cova, above n 3, at 132. 87 K Offen, above n 6, at 140. 81 82

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84 Social Security and Gender priority to the reproductive function of women could be interpreted as reinforcing existing gender relations and thereby contributing to the oppression.88 During the 1970s and the 1980s, feminist movements and debates declined. It has been argued that by taking control of women’s rights and by introducing equal opportunities legislation, the state had pre-empted the women’s movement and appropriated its cause, just as the unions saw a reduction in their power as a result of the institutionalisation of state welfare. This is truer of the Socialist party, with the emphasis it placed on feminist issues, than it is of the parties to the Right and Centre, which have tended to downplay women’s rights as workers in favour of motherhood.89 c. Scandinavian Feminism: Sweden Scandinavian feminism is usually seen as a homogenous movement. A closer look at each individual country, however, reveals that women in Scandinavia also disagree among themselves as to what is best with respect to motherhood and childcare, access to the labour market and women’s participation in politics and public life. At the outset, the Swedish feminist movement included both of the basic modes of feminist thought, namely equality based on sameness and equality based on difference. Those two trends were represented in the feminist movements at both ends of the political spectrum, that is to say the women’s movements of the Right and those of the Social Democrats.90 However, feminist ideas as to difference became stronger in all the movements across the political spectrum. Hirdman points out that even Social Democratic women were more enthusiastic about this mode of thinking,91 despite the socialist theory that economic independence through the labour market was the only way to achieve women’s liberation.92 This somewhat surprising deviation by Swedish Social Democratic women from socialist theories, according to Hirdman, is due in large part to the influential ideas of Ellen Key.93 Key’s analysis concerning the areas of home and sexuality, two 88 L Hantrais, ‘Women, Work and Welfare in France’ in J Lewis, above n 17, at 121. Arguments insisting on women’s difference were later promoted in the post-1968 French mouvement pour la liberation des femmes, by a group known as Psych et Po (Psychanalyse et Politique). The focus, though, shifted from procreation and mothering to sexuality and separatism; see K Offen, above n 29, at 148. 89 L Hantrais, above n 88, at 124. 90 Y Hirdman, above n 32. 91 Ibid, at 55 et seq. 92 Ibid. The theory was primarily developed in Clara Zetkin’s early scripts, which view women primarily as workers, employed at what they had interest in and talent for, while children would be left totally as society’s responsibility. Women, pursuant to this view, were not automatically proper carers of children because of the mere fact that they brought them into the world and nurtured them; the task of bringing up children should be left in the hands of specially educated personnel. See also C Carlsson, above n 7, at 60 et seq. 93 Ellen Key was the leading figure in Swedish feminism at the beginning of the 20th century. Unmarried and childless, the daughter of a leading liberal politician and liberal herself, she advocated a new world-view based on social solidarity, the ‘self-assertion and self-surrender’ of the mother-child relationship, and a transformation of society that would place motherhood at the centre of public life. She insisted on the difference between women and men, and demanded freedom for women to be true to their own character rather than follow patriarchal definitions or emulate male behaviours. She contested ‘women’s cause fanatics’ for contenting themselves with dominant values and emulating men in the pursuit of academic degrees, positions in banks and offices, and lives unburdened by children. Their

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Women and Social Security in a Historical Context 85 important spheres in women’s everyday lives and activities, held particular attraction. These spheres were left out of both the liberal and Marxist analyses, which focused on only one aspect of female existence: the labour market.94 The paradigm shift from the ideology of difference to the ideology of sameness with the resulting focus on women’s participation in the labour market occurred in the inter-war period. It was embraced by both the Social Democratic and the Right women’s movements. Despite the economic crisis of the 1930s and men’s explicit resistance to women’s paid work, the theories of economic independence as the only path to emancipation were revived. Women began to demand the right to paid work.95 Two of the main actors behind this shift were the Social Democrats Alva and Gunnar Myrdal. In their book Kris i befolkningsfrågan,96 they developed the idea that because of the structural changes brought about by industrialism in a range of areas, including social and family life, more and more women would turn to the brains, she said, were ‘hermetically sealed’ to all but legal and intellectual liberation. Her point was that ‘it is only by making the essence of her being the departure point for her striving after liberation that a personality becomes really free, not only from something but also for something’. She dismissed arguments that limited women to masculine standards. She sought a re-evaluation of motherhood as a socially important function—as women’s ‘highest cultural task’—and she tried to enlarge the scope offeminist thought by bringing private issues into the public consciousness, and by assigning public social and economic value to work done in the private sphere. Her concept of motherhood was that of ‘social motherliness’, including the maternal inclinations of all women, irrespective of whether they had children or not. In that concept, she saw the power to transform a society beset by exploitation, war and social hypocrisy. She believed that the sexual division of labour had been helpful in the sense that it had given women space to develop a special character distinguished by tenderness and empathy. She also believed that what women had learnt in their private life should now, in turn, be taught to the public. Key did not oppose paid work for women, but she did not see it as a vital expression of women’s liberation. She regarded it as an illusory freedom, which often required the abandonment of motherhood and even sexual life. She proposed publicly-financed payments for mothers raising children. Backed up by Reports on the dangers of substances such as white lead to childbearing women, she supported protective labour legislation for working women. Despite her preference for the home, she acknowledged the demoralising effects of such a choice on many women. The way to alleviate this suffering, she believed, was to ascribe public social value to raising children. Society should be held responsible for children’s economic support, and for rewarding, simultaneously, the mother for her work. She proposed that, under some conditions, every mother should be entitled to her own support and half her children’s for at least the first year. The other half of the child’s support would be paid by the father, regardless of the child’s legitimacy. She argued for complete civil equality between husband and wife, for identical political rights both outside and inside the home, and for a woman’s right to retain control over her person, her name, her work, and her children. Children should bear both parents’ names. She also recommended settling disputes in the mother’s favour, at a time when husbands were the legal guardians not only of their children, but also of their wives. She distinguished between motherhood and marriage, and considered marriage as the institution mediating between the public and the private, as the lynchpin in a social order that kept women ineffectual in public life. Key’s vision included a new ethical system, where marriage was a potentially useful legal framework for cohabitation and child-rearing, but it was of no moral consequence and she extolled love, genuine love between equals who respect each other, as the crux of liberation. (This summary of Ellen Key’s work is based on the article by C Register, above n 58.) 94 Y Hirdman, above n 32, at 57 et seq. A different opinion, however, is expressed by Carlsson, who argues that it was the existence of conflicting interests within the Social Democratic party itself, rather than external influences, which lay behind this early embracing of maternalist arguments by Social Democrats. See C Carlsson, above n 7, at 55 and 275. 95 Y Hirdman, above n 32, at 66. 96 New edition by Bokförlaget Nya Doxa (1997). The book was first published by Albert Bonniers Förlag in 1934.

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86 Social Security and Gender labour market. Industrialism has entailed, according to the Myrdals, that the traditional family, which combined a productive and a consumptive function, was reduced to a merely consumptive unit. In the traditional family, in which women were just as indispensable for production as men, reproduction was not a hindrance to women’s productive work. When production was removed from the home, however, it became impossible to combine production and reproduction in the same way as before. When this change in the place of production took place, it was natural that the men resumed the productive role, as women were busy at home with reproductive duties—which were quite extensive at that time. However, improved forms of birth control lent women more time, meaning that they were no longer occupied with procreation for the majority of their lives. Furthermore, technology made housework less onerous and less time-consuming. At the same time, the changed psychology of the times put more of an emphasis on achieving better material standards than raising children. The Myrdals posited that women would respond to these changes with an increased rate of participation in the labour market, where they could spend their freed-up energy and time, or where they would simply be driven by economic needs, as had always been the case for a considerable number of women. The Myrdals viewed this as a development that could not and should not be stopped. By arguing that this development was inevitable, they dismissed all arguments that female employment threatened the male working population, already hard pressed by unemployment.97 The Myrdals were not motivated, at least not openly,98 by any feminist aspirations. They were not concerned with women’s issue as such, and did not base the discussion of female labour market participation on demanding rights for women. They considered female employment as the natural and, above all, unavoidable consequence of industrialisation, and the conflict of interests between family members that industrialisation invoked. Their discussion of the situation of married women took up only a few pages in their book, which laid down the grounds for the Swedish social policy to come. To the extent that they discuss the issue, it is from the angle of its impact on birth rates, the decline of which was their main concern. They acknowledged that female employment could be one of the hindering factors for reproduction, and aimed at mitigating the conflict that they recognised as existing between the two roles of women.99 They considered that women’s lives should not be prejudiced by their reproductive duties, which were occupying a shorter and shorter period of their lives. They were convinced that women would turn to the labour market in increasing numbers in the years to come. As this development could not be stopped, the Myrdals considered that if women were to reproduce, they would have to be facilitated in doing it, rather than forced by restrictions and laws on abortion and contraception. In saying this, 97

See G and A Myrdal, above n 96, in particular at 314 et seq. Alva Myrdal confessed later that had only arguments based on ‘emancipation ideals’ been put forward, women’s position would have been weak, although other feminists opposed this kind of strategy. See B Hobson, ‘Feminist Strategies and Gendered Discourses in Welfare States: Married Women’s Right to Work in the United States and Sweden’ in S Koven and S Michel, above n 12, at 409. 99 See also A Myrdal and V Klein, Kvinnans två roller (Stockholm, Tidens Förlag, 1957). 98

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Women and Social Security in a Historical Context 87 however, they offered a formidable tool for the emancipation of women, and changed public opinion in an unprecedented way. As Alva Myrdal herself pointed out later: ‘The remarkable thing is that in this crucial moment the population argument was wrenched out of the hands of anti-feminists and instead used as a formidable weapon for emancipation ideals. The old debate on married women’s right to work was turned into a fight for the working woman’s right to marry and have children. The change in public opinion was tremendous’ (emphasis added).100 In the 1960s and 1970s, the heritage of Ellen Key and maternalist feminism was almost completely abandoned in Sweden.101 Both in the feminist discourse and in the governments’ social policies, women were conceptualised exclusively as workers, and were almost forced out into the labour market. Domestic work was evaluated through participation in the labour market. Today, there is much more feminist support for day-care centres than for cash benefits paid to mothers, as proposed by some minor parties at the centre and right of the political spectrum. The elaboration of feminism in Scandinavia’s equal status legislation is often referred to as ‘state feminism’.102 2.2 Did Feminism Matter? Did feminism matter in shaping social policies and drafting social security schemes? Scholars appear to disagree about the answer to this question. Many writers point out the lack of political power on the part of women—in most countries women had not even acquired the right to vote when the first social security schemes were formed. They were in need of the support and often the voices of the gatekeepers among male professionals, bureaucrats and representatives of the various male associations in order to present their demands. Many late 19th and early 20th century feminists in Germany, for instance, were either the wives or the daughters of social liberal politicians.103 Many writers draw our attention to the paradox that it was not the countries with the strongest feminist movements that were most successful in adopting measures for women. Lewis remarks that Great Britain belongs to the strong male breadwinner model, although historically the feminist movement there was stronger than in France and Sweden. She considers that women’s own demands did not play a significant role in determining their treatment in the latter two countries.104 Jenson points out the same paradox when comparing the strength of women’s movements in the USA and France,105 and Hobson in the comparison between the USA and 100

Quoted in B Hobson, above n 98, at 410. Register writes that even the word ‘feminism’ was abandoned by feminist activists in the 1960s for fear of being associated with the ‘Ellen Key line’; it was replaced by ‘women’s cause’ (kvinnosaken) or ‘the sex-role question’ (könsrollsfrågan). See C Register, above n 58; see also U Broman, above n 32, at 18. 102 A Leira, above n 17, at 68–69. 103 J Lewis and I Ostner, above n 8, at 12–13. 104 J Lewis, ‘Gender and the Development of Welfare Regimes’ (1992) 2 Journal of European Social Policy 159, at 159. 105 J Jenson,‘Representations of Gender: Policies to “Protect” Women Workers and Infants in France and the United States before 1914’ in L Gordon, above n 13. 101

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88 Social Security and Gender Sweden.106 Klaus writes that in debating policies French politicians did not refer to the demands of women’s organisations but to the resolutions passed by all-male paediatric and obstetric associations, by the male-dominated Congrès national de la protection de la première enfance, and by the Académie de médécine.107 Other authors, on the other hand, underscore the influence of women’s movements. Chamberlayne counts feminism as one of the most important factors of change in state policies.108 Koven and Mitchell argue that the development of the welfare state was deeply influenced by maternalist reformers and their philosophies, commitments and social welfare experiments.109 Hobson and Lindholm argue for the ability of women’s collectives to articulate claims and exercise power in welfare states.110

3. Social Security and Demographic Concerns If the influence of feminist movements on the shaping of social policy is debatable, there seems to be more agreement concerning the impact of demographic concerns. These were paramount in the work of both Beveridge in Great Britain and the Myrdals in Sweden, although they led to different conclusions and different policies. The demographic concerns thus appear to have played an important role for the introduction of maternal policies in the framework of social security schemes, although it is difficult to estimate their precise significance. Feminism and demographic concerns were also closely intertwined in some cases, most notably France. Whereas, however, feminist policies put women at the centre and strove for an amelioration of their situation, the primary concern for demographic policies was the falling birth rate. Women were simply a means in the struggle against it. From the late 19th century, the declining birth rate was a matter of concern throughout Europe. Infant mortality was high, and working class women in particular bore much of the blame: the high rate was attributed to their ignorance and lack of knowledge. Governments sought to find ways to combat the declining birth rate, and maternity policies were conceived as one such measure. Other measures included improved sanitation, improved living standards, public health measures and the spread of knowledge about nutrition, health and hygiene. For women living in poorer conditions, as was the case with many women living in major cities, even small accretions of knowledge could make a world of difference for their infant’s and even their own survival, and prevent them from ruining their 106

B Hobson, above n 98, at 400. A Klaus, above n 82, at 199. 108 P Chamberlayne, ‘Women and the State: Changes in Roles and Rights in France, West Germany, Italy and Britain, 1970–1990’ in J Lewis, above n 17. Siim shares the same opinion: see B Siim, ‘The Gendered Scandinavian Welfare States: The Interplay Between Women’s Roles as Mothers, Workers and Citizens in Denmark’ in J Lewis, above n 17, at 30. 109 S Koven and S Michel, above n 12, at 29. 110 B Hobson and M Lindholm, ‘Collective Identities, Women’s Power Resources, and the Making of Welfare States’ (1997) 16 Theory and Society 475. 107

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Women and Social Security Today 89 health in connection with pregnancy and childbirth. Letters from working women of the time disclose how beneficial they found learning the importance of, for example, avoiding unnecessary heavy labour during pregnancy, such as whitewashing a room or cleaning windows.111 However, as the main reason for infant mortality was found to be the ignorance of mothers, this put an unbearable burden on many working class mothers. They were compelled to perform the impossible, providing their children both with both money and care, and were punished if they failed. Furthermore, those who were involved in child and maternal welfare movements argued that women’s primary duty in all social classes was to their infants, and thus work outside the home and anything else that detracted from this duty was to be discouraged.112 The concern with falling birth rates increased to proportions of near panic following the population losses caused by the First World War, and then by the continuance and acceleration of birth rate declines in the inter-war years. By 1933, the birth rate had declined to 14.4 births per thousand population in Germany (compared with 34.2 in 1880), 16.2 in France (compared with 24.6), and 13.7 in Sweden (compared with 29.4). Pro-natalist policies were adopted in most countries, and these were pursued with different degrees of rigour.113 To the extent that demographic concerns and pro-natalism induced the adoption of social welfare measures with respect to maternity, it was not always done in a way that served the cause of women’s liberation and emancipation. A distinction can be drawn here between countries with parliamentary democracies and countries with totalitarian regimes. Child allowances, for instance, became payable directly to mothers in countries like France and Sweden, while in Fascist Italy, Francoist Spain and National Socialist Germany they were paid to the fathers, in the context of a prevalent cult of masculinity and efforts to reinforce male authority in the family.114

II. WOMEN AND SOCIAL SECURITY TODAY

The assumption as to the roles of women initially incorporated in all the systems was that of a dependent lifelong wife of a full-time industrial employee. Gradually, the systems were compelled to accept the existence of female workers and to introduce allowances and benefits in order to cover the risks exclusively connected with working women’s reproductive capacity. The main assumption, however, 111 P Thane,‘Visions of Gender in the Making of the British Welfare State: The Case of Women in the British Labour Party and Social Policy, 1906–1945’ in G Bock and P Thane, above n 2, at 103. 112 J Lewis, above n 10, at 91. 113 The demographic anxiety about the populations was accompanied by an anxiety about its quality as well, thus turning pro-natalism to eugenic pro-natalism in many countries. In an atmosphere of increasing antagonism for dominance in an internationalised market and for military and imperial domination, it seems that countries were not only interested in a mere population increase, but the question of the fitness of the population was crucial. See eg J Lewis, above n 5, at 15 et seq; A Klaus, above n 82, at 202 et seq; G Bock, ‘Anti-natalism, Maternity and Paternity in National Socialist Racism’ in G Bock and P Thane, above n 2, at 234. 114 G Bock and P Thane, above n 2, at 13.

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90 Social Security and Gender about women’s roles did not change. The result was that the work of women was seen as less valuable than that of men, as male income was to be a family income and the wives’ income only of a secondary and auxiliary nature. Unequal treatment was legitimised with the aim of bringing women home. One can point to the paradox of the fact that, although the systems were designed primarily for working class people, they incorporated a bourgeois family ideal—an ideal which was far from the reality of many working class families with an insufficient sole male income, and of many deserted, divorced or unmarried women, who formed a large proportion of the female labour force. This is mostly attributed, as mentioned above, to the prevalence of the bourgeois marriage ideal, an ideal shared by men and women, the working class, trade unions and the state.115 Later on, especially in the post-war period, the assumption of female dependence on a male breadwinner began to erode to various extents in the different countries. The male breadwinner role was still recognised in all countries, but differences were articulated as to the extent to which women were confined to homemaking and motherhood. Women were also recognised as workers, but to varying degrees. The shift from a motherhood-centred vision to a worker-centred assumption produced differing results in terms of women’s entitlements to benefits. The European countries did not all develop in the same way.With regard to social security, and in particular the gender aspects of social security, the countries appear to have followed different paths. Today, the Member States of the European Union exhibit essential differences in their assumptions about the roles of women, which are of critical importance for women’s entitlements to benefits and welfare services. Yet, the differences in the assumptions about gender as incorporated in the systems and the final situation of women in welfare terms did not become visible even in more recent and more sophisticated distinctions drawn with respect to welfare models.116 This weakness of the established typologies in terms of illuminating the situation of women has been criticised by feminist writers.117 Mainstream welfare typologies have been criticised for privileging social class and capitalist market relations rather than gender in order to explain the development of social rights.118 115 E Kofman and R Sales, ‘The Geography of Gender and Welfare in Europe’ in MD García-Ramon and J Monk (eds), above n 40, at 36; J Lewis and I Ostner, above n 8, at 18. 116 For example, Esping-Andersen’s classification was criticised for ignoring the fact that many women gain social entitlement not via labour market participation but by virtue of their relationship to a male breadwinner party; see L Ackers, ‘Citizenship, Gender and Dependency in the European Union: Women and Internal Migration’ in T Hervey and D O’ Keefe, above n 17, at 223 (with references). Gustafsson showed that this typology, which worked out mainly for pensions, sickness benefits and the creation of jobs in the public sector, could nevertheless apply even to childcare: see S Gustafsson, ‘Childcare and Types of Welfare States’ in D Sainsbury (ed), Gendering Welfare States (London, Sage Publications, 1994). 117 See eg E Kofman and R Sales, above n 115; J Lewis, above n 5, at 161. For criticism as to the omission of a gender analysis of the welfare state in general, see B Hobson, above n 98; L Gordon, ‘The New Feminist Scholarship on the Welfare State’ and V Sapiro, ‘The Gender Basis of American Social Policy’ in L Gordon, above n 13. For critics of the welfare state as reproducing gender roles, see E Wilson, Women and the Welfare State (London, Tavistock Publications, 1977). 118 See J Bussemaker and K van Kersbergen, ‘Gender and Welfare States: Some Theoretical Reflections’; A Borchorst, ‘Welfare State Regimes, Women’s Interests and the EC’; A Siaroff, ‘Work,

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Women and Social Security Today 91 Women have entered comparative academic analysis of social policies only as paid workers. As soon as they disappear from the labour market, they disappear from the analysis.119 Feminist authors have sought to extend the study and the distinction of different models beyond the limits of the labour market. Access to areas of welfare beyond social security then became critical for the analysis. As men’s relationship to the welfare state is to a great extent effected through social security, welfare state distinctions have mainly been based on differences among the social security systems.120 When it comes to women, their relationship to social security is not sufficient to explain their relationship to the welfare state. Women are more dependent on other institutions of the welfare state, apart from social security. Therefore, the classification of welfare states from a gender perspective has required a consideration of several institutions of the welfare state. Lewis and Ostner argue that when gender is taken into consideration, it cuts across the established typologies of welfare states.121 For instance, while Sweden and Norway are classified as belonging to the same Social Democratic model, the model breaks down as soon as gender is taken into account. The notion of a common Scandinavian model needs qualification when reproduction policies are at issue, as the concept of the working mother was politically institutionalised in Sweden to an extent not matched in Norway.122 In terms of the assumption of women’s roles, Norway is much closer to Britain than Sweden.123 The same applies with regard to Germany and France, both classified under the conservative model. Lewis and Ostner insist that theoretical concepts, as well as empirical research, ignore the other side of the coin: that the worker’s productivity and mobility, ie his or her independence, is inevitably built on the unpaid work of others, ie on his or her dependence. They argue that a gender analysis of welfare demands that the private sphere be integrated into the analysis.124 1. Gender Models of the Welfare State in the Member States of the European Union Several categorisations of welfare states with regard to gender have been proposed. Lewis and Ostner (1994) suggest a categorisation between ‘strong’, ‘moderate’ and Welfare and Gender Equality: A New Typology’; M Daly, ‘Comparing Welfare States: Towards a Gender Family Approach’; L Bryson et al, ‘Men’s Welfare State, Women’s Welfare State: Tendencies to Convergence in Practice and Theory’; all published in D Sainsbury (ed), above n 116. 119 J Lewis and I Ostner, above n 8, at 5 et seq. 120 Above, ch 1, at I, 3. 121 Bussemaker and Van Kersbergen also take the view that welfare state regimes and gender regimes do not necessarily coincide: see J Bussemaker and K Van Kersbergen, above n 118. 122 See A Leira, above n 17, at 50 and 64 in particular. 123 Other authors, however, consider that gender policies have been a distinct feature of a common ‘Nordic model’ of the welfare state and that, despite differences, the similarities between the Nordic countries appear more important than the differences. See R Kjeldstad, ‘Gender Policies and Gender Equality’in M Kautto et al (eds), Nordic Welfare States in the European Context (London, Routledge, 2001). 124 J Lewis and I Ostner, above n 8, at 5.

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92 Social Security and Gender ‘weak’ male breadwinner states, on the basis of the prevalence of the male breadwinner vision.125 This typology is described in more detail in the following pages. First, a few words about the other models and categorisations. Kofman and Sales add a new dimension to women’s unpaid work, that is, care responsibilities of parents and other relatives. Women tend to be at the centre of a network of obligations, which includes not just children but parents and other relatives, neighbours and friends. Therefore, they argue, we need to broaden our definition of welfare services to include support and care directed towards people’s physical, psychic and emotional well-being. These obligations impact on women’s citizenship status and entitlements. Caring responsibilities limit access to the labour market and thus women’s entitlements to earnings-related welfare benefits. They also prevent women from participating in formal political structures to the same extent as men.126 Thus, these authors draw attention to the care of adult family members, such as adult children, the elderly and the disabled. On the basis of the criterion of classification, they propose a distinction between obligatory and non-obligatory familial support for the elderly in welfare policy. They note that Denmark imposes the fewest statutory obligations on the family as it has the highest proportion of elderly in publicly-funded, (long-term) care institutions.At the other extreme, the constitutions of many European states, mostly those categorised by Esping-Andersen as ‘conservative’, include an obligation on parents and children to care for each other. Thus, for example, in France children are not eligible for benefits until the age of 25, before which age they fall within their parents’ sphere of responsibility. In other countries, such as Britain, Denmark and Sweden, children are expected to set up independent homes prior to marriage. Duncan127 sees differences in gender inequality not only at a national level between countries, but also at a sub-national level within the countries.128 He summarises four different models, developed in the literature, for designating the countries of the European Community with respect to gender systems. These are the gendered welfare state model, the breadwinner state model (both developed in feminist critiques of social policy), the differentiated patriarchy model and the gender contract model (developed in feminist sociology).129 A different typology has been developed by Siaroff. Three models are distinguished: Protestant Social Democratic welfare states; advanced Christian Democratic welfare states; and late Female Mobilisation Welfare states.130 Sainsbury distinguishes two models, the Breadwinner Model and the Individual Model. She emphasises that gendering welfare states requires that women’s entitle125 This categorisation, however, has been criticised by other feminist writers for concentrating too narrowly on the labour market, ignoring other important dimensions to welfare; see E Kofman and R Sales, above n 115, at 34. See also below n 131. 126 E Kofman and R Sales, above n 115, at 33–34. 127 S Duncan,‘The Diverse Worlds of European Patriarchy’ in MD García-Ramon and J Monk, above n 40. 128 Ibid, at 75. 129 Ibid, at 98–99. 130 A Siaroff, above n 118.

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Women and Social Security Today 93 ments not only as wives and workers,131 but also as mothers and citizens be built into the analytical framework in order to investigate cross-national variations.132 Chamberlayne developed a typology as to feminism and social policy in the 1980s and 1990s, according to which four approaches to gender relations are distinguished: gender neutrality, in which little or no account was taken to the specifics of women’s positions; gender recognition, focusing on the particular obstacles impeding women’s equality, especially those regarding reproduction; gender reconstruction, emphasising the need to change men’s roles; and gender reinforcement, serving either to reaffirm the traditional female roles and values or to emphasise the different social space occupied by women.133 In the following pages, more attention is given to Lewis and Ostner’s gender categorisation of welfare state—one of the most influential categorisations—in an attempt to highlight the different assumptions about women’s roles incorporated in the systems of the Member States. This focus on difference is of the utmost importance from a migration perspective, since it reveals the profoundly different ways in which women can be treated with respect to their country of origin and country of residence, as well as the different expectations and pressures placed on them by the systems. 1.1 The Strong Male Breadwinner Model: Germany According to Lewis and Ostner, the majority of modern welfare states can be categorised as belonging to the strong male breadwinner model. This model implies a breadwinning role for men, and a homemaking and caring role for women.134 The breadwinner model in its pure form requires full employment, a continuous adequate male income, and transfers that continuously supplement the latter, as well as incentives for men to marry and stay married. Women are entitled to derived rights and benefits as wives and married mothers, such as widow pension rights, and alimony regulations after a divorce for wives and children. Furthermore, the model implies different but equal treatment and positive discrimination. Womenspecific social rights are needed to compensate for the incomplete access women have to an independent market income. Lewis and Ostner further argue that the ‘strong male breadwinner’ model predicts relatively low levels of female labour market participation. It tends to draw a firm line between public and private responsibility, which, in the end, only allows for part-time or other forms of discontinuous work, and for a ‘sequential’ combination of work and family. If women enter the labour market, they must often do so on 131

Thus critical to Lewis’s and Ostner’s typology, who, according to her, take women into account only as wives and workers. 132 D Sainsbury, ‘Women’s and Men’s Social Rights: Gendering Dimensions of Welfare States’ in D Sainsbury, above n 118. 133 P Chamberlayne, above n 108. 134 See also S Leibfried and I Ostner, ‘The Particularism of West German Welfare Capitalism: The Case of Women’s Social Security’ in M Adler et al, The Sociology of Social Security (Edinburgh, Edinburgh University Press, 1991).

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94 Social Security and Gender terms very similar to men—in other words, they experience ‘sameness treatment’. Since the assumption is that the family provides childcare, provisions for maternity leave, pay and the right to reinstatement are usually inadequate. According to this categorisation, Germany, Britain,135 Ireland and the Netherlands136 all belong to the strong breadwinner model, although with different modifications and to different degrees within each particular country. The common denominator for all these countries is that they have all tended to treat adult women as dependent wives for the purpose of social entitlements. They differ in terms of the extent to which they attempt to promote marriage and family life by offering different kinds of incentives to men for being husbands, and with respect to the compensation granted to women upon leaving employment and performing caring work at home. German income taxation, for example, treats the married couple as ‘one’ or ‘the’ economic unit. It privileges one-earner childless couples with a middle average income, while the British and the Dutch systems are individualised, but give tax reductions to married one-earner couples.137 The archetype of a strong male breadwinner country in Lewis and Ostner’s categorisation is Germany, at least the former West Germany. As they note, until recently, the country has been strongly inclined towards middle class political and social values, among which is the husband-breadwinner. Following the line ‘neither Nazi nor GDR’—which also affected feminism, as discussed above—German policies from 1950 onwards established a strong family free from immediate state interventions, constitutionally protected in Article 6 of the West German Grundgesetz (Constitution).138 The legal authority of the husband and pater familias was not undermined until later, and, then, only superficially.139 Following its tradition of different roles for men and women, the German system today attaches some recognition and monetary value to the unpaid work of women at home, mostly in terms of pension entitlements. In response to a statement made by the Constitutional Court in the 1960s that housework and employment are of comparable value, child-rearing legislation was passed in 1986, which prescribed 135 For a critical view of the British system for its inability to adapt to new social attitudes and behaviours, see B Abel-Smith, ‘Sex Equality and Social Security’ in J Lewis (ed), Women’s Welfare, Women’s Rights (London, Croom Helm, 1983). See R Lister, Women’s Economic Dependency and Social Security (Manchester, Equal Opportunities Commission, 1992) for feminist criticism of the system. 136 Some writers speak of a Dutch paradox in the sense that while the Netherlands is famous for its strong feminist movement and tolerance of gender issues such as homosexuality, abortion, birth control and single parenthood, social security and certain other areas continue to favour the traditional oneearner families. See JD Fortuijn,‘City and Suburb: Contexts for Dutch Women’s Work and Daily Lives’ in MD García-Ramon and J Monk, above n 40. 137 J Lewis and I Ostner, above n 8, at 24. 138 This article was considered to be in conflict with Article 3 of the West German Constitution, which set out the equal rights of men and women, thus demonstrating the conflict of ideas about the roles of women at the constitutional level. This conflict also exists, however, in the constitutions of other Member States. 139 Husbands legally had the final word concerning certain issues within the marriage until 1957. They were empowered to stop their wives from taking paid employment until 1977, and they had the final word as regards their children until 1980. On the Family Law Reform of 1957 and general developments in West Germany in the post-war period see RG Moeller, Protecting Motherhood. Women and the Family in the Politics of Post-war West Germany (Berkeley, University of California Press, 1993).

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Women and Social Security Today 95 pension rights for time spent as a caretaker at home. Thus, a parent who was the primary carer at home and worked fewer than 20 hours a week is entitled to a pension for child-rearing.140 Further, women caring for very frail elderly or handicapped people who need institutional care and who would otherwise have to live in an institution are entitled to a small amount of money provided as a kind of pocket money. However, in many other contexts, women’s unpaid work is not recognised. The principle of subsidiarity, which is dominant in many areas of social security, implies unpaid, mainly female work, within the context of family self-reliance and solidarity. To the extent that a shift has occurred entailing a transfer of responsibility from the private sphere to the public sphere, on the whole it is a family obligation to provide financially for its members and relatives.141 Despite some recognition of the work of mothers as such, the main characteristic of the German system is that it treats women as wives rather than mothers.142 The system is strongly biased towards marriage as the basis of the family and of women’s lives, and the tax system privileges the married couple. As a consequence, the system results in differences in the treatment of married and unmarried mothers, and between legitimate and illegitimate children. Public childcare in Germany is not adequate, and it is not intended as support for employed mothers. Childcare functions more as a support for homemaking mothers so that they can better devote a short amount of time, free from children, to domestic tasks and services, rather than facilitating engagement in paid work. Thus, publicly funded childcare centres, where they are available, are in principle designed for children over the age of three, and they operate on a part-time basis during the morning hours, while schools are closed at lunchtime.143 Nevertheless, the strong male breadwinner model seems currently to be eroding in the aftermath of German reunification,144 and under the influence of the European Union’s policies. The focus is placed on the children’s best interests, and on the parents’ shared responsibility concerning the children, regardless of their marital status. Despite its inherent emphasis on female dependence, it is argued that the system is not necessarily detrimental to women in economic or other terms. For example, the provisions as to widow and widower pensions are designed to compensate for the loss of the partner’s income, without any significant demands in terms of working ability, age or length of marriage. In many cases, it can be economically beneficial for women. Ostner points out that the German welfare regime produces its own winners and losers. Those women who manage to get married to a 140 As to the introduction of other benefits related to child-rearing in the West German system, see P Chamberlayne, above n 75, at 180. 141 See J Lewis and I Ostner, above n 8, at 22. 142 Ibid, at 16. See also I Ostner, above n 61, at 104. 143 S Duncan, above n 127, at 83; J Lewis and I Ostner, above n 8, at 21. Similar arrangements and lacks are found in other countries belonging to the same model, for example the Netherlands. See JD Fortuijn, above n 136, at 217. 144 As to family and gender policies in the former German states as well as the impact of unification see E Kolinsky (ed), Social Transformation and the Family in Post-communist Germany (London, Macmillan, 1998).

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96 Social Security and Gender continuously employed man, to have a happy marriage and who are content with this lifestyle are the winners. In such cases, the result is not simple dependency. As she writes,‘in a capitalist society staying at home and living on a husband’s income incorporates the likelihood of a restricted independence via personal dependence’.145 Those benefiting the most in that sense are middle class wives, who can afford to leave the labour market by relying mostly on their husband’s income and marriage-based forms of social security. Other countries belonging to the same model are the southern European countries. Unlike Duncan, Lewis and Ostner do not explicitly include the countries of southern Europe into their categorisation, and do not classify them as belonging to the strong male breadwinner model. Southern Europe is not a homogenous area but, with regard to women, common experiences can be found, particularly concerning two issues: the experience and content of paid and unpaid work; and the importance of the family in everyday life and in women’s strategies to cope with and change their condition.146 Caring and domestic labour remains the responsibility of women throughout southern Europe, and women bear the burden of family responsibilities. However, as more young women enter the labour market, domestic work increasingly becomes the domain of women of the older generation. To put it another way, women’s paid work relies on the unpaid work of other women, most notably their mothers.147 This brings us to the key feature of all southern European welfare regimes, which is to say the crucial role of the family.148 Family is understood as a unit including three generations, especially when it comes to women’s integration into the labour market. Grandmothers provide care on an unpaid basis, to an extent often exceeding both the needs created by mothers’ participation in the labour market and the services of state welfare institutions, even compared with countries with developed state welfare systems.149 1.2 The Moderate Male Breadwinner Model: France France is considered to be the archetype of the moderate breadwinner model. Finland is also sometimes classified in this category, and at other times is counted as a weak male breadwinner country. The same can be said of Denmark. The model is usually described in terms corresponding to the French reality, and many studies refer to the uniqueness of the French experience and policies. 145

I Ostner, above n 61, at 106. D Vaiou, ‘Women’s Work and Everyday Life in Southern Europe in the Context of European Integration’ in MD Ramon-García and J Monk, above n 40, at 61. 147 Ibid, at 69. 148 Above, ch 1 at I, 3.4. 149 Other factors that facilitate women’s paid employment, especially in the public sector, are advantageous working hours (the work schedule in the public sector in Italy is between 8am and 2pm; see P Vinay, ‘From Informal Flexibility to the New Organisation of Time’ in MD García-Ramon and J Monk, above n 40, at 214); a system of promotion and salary increases based on seniority and not on productivity; and law-guaranteed job security (sometimes even at constitutional level, as in the case of Greece), which enables women to combine employment and family responsibilities. 146

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Women and Social Security Today 97 The salient characteristic of the model is that it recognises and promotes women’s position as both wife/mother and worker.150 Good mothering is important in France as a result of a combination of pro-natalism and Social Catholicism. On the other hand, given the occupational structure in France, it was not easy to ignore women as workers. In France, there was a long tradition of female participation in the workforce, partly due to the importance of agriculture, handicrafts and small businesses in the French economy. A large percentage of married women worked in the family business alongside their husbands; 20 per cent of working women were employed in rural enterprises up to 1968.151 Thus, the exclusion of married women from employment was not easy or desirable, and trade unions and governments made no organised attempt to push women out of the labour market. For the same structural reasons, husbands also had little impact on married women’s employment, despite their legal authority.152 As a result, the French system is characterised by high rates of female labour participation, and relatively generous social benefits and welfare services. A significantly high percentage of French women continued to work full-time throughout the 20th century. In the early 1980s, the percentage of women working continuously during the childbearing and child-rearing period was ten times higher than in Britain.153 With regard to non-working women, a generous allowance was paid to families with a single wage earner in the years between the 1930s and 1977. Despite this, however, married women’s labour participation increased significantly in the late 1960s and early 1970s.154 The hallmark of post-war social welfare policies in France has been the constant shifting between, on the one hand, policies supporting motherhood as a recognised social function and, on the other, measures designed to integrate women into the labour force.155 The underlying trend, in all successive governments’ policies, has been towards recognition of women’s productive and reproductive roles, and preserving measures to protect both.156 However, with regard to social security in particular, the system is far from being neutral. The underlying concept is that health care and maternity benefits should be earned, either directly or indirectly, through economic activity rather than through automatic citizenship rights or simply the reward of motherhood. Thus, pressure is exerted on mothers to encourage them to work outside the home as a means of gaining access to social insurance cover, and to adapt to that which was initially conceived of as the dominant model of social security.157 Nevertheless, the effects of the system are modified depending on the 150 For a comparison of gender assumptions in the welfare policies of France and the USA see J Jenson, above n 105. 151 J Lewis and I Ostner, above n 8, at 25; see also J Fagnani, above n 40, at 129. 152 The husband’s right to prevent his wife from taking a job was abolished in 1965; the father’s full parental authority was abolished in 1970. 153 J Lewis and I Ostner, above n 8, at 25. 154 Ibid, at 26. 155 L Hantrais, above n 88, at 116. 156 Ibid, at 124. 157 Ibid, at 134.

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98 Social Security and Gender income of the individual woman. Whereas well-qualified women with a high income are encouraged by the system to remain economically active, there is a delicate balance for women with lower incomes between incentives to continue in paid employment or to stay at home and raise large families.158 Women’s right to employment is no longer disputed, and the policies have concentrated on making it possible to combine work and family life. In any case, the status of mothers who stay at home to look after their children has been given official recognition since 1988, by making mothers of large families eligible to receive free access to health insurance from the age of 45.159 1.3 The Weak Male Breadwinner Model: Sweden In Lewis and Ostner’s classification, post-1970 Sweden exemplifies a weak male breadwinner state.160 The authors consider all the Nordic countries as belonging to the same model, although they emphasise the differences between them. Significant modifications of the Scandinavian model with regard to gender have also been highlighted by other writers. Between Sweden and Norway, for instance, there is considerable disagreement over the extent to which the concept of the working mother was politically institutionalised. While mothers were conceived as workers in Sweden, Norwegian policies in the 1960s and 1970s evidence disagreement, indeed of outright opposition, to such a concept.161 As a consequence, the provision of publicly funded day-care for pre-school children in Norway is notably lower than in its neighbouring countries.162 Sweden and Denmark have the highest rates of childcare provision in the Western World. On the other hand, Norway, alone in Scandinavia, includes benefits for single providers in the national insurance scheme. The idea is to give single parents, the majority of whom are women, an opportunity to opt out of employment while their children are very young, although the amount they receive is low. In contrast, Sweden and Denmark have decided that the best way to solve single mothers’ problems is through labour market participation and the provision of publicly funded childcare or through social assistance.163 All Nordic countries, however, follow the pattern of ‘modernised motherhood’.164 Policies in Sweden, like the rest of Scandinavia, were from the beginning gendered.165 During the late 1960s and early 1970s, however, Sweden’s Social 158

L Hantrais, above n 88, at 127. Ibid, at 134–5. 160 J Lewis and I Ostner, above n 8, at 27. 161 A Leira, above n 17, at 58. See also A Leira, ‘Mothers, Markets and the State: A Scandinavian “Model”?’ (1993) 22 Journal of Social Policy 329. 162 A Leira, above n 17, at 58. 163 Ibid, at 61. 164 The concept has been used to capture the rapid growth in mothers’ labour force participation; see E Drew et al (eds), Families, Labour Markets and Gender Roles. A Report on a European Research Workshop (Luxembourg, European Foundation for the Improvement of Living and Working Conditions, 1995), at 39. 165 Even the Social Democratic party in its formative years supported the ideal of a family salary for the male breadwinner: C Carlsson, above n 7. 159

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Women and Social Security Today 99 Democratic governments took conscious steps to draw all adult women into the workforce and to make the two breadwinner family the norm. It has to be noted here that in the early post-war years, as well as in the years before the Second World War, Sweden and other Scandinavian countries had low rates of female labour market participation—indeed they were lower than in many other Western countries in the 1950s and 1960s. Married women, and married mothers in particular, stayed at home. The typical female labour force consisted of unmarried, deserted or divorced women. Upon marriage, women who could afford to do so left paid work. Married mothers in paid employment were, generally, very poor. In the first half of the 20th century, women’s rights were based on their capacity as wives and mothers in line with the male breadwinner model.166 A crucial change occurred in the 1930s and beyond, when, according to Hobson, maternalist policies switched to signify the right of married working women to have children, instead of the right of married mothers to work.167 The overall conceptualisation, however, of women as workers first and then as mothers occurred in the late 1960s. The radical changes in public policies towards women and in women’s own perception of their roles as mothers and workers have been described as a ‘silent revolution’ in the daily lives of women, centred on their right to work and to choose whether to have a child.168 Comprehensive schemes for collective day-care were developed with the aim of making mothers available for labour market participation. The social conditions, norms and values of motherhood and childcare changed. The rationale for public-care institutions became pedagogical, and directed towards all children, not only the poor.169 Separate taxation and the introduction of parental leave were other measures adopted with the same aim. Siim speaks of a second stage of the welfare state beginning around 1965, the cornerstone of which was an increase in the public production of services, especially childcare and other services for children, young people and the elderly.170 At the same time, the system provided for generous maternity benefits and periods of leave from work in order to take care of children. This is mainly attributed to the significant influence of the ideas of Gunnar and Alva Myrdal.171 As already noted, as early as the 1930s the Myrdals were already advocating a whole range of social policy measures, ultimately aimed at reforming society and some of its main institutions. They pointed out a number of factors behind the decreasing birth rate, including working conditions and income insecurity, housing conditions, the conflict between productive and reproductive work, etc, and insisted on the importance of social intervention to solve the problems. Along with secured 166 As to gender policies in Sweden see Y Hirdman, The Swedish Welfare State and the Gender System: A Theoretical and Empirical Sketch (The Study of Power and Democracy in Sweden, English Series, Report No 9, 1987). 167 B Hobson, above n 98, at 413. 168 B Siim, above n 108, at 35; K Simonsen, ‘Family, Gender and Urban Life: Stability and Change in a Copenhagen Neighbourhood’ in MD García-Ramon and J Monk, above n 40, at 230. 169 B Siim, above n 108, at 35. 170 Ibid, at 32. 171 Register considers, on the contrary, that the generous maternity provisions in the Swedish system were basically a result of the influence of Ellen Key’s maternalist ideas; see C Register, above n 58.

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100 Social Security and Gender work and income conditions, they demanded the payment of cash benefits upon the birth of a child to all families, irrespective of social class. Further, they demanded organised collective care not only for working class children but for all children, as they acknowledged an important pedagogical function of this kind of care. In short, their vision embraced the transformation of the traditional family, which they considered obsolete, to meet the demands of the new era. To this end, part of the childcare role would be transferred from the family to collective organs. Alva Myrdal developed her influential idea of women’s dual role, which would give women the possibility of combining, sequentially, employment and motherhood. The Swedish vision of a new society in the 1940s, as expressed by the Myrdals, included new roles for women based on the sequential combination of motherhood and employment.172 Sweden established a comprehensive system of leave and benefits at labour market rates, which has attracted worldwide interest. However, the road to generous social allocations is via the labour market. Men and women are treated as citizenworkers with no regard to gender, and women are entitled to generous maternity benefits as workers. In other words, the hallmark of the system is recognition of motherhood through employment. Outside the labour market, the benefits are poor and insufficient. Individualisation and independence through the labour market have made it easier to combine paid and unpaid work, but there is not much ‘choice’ left for women in terms of engaging in paid work. Thus, women have been ‘forced’ into the labour market, while retaining the unpaid work of caring. Men’s behaviour has not changed. As Hirdman puts it, the male is the norm, the female is ascribed a lower value. Women act in a male role, although inevitably less efficiently than men. Thus, the overall effect of these policies was to change women’s lives rather than men’s.173 Despite incentives in the form of paid parental leave, it is mostly women who make use of the right to time off.174 Lewis175 mentions that there is a difference in men’s behaviour, in the sense that they at least feel they should participate more in unpaid work.176 172 With regard to the demographic effects of the Swedish policies, they occasionally appear to have effectively succeeded in getting women to both work outside the home and have children. At the beginning of the 1990s, the Swedish birth rate was high as compared to other West European countries. However, the rate is not stable. The fertility rate was 1.6 in 2002; see SCB, Statistical Yearbook of Sweden 2004. 173 S Duncan, above n 127, at 95. See also J Lewis and I Ostner, above n 8, at 29; J Lewis, above n 104, at 170; B Siim, above n 108, at 37. 174 Research has shown that housework is more equally divided where both partners are young and full-time workers or where the woman has a higher level of education. 175 J Lewis, above n 17, at 6–7. 176 Another point of criticism against the Swedish model is the serious sex segregation of the labour market. Sweden had, and still has today, one of the most segregated labour markets in the Western World. Hobson argues that this segregation was one of the major reasons for the trade unions’ support of female employment. Male Swedish workers did not feel the same competition from female workers as their colleagues in other countries, and, in addition, there were different standards for male and female work. As Hobson writes, the gendered wage differential was so institutionalised that in official reports on Swedish wages in the 1930s, there were three categories of workers: skilled male workers, unskilled male workers, and female workers (B Hobson, above n 98, at 404). Different wage scales were abolished during the 1950/1960s.

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Women and Social Security Today 101 Institutional day-care, however effective, is only a partial care provision, leaving a great deal in the private sphere of the home. As Siim points out, the professional system of care has not replaced the informal system of care in families. On the contrary, collectivised care relies on the symbiotic relationship between formal and informal welfare institutions. Caring relationships between the young and the old have mainly taken the form of occasional help and socialising. Despite changes in family structure, informal caring work is still important and the family still has a strong ideological significance for individuals.177 In material terms, the Swedish and the other Scandinavian welfare terms brought real gains for women.178 However, working mothers, despite relatively high material profits, are extremely time-poor. Single working mothers in particular, as studies have shown, display high levels of psychological stress.179 Before concluding this sub-section, it should be noted that the systems of the new Member States are not included in the known typologies as these countries entered the Union only recently; it is very likely, though, that the study of their systems would not change the typology essentially. It should also be underlined that under the influence of the European Union, national systems are gradually converging. The emphasis in the policies of the Union as it is expressed though ‘mainstream’ gender policies is on similar roles for men and women and, consequently, on the weak male breadwinner model.

2. Women and Current Challenges and Developments in Social Security As shown in the previous chapter, many of the current problems in the social security field are related to women. Labour market, family and demographic changes all have gender aspects. Schultheis considers the gender question to lie at the heart of the debate on new social risks in a way analogous to the issue of the working class at the heart of the debate in the 19th century.180 Female participation in the labour market is not compliant with prevailing employment forms and with employment patterns envisaged by social security schemes. Women are over-represented in atypical forms of work. Indeed, the increased economic participation of women in the labour market has occurred in a way that aggravates their position as ‘atypical workers’.181 As a consequence, women may experience difficulty in joining a social security scheme if such schemes contain requirements as to a minimum level of employment or earnings, or because of their inability to pay contributions due to low earnings. 177

B Siim, above n 108, at 36–37. A Leira, above n 17, at 68. J Lewis and I Ostner, above n 8, at 32. 180 F Schultheis, ‘Changement familial, régulation étatique et emergence d´un nouveau «risque familial»’ in J Van Langendonck (ed), The New Social Risks, EISS Yearbook 1996 (The Hague, Kluwer Law International, 1997), at 93. 181 R Lister, above n 25, at 16. 178 179

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102 Social Security and Gender Reproductive and caring responsibilities still form economic handicaps for many women: ‘Women’s advances into the labour market have not given them equality with men, and perhaps never will. Contrary to popular perception, they have reduced rather than eliminate many women’s dependency on their partners.’182 The main response of the systems to the new conditions that emerged following women’s labour market participation and other social changes has been a trend towards an individualisation of social security rights within the framework of endeavours to establish universal systems based on the social citizenship model. The individualisation trend, which downplays the value of derived rights, has however highlighted the failure of the social citizenship model to recognise women’s unpaid work at home, and to safeguard equal conditions and equal rights for all citizens. Half a century after the Beveridge Report, which laid the grounds for the social citizenship model, this important work still needs to be made more visible, and rewarded rather than penalised in the social security system.183 The social citizenship model has failed to acknowledge the vital importance of unpaid work or to provide women with sufficient levels of social security: ‘It is in the inferior, non-contributory parts of the social security system that the main recognition of unpaid caring work is to be found, albeit not always explicitly and rarely adequately.’184 It has been pointed out that until the early 1880s, women (especially married women) were debarred from independent property ownership. Similarly, even in the second half of the 20th century (and at the beginning of 21st century, it should be noted) any discussion of women’s place in the labour market ‘inevitably reveals a catalogue of patriarchal role models, discriminatory treatment and blatant inequality. Nevertheless, the facade of citizenship has been maintained’.185 Other authors speak of segregation of the welfare state and of dual welfare, where men are more likely to be recipients of social insurance while women most often rely on means tested programmes.186 Fears have been expressed that the individualisation of social security rights may dismantle the protection many women need, if the process does not take into proper consideration the unpaid services of women.187 Derived rights, it is argued, should not be utterly dismissed as grounds for social security entitlements, at least with regard to old-age pensions. Some authors argue for the individualisation of derived rights. If one wishes to maintain an above minimum social protection, they argue, then one cannot but retain the system of derived rights. After all, an individual’s livelihood depends not only on their professional income, but also on the family unit to which they belong or used to belong. It should also be taken into account that, due to the persistent wage differences between men and women (as 182

H Joshi and H Davies,‘The Paid and Unpaid Roles of Women: How should Social Security Adapt?’, paper presented at the University of York conference, above n 18, at 89–90. 183 Ibid, at 84. 184 R Lister, above n 25, at 17. 185 Ibid. 186 D Sainsbury,‘Dual Welfare and Sex Segregation of Access to Social Benefits: Income Maintenance Policies in the UK, the US, the Netherlands and Sweden’ (1993) 22 Journal of Social Policy 69. 187 H Joshi and H Davies, above n 182, at 84.

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Women and International Social Security 103 women usually take on more responsibilities within the family), a full individualisation of pension rights will inevitably be detrimental to women (and, in general, to anyone who during certain periods of his/her active life was more involved in domestic work than in paid labour). In light of the problems springing from the destabilisation of the family, and in order to accommodate the generalisation of double-income households as well as the economic independence of women, one might consider adjusting the modalities of derived pension rights. Moreover, they could be individualised, for instance through the system of credit splitting. By analogy with retirement pensions for divorced people, one could award personal social rights that are proportional to the rights built up by the two partners during the period of marriage/cohabitation.188 The focus of the European Community’s social policies on economically active people has reinforced the trend for individual social security rights based on economic activity. Extensive criticism has been directed towards European policies for focusing on the citizen as the worker,189 and arguments have been put forward for the extension of the concept of ‘worker’ to include who perform unpaid care work.190

III. WOMEN AND INTERNATIONAL SOCIAL SECURITY

Classifications of welfare systems have not taken into consideration systems of coordination. It is obvious, however, that these systems would be classified under the strong male breadwinner model. They are based on the assumption that the typical migrant is a male breadwinner. His social security rights are based on his economic activity, while derived rights are envisaged for members of his family. For women, this means that their social security rights are based on their relationship with the worker, ie marriage, and they are primarily perceived as tied-movers.191 Thus, the social security law of co-ordination belongs to the strong male breadwinner model. 188 B Cantillon et al, ‘Social Protection, Gender and Poverty Issues’ in D Pieters (ed), Confidence and Changes: Managing Social Protection in the New Millennium, EISS Yearbook 2000 (The Hague, Kluwer law International, 2001), at 115. The authors find three reasons why the system of derived rights is currently under review: First, because the protection that such rights offer is presently insufficient. Fragmented family careers increase the likelihood of someone slipping through the safety net of family-oriented social protection. Second, because they are discriminatory to working women as derived rights cannot be accumulated with individual rights. Third, because if they cover risks relating to care activities (which is not always the case), they do so indirectly. They are, thus, often not perceived as compensation for care work. 189 See eg T Hervey, ‘Migrant Workers and their Families in the European Union: The Pervasive Market Ideology of Community Law’ in J Shaw and G More, New Legal Dynamics of European Union (Oxford, Clarendon Press, 1995). See also E Bringh Jörgensen, Union Citizens—Free Movement and NonDiscrimination (Copenhagen, Jurist—og Ökonomforbundets Forlag, 1996); L Hantrais, Social Policy in the European Union (London, Macmillan, 1995); I Ostner and J Lewis, above n 5; M O’Brien et al (eds), Women, Equal Opportunities and Welfare (The Cross-National Research Group, Great Britain, 1990). 190 I Moebius and E Szyszczak, ‘Of Raising Pigs and Children’ (1998) 18 Yearbook of European Law 125. 191 Below, ch 3 at I, 2.

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104 Social Security and Gender An exception to this is the Nordic Convention on Social Security, where the Convention applies on the ground of residence within the territory of one of the contracting states.

1. Women and the Co-ordination of Social Security Systems within the European Union Like other international statutes, Reg 1408/71 is drawn upon the assumption of the male breadwinner migrant worker. As discussed in the following chapter, the assumption is that males migrate autonomously; female migration has traditionally been conceived as being of a secondary nature. It is considered that, to the extent that women move, they do it as tied-migrants, that is to say, following the male head of the family. Thus, female migration is family-centred and not economically induced. As a consequence, the inclusion of men in the scope of the Regulation has been envisaged as being based mainly on the pursuit of an economic activity, while the inclusion of women has been envisaged as being primarily based on their family/marriage bond with a (male) worker. There is no direct indication that Reg 1408/71 envisages different roles for men and women, but the gender bias is evident in several provisions, mainly through the overwhelming use of the pronouns like ‘he’ and ‘his’ when referring to ‘the worker’.192 Marriage has thus been the second main assumption of the Regulation and the ground for the social security protection of women193 Family/marriage is also the second major ground for the application of the new Reg 883/04. Thus, the system established by the new Regulation is not purely individual.Although it is easier for anyone who is covered by a social security system on an individual basis to be covered by the Regulation as well, family bonds also constitute a basis for the application of this Regulation. This combination of individual and family aspirations may well be proved to be to the benefit of migrant women—as it corresponds to their dual capacity as workers and/or family members/wives—despite the fact that gender issues were given not attention in the discussions preceding Reg 883/04. Despite the general development of a gender dimension in academia and politics, evident even at the European Union level,194 gender issues have not yet been specifically addressed either within the framework of Reg 1408/71 and efforts to modernise it or within the framework of Reg 883/04.

192

See eg Art 20 where reference is made to the frontier worker and members of ‘his’family. It emerges from informal discussions that several experts consider this language to be gendered, but no academic discussion has developed concerning this issue. 193 See also E Rentola, ‘Coordinating the Social Security of Women Moving Between Member States—A Case of Parental Benefits’ in L Kaliiomaa-Puha (ed), Perspectives of Equality—Work, Women and Family in the Nordic Countries and EU (Copenhagen, Nordic Council of Ministers, 2000). 194 See eg C Hoskyns, Gender Politics in the European Union: The Implications of Mainstreaming, paper presented at the Gender and Society seminar at the University of Stockholm, 22 March 2001.

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Concluding Remarks 105

CONCLUDING REMARKS

The discussion of gender and social security in this chapter has shown that the social protection of women is a complex issue involving inter alia feminist intervention and demographic concerns. The social security protection of women has been based on different grounds depending on the welfare model developed in each country. Such protection was originally envisaged through derived rights, presupposing the existence of a valid marriage with a worker protected by a system. Nevertheless, as female employment was a fact, employment was also a ground of social security rights for women. In order to facilitate female employment, special schemes—in particular maternity schemes—were gradually established. The development of universal schemes entailed the availability of a third ground for social security, namely residence within the national territory of a state. On the other hand, international co-ordination systems, including the coordination system of the European Community, have traditionally been based on the assumption of a male breadwinner moving to other states to seek work, accompanied by his family. Thus, individual social security rights have traditionally been based on employment for the worker. Members of his family have derived rights to social security. For women, this means derived rights based on marriage. Residence as ground for social security in a trans-national context has only been envisaged within the framework of the Nordic Convention on Social Security. Each of these grounds for belonging to a social security system has proved problematic in one way or another. No system or model has succeeded in providing women with sufficient social security protection. Against the background of rapidly changing socio-economic conditions, the modernisation of national systems has been a major issue of concern. Within the framework of demands for modernisation, situations of primary importance for women have attracted interest, and the adjustment of social security systems for women has been discussed. Such discussion was also facilitated by the development, in general, of a gender perspective in theory and politics. The main response of the systems to challenges with gender implications has been a gradual individualisation of social security benefits. The individualisation trend, though, has been criticised for dismantling the protection women need in many cases, and for demoting them to second-class clients of the welfare systems. Modernisation has been a key word even in relation to the co-ordination system of the European Community. As stated in the previous chapter, several new situations have attracted interest, gaps in the system have been pointed out, and proposals for amendment have been put forward. Nevertheless, situations of gender interest, mainly those concerning work interruptions and changed family conditions, have not attracted any noteworthy interest in the discussions regarding modernisation of the system.195 This book focuses on situations of work interruptions and changed 195 Studies addressing these issues to the best of this writer’s knowledge, are M Sakslin ‘Social Security Co-ordination—Adapting to Change’ (2000) 2 European Journal of Social Security 169; E Rentola, above n 193; and P Foubert, above n 59.

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106 Social Security and Gender family conditions. Reasons exist to assume that these situations may be even more problematic at a trans-national level, where the co-ordination systems operate, than they are at national level. This is the focus of the next chapter, namely, how often these situations may occur in a trans-national context of movement, and whether they should be taken into consideration in discussions about modernisation.

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3 Female Migration and Implications for Social Security INTRODUCTION

This chapter focuses on the relevance of the situations chosen for examination in this book with respect to the European Union’s social security system of coordination. The focus on the extent to which they may constitute risk situations which the co-ordination system must adjust to. These situations form part of the changed labour, family and demographic conditions, constituting major challenges for the national social security systems. The issue here is whether they also constitute challenges for the co-ordination system. In addition, the changing nature of migration and the pressure it exerts on the coordination system is discussed in this chapter. Migration, in particular economic migration, formed the background for all co-ordination efforts as well as the original context of Reg 1408/71. Migration, however, in particular migration within the European Union, is currently of a changing nature. This changing nature is a further challenge for the co-ordination system. For instance, the increase in skilled labour migration has exerted severe pressure on the posting provisions of Reg 1408/71. As a result, the amendment of these particular provisions has been a major issue within the framework of efforts to modernise the Regulation, and particular provisions are now included in the new Reg 883/04. The question raised here is whether female migration is also of a changing nature and whether such development should also be perceived as a challenge to the system. In the first section of the current chapter, the general phenomenon of migration is described briefly,1 with an emphasis on migration within the 1 Migration is a global phenomenon of a complex nature, involving a wide range of aspects, from the economic and political to the social and psychological. There is an extensive literature with regard to these various aspects of migration. However, many topics still have not been researched. Literature on international migration includes S Castles and M Miller, The Age of Migration. International Population Movements in the Modern World (London, Macmillan, 1998); A Findlay, ‘Extra-Union Migration: The South-North Perspective’ in P Rees et al, Population Migration in the European Union (Chichester, Wiley, 1996); N Falchi,‘International Migration Pressures’ (1995) 22 Affari sociali internationali 137; J Blasche, ‘International Migration and East-West Migration: Political and Economic Paradoxes’ (1991) 11/12 Migration: European Journal of International Migration and Ethnic Relations 5; C Kuptsch and R De Beijl, ‘International Labour Migration. Policy Options for Sending and Receiving Countries’ (1995) 32 Studi Emigratione/Études Migrations 226; H Körner, ‘Future Trends in International Migration’ (1991) 26

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108 Female Migration and Implications for Social Security Union2 before going on to focus on the nature of female migration in particular. It should be added that migration is seen here as a general phenomenon, and no attention is paid to specific forms of migration, such as, for example, frontier migration. In the second section, there is an investigation into whether situations that are problematic for the social security protection of women as raised in the previous chapter, in particular work interruptions and changed family conditions, are also problematic in relation to the co-ordination system. The impact of migration on the employment and marital status of women is discussed with the help of migration and sociological research.

I. MIGRATION AND FREE MOVEMENT IN THE EUROPEAN UNION

The phenomenon of migration, as well as the right to free movement conferred upon citizens of the European Union, is discussed in this section. Special attention is paid to the characteristics of female migration within the Union.

1. Migration in Europe: General Migration is as old as history itself, including European history. Prior to the First World War, population movements in Europe were free of restrictions. However, in the years following, these movements became so extensive that governments felt the need to control them. Restrictions as to the admission of foreigners were further intensified after the end of the Second World War. Two factors lie behind the large population movements: economic and political. The enormous migratory waves just after the Second World War were more politically motivated.3 In the years following the war, however, political migration Intereconomics 41; E Todisco, ‘Intellectual, Professional and Skilled Migrations’ (1993) 30 Studi Emigratione/Études Migrations 574; Eurostat, Push and Pull Factors of International Migration. A Comparative Report (2000). A valuable source is the International Migration Review, which is published quarterly by the Center for Migration Studies of New York. In this chapter, efforts have been made to confine, to the extent possible, the description of the phenomenon of migration within European borders. 2 It is almost impossible to speak of European migration without reference to the European Union, not only because migratory movements within the Union are a significant parameter of European migration, but also because the majority of migratory flows on the continent are to the Member States of the Union. 3 The political reasons, however, did not diminish the economic significance of these flows. Expellees from the former German territories in Poland represented a significant addition to the German labour force, while it was estimated that seven million workers, in the form of refugees from East Germany, joined the labour force in West Germany until the erection of the Berlin Wall. See G Yannopoulos, ‘Economic Integration and Labour Movements’ in GR Denton (ed), Economic Integration in Europe (London, Morrison & Gibb, 1969), at 236. In the latter case at least, it was not always clear whether motives were purely political or co-existed with economic ones; see J Salt and H Clout (eds), Migration in Post-War Europe: geographical essays (London, Oxford University Press, 1976), at 21. The waves of refugees arriving from the countries of southern Europe during periods of dictatorship in those countries are another example of migration for political reasons.

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Migration and Free Movement in the European Union 109 declined significantly and was replaced by voluntary movements in the search for work.4 Mass labour migration to the industrialised countries of Western Europe began in the 1960s, mostly on an organised ‘guest-worker’ basis. On one hand, there was a group of countries with many immigrants (France, Germany and Belgium in particular and, to a lesser extent Sweden and Switzerland); and on the other hand, a group of emigration countries (Italy, Spain, Portugal, Greece and Ireland).5 The system of organised recruitment of low skilled foreign labour ended with the oil crisis in 1973.6 Migration for political reasons can be distinguished from migration for economic reasons using some characteristic features. Migration for economic reasons is voluntary, concerning mostly workers leaving their families behind and, generally, intended to be temporary.7 An essential characteristic of the temporary recruitment system was that after recruitment, host country employers might retain selected foreign workers, sending the remainder back upon expiry of their contract, replacing them as needed with their compatriots.8 In the last few decades, European migration has entered a new phase. Labour migration, at least within the European Union, involves to a large extent the migration of highly-qualified staff, often intra-firm migration. At the same time, another kind of migration with unclear economic or political motives has been growing, in addition to illegal migration.9 Skilled migration, in particular from Eastern to Western European countries, has reached such proportions that it has been said that 4 Migration for economic reasons is linked with the rise and unequal development of capitalism, which led to concentration of capital and labour shortages in some countries and surplus of labour in others. For a brief commentary on the question of why the system of labour migration instead of capital transfers was employed on a much larger scale in the case of Western Europe, see S Paine,‘The Changing Role of Migrant Labour in the Advanced Capitalist Economies of Western Europe’ in R Griffiths (ed), Government, Business and Labour in European Capitalism, Papers Presented at the January 1977 Conference of the University Association for Contemporary European Studies (London, Europotentials Press, 1977), at 199–200 and 211. For the role of demographic actors, see J Salt, ‘International Labour Migration: The Geographical Pattern of Demand’ in J Salt and H Clout, above n 3, at 82–83. See also X Lannes, ‘International Mobility of Manpower in Western Europe:II’ (1956) 73 International Labour Review 135. 5 W Molle, The Economics of European Integration (Aldershot, Dartmouth, 1990), at 201. Some writers distinguish a third group of countries, namely the Netherlands and the United Kingdom, which functioned as both emigration and immigration countries at various times (J Salt and H Clout, above n 3, at 24). 6 At the end of 1973, the proportion of the total labour force consisting of migrant workers was 12% and 10% for Germany and France respectively, but the importance of foreign labour in some industries was much greater. Thus, 35.7% of all employees in West Germany metal industries in 1973 were foreigners. At the EEC level, in 1973 the migrant population amounted to 7% of the total labour force. It was estimated that it constituted the sixth largest ‘country’ of the Community in terms of size of population, between Belgium and the Netherlands; see J Salt and H Clout, above n 3, at 82 and 85. 7 W Molle, above n 5, at 202. 8 As to the utilisation of migrant labour and the different historical phases of the system, see S Paine, above n 4, at 202 and 209 et seq; as to the difference between pre- and post-war migration, see S Leibfried and P Pierson (eds), European Social Policy: Between Fragmentation and Integration (Washington DC, The Brookings Institution, 1995), at 235. 9 Mass migration for asylum purposes is generally regarded as a kind of betterment migration or, in some cases, as illegal migration by different means. International migration streams directed to Europe, in particular to the countries of the European Union, are left outside the scope of this chapter.

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110 Female Migration and Implications for Social Security a ‘brain drain’ from these countries is occurring.10 Other considerable groups of immigrants are people entering Europe for family re-unification and family formation purposes, as well as ethnic groups of diaspora returning home.11 With regard to internal migration within the European Union in particular, much of the labour migration at present consists of highly qualified workers, people with managerial or professional qualifications, often moving within the framework of component companies of one large firm. Future labour demand is also expected to affect people with higher qualifications.12 This migration of highly qualified staff, however, can take different forms. It need not be of a permanent character, precisely due to geographical proximities within Europe. Instead, it can take the form of relatively temporary and short-term (project-) migration, such as weekly stays or business trips.13 Barriers such as language, habits, culture and personal attachments still hinder the mobility of labour, but their importance is seen as diminishing rather rapidly, especially with regard to young people who are used to travelling, staying and studying abroad, and who are fluent in other languages.14 Salary differences between the countries are allegedly the strongest incentive for migration, but other factors such as a positive labour market climate and stable economic conditions in the host country can play a role as well. Some are of the opinion, however, that the migration of manpower within the Union is tending to stabilise or even decrease.15 The development of new technology is seen by some as inducing more short-term movements in the future rather than long-term migration, and slowing the rate of mobility in general. Furthermore, another group of intra-Community migrants consists of pensioners who are attracted by the sunny south, in particular Spain, Portugal and Greece. Finally, the traditional emigration countries of southern Europe have experienced considerable flows of returning migrants.16 The history of European post-war migration is considered to include four phases: the periods of post-war adjustment and decolonisation, labour migration, restrained migration, and, finally, the dissolution of socialism and later.17 The first 10 T Paganoni and E Todisco (eds), ‘Skilled Migrations’ (1995) 117 Studi Emigrazione/Études Migrations 223. 11 D Coleman,‘Migration: Facts and Figures’ in European Foundation for the Improvement of Living and Working Conditions (ed), European Conference on Migration and the Social Partners—Proceedings, Dublin 9–10 December 1993 (Luxembourg, 1994). 12 Ibid. See also T Straubhaar and A Wolter, ‘Current Issues in European Migration’ (1996) 31 Intereconomics 267, at 269. As to migration in the European Union and in Europe in general, see P Rees et al, above n 1; K Zimmermann, ‘Tackling the European Migration Problem’ (1995) 9 Journal of Economic Perspectives 45; Eurostat, Patterns and Trends in International Migration in Western Europe (2000). As to a global perspective, see T Straubhaar and A Wolter, ‘Globalisation, Internal Labour Markets and the Migration of the Highly Skilled’ (1997) 32 Intereconomics 174. 13 T Straubhaar and A Wolter, above n 12. 14 See also L Hantrais, Social Policy in the European Union (London, Macmillan, 1995), at 179–81. 15 European Commission, Social Europe, Supplement 1994. 16 M Poulain, ‘Migration Flows Between the Countries of the European Union: Current Trends’ in P Rees et al, above n 1. 17 See K Zimmermann, above n 12, at 46–47. See also R Münz, ‘A Continent of Migration: European Mass Migration in the Twentieth Century’ (1996) 22 New Community 201.

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Migration and Free Movement in the European Union 111 period, that of post-war adjustment and decolonisation, covers the period from 1945 to the early 1960s. The second, from 1955 to 1973, was a period of predominantly low-skilled labour migration. This was followed by the period of restrained migration, starting in 1974 and terminating in 1988. This period was dominated by family reunification migration,18 following a cessation in the recruitment of foreign labour in the aftermath of the first oil price shock and in the face of increasing social tensions, as well as migration induced by political reasons. It is believed that the number of illegal immigrants rose significantly during this period. Finally, the last period began in 1988. It refers to east-to-west migration involving heavy flows of asylum seekers and refugees induced by the fall of communist regimes in Eastern Europe, comprising in large part ethnic Germans moving to Germany.19 1.1 The Right of Free Movement in the European Union The period when the EEC Treaty was being negotiated was a time of growing labour migration. Most of the countries participating in the negotiations, and especially West Germany, were experiencing shortages of labour in their national markets. They were therefore eager to attract foreign labour. Italy, on the other hand, was suffering from chronic unemployment problems. The Netherlands, although to a lesser extent, also had unemployment problems. These two countries were therefore anxious to get rid of some of their labour surplus. Italy in particular, which had been the main source of migrant labour in the post-war years, took much of the initiative for the inclusion of the free movement provisions in the Treaty.20 In addition, the free movement of labour is inherent in the concept of economic integration and was recognised as essential in the discussions for closer economic co-operation among the European states.21 It was initially a right only for economically active people. Consequently, it was not a kind of general right conferred to all people, although it was contained in the provisions of Title III of the Treaty, which referred to the free movement of ‘persons’ in general, with no further specification. Free movement, however, was in any case linked to the pursuit of an economic activity. 18

Largely dominated by women, a fact perceived as a ‘likely reason for the relative academic and policy neglect of this form of migration in Europe’; see E Kofman, ‘Female “Birds of Passage” a Decade Later: Gender and Immigration in the European Union’ (1999) 33 International Migration Review 269, at 286. This period, according to some writers, signifies a period of ‘feminisation of migration’; see below, at 2. 19 As to the East-West migratory tensions after the fall of the East European regimes, see M Kupiszewski, ‘Extra-Union Migration: The East-West Perspective’ in P Rees et al, above n 1. See also D Thränhardt, ‘European Migration from East to West: Present Patterns and Future Directions’, and C Wallace et al, ‘The Eastern Frontier of Western Europe: Mobility in the Buffer Zone’, in (1996) 22 New Community 227 and 259 respectively. 20 For an account of the first steps towards the liberalisation of movements, the difficulties encountered and the roles of the Commission as a ‘driving motor’ and Italy in this early phase, see K Dahlberg, ‘The EEC Commission and the Politics of the Free Movement of Labour’ (1968) Journal of Common Market Studies 310; J Holloway, Social Policy Harmonisation in the European Community (Westmead, Gower, 1981), at 252 et seq. 21 Above, ch 1 at II, 2.1.

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112 Female Migration and Implications for Social Security Gradually, the right to free movement was expanded to practically all citizens of the Union, irrespective of whether an economic activity was being pursued. Three Council Directives of 1990 granted the right of residence in any Member State to all nationals of Member States who did not enjoy this right under the other provisions of Community law, and, in particular, to employees and self-employed people who had ceased their occupational activity and to students, as well as to the families of people who fell within these categories.22 However, the right of free movement and residence in another Member State of economically non-active people, granted pursuant to these three Directives, was subject to a strict reservation. The people concerned must possess sufficient resources to avoid becoming a burden on the social security and the social assistance systems of the host Member State during their period of residence. The right to free movement was further entrenched after the Maastricht and Amsterdam Treaties as a fundamental right for all citizens of the Union,23 and as a component of the very notion of European citizenship itself.24 Its political development thus seems to have run in line with the vision of the founding fathers of the Community. Hans von der Groeben, one of the two draftsmen of the Spaak report and a member of the Commission from 1958 until 1970, wrote:‘Not only is freedom of movement an integral part of the market-economy concept; it is also one of the basic freedoms fought for in 19th-century Europe. Without such freedom of movement, the EEC would not have represented progress, if “integration” is to mean not only a merger of state powers and the creation of a larger economic area but also the consolidation and interweaving of cultural and human relationships.’25 However, despite its expansion and its institutional reinforcement during these years, the right to free movement with the inherent prospect of absolute liberalisation of movement has always been accompanied by fears. During the first phase of the Community, the immigration countries of the time, and especially France, were worried about the potential of inducing mass movements from low-income countries, and especially Italy, to the high-income ones. The right to free movement has never actually been intended to create massive migrations. Thus, even in the limited economic context of the European Economic Community, freedom of movement was established in stages, often through long and complicated processes, 22 Council Directive 90/364/EEC of 28 June 1990 on the right of residence (OJ 1990 L180/26); Council Directive 90/365/EEC of 28 June 1990 on the right of residence for employees and self-employed persons who have ceased their occupational activity (OJ 1990 L180/28); and Council Directive 90/366/EEC of 28 June 1990 on the right of residence for students (OJ 1990 L180/30). Directives 90/364 and 90/365 were replaced by Dir 04/38 ([2004] OJ L158/77). 23 See Articles 3(1)(c), 14(2), 39 (formerly 48), 73i(a) and 73j(1) of the Treaty Establishing the European Community, as amended by the Amsterdam Treaty. 24 See Art 18 (formerly 8a) of the Treaty Establishing the European Community, as amended by the Amsterdam Treaty. As regards the development and content of the right of free movement, see eg PJG Kapteyn and Ver Loren van Themaat, Introduction to the Law of the European Communities (The Hague, Kluwer Law International, 1998). 25 H Von der Groeben, The European Community. The Formative Years: The Struggle to Establish the Common Market and the Political Union (1958–66) (Luxembourg, Commission of the European Communities, 1985).

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Migration and Free Movement in the European Union 113 where many issues were highly controversial and heavily debated. As a result, the relevant Community regulations were very narrow in their scope at the beginning—they only applied to salaried workers, while other categories such as seasonal, frontier and non-salaried workers were excluded. Within this context, the need for a European regional policy as a complement to the policy of free movement was recognised very early on, and was considered to be one of the objectives of the Community.26 In the years that followed, the accession of new Member States was often accompanied by restrictions on the right of movement and transitional periods of several years, as in the cases of Greece, Spain and Portugal. Only those countries that did not invoke fear of a mass export of their labour force, such as those which joined the Community in the enlargement of 1995—namely Austria, Sweden and Finland—were granted full freedom of movement immediately upon entry.27 Fears about migratory waves have also been expressed with regard to the latest, eastward enlargement of the Union.28 Such fears reached almost panic proportions as it was believed that differences in salaries and standards of living between the new and the old Member States would induce flows of ‘social tourists’ after the access of the new Member States, and the majority of the old Member States introduced transitional rules as to the right of free movement for the citizens of the new Member States. Intra-community migration, however, has been very low. In 1995, 5.6 million EU citizens were living in a Member State other than their own, a figure representing less than 2 per cent of the total population.29 The migratory flows that were feared after the accession of new Member States never materialised. On the contrary, the free movement of people is the least invoked freedom within the Single Market. The Commission in 1996 appointed a high-ranking working group to investigate the 26

Regarding these background fears and expectations, see W Molle and A Van Mourik,‘International Movements of Labour under Conditions of Economic Integration: The Case of Western Europe’ (1988) 26 Journal of Common Market Studies 317, at 337; T Straubhaar,‘International Labour Migration within a Common Market: Some Aspects of EC Experience’ (1988) 27 Journal of Common Market Studies 45, at 54; ILO, Social Aspects of European Economic Co-operation: Report by a Group of Experts (Geneva, Studies and Reports NS 46, 1956), at paras 242–3, 245–7 and 274; N Falchi, ‘Le régime définitif de la libre circulation et l’immigration des pays tiers’ (1971) Droit social 17; X Lannes, above n 4; W Molle et al, Regional Disparity and Economic Development in the European Community (Saxon House, Teakfield Ltd, 1980). For a discussion of the motives behind the insertion of the free movement provisions, see J Holloway, above n 20, at 254 et seq; and H ter Heide,‘The Free Movement of Workers in the Final Phase’ (1968–9) 6 CML Rev 466. 27 On the contrary, at least some of the new Member States were worried about the prospect of extended emigration, mostly as regards their skilled labour. According to an article published in a Swedish daily, the Dagens Nyheter, on 18 April 1995, the Swedish Labour Market Authority (AMS) was anxious about developments that showed an increasing number of qualified workers seeking jobs in other countries, mostly because of higher salaries in those countries. Emigration of university-educated people was three times higher than high school graduates. It was feared that if this development continued, the effects would be devastating for the needs of the internal market. 28 See eg E Hönekopp and H Werner, ‘Is the EU’s Labour Market Threatened by a Wave of Immigration?’ (2000) 35 Intereconomics 3; T Straubhaar and A Wolter, above n 12; T Boeri and H Brücker, The Impact of Eastern Enlargement on Employment and Labour Markets in the EU Member States, Final Report (Berlin, 2000), available at http://europa.eu.int/comm/dgs/employment_social/ enlargement_en.pdf. 29 Eurostat, Europe in Figures, 5th edition (2000).

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114 Female Migration and Implications for Social Security reasons for the low mobility of labour within the Community.30 The European population, and the labour force in particular, has proved more immobile than was anticipated in economic integration theories.31 Nevertheless, the promotion of the free movement of workers has always been a key feature, initially for the establishment of a single market and later even for the development of a social policy and a social dimension of the Community. Documents such as the Green Paper on European Social Policy—Options for the Union,32 the White Paper on European Social Policy—a way forward for the Union,33 the Medium-term social action programme (1995–7),34 the Social action programme (1998–2000),35 and the Social Policy Agenda36 all refer to the need to promote this aim.

2. Female Migration The picture of migration painted above corresponds to a predominantly economic model of migration. Apart from forced migrations for political reasons, where virtually no choice is given, people are supposed to make decisions to move based on economic motives, either on an individual or a family level, where it is typically assumed that migration is driven by the male head of the household and that women follow their partners for family reasons.37 Thus, migration, when voluntary, is of an economic nature. The economic approach of migration underpins both common perceptions of migration and policy measures in the area. It suggests that migration is primarily a masculine phenomenon. Female migration, when addressed, is viewed as migration of a secondary nature, referring mostly to the migration of married women. The economic approach, with its inherent focus on male migration, has been challenged by an increasing number of authors, particularly in the context of a growing interest in taking into consideration the gender factor in migration research. Thus, while the interface between migration and gender long remained ‘a neglected area of research’, it is now a rich area of ongoing research. Attention has been given to the increasing role of women in all regions and all types of migration 30

T Straubhaar and A Wolter, above n 12, at 271. As to this issue see T Straubhaar, ‘Arbetskraftens fria rörlighet’, EFTA Bulletin 4/87, pp 9–12, and above n 26. It should also be noted that the question of how the labour force will react in terms of mobility has been an issue not only with respect to geographical enlargements, but also as regards new steps towards integration taken by the Community. See eg H Werner, ‘Free Movement of Labour in the Single European Market’ (1990) 25 Intereconomics 77. 32 COM (93) 551 final. 33 COM (94) 333 final. 34 COM (95) 134 final. 35 COM (98) 259 final. 36 COM (00) 379 final. 37 According to the two main economic theoretical models of explanation of migration, ie the macro/micro-economic theory and the family resource theory, see L Ackers, Shifting Spaces. Women, Citizenship and Migration within the European Union (Bristol, Policy Press, 1998), at 145. 31

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Migration and Free Movement in the European Union 115 and to the growing ‘feminisation of migration’.38 The economic focus, which leads to the inherent conclusion that migration is a predominantly male phenomenon, as well as the family focus with the implication of tied migration on account of women, has been the subject of critical review. Not all of the criticism, however, has concentrated on the economic bias. Some scholars find that there are good reasons for this bias, notably the central role played by the (capitalist) economy within all our lives. In addition, the economic bias is equally apparent in studies of gender and migration. The fallacy of the economic approach, it is argued, rather lies in the public/private dichotomy. As this dualism is now increasingly being undermined both at the ideological and at the more material level, reflected in the increasing engagement of women in paid employment, studies of the interface between gender and migration must be located within the context of this change and evolution.39 From a feminist perspective, much of the criticism focuses on the invisibility of women in the migration process. The economic focus was challenged as obscuring the role of women as autonomous agents in this process. It has been argued that the pervasive assumption that the international migrant is a young, economically motivated male has overshadowed the reality of migration streams dominated by women. For instance, legal immigration to the United States—still very much the largest of all international flows—has been dominated by females for the last halfcentury, although few researchers and even fewer policy makers are aware of this.40 The economic approach has been further challenged by researchers studying female migration within the framework of the European Union. Ackers points out that mainstream migration literature has perpetuated a dual myth that migration is male-dominated and that the motives for migration are exclusively economic. Consequently, it is assumed that women do not migrate as individuals, in their own right, and when they do move, they do so as passive companions of male partners.41 Researchers challenging the economic approach have emphasised that factors such as ethnicity, class and gender have to be examined in order to understand 38

S Castles and M Miller, above n 1, at 9. For an account of gender migration theories and the current state of research, see P Boyle and K Halfacree (eds), Migration and Gender in the Developed World (London, Routledge, 1999), at 1–15. 40 M Houstoun et al, ‘Female Predominance of Immigration to the United States since 1930: A First Look’ (1984) 18 International Migration Review 908.A similar point is made by Shirley Hune, who points out that a major trend in international migration is the recruitment of women as migrant workers, both documented and undocumented, as often as men; see S Hune ‘Migrant Women in the Context of the International Convention on the Protection of the Rights of All Migrant Workers and Members of their Families’ (1991) 25 International Migration Review 800. See also S Pedraza,‘Women and Migration: The Social Consequences of Gender’ (1991) 17 Annual Review of Sociology 303; M Morokvasic, ‘Birds of Passage are also Women’ (1984) 18 International Migration Review 886; RF Schoeni, ‘Labor Market Outcomes of Immigrant Women in the United States: 1970 to 1990’ (1998) 32 International Migration Review 57. Other authors, however, have found that women are in general less geographically mobile than men, although they did not question the role of women as autonomous factors of economic migration; see R Rosenfeld and JA Jones, ‘Patterns and Effects of Geographic Mobility for Academic Women and Men’ (1987) 58 Journal of Higher Education 493. See also H Zlotnik,‘The South-to-North Migration of Women’ (1995) 29 International Migration Review 229. 41 L Ackers, above n 37, at 148 with references. 39

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116 Female Migration and Implications for Social Security migration.42 They have also stressed that female migration can be better understood through the lens of other approaches, for instance through a social networks approach43 or a life-course approach suggesting that the motives of migration can change throughout a lifetime.44 Dimensions, such as spatial dimensions referring to differences between places, must also be taken into consideration in order to understand patterns of female migration.45 The recognition of the need to focus more on women and ‘to bring them out of the shadows of migration’ seems to be steadily gaining ground.46 At the same time, within the framework of the economic analysis of migration, special attention has been paid to dual career households. 2.1 Female Migration within the European Union The assumption that migration is an economic and predominantly male phenomenon is further reinforced in the context of the European Union, where mobility is assumed to be, and also desirable as, the behaviour of economically active people. The economic models of analysis of migration, especially those adopting a family approach, also underpin Community policy and legislation in this field, Reg 1408/71 in particular. Within the framework of the economic, predominantly male, assumption of migration, female migrants are mainly perceived as ‘tied’ migrants, that is to say as wives emigrating either at the same time as their families or later, alone or possibly with children, to join husbands already established abroad. In addition, no distinction is usually made between intra-Union migration and immigration of third country nationals to the Union. This view can be seen in several documents, for instance in the report submitted by the Commission’s Expert Group on Women in the Labour Market, whose remit was to assemble and analyse data on migrant women at the beginning of the 1980s when migrant women emerged as a key group requiring Community support.47 This view has subsequently underpinned several 42

S Pedraza, above n 40. L Miller Matthei, ‘Gender and International Labour Migration: A Networks Approach’ (1996) 23 Social Justice 38. The theory suggests a focus on migration as a gendered process of trans-national network building, where women, both migrant and non-migrant, actively participate in the building and maintenance of the ties that link migration sending and receiving communities. 44 L Ackers, above n 37. 45 T Fielding and S Halford, ‘A Longitudinal and Regional Analysis of Gender-specific Social and Spatial Mobilities in England and Wales 1981–1991’ in P Boyle and K Halfacree, above n 39. 46 This is the case not only in research and academia, but also in the political fora, such as within the framework of international organisations. In a meeting of the United Nations Expert Group on the Feminisation of Internal Migration, for example, it was recognised that such a view is an obstacle to advancing understandings of the causes and consequences of female migration, and the need to develop new ways of categorising and describing female migration was stressed. See RE Bilsborrow and H Zlotnik, ‘Preliminary Report of the United Nations Expert Group Meeting on the Feminisation of Internal Migration’ (1992) 26 International Migration Review 138. See also the United Nations Population Fund (UNFPA), ‘State of the World Population—1993’ (1993) 19 Women’s International Network News 4. 47 R Knudsen et al, Migrant Women in the European Community, with Particular Reference to their Working Lives (Commission of the European Communities V/1955/88, 1987). 43

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Migration and Free Movement in the European Union 117 Community measures in this area.48 At about the same time, however, attention also began to focus on the independent nature of female migration and the possible emergence of a new generation, a ‘new wave’, of female migrants.49 The economic and male-centred understanding of European migration has been criticised in theoretical and case study literature, emphasising the gender aspect and the active role played by women in international migration.50 In the context of the European Union in particular, the economic approach was challenged by Louise Ackers.51 Ackers’ research focuses on intra-Union migration, an area where ‘relatively little interest has been shown’.52 According to Ackers, the lack of interest and research concerning internal European migrant women, despite the fact that they constitute an interesting group in their own right, comes down to the presumption of a privileged citizenship status that European women are assumed to enjoy. She argues that preoccupation with concerns about immigration from outside the EU and the status of people within the Union who do not possess Community nationality, however important, have tended to reinforce the presumption of a duality of entitlement based on ownership of EU nationality, creating the impression of a broad equality among those defined as EU citizens. Consequently, the position of internal migrants is typically dismissed in research and the academic debate, on the presumption of relative privilege, broad cultural homogeneity (within the Union) and broad equality of citizenship status. At the theoretical level, the invisibility of women in the theoretical analysis is partly attributed to deficits in the methodological approaches. Ackers holds the view that as the analysis has relied on aggregate data, it has failed to capture the 48 See, in particular, European Commission, New Community Action Programme on the Promotion of Equal Opportunities for Women (1982–5) (COM (81) 758 final); Equal Opportunities for Women— Medium Term Community Programme 1986–1990 (COM (85) 801 final); Practical guide to European Community grants available for the creation of women’s local employment initiatives, V1476/87 (1987); Report of the Commission on the implementation of the resolution to combat unemployment amongst women (COM (88) 713 final); The social situation and employment of migrant women (COM (88) 743 final). See also Draft Council Resolution on Guidelines for a Community Policy on Migration (COM (85) 48 final). The action programmes were adopted within the framework of the equal opportunities policy of the Community. The Action Programme of 1996, however, was the first Action programme to mention migrant women (or other groups of disadvantaged or poor women) directly.As an explanation, it stated that these issues were either outside the competence of the EU or dealt with elsewhere in its policy; see C Hoskyns, Gender Politics in the European Union: The Implications of Mainstreaming, paper presented at the Gender and Society Seminarat the University of Stockholm on 22 March 2001. With regard to Community policy, see also C De Troy, The Specific Training Needs of Immigrant Women— Existing and Recommended Measures to Fulfil Them (Commission of the European Communities V/1909/86, 1986); C De Troy, Migrant Women and Employment (Commission of the European Communities V/928/87, 1987). For an article embracing the same approach, see I Prondzynski, ‘The Social Situation and Employment of Migrant Women in the European Community’ (1989) 17 Policy and Politics 347. 49 C Hecq and O Plasman, La mobilité Européenne des travailleurs feminins dans la Communauté (Brussels, Commission des Communautés Européennes V/378/91-FR, 1990). 50 E Kofman, above n 18. 51 L Ackers, above n 37. 52 In general, more attention has been paid to migration from outside the Community than intraCommunity migration; see R Koslowski, ‘Intra-EU Migration, Citizenship and Political Union’ (1994) 32 Journal of Common Market Studies 369, at 376.

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118 Female Migration and Implications for Social Security complexity of women’s lives and the subjective factors influencing the decision to migrate.53 Ackers argues that the data on female migration within the European Community challenges both of the prevailing economic theories of migration: that migration is predominantly male, and that migration is primarily induced by economic motives. She found that just below 50 per cent of all EU migrants are women—with considerable variations between outgoing and incoming flows of migrants between the Member States.54 In addition, data on the marital status of migrant women did not support the view, at least at the European Community level, that female migration is mainly actually migration of married women following a breadwinning husband. The overwhelming majority (approximately 65 per cent) of the women interviewed within the framework of Ackers’ research had migrated as single women. Only a minority of them (27 per cent of the sample) were married. Furthermore, Ackers points out that available data in the EU context shows changes in women’s marital status over their lifetimes. While many women migrated as single, they subsequently got married and remained in the host state, separating, divorcing, cohabiting or remarrying at different stages of the research. This data, according to Ackers, supports the view that migration is not a manifestly male phenomenon. Not only the rate but also the nature of female migration is changing as well. Women are autonomous, active agents in the migration process. Women do migrate as individuals, in their own right, and not only as passive companions of male partners.55 Further, according to Ackers, European data on female migration challenges even the assumption that migration is predominantly an economic phenomenon. Women migrate for a number of reasons, often inseparable from one another, and these reasons may also vary from time to time during their lifetimes. Women may be involved in a series of decisions concerning one migratory movement or several successive movements, based on different reasons each time. Hence, distinctions are drawn between the initial migration and subsequent phases of migration, between the reasons for going to or staying in another country. The reasons for the initial 53 L Ackers, above n 37, at 148. Statistical shortages and data defects were also recognised by the United Nations Expert Group on the Feminisation of Internal Migration as a factor negatively affecting any adequate study of female migration and its consequences; see RE Bilsborrow and H Zlotnik, above n 46, at 139. As to further references to research studies recognising data shortages, see P Boyle and K Halfacree, above n 39, at 2; D Atkins and S Fotheringham,‘Gender Variations in Migration Destination Choice’ in P Boyle and K Halfacree, above n 39. For a discussion of selected theoretical problems with respect to measuring and collecting data on internal migration, see P Rees and M Kupiszewski,‘Internal Migration: What Data are Available in Europe?’ (1999) 15 Journal of Official Statistics 551. 54 Hence Belgium, Denmark, Germany, France and Ireland are exporters of females, while Spain, Greece, Italy and the UK are importers; see L Ackers, above n 37, at 149–50. These figures are from 1992, prior to the 1995 enlargement, and thus refer only to 12 Member States. 55 That female migration may not be exclusively of a secondary nature is even acknowledged by authors who otherwise embrace an economic, family-centred view of migration. Prondzynski, for example, acknowledges that Irish women constitute an interesting exception to this typical pattern by having a long tradition of leaving their country on their own as young single women. In more recent years, a similar pattern appears to have emerged with respect to the emigration of young Spanish and Portuguese women to France. See I Prondzynski, above n 48, at 348.

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Migration and Free Movement in the European Union 119 decision to come to a country might be partner-related, work and/or study-related, or personal reasons ranging from family and personal networks to the pursuit of personal autonomy or just travel. Often it will be impossible to identify one primary motive: for instance, a woman might state that she came to a new country to travel, to learn the language and/or to work. When it comes to a decision to stay, one of the reasons often mentioned is meeting a partner and building a family in the host country. A reverse picture may also be true, for example, initial partner-related migration and a subsequent decision to stay, after the break-up of the relationship, for employment-related or educational reasons.56 The picture of female migration emerging from Ackers’ analysis is one of migration of a predominantly non-economic nature. It appears to be a complex phenomenon involving several motives and successive levels. Partner-related reasons seem to play the most important role as they tend to become evident at some point in most women’s migratory courses, even if they alone cannot explain the entire phenomenon of female migration. However, despite the overrepresentation of partner-related reasons in the migration process as a whole, and even when migration results in women having to assume a secondary labour market role, research findings do not confirm, according to Ackers, a passive ‘follower’ mentality ‘but rather a sophisticated evaluation of a range of factors influencing their [women’s] overall quality of life and autonomy’.57 Hence, the view expressed in international theory that married women’s migration is of a secondary nature is not confirmed in the context of intra-Community migration. Neither is the view expressed by some feminist writers that women’s tied migration is attributable to the legacy of patriarchy confirmed. The male breadwinner model of migration behaviour is further undermined by the fact that same-nationality couples, the migration of whom underpins most models of migration behaviour, are the minority of all cases where ‘partner’ was cited as a main reason for migration. Only 13 per cent of all partner-related migration cases related to same-nationality couples.58 All other cases referred to couples of different nationalities.

II. THE IMPACT OF MIGRATION ON WOMEN’S EMPLOYMENT AND MARITAL STATUS

Changing labour and family conditions, in particular work interruptions for childcare, changed family forms and increasing divorce rates, jeopardise the social security protection of women. They challenge the grounds upon which this protection has traditionally been based, namely employment and marriage. This 56

See L Ackers, above n 37, ch 5. Ibid, at 169. 58 The figures were somewhat higher for Sweden and Portugal in Ackers’ research, namely 24% and 17% respectively. Despite the higher rates, however, even in these two countries same-nationality couples constituted a minority of all migration cases. 57

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120 Female Migration and Implications for Social Security section examines whether these situations occur even in the context of migration. The aim is to examine whether migrant women also interrupt work in order to take care of children, as well as whether changed family forms and increasing divorce rates occur in conditions of migration. An additional aim is to examine whether migration itself is a factor that exacerbates the occurrence of such situations: Does migration have an impact on women’s employment and marital status?

1. The Impact of Migration on Women’s Employment Status There is an abundant body of migration literature,59 mostly from American researchers, concerning the issue of the impact of migration on women’s employment. Much of this work has focused in particular on dual career households,60 ie on married women. It is thus based on and reinforces the view that female migration is of a secondary nature. Consequently, the migration of single women is mostly left outside the scope of research. Keeping this in mind, the research demonstrates the following: Most researchers appear to agree that married women’s migration is of a secondary nature and that their roles are oriented primarily around their husband’s occupational concerns.61 This also appears to be the case for women with higher educational and occupational status. Researchers determined that, although it was expected that women with greater resources would have greater power in conjugal decision-making concerning migration, women very seldom initiated migration. On the contrary, it was found that most married women, regardless of resources, were secondary migrants and did not find migration to be a vehicle for greater earnings attainment.62 Women who were college graduates were no exception to the rule that when family and career conflicted, family took priority. Educated women altered their career plans and goals to accommodate marital prospects and aspirations where necessary. Approximately four times as many wives followed their husbands’ moves in a traditional family migration pattern as initiated non-traditional family migrations. Even among wives with a college education, most still followed their husbands when the husband found a new job; only a few extremely well-educated women initiated family migrations.63 Some researchers argue that the reason for 59

Referring both to international and national migratory movements. The dual career household is conceived of differently from the dual income household. The former is defined as a household containing two principal adults, in which both partners are engaged in occupations with distinctive and progressive career paths based on ‘commitment’ to the job. The latter is defined as a household where both partners are in paid employment but where either or both have jobs with relatively indistinct career paths; see P Boyle and K Halfacree, above n 39, at 3. 61 N Bonney and I Love, ‘Gender and Migration: Geographical Mobility and the Wife’s Sacrifice’ (1991) 31 Sociological Review 335; D Lichter, ‘Socioeconomic Returns to Migration Among Married Women’ (1983) 62 Social Forces 487. 62 D Lichter, above n 61; G Spitze, ‘Family Migration Largely Unresponsive to Wife’s Employment’ (1986) 70 Sociology and Social Research 231. 63 L Yu et al, ‘The Impact of Family Migration and Family Life Cycle on the Employment Status of Married, College-Educated Women’ (1993) 20 Work and Occupations 233. 60

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Migration and Free Movement in the European Union 121 this is the gendered ‘geography of opportunity’—that is to say, women compromise more because their jobs—in particular teaching and nursing—are less geographically constrained. Others consider that migration has to be understood within the multiple concerns that any individual (person or household) has at any time. Others have drawn attention to the need to focus on the household as a decisionmaking unit, and on the power relations within it.64 Some scholars argue that families do give greater weight to women’s labour market achievement than is assumed by the human capital model of migration, and that the decision to migrate (or to stay) is generally made after considering the wife’s skills and aptitudes.65 Dual career households invest much thought and care in deciding how to develop household location and mobility strategies in order to maximise the benefits (as far as possible) for both individuals and the household—ie how to balance the gains and losses for ‘his’ career, ‘her’ career, and ‘their’ career as a household. The leader then is most likely to be the individual with the better paid and/or more locally constrained career. The key to success is to accept, live and manage the paradox. In that sense, compromise is one of the keys.66 It has also been pointed out that dual career households may develop other strategies for movement. Attempts can be made to make international moves coincide with early parenthood when women are more likely to exit the labour market temporarily.67 The question whether dual career households are in general less prone to move has attracted the interest of researchers. It has also been argued that two-earner families are more likely to be deterred from migration than single-earner families, as gains—mainly for the husband—and losses—mainly for the wife—from migration are primarily attributable to job mobility. As the earner in husband-wife families is almost always the man, it is families with working wives whose migration is most likely to be inhibited.68

64 For an overview of the literature on all these approaches see P Boyle and K Halfacree, above n 39, at 3–10. As to the different migratory behaviours of men and women, in terms of location decision-making and employment status transitions, in another context (rural locations in France), see C DetangDessendre and I Molho,‘Residence Spells and Migration: a Comparison for Men and Women’ (2000) 37 Urban Studies 247. 65 T Cooke and A Bailey, ‘The Effect of Family Migration, Migration History, and Self-selection on Married Women’s Labour Market Achievement’ in P Boyle and K Halfacree, above n 39. Spitze holds the view that if the wife’s employment influences the migration decision, it mainly deters rather than initiates it; see G Spitze, above n 62. 66 AE Green, ‘A Question of Compromise? Case Study Evidence on the Location and Mobility Strategies of Dual Career Households’ (1997) 31 Regional Studies 641. 67 E Kofmann, above n 18, at 285. 68 J Mincer,‘Family Migration Decisions’ (1978) 86 Journal of Political Economy 749. More generally, according to the theory of commitments, the more commitments one has, the less mobile one is. Marriage and children in particular inhibit long-distance moves for both women and men; see N Bonney et al, ‘Migration, Marriage and the Life Course. Commitment and Residential Mobility’ in P Boyle and K Halfacree, above n 39. See also JP Jacobsen and LM Levin, ‘The Effects of Internal Migration on the Relative Economic Status of Women and Men’ (2000) 29 Journal of Socio-Economics 291. There are indications, however, that when family commitments cease, people may become more mobile. 78% of Swedish migrants in 1989 were divorced compare to 42% of the whole population; see SCB, Utvandrare—Vem är det? Demografiska rapporter 1992:2.

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122 Female Migration and Implications for Social Security In one particular feminist analysis, the seemingly willing acceptance of ‘tied migrant’ status and the construction of gendered identities by women was sought by some writers in the legacy of patriarchy. The ability of the dual career household to be seen as any kind of blueprint for a more egalitarian, non-discriminatory division of labour began to be questioned. In addition, it was asked whether the attitudes of tied movers raised issues of ‘quality of life’ and suggestions of an alternative future.69 Now we reach the core issue regarding the impact of migration on married women’s employment, and here we find that an inconsistency in the research findings appears to exist. A number of scholars argue the negative effects of migration. Women fare worse from family migration than men, at least in terms of labour market participation.70 It is argued that family migration tends to reduce the employment rate and earnings of migrating wives, and to increase the employment rate and earnings of their husbands.71 Other scholars point out that migration contributes not only to labour force non-participation and unemployment among married women. It also contributes to other forms of labour force hardship, including involuntary part-time employment and low pay.72 Furthermore, migration also negatively affects employment adequacy among single women.73 The theory of negative effects, however, has been modified by other researchers. Lichter argues that while migration has a significant negative effect on earnings in the short term, the longer term effects are minimal.74 Spitze also came to the conclusion that the negative consequences of migration did not last beyond the first or second year after a move.75 Goyette and Xie emphasise that although immigrant women are less likely than immigrant men and native women to be employed and promoted, once employed full-time they do not appear to earn less.76 Others, while accepting that migration may have different employment consequences for men 69

See P Boyle and K Halfacree, above n 39, at 12–15. P Boyle et al, ‘Family Migration and Female Participation in the Labour Market. Moving Beyond Individual-level Analyses’ in P Boyle and K Halfacree, above n 39. See also E Lundberg Lithman, Kvinnor och migration i ett europeiskt perspektiv (Stockholm, Gotab, 1985), at 27–34, including material indicating segregation, worse working conditions and discrimination in the labour market for migrant women. See also H Werner, ‘The Integration of Foreign Employees in the Labour Market’ (1996) 31 Intereconomics 95, in particular at 99–100. 71 J Mincer, above n 68, at 749–73. 72 D Morrison and D Lichter, ‘Family Migration and Female Employment: The Problem of Underemployment among Migrant Married Women’ (1988) 50 Journal of Marriage and the Family 161. See also L Long,‘Women’s Labor Force Participation and the Residential Mobility of Families’ (1974) 52 Social Forces 342. 73 D Morrison and D Lichter, above n 72. See also R Rosenfeld and JA Jones, above n 40, at 512. With regard to the impact of migration on women’s political engagement and career, see C Nechemias, ‘Geographic Mobility and Women’s Access to State Legislatures’ (1985) 38 The Western Political Quarterly 119. 74 D Lichter, above n 61. 75 G Spitze, ‘The Effect of Family Migration on Wives’ Employment: How Long does it Last?’ (1984) 65 Social Science Quarterly 21. 76 K Goyette and Y Xie, ‘The Intersection of Immigration and Gender: Labor Force Outcomes of Immigrant Women Scientists’ (1999) 80 Social Science Quarterly 394. See also JP Jacobsen and LM Levin, ‘The Effects of Internal Migration on the Relative Economic Status of Women and Men’ (2000) 29 Journal of Socio-Economics 291. 70

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Migration and Free Movement in the European Union 123 and women and that most of the employment adjustments fall upon women, they find that such adjustments need not necessarily be negative.77 Some scholars counter the theory of negative effects by arguing that, on the contrary, family migration even increases the probability of employment among married women, in particular when they are teachers or nurses.78 Other researchers challenge the theory of negative effects by focusing on other spheres of life than the employment sphere. Migration is not as detrimental as other research findings suggest, it is argued, because women themselves do not see its effects as detrimental. Women have a wider repertoire of roles and resources, and they have different expectations as regards their employment possibilities and aspirations than is suggested in the theoretical model of ‘the wife’s sacrifice’. Some play supporting domestic roles while others find acceptable employment. In any case, empirical inquiries show that few women feel any great sense of grievance.79 It is a ‘hegemonic masculinist view’ to evaluate migration primarily through the lens of careers and the labour market, it is argued, when women may be more likely to take into account family commitments, notably the care of children or relatives, and other more ‘grounded’ factors when explaining the rationale for moving or staying.80 In the same spirit, some researchers question the assessment of migration’s effects in only material terms. They argue that migration holds different benefits for women than for men. Migration can result in patriarchal roles in the household being transformed, the woman’s self-esteem being heightened, her capacity to participate as equals in household decision-making being enhanced, and she secures more income with which to actualise her role.81 The disentangling of the impact of migration as such from the impact of family building, as the years of migration usually coincide with the reproductive years in a woman’s life, is another issue of disagreement among scholars. While many researchers consider migration to have its own negative impact, others consider that the negative effects on the employment status of women are not only a result of migration but also of their being in the child-rearing stage of the life cycle, and that these two factors are almost equally important.82 Migrant couples are not different 77 A Green et al,‘The Employment Consequences of Migration. Gender Differentials’ in P Boyle and K Halfacree, above n 39. 78 T Cooke and A Bailey, ‘Family Migration and the Employment of Married Women and Men’ (1996) 72 Economic Geography 38. Contra T Cooke and A Bailey, ‘The Effect of Family Migration, Migration History, and Self-selection on Married Women’s Labour Market Achievement’ in P Boyle and K Halfacree, above n 39, where the authors state that an improved specification failed to support their previous findings, and that ‘family migration has a strong negative impact on women’s labour force participation and hours worked’. 79 N Bonney and J Love, above n 61. Other studies have, however, reported a negative effect of nonworking status on the psychological well-being of migrant women; see J Freidenberg et al, ‘Migrant Careers and Well-Being of Women’ (1988) 22 International Migration Review 208. 80 For references see P Boyle and K Halfacree, above n 39, at 11. 81 S Pedraza, above n 40. 82 N Rytina, ‘The Economic Status of Migrant Wives: An Application of Discriminant Analysis’ (1981) 65 Sociology and Social Research 142; L Yu et al, above n 63.

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124 Female Migration and Implications for Social Security from couples in general in experiencing a temporary scaling down of the wife’s involvement in paid work while children are young.83 The inconsistency of research findings with regard to the negative impact of migration has been attributed by some authors to the fact that the impact of migration on the employment and the earnings of wives differs according to the characteristics of the study respondents, that is to say their educational backgrounds, occupational prestige, and earnings.84 A larger degree of agreement among scholars, however, appears to exist with regard to the impact of migration on the employment status of qualified women. Women of higher educational and/or occupational status may lose the most by migrating.85 Summarising briefly, international research on the impact of migration on the employment status of women has focused mostly on married women. It has been shown that the migration of married women is mainly family orientated, and that it is quite unrelated to the employment or educational status of wives. The predominant theoretical model has been the model of negative effects—the ‘wives’ sacrifice’ model. This model, however, has been strongly challenged by several scholars on various grounds. More agreement, however, appears to exist among researchers with regard to women with higher qualifications, considered potentially as the greatest losers in the context of migration. 1.1 The Impact of Migration on the Employment Status of Women within the Framework of the European Union Research concerning internal female migration in the European Union, and in particular the impact of migration on the employment status of women, has not been developed. The scarcity of sources in the form of data and/or research has the consequence that knowledge about this issue is rather limited.86 It appears, however, that migrant women generally suffer more from work discontinuity and higher rates of unemployment. At the same time, Community statistical data also shows that labour market activity rates for all migrants in general are higher than those for nationals for both sexes, although female activity rates are considerably lower than those of men.87 Nevertheless, activity rates for 83

N Bonney et al, above n 68. L Yu et al, above n 63. See also I Bruegel,‘Who Gets on the Escalator? Migration, Social Mobility and Gender in Britain’ in P Boyle and K Halfacree, above n 39, where the author, examining the ‘paradox’ of conflicting research results, found that with regard to internal migrants to London in the 1980s, social mobility was achieved mostly by young women without children. Tied-movers were shown to have immediate costs in terms of higher rates of unemployment and decline in high-status jobs. See also RF Schoeni, above n 40, on the mixed experiences of immigrant women in the United States. 85 D Lichter, above n 61. See also K Goyette and Y Xie, above n 76; R Rosenfeld and JA Jones, above n 40. 86 Ackers’ book, above n 37, is the primary source of reference for female intra-Union migration issues in this book. The sources referred to by Ackers include data from the European Labour Force Service (ELFS), as well as interviews with migrant women in several countries of the European Community. 87 In comparing the migrant and national populations, it should be noted that the former group is, on the whole, younger than the latter group; see L Ackers, above n 37, at 184. On the other hand, a sizeable 84

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Migration and Free Movement in the European Union 125 women diminish in a reverse relation to the number of children in the household. Both the number and the age of children affect women’s relationship with the labour market. The presence of children under the age of five has the most marked impact. Migrant women, in particular, with children under the age of five were less active than their national counterparts.88 Furthermore, the presence and number of children also has a considerable impact on the number of working hours. Part-time work is quite usual for women with small children, but this pattern is more marked in the case of migrant women, who are engaged in part-time work to a greater extent than local- or non-migrant women. This limited data, however, does not quite reveal the impact of migration on women’s employment status, as it does not facilitate a comparison of the labour market status of migrant women prior to and following migration. Ackers argues that the impact of migration is different for different categories of women, the key factor being their pre-migration employment status. Women in insecure, unskilled work often find similar work in the host state. In contrast, the post-migration experience was affected by the motives of migration with regard to women in highly skilled professions. If their migration was motivated by concerns to develop their own employment trajectories, they may well have achieved career progression. If, on the contrary, their migration was motivated by their partner’s career or family circumstances—which was very often the case—they typically suffered a significant loss in status. This effect could further be aggravated depending on the country of immigration.89 With regard to women whose migration was motivated by employment or career, the research shows that they were generally less likely to have suffered downward career mobility than those women whose movement was motivated by partner-linked considerations. Some women experienced an improvement in their economic status by securing more highly remunerated work. Others experienced improvement not in terms of economic betterment, but in terms of greater professional responsibility and improved professional status. In other cases, women had avoided unemployment or managed to work in areas they felt would not have been open to them if they had not moved.90 In some other cases, however, the group of economically active migrant women may be absent from the statistics, omitted from the labour force count as they are not eligible to be registered as unemployed or do not possess relevant work permits, resorting to the ‘black’ labour market or assisting spouses without receiving regular payment; see European Commission The Social Situation and Employment of Migrant Women (COM (88) 743 final). 88 Ackers considers that the impact of children on the labour activity of migrant women may partially explain their generally lower levels of fertility; see L Ackers, above n 37, at 185, n 3. 89 Ibid, at 185. 90 The geographical pattern of migration determined by the nationality of women and the economic situations of the sending and receiving countries are also important In general, Spanish and Portuguese women who migrated for reasons of employment, perhaps because they were unemployed in their country of origin, benefited from the move to an area where employment prospects were better. Labour market mentality, expressed in terms of male ‘machoism’ and the difficulties women encountered in their effort to realise their career aspirations or simply find work, also appear to have induced migration in some cases, such as in the Italian examples.

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126 Female Migration and Implications for Social Security positive results were less obvious, which made Ackers to point out that ‘it remains difficult to assess in any quantifiable way the impact of migration on career prospects’. While the impact of migration on employment prospects was typically very positive for this category of women, subsequent marriage and partner-determined migrations restricted their financial autonomy. Meeting a partner was one of the main reasons to convert an intended short stay into a longer one. Converting a short and employment-determined migration to a longer, perhaps permanent, partnerdetermined migration marked a significant shift in a women’s employment trajectory. With regard to women whose migration was ‘partner-determined’ from the beginning—‘tied movers’—the research shows that women in lower level, unskilled areas of work often resumed a similar type of work on a casual basis in the host Member State. In contrast, women with professional qualifications and welldeveloped careers who moved because of their partners suffered the severest consequences following migration. Many women suffer serious losses to their personal financial status as a result of the priority attached to the male partner’s career. As Ackers points out, the economic consequences of migration are nevertheless quite complex, as in many cases the move improves the financial status of the family as a whole. The decision of a household to migrate may thus appear to be ‘rational’, but at the cost of increased levels of dependency and loss of personal autonomy for female partners. The fracturing of women’s careers as a result of migration, marriage and caring seems to leave many women on the margins of employment. As shown in Ackers’ study, some women experienced long periods of unemployment while others were forced to accept forms of work not recognised in Community (or indeed national) law, working in the black market (particularly in areas concerned with tourism, language tuition or in family businesses). For a large group of women, the consequences of partner-determined migrations and family formation are a decline in economic status and financial autonomy and a higher level of dependency on partners. Problems in gaining acceptance with respect to qualifications and language competence, together with access to appropriate opportunities in local labour markets and a lack of informal support with care responsibilities, result in high levels of de-skilling and vulnerability to insecure and part-time contracts. These processes particularly affect women who had welldeveloped professional careers or good qualifications prior to the move. The study of European female migration shows that even careers as teachers and nurses— professions generally considered to ‘facilitate discontinuous careers’—are difficult to recover. The research found a very high proportion of women working in areas for which they were substantially over- or inappropriately qualified, in jobs secured by virtue of their language competencies and yet for which they were underpaid. A significant number of this group include women whose partners make repeated moves, often working under contracts for multinational companies. In such cases, it becomes very difficult for women to maintain careers. For that group of women

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Migration and Free Movement in the European Union 127 moving to accompany partners, Ackers notes that the effects of migration are felt quite keenly in their post-migration employment experience, which has a significant impact on their financial autonomy and quality of life in the mid term. In the same study, it was found that the consequences of migration were generally less serious in the group of women whose migration was motivated by concerns for personal career advancement and financial independence. Consequences in the mid term, following the initial period of language acquisition and general dislocation, were often quite beneficial. Many women took full advantage of training and educational opportunities in the host state and utilised their skills to best effect in the domestic labour market. Although many women in this group experienced, as with the previous groups, problems in terms of recognition of qualifications etc, migration generally presented new opportunities. Career dislocation and downward mobility often accompanied changes in post-migration personal status, with marriage, family formation and the evolution of caring obligations. In many cases, these women subsequently experienced the kind of problems associated with the previous group, as partner-determined interregional or international migrations took place resulting in difficulties in finding a use for their skills in local labour markets.91 It is interesting to note that the findings of this research do not imply any differentiation in the effects of migration depending on whether the movement is to a ‘women-friendly’ or ‘women-hostile’ state. Ackers writes that one should be careful of making generalisations about the labour markets of the countries in predicting the impact of migration. For example, in cases where women have highly developed professional careers, a move from strong-male breadwinner countries considered ‘women-hostile’ to weak-male breadwinner countries, typically considered ‘women-friendly’, may actually prove detrimental in terms of salary, status and securing employment.92 The impact of migration depends not only on the employment situation of the host country but also on the extent to which skills are recognised.93 Thus, the study of intra-Community female migration reinforces the theory of negative effects, although it does not endorse the view that such migration is of a secondary nature. Another aspect of migration that remains largely unknown and unexplored, at least in the European Union context, is the effect of return migration on the 91 On a more positive note, however, Ackers concludes that research evidenced not only the devastation of many women’s professional lives but also significant periods of re-building. In many cases, migrant women were able to create new opportunities for themselves, either through exercising educational and training opportunities or through self-employment: ‘Migrant women are not simply the passive victims of labour market discrimination and gender-role stereotyping; they have proved themselves to be capable of utilising their skills in innovative ways, greatly enhancing their financial autonomy and quality of life.’ 92 This was confirmed even with reference to Sweden, which is typically considered ‘woman-friendly’ and almost as a yardstick against which other states are compared in terms of gender equality. The same negative effects were not, however, restricted to Sweden. They were also common with reference to other countries such as the United Kingdom and Portugal. 93 Migrant women often felt that it was a political problem, that progressive gender policies in Sweden did not extend to the migrant population; see L Ackers, above n 37, at 253, n 56.

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128 Female Migration and Implications for Social Security employment status of women.94 No research has focused specifically on women in this area. In many respects, however, the situation of migrant women returning home may be comparable, though not similar, to that of other foreign women.95 Academic or professional qualifications acquired in another country may not be recognised. Long-term absence may have caused a lack of professional connections and insufficient up-to-date information about the work conditions in the country of origin. A lack of social networks may make care duties heavier and possible family obligations in the country of emigration may further complicate the picture and inhibit labour activity. The impact of migration does not cease immediately upon return to the country of origin.96 The disadvantaged position of women in the labour market has attracted political interest at the European Union and national levels in recent years. Several measures have been planned and adopted with the aim of combating female unemployment and the generally unfavourable position of women within the framework of policies promoting employment, as well as within the framework of equal opportunity policies. Particular attention has been focused on the lack of state care services, especially for children, and on other measures facilitating the reconciliation of work and family life. No special attention, though, has been directed within the framework of these policies and measures towards migrant women in general, or intra-Community female migrants in particular. On the contrary, the overall impression emerging from Community policy is that of a declining Community interest in issues concerning female migrants.97 This decline becomes 94

For a general discussion of return migration see C Dustmann, ‘Return Migration: The European Experience’ (1996) 22 Economic Policy 213. 95 See the fears and scepticism about returning home expressed by interviewees in L Ackers, above n 37. 96 The return of migrant workers is generally reported to be accompanied by economic, social and psychological problems, preventing them from finding jobs, especially in adequate positions, and preventing them from improving their social situation according to their aspirations; see H Körner, ‘Problems of Migrant Workers’ Return to their Home Countries’ (1984) 20 Intereconomics 235. See also E Lundberg Lithman, above n 70, at 73. 97 See eg European Commission, Annual Report from the Commission—Equal Opportunities for Women and Men in the European Union—1998 (COM (99) 106 final); Recommendation for a Council Recommendation on the implementation of Member States’ employment policies (COM (00) 549 final); Joint employment report 2000—Part I: the European Union—Part II: the Member States (COM (00) 551 Vol I final and COM (00) 551 Vol II final); Amended proposal for a Council Decision on Guidelines for Member States’ employment policies for the year 2001 (COM (00) 735 final). See also Council Resolution of 22 February 1999 on the 1999 Employment Guidelines (OJ 1999 C 69/2); Council Decision 2000/228/EC of 13 March 2000 on guidelines for Member States’ employment policies for the year 2000 (OJ 2000 L72/15). All of these documents, adopted after the Union’s decision in 1997 to fight unemployment with the development of policies based on four pillars, give no evidence of any particular Community concern for migrant women. The same appears to apply for Community measures in the field of equal opportunities, as well as in the non-discrimination area. See eg Council Decision 95/593/EC of 22 December 1995 on a medium-term Community action programme on equal opportunities for men and women (1996 to 2000) (OJ 1995 L335/37); Special Report No 22/98 concerning the management by the Commission of the implementation of measures to promote equal opportunities for women and men accompanied by the replies of the Commission (OJ 1998 C393/24); Council Directive 2000/78/EC of 27 November 2000 establishing a general framework for equal treatment in employment and occupation (OJ 2000 L303/16); Council Decision 2000/750/EC of 27 November 2000 establishing a Community action programme to combat discrimination (2001 to 2006) (OJ 2000 L303/23); Communication from the

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Migration and Free Movement in the European Union 129 more obvious when compared with the Community’s measures to enhance the employability of other problematic groups, such as young people, older workers and people with disabilities.98 The factors inhibiting migrant women’s labour market activity are examined in more detail in the following sub-section. 1.2 Factors Inhibiting Migrant Women’s Labour Market Activity A common problem faced by women trying to find or secure employment in a Member State other than their own concerns the recognition of academic degrees and professional qualifications by employers and authorities. Despite the European Community’s policy of mutual recognition of degrees and diplomas, research findings give evidence of little, if any, success in this area. On the contrary, as shown in Ackers’ research, the European experience challenges even the view that some professions, such as teaching and nursing, ‘facilitate discontinuous careers’. The European experience, according to her, does not underpin the view that there are certain careers/professions that facilitate discontinuity. Teachers and nurses suffer adverse effects of migration just like other professionals. In all cases, the experience of internal female migrants illustrates the considerable difficulties experienced when finding or securing work in all Member States of the Community. A lack of advanced linguistic skills may be another major problem.99 Internal migrants within the European Union, in contrast with internal migrants in the United States or Australia for example, where many migration studies are Commission to the Council, the European Parliament, the Economic and Social Committee and the Committee of the Regions on certain Community measures to combat discrimination (COM (99) 564 final); Proposal for a Council Decision establishing a Community Action Programme to combat discrimination (2001 to 2006) (COM (99) 567 final); Report from the Commission to the Council, the European Parliament, the Economic and Social Committee and the Committee of the Regions—Equal opportunities for women and men in the European Union—1999 (COM (00) 123 final); Amended Proposal for a Council Decision on the programme relating to the Community framework strategy on gender equality (2001–2005) (COM (00) 793 final). 98 Council Resolution of 17 June 1999 on equal employment opportunities for people with disabilities (OJ 1999 C 186/3); Communication from the Commission to the Council, the European Parliament, the Economic and Social Committee and the Committee of the Regions—Towards a barrier free Europe for people with disabilities (COM (00) 284 final). 99 Of particular interest in this context is the Court’s ruling in the Groener case (Case C-379/87 Groener [1989] ECR 3967). The question was whether a Dutch national should be appointed to a permanent full-time post as an art teacher in Ireland. Mrs Groener had failed a test intended to assess her knowledge of the Irish language. The teaching of art, like that of most other subjects taught in public vocational education schools, was conducted essentially, or indeed exclusively, in the English language and therefore knowledge of the Irish language was not required for the performance of the teaching duties. The European Court of Justice, however, ruled that the requirement imposed on teachers to have adequate linguistic skills was not in conflict with the Community provisions on free movement (Art 3(1) of Reg 1612/68 in particular), provided that the linguistic requirement in question was imposed as part of a policy for the promotion of the national language: ‘The importance of education for the implementation of such a policy must be recognized. Teachers have an essential role to play, not only through the teaching which they provide but also by their participation in the daily life of the school and the privileged relationship which they have with their pupils. In those circumstances, it is not unreasonable to require them to have some knowledge of the first national language.’

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130 Female Migration and Implications for Social Security conducted,100 have to cope with an additional difficulty, namely the linguistic plurality of the Union. Furthermore, family duties may place a very heavy burden on migrant women’s shoulders, eventually precluding their labour market participation altogether. Without being able to count on the support of an extended family or of a network of friends or neighbours,101 or even on the help of their husband, they may find it almost impossible to work. Sometimes, migrant women are even unaware of the welfare care facilities available in the host Member State. As migrant women are less likely to be able to depend on unpaid informal or family care for their children, they may rely more heavily upon statutory provisions. In Member States without a welldeveloped state care provision system, migrant women might even be more or less doomed to domestic lives, unless they can rely on the private sector. In fact, in some countries of the European Union, almost 70 per cent of EU migrants with young children are not engaged in paid work.102 However, it should be noted that even where both facilities and awareness exist, migrant women may still be hindered in using them. A potential hindrance may be a wish to have children raised in the host country without losing their linguistic and cultural heritage, which may lead parents to decide to take care of their children themselves. A frequent solution in this case appears to be shift work for both parents.103 Marriage and family formation affect all women’s labour market activity, irrespective of migration status. The consequences for migrant women, however, are particularly great given the limited awareness of welfare provision together with the lack of informal support and the complicated web of caring obligations that exists in more than one country.104 Caring obligations across different countries do not necessarily involve care of children; on the contrary, they very often refer to the care of aged parents. Ackers brings to light a type of family responsibility very often neglected in both policy and literature. Policies at both national and Community levels have focused almost exclusively on the labour market integration of young mothers and parenting responsibilities, thus covering a limited span of women’s lives. At the same time, the policies have failed to address the issue of other forms of care relationships. Scant 100 As Ackers points out, migration research is primarily either concerned with international movement between countries or with patterns and processes of internal migration within a country. This distinction between international and internal migration, however, is somewhat confusing when it comes to the movement of Union nationals in the European Union. On the one hand, it can be defined as a subset of international migration since it is concerned with movement between national states. On the other, it can be regarded as internal, to the extent that the Community constitutes a distinctive geopolitical entity. See L Ackers, above n 37, at 141. 101 For a broader discussion of the question whether residential mobility disrupts network ties in the American context, see L Magdol,‘The People You Know: The Impact of Residential Mobility on Mothers’ Social Network Ties’ (2000) 17 Journal of Social and Personal Relationships 183. 102 L Ackers, ‘Citizenship, Gender and Dependency in the European Union: Women and Internal Migration’ in T Hervey and D O’ Keefe (eds), Sex Equality Law in the European Union (Chichester, Wiley, 1996). 103 E Lundberg Lithman, above n 70, at 35. 104 L Ackers, above n 37, at 308–9.

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Migration and Free Movement in the European Union 131 attention has been paid to women in their ‘middle years’ as ‘labour force participants who require assistance with their caring responsibilities’. Demographic changes and welfare retrenchment, though, have raised a debate regarding the state’s ability to support an ageing population. Within this context, increasing attention has been paid to the role of this category of care providers. Migrant women in particular may have care responsibilities spread over two countries: in the country of origin and in that of residence. At the same time, their access to the welfare arrangements of both states may be hindered by a number of factors, including a lack of information. In general, the dismantling of the welfare state and the return to ‘individual responsibility’ is estimated to have serious repercussions on migrant women, in particular, as sole carers in the host Member State, and as daughters and sisters of dependants in the country of emigration.105 Another issue is the impact of women’s personal attitudes—often interwoven with ‘quality of life’ personal attitudes—on their labour activity rate. International research shows that migrant women, when they move for family-related reasons, often perceive themselves primarily as mothers and wives at the time of the move. Many married women will willingly sacrifice their careers provided that migration improves the economic well-being of the entire family. This appears to apply irrespective of women’s professional or academic qualifications.106 This lack of grief for lost career opportunities was considered by some researchers as evidence for the non-detrimental effects of migration.107 European women are no exception. In many empirical cases, they have presented evidence of according priority to their role as mothers, if not also as partners. As Ackers notes, some women do not share the feeling of ‘sacrifice’. For them, giving up work in order to care for children is considered to be the right option to take, at least when children are in their early years.108 However, it does not emerge clearly whether women who give priority to mothering do take an active decision not to seek work in the host country, and whether they will even turn down offers of work, or whether they simply accept the negative effects of migration without regrets. Personal attitudes with regard to the negotiation of the public/private spheres may be influenced by and interwoven with cultural values. Cultural values, in particular the value attached to motherhood in the country of origin, may eventually inhibit labour market participation in the country of residence.109 105

Ibid, ch 8. D Lichter, above n 61. N Bonney and I Love, above n 61. 108 L Ackers, above n 37, at 214. The research also showed that migrant women living in Ireland were more preoccupied with their reproductive and marital rights, in particular with regard to the prohibition of divorce and abortion, than they were with employment and financial autonomy. Women living in Sweden also expressed scepticism, often outright criticism, regarding the importance attached by the system to paid work, which they often perceived as a cultural pressure to work and as constraint rather than opportunity. As to the experience of women living in different systems, see L Ackers, above n 37, ch 7. 109 Different labour market rates for women of different national origins have been noted, but there exists no evidence of a direct link between these two factors. Other parameters, such as the purpose of migration, the economic situation of the family and care facilities, may play a more important role. As differences are reported in findings between host countries, the labour market climate in these countries may also be of relevance; see E Lundberg Lithman, above n 70, at 23–27. See also MDR Evans,‘Immigrant 106 107

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132 Female Migration and Implications for Social Security Considerable differences exist among Member States with regard to the cultural values attached to motherhood. Movement from a Member State where a high value is attached to motherhood to a Member State where motherhood is attributed a low value may cause a failure to understand the new cultural context and to participate fully in the labour market.110 The risk of misunderstanding brings us to the question of adequate information and awareness of the conditions of the new country of residence on the part of migrant women. Research shows that migration is not usually accompanied by high levels of awareness of, or interest in, the circumstances in the new country, whether it concerns social policy or gender relations.111 This is perhaps because migration generally occurs when women are young, often single and less concerned with matters of family policy or similar issues. Ackers counts limited awareness of the welfare provisions in the host Member State as one of the factors making the care burden heavier for migrant women, with the final result of inhibiting their labour market activity.112 It appears that even if migrant women were actually interested, there is little accessible information available that could assist them in evaluating the systems.113 Another factor that may possibly jeopardise migrant women’s activity in the labour market is their generally poorer physical and psychical health compared to the local population. The relation between a migrant woman’s health and work has not attracted much interest in academic research. The documented lower levels of physical and psychological well-being114 are however likely to have an impact on their labour activity.

2. The Impact of Migration on Women’s Marital Status Knowledge about the impact of migration on the marital status of women is much more limited. The issue has not been subject to the same extensive research as the interaction between migration and employment. There is however some statistical Women in Australia: Resources, Family and Work’ (1984) 18 International Migration Review 1063; M Hechter, ‘Group Formation and the Cultural Division of Labour’ (1978) 84 American Journal of Sociology 293. 110 Finally understanding and having to live with the values of two or more different systems may lead to enormous psychological tensions. The norms embedded within those systems may create enormous pressures and tensions for the women concerned in terms of their own sense of obligation and roles and the expectations of those around them, both within the wider family and in the state. See L Ackers, above n 37, at 45. 111 L Ackers, above n 37, at 224. 112 The mainstream equality policies of the European Community ought to have a decisive impact in this respect, in the sense that they induce the convergence of the national systems and the establishment of a common model for all Member States, based on the dual breadwinner family. The establishment of a common model would certainly eliminate the risk of cultural misunderstandings over expected or accepted roles for women in various Member States. 113 L Ackers, above n 37, at 224. 114 E Lundberg Lithman, above n 70, at 51–53.

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Migration and Free Movement in the European Union 133 data at the national level that indicates negative effects of migration on marriage stability, as well as some research findings that point to the same conclusion.115 Statistical data in Sweden shows that marriage and partnership dissolution rates between foreigners resident in Sweden—despite differences among ethnic groups—is higher than the dissolution rate between native Swedes. The marriage dissolution rate is higher for couples coming from countries outside Europe as compared to couples from other European countries.116 Mixed couples, either those coming from different countries and living in Sweden or those where one partner is migrant and the other is a native Swede, appear to run a particularly high risk.117 Whether the high divorce rates can be explained by the poor socioeconomic situation of many migrants, cultural differences or other reasons, is a currently debated issue.118 The wife’s work appears to be a significant factor. Researchers have found that the impact of migration was experienced very differently by working and non-working women. Work appeared to have ‘particularly strong repercussions in aligning marital relationships’.119 On the other hand, whether a migration decision can induce a marriage decision, that is to say whether migration or the prospect of migration possibly increases the marriage rate, is unknown. There are some indications, however, that this might be the case. Before moving to Ireland, for example, some women felt compelled to marry in order to avoid stigma for themselves and their children and in order to facilitate their integration in Ireland.120 A reverse impact was also noted, that is to say a decision not to marry because of the absence of divorce possibilities in Ireland.121 Even the choice of the location of the wedding was often influenced by the prospect of moving. Awareness of the divorce situation in Ireland had an important bearing on many women’s decision about where to marry. In many cases, women returned to marry in their country of origin to safeguard their right to divorce.122 Movement to other countries may influence marriage decisions in the same way. The current state of the research, however, does not permit the drawing of any in-depth conclusions. 115 The reverse impact, that is to say whether a divorce may facilitate or cause a migration decision or, at least, the fact that divorcees are relatively more mobile, is better documented; see L Hayes and A AlHamad,‘Residential Change: Differences in the Movements and Living Arrangements of Divorced Men and Women’ in P Boyle and K Halfacree, above n 39, at 261–79; R Flowerdew et al, ‘The Residential Mobility of Divorced People’ in S McRae (ed), Changing Britain: Families and Households in the 1990s (Oxford, Oxford University Press, 1999), pp 427–40; SCB, above n 68; E Grundy ‘Divorce, Widowhood, Remarriage and Geographic Mobility among Women’ (1985) 17 Journal of Biosocial Science 415. 116 SCB, Barnfamiljer 1997. Demografiska rapporter 1999:1 The results, though, could be modified when other variables, such as length of the marriage, number of children etc, were taken into account. See M Darvishpour, ‘Invandrarkvinnor utmanar männens roll’ in Familj, makt och jämställdhet, SOU 1997:138, at 263–7. 117 SCB, Barnfamiljer 1997, above n 116. 118 M Darvishpour,‘Intensified Gender Conflicts within Iranian Families in Sweden’ (1999) 7 Nordic Journal of Women’s Studies 20; E Lundberg Lithman, above n 70, at 39. 119 S Pedraza, above n 40. 120 L Ackers, above n 37, at 260. 121 Ibid. 122 Ibid, at 261.

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134 Female Migration and Implications for Social Security Nevertheless, it appears that marriage may acquire a different or several dimensions in the migration context. For some women, marriage can be the means of gaining independence and participating in a different type of society without ruling out the desire to work or study.123 For others, marriage appears to be the appropriate route when confronted with the dilemma of employment or marriage, or when called to choose between individual advancement and the best interests of the family as a whole. Whatever the case, the indications point towards an increase in the importance of marriage in the migration context. Unluckily, to date ‘the different dimensions of marriage are . . . a . . . much neglected topic in the study of international migration’.124

CONCLUDING REMARKS

The discussion in this chapter began by revealing that the system of co-ordination established by Reg 1408/71 was not only based on the prevailing, at the time of its adoption, strong-male breadwinner model of welfare state and social security, but also on the prevailing migration theories viewing migration as a predominantly economic phenomenon of a male nature. Female migration was generally considered as secondary, induced by family motives. More recent migration research, however, has challenged these prevailing theories and brought to light new patterns of female migration, in particular the pattern of independent female migration induced by a variety of motives, among them professional career or family motives. The latter in any case seems to have a significant role in most cases of female migration. The main focus of this chapter—addressing the question of whether the situations chosen for examination in this book are of relevance and importance for the co-ordination system—has shown that this is undoubtedly the case. Migrant women not only interrupt work for child-rearing, but, for various reasons, they are prone to do so to a greater extent than native women. Since such interruptions may affect their right to social security entitlements in the Member State of residence, the application of co-ordination principles may be extremely important inasmuch as it may permit the acquisition of rights under the system of that state or the retention of rights acquired under the system of the Member State of origin. Furthermore, in most cases of migration of economically active women—at least qualified ones125—whether induced by family reasons from the beginning or converted to family motivations later on, migration seems at some point to have a negative impact on employment stability and labour conditions. Although the former group is more vulnerable to such an impact, most female migrant workers 123

E Kofman, above n 18, at 287. Ibid. 125 As to the mobility prospects of qualified women, the problems of dual career families and the strategies that international companies should form in the face of these problems, see C Hecq and O Plasman, above n 49, ch 2 of the second part. 124

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Concluding Remarks 135 seem to suffer negative effects in terms of employment as a consequence of the demands of personal/family life in a migration context. In this regard, the theory of negative effects has been rather modified than rejected by recent findings, as the occurrence of some negative effects, in terms of employment, salary or status, at some point after a migration, in fact is not questioned.126 Migration thus seems to be a specific risk situation for economically active women—or people making traditionally female choices—and is very likely to give rise to work interruptions. Consequently, female migrant workers run the risk of work interruptions both because of child-rearing duties and because of the migration itself. The viability of employment as a basis for social security rights is jeopardised not only by reproductive functions and caring duties but also by the very fact of movement from one country to another. Finally, there are indications that migration may affect a person’s marital status, although this issue is very much underdeveloped. A decision to marry may follow a decision about migration. In general, migrant women may shift from an employment-centred life to a family-centred one to a greater extent than native women, although whether this shift is the result of the exercise of a real option or simply a necessary evil, accepted without regrets, has not been shown. Whatever the case, it obviously results in strengthening the importance of personal or marital status as a ground for social security protection. At the same time, higher divorce rates may also be a consequence of migration. Against this background, the extent to which a person’s personal or marital status is recognised by a co-ordination system—the European Community co-ordination system—is obviously of great importance for acquiring or retaining rights under a national system. Obviously, all three situations on which the book focuses, namely work interruptions due to child-rearing, work interruptions because of migration and lack of married status, emerging not only from changed labour and family conditions but also from changed migration patterns, challenge the co-ordination system of the European Community and raise issues for the adaptation of Reg 1408/71 (as well as Reg 883/04) to the new conditions. It is now appropriate in the following chapters to examine the extent to which the system perhaps has been adjusted and the protections, in terms of co-ordination rights, available to people finding themselves in one (or even several) of these three situations, as well as the gaps remaining.

126 A profound challenge to the theory of the negative effects of interest here came from those researchers arguing that negative effects in the labour market are not a result of migration per se. Instead, they arise from the fact that most women are in the childrearing stage of their life cycle and, thus, migrant women, in common with many other nationals, suffer a negative impact with respect to reproductive duties (above, at II, 1). This author, however, accepts the theory of negative effects and examines these two cases of work interruption separately, although sometimes it may be difficult in practice to distinguish them.

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4 Work Interruptions and the Personal Scope of the Co-ordination Regulations INTRODUCTION

In the previous chapter an effort was made to present an accurate depiction of migrant women. It was shown that the lives of migrant women in real terms are often dominated by work interruptions, which occur to a much larger extent than for local women. Apart from an increased risk and frequency of work interruptions for child rearing, the working lives of migrant women are most usually interrupted because of the very fact of migration. The personal status of women also appears to be affected by migration, although reliable sources with regard to this issue are lacking. This is mostly true in terms of divorce, which arguably increases in a migration context. Interruptions to work obviously lead to a reduction in income while the breakdown of marriage brings to an end the economic security acquired through it. As a consequence these two scenarios ought to be of relevance to social security systems as the whole rationale of the institution of social security is to safeguard economic security. Social security emerged out of the need to safeguard an income or generally a means of subsistence in cases of failing income, as was shown in chapters one and two. Against this background, the question that naturally follows is how the economic security of migrant women is safeguarded through social security in cases of failing income or other means of support. In other words, the question is how situations of work interruption or absence and breakdown of marriage are regulated legally within the framework of the co-ordination system, for the protection of migrant women. The legal regulation of work interruptions and changing family patterns within the framework of the co-ordination system is the topic of this and the following chapters. The present chapter focuses on work interruptions due to child-rearing or migration; in other words it concerns women in their capacity as workers. The particular question raised in this chapter is whether the personal scope provisions of Reg 1408/711 and Reg 883/04 cover such persons whose economic activity/ employment2 has been interrupted because of child-rearing or migration. Whether 1

As last consolidated and updated by Reg 118/97 ([1997) OJ L28/1). The term ‘employment’ is used throughout the book as synonymous with economic activity, work, professional activity, professional occupation and occupational activity. It is not used in the strict labour 2

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138 Work Interruptions and the Personal Scope of the Co-ordination Regulations the same categories of people are covered by the choice of law provisions of the Regulation is also examined. The personal scope of Reg 1408/71 is defined in Art 2(1) in conjunction with Art 1(a) in Title I of the Regulation, which contains the general provisions. The personal scope of Reg 883/04 is defined in Art 2, which is also in Title I of this Regulation. Since both regulations are in force for the time being, the relevant provisions in both of them will be examined. Furthermore, the choice of law provisions, which constitute Title II in both regulations, must be examined. The personal scope provisions of Title I and the choice of law provisions of Title II will be examined together, due to their inextricable connection in the application of the regulations. Regulation 883/04 has simplified the rules with regard to the persons covered and the choice of law, and has incorporated significant case law developed under Reg 1408/71. Thus, while an extended analysis of the case law is necessary in order to lay down the state of law with regard to these two issues and to answer pertinent questions on the basis of Reg 1408/71, it is much simpler to answer them on the basis of Reg 883/04. It must not be forgotten, though, that Reg 883/04 is new and no case law has yet developed concerning its interpretation. Whether it is going to function better than its predecessor and produce less case law remains to be seen. In the meantime, the case law developed under Reg 1408/71 can still be useful for gaining a better understanding of the problems connected with the issues of determining the personal scope and the applicable legislation, as well as a better understanding of the new Reg 883/04 and the problems that might arise under it. In the following pages, the state of the law concerning the personal scope of the co-ordination system and the choice of law system is examined with reference, first, to Reg 1408/71 and, subsequently, to Reg 883/04. While examining Reg 1408/71 focus is placed on the case law, which played a decisive role in the development of the system. As already stated, there is no case law as yet with respect to Reg 883/04, and the examination is therefore confined to the legal provisions. This parallel examination of the two regulations will hopefully produce a complete picture of the current state of law and cast light on the relationship between the two regulations with regard to the issue of the application of the co-ordination system to migrant (female) workers interrupting work. It should, however, be borne in mind that it is Reg 1408/71 that applies for the moment. The personal scope of the co-ordination system is discussed in section I. The examination here focuses, first, on the meaning of the term ‘employed or selfemployed person’as included in Art 2(1) of Reg 1408/71. Particular attention is paid to the question of whether Reg 1408/71 covers economically non-active persons in general. Then, the personal scope of Reg 883/04 is discussed. At the end of this section, we ask whether it can be concluded on the basis of the analysis that people interrupting work due to child-rearing and migration in particular are covered by Reg 1408/71 and Reg 883/04. law meaning implying a contract of employment. The same applies with regard to the terms ‘employed person’ and ‘worker’, used to denote an economically active person or worker. The ‘employed person’ is sometimes referred to as the ‘Community worker’.

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The Persons Covered by the Co-ordination System 139 The choice of law provisions are discussed in section II. The aim in this section is to see whether these provisions cover people interrupting work because of childrearing and migration. First, the substantive content of the fundamental principles of the choice of law provisions, ie the principles of single applicable legislation and lex loci laboris, are examined with reference to Reg 1408/71. The discussion then focuses on the people covered by the provisions and these embedded two principles. Particular attention is paid even here to the issue of whether these fundamental principles apply to economically non-active people in general. It will be seen that a third principle—the lex loci domicilii principle—arises in this context. Subsequently, the choice of law provisions of Reg 883/04 are examined. The structure and the aim of the discussion are the same. At the end of the section, the particular focus is on people who interrupt employment due to child-rearing responsibilities and migration. The question is asked whether it can be concluded that they are covered by the choice of law provisions of Title II of the two regulations and the principles established therein.

I. THE PERSONS COVERED BY THE CO-ORDINATION SYSTEM ON THE BASIS OF THE CRITERION OF SOCIAL SECURITY

The co-ordination system covers two main categories of people, namely those covered by a national social security scheme and members of their family. The analysis in this chapter concerns the former category, while the application of the personal scope provisions to members of the family is discussed in chapter six.

1. The Personal Scope of Reg 1408/71 The personal scope provisions of Reg 1408/71, included in Title I, do not explicitly refer to persons whose economic activity has been interrupted because of childrearing or migration. Art 2(1) of Reg 1408/71 refers to ‘employed or self-employed’ persons. Therefore, the question whether people whose work has been interrupted due to child-rearing or migration are covered by the personal scope provisions cannot be answered directly. The answer must be sought in the interpretation of the term ‘employed or self-employed’ in Art 2(1). The case law is important in this context, and the law-making role of the Court of Justice becomes obvious. The personal scope of Reg 1408/71 is laid down in Art 2. Sub-section (1) states: This Regulation shall apply to employed or self-employed persons who are or have been subject to the legislation of one or more Member States and who are nationals of one of the Member States or who are stateless persons or refugees residing within the territory of one of the Member States, as well as to the members of their families and their survivors.

Regulation 1408/71 consequently applies to employed or self-employed persons who are or have been subject to the legislation of one or more Member States. This

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140 Work Interruptions and the Personal Scope of the Co-ordination Regulations is the first major category of persons covered by Reg 1408/71. The concept ‘employed or self-employed persons’ is defined in Art 1(a) of Reg 1408/71 and is discussed below, in sub-section 1.1. It is not apparent from the wording of Art 2(1) that a person must be migrant. On the contrary, it appears that Reg 1408/71 can also apply to non-migrants, since it is sufficient that a person is or has been subject to the legislation of one Member State. The migration element—or, better, the movement or intra-state element—emerges from the title of Reg 1408/71, where it is clearly stated that the Regulation applies to persons who move within the Community. The Court of Justice has also stated that the Regulation does not apply to purely internal situations. In addition, the person concerned has to possess nationality of one of the Member States, or be stateless or a refugee residing within the territory of one of the Member States. Some years ago, however, a new Regulation was introduced permitting the application of the coordination system to third country nationals legally residing in one Member State.3 Thus, a person can be covered by Reg 1408/71 if s/he can be regarded as an ‘employed or self-employed’ person within the meaning of the Regulation and if s/he satisfies the criteria of movement and nationality. 1.1 The Concept ‘Employed or Self-employed’ Person The first social security regulation, Reg 3/58, applied to ‘wage earner or assimilated workers’. After extensive interpretation of this term by the Court of Justice, beyond the concept of worker stricto sensu,4 the term ‘employed’ was preferred in order to determine the personal scope of Reg 1408/71. This notion was then extended, and, currently Reg 1408/71 applies to ‘employed or self-employed’ persons. The Court of Justice has continuously taken conscious steps to differentiate between the concept of employed and a contract of employment, giving it a broader meaning. The Court has consistently emphasised that the crucial element for the determination of the extent of the term ‘employed’ is not a contract of employment in the narrow meaning of labour law,5 but an affiliation to a national social security system. As Advocate General Darmon put it: [I]t is by being covered by the social security systems of a Member State and not because of how the occupation in question is classified under national law that a Community citizen becomes ‘‘moored’’ to Reg 1408/71.6

The emphasis placed from the beginning on the criterion of social security rather than the criterion of paid employment in labour law has had two consequences. First, the nature of the economic activity, ie whether it is paid employment or any 3

Below, at 1.3 and 2.4. See eg Case 19/68 de Cicco [1968]] ECR 473, concerning a ‘craftsman’; Case 23/71 Janssen [1971]] ECR 859, concerning a ‘helper’. 5 How the term ‘employed’ is defined in labour law is a vast area that cannot be dealt with here as it goes beyond the limits of this book. 6 Case 300/84 Van Roosmalen [1986]] ECR 3097, Opinion of Advocate General Darmon delivered on 23 April 1986, at 3110. 4

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The Persons Covered by the Co-ordination System 141 other professional activity, has lost its relevance. As a consequence, the Regulation was gradually extended to cover other categories of economically active persons as well, such as self-employed persons and civil servants. Second, the importance actively pursuing an economic activity at the time a social security risk materialised was minimised. The grounds for both of those developments were laid down in Unger, the first social security case. The Unger Case7 The Unger case involved a Dutch national living in Amsterdam who, whilst employed, was compulsorily insured under the Dutch Health Insurance Act. Her compulsory insurance ceased when she left her employment to have a child, but she continued to pay contributions to the scheme on a voluntary basis. A month after leaving her employment, she visited her parents in Germany. During her visit there, she fell ill and her condition required immediate medical treatment. Upon returning to Holland she claimed reimbursement for the medical expenses she had incurred in Germany. Her claim was rejected on the ground that she had not obtained the necessary authorisation by the competent social security institution. Under Dutch national law, the right to reimbursement for medical expenses during temporary residence abroad was available only when the claimant had been authorised by the competent social security institution to go abroad for the purpose of convalescence, and Ms Unger lacked such authorisation. She appealed against the decision, arguing that she was entitled to reimbursement on the basis of Community law, in particular by virtue of Art 19(1) of Reg 3/58.8 The question raised was whether she was covered by the Community law of co-ordination. The specific issue was whether she could be regarded as a ‘wage earner or assimilated worker’ within the meaning of Reg 3/58, which was in force at the time. The concrete question submitted to the Court of Justice was whether the concept of wage earner or assimilated worker had a supranational meaning or whether it was to be defined by the legislation of the Member States. The Court held that the concept ‘wage earners or assimilated persons’ employed in Reg 3/58, like the term ‘workers’ in Articles 48 to 51 of the Treaty, had a Community meaning. The Court justified its decision as follows: [A]rticles 48 to 51 of the Treaty, by the very fact of establishing freedom of movement for ‘‘workers’’, have given Community scope to this term . . . Articles 48 to 51 would therefore be deprived of all effect and the objectives of the Treaty would be frustrated if the meaning of such term could be unilaterally fixed and modified by national law. The concept of ‘‘workers’’ in the said Articles does not therefore relate to national law, but to Community law . . . The concept of ‘‘wage-earner or assimilated worker’’ has thus a Community meaning, referring to all those who, as such and under whatever description, are covered by the different national systems of social security.9

In addition to making it clear that the nature of the economic activity and its classification according to national laws was not decisive, the Court also underlined 7 8 9

Case 75/63 [1964] ECR 117. Below, ch 5 at II, 1.1 a i. Case 75/63 Unger [1964] ECR 117, paras 6–15.

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142 Work Interruptions and the Personal Scope of the Co-ordination Regulations that the person concerned does not need to be in active employment when the risk materialises: [I]t follows both from the Treaty and from Regulation No 3 that the protected ‘‘worker’’ is not exclusively one who is currently employed . . . The Treaty and Regulation No 3 thus did not intend to restrict protection only to the worker in employment but tend logically to protect also the worker who, having left his job, is capable of taking another. (emphasis added)

It is rather interesting to note that the very first social security case referred to a person interrupting work because of childbirth/child-rearing. The question whether such a person is covered by the co-ordination system and the relevant Regulations was thus raised at a very early stage of development of Community law. The Court’s answer, as shown above, did not leave much room for doubt. A person in such a situation was covered by Reg 3/58, and consequently by Reg 1408/71, provided s/he was covered by a national system of social security. The issue then becomes: If affiliation to a national social security system is the necessary condition for the application of Reg 1408/71, what sort of affiliation is demanded? The answer to this question is provided by Art 1(a) of Reg 1408/71. This article defines, on the basis of the criterion of social security, the term ‘employed or selfemployed’ included in Art 2(1) of the Regulation:10 For the purpose of this Regulation: (a) ‘employed person’ and ‘self-employed person’ mean respectively: (i) any person who is insured, compulsorily or on an optional continued basis, for one or more of the contingencies covered by the branches of a social security scheme for employed or self employed persons; (ii) any person who is compulsorily insured for one or more of the contingencies covered by the branches of social security dealt with in this Regulation, under a social security scheme for all residents or for the whole working population if such person: — can be identified as an employed person by virtue of the manner in which such scheme is administered or financed, or, — failing such criteria, is insured for some other contingency specified in Annex I under a scheme for employed or self-employed persons, or under a scheme referred to in (iii), either compulsorily or on an optional continued basis or where no such scheme exists in the Member State concerned complies with the definition given in Annex I; 10 The article reflects the developments of Community law under Reg 3/58; see R Cornelissen, ‘25 Years of Regulation. (EEC) No 1408/71. Its Achievements and its Limits’ in Swedish National Social Insurance Board and European Commission (eds), 25 Years of Regulation (EEC) No 1408/71 on Social Security for Migrant Workers—A Conference Report (Stockholm, 1999), at 28–29 and 42. See also D O’Keefe, ‘The Scope and Content of Social Security Regulation in European Community Law’ in D O’Keefe and H Schermers (eds), Essays in European Law and Integration (The Netherlands, KluwerDeventer, 1982), at 105 et seq; JC Séché, ‘The Revision of Regulations Nos 3 and 4 (Social Security of Migrant Workers) in the Light of their Interpretation by the Court of Justice’ in (1968–69) 6 CML Rev 170; JJ Ribas, ‘La révision des règlements nos 3 et 4 du Conseil des Communautés Européennes concernant le sècurité sociale des travailleurs migrants’ (1971) Droit Social 29.

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The Persons Covered by the Co-ordination System 143 (iii) any person who is compulsorily insured for several of the contingencies covered by the branches dealt with in this Regulation, under a standard social security scheme for the whole rural population in accordance with the criteria laid down in Annex I; (iv) any person who is voluntarily insured for one or more of the contingencies covered by the branches dealt with in this Regulation, under a social security scheme of a Member State for employed or self-employed persons or for all residents or for certain categories of residents: — if such person carries out an activity as an employed or self-employed person, or, — if such person has previously been compulsorily insured for the same contingency under a scheme for employed or self-employed persons of the same Member State.

The provisions established social security as the criterion upon which the term ‘employed or self-employed’ must be based. The ‘mooring’ of this term in social security rather than in labour law has generally been accepted with satisfaction and approval, and is considered the ‘only sensible criterion’.11 Some writers emphasise the importance of avoiding complications caused by different classifications of the same work in different systems. Others hold the view that a definition in social security terms was necessitated by the need to ensure that people remain protected when a social risk arises. It would arguably defeat the underlying purpose of Art 42 if the arrangements made under the Article ceased to apply when a person who was a worker then ceased to be a worker.12 The criterion of belonging to a social security system as the necessary element for defining the Community term ‘employed or self-employed’ will be analysed in the following pages, determining the personal scope of Reg 1408/71. Before moving on to an analysis of the issue of whether the active pursuit of an economic activity is necessary for the determination of the personal scope of Reg 1408/71 in accordance with Articles 2(1) and 1(a), brief attention will be given to movement and nationality. The section concludes by focusing in particular on people interrupting work because of child-rearing and migration and to the issue of their inclusion in the personal scope of Reg 1408/71. a. The Criterion of Social Security Three parameters are necessary in order to analyse and understand the criterion of social security established in Art 1(a) of Reg 1408/71: First, to what social risks, ie branches of social security systems, does the social security have to be related? Second, what are the characteristics of the 11 P Watson, Social Security Law of the European Communities (London, Mansell Publishing, 1980), at 64. See also G Lyon-Caen and A Lyon-Caen, Droit social international et européen (Paris, Éditions Dalloz, 1993), at 231 et seq. 12 R White, EC Social Security Law (Essex, Longman, 1999), at 20. Raepenbusch considers that, to the extent that problems have occurred with regard to the application of Reg 1408/71, they relate not to the choice of the social security criterion, but to the choice of the criterion of the application of the legislation of the Member State of employment, the lex loci-laboris criterion. See S Van Raepenbusch, ‘Persons Covered by Regulation (EEC) No 1408/71 and European Citizenship: From Migrant Worker to European Citizen’ in Swedish National Social Insurance Board and the European Commission (eds), above n 10, at 81–86.

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144 Work Interruptions and the Personal Scope of the Co-ordination Regulations national social security schemes to which Art 1(a) refers? And finally, what kind of affiliation to the social security scheme at issue is demanded? The first two questions obviously concern the material scope of the national systems at issue, while the third concerns the personal scope of the systems. All of these issues concern vast areas of the Community law of co-ordination where difficult problems of interpretation have been raised, and there is an abundance of case law. Here, however, they are discussed only briefly to illuminate the criterion of social security. i. Branches of Social Security The question of which branch of social security a person has to be insured under in a national system in order to be covered by Reg 1408/71 is answered by Art 4(1) of the Regulation. This article sets out the substantive scope of Reg 1408/71. Accordingly, Reg 1408/71 is to apply to all legislation13 concerning the following branches of social security or benefits: (a) sickness and maternity benefits; (b) invalidity benefits, including those intended for the maintenance or improvement of earning capacity; (c) old age benefits; (d) survivor benefits; (e) benefits in respect of accidents at work and occupational diseases; (f) death grants; (g) unemployment benefits; and (h) family benefits.14 According to the Court, the list of risks contained in Art 4(1) is exhaustive; as a result, any branch of social security not mentioned in the list falls outside the field of social security covered by Reg 1408/71.15 The list includes the recognised social security risks that are based on ILO Convention No 102.16 The development of schemes to cover new situations and to protect new categories of people puts pressure on the co-ordination system and the list in Art 4(1), as these schemes have to be classified under one of the risks named in the article in order to be covered by Reg 1408/71. 13 The meaning of ‘legislation’ is clarified in Art 1(j) of the Regulation to include, with respect to each Member State, statutes, regulations and other provisions and all other implementing measures, present or future, relating to the branches and schemes of social security covered by Art 4(1) and (2) or those special non-contributory benefits covered by Article 4(2a). For an interpretation of this provision see Joined Cases 82/86 and 103/86 Laborero and Sabato [1987] ECR 3401. 14 With regard to the material scope of Reg 1408/71, see eg Cases 69/79 Jordens-Vosters [1980] ECR 75; 171/82 Valentini [1983] ECR 2157; C-228/88 Bronzino [1990] ECR I-531; C-356/89 Newton [1991] ECR I-3017; C-78/91 Hughes [1992] ECR I-4839; Joined Cases C-88/95, C-102/95 and C-103/95 Losada, Balado and Paredes [1997] ECR I-869; Joined Cases C-245/94 Hoever and Zachow [1996] ECR I-4895; C25/95 Otte [1996] ECR I-3745; C-20/96 Snares [1997] ECR I-6057; C-85/96 Martinez Sala [1998] ECR I2691; and C-85/99 Offermanns [2001] ECR I-2261. 15 Case 249/83 Hoeckx [1985] ECR 973. The case raised the question of whether a social benefit guaranteeing a minimum means of subsistence in a general manner was a social security benefit covered by Reg 1408/71. The Court held that such a benefit could not be classified under one of the branches of social security listed in Art 4(1) and therefore did not constitute a social security benefit in the specific meaning of the Regulation. See also Case 122/84 Scrivner [1985] ECR 1027, para 19; and Case C-25/95 Otte [1996] ECR I-3745, para 22. 16 Above, ch 1, at I, 1.1 a.

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The Persons Covered by the Co-ordination System 145 The objectives of the national social security schemes are of no relevance. So long as they relate to the named risks, Reg 1408/71 makes no distinction between the social security schemes according to whether they pursue objectives of demographic policy.17 A person consequently has to be insured under a national scheme against the risks enumerated in Art 4(1) in order to be covered by Reg 1408/71. It is sufficient to be insured against only one of the risks or branches named in Art 4(1). This emerges not only from the definitions in Art 1(a), which state that a person is regarded as employed or self-employed if s/he is insured for ‘one or more of the contingencies’ (emphasis added) covered by the Regulation; it was also confirmed by the Court of Justice. In the Van Poucke case,18 the Court held: [I]t is immaterial that a person . . . is subject to only one specific branch of social security; if the branch of social security in question is part of legislation to which the regulation applies within the meaning of Article 2(3), the person covered thereby is properly subject to that legislation, with the consequence that he falls within the scope ratione personae of the regulation.19

ii. Characteristics of the National Schemes The Member States have developed various schemes that enable them to cope with social security risks, as discussed in chapter one. For instance, the schemes can be employment-related or residencebased, intended to cover certain employment categories or the entire population, or contributory or non-contributory. The states’freedom to decide on their own social security schemes is not affected by Reg 1408/71. They remain free to determine the provisions of their own national legislation and set out, for instance, the conditions with regard to affiliation to a social security system and entitlement to benefits,20 to alter them or to make them stricter.21 Thus, despite the Court’s reasoning in favour 17

Case 237/78 Palermo [1979] ECR 2645. C-71/93 Van Poucke [1994] ECR I-1101. See para 11 of the judgment. See also Cases 23/71 Janssen [1971] ECR 859; C-85/96 Martinez Sala [1998] ECR I-2691, para 36. 20 Cases 275/81 Koks [1982] ECR 3013; 266/78 Brunori [1989] ECR 2705; 70/80 Vigier [1981] ECR 229; 29/88 Schmitt [1989] ECR 581; C-2/89 Kits Van Heijningen [1990] ECR I-1755; C-275/91 Iacobelli [1993] ECR I-0523. 21 See Joined Cases C-88/95, C-102/95 and C-103/95 Losada, Balado and Paredes [1997] ECR I-869 Nevertheless, the freedom enjoyed by Member States in determining the personal scope of their systems is not unlimited. A considerable degree of uniformity, in any case, is guaranteed by imposing on Member States a duty to comply with the principles of Community law. They cannot, for example, lay down rules which imply discrimination between nationals of the host State and nationals of other Member States (Cases 110/79 Coonan [1980] ECR 1445; 254/84 de Jong [1986] ECR 0671; 43/86 de Rijke [1987] ECR 3611; 349/87 Paraschi [1991] ECR I-4501; 368/87 Troiani [1989] ECR 1333; C-245/88 Daalmeijer [1991] ECR I-555; C-297/92 Baglieri [1993] ECR I-5211; C-12/93 Drake [1994] ECR I-4337; Joined Cases 379, 380, 381/85 and 93/86 Giletti, Giardini, Tampan and Severini [1987] ECR 955; Joined Cases C-45/92 and C-46/92 Lepore and Scamuffa [1993] ECR I-6497). Neither can they impose conditions of residence in their national territory to workers from other Member States (Cases 150/79 Commission v Belgium [1980] ECR 2621; C-307/89 Commission v France [1991] ECR I-2903; C-326/90 Commission v Belgium [1992] ECR I-5517) which would also result in discrimination of these workers. In that sense, Member States are not free to determine the extent to which their own legislation or that of another Member State is applicable (Cases 276/81 Kuijpers [1982] ECR 3013; 302/84 Ten Holder [1986] ECR 1821; 60/85 Luijten [1986] ECR 2365; C-2/89 Kits Van Heijningen [1990] ECR I-1755. See also R Cornelissen,‘The Principle 18 19

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146 Work Interruptions and the Personal Scope of the Co-ordination Regulations of a Community meaning of the term ‘employed’, its definition is still a matter that falls within the competence of national laws. It is not a matter for national labour laws but rather one for the national social security laws, which vary widely. It is considered to be a serious shortcoming of the social security criterion that, due to the great disparities which occur in the different social security systems, some people may avail themselves of Community law while others, in identical circumstances, may not.22 The nature or characteristics of the scheme in question are unimportant in principle, so long as it concerns one of the social security risks named in Art 4(1). Article 4(2) stipulates that Reg 1408/71 is to apply to all general and special social security schemes, whether contributory or non-contributory, and to schemes concerning the liability of an employer or shipowner in respect of the branches of social security covered by the Regulation. Pursuant to Art 4(2a), the Regulation is also to apply to special non-contributory cash benefits which are provided under legislation which, because of its personal scope, objectives and/or conditions for entitlement, has characteristics both of the social security legislation referred to in para 1 and of social assistance.23 Nevertheless, the expansion of social security schemes causes severe problems of classification for different national schemes under Art 4 of Reg 1408/71.24 In addition, Art 5 of Reg 1408/71 stipulates that the Member States are to specify the legislation and schemes referred to in Art 4(1) and (2), and the special noncontributory benefits referred to in Article 4(2a)25 in declarations are to be notified and published in accordance with Art 97. The fact that a Member State has mentioned a given allowance in its declaration must be accepted as proof that the of Territoriality and the Community Regulations on Social Security (Regulations 1408/71 and 574/72)’ (1996) 33 CML Rev 439). As well as the national legislatures, the Community’s legislature is also under an obligation to comply with the principles of Community law. The Court of Justice has laid down that Community rules on social security introduced pursuant to Art 42 of the Treaty must refrain from adding to the disparities that already stem from the absence of harmonisation of national legislation (Cases 41/84 Pinna [1986] ECR 1; 313/86 Lenoir [1988] ECR 5391). 22 See D O’Keefe, above n 10, at 111. 23 Regulation 1408/71 was amended at this point by Reg 647/2005 ([2005] OJ L117/1). The amendment was intended to be a response to the developments occurring, mainly in the case law. Special non-contributory cash benefits are benefits which are intended to provide either: supplementary, substitute or ancillary coverage against the risks covered by the branches of social security referred to in Art 2(1) and which guarantee to the persons concerned a minimum subsistence income having regard to the economic and social situation in the Member State concerned; or solely specific protection for the disabled, closely linked to the said person’s social environment in the Member State concerned. The financing for the benefits, according to the same provision, derives exclusively from compulsory taxation intended to cover general public expenditure and the conditions for granting and calculating the benefits are not dependent on any contribution in respect of the beneficiary. Finally, the benefits are listed in Annex IIa. Annex IIa was also amended by the same Regulation. See also Reg 629/06 ([2006] OJ L114/1); COM (2005) 676 final, aimed at further amending the Annexes to Reg 1408/71 in order to reflect changes in Member States’ legislation is currently pending. 24 On the contrary, pursuant to Art 4(2)(b) of Reg 1408/71, the Regulation does not apply to specific non-contributory benefits, which are referred to in Annex II, Section III. See also Case C-286/03 Hosse [2006] ECR I-1771. 25 As well as the minimum benefits referred to in Art 50, and the benefits referred to in Articles 77 and 78 of Reg 1408/71.

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The Persons Covered by the Co-ordination System 147 benefits relating to that allowance are social security benefits within the meaning of the Regulation.26 On the other hand, the fact that a national law or regulation has not been specified in the declarations referred to in Art 5 is not of itself proof that that law or regulation does not fall within the field of application of Reg 1408/71.27 A line of distinction, however, is drawn between social security and social assistance in Art 4(4). This provision excludes social and medical assistance from the material scope of application of Reg 1408/71.28 Problems can arise with regard to schemes that cover the entire population in a Member State. It emerges from Art 1(a) that the scheme at issue can be for all residents or for the entire working population. According to Art 1(a)(ii), however, when the scheme at issue is a scheme for all residents or for the entire working population, the person concerned must be identified as an employed or selfemployed person on the basis of certain criteria. According to the first criterion, a person is regarded as ‘employed’ or ‘self-employed’ if s/he ‘can be identified as an employed or self-employed person by virtue of the manner in which such a scheme is administered or financed’. Failing this, a person is regarded as ‘employed’ or ‘selfemployed’ if s/he is insured for some other contingency specified in Annex I or complies with the definition given in that Annex. Annex I contains definitions of ‘employed’ and ‘self-employed’ with respect to each Member State.29 It should be noted here that the definitions of Annex I displace the general definition of Art 1(a) with regard to specific benefits, which may lead to a narrowing of the scope of Reg 1408/71 when it comes to the award of specific benefits.30 Thus, general schemes covering economically non-active people are not covered by Reg 1408/71. Practically, this means that people who have never joined the labour market cannot satisfy the social security criterion of Reg 1408/71, even if they are covered by a national scheme. Consequently, the social security criterion refers to employment-related social security, that is to say social insurance. The requirement of employment-related social security has, however, been subject to increased pressure, especially after the entry into the Union of Member States with 26

Cases 35/77 Beerens [1977] ECR 2249; 237/78 Palermo [1979] ECR 2645. Case 35/77 Beerens [1977] ECR 2249. See also Cases C-70/80 Vigier [1981] ECR 0229; C-251/89 Athanassopoulos [1991] ECR I-2797; C-327/92 Rheinhold & Mahla [1995] ECR I-1223. 28 The increasingly blurred distinction between social security and social assistance causes severe problems of interpretation. There is abundant case law and literature with regard to the branches and the kinds of schemes covered by Reg 1408/71, in particular as regards the distinction between social security/social assistance. See eg F Pennings, Introduction to European Social Security Law (The Hague, Kluwer, 2001), ch 7; P Langlois, ‘The Co-ordination of State Pension Schemes and the Non-Coordination of Occupational Pension Schemes’ in E Eichenhofer (ed), Social Security of Migrants in the European Union of Tomorrow (Osnabrück, IMIS-Schriften, 1997); H Verschueren, ‘Libre circulation des personnes et protection sociale minimale’ (1996) 2 Revue du marché unique européen 83. See also Joined Cases 379, 380, 381/85 Gilettt, Giardini, Tampan och Severini [1987] ECR 955; Cases 1/72 Frilli [1972] ECR 0457; C-57/96 Meints [1997] ECR I-6689; C-160/96 Molenaar [1998] ECR I-843; C-43/99 Leclere and C-215/99 Jauch [2001] ECR I-1901; and Joined Cases C-502/01 and C-31/02 Gaumain-Cerri and Barth [2004] ECR I-06483. 29 See also Case 84/77 Tessier [1978] ECR 7. 30 For example, with regard to granting family benefits when the competent institution is a German institution, Case C-194/96 Kulzer [1998] ECR I-895. 27

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148 Work Interruptions and the Personal Scope of the Co-ordination Regulations residence-based systems, and the new Regulation 883/04 amends the co-ordination system on this point. iii. The Nature of the Affiliation to a National Scheme Pursuant to Art 1(a) of Reg 1408/71, a person comes within the scope of application of the Regulation if s/he is insured compulsorily, voluntarily or on an optional continued basis in a national social security scheme for one or more of the risks covered by the Regulation. Art 1(a)(i), (ii) and (iii) refers to compulsory insurance, while Art 1(a)(iv) refers to voluntary insurance. The notion of compulsory insurance has not raised any problems of interpretation. With regard to voluntary insurance, Art 1(a)(iv) states that a voluntary insured person is regarded as ‘employed’ or ‘self-employed’ within the meaning of the Regulation in two cases: first, if such a person carries out an activity as an employed or self-employed person; or second, if such a person has previously been compulsorily insured for the same contingency under a scheme for employed or self-employed persons of the same Member State.31 No definition of voluntary insurance as such is included in any provision of Reg 1408/71, but the notion should be clear enough. In contrast, the meaning of ‘optional continued basis’ is unclear, and the Regulation makes no attempt to explain it. An interpretation of the term was given by Advocate General Mischo in the Laborero and Sabato cases.32 Accordingly, the mere continuation on an optional basis of insurance under the same scheme under which a person had previously been compulsorily insured falls within the concept of insurance ‘on an optional continued basis’mentioned in Article 1(a)(i) and (ii).33 Article 9 of the Regulation contains the rules for admission to voluntary or optional continued insurance.34 No definition or distinction of the two terms is given within the framework of this article either. Assimilating periods of study to periods of employment as provided in national legislation for the purposes of insurance is an example. Such assimilation is covered by the expression ‘voluntary or optional continued insurance’, whether there was any continuation of existing insurance or not.35 31

See also Case 300/84 Van Roosmalen [1986] ECR 3097. Joined Cases 82/86 and 103/86 Laborero and Sabato [1987] ECR 3401, Opinion of Advocate General Mischo delivered on 4 June 1987, para 16. 33 Watson mentions the example of medical insurance in Germany, which is compulsory for nonindustrial workers whose salary does not exceed a certain amount each year. When a worker’s salary exceeds this amount, he can opt to remain covered or to quit the scheme. See P Watson, above n 11, at 67. See also the MISSOC comparative tables. 34 Article 9(1) stipulates that when the provisions of the legislation of any Member State make admission to voluntary or optional continued insurance conditional upon residence in the territory of another Member State, these provisions shall not apply to persons resident in another Member State, provided that at some time in their past working life they were subject to the legislation of the first State as employed or as self-employed persons. Article 9(2) stipulates that where, under the legislation of a Member State, admission to voluntary or optional continued insurance is conditional upon completion of periods of insurance, the periods of insurance or residence completed under the legislation of another Member State shall be taken into account, to the extent required, as if they were completed under the legislation of the first State. 35 Case 93/76 Liegeois [1977] ECR 0543. The case concerned a Belgian national who had studied in Belgium and France before performing his military service in Belgium. After that, he worked in France, 32

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The Persons Covered by the Co-ordination System 149 It must be underlined that, irrespective of the kind of insurance demanded, it need not be active. This means, for example, that a person does not need to be paying contributions for a social security risk at the time the contingency occurs. The person concerned will still be regarded as a worker within the meaning of Reg 1408/71 if s/he is entitled under the legislation of any Member State to benefits for that risk, by virtue of contributions previously paid compulsorily.36 On the basis of the analysis so far, the answer to the question of whether people interrupting employment due to childbirth/child-rearing and migration are covered by the co-ordination system must be sought in the criterion of social security. Community law in this field, however, contains another important development referring to the application of Reg 1408/71 to people who are not covered by any national system at all. This important issue will now be examined. b. The Lack of Insurance A person does not need to pay contributions at the time a contingency occurs, as stated above, but what if s/he is completely uninsured? In accordance with the case law of the Court of Justice, Reg 1408/71 can in some cases cover even uninsured persons. This was established in the Mouthaan case.37 The Court ruled that ‘employed or self-employed’ status within the meaning of Reg 1408/71 is acquired when the worker complies with the substantive conditions laid down objectively by the social security scheme applicable to her/him, even if the steps necessary for affiliation to that scheme have not been completed. The question arose within the context of a dispute between a Dutch national, residing in the Netherlands, and the Dutch social security institution where he submitted an application for unemployment benefits. Mr Mouthaan had most recently been employed in Germany by a Netherlands undertaking established in the Netherlands. During his employment in Germany he had remained resident in the Netherlands, and he was not insured under German law. When he became unemployed, he applied for benefits in his state of residence. The Dutch competent social security institution refused to pay him unemployment benefits, saying that he was not insured in Germany—the country of his last employment. and then studied in the United States before returning to France, where he worked for a while. Subsequently, he worked in the United States and finally he returned to work in Belgium. He requested assimilation of his periods of study to periods of employment for the purposes of determining his pension rights. To this end, he maintained that the regularisation of periods of study was a matter of admission to continued voluntary or optional insurance involving the application of Art 9(2). His request was rejected by the national social security institution, first on the ground that the assimilation of periods of study to periods of employment did not constitute admission to voluntary insurance and, second, that Art 9(2) applied only to periods of voluntary or optional insurance completed after a period of compulsory insurance. A question was raised, therefore, concerning the concept of continued insurance and the distinction between voluntary and optional continued insurance in Art 9(2). The Court found that a comparison of the wording of Art 9 in the various official languages (six at the time) demonstrated variations, both with regard to the distinction between voluntary and optional insurance, and with regard to the concept of continued insurance: ‘The different expressions used anyhow show an intention to cover every type of insurance incorporating a voluntary element and it matters little whether there is any continuance of existing insurance or not.’ 36 Case 143/79 Walsh [1980] ECR 163. 37 Case 39/76 Mouthaan [1976] ECR 1901.

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150 Work Interruptions and the Personal Scope of the Co-ordination Regulations Consequently, the institution argued that he could not be considered to be covered by Reg 1408/71. The Court held that Art 1(a) of Reg 1408/71 does not seek to restrict the status of ‘worker’ within the meaning of that Regulation to persons who are in fact insured under a social security scheme specified in the Regulation. It is intended to define all people to whom such schemes are applicable as workers.38 [C]onsequently it must be accepted that the status of worker within the meaning of Regulation 1408/71 is acquired when the worker complies with the substantive conditions laid down objectively by the social security scheme applicable to him even if the steps necessary for affiliation to that scheme have not been completed.39 (emphasis added)

A similar question was raised in the Zinnecker case.40 This case was different from Mouthaan in the sense that it was not clear from the beginning whether the person concerned should be regarded as an employed or self-employed person.41 Nevertheless, the Court found that Reg 1408/71 applied to Mr Zinnecker because he had complied with the Netherlands declaration contained in Annex I.I to the Regulation,42 despite the fact that he was not insured in any of the Member States involved.43 A question that might be raised at this point is what impact this case law can have on workers in the informal sector of the economy. Workers may remain outside the social security system for many reasons, for instance due to an employer’s unwillingness. Does Reg 1408/71 cover them, provided that they satisfy the substantive conditions of a national scheme or a national declaration? Watson finds that it is ‘undoubtedly true’ that a worker does not need to be insured before the Regulation can apply to her/him. She argues that such a view is underpinned by the fact that Title II of the Regulation contains rules that determine the legislation under which a worker is to be insured: ‘The authors of the Regulation cannot, therefore, have intended that the Regulation apply only to persons actually insured.’ Van 38

Paragraph 8 of the judgment. Paragraph 10 of the judgment. 40 Case C-121/92 [1993] ECR I-5023. 41 The case illustrates the interplay between Title I and Title II of Reg 1408/71. 42 In accordance with this declaration, any person pursuing an activity or occupation without a contract of employment shall be considered a self-employed person within the meaning of Art 1(a)(ii). The Court pointed out that the Netherlands declaration did not lay down any requirement of residence in the Netherlands on the part of the people concerned. In other words, the Court found that Mr Zinnecker satisfied the conditions of the Netherlands declaration made for the purposes of application of Reg 1408/71, although he did not satisfy the conditions of the national legislation. Zinnecker can be seen as a complement to Mouthaan in the sense that it showed that Reg 1408/71 applies not only in the case of an uninsured person who satisfies the substantive conditions of the national legislation, but also in the case of an uninsured person who does not satisfy these conditions. In the latter case, however, the person concerned has to satisfy the substantive conditions of the declaration made by the Member State in question, for the purposes of determining the personal scope of Reg 1408/71 in relation to that particular Member State. 43 The Court also ruled that it is enough for a person to come under the scope of the Regulation by virtue of the legislation of only one Member State. Thus, in the concrete case, it was not important if the person concerned satisfied the conditions of the German legislation. It was sufficient that s/he satisfied the conditions of the Netherlands declaration. 39

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The Persons Covered by the Co-ordination System 151 Raepenbusch is of the same opinion: ‘It would be strange were the authors of the Regulation to have considered that a “worker” should first be insured before the Regulation could apply to him.’44 An issue which arises, however, is whether the Court intended to extend, as a matter of principle, the scope of application of Reg 1408/71 to the (presumably) many uninsured persons working in the informal sector of the economy. This would mean, then, that Reg 1408/71 would be applicable even in the case of persons on whose account no contributions have been paid. Watson rightly draws attention to the fact that the Mouthaan decision may even lead to the avoidance of social security obligations on the part of employers, thus offering them a financial advantage over competitors. As she points out, the decision obliges social security authorities to be ultra diligent in the collection of contributions from employers in respect of their employees. Furthermore, migrant workers would be placed in a better position than non-migrant workers. No clue is offered in the Mouthaan judgment as to the Court’s intentions or motives. Watson notes: [I]t is quite clear that the Court was influenced in its decision by the possibility of hardship being caused to the worker who honestly believed himself to be insured in such a way as to have the protection of Regulation 1408/71. The Court no doubt gave what is considered to be an equitable decision: a worker should not suffer because of the negligence or ill-will of his employer.

As Watson notes, the Commission also supported this line of argument in Mouthaan. Even in the Commission’s view, the wrong committed by his employer could not work to the detriment of the respondent, who in good faith might have thought that he was insured (in the Netherlands).45 Watson emphasises that the Mouthaan decision will not help the worker who is either entitled to be covered under the social security system of a Member State or is required to be compulsorily affiliated to that system, but who deliberately refrains from taking steps to obtain coverage.46 Thus, she draws a distinction between lack of insurance due to the illwill of the employer, and lack of insurance due to the ill-will of the worker himself. These distinctions, however, are not made in the judgment but rather in the academic literature. One can ask how the ill-will of the worker should be defined. For instance, what about the worker who is conscious of the situation but accepts it as a competitive advantage in order to gain employment? Before concluding this section, the gender implications of the Mouthaan precedent must be underlined. There are extensive informal economic sectors in several Member States, and women are often employed in them. A considerable number of women formally regarded as housekeepers and housewives, perhaps mostly in the southern Member States, work in the informal sector without any contract of employment or formal insurance. Many women also work in family 44

P Watson, above n 11, at 75; S Van Raepenbusch, above n 12, at 76. See also D O’Keefe, above n 10, at 111. 45 P Watson, above n 11, at 75. 46 Ibid.

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152 Work Interruptions and the Personal Scope of the Co-ordination Regulations enterprises without being formally employed or insured. They may well be aware of their exclusion from the social security system and accept it for different reasons. A question that arises is whether they should be covered by Mouthaan or whether they should fall outside it, considered as being of ill-will. It is currently difficult to answer this question, and the state of law under Reg 1408/71 must be considered unclear at this point. Reg 883/04 may bring several persons within the scope of the coordination system, but it is perhaps doubtful whether this will solve the problems, as there will always be people not covered by national systems. This is discussed in sub-section 2.2 below. 1.2 The Condition of Movement Apart from being an ‘employed or self-employed’ person, ie apart from satisfying the criterion of social security, a person has to satisfy the criteria of movement and nationality in order to be covered by Reg 1408/71. Attention here will now focus on the criterion of movement as it defines the concept of migrant in this context. Regulation 1408/71 does not apply to situations that are purely internal to a Member State. This was established by the Court in the Petit case.47 This case referred to the right of a Belgian national, who had always lived and worked solely in Belgium, to use French, his native language, in proceedings before a Belgian court regarding a dispute between him and the Belgian social security authorities. The Court held that the situation was confined in all respects within a single Member State, and, consequently, Reg 1408/71 was not applicable.48 Thus, an element of movement between different Member States is necessary for Reg 1408/71 to apply. This movement, however, does not need to be undertaken in the capacity of employment, or to have any connection whatsoever with the pursuit of an economic activity.49 The Regulation is not limited to workers who have been employed in several Member States or who are, or have been, employed in one state whilst residing or having resided in another. This results from the wording of Art 2(1), which provides that the Regulation is to apply to workers who are or have been subject to the legislation of one or more Member States. This had already been established by the Court in the Unger case, as mentioned above. Ms Unger fell ill during a social visit in another Member State. The Court established that the Regulation applies to people regarded as workers in the Community sense of the term,‘whatever may be the reason for their temporary residence abroad’.50 That movement does not have to be in connection with work was further entrenched in a series of judgments.51 Disconnecting movement from employment 47

Case C-153/91 [1992] ECR I-4973. See, though, Case 31/64 Bertholet [1965] ECR 81. See also Joined Cases C-95/99 to C-98/99 and C-180/99 Khalil et al [2001] ECR I-7413. 49 See also F Burrows, Free Movement in European Community Law (Oxford, Clarendon Press, 1987). 50 Above, at 1.1. 51 The first important case in this context was Maison Singer (Case 44/65 [1965] ECR 1191). This case concerned a German worker who was killed in a road accident while on holiday in France. His dependants were paid by the German social security authorities. The authorities later sought to sue the driver of the vehicle who was responsible for the accident. For this purpose, they needed to rely on the 48

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The Persons Covered by the Co-ordination System 153 was one of the most important developments in the last decade and led to a considerable extension of the range of situations to which Reg 1408/71 applies. Thus, even people who are not migrant workers or have never moved from their country of origin can now enjoy the benefits of co-ordination of social security, at least when the benefits at issue are sickness benefits. One of the milestones of this development was the Kohll case.52 Although it was mainly judged on the basis of the provisions as to freedom to provide services,53 the importance of the case for the system of co-ordination of social security, particularly with regard to the condition of movement as a pre-condition for the application of Reg 1408/71, has been underlined on many occasions. The plaintiff and the members of his family had not satisfied the condition of movement at all, as their need for treatment did not even emerge during a temporary stay in another Member State. Neither had they satisfied the other condition of Reg 1408/71, namely the condition of authorisation prior to their movement. Despite this, Reg 1408/71 was found to be applicable.54 co-ordination regulation in force at that time, ie Reg 3/58. The question was raised as to whether Reg 3/58 applied, as the person in question had not moved in connection with work, but on holiday. The Court once again made reference to the objective of Art 42 of the Treaty, ie the establishment of as complete freedom for workers as possible,‘which thus forms part of the ‘foundations’ of the Community’. It would not be in conformity with that spirit, the Court held, to limit the concept ‘worker’ solely to migrant workers stricto sensu or solely to workers required to move for the purpose of their employment. Nothing in Article 51 imposes such distinctions, which would in any case tend to make the application of the rules in question impracticable. See also Cases 115/77 Laumann [1978] ECR 805; C-194/96 Kulzer [1998] ECR I-895; and C-255/99 Humer [2000] ECR I-1205. 52 Case C-158/96 [1998] ECR I-1931. This case concerned the application of Art 22 of Reg 1408/71, included in Title III, and referred to sickness benefits in kind. A doctor established in Luxembourg made a request for authorisation for the minor daughter of a Luxembourg national to receive treatment from an orthodontist established in Trier, Germany. The request was rejected by the competent social security authority in Luxembourg, with which the father of the girl—Mr Kohll—was insured The grounds for the rejection were that the proposed treatment was not urgent, and that it could be provided in Luxembourg. Mr Kohll was not a migrant worker. The case did not raise any question as to the definition of ‘employed’ in the meaning of Title I or Title III of Reg 1408/71, or of the condition of movement. It did, however, raise questions concerning the application of Reg 1408/71 in general, as well as questions concerning the freedom to provide services. With regard to Reg 1408/71 in particular, the question raised was whether Art 22(1) was applicable. Pursuant to the provisions of this article, an employed or self-employed person who satisfies the conditions of the legislation of the competent state for entitlement to benefits is entitled, under some conditions, to benefits in cash and kind in another Member State. One of these conditions is prior authorisation by the competent institution to go to the other Member State in order to receive the treatment appropriate to his condition there (below, ch 5). Mr Kohll, whose request for authorisation was rejected on the basis of national rules—which also required prior authorisation—argued that the national rules, although they were consistent with Reg 1408/71, were not consistent with Articles 59 and 60 of the Treaty concerning the freedom to provide services. The Court held that the fact that the case was a social security case did not exclude the application of Arts 59 and 60 of the Treaty (para 21 of the judgment). It also ruled that Arts 59 and 60 preclude national rules, which has the result that the provision of medical treatment in another Member state is subject to authorisation by the competent social security institution in the individual case. 53 For a critical view towards this approach see M Fuchs, ‘Free Movement of Services and Social Security—Quo vadis?’ (2002) 8 European Law Journal 536. The author argues that the solution to the problems of health care have to be found within the ambit of the rules and principles of co-ordination, calling for their further development. 54 See also C-120/95 Decker [1998] ECR I-1831 concerning the purchase of eye glasses in another Member State; C-368/98 Vanbraekel [2000] ECR I-5363 concerning the reimbursement of medical

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154 Work Interruptions and the Personal Scope of the Co-ordination Regulations The major consequence of the Court’s judgment in this case, however, is that the provisions of Art 22 became relevant for all insured persons in the Member States. In the opinion of some authors, this case constitutes a good example of how Regulation 1408/71 has grown beyond the original framework of freedom of movement. Under certain circumstances, the fact that a person has never worked or resided in another Member State is not, as such, an obstacle to entitlement to medical care in another Member State.55 1.3 The Condition of Nationality Regulation 1408/71 applies to persons who are nationals of a Member State. The condition of nationality has long been one of the most criticised conditions for the application of Reg 1408/71.56 The extension of coverage to third country nationals expenses incurred in another Member State for medical treatment received there, without prior authorisation from the competent social security institution; C-157/99 Smits and Peerbooms [2001] ECR I-5473 concerning the conditions for refusing authorisation to a person to receive medical treatment in another Member State. According to the judgment, such an authorisation cannot be refused on the ground that the treatment is not ‘normal’, when it appears that the treatment has been sufficiently tried and tested by international medical science. Furthermore, authorisation can be refused on the ground of lack of medical necessity only if the same or equally effective treatment can be obtained without undue delay at an establishment having a contractual arrangement with the insured person’s sickness insurance fund. See also Cases C-385/99 Müller-Fauré [2003] ECR I-4509 concerning the condition of prior authorisation and assumption of costs for non-hospital and hospital care in another Member State; C372/04 Watts [2006] ECR I-4325 concerning reimbursement of costs for hospital treatment; C-466/04 Herrera [2006] ECR I-5341 where the Court ruled that costs of travel, accommodation and subsistence are not reimbursed. For discussion concerning the Decker and Kohll cases, see S Van Raepenbusch, ‘La libre choix par les citoyens Européens des produits médicaux et des prestataires de soins, conséquence sociale du Marché Intérieur-n sous les arrêts du 28 avril 1998, Decker, C-120/95 et Kohll, C-158/96’ [1998] Cahiers de Droit Européen 683; CF Durand and S Van Raepenbusch,‘Les principaux développements de la jurisprudence de la Cour de justice et du Tribunal de première instance (du 1er août 1997 au 31 juillet 1998)’ [1999] Cahiers de Droit Européen 424; R Giesen,‘Case C-120/95 Nicolas Decker v. Caisse de maladie des employés privés; Case C-158/96, Raymond Kohll v Union des caisses de maladie’ (1999) 36 CML Rev 841. 55 See also R Cornelissen, above n 21. The development of Community law in this area has been greeted enthusiastically by many parties, including the Commission, as establishing the ‘free movement of patients’, although this freedom appears to be quite limited It has been pointed out that free movement seems to go only as far as the financial capacity of the patient allows, since the costs of the medical treatment abroad are reimbursed according to the tariffs of their Member State of residence (P Cabral, ‘Cross-border Medical Care in the European Union—Bringing Down a First Wall’ (1999) 24 EL Rev 387. See also S Van Raepenbusch, above n 54). On the other hand, it has been received with a lot of scepticism and reluctance to follow it on the part of the social security authorities in the Member States. Nevertheless, this is the area where the most rapid and spectacular developments currently occur. 56 An overwhelming majority of legal authors supported an extension of the Regulation to third country nationals, mainly on the basis of the equal treatment principle. See eg D Pieters, ‘Enquiry into the Legal Foundations of a Possible Extension of Community Provisions on Social Security to Third Country Nationals Legally Residing and/or Working in the European Union’ in E Eichenhofer, above n 28; H Verschueren, ‘EC Social Security Co-ordination Excluding Third Country Nationals: Still in Line with Fundamental Rights after the Gaygusuz Judgment?’ (1997) 34 CML Rev 991; S Peers,‘Equality, Free Movement and Social Security’ (1997) 22 EL Rev 342; C Laske, ‘The Impact of the Single European Market on Social Protection for Migrant Workers’ (1993) 30 CML Rev 531, at 531; M Moore, ‘Freedom of Movement and Migrant Workers’ Social Security: An Overview of the Court’s Jurisprudence 1992–1997’ (1998) 35 CML Rev 409, at 456; P Watson, above n 11, at 80–82; M Malmstedt, ‘From Employee to EU Citizen—A Development from Equal Treatment as a Means to Equal Treatment as a

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The Persons Covered by the Co-ordination System 155 has been politically controversial. A few years ago, however, a new Regulation—Reg 859/0357—was adopted, according to which Reg 1408/71 is to apply to nationals of third countries who are not already covered by those provisions (refugees, stateless persons, members of the family) solely on the ground of their nationality, as well as to members of their families and to their survivors. The conditions for the application of Reg 1408/71 to third country nationals are that they are legal residents in the territory of a Member State, and that they are in a situation that is not confined in all respects within a single Member State.58 The preamble clarifies that the extension does concern third country nationals who have links only with a third country and a single Member State.59 Regulation 859/03 was based on Art 63(4) of the EC Treaty and aims at granting third country nationals a set of uniform rights as close as possible to those enjoyed by EU citizens.60 It clearly states that it does not give them any entitlement to enter, stay or reside in a Member State or have access to its labour market.61 The Regulation is also without prejudice to any rights and obligations arising from international agreements with third countries to which the Community is a party, and which afford advantages in terms of social security.62 The extension of Reg 1408/71 to third country nationals has been one of the most debated extensions. Despite receiving overwhelming support in the legal literature, it was long met with resistance at the political level.63 Regulation 859/03 intends to provide rights as close as possible to those of EU citizens, and the question is of course how close the rights shall or can be. Reservations have been made by some Member States as to the application of Reg 859/03. Denmark is not bound by or subject to it, in accordance with articles 1 and 2 of the Protocol on the position of Denmark annexed to the Treaty on European Union and to the Treaty establishing the European Community.64 Ireland and the United Kingdom, on the contrary, expressed their wish to participate in the adoption and application of the new Goal’ in A Numhauser-Henning (ed), Legal Perspectives on Equal Treatment and Non-Discrimination (The Hague, Kluwer Law International, 2001); R White, above n 12, at 136 et seq. 57 [2003] OJ L124/1. 58 Regulation 859/03, Art 1. 59 Preamble, 4th recital, at point 12. 60 Ibid, at 7. 61 Ibid, at 10. 62 Ibid, at 16. 63 The UK has been one of the strongest opponents to such an extension. The response of the UK Government to the argument that Articles 51 and 235 provide the legal basis for an extension was that the right of freedom of movement conferred by the Treaty applied only to citizens of the Community. It also held the view that the task of promoting a high level of social protection set out in Art 2 of the EC Treaty applied only to its citizens, and not to legally resident third country nationals. In addition, prior to the implementation of the Treaty of Amsterdam, the view of the UK Government was that extension to third country nationals of rights and benefits enjoyed by Community citizens would be a fundamental extension of the Community’s objectives, and that this would require an amendment of the Treaty. After the Treaty of Amsterdam came into force, the UK suggested that Art 63(4) (ex Art 73k) of the Treaty would be instead a possible legal base for the extension of the Regulation; see S Roberts, ‘‘Our View Has Not Changed’, the UK’s Response to the Proposal to Extend the Co-ordination of Social Security to Third Country Nationals’ (2000) 2 European Journal of Social Security 189. 64 See preamble, 4th recital, at point 19.

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156 Work Interruptions and the Personal Scope of the Co-ordination Regulations Regulation.65 Special provisions concerning family benefits are made in the Annex to the Regulation with regard to Germany and Austria. Pursuant to them, in the case of family benefits, this Regulation is to apply only to third country nationals who are in possession of a residence permit meeting the definition in German law of ‘Aufenthaltserlaubnis’ or ‘Aufenthaltsberechtigung’. Also, in the case of family benefits, this Regulation is to apply only to third country nationals who fulfil the conditions laid down by Austrian legislation for permanent entitlement to family allowances. In addition, Reg 859/03 contains a number of provisions concerning the time of application and the effects of the extension. Thus, this Regulation does not create any rights in respect of the period before 1 June 2003.66 Nevertheless, any period of insurance and, where appropriate, any period of employment, self-employment or residence completed under the legislation of a Member State before 1 June 2003 is to be taken into account for the determination of rights acquired in accordance with the provisions of the Regulation.67 Subject to the provisions of paragraph 1, a right is to be acquired under the Regulation even if it relates to a contingency arising prior to 1 June 2003.68 Any benefit that has not been awarded or that has been suspended on account of the nationality or the residence of the person concerned is, at the latter’s request, to be awarded or resumed from 1 June 2003, provided that the rights for which benefits were previously awarded did not give rise to a lump-sum payment.69 The rights of people who prior to 1 June 2003 obtained the award of a pension may be reviewed at their request, account being taken of the provisions of the Regulation.70 If the request referred to in paragraph 4 or paragraph 5 is lodged within two years from 1 June 2003, rights deriving from this Regulation are to be acquired from that date and the provisions of the legislation of any Member State on the forfeiture or lapse of rights may not be applied to the people concerned.71 If the request referred to in paragraph 4 or paragraph 5 is lodged after the expiry of the deadline referred to in paragraph 6, rights not forfeited or that have not lapsed are to be acquired from the date of such request, subject to any more favourable provisions of the legislation of any Member State.72 Refugees, stateless persons and members of the family of a Community worker who do not themselves possess the nationality of a Member State, are covered by Reg 1408/71. However, a family member can only claim benefits granted to family members, and not benefits granted on the basis of the beneficiary’s own situation.73

65 66 67 68 69 70 71 72 73

See preamble, 4th recital, at 18. Regulation 859/03, Art 2(1). Ibid, Art 2(2). Ibid, Art 2(3). Ibid, Art 2(4). Ibid, Art 2(5). Ibid, Art 2(6). Ibid, Art 2(7). Case 94/84 Deak [1985] ECR 1873; see also below, ch 7.

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The Persons Covered by the Co-ordination System 157 1.4 Economic Activity and the Personal Scope of Reg 1408/71 The discussion so far has made it clear that people interrupting work because of childbirth/child-rearing are covered by Reg 1408/71. On the other hand, it is not clear whether people interrupting employment because of migration are also covered by the Regulation.Although the emphasis on the criterion of social security rather than that of economic activity underpins the conclusion that this is the case, such a conclusion needs additional support. To this end, a short account of the developments concerning the term ‘employed or self-employed persons’, with a particular focus on people not pursuing an economic activity, is now presented. These developments occurred in several stages over many years, involved many cases and amendments of Reg 1408/71, all of them following the line established in the Unger case. Unger laid the ground for two important developments: first, the disassociation of the personal scope of Reg 1408/71 from the concept of ‘worker’ as defined in labour law; and second, the disconnection of the personal scope of Reg 1408/71 from the active pursuit of an economic activity. These two developments are now discussed in more detail. a. The Nature of Economic Activity It goes without saying that pople with a typical full-time contract of employment are covered by the Community concept of ‘employed’. This kind of employment generally gives access to the most complete social security protection in all Member States. This has to do with the historical development of the institution of social security.74 Employees, and in particular full-time employees, were also the group initially targeted by the social security regulations within the framework of an Economic Community, and of south-north migration of unskilled labour.75 On the basis of the social security criterion, however, the Court has extended the personal scope of the Regulation significantly. Today, the Community notion of ‘employed’ stretches well beyond the group of typical full-time employees, to many other categories of economically active people. It covers part-time employees, atypical employees and self-employed persons, as well as farmers and civil servants. With regard to part-time employees,76 the amount of time a person devotes to her/his activities is of no significance for the application of Reg 1408/71, if the 74

See above, ch 1. Above, ch 1. For a discussion of the changed context of Reg 1408/71, see J Berghman,‘Social Effects of Social Security Co-ordination in the European Union of Tomorrow’ in E Eichenhofer, above n 28, at 45–51. The writer concludes that the relevance, and maybe even the legitimacy, of the existing coordination regulations has been overtaken. In this sense, he notes, these regulations have been overruled by reality. He argues, however, for the necessity of social security co-ordination ‘but then in its double new meaning of convergence of labour inducing social policies within a European Union context and in the sense of preventing migration by making the actual pull effect redundant. That is: by increasing the social balance and social rights in Central and Eastern Europe and Northern Africa’. For the changing context of Reg 1408/71, its function and shortcomings in such a context, see C Laske, above n 56. 76 For a discussion of social security problems in cases of part-time employment, see A Euzéby,‘Social Security and Part-time Employment’ (1988) 127 International Labour Review 545. See also M Cousins, ‘Social Security and Atypical Workers in Ireland’ (1992) 131 International Labour Review 647. 75

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158 Work Interruptions and the Personal Scope of the Co-ordination Regulations person concerned meets the other conditions laid down by the Regulation. Even if s/he is employed for as few as four hours in a week, s/he is covered by Reg 1408/71 in the capacity of ‘employed’ person, if s/he meets the conditions laid down in Article 1(a) in conjunction with Article 2(1) of the Regulation.77 Atypical employees also qualify as ‘employed’ persons within the meaning of Reg 1408/71.78 Self-employed persons eventually came within the scope of Reg 1408/71 in 1981 after its amendment by Reg 1390/81. That extension was based on the liberal and broad interpretation of the personal scope provisions made by the Court of Justice in previous years. It was a remarkable development, since self-employed persons are not linked to social security in the same way as paid employees. In many countries, schemes for the self-employed were, and still are, quite underdeveloped.79 The extension to self-employed persons became imperative for several reasons: first, in view of the progress made towards realising the freedom to establish and freedom to provide services; second, because the original six Member States’ social security schemes were increasingly providing or strengthening social protection for selfemployed workers; and finally, because in two of the new Member States, selfemployed persons enjoyed the same, or almost the same, social security as 77 Case C-2/89 Kits Van Heijningen [1990] ECR I-1755. The case referred to a person residing in Belgium where he worked full-time, and at the same time he worked as a teacher at a Netherlands educational institution for two hours a day, two days per week. After his retirement in Belgium he continued to work part-time as a teacher in the Netherlands. When he claimed child allowances from the Netherlands authorities in respect of his two children, who were studying, his claim was rejected on the ground that he did not meet the conditions of the national law, as a result of his very limited employment. According to the Dutch authorities, Mr Van Heijningen was insured only on the days when he was teaching, and that was not enough to qualify him for the award of allowances according to the national law. The Court ruled that a person who is employed for as few as four hours weekly is covered by Reg 1408/71, holding: ‘There is nothing in Article 1(a) or Article 2(1) of Regulation No 1408/71 which permits certain categories of persons to be excluded from the scope of the regulation on the basis of the amount of time they devote to their activities’ (para 10 of the judgment). 78 Case 84/77 Tessier [1978] ECR 7. The issue in this case was whether an au pair could be regarded as ‘employed’ for the purposes of the application of Art 1(a) of Reg 1408/71. That issue was raised in the context of a dispute between Ms Tessier and the French social security authorities. After completing her studies, Ms Tessier spent some time in Great Britain, working as au pair and attending evening classes. During her stay, she was entitled to use the National Health Service, like all people ordinarily resident in the United Kingdom. After her return to France, she registered as a person seeking employment, and applied for French sickness insurance benefits in respect of medical treatment received in that country. Her application was rejected on the ground that she did not fulfil the requirements of the national law for a certain number of hours of employment or assimilated work, during a reference period before the contingency occurred. The question arose, therefore, as to whether she might be entitled to claim the benefits by virtue of Reg 1408/71. The application of Reg 1408/71 was invoked on the ground of the period she spent in Great Britain, where she was insured. If Reg 1408/71 applied, that insurance period would have to be assimilated to the reference period laid down by French law. The decision of the Court of Justice made it clear that the kind of economic activity pursued, or the very fact of pursuing an economic activity, were not of significance for qualifying as ‘employed’ in the meaning of the Regulation. As the British scheme was for all residents, what was important was that she complied with the provision of Art 1(a)(ii) of Reg 1408/71, in particular that she complied with the definition included in the British declaration contained in Annex I. The criterion in the British definition was that the person concerned paid social security contributions as an employed person. 79 For an account of the social security of self-employed persons in different Member States, see P Schoukens, ‘Comparison of the Social Security Law for Self-Employed Persons in the Member States of the European Union’ in D Pieters (ed), Changing Work Patterns and Social Security, EISS Yearbook 1999 (The Hague, Kluwer Law International, 2000).

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The Persons Covered by the Co-ordination System 159 employed workers. Yet it was not realised until 1981, although such an extension had originally been envisaged by the Commission as early as 1966, within the framework of revising Reg 3/58. At that time, however, the plans for extension were abandoned.80 Even the term ‘self-employed’ has been interpreted broadly. The Court has emphasised that: [S]ince Regulation No 1390/81 was adopted in order to achieve the same objectives as Regulation No 1408/71, the concept of ‘self-employed person’ is intended to guarantee to such people the same protection as is accorded to employed persons and must therefore be interpreted broadly.81

A major recent extension of Reg 1408/71 concerned civil servants,82 who were initially excluded from the scope of people covered by the social security law of the European Community. Later, Community law was extended to cover civil servants insured under general schemes, while those insured under special schemes for civil servants remained excluded. Regulation 1408/71 was finally amended by Reg 1606/98.83 Even civil servants insured under special schemes84 are now included in its scope.85 No common definition of ‘civil servant’ has been included in the 80

S Van Raepenbusch, above n 12, at 71. Case 300/84 Van Roosmalen [1986] ECR 3097, para 20. In the same case, the Court also held that if a person is affiliated to the social security system of a Member State, it is of no importance that s/he pursued her/his activities wholly or partly outside the territory of the Member States of the Community. See also Joined Cases 82/86 and 103/86 Laborero and Sabato [1987] ECR 3401. 82 However, not all the rules of Reg 1408/71 apply to civil servants in the same way as they do to other categories covered by the Regulation. Derogation from some fundamental principles of co-ordination, in particular the principles concerning aggregation and the determination of applicable legislation, is envisaged in Reg 1606/98. Civil servants are permitted in certain circumstances to be subject to the legislation of more than one Member State. As explained in the preamble, the derogation is owed to the need to ‘take into account the unique characteristics of these special schemes’. See also Cases C-227/94 Olivieri-Coenen [1995] ECR I-3301; C-360/97 Nijhuis [1999] ECR I-1919. 83 [1998] OJ L209/1. 84 The meaning of ‘special scheme for civil servants’ was clarified in the inserted provision 1(ja): ‘‘special scheme for civil servants’ means any social security scheme which is different from the general social security scheme applicable to employed persons in the Member States concerned and to which all, or certain categories of, civil servants or persons treated as such are directly subject.’ 85 Article 1(a)(ii) as amended This development, as also stated in the preamble to Reg 1606/98, was largely based on the Court’s decision in the Vougioukas case (Case C-443/93 [1995] ECR I-4033). The case referred to a Greek doctor who, after having worked for some years in public hospitals in Germany, was employed as a doctor in the public sector in Greece. The rules of the Greek special social security scheme, to which he was subject, allowed periods of medical practice other than periods of employment also to be taken into account for the purpose of acquiring pension entitlement. When Mr Vougioukas applied for a retirement pension in Greece, he asked for his periods of service as a doctor in German public hospitals to be recognised as pensionable service. The competent Greek authority rejected his application on the ground that his service abroad fell outside the categories of service that were expressly recognised by the provisions of the national special scheme, which was applicable in the case. The question was whether he could be covered by the co-ordination system. The Court recognised that as he was subject to a special scheme for civil servants, Mr Vougioukas was excluded from Reg 1408/71 and the system of co-ordination established by it. However, it found that the exclusion of such special schemes was a severe lacuna in the Community system, and that this exclusion was in breach of the objectives of Articles 48–51 and amounted to an obstacle to free movement. Thus, it judged the case directly on the basis of Art 42 (originally Art 51) of the Treaty. The final outcome was recognition of the periods of practice completed in Germany. At the same time, the Court pointed out to the Council that by not 81

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160 Work Interruptions and the Personal Scope of the Co-ordination Regulations Regulation, and therefore such a definition remains a matter falling within the competence of the Member States.86 People occupied in rural work are also covered by Reg 1408/71 pursuant to Art 1(a)(iii).87 b. Lack of Economic Activity The second consequence of establishing the criterion of social security as the decisive criterion for determining the personal scope of Reg 1408/71 has been the elimination of the importance of active pursuit of an economic activity. That emerged from a series of cases concerning both definite termination of economic activity and temporary interruption. Regulation 1408/71 thus applies to people who have definitely terminated their professional activity, such as pensioners.88 In the Laborero and Sabato cases,89 the Court pointed out that the status of worker is a matter which must be determined in relation to the period in which the insured person participated in the social security scheme in question. There are benefits such as survivors’ pensions, which cannot, by their nature, be awarded until after the cessation of the activity conferring entitlement to the benefit.90 Recipients of an early retirement pension91 are also ‘employed’ persons within the meaning of Art 1(a) of Reg 1408/71, and they fall within the scope of people covered by the Regulation, as described in Article 2 thereof.92 Early retirement introducing any measure for co-ordination in the public sector, it has not fully discharged its obligation under Art 42 of the Treaty. Following this judgment, Reg 1408/71 was extended to cover persons who are insured compulsorily or on an optional continued basis by special schemes for civil servants. For a comment on the case see P Mavridis,‘L’arrêt Vougioukas: une révolution discrète?’ [1998] Cahiers de Droit Européen 191. 86 Professional soldiers on active service in a Member State are regarded, however, as civil servants covered by Reg 1408/71 (Case C-71/93 Van Poucke [1994] ECR I-1101). 87 On the social security protection of farmers in Europe see H Jilke, ‘The Farmer and his Social Protection in Europe’ in D Pieters (ed), above n 79. 88 Case 182/78 Pierik [1979] ECR 1977. The case concerned the refusal of the competent Netherlands social security institution to refund to a worker of Dutch nationality, residing in the Netherlands and entitled to invalidity benefit pursuant to Netherlands legislation, the costs incurred in receiving a course of hydrotherapy in Germany (see the first Pierik case, Case 117/77 [1978] ECR 825). The question raised was whether the concept of worker in Reg 1408/71 related solely to active workers. The Court held that the definition of the concept of ‘worker’ in Art 1(a) of Reg 1408/71 for the purposes of the application of the Regulation is of general scope, and in light of that consideration covers any person who has the capacity of a person insured under the social security legislation of one or more Member States, whether or not s/he pursues a professional or trade activity. It follows that, even if they do not pursue a professional or trade activity, pensioners entitled to draw pensions under the legislation of one or more Member States come within the provisions of the Regulation concerning workers by virtue of their insurance under a social security scheme, unless they are subject to special provisions that have been laid down. 89 Joined Cases 82/86 and 103/86 [1987] ECR 3401. 90 Paragraph 19 of the judgment. See also Cases 115/77 Laumann [1978] ECR 805; 69/79 JordensVosters [1980] ECR 75. Retired civil servants are also covered by the Regulation for the same reasons as retired workers in general (Case C-194/96 Kulzer [1998] ECR I-895, para 26). 91 Early retirement schemes were introduced within the context of the Member States’ employment policies, against the background of the economic crisis at the end of the 1970s. They seek to assist workers approaching pensionable age to relinquish their jobs in favour of younger persons (see Cases 171/82 Valentini [1983] ECR 2157, para 17; C-25/95 Otte [1996] ECR I-3745, in particular paras 31–33). 92 Cases C-57/90 Commission v French Republic [1992] ECR I-0075, para 11; C-245/88 Daalmeijer [1991] ECR I-555, referring in particular to early retired civil servants, para 11. See also the Opinion of the Advocate General in Case C-198/90 Commission v Netherlands [1991] ECR I-5799, para 8. The Commission had submitted to the Council a proposal for the extension of the Regulation for the

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The Persons Covered by the Co-ordination System 161 benefits are distinct from both old age benefits and unemployment benefits. The Court pointed out that although early retirement benefits are to some extent similar to old age benefits, they are clearly different. Their similarity concerns their purpose and object, which is to guarantee the means of subsistence of people who have reached a certain age. They are different, however, in respect of the basis on which they are calculated and the conditions for their grant, as well as their objective.93 Attention will now be paid to the application of Reg 1408/71 to people temporarily interrupting work, which is of particular significance for this book. c. Temporary Interruption of Work and Application of Reg 1408/71 The Unger case94 concerned the temporary interruption of work. In subsequent cases, the Court confirmed the application of Reg 1408/71 to persons temporarily interrupting work. [I]t follows from certain provisions of Regulation No 1408/71 that it applies to certain categories of persons who, when the contingency occurs, do not have the status of ‘employed persons’ within the meaning of the law of employment. It would be contrary to the spirit of those provisions and to one of the essential objectives of the Regulation, which is to guarantee to workers who move within the Community their accrued rights and advantages, to exclude from the scope of the Regulation by giving a restrictive interpretation of the term ‘worker’.95

This line of interpretation was followed consistently in subsequent cases. A particularly important case was Martinez Sala, in which, for the first time, the enjoyment of social rights was associated with the status of the European Union citizen rather than the economic objectives of the Community. The Martinez Sala case96 This case referred to a Spanish national born in 1956, who had lived in Germany since 1968. She had various jobs in Germany at intervals between 1976 and 1986 and was in employment again from 12 September 1989 to 24 October 1989.After that, she received social assistance under the German Federal Social Welfare Law. Until 1984, she obtained from the various competent authorities residence permits which ran more or less without interruption. Thereafter, she obtained only documents certifying that the extension of her residence permit had benefit of beneficiaries of pre-retirement benefits (COM (95) 735 final). This proposal has however practically lost its importance after the adoption of Reg 883/04, explicitly referring to pre-retirement benefits. 93 The terms ‘early retirement benefits’ and ‘pre-retirement’ are often used indiscriminately to describe the same kind of benefits. Christensen and Malmstedt point out that in all Member States, there are benefits for the elderly long-term unemployed to cover the period between actual retirement from employment and reaching pensionable age, but in some Member States they are designated as early retirement pensions while in others they are called pre-retirement benefits (A Christensen and M Malmstedt,‘Lex Loci Laboris versus Lex Loci Domicilii—An Inquiry into the Normative Foundations of European Social Security law’ (2000) 2 European Journal of Social Security 69, at 88). For a general discussion of early retirement, see R Williamson et al, Early Retirement: Promises and Pitfalls (New York, Plenum Press, 1992). 94 [1964] ECR 117. 95 Case 143/79 Walsh [1980] ECR 1639, para 6. See also Case 17/76 Brack [1976] ECR 1429. 96 Case C-85/96 [1998] ECR I-2691.

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162 Work Interruptions and the Personal Scope of the Co-ordination Regulations been applied for. A residence permit expiring on 18 April 1995 was issued to Ms Martinez Sala on 19 April 1994, and this permit was extended for a further year on 20 April 1995. In January 1993, that is to say during the period in which she did not have a residence permit, she applied for child-raising allowance for her child born during that month. Her application was rejected on the ground that she did not have German nationality, a residence entitlement or a residence permit. The question raised was whether she could benefit from Community law. In particular, one of the questions submitted by the national court to the Court of Justice was whether she could be regarded as an employed person within the meaning of Art 2 in conjunction with Art 1 of Reg 1408/71. The Court, making reference to its previous case law, in particular the Pierik II and the Laborero and Sabato cases, pointed out that the existence of an employment relationship was not necessary for the inclusion of a person within the personal scope of Reg 1408/71. The Court held that the question of her status as employed person within the meaning of Reg 1408/71 should be determined solely on the basis of Art 1(a)(ii) of that Regulation. She would, therefore, be able to enjoy the rights attaching to that status once it was established that she was covered, even if only in respect of a single risk, compulsorily or on an optional basis, by a general or special social security scheme mentioned in Art 1(a) of the Regulation. It was for the national court to gather and estimate all the circumstances relevant to the case in order to establish her status as employed person. The Court, however, acknowledged her rights as being based directly on the EC Treaty. Ms Martinez was granted the right to remain a resident in Germany and be awarded a child-raising allowance there on the ground of her status as a European citizen. The case has been viewed as heralding a new era in which social security rights can be based directly on European citizenship.97 Before concluding this sub-section, it must be added that Reg 1408/71 covers not only people terminating or interrupting work; it also covers those who may never have joined the labour market, namely students.98

2. The Personal Scope of Reg 883/04 The personal scope of Reg 883/0499 is determined in Art 2. According to this article, Reg 883/04 is to apply to nationals of a Member State (as well as to stateless persons 97 A Christensen and M Malmstedt, above n 93, at 100–1. See also C Jacqueson, ‘Union Citizenship and the Court of Justice: Something New Under the Sun? Towards Social Citizenship’ (2002) 27 EL Rev 160; R White, above n 12, at 138; C Tomuschat, Commentary on the Martinez Sala Case (2000) 37 CML Rev 449. 98 Regulation 1408/71 was amended to that point by Reg 307/99 ([1999] OJ L38/1). ‘Student’ is defined as ‘any person other than an employed or self-employed person or a member of his family or survivor within the meaning of this Regulation who studies or receives vocational training leading to a qualification officially recognised by the authorities of a Member State, and is insured under a general social security scheme or a special social security scheme applicable to students’ (Art 1(ca) of Reg 1408/71 after the amendment). 99 [2004] OJ L200/1.

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The Persons Covered by the Co-ordination System 163 or refugees) residing in a Member State who are or have been subject to the legislation of one or more Member States, as well as to members of their families and to their survivors. The term ‘employed or self-employed persons’, which was used in Reg 1408/71 to signify the first major category of people covered by the co-ordination Regulation, is now omitted. In the preamble to the new Regulation, it is explained that it was found preferable to set out the personal scope of the Regulation in this way due to the major differences that exist between national legislation in terms of the people covered.100 The only decisive criterion for the application of Reg 883/04 is now that a person is or has been subject to the legislation of one or more Member States, as it is clearly stated in the Regulation.‘Legislation’ means, in respect of each Member State, laws, regulations and other statutory provisions and all other implementing measures relating to social security branches covered by Art 3(1).101 In other words, affiliation to a social security scheme is the important factor for the application of Reg 883/04. The social security criterion is, however, the decisive criterion even for the application of Reg 1408/71, as shown above in sub-section a. The question thus raised here is whether it is exactly the same criterion or concept of social security that is employed in the new Regulation as with respect to Reg 1408/71. In order to analyse the criterion or concept of social security within the framework of Reg 1408/71, three parameters were examined: First, the social risks, ie branches of social security systems, to which social security has to be related. Second, the characteristics of the national social security schemes to which Art 1(a) of Reg 1408/71 refers. And finally, the nature of the affiliation to the social security scheme demanded. The same parameters have also to be examined in respect of the criterion of social security established by Reg 883/04. 2.1 The Branches of Social Security Article 3 of Reg 883/04 stipulates that the Regulation is to apply to all legislation concerning the following branches of social security: (a) (b) (c) (d) (e) (f) 100

sickness benefits; maternity and equivalent paternity benefits; invalidity benefits; old-age benefits; survivors’ benefits; benefits in respect of accidents at work and occupational diseases;

See preamble to Reg 883/04, p (7). See Art 1(l) of Reg 883/04. Pursuant to the same provision, this term excludes contractual provisions other than those which serve to implement an insurance obligation arising from laws and regulations or which have been the subject of a decision by the public authorities which makes them obligatory or extends their scope. The Member State concerned must make a declaration to that effect, notified to the President of the European Parliament and the President of the Council of the European Union. 101

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164 Work Interruptions and the Personal Scope of the Co-ordination Regulations (g) (h) (i) (j)

death grants; unemployment benefits; pre-retirement benefits; family benefits.

The list of social security risks or benefits included in Reg 883/04 has changed somewhat since Reg 1408/71. Maternity benefits are counted separately from sickness benefits, meaning that the risk of maternity is seen as a discrete social security risk. For the first time, paternity benefits are mentioned as a special sort of benefit equivalent to maternity benefits.102 Furthermore, one new branch of social security was added, namely pre-retirement benefits. Pre-retirement benefit means all cash benefits, other than an unemployment benefit or an early old-age benefit, provided from a specified age to workers who have reduced, ceased or suspended their remunerative activities until the age at which they qualify for an old-age pension or an early retirement pension, the receipt of which is not conditional upon the person concerned being available to the employment services of the competent state.103 For the most part, however, the list corresponds to the list of Reg 1408/71 and contains the internationally recognised social security risks.104 Within the framework of the process for adopting Reg 883/04, the question of whether or not the list of risks should be exhaustive was one of the issues under discussion. It was finally decided that the list should be exhaustive, ‘for reasons of legal certainty’.105 The case law developed under Reg 1408/71, according to which affiliation to a social security scheme against only one risk is sufficient to bring a person within the scope of the co-ordination system, must be considered relevant even with regard to the new Regulation. The same must be accepted with regard to the case law, which states that the objective of the scheme is not relevant106 2.2 Characteristics of the National Schemes Pursuant to Art 3(2), the new Regulation is to apply to general and special social security schemes, whether contributory or non-contributory, as well as to schemes relating to the obligations of an employer or shipowner, unless otherwise provided for in Annex XI.107 Pursuant to Art 3(3), this Regulation is also to apply to the special non-contributory cash benefits covered by Article 70. Article 70 applies to 102

After proposal of the European Parliament (COM (04) 44 final) The term is to be distinguished from the term ‘early old-age benefit’, which means a benefit provided before the normal pension entitlement age is reached and which either continues to be provided once the said age is reached or is replaced by another old-age benefit; see Art 1(x) of Reg 883/04. 104 See also F Pennings, ‘Inclusion and Exclusion of Persons and Benefits in the New Co-ordination Regulation’ in E Spaventa and M Dougan (eds), Social Welfare and EU Law (Oxford, Hart Publishing, 2005), at 247. 105 COM (04) 44 final. 106 Above, sub-section i. 107 The content of the Annex has not yet been determined. A proposal including the determination of the content of Annex XI is currently pending; see COM (2006) 0007 final. 103

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The Persons Covered by the Co-ordination System 165 special non-contributory cash benefits which are provided under legislation which, because of its personal scope, objectives and/or conditions for entitlement, has characteristics both of the social security legislation referred to in Article 3(1) and of social assistance. As is clarified in Art 70(2), ‘special non-contributory cash benefits’means benefits which are intended to provide supplementary, substitute or ancillary coverage against the risks covered by the branches of social security referred to in Art 3(1) and which guarantee to the people concerned a minimum subsistence income, having regard to the economic and social situation in the Member State concerned; or solely specific protection for the disabled, closely linked to the said person’s social environment in the Member State concerned. The financing of the benefits, according to the same provision, derives exclusively from compulsory taxation intended to cover general public expenditures and the conditions for granting and calculating the benefits are not dependent on any contribution in respect of the beneficiary. Finally, the benefits are listed in Annex X.108 The content of this Annex has not yet been decided upon. It is to be determined by the European Parliament and the Council in accordance with the Treaty as soon as possible and at the latest before the date of application of this Regulation as referred to in Article 91, ie from the date of entry into force of the Implementing Regulation. The Member States are to make declarations as to the scope of the Regulation according to Art 9 of the Regulation. The same line of distinction that was drawn in Reg 1408/71 is also drawn in Reg 883/04. Thus, the Regulation is not to apply to social and medical assistance or to benefit schemes for victims of war or its consequences.109 There is essentially no difference in the wording of the provisions determining the material scope of the two regulations, ie Art 3 of Reg 883/04 and Art 4 of Reg 1408/71, after the last amendment of the latter by Reg 647/2005. The difference is that Reg 883/04 does not contain restrictions similar to those in Art 1(a)(ii) of Reg 1408/71 with respect to schemes covering the entire population of a Member State.110 It is thus sufficient that a person is covered under a national scheme for all residents in order to be covered by the co-ordination according to Reg 883/04. In this sense, Reg 883/04 not only incorporates the case law developed under Reg 1408/71, it goes beyond it. The new Regulation thus disconnects completely the application of the coordination system from the pursuit of an economic activity. Social security will not have to be based on economic activity, as has been the case pursuant to Reg 1408/71. Consequently, not only people who are economically non-active at the time a risk occurs but even people who have never been economically active are to be covered by Reg 883/04, provided that they are covered by a national social security scheme. 108

As to the concept of non-contributory benefits and the problems connected to them within the framework of Reg 883/04, see F Pennings, above n 104, at 251–3. 109 Regulation 883/04, Art 3(5). 110 Above, sub-section ii.

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166 Work Interruptions and the Personal Scope of the Co-ordination Regulations The employment basis of Reg 1408/71 was subject to increasing pressure after the accession to the Community of countries with universal systems.111 The amendment of Reg 1408/71 at this point and the extension of the co-ordination system to economically non-active people had been a long-standing demand supported by an overwhelming majority of legal authors, and the developments have been greeted enthusiastically. Steps had already been taken in this direction, mainly through the extension of Reg 1408/71 to students. Some remarks have to be made here, though. It is often considered that this extension means that practically all nationals of the European Union will potentially be covered by the co-ordination system, as all Member States presumably have at least health care schemes covering all residents. This is not necessarily true, however. In Germany, for instance, the self-employed, civil servants and highly paid employees are excluded from health insurance as the social security system is still constructed as a safety net for workers in a predominantly industrialised society.112 A simple review of the health care schemes of the Member States with the help of the MISSOC database shows that the majority of Member States do not have health care schemes for all residents. Apart from Germany, other Member States, such as France, Belgium and Spain have schemes covering only economically active people and their dependants. On the other hand, Member States such as the United Kingdom, Denmark and Sweden have schemes covering all residents. The assumption of the common existence of universal health care schemes in all Member States is further challenged by the experiece of the Eastern European countries that recently joined the Union. In reforming their systems, these states have shifted towards a decentralised and contracted model of social health insurance, modelled partially on the basic features of the Bismarck model.113 As was noted above, universal coverage of the population in terms of access to health care is the stated aim of all European health systems. However, inadequate financing and parallel resultant ‘informal charging’ in some, mainly the new, Member States has led to the exclusion of parts of the population in some of these countries. Entitlements to health care benefits have remained universal in theory in most countries.114 Thus, reports from Poland, for instance, indicate that those who do not pay insurance contributions directly—and there are significant numbers of such people, such as the self-employed, those in small informal businesses, farmers, the unemployed, etc—are treated as ‘uninsured’.115 Although the concerns expressed hitherto refer to categories such as those just mentioned or ethnic minorities (such as the Roma, for

111

See G Lyon-Caen and A Lyon-Caen, above n 11, at 233; S Van Raepenbusch, above n 12, at 81–86. E Eichenhofer, ‘The Social Insurance in Germany: The Bismarck Model and its Challenge in the 21st Century’ in MC Kuo et al (eds), Reform and Perspectives on Social Insurance: Lessons from East and West (The Hague, Kluwer Law International, 2002), in particular at 24. 113 E Mossialos et al, ‘Health Care’ in European Commission, Social Protection in the 13 Candidate Countries: A Comparative Analysis (Luxembourg, Office for Official Publications of the European Communities, 2003) 114 Ibid, at 113–14. 115 Ibid. 112

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The Persons Covered by the Co-ordination System 167 instance), the gender implications of exclusion from complete access to health care due to inability to pay contributions are obvious. Thus, the distinction between employment-based and residence-based systems seems to persist even with regard to the most extended schemes, namely health care schemes. Consequently, although the extension of the personal scope of the coordination system means that economically non-active people can now be covered by it, it does not necessarily mean that all economically non-active people will be covered by it. That depends on the systems of the Member States and ultimately on the national legislator. Thus, Reg 883/04 appears to have the same shortcomings as Reg 1408/71, its predecessor. Due to the great disparities that occur in the different social security systems, some people may avail themselves of Community law while others, in identical circumstances, may not.116 On the other hand, cases like Martinez Sala open the way to all nationals of the Union to acquire social security rights based directly on their status as European citizens. However, an analysis of the bases, potentialities and limits of case law referring to European citizenship, as well as its impact on the social security field, is not made here. That would demand space that cannot be provided within the framework of this book without risking its focus. Such analysis is therefore left outside the scope of this work. 2.3 The Nature of the Affiliation to a National Scheme Regulation 883/04 contains no provisions concerning the kinds of affiliation to a social security scheme that are demanded, similar to Art 1(a) of Reg 1408/71. No mention is made of terms like ‘compulsory’, ‘voluntary’ or ‘optionally continued insurance’. According to the new Regulation, it is sufficient that a person is or has been subject to the legislation of a Member State, and the nature of the affiliation to a national scheme is of no importance. The nature of the affiliation as compulsory, voluntary or optionally continued first becomes relevant within the framework of the choice of law system.117 The possibility of not being covered at all by any social security system cannot, however, be totally excluded, despite the extension of the material scope of the coordination system. As already mentioned, the comparative tables on the national social security schemes available through the MISSOC database do not confirm the view that there are any schemes compulsorily covering all residents individually in each Member State. One question that can be raised is whether the case law concerning uninsured people is relevant under the new Regulation. There is no reason to suggest that this is not the case, although questions arise as to the limits of this case law.118 Another question is whether the case law according to which social security rights can be 116

See D O’Keefe, above n 10, at 111. For a discussion of the importance and practical effects of the extension of the personal scope of Reg 883/04, see F Pennings, above n 104, at 244. 117 See Art 14 of Reg 883/04, and below II, at 2. 118 Above, at 1.1 b.

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168 Work Interruptions and the Personal Scope of the Co-ordination Regulations awarded on the basis of European citizenship, is good with regard to uninsured people. However, as already noted, this issue is outside the scope of the book. 2.4 The Conditions of Movement and Nationality Contrary to Reg 1408/71, Reg 883/04 makes no mention at all of the condition of movement. Thus, while Reg 1408/71 refers, according to its title, to the application of social security schemes to employed persons, to self-employed persons and to members of their families moving within the Community, Reg 883/04 simply refers to the co-ordination of social security systems. The development of the case law under Reg 1408/71 had already shown, however, that migration was not a necessary precondition for the application of that Regulation.119 Nevertheless, the very notion of co-ordination employed in the new Regulation presupposes some interstate element and means that the situation at issue cannot be purely internal. As to the condition of nationality, Reg 883/04 applies, like Reg 1408/71, to nationals of the Member States. In its original version, the proposal stipulated that the Regulation should apply to persons who were or had been subject to the social security legislation of one or more Member States. Against the background of the adoption of Reg 859/03 covering third country nationals, however, the European Parliament suggested, and the Commission accepted, that Art 1 of the amended Regulation be confined to nationals of a Member State. The non-inclusion of third country nationals in the personal scope of Reg 883/04 has already been subject to criticism, however. It is pointed out that third-country nationals are more likely to be discriminated against on grounds of nationality than Union citizens due to the fact that Reg 859/03 applies only in purely internal situations.Although Reg 883/04 is subject to the same limitation too, it is found that the effects of this limitation are more harmful for third country nationals, and that these harmful effects could be avoided to a considerable degree if Reg 883/04 were extended to third country nationals.120 3. Work Interruptions and the Application of the Co-ordination System In this sub-section an attempt is made to answer the first of the questions posed at the beginning of this chapter, namely whether people interrupting work because of childbirth/child-rearing or migration are covered by Reg 1408/71 and Reg 883/04. 3.1 Work Interruption because of Childbirth/Child-rearing Its has been shown that the question whether a person interrupting work because of childbirth/child-rearing is covered by Reg 1408/71 was answered quite clearly by the Court of Justice in the very early days of the social security law of co-ordination. 119 120

Above, at 1.2. F Pennings, above n 104, at 245.

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The Persons Covered by the Co-ordination System 169 Subsequent developments entailing elimination in general of the importance of active pursuit of an economic activity at the time of the occurrence of a social security risk only strengthens this standpoint. The nature of the economic activity pursued before the work interruption is also quite irrelevant. Regulation 1408/71 today embraces several categories of economically active people beyond the scope of typical employees. On the contrary, what is important is that the person concerned fulfils the criterion of social security. It means that s/he has to be covered by a social security scheme in a Member State in order to be covered by Reg 1408/71. The social security at issue must be based on economic activity according to Reg 1408/71, which means that the person concerned must at some point in her/his life have entered the labour market. Regulation 883/04 changes this state of law in the sense that it makes the coordination system applicable even to people who have never entered the labour market, provided that they are covered by a social security scheme in a Member State. This change does not, however, have any major significance for the people examined here, namely people interrupting work because of childbirth/childrearing. Such people have joined the labour market and have, presumably, social security coverage based on economic activity. The people (women) for whom the new state of law is mostly beneficial are probably child carers who have never entered the labour market. These people can now be covered by the co-ordination system, provided they fulfil the social security criterion. On the other hand, economically active people who are not covered by a social security scheme will remain outside the scope of Reg 1408/71 and Reg 883/04. The Mouthaan precedent might possibly offer a ground for their coverage by Reg 1408/71. Nevertheless, it is unlikely whether this precedent was intended to cover the (entire) informal sector of economy where many women are employed. Thus, non-insured economically active people—women—interrupting work because of childbirth/child-rearing are very likely to fall outside the personal scope of Reg 1408/71, and Reg 883/04 unless covered by a residence-based scheme. This state of the law ought to be most detrimental to women in Member States with an extensive informal economic sector and employment-based systems, most notably the southern Member States. 3.2 Work Interruption because of Migration It has been shown that the question of whether people interrupting work because of migration are covered by Reg 1408/71 has not been answered explicitly. One can, however, conclude with a fair degree of certainty that this is the case, provided of course that the person concerned is covered by a social security scheme in a Member State. The nature of the economic activity pursued before the interruption is of no importance. According to Reg 883/04, the person concerned will be covered by the co-ordination provided s/he fulfils the social security criterion, even if s/he never pursued an economic activity.

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170 Work Interruptions and the Personal Scope of the Co-ordination Regulations

II. THE CHOICE OF LAW SYSTEM

This section focuses on the second question posed at the beginning of the chapter, namely whether people interrupting work because of childbirth/child-rearing or migration are covered by the choice of law provisions of Reg 1408/71 and Reg 883/04. The choice of law rules are included in Articles 13–17a of Reg 1408/71 and Articles 11–16 of Reg 883/04, and constitute Title II of both Regulations. The entire system of choice of law is based on two fundamental principles of coordination: the principle of one applicable legislation; and the principle of application of the legislation of the Member State of employment—the lex loci laboris principle. Therefore, the question of whether people interrupting work due to childbirth/child-rearing responsibilities or migration are covered by the provisions of Title II can be reformulated as follows: do the co-ordination principles of the application of the legislation of a single Member State and of the application of the legislation of the Member State of employment (lex loci laboris principle) apply to people interrupting work due to childbirth/child-rearing and migration? In other words, do these two fundamental co-ordination principles apply in cases of work interruption due to childbirth/child-rearing and migration? The meaning and the content of these two principles are briefly examined before attention is focused on the people covered by the pertinent provisions. Particular attention is given to the question of whether these provisions apply to people interrupting work in general. At the end of this section, the focus is on people interrupting work for the particular purpose of childbirth/child-rearing and migration. The question of the application of the principles of single applicable legislation and lex loci laboris is answered on the basis of the material presented. 1. The Provisions of Reg 1408/71 In this sub-section, the focus is on the provisions of Reg 1408/71 as well as on the case law concerning these provisions.As will be seen, apart from the main principles of one applicable legislation and lex loci laboris, a further principle was developed in the case law—the principle of application of the lex loci domicilii—which was later incorporated into the text of the Regulation. 1.1 The Main Principles of the Choice of Law System: One Applicable Legislation and Lex Loci Laboris The main purpose of the choice of law provisions is to avoid the occurrence of a positive or negative conflict of laws. Conflict of laws is very likely to occur in a migration context, where different national systems with different principles and requirements may be involved.121 To this end, two fundamental principles are 121 For the meaning of the concepts ‘positive’ and ‘negative’ conflict of laws, see R Cornelissen, ‘Posting within the European Community and Social Security: The Legal Framework’ and P Donders,

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The Choice of Law System 171 established: the principle of application of the legislation of a single Member State, and the principle of application of the legislation of the Member State of employment (the lex loci laboris principle). Before focusing on the issue of application of these principles to people interrupting work, their content is briefly outlined. There is rich case law concerning this issue. The discussion, however, is confined to certain main issues. a. The Principle of One Applicable Legislation The general principle underlying the provisions of Reg 1408/71 on choice of law is that the worker is to be subject only to the legislation of one single Member State, also called the integration principle,122 or the single state rule.123 As the Court has emphasised many times, the provisions of Title II constitute a complete and uniform system of conflict rules, the aim of which is to ensure that the people concerned are to be subject to the social security system of only one Member State, in order to prevent the complications that may result from the application of more than one national legislation.124 Such complications could mean, for instance, that a migrant is compelled to pay social security contributions in more than one Member State. That could undermine the entire purpose of the Community’s legislation on social security, which is to facilitate the free movement of workers.125 The Court pointed out that it is in fact in the interests of workers, employers, and insurance funds to avoid any plurality or purposeless confusion of contributions and liabilities, which would result from the simultaneous or alternate application of several legislative systems.126 i. Exceptions to the Principle of One Applicable Legislation Regulation 1408/71 contains exceptions to the principle of application of a single legislation. There are instances where a person who is employed in one Member State and self-employed in another is simultaneously subject to the legislation of two Member States.127 ‘Temporary Employment Across Borders. Posting in Accordance with Regulation 1408/71 in Practice’ in Social Security Institute of Greece (IKA) and the European Commission (eds), The Free Movement of Workers within the European Union: Posting and the perspectives of Community co-ordination in the context of Regulation 1408/71, Conference Report (Crete, 1995), at 30 and 109, respectively. 122 See F Pennings, above n 28, at 70. 123 A Christensen and M Malmstedt, above n 93, at 77. 124 Cases 276/81 Kuijpers [1982] ECR 3013; 101/83 Brusse [1984] ECR 2223; 60/85 Luijten [1986] ECR 2365; C-2/89 Kits Van Heijningen [1990] ECR I-1755; C-71/93 Van Poucke [1994] ECR I-1101; C425/93 Calle Grenzshop [1995] ECR I-269; C-131/95 Huijbrechts [1997] ECR I-1409; C-275/96 Kuusijärvi [1998] ECR I-3419; C-202/97 Fitzwilliam [2000] ECR I-883. The preceding Reg 3/58 did not however contain any provision prohibiting the simultaneous application of more than one piece of legislation. See Case 92/63 Nonnenmacher [1964] ECR 0281; see also R White, above n 12, at 60 et seq. 125 Case 102/76 Perenboom [1977] ECR 815. See also Case C-140/88 Noij [1991] ECR I-387. 126 Case 19/67 Van der Vecht [1967] ECR 345. 127 Art 14c(b) of Reg 1408/71 in conjunction with Annex VII. See also Case C-340/94 de Jaeck [1997] ECR I-461. Member States have clarified in Annex VII which branches of social security or under which conditions this exception applies to. Thus, for example, a person who is self-employed in Belgium and gainfully employed in any other Member State, except Luxembourg, is simultaneously subject to the legislation of both of the Member States concerned (point I in Annex VII (A) of Reg 1408/71. See also Cases 24/88 Michel Georges [1989] ECR 1905; Joined Cases C-393/99 and C-394/99 Hervein and Hervillier, Lorthiois and Comtexbel [2002] ECR I-2829; C-493/04 Piatkowski [2006] ECR I-2369). Generally, it can be said that the exception may apply only with regard to specific branches or schemes of social security, as is the case for Germany and Greece (respectively, the German agricultural accident

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172 Work Interruptions and the Personal Scope of the Co-ordination Regulations When a person is employed in the territory of two or more Member States and/or self-employed in the territory of two or more Member States, the choice of law rules are to be applied with respect to the Member State of employment, as well as with respect to the Member State of self-employment. Another exception is introduced by Art 15 of Reg 1408/71. The article refers to voluntary or optional continued insurance. Pursuant to it, Articles 13 to 14d (concerning, in general, the single applicable legislation and lex loci laboris principles) are not to apply to voluntary insurance or to optional insurance, unless only a voluntary scheme of insurance in respect of one of the branches referred to in Art 4 of Reg 1408/71 exists in any Member State. Any application of the legislation of several Member States should not, though, entail overlapping of insurance. The principle of application of the legislation of a single Member State does not apply to people not covered by the provisions of Title II in general.128 Thus, such people can be subject to the legislation of more than one Member State. However, the choice of law rules do exempt such people, more specifically pensioners, from being required to pay in the country of residence contributions for compulsory insurance to cover benefits payable by an institution of another Member State.129 The appropriateness of the one applicable legislation principle has been a matter of discussion. Pieters advocates maintaining and strengthening the principle, yet he is of the opinion that this does not exclude the possibility of simultaneous applicability of the social security schemes of more than one Member State. This is perfectly in line, he argues, with the principle of one and only one competent state, as far as distinct social security schemes are concerned. This has been the case ever since the introduction of a separate set of designation rules for ‘special noncontributory benefits’. Today, it is perfectly possible that one and the same person simultaneously receives benefits under one national social security system (in the country s/he works in, for example) and other, special non-contributory benefits, under the law of the Member State s/he lives in.130 b. The Lex Loci Laboris Principle As a general rule, the applicable legislation is the legislation of the Member State of employment, the lex loci laboris. Thus, if the insurance scheme and the old age insurance scheme for farmers and the Greek pension insurance scheme for self-employed persons, points 2 and 7 of Annex VII) or under the condition of residence in the national territory of the Member State that accepts the double affiliation, as is the case in Denmark and Spain (points 2 and 4 of Annex VII).A Member State can also apply this exception in relation to some branches of economic activity in some Member States, but not in relation to other Member States (see points 5 and 6 of Annex VII referring to Luxembourg and France). 128 Below, at 1.2 b. 129 Case C-57/90 Commission v France [1992] ECR I-75. Furthermore, Art 17a establishes that the recipient of a pension due under the legislation of a Member State or of pensions due under the legislation of several Member States who resides in the territory of another Member State, may upon request be exempted from the legislation of the latter State provided that s/he is not subject to that legislation because of the pursuit of an occupation (Case C-140/88 Noij [1991] ECR I-387. In the preamble to the amending Regulation 2195/91 ([1991] OJ L206/2) the branches of social security from which a pensioner can be exempted are listed as sickness insurance, maternity and family benefits, while such specification is omitted in the wording of Art 17a itself). 130 D Pieters,‘Towards a Radical Simplification of Social Security Co-ordination’ in Swedish National Social Insurance Board and European Commission (eds), above n 10, at 174.

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The Choice of Law System 173 person concerned is subject both to the legislation of her/his country of residence and to the legislation of her/his country of employment, the latter takes precedence. The principle is applied in many different situations and Title II contains specific rules concerning these. The lex loci laboris principle has been subject to increasing pressure. This pressure is attributed to changes in the labour market, as well as to the erosion of the principle by exceptions established in Reg 1408/71 itself, in particular Art 17.131 Changes in the labour market mean new situations, such as brief working periods in another Member State, or distance-work. Thus, the principle has been scrutinised by a considerable number of legal authors. Pieters, for instance, has argued for changing the principle in relation to some benefits, but keeping it in relation to others. He has proposed the division of social security benefits into income replacement benefits, on the one hand, and cost compensating benefits, on the other. Schemes dealing with income replacement would continue to be co-ordinated as they are today, that is to say mainly on the basis of the lex loci laboris principle, whereas those dealing with cost compensating would be co-ordinated on the basis of the principle of application of the legislation of the Member State of residence, the lex loci domicilii. This distinction would apply to all benefits, both in cash and in kind.132 Christensen and Malmstedt have argued that the lex loci laboris rule is not merely a technical rule. It is a principle implying that work and contributions constitute the moral and financial foundations of social security.133 They have also advocated for the application of both lex loci laboris and lex loci domicilii. According to them, the line for applying the one or the other should be drawn with respect to the normative character of the benefit. In their view, the normative base for social security benefits in national systems is either employment and contributions, or solidarity within a national community. Consequently, the decision for applying either lex loci laboris or lex loci domicilii should reflect how the benefit is constructed in the national legislation, the conditions for entitlement, the method by which the amount of benefit is calculated, the social aim of the benefit, whether it is means tested or not, and whether there is a close link between the benefit and the social and economic conditions in the country.134 Sakslin is also a proponent for the application of the principle of the country of residence in parallel with the principle of employment.135 Numhauser-Henning argues that the success of the lex loci laboris principle depends on the specific category of migrant workers to whom it is applied.136 The content of the lex loci laboris principle and its exceptions will now be briefly outlined. 131

Below, at iii. D Pieters, above n 130, at 174 et seq. 133 A Christensen and M Malmstedt, above n 93, at 76. 134 Ibid, at 103. 135 M Sakslin, ‘Social Security Co-ordination—Adapting to Change’ (2000) 2 European Journal of Social Security 169, at 218. 136 A Numhauser-Henning, ‘Freedom of Movement and Transfer of Social Security Rights’, paper presented at the VII European Regional Congress of the International Society for Labour Law and Social Security in Stockholm, 4–6 September 2002, in Congress Sekretariat, Labour Law Congress 2002: Reports. 132

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174 Work Interruptions and the Personal Scope of the Co-ordination Regulations i. When a Worker Pursues Her/His Activity in One Member State and Resides in Another The principle of application of the lex loci laboris finds its purest formulation in Art 13(2)(a) of Reg 1408/71. This article states that when a person is employed in the territory of one Member State and resides in another Member State, s/he is to be subject to the legislation of the Member State of employment. According to the same provision, the person concerned is to be subject to the legislation of the Member State of employment even if the registered office or place of business of the undertaking or individual employing her/him is situated in the territory of another Member State. This rule applies even where the employer is established in the country of residence of the worker who, in order to carry out her/his work, is conveyed daily by and at the expense of the employer between her/his place of residence and place of work. The worker, in this case, is subject to the law of the place of employment even during the journey to it, and, in particular, during that part of the journey which occurs in the territory of the Member State of residence.137 Since the worker is insured under the national system of the state of employment only, s/he is not liable also to pay social security contributions to the state of residence.138 A person who is employed parttime in the territory of a Member State is subject to the legislation of that state both on the days s/he pursues that activity and on the days s/he does not.139 When the worker has been successively employed in several Member States, then s/he will be subject to the legislation of the Member State in which s/he is or was last employed.140 The provisions of Title II also apply when the activities of the worker are carried out outside the Community, as long as the employment relationship retains a sufficiently close link with the Community.141 A person who is self-employed in the territory of one Member State is subject to the legislation of that state, even if s/he resides in the territory of another Member State.142 137

Case 19/67 Van der Vecht [1967] ECR 345. Case 102/76 Perenboom [1977] ECR 815. See also Cases C-34/98 Commission v France [2000] ECR I-995; and C-169/98 Commission v France [2000] ECR I-1049. 139 Case C-2/89 Kits Van Heijningen [1990] ECR I-1755. 140 Case 150/82 Coppola [1983] ECR 43. 141 Case 60/93 Aldewereld [1994] ECR I-2991. The case concerned a Netherlands national who was resident in the Netherlands when he took a job with an undertaking established in Germany. The undertaking immediately posted him to Thailand. Mr Aldewereld was liable to pay social security contributions in Germany in respect of sickness, unemployment, old age and accidents, and his employer deducted the corresponding contributions directly from his salary during the year he was employed in Thailand. In respect of the same year, the Netherlands tax authority demanded from him as a Netherlands resident mandatory contributions under Netherlands social insurance legislation, which does not require that the person concerned pursues his professional or trade activity in that state. Although no provision of Title II dealt directly with such a situation, the Court held that Community law was applicable so long as the employment relationship retained a sufficiently close link with the Community. The link was found in the fact that the Community worker was employed by an undertaking from another Member State and, for that reason, was insured under the social security scheme of that state. Since the applicable legislation was that of Germany, no contributions had to be paid in the Netherlands. 142 Regulation 1408/71, Art 13(2)(b). 138

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The Choice of Law System 175 Pensioners who are engaged in a professional activity in the territory of a Member State other than the Member State in which they reside, are subject to the legislation of the Member State of employment, even if the activity pursued is parttime and the number of working hours does not even exceed four hours per week.143 ii. When a Worker Pursues Her/His Activity or Activities in Several Member States When a person is employed in the territory of two or more Member States, two situations can be distinguished. In the first, s/he is resident in one of the Member States where s/he pursues part of her/his activity. In the second, s/he is resident in a third Member State where s/he pursues no economic activity at all. These situations are governed by Art 14(2)(b)(i) and (ii) respectively. If the person concerned is selfemployed, the situation is governed by Art 14a(2). If a person is simultaneously employed in the territory of one Member State and self-employed in the territory of another Member State, the applicable article is Art 14c.144 To start with, if the person concerned pursues part of her/his activity in the territory of the Member State in which s/he resides, s/he is to be subject to the legislation of that Member State.145 This rule applies even if the occupation in the country of residence is secondary to the main activity of the person concerned, which is pursued in the other Member State.146 This provision applies irrespective of whether the worker is attached to one or several employers, one of which is established in another Member State where the risk took place.147 If the worker does not reside in the territory of any of the Member States where s/he pursues his activity, s/he is subject to the legislation of the Member State where the registered office or place of business of the undertaking or the individual employing her/him is situated.148 Self-employed people who pursue their activity in the territory of two or more Member States are subject to the legislation of the Member State where they reside, if they pursue any part of their activity in the territory of that Member State. If they do not pursue any activity in the country of residence, they are subject to the legislation of the Member State in whose territory they pursue their main activity.149 People who are simultaneously employed in the territory of one Member State and self-employed in the territory of another Member State by virtue of one or several activities are, apart form some exceptional cases where the legislation of both Member States applies,150 subject to the legislation of the Member State in the 143

Case C-2/89 Kits Van Heijningen [1990] ECR I-1755. Furthermore, Art 14(2)(a)(i) and (ii) determines the applicable legislation for persons who are members of the travelling or flying personnel of an undertaking which, for hire or reward or on its own account, operates international transport services for passengers or goods by rail, road, air or inland waterway. 145 Regulation 1408/71, Art 14(2)(b)(i). See also Case C-425/93 Calle Grenshop [1995] ECR I-269. 146 Case 276/81 Kuijpers [1982] ECR 3013. 147 Case 73/72 Bentzinger [1973] ECR 283. 148 Regulation 1408/71, Art 14(2)(b)(ii). See also Case 60/93 Aldewereld [1994] ECR I-2991. 149 Ibid, Art 14a(2). See also Case C-249/04 Allard [ 2005] ECR I-04535 150 Above, at i. 144

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176 Work Interruptions and the Personal Scope of the Co-ordination Regulations territory in which they are engaged in paid employment.151 Such people are to be treated, for the purposes of the applicable legislation, as though they pursue all their professional activity or activities in the territory of the Member State concerned.152 Thus, a person who is simultaneously employed as a military doctor in Belgium and as a self-employed doctor in the Netherlands is to be subject, as a result of the latter activity, to the appropriate Belgian legislation under the same conditions as if s/he was self-employed in Belgium.153 Employment in several Member States must be distinguished from posting, which constitutes an exception to the lex loci laboris principle. Such a distinction can often be quite complicated. Posting and other exceptions from the lex loci laboris principle are briefly outlined in the following sub-section. iii. Exceptions to the Lex Loci Laboris Principle The main exceptions to the lex loci laboris principle refer to the posting of employees and to the possibility of Member States establishing further applicable legislation through agreements. Article 14(1)(a) of Reg 1408/71 refers to posting. Pursuant to it, when an employed person is posted by the undertaking, to which s/he is normally attached, in the territory of another Member State to perform work there for that undertaking and for a period not exceeding 12 months, s/he is to continue to be subject to the legislation of the first Member State, provided that s/he is not sent to replace another person. This rule applies even in the case of undertakings the normal business of which is to take on workers to post them to other undertakings in order to provide them with temporary, qualified personnel.155 There is also a possibility of extending the initial period of 12 months by a maximum of 12 further months for unforeseeable circumstances.155 As for the posting of self-employed workers, this is governed by Article 14a(1)(a) and (b). Few statistics exist as to the number of self-employed workers posted in the

151

Regulation 1408/71, Art 14c(a). See also Case C-493/04 Piatkowski [2006] ECR I-2369. Ibid, Art 14d(1). 153 Case C-71/93 Van Poucke [1994] ECR I-1101. 154 Case 35/70 Manpower [1970] ECR 1251. The undertaking must normally carry on its activities in the first Member State in order to be able to take advantage of the posting provision contained in Art 14(1)(a). An undertaking engaged in providing temporary personnel normally carries on its activities in the Member State in which it is established, if it habitually carries on significant activities in that State. In order to determine whether an undertaking engaged in providing temporary personnel habitually carries on significant activities in the Member State in which it is established, the competent institution of that State must examine all the criteria characterising the activities carried on by that undertaking. Such criteria may refer to the place where the undertaking has its seat and administration, the number of administrative staff working in the Member State in which it is established and in the other Member State, the place where posted workers are recruited and the place where the majority of contracts with clients are concluded, the law applicable to the employment contracts concluding by the undertaking with its workers and with its clients, and the turnover during an appropriately typical period in each Member State concerned, etc (Case C-202/97 Fitzwilliam [2000] ECR I-883). With regard to the interpretation of the posting provisions, see also Decision No 128 of 17 October 1985 of the Administrative Commission ([1986] OJ C141/6), replaced by Decision No 162 of 31 May 1996 ([1986] OJ L241/28). See also R Cornelissen, above n 121, at 34–35; P Donders, above n 121, at 128–31. 155 According to Art 14(1)(b) of Reg 1408/71. 152

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The Choice of Law System 177 Community.156 The concept may be difficult to conceive of as the question ‘who in fact posted the self-employed person?’ can be difficult to answer.157 The rules as to the applicable legislation in cases of posting are usually regarded as an exception to the lex loci laboris principle. In the opinion of some authors, however, these rules constitute lex specialis in relation to the lex loci laboris principle rather than an exception to it.158 Exactly when a situation of posting arises may be very difficult to determine. Usually, as posting is preconceived, the situation emerges when people are sent to another Member State to work there for a brief period of time or to render services, while remaining affiliated to the social security system of the sending country. However, a clear and general definition of posting is lacking.159 Thus, it might be confused with other situations.160 Problems have been raised concerning distinguishing the posting of selfemployed people161 from simultaneous employment and self-employment in several Member States.162 This problem is often connected with the fact that the same activity can be classified as self-employment in one Member State and paid employment in another.163 Besides, problems have been raised con156

P Donders, above n 121, at 136. Ibid, at 137. D Pieters,‘Europe and Posting: Some Reflections’ in Social Security Institute of Greece (IKA) and the European Commission (eds), above n 121, at 149; Numhauser-Henning calls it the lex loci laboris II principle: see A Numhauser-Henning, above n 136. 159 See D Pieters, above n 158, at 154 and 159. See, though, the definition of the term ‘posted worker’ contained in Dir 96/71/EC (OJ 1997 L18/1) concerning the posting of workers in the framework of the provision of services. For a detailed account of the meaning of the concept of posting, see R Cornelissen, above n 121, at 34–47; P Donders, above n 121. As to labour law aspects of posting, see E Eichenhofer, ‘Posting of Employed Persons and Labour Conditions’in Social Security Institute of Greece (IKA) and the European Commission (eds), above n 121. See also P Davies,‘Posted Workers: Single Market or Protection of National Labour Law Systems?’ (1997) 34 CML Rev 571. As to economic aspects of posting, see G Mangan, ‘Posting of Workers and Supplementary Pension Schemes’ and V Patsouratis, ‘Taxation and Mobility’ in Social Security Institute of Greece (IKA) and the European Commission (eds), above n 121. 160 Criteria for distinguishing the situation of posting exist in a number of decisions of the Administrative Commission for Migrant Workers, such as Decision No 181 (01/891/EC) of 13 December 2000 concerning the interpretation of Art 14(1), 14a(1) and 14b(1) and (2) of Reg 1408/71 on the legislation applicable to posted workers and self-employed workers temporarily working outside the competent state ([2001] OJ L329/73). 161 Governed by Art 14a(1)(a) of Reg 1408/71. 162 Governed by Art 14c of Reg 1408/71. 163 See Case C-178/97 Barry Banks and Others [2000] ECR I-2005. The question in the case was whether British opera singers, who were subject to the British social security system as self-employed persons, would be subject to the Belgian scheme for employed persons, while performing in Belgium, where their activity was regarded as paid employment. In that case, they would have to pay contributions to the Belgian scheme. The national court submitted the case to the Court of Justice asking for an interpretation of Art 14a(1)(a) with regard to the posting of self-employed persons (Art 14a(1)(a) applies to self-employed persons who perform ‘work’ in the territory of another Member State). The question was whether the term ‘work’ should be understood as any work, whether paid employment or self-employment. The Court ruled that the term ‘work’ in Art 14a(1)(a) of Reg 1408/71 covers any performance of work, whether in an employed or self-employed capacity. Consequently, the people concerned continued to be subject to the British legislation as self-employed posted abroad. If however Art 14c were applicable, they would be subject to the Belgian legislation and would have to pay contributions in Belgium. 157 158

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178 Work Interruptions and the Personal Scope of the Co-ordination Regulations cerning the distinction between posting164 and employment in several Member States.165 The distinction ought to be quite clear and not too complicated. The case law demonstrates, however, that it may not be so easy to make the distinction.166 Pieters considers that the rulings of the Court are not very clear as to the distinction.167 Another situation that has raised problems in terms of the application of Reg 1408/71 is posting to countries outside the Community.168 A further problem is distance-work, ie work that can be performed in another Member State with the help of modern technology without any change in the employment relationship of the person concerned. This situation is considered not to be a posting as the employee is not physically sent to the other Member State by her/his employer. The question, therefore, is whether the applicable legislation is the legislation of the Member State where the work is physically performed or of the Member State where the employee is formally employed.169 The second major exception to the lex loci laboris principle is that introduced by Art 17 of Reg 1408/71. Pursuant to it, two or more Member States, the competent authorities of these states or the bodies designated by these authorities, can decide by common agreement that the legislation of a Member State other than the state of employment is to be applicable in the interest of certain categories of person or certain particular persons.170 The motives and the circumstances for derogating 164

Governed by Art 14(1) of Reg 1408/71. Governed by Art 14(2)(b) of Reg 1408/71. Case C-425/93 Calle Grenshop [1995] ECR I-269. The case concerned an undertaking, referred to as Calle, with its seat in Germany where it operated business. The undertaking employed almost exclusively Danish workers residing in Denmark. Calle did not pay any social security contributions for its employees in Germany. When the German social security institution claimed contributions on behalf of one employee, Calle appealed against the notice of contribution on the ground that the person concerned also pursued activities in Denmark on its behalf for about 10 hours each week. Consequently, according to the view of the undertaking, the employee was exclusively subject to Danish legislation pursuant to Art 14(2)(b)(i) of Reg 1408/71. The Court held that a situation such as the one described in the case could not be regarded as a posting, since the duration of the work performed by the person concerned in Denmark exceeded 12 months. On the contrary, the person concerned fell under Art 14(2)(b)(i) as simultaneously employed in two Member States and was, consequently, subject to Danish legislation. 167 D Pieters, above n 158, at 158. 168 See Cases 9/88 Lopes da Veiga [1989] ECR 2989; C-60/93 Aldewereld [1994] ECR I-2991; C-214/94 Boukhalfa [1996] ECR I-2253; C-425/93 Calle Grenzshop [1995] ECR I-269. See also M Moore, above n 56, at 430. 169 To take a national example, the Swedish authorities demand the physical presence of the employee for the application of the national legislation of the country, according to the lex loci laboris principle (B Sibbmark, ‘Centrala koordineringsproblem under förordningens giltighetstid’ in L Westerhäll and T Erhag, Seminarium om tillämpningen av förordning (EEG) Nr 1408/71-Slutrapport (Göteborg, Handelshögskolan, 1998), at 10. See also a press release from the National Social Insurance Board (Riksförsäkringsverket), available at http://www.rfv.se/press/pm/2001/pm_01_40.htm. 170 Case 101/83 Brusse [1984] ECR 2223. The facts of the case referred to a Netherlands national who, after working in the Netherlands, had lived and worked in the United Kingdom since 1964. The legislation to which he should have been subject pursuant to the provisions of Reg 1408/71 was the legislation of the Member State of employment, ie the United Kingdom. However, he was never affiliated to the social security scheme of the United Kingdom and he continued to pay voluntary contributions to the Netherlands scheme. When the irregularity of his situation was discovered in 1977, the competent authorities of the two Member States decided, in view of the fact that the irregularity had existed for 165 166

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The Choice of Law System 179 from the lex loci laboris principle are not relevant, according to the Court. Member States enjoy a wide discretion in that respect, the only limitation being regard for the interests of the worker.171 Consequently, the question of how the interests of the worker should be understood is of great importance. Agreements concluded on the basis of Art 17 can have retroactive effect.172 Article 17 is very often invoked in posting cases. If the anticipated posting period exceeds one year, an Art 17 agreement is almost always entered into immediately.173 Agreements on the basis of Art 17 are usually concluded for postings in the service sector, and within the framework of multinational companies. They concern the posting of senior staff within companies operating trans-nationally, from a Member State with a high level of social security to a Member State with a low level of social security.174 Generally, these agreements are concluded for a period of five years. We may ask, however, whether postings for unrestricted or very long periods of time should be allowed.175 The freedom of choice of the applicable legislation, established by Art 17, undoubtedly entails a tension between freedom of movement, which is supposedly facilitated by this availability of an option, and the lex loci laboris principle. Member States appear to be divided in their view about the utility of the agreements in cases of posting.176

several years, to conclude an agreement in accordance with the provisions of Art 17 of Reg 1408/71. On the basis of that agreement, the person concerned was to be regarded as subject to the Netherlands social security scheme until 1977. From that date onwards, he should be regarded as subject to the legislation of the United Kingdom. The Court held that, where such an agreement corresponds to the interests of the worker concerned, it is possible for two Member States to derogate from the lex loci laboris principle by common agreement. 171 Case 101/83 Brusse [1984] ECR 2223, para 25. 172 Case 101/83 Brusse [1984] ECR 2223, paras 19–23. 173 P Donders, above n 121, at 122–3. He also mentions that, apart from arranging longer posting periods, Art 17 agreements are used to solve unforeseen problems, which can be dealt with by applying the normal rules. This use of Art 17, however, is rather exceptional. 174 It has been argued that, although somewhat exaggerated, blue-collar workers only qualify for Art 14(1)(a) and preferably for as short a period as possible, while white-collar workers qualify in particular for Art 17 agreements for as long as possible (P Donders, above n 121, at 138). Pieters holds the opposite view (D Pieters, above n 158, at 152–3). See also R Cornelissen, above n 121, at 33, commenting on Recommendation No 16 of 12 December 1984 ([1985] OJ C273/3). 175 Five years seems to be the accepted period in most Member States (P Donders, above n 121, at 123 and 127). The question is debated among scholars. Pieters is of the opinion that the maximum term of the long posting should not exceed two years, as long posting periods put too much pressure to the lex loci laboris principle (D Pieters, above n 158, at 157). According to Recommendation No 16 of 12 December 1984 concerning the conclusion of Agreements pursuant to Article 17 of Council Regulation (EEC) No 1408/71 ([1985] OJ C273/3), national authorities are advised to conclude agreements according to Art 17 according to which the posted person should remain subject to the legislation of the sending Member State for the full duration of their assignment, provided the people concerned agree to this condition. 176 Thus, Member States with a high level of social security protection regard the agreements based on Art 17 as conducive to freedom of movement, while Member States with a low level of social security protection regard them as erosive of the lex loci laboris principle. Some Member States even regard the agreements as leading to social dumping; see P Donders, above n 121, at 138.

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180 Work Interruptions and the Personal Scope of the Co-ordination Regulations Other exceptions from the lex loci laboris principle are contained in Art 16 of Reg 1408/71,177 as well as in the provisions of Title III.178 In these cases, social security benefits are conferred by the country of residence. In Art 13(2)(f), the lex loci domicilii is established as the applicable legislation in some cases by derogation from the lex loci laboris principle, as discussed in more detail below. 1.2 The Personal Scope of the Provisions of Title II This sub-section focuses on the personal scope of the provisions of Title II of Reg 1408/71. The question of whether the personal scope of Reg 1408/71 in general should be determined by applying the personal scope provisions of Title I or the choice of law provisions of Title II was answered by the Court to the benefit of Title I. At the same time, it was shown that all persons covered by Reg 1408/71 by virtue of Articles 2(1) and 1(a) of Title I were not covered by the provisions of Title II and the principles established there. Particularly, people not actively pursuing an economic activity were excluded from the application of the choice of law principles, although they were covered by Reg 1408/71 on the basis of Articles 2(1) and 1(a). This later led to the establishment of another principle used in determining the applicable legislation to these people, namely the lex loci domicilii. There are some interesting cases concerning ad hoc workers interrupting work due to childbirth/child-rearing responsibilities, and these will be examined in the following pages. Attention will first be given to the question of determining which people are covered by the provisions of Title II, followed by a focus on people who are not actively pursuing an economic activity and on the issue of application of the principles of Title II to them, in particular lex loci laboris. How and why these people came to be subject to another principle—the lex loci domicilii principle—will then be discussed, concluding with an assessment of the current state of the law from the perspective of people interrupting work because of childbirth/ child-rearing or migration. a. The Persons Covered by the Provisions of Title II of Reg 1408/71 and the Main Principles Established in it The de Jaeck case179 raised the question of whether Title 177 According to it, people employed by diplomatic missions and consular posts and the private domestic staff of agents of such missions or posts, who are nationals of the accrediting or sending Member State, may opt to be subject to the legislation of that State. Auxiliary staff of the European Communities may opt to be subject to the legislation of the Member State in whose territory they are employed, to the legislation of the Member State to which they were last subject, or to the legislation of the Member State whose nationals they are, in respect of provisions other than those relating to family allowances. The granting of the latter is governed by the conditions of employment applicable to such staff. 178 Such provisions include Art 71(1)(a)(ii) and (b)(ii) of Reg 1408/71 concerning unemployment benefits (see Cases 227/81 Aubin [1982] ECR 1991; 1/85 Miethe [1986] ECR 1837; 236/87 Bergemann [1988] ECR 5125; C-216/89 Reibold [1990] ECR I-4163; C-102/91 Knoch [1992] ECR I-4341; C-454/93 Van Gestel [1995) I-1707); and Art 77(2)(b)(i) concerning benefits for dependant children of pensioners (see Case 242/83 Patteri [1984] ECR 3171). 179 Case C-340/94 [1997] ECR I-461.

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The Choice of Law System 181 II applies to all persons covered by Art 2(1).180 The problem emerged as a result of the different terminology used in Articles 2(1) and 1(a), on the one hand, and the relevant provisions of Title II—ie Articles 14a and 14c—on the other.Articles 14a and 14c constitute specific expressions of the lex loci laboris principle. While Articles 2(1) and 1(a) refer to employed and self-employed persons,181 Title II in general refers to persons who are employed and persons who are self-employed.182 More specifically, Art 14a refers to persons ‘normally self-employed in the territory of a Member State and who perform work in the territory of another Member State’, while Art 14c refers to persons ‘who are simultaneously employed in the territory of one Member State and self-employed in the territory of another Member State’. The Court pointed out that the Regulation does not define what is meant by ‘persons who are employed’ and ‘persons who are self-employed’.183 Nor does it specify whether the work performed, according to Art 14a, should be paid employment or self-employment. A situation can therefore arise in which a person who normally performs work regarded as selfemployment within one Member State wishes to do the same type of work for a brief period in another Member State whose social security legislation regards such work as paid employment.184 The Court took the view, however, that the problem was to be solved not by laying down a definition of the concepts of Title II, but by interpreting them in the light of Articles 2(1) and 1(a) of Title I: [A]lthough the provisions of Title II refer expressly to ‘persons who are employed’ (or ‘engaged in paid employment’) (‘personnes qui exercent une activité salariée’) or who are ‘self-employed’ (‘personnes qui exercent une activité non-salariée’) rather than to ‘employed’ or ‘self-employed persons’ (‘travailleurs salariés’/‘non-salariés’), a logical and consistent interpretation of the scope ratione personae of the Regulation, and of the system of rules of conflict of laws which it establishes, requires the terms in question of Title II to be interpreted in the light of the definitions in Article 1(a). Accordingly, just as the description ‘employed person’ or ‘self-employed’ for the purposes of Articles 1(a) and 2(1) of the Regulation depends on the national social security scheme under which the person is insured, ‘a person who is employed’ (or ‘engaged in paid employment’) and ‘a person who is self-employed’ for the purposes of Title II of the Regulation should be understood to refer to activities deemed such by the legislation applicable in the field of social security in the Member State in whose territory those activities are pursued.185

Thus, the personal scope of the provisions of Title II is to be determined according to the definitions in Art 1(a). In other words, the applicable criterion for the 180 Paragraph 8 of the judgment. The case referred to a Belgian national who was self-employed in Belgium, where he resided. In addition, he was the director of, and sole shareholder in, a limited company in the Netherlands. He was usually present there for two days a week. In respect of the latter activity, he was required to pay contributions to the Netherlands social security scheme. The question that emerged was whether he was to be regarded as an employed or a self-employed person on account of his activity in the Netherlands. The issue of payment of the contributions was dependent on this answer. 181 In French ‘travailleurs salariés/non-salariés’. 182 In French ‘personnes qui exercent une activité salariée/non-salariée’. 183 Paragraph 13 of the judgment. 184 See R Cornelissen, above n 121, at 40–42. See also Cases C-178/97 Barry Banks and Others [2000] ECR I-2005; C-425/93 Calle Grenzshop [1995] ECR I-269. 185 Paragraphs 22 and 23 of the de Jaeck judgment (C-340/94 [1997] ECR I-461). See also Cases C71/93 Van Poucke [1994] ECR I-1101; C-221/95 Hervein and Hervillier [1997] ECR I-609.

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182 Work Interruptions and the Personal Scope of the Co-ordination Regulations concepts used in Title II has to be the social security criterion.186 It should be clarified here that this applies to both the concept of employed and the concept of self-employed as used in Title II. Both are to be understood in light of the respective definitions in Title I. The concepts used in Title II do not have their own meanings, nor are they to be understood by reference to labour law or by reference to the concept of ‘employed’ used in other areas of Community law.187 One might expect that all persons covered by Art 2(1) would also be covered by the provisions and principles found in Title II, since the personal scope of Titles I and II are determined by reference to the same provision, ie Art 1(a), and on the basis of this same criterion, ie the criterion of social security. Such an identification of the personal scope of the two titles was one of the main arguments put forward by the Commission in several cases, for instance in Commission v Netherlands.188 However, in a series of cases the Court established that not all persons covered by Reg 1408/71 are covered by Title II. This means in practical terms that the main principles of one applicable legislation and lex loci laboris are not applicable to all persons covered by Reg 1408/71. Categories of persons falling outside the application of these principles are those who have terminated their employment and those who have temporarily interrupted it, an interesting development analysed in the following pages. b. Persons Not Actively Pursuing an Economic Activity and the Application of the Main Principles of Title II The discussion here begins with those people having definitely ceased work and then proceeds to people temporarily interrupting work. i. Definite Cessation of Work and Application of the Main Principles of Title II The case law concerning the application of the main principles of Title II to persons who have definitely ceased economic activity refers mainly to two categories of people, namely pensioners and people who have taken early retirement. With regard to pensioners, the Court held that the provisions of Title II are not applicable to them. In particular, the Court held that the provisions of Title II are designed to resolve conflicts of legislation which may arise where, during a single period, the place of residence and the place of employment are not situated in the same Member State. 186

Schoukens also supports the view that social security is the criterion to be used for the definition of self-employed persons within the context of Title II. As he points out, the rules for determining the applicable legislation, which are contained in Title II, were largely developed to cover employed persons and do not always fit the particular situations of self-employed people very well.Yet, he considers that the adoption of different definitions for the purposes of application of Title II, where other criteria such as labour law and tax law criteria could play a role, would be inappropriate and perhaps make the Regulation unworkable in practice: ‘Would it not be remarkable that legislation (in this case the Regulation) would fail to adhere to the definitions which it has stipulated itself?’ (P Schoukens, ‘Selfemployed People and the Determination of the Legislation Applicable (Title II Reg 1408/71)’ in P Schoukens (ed), Prospects of Social Security Co-ordination (Leuven, Acco, 1997), at 158–60.) Concerning the problems caused with regard to the application of Title II after the extension of the Regulation to the self-employed, see also R Cornelissen, above n 10, at 34. 187 Eg, the concept of worker in Art 39 of the Treaty and Reg 1612/68, as the Netherlands Government argued in Case C-340/94 de Jaeck [1997] ECR I-461. See also R Cornelissen, above n 121, at 40–42. 188 Case C-198/90 Commission v Netherlands [1991] ECR I-5799, in particular para 6 of the judgment.

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The Choice of Law System 183 Such conflicts can no longer arise, emphasised the Court, in the case of workers who have definitely ceased all professional or trade activity. Consequently, the principles of one applicable legislation and lex loci laboris do not apply to such people.189 It should be noted here that if the pensioner in question continues to pursue an economic activity, even for a few hours a week, the provisions of Title II apply.190 The Court held that the same applies to people who have taken early retirement.191 In the van Pommeren-Bourgondiën case,192 however, the Court found that the legislation of the Member State of employment was applicable in one case of definite cessation of work. The question was whether a person who had interrupted work but remained subject to the legislation of the Member State with respect to some employment-related branches of social security and received invalidity benefits under it, could continue to be subject to the same legislation even with respect to residence-based schemes, such as the family benefits schemes. The Court replied that a person in such a position could not be excluded from residence-based schemes if such exclusion meant ‘less favourable treatment’ of non-residents as compared with those who resided in the competent Member State. Such unfavourable treatment would be in conflict with Art 39 of the EC Treaty. ii. Temporary Interruption of Work and Application of Title II Title II is not applicable to persons who have definitely terminated their economic activity. The question was raised, however, as to persons temporarily interrupting work. This is of particular importance with respect to the issues raised in this book, as both work interruption due to childbirth/child-rearing and/or migration are presumably temporary work interruptions. The Community law developments in this area have been interesting, complex and often contradictory, as shown in the analysis given in the following pages.

Article 13(2)(f) of Reg 1408/71 Soon after the judgments concerning pensioners and early retired persons were given, Reg 1408/71 was amended by Reg 2195/91.193 A new article was inserted— namely Art 13(2)(f)—pursuant to which, when the legislation of a Member State ceases to be applicable to a person without the legislation of another Member State becoming applicable in accordance with the pertinent provisions of Reg 189

Case C-140/88 Noij [1991] ECR I-0387. The Court however held that the fact that a person can be subject to two legislative systems does not mean that s/he should pay contributions in the country of residence for compulsory insurance to cover benefits payable by the institution of another Member State. See also Case C-374/98 Commission v France [2001] ECR I-10799, concerning recipients of occupational disease pensions; see below n 216. 190 Case C-2/89 Kits Van Heijningen [1990] ECR I-1755. See also E Eichenhofer, ‘Co-ordination of Social Security and Equal Treatment of Men and Women in Employment: Recent Social Security Judgments of the Court of Justice’ (1993) 30 CML Rev 1021. 191 See Cases C-245/88 Daalmeijer [1991] ECR I-555; C-198/90 Commission v Netherlands [1991] ECR I-5799; C-57/90 Commission v French Republic [1992] ECR I-75. 192 Case C-227/03 [2005] ECR I-06101. 193 [1991] OJ L206/2.

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184 Work Interruptions and the Personal Scope of the Co-ordination Regulations 1408/71,194 that person is subject to the Member State in whose territory s/he resides. The application of the legislation of the Member State of residence is determined solely in accordance with its provisions. The insertion of the article invoked serious problems of interpretation; indeed, one may ask whether it actually created more problems than it solved. The background to the amendment will be discussed below, followed by an analysis of the application of the article in cases of temporary work interruption, most notably work interruption due to childbirth/child-rearing. Background to the Insertion of Art 13(2)(f) of Reg 1408/71 As stated in the preamble to Regulation 2195/91, the amendment of Reg 1408/71 was deemed necessary after the judgment in the Ten Holder case and in the aftermath of that judgment. The Ten Holder case 195 This case referred to a Dutch national who had worked in Belgium, Germany and the Netherlands. Her last employment was in Germany, where she became incapacitated for work, and consequently received sickness benefits under German legislation. She returned to live in the Netherlands, where she continued to receive the German benefits for a period of more than a year. Finally, the German sickness benefits were discontinued on the ground that the maximum period for their payment had expired. The Dutch authorities refused to pay her a Dutch benefit, which otherwise would be due, arguing that the Community provisions on the application of a single piece of legislation precluded such payment as the only applicable legislation was the German legislation by virtue of the lex loci laboris principle. The question on which the preliminary ruling was based was whether the plaintiff was still subject to the German legislation, even though almost a year and a half had passed since her employment relationship had terminated. The Court held that a worker who ceases to carry on an activity in a Member State and who has not gone to work in another Member State continues to be subject to the legislation of the first Member State regardless of the length of time that has elapsed since the termination of the activity in question and the end of the employment relationship. The decision was subject to criticism for its negative effects both as regards the rights of individual people, and as regards its impact on the national social security systems. With regard to individuals, it was argued that the ruling can be seen as having an adverse effect on the rights of individuals inasmuch as it prohibits them from claiming benefits in their state of residence. This is particularly disadvantageous for non-active people whose last employment was in a Member State with an insurance scheme based on completing periods of employment, who become resident in another Member State with an insurance scheme based on residence. The Commission emphasised these impacts in explaining its reasons for revising 194 195

Regulation 1408/71, Arts 13(2)(a), (b), (c), (d), (e) and 14–17. Case 302/84 [1986] ECR 1821.

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The Choice of Law System 185 Reg 1408/71. Thus Reg 1408/71 had to be revised in order to solve the problems resulting from the Ten Holder ruling.196 With regard to the national social security schemes, the Ten Holder ruling was criticised as being problematic for national insurance schemes in which periods of contribution are not always required to be completed as such schemes are primarily based on residence.197 The fear was that, as a result of Ten Holder, people who worked for a short period in a state with non-contributory schemes would remain subject to those schemes even after moving to another Member State. In other words, the fear was that the case would induce ‘social tourism’. Pennings emphasises that the case caused consternation due to the possibility that it might lead to a situation where a national insurance system finds itself covering a very large group of insured people who are not paying contributions. An example referring to the Netherlands social security system was used to illustrate the risk: a national of a Member State employed in the Netherlands for a certain period, after which s/he moves to another Member State (not engaging in employment), may apply for family allowance on the basis of the Dutch regulations, since s/he remains subject to Dutch legislation. If s/he has no income, no contributions are required. If s/he has a sufficient income, it appears to be difficult, in practice, to collect contributions from her/him while s/he is residing abroad.198 These considerations have obviously had an impact in subsequent cases referring to pensioners and to people who retired early. In both Daalmeijer and Commission v Netherlands, the Advocate General made reference to the Ten Holder case. He argued that that the Court’s ruling in that case should not be interpreted as establishing a kind of ‘principle of unlimited affiliation’ to the social security system of the country of last employment. Although the Ten Holder case could, in fact, be deemed to concern definite cessation of work, the Advocate General took the view that the judgment should be understood as applying in the case of a worker who temporarily ceases to be employed—on grounds of sickness or pregnancy, for instance—and who for the duration of the cessation moves to reside in another Member State. It should not make any difference, according to the Advocate General, whether such temporary cessation and establishment in another country was for a longer period.199 Against this background, Art 13(2)(f) was inserted into Reg 1408/71. The anxieties of the Member States were not specifically mentioned in the preamble to the amending Regulation as a reason behind the insertion, although they seem to have played a major role. Rob Cornelissen, Head of the Social Security Unit in the European Commission’s DG V, is quite clear on this point: 196

F Pennings, above n 28, 77–78. Ibid. Ibid. 199 Paragraphs 16–20 of the Opinion of Advocate General Mischo, delivered on 14 June 1990, in the Daalmeijer case (C-245/88 [1991] ECR I-555). See also Report for the Hearing in the same case, at I-560, I-561; para 9 of the Opinion of Advocate General Van Gerven, delivered on 17 September 1991, in the Commission v Netherlands case (C-198/90 [1991] ECR I-5799). 197 198

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186 Work Interruptions and the Personal Scope of the Co-ordination Regulations Article 13(2)(f ) was inserted in Regulation 1408/71 as a reaction to the Court’s judgment in the Ten Holder case . . . This judgment caused a lot of uneasiness in some Member States, in particular the Netherlands. They feared that, given the mandatory effect of the Community rules on conflicts of law . . ., this judgment could lead to situations where persons may go and work for a short period in a Member State with a residence based scheme in order to remain insured under that scheme following their return to the State of residence, presuming that they did not take up any professional activity in the latter State. Therefore, Article 13(2)(f) has been inserted in the Regulation, stipulating that such postactive workers shall be subject to the legislation of the State where they reside. A couple of months before the adoption of the Regulation inserting Article 13(2)(f) into Regulation 1408/71, the Court had already indicated that the fears to which I have just referred were unjustified [note: reference to the Noij and Daalmeijer cases].200

The Application of Art 13(2)(f) in Cases of Temporary Work Interruption Despite the fact that Art 13(2)(f) was inserted against a background of differentiation between permanent and temporary work interruption as to the application of the lex loci laboris principle, no distinction between these two forms of work interruption was incorporated in its wording. Undoubtedly it was already clear at the time of the insertion that a literal interpretation of the article would entail not applying the lex loci laboris principle even in cases of temporary work interruption. Perhaps the Court had the intention of clarifying this point when it stated in the Twomey case:201 ‘Only workers who have definitely ceased all professional or trade activity fall outside the scope of Article 13(2)(a) of Regulation 1408/71’ (emphasis added).202 It follows that workers who temporarily cease to work should continue to be covered by this article and, consequently, be subject to the legislation of the state of (last) employment.Yet, it was clear that Art 13(2)(f) could establish the principle of application of the lex loci domicilii on account of all those who had ceased work, even temporarily. This soon proved to be the case in Kuusijärvi. The Kuusijärvi case203 This case concerned a woman in receipt of parental leave under Swedish legislation, who during her leave moved to Finland. She did not resume employment in Finland. The question was which article of Title II was applicable: Art 13(2)(a) (establishing the lex loci laboris principle) or 13(2)(f) (establishing the lex loci domicilii principle)? According to the former, she would be subject to the Swedish legislation. According to the latter, she would be subject to the Finnish legislation. Practically, it meant that, in the former case, the Swedish legislation’s residence requirements with regard to paying the parental benefit would be inapplicable. In the latter, they would be applicable. 200

See also R White, above n 12, at 52. Case C-215/90 [1992] ECR I-1823, delivered on 10 March 1992, ie after the decisions referring to retired and early-retired persons and the insertion of Art 13(2)(f). 202 Paragraph 10 of the Twomey judgment (C-215/90 [1992] ECR I-1823). 203 Case C-275/96 Kuusijärvi [1998] ECR I-3419. For a fuller account of the facts of the case and further analysis, see below, ch 5 at II, 4.3 b. 201

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The Choice of Law System 187 The Court held that Art 13(2)(f) is specifically intended to govern situations in which a person has ceased all occupational activity in the territory of a Member State and is no longer subject to any legislation applicable by virtue of the other provisions of Art 13(2), including subparagraph (a), or the provisions of Articles 14 to 17 of Reg 1408/71. To that end, the article declares the legislation of the Member State in whose territory s/he resides to be applicable. Accordingly, the Court said, a person in such a situation is subject by virtue of Article 13(2)(f) and in accordance with the legislation of the state in whose territory s/he resides, either to the legislation of the state in which s/he was previously employed, if s/he continues to reside there, or to that of the state to which, if such be the case, s/he has transferred her/his residence.204 This reasoning is obviously in conflict with the Court’s own statement in the Twomey case that only workers who definitely cease all activity fall outside the scope of Art 13(2)(a). It is noteworthy that the Swedish and Norwegian governments argued on the basis of the case law existing at the time that Art 13(2)(f) applied only in cases of a definite cessation of occupational activity on the part of the person concerned. The Netherlands and Finnish Governments, on the other hand, argued that Art 13(2)(f) lays down an express conflict rule which applies to situations where, for whatever reason, a person has ceased all occupational activity in a given Member State and resides in another without working there, thereby rendering obsolete the line of case law beginning with Ten Holder. The Commission argued that the case law was still valid and that Art 13(2)(f) was applicable only from the date of expiry of entitlement to a benefit in the state in which the person concerned was last employed, save where s/he had definitely ceased all occupational activity. The Court’s view was that: [T]here is nothing in the wording of Article 13(2)(f) of Regulation No 1408/71 to suggest that that provision applies only to workers who have definitely ceased all occupational activity and not to persons who have merely ceased their occupational activity in a given Member State. On the contrary, that provision is couched in general terms so as to cover any situation in which the legislation of a Member State ceases to be applicable to a person, for whatever reason, and not only because the person concerned has ceased his occupational activity, be it definitively or temporarily, in a given Member State.205 (emphasis added)

The Court added that to restrict the application of Art 13(2)(f) to situations in which all occupational activity has definitively ceased would amount to depriving that provision of part of its substance. The Court held that the intention of the Community legislature was to fill in the ‘gap’ in Title II which the Ten Holder case had revealed. Thus, the Court found that the article sought to make an express provision for the case of a person who had ceased to engage in any occupational activity under the legislation of one Member State and who resided in the territory of another Member State. The Court held that Art 13(2)(f) applies to a person who 204 205

Paragraphs 33–34 of the judgment. Paragraphs 39–40 of the judgment.

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188 Work Interruptions and the Personal Scope of the Co-ordination Regulations has ceased her/his occupational activities in one Member State and has transferred her/his residence to another Member State and, on the other hand, does not preclude the legislation of a Member State from making affiliation to a social security scheme of that Member State subject to a residence requirement.206 The case was the subject of significant criticism as to its unjust effects, as it deprived the person concerned of benefits s/he would have been entitled to if s/he had not moved, and caused a number of problems. A question was raised as to when the legislation of the state of last employment ceases to apply. The Commission argued that the legislation of that Member State must be considered applicable until the award of benefits expires. Questions were raised as to whether the Member States alone would decide when an award of benefits was to expire. Pennings argues that the Member States alone had to define exactly when the coverage of their social security insurance was to terminate.207 In addition, it was asked whether Kuusijärvi entails the application of Art 13(2)(f) in other cases of presumably short interruptions from work such as unemployment, leave, strikes, etc.208 The question was discussed with particular emphasis on unemployed people, as Ms Kuusijärvi was unemployed before receiving parental benefit. Pennings, for example, implies that the reason why Art 13(2)(f) applied in the Kuusijärvi case was that Ms Kuusijärvi was unemployed.209 Rentola, on the other hand, considers the parental leave to be the reason for the cessation of the occupational activity that led to the application of Art 13(2)(f).210 Kjönstad is of the same opinion. In his view, exclusion of an unemployed person from the main lex loci laboris principle is not justified, since an unemployment benefit is a typical short-term benefit that implies a quick return to work.211 Two remarks have to be made as regards this issue: First, there is no doubt that the application of Art 13(2)(f) in the Kuusijärvi case was due to the fact that Ms Kuusijärvi was on parental leave. The fact of the movement, which raised the issue of application of Community law, occurred during the period of parental leave and not during the period of unemployment. Second, the possibility that Kuusijärvi may also lead to the application of Art 13(2)(f) to unemployed persons cannot be ruled out, since in the case no discussion or distinction was made between the different reasons for temporary work interruptions for the purpose of application of the article. However, an application of Art 13(2)(f) to unemployed persons, resulting in 206

Paragraph 50 of the judgment. F Pennings, ‘Commentary on the Kuusijärvi Judgment’ (1999) 1/1 European Journal of Social Security 113, at 135. The implementing Reg 574/72 was amended on that point. Article 10b of this Regulation now provides that the date and the conditions under which the legislation of a Member State ceases to be applicable to a person, as referred to in Art 13(2)(f) of Reg 1408/71, are to be determined in accordance with the provisions of that legislation. 208 F Pennings, above n 28, at 80. See also F Pennings, above n 104, at 254. 209 F Pennings, above n 28, at 80. 210 E Rentola,‘Coordinating the Social Security of Women Moving Between Member States—A Case of Parental Benefits’ in L Kaliiomaa-Puha (ed), Perspectives of Equality—Work, Women and Family in the Nordic Countries and EU (Copenhagen, Nordic Council of Ministers, 2000), at 324 and 326. 211 A Kjönstad, ‘Rett til ‘‘föräldrapenning’ og födselspenger etter flytting mellom EÖS-land’ in A Numhauser-Henning (ed), Normativa Perspektiv. Festskrift till Anna Christensen (Lund, Juristförlaget, 2000). 207

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The Choice of Law System 189 depriving them of the right to export the parental family, would come into conflict with Art 74 of Reg 1408/71. That article explicitly provides for the exportability of family benefits by unemployed persons.212 Nevertheless, a new turning point for the application of the lex loci laboris principle in cases of temporary work interruption, despite Art 13(2)(f), came about with the Elsen case. The Elsen case 213 This case concerned a German national, employed in Germany, who lived in France. Her occupational activity was interrupted due to maternity leave after the birth of her son. After the expiry of her maternity leave, she was no longer engaged in an occupational activity either in Germany or in France. Some years later, she asked the German authority to take the period spent rearing her son into consideration for the purposes of acquiring a right to an old age pension.214 The question was whether she was still subject to the German legislation, or whether she was subject to the French legislation pursuant to Art 13(2)(f) of Reg 1408/71. The Court held that Art 13(2)(f) was not applicable. In the Court’s opinion, Ms Elsen could not be regarded as having ceased all occupational activity, and could not, therefore, be subject to the legislation of the state in which she resided. Article 13(2)(f), the Court emphasised, specifically provides for the legislation of the state of residence to apply only where ‘the legislation of a Member State ceases to be applicable, without the legislation of another Member state becoming applicable to him in accordance with one of the rules laid down in the a foregoing subparagraphs’. The Court held that since the child was born at a time when the parent pursued an occupation in a Member State and was therefore subject to the social security legislation of that State, that legislation remained applicable in accordance with Art 13(2)(a) of Reg 1408/71.215 In other words, the Court declared the lex loci laboris principle to be the applicable principle and the German legislation was found to be applicable on the basis of this principle. Both the Kuusijärvi and Elsen cases referred to work interruption due to childrearing. Both women were linked to the labour market when the period of leave began; Ms Kuusijärvi was at the disposal of the labour market while Ms Elsen actively pursued an economic activity. Article 13(2)(f) and the lex loci domicilii principle were found applicable in the former case, while Art 13(2)(a) and the lex loci laboris principle were found applicable in the latter case. We may ask whether the Court intended to modify the case law, or was there an essential difference between the two cases that justified the application of different principles? One difference is that the transfer of residence in the Kuusijärvi case occurred after the work interruption and the award of the parental benefit, while the transfer of residence in the Elsen case occurred before the realisation of the risk of maternity and the work interruption. In that case, the application of the lex loci laboris or the 212

Below, ch 5 at II, 3.2. Case C-135/99 [2000] ECR I-10409. 214 For a more detailed account of the facts and discussion of the other questions raised by the case, see below, ch 5, at I, 1.2 b. 215 Paragraph 28 of the judgment. 213

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190 Work Interruptions and the Personal Scope of the Co-ordination Regulations lex loci domicilii principle would depend on the time of movement rather than the nature or duration of the work interruption. On the other hand, the fact that there was an actual link with the social security system of the Member State of last employment ought to speak for the application of the lex loci laboris principle in Kuusijärvi. Such a link did not exist in Elsen. However, a subsequent case, Kauer, supports the view of modification of the case law after the Kuusijärvi case as to the application of the lex loci laboris principle to people interrupting work for childrearing.216 The Kauer case 217 Next in the line of cases concerning the application of Art 13(2)(f) to persons interrupting work for child-rearing is the Kauer case. The case involved an Austrian national who had transferred her residence to Belgium after the birth of her three children. During the period of residence in Belgium, she was not engaged in any occupational activity.218 The question was whether childrearing periods spent in Belgium would be recognised by the Austrian legislation for the purpose of acquiring a right to old age benefits. The Austrian Government contended that the question of the recognition of the periods that the applicant devoted to rearing her children in Belgium must be determined on the basis of Belgian legislation, which was the applicable legislation pursuant to Art 13(2)(f) of Reg 1408/71 on the basis of Kuusijärvi. Ms Kauer did not have a sufficiently close link with the Austrian legislation, as that legislation required that in order for periods spent rearing children outside Austria but within the European Economic Area to be treated as periods of insurance, the applicant must be receiving, or have received, for the children concerned, cash maternity allowances or equivalent allowances under federal Austrian law. Ms Kauer did not fulfil this condition. The Austrian Government argued that since Member States have the liberty to organise their social security schemes as they wish, the national legislator was entitled to require the existence of a sufficiently close link with its social security scheme before child-raising periods completed in another Member State may be taken into account. 216 As to the application of Art 13(2)(f) see also Case C-374/98 Commission v France [2001] ECR I10799. In that case, the Commission, relying mainly on Art 13(2)(f), sought a declaration that, by levying contributions on Belgian occupational disease pensions payable to people who do not reside in Belgium, Belgium had failed to fulfil its obligations under Community law. The main argument of the Commission was that people who were entitled to a Belgian occupational disease pension but did not reside in Belgium were subject solely to the legislation of the Member State of residence by virtue of Art 13(2)(f). Therefore, in levying contributions, Belgium was in breach of Community law. To strengthen this argument, the Commission also invoked other provisions of Reg 1408/71, according to which the persons concerned were entitled to health care benefits and family benefits in the Member State of residence. The Court did not find the arguments of the Commission convincing. It held that Art 13(2)(f) applies only if no other legislation is applicable and, in particular, only if provisions to which the person concerned had previously been subject cease to be applicable to him (para 29 of the judgment). Obviously, the cessation of the application had to be determined by the national legislation itself. According to the Court, the Commission had failed to prove that the national legislation had ceased to apply. 217 Case C-28/00 [2002] ECR I-1343. 218 For a more complete account of the facts and discussion of the other questions of the case, see below ch 5, at I, 1.2 b.

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The Choice of Law System 191 The Court held that the national legislation introduced, for the determination of periods of insurance and periods treated as such for the purpose of old age insurance, a difference in treatment. The legislation unconditionally took into account child-raising periods completed in national territory and made the taking into account of child-raising periods spent in another state party to the EEA Agreement or in another Member State subject to receipt of cash maternity allowance or equivalent allowances under federal Austrian legislation. Such legislation, the Court emphasised, is liable to work to the disadvantage of Community nationals who, having resided or worked in Austria, then exercise their right, as workers, as members of a worker’s family or as Union citizens, to free movement and residence in the Member States, as guaranteed in Articles 8a, 48 and 52 of the EC Treaty (now, after amendment, Articles 18 EC, 39 EC and 43 EC). It is essentially those Community nationals who are affected by the problem completing childraising periods outside Austria.219 As to the application of Art 13(2)(f), the Court held that it was not applicable. The applicable legislation for the period of work interruption owing to childrearing was the legislation of the Member State of last employment, even though the person concerned was not in receipt of maternal or equivalent benefits during that period, as can be seen from the Elsen case. The fact that Ms Kauer had worked in only one Member State and was subject to the legislation of that state when the child was born enables ‘a sufficiently close link’ to be established between those childraising periods and the periods of insurance completed by virtue of the pursuit of a gainful occupation in that state, the Court emphasised.220 The Dodl and Oberhollenzer case 221 The question of whether people (women) interrupting work for the purposes of raising children retain their status as employed people or not was raised again, directly this time, in the Dodl and Oberhollenzer case. The case referred to two Austrian nationals who worked in Austria but lived in Germany with their husband and partner respectively, both of whom have German nationality. Following the birth of their sons, Ms Dodl took unpaid parental leave for a period of three and a half months and Ms Oberhollenzer for a period of almost two years. Both applied for a child-raising allowance in Germany. These applications were rejected by the German authorities on the ground that, in their view, Austria was the competent state in respect of these benefits since it was the Member State of employment. Ms Dodl and Ms Oberhollenzer attempted subsequently to obtain childcare allowance in Austria. These applications were also rejected. One of the questions submitted to the Court was whether the applicants retained their status as ‘employed’ persons during the period of work interruption, which would entail the application of the legislation of the Member State of employment pursuant to Art 13(2)(a) of Reg 1408/71. The Court ruled that a person has ‘employed person’ status if s/he is covered by a social security scheme, and that mere suspension of the main obligations involved 219 220 221

Paragraphs 43 and 44 of the judgment. Paragraph 32 of the judgment. Case C-543/03 [2005] ECR I-05049.

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192 Work Interruptions and the Personal Scope of the Co-ordination Regulations in an employment relationship for a given period of time cannot deprive the employee of this status.222 The Court emphasised, though, that it is up to the national legislation to lay down the conditions of affiliation to a scheme and, therefore, the national court had to make the necessary enquiries to determine whether the claimants in the main proceedings belonged to a branch of the Austrian social security system at the material time.223

Remarks concerning Art 13(2)(f) of Reg 1408/71 The main reason posited for the insertion of the article is the need to establish an applicable legislation in all cases. This is a fundamental aim for any co-ordination system. Since economically non-active people were not covered by the fundamental principles of one applicable legislation and lex loci laboris of Title II, according to the case law, there was a risk of a negative conflict of laws. A situation might arise whereby no legislation could be established as applicable on the basis of the Community rules at the same time as the person concerned would not be covered by any system on the basis of national provisions. That was considered unacceptable and Art 13(2)(f) was inserted to fill the gap. However, it is highly questionable whether the aim of avoiding a negative conflict of laws was accomplished with the insertion of Art 13(2)(f). The application of national legislation is ultimately dependent on the provisions of the national legislation itself as the article provides that the person concerned is to be subject to the legislation of the Member State of residence ‘in accordance with the provisions of that legislation alone’ (emphasis added). If the Member State of residence has an employment-based system, the person concerned will not be covered by the system. Thus the risk of a negative conflict of laws is unavoidable in cases of movement towards a Member State with an employment-based system. Problems can, however, occur even in Member States with a residence-based system since the wording of the article implies that the other principles of co-ordination (aggregation and exportability, for instance) are not applicable. If, for instance, the legislation of the Member State of residence requires periods of residence to be completed before a benefit can be awarded, it may be necessary to apply the aggregation principle in order to acquire a right to the benefit.Article 13(2)(f) implies, however, that such an application is not possible.224 Sakslin suggests that a person be automatically insured or covered by the social security system of the Member State, the legislation of which is deemed to be the applicable legislation according to the Regulation, regardless of whether s/he has the right or obligation to join that system, pursuant to national legislation. The solution that would best guarantee citizens’ right most simply, she argues, would be one where, in indicating the applicable legislation, the 222 223 224

Paragraphs 30–31 of the judgment. See also Case C-153/03 Weide [2005] ECR I-06017. Paragraph 33 of the judgment. Cf Case C-111/91 Commission v Luxembourg [1993] ECR I-0817.

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The Choice of Law System 193 Regulation also requires that insurance coverage be accorded to the person in question.225 Article 13(2)(f) introduced the principle of application of the lex loci domicilii as a supplementary principle in the system of the choice of law rules. The (partial) introduction of the principle was, as already stated, advocated by a considerable number of legal authors. Its application, however, was linked to the nature of the benefits at issue.226 In Art 13(2)(f), the application of the principle is linked to the employment status of the person concerned. As a consequence, the application of the principle has often led to a loss of employment-related benefits on the part of the person concerned. These benefits would have been saved if the person at issue had not moved. In these circumstances, movement does not appear to be an attractive option. The article produces results that are in conflict both with the free movement and with the social objectives of the co-ordination system. Finally, the gender implications of Art 13(2)(f) should be noted. Due to frequent work interruptions based on family concerns, women are more likely to fall within the scope of this article. This is also evident in the case law. 2. The Provisions of Reg 883/04 The provisions concerning the determination of the applicable legislation are included, as already stated, in Articles 11–16 of Reg 883/04 and constitute Title II of the Regulation. The choice of law system of Reg 883/04 is based on the same principles as Reg 1408/71, that is to say the principle of application of one legislation, as well as the lex loci laboris principle as complemented by the lex loci domicilii principle. 2.1 The Main Principles Established in Title II The first main principle established in the choice of law system of Reg 883/04 is the principle of one applicable legislation. Pursuant to Art 11(1), persons to whom this Regulation applies are to be subject to the legislation of a single Member State only. The question that naturally follows is, which legislation is this? The answer is given by the lex loci laboris principle, as is the case under Reg 1408/71. With regard to some specific cases, it is stated that a person normally pursuing an activity as an employed person in two or more Member States is to be subject to the legislation of the Member State of residence if s/he pursues a substantial part of his/her activity in that Member State. Furthermore, such person is to be subject to the legislation of the Member State of residence if s/he is employed by various undertakings or various employers whose registered office or place of business is in different Member States.227 The person concerned is to be subject to the legislation of the 225 226 227

M Sakslin, above n 135, at 179. Above, at 1.1 b. Regulation 883/04, Art 13(1)(a).

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194 Work Interruptions and the Personal Scope of the Co-ordination Regulations Member State in which the registered office or place of business of the undertaking or employer employing him/her is situated, if s/he does not pursue a substantial part of his/her activities in the Member State of residence.228 Similar provisions exist with regard to self-employed persons.229 As to people normally pursuing one activity as an employed person and another activity as a self-employed person in different Member States, they are to be subject to the legislation of the Member State in which they pursue an activity as an employed person.230 All these people are to be treated, for the purposes of the legislation determined in accordance with these provisions, as though they are pursuing all their activities as employed or selfemployed persons and are receiving all their income in the Member State concerned.231 Although the principles of one applicable legislation and lex loci laboris are fundamental within the co-ordination system, exceptions are possible. Thus, according to Art 16(1), two or more Member States may by common agreement provide for exceptions to these principles in the interest of certain persons or categories of persons.232 Furthermore, in cases of posting, the person concerned will continue to be subject to the legislation of the sending Member State. The period of posting cannot exceed 24 months.233 Similar provisions exist for selfemployed persons performing activities in another Member State.234 Finally, the third principle of the choice of law system as established by Reg 883/04 is the the lex loci domicilii principle. 2.2 The Personal Scope of Title II of Reg 883/04 In the choice of law system established by Reg 883/04, the lex loci laboris principle is to apply to persons pursuing an activity as an employed or self-employed person.235 How the term ‘person pursuing an activity as an employed or self-employed’ is to be understood for the purpose of determining the applicable legislation is clarified in Art 11(2) of Reg 883/04: [F]or the purposes of this Title, persons receiving cash benefits because or as a consequence of their activity as an employed or self-employed person shall be considered to be pursuing the said activity. This shall not apply to invalidity, old-age or survivors’ pensions or to pensions in respect of accidents at work or occupational diseases or to sickness benefits in cash covering treatment for an unlimited period. 228

Ibid, Art 13(1)(b). Ibid, Art 13(2). Ibid, Art 13(3). See also Art 13(4) concerning civil servants. 231 Ibid, Art 13(5). 232 See also ibid, Art 15 concerning auxiliary staff of the European Communities. 233 Ibid, Art 12(1). 234 See ibid, Art 12(2). 235 Ibid, Art 11(3)(a). Special provisions referring to categories such as civil servants, unemployed persons and persons called up for service in the armed forces are also included in Art 11(3) of Reg 883/04. All these special categories of working persons are to be subject to the legislation of the Member State employing them. 229 230

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The Choice of Law System 195 The lex loci domicilii principle, on the other hand, is to apply to people other than those pursuing an activity as an employed or self-employed person. Thus, these people are to be subject in principle to the legislation of the Member State of residence.236 Regulation 883/04 thus preserves the dual system developed under Reg 1408/71. The contribution of Reg 883/04 in this respect is that it simplifies and clarifies the rules as to when each principle applies, therefore providing a means of avoiding the confusion and complications occurring under Reg 1408/71. This simplification and clarification is achieved through the rather complicated provisions of Title II, and it is mainly dependent on the definition of the term ‘person pursuing an activity as an employed or self-employed person’. In short, people actively pursuing an economic activity as well as people (obviously temporarily) interrupting economic activity and in receipt of shortterm cash benefits related to an economic activity are to be subject to the legislation of the Member State of (last) employment. In all other cases of work interruption and for all other people covered by the Regulation, the legislation of the Member State of residence is to apply. The period and the conditions for the award of the benefit are left to the competence of the Member States, as is the case under Reg 1408/71.237 After expiry of this entitlement, they will be subject to the legislation of the Member State of residence.238 A person can thus be subject to the legislation of the Member State of employment according to the lex loci laboris principle, or to the legislation of the Member State of residence pursuant to the lex loci domicilii principle. The person concerned, however, is always covered by only one piece of legislation: two pieces of legislation cannot apply simultaneously. The wording of the new provisions does not state that the legislation of the Member State of residence is to apply ‘in accordance with the provisions of that legislation alone’, as is the case under Reg 1408/71. This ought to mean that the legislation of the Member State of residence is to apply by virtue of Community law irrespective of whether it has an employment-based or a residence-based system. 3. Work Interruptions and the Choice of Law System As has been shown in the above analysis, a considerable proportion of the case law developed under Reg 1408/71 concerned cases of work interruption for reasons of childbirth/child-rearing. In contrast, there is no case law regarding work interruptions due to migration. The case law has now been incorporated in Reg 883/04 to a considerable extent, although several questions remain. 236 Ibid, Art 11(3)(e). An exception is provided in Art 16(2), pursuant to which a person receiving a pension or pensions under the legislation of one or more Member States and residing in another Member State may at his/her request be exempted from application of the legislation of the latter State provided that s/he is not subject to that legislation on account of pursuing an activity as an employed or self-employed person. 237 See also F Pennings, above n 28, at 85–86. 238 According to Art 1(j), residence means the place where a person habitually resides.

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196 Work Interruptions and the Personal Scope of the Co-ordination Regulations 3.1 Work Interruption because of Childbirth/Child-rearing Developments with regard to the issue of determining the applicable legislation in cases of temporary work interruption for child-rearing have been complex and often contradictory. If we attempt to summarise the state of the law under Reg 1408/71 concerning determination of the applicable legislation in cases of work interruption for childbirth/child-rearing, we have to conclude that the principle of application of the legislation of the Member State of employment, despite contradictions in the case law, seems to be the leading principle. Several uncertainties remain, though. It is not quite clear under this Regulation whether the application of the principle is dependent on the condition that the person concerned is in receipt of a social security benefit from the Member State of employment, or how the existence of a ‘sufficiently close link’ with the Member State of employment is to be determined. In any case, one can trace in the case law the gradual articulation of an explicit principle that the determination of the applicable legislation must not be in conflict with the objective of free movement. This principle ought to be given within the context of co-ordination; but it can be seen from the case law that this has not always been the case. As to the new Regulation 883/04, it simplifies the state of the law and clarifies for how long a person continues to be subject to the legislation of the (last) state of employment. A person is to be subject to the legislation of the Member State of last employment as long as s/he is in receipt of employment-related benefits from this Member State. Such benefits ought to be benefits relating to child-rearing in the first instance, but perhaps even other sorts of benefit will have the same result. The Regulation is not clear on this point. Nevertheless, Reg 883/04 does settle the law with regard to one of the main questions raised under Reg 1408/71, namely for how long a person interrupting work can be subject to the legislation of the Member State of employment. It fails, though, to reflect the other major developments emerging from the case law. For instance, it fails to include and clarify the criterion of ‘sufficiently close link’ with the Member State of employment, and—above all— it fails to embed the condition that the determination of the applicable legislation cannot be in conflict with the objective of free movement. Thus, the application of Reg 883/04 in cases like Elsen and Kauer would not obviously lead to results facilitating or promoting free movement. From the point of view of people interrupting work for child-rearing, though, such clarifications would be of the utmost importance. Focusing specifically on the particular category of people interrupting work for childbirth/child-rearing (or including a specific chapter referring to this situation), as was done with regard to certain other categories of person such as posted workers, would provide a better way of resolving the uncertainties and problems found within this category of people—the overwhelming majority of whom are women. This was not done, however, within the framework of Reg 883/04.

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Concluding Remarks 197 3.2 Work Interruption because of Migration The case law has at no point dealt with the issue of the application of lex loci laboris or lex loci domicilii to people interrupting work because of migration. Such migration is often family-related and the overwhelming majority of people interrupting work because of migration are women. The question, therefore, is whether any certain conclusions can be drawn on the basis of the material presented in terms of the application of the choice of law provisions to these people. The answer to this question is difficult, according to Reg 1408/71. Interruption of work because of migration (presumably temporary) may lead to the application of Art 13(2)(f) of Reg 1408/71, and consequently to the application of the legislation of the Member State of residence. Some authors, however, reject the suggestion that this article applies to unemployed persons239 (if we accept that persons falling into this category are unemployed persons),240 and others express doubts.241 The adoption of Reg 883/04 ought to be indicative of the development of the coordination law with regard to this issue and, consequently, the answer to be given pursuant to Reg 1408/71 must be similar to the answer given by the new Regulation. The new Regulation entails that persons falling into this category are to be subject to the legislation of the Member State of last employment, provided that they are entitled to employment-related benefits from this state. It is not clear whether the benefits must be unemployment benefits or any other kind of benefits. Before concluding, it should be mentioned that in its Report concerning the proposal for the adoption of Reg 883/04, the European Parliament suggested the inclusion of a recital aimed at recognising that people leaving employment in one Member State to move to another Member State for family reasons ought not lose the right to unemployment benefits in their new country of residence. As justification for this suggestion, the Report stated that it is important to recognise that people moving for family reasons should not lose the right to unemployment benefits either in the old or in the new country of residence.242 This suggestion was not accepted by the Commission and did not lead to any legal regulation of the issue.

CONCLUDING REMARKS

The concrete questions posed in this chapter were whether the scope of people covered by the co-ordination system, as laid down in the pertinent provisions of Reg 1408/71 and Reg 883/04, includes those whose employment has been interrupted because of child-rearing or migration. It was also asked whether the choice of law 239

A Kjönstad, above n 211. Below, ch 5 at II, 1.2 c. 241 F Pennings, above n 28, at 80. 242 See European Parliament, Report on the Proposal for a European Parliament and Council Regulation on Co-ordination of Social Security Systems (COM (1998) 779 of 17 June 2003. 240

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198 Work Interruptions and the Personal Scope of the Co-ordination Regulations provisions of the two Regulations and the principles established in them apply to the same categories of persons. As to the first question, it has been shown that both of these categories of persons are covered by Reg 1408/71, by virtue of Articles 2(1) and 1(a). The only criterion that has to be satisfied is the social security criterion. The person concerned must be insured against one social security risk under a national scheme. The insurance has to be based on economic activity but the type of economic activity is not important. Regulation 883/04 changed the state of law regarding the requirement of an economic element in the criterion of social security. Under the Regulation, all persons insured in a national scheme are to be covered by the co-ordination system, even those who have never been economically active. From the point of view of the people under consideration in this book, the new Regulation did not entail any essential changes. The people concerned can be covered on the basis of both Regulations. From a more general gender perspective, however, it is doubtful whether the new Regulation has brought about any essential changes.243 With regard to the application of Title II, which contains the choice of law provisions, to the persons at issue, it was found that they are covered by this Title. This means primarily that they are covered by the rule of single applicable legislation. The second major principle found in the system of rules as to choice of law is lex loci laboris. The application of this principle to the persons at issue according to Reg 1408/71 is, however, riddled with problems and uncertainties. Regulation 883/04 simplifies the state of the law and clarifies when and for how long a person continues to be subject to the legislation of the (last) state of employment. So, although the new Regulation does not yet apply, it is reasonable to conclude that the state of the law under both Regulations with regard to this question is that a person is to be subject to the legislation of the Member State of last employment as long as s/he is in receipt of employment-related benefits from this Member State. It is possible, however, that new issues will emerge, as the new Regulation failed to embed some other major developments emerging from the case law. It failed, for instance, to include and clarify the criterion of ‘sufficiently close link’ with the Member State of employment, and to handle the issue of ‘less favourable treatment’, and—above all—it failed to embed the condition that the determination of the applicable legislation cannot be in conflict with the objective of free movement. In this respect, cases such as Kauer and van PommerenBourgondiën must be considered to remain relevant even with regard to Reg 883/04.

243 See V Paskalia, ‘The (In)visibility of Gender in the New Regulation’ (2005) 7 European Journal of Social Security 197.

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5 Work Interruptions and the Application of the Fundamental Principles of Co-ordination INTRODUCTION

This chapter, like chapter four, focuses on scenarios where work is interrupted due to child-rearing or migration and on the issue of the legal regulation of such situations within the framework of the co-ordination system. The more specific concrete questions posed are whether the principles of aggregation of qualification periods, exportability of acquired benefits and non-overlapping of benefits apply to people interrupting work because of childbirth/child-rearing or migration. The principle of aggregation is entrenched in a number of provisions in Title III of Reg 1408/71. Title III contains specific provisions with regard to the specific branches of social security covered by the Regulation and is composed of a number of chapters equal to the number of social security branches. Aggregation provisions are contained in all the chapters, but the examination here is confined to the chapters concerning sickness/maternity benefits, old age benefits, unemployment benefits and family benefits. The content and meaning of the principle of aggregation is almost identical in all these chapters and is briefly outlined at the beginning of the section concerning the aggregation principle. Regulation 883/04, on the other hand, contains one general provision on aggregation as included in Title I, while some specific provisions are included in Title III with regard to specific benefits. The exportability principle is established as a fundamental principle of coordination, as stated in Title I of both Regulations. In Reg 1408/71, however, this general principle of exportability covers only long-term benefits. Old age benefits are the only long-term benefits of all the benefits and the relevant chapters of the Regulation examined in this book. Sickness/maternity, unemployment and family benefits are not covered by the general exportability principle as they are considered short-term benefits. The relevant chapters of Title III, however, contain provisions establishing a limited right of exportability, the content of which varies within the framework of each particular chapter depending on the benefit at issue. The content of these specific provisions is briefly outlined at the beginning of the section

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200 The Application of the Fundamental Principles of Co-ordination concerning the principle of exportability. In Reg 883/04, on the other hand, the exportability principle refers to all benefits. Short-term benefits are thus also covered by the general exportability principle Attention is also paid to the issue of classification of benefits. Benefits relating to childbirth/child-rearing can be classified as benefits related to either the maternity branch or to the family branch of social security. This classification is extremely difficult but also very significant, as it can lead to the application of different legal provisions within the framework of the co-ordination system. This issue of classification is discussed at the end of the section on exportability. The principle against the overlapping of benefits is first established as a general coordination principle in both Regulations currently in force. It is then reiterated in specific provisions within the chapter of Title III concerning family benefits. The content of these provisions and the meaning of the principle are also briefly outlined. The examination of the non-overlapping principle is confined in this chapter to family benefits and the pertinent chapter of Title III. Thus, the principles of aggregation and exportability are examined with regard to four categories of benefits, namely sickness/maternity, old age, unemployment and family benefits, while the non-overlapping principle is examined solely with regard to family benefits. Finally, some attention is paid to a new principle established in Reg 883/04, namely the principle of assimilation of facts. After outlining the content of each principle briefly at the beginning of each section, the question is posed within the framework of each section as to whether this principle applies to people interrupting work in general. The material analysed sometimes refers directly to people interrupting work because of childbirth/childrearing or migration, sometimes not. At the end of each section, the state of the law is assessed from the perspective of people interrupting work because of childbirth/ child-rearing in particular. An attempt is made to answer the question as to the application of each principle to each of these categories of people, on the basis of the analysis.

I. THE AGGREGATION PRINCIPLE

The aggregation principle is already entrenched in Art 42 of the EC Treaty, together with the principle of exportability, as one of the fundamental principles of coordination. According to Art 42: [T]he Council shall, acting in accordance with the procedure referred to in Article 251, adopt such measures in the field of social security as are necessary to provide freedom of movement for workers; to this end, it shall make arrangements to secure for migrant workers and their dependants: (a) aggregation, for the purpose of acquiring and retaining the right to benefit and of calculating the amount of benefit, of all periods taken into account under the laws of the several countries; (b) payment of benefits to persons resident in the territories of Member States.

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The Aggregation Principle 201 The aggregation principle is first examined in relation to Reg 1408/71 and subsequently in relation to Reg 883/04.

1. The Provisions of Reg 1408/71 The principle of aggregation is reiterated in a number of provisions in Title III of Reg 1408/71.1 Thus, aggregation provisions exist in all chapters of Title III: chapter one concerning sickness and maternity benefits, chapter two concerning invalidity benefits, chapter three concerning pensions, chapter four on accidents at work and occupational diseases, chapter five concerning death grants, chapter six on unemployment benefits, chapter seven concerning family benefits, and chapter eight concerning benefits for dependant children of pensioners and for orphans. This section will focus on the aggregation provisions contained in chapters one, three, six and seven of Title III, namely Articles 18, 45, 67 and 72. The objective of the aggregation principle is to ensure that a person moving from one Member State to another is not placed in a worse position as compared to a person who spends his entire career working in just one Member State. The aggregation of periods is the means by which the elements of a worker’s career are consolidated and by which her/his career can be considered as a whole. 1.1 The Content of the Aggregation Principle concerning Specific Benefits The wording of the aggregation provisions is very similar in all the chapters of Title III. It provides, in general, that where the legislation of a Member State makes the acquisition, retention or recovery of the right to benefits conditional upon the completion of periods of insurance or employment, the competent institution of that Member State is to take account, to the extent necessary, of periods of insurance or employment completed under the legislation of any other Member State as if they were periods completed under the legislation which it administers. When the benefits at issue are sickness and maternity as well as pension benefits, even periods of residence in another Member State can be aggregated. Periods of selfemployment are aggregated for the purpose of acquiring rights to family benefits. Which periods are deemed insurance periods, the conditions under which an insurance period is deemed to have been completed, and whether certain periods— for example, childcare, unemployment or military service—are assimilated with other periods, falls under the jurisdiction of a Member State.2 National provisions 1

Page points out that the range and complexity of the different national social security systems effectively precluded their co-ordination on the basis of general principles alone. Thus, Reg 1408/71 followed the system adopted in its predecessor, Reg 3, of setting out the rules governing each type of benefit in separate chapters of Title III of the Regulation. See AC Page, ‘The Scope of Community and National Rules against the Overlapping of Social Security Benefits’ (1980) 17 CML Rev 211, at 215. That was changed in Reg 883/04, where a general aggregation principle is inserted 2 For a discussion of the problems involved in assimilating periods under the systems of the Member States for the purpose of applying the aggregation principle, see M Sakslin, ‘Social Security

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202 The Application of the Fundamental Principles of Co-ordination must be consistent, however, with the provisions of Community law, particularly those relating to free movement of workers and all citizens of the Union.3 After this brief outline of the content of the principle, the focus will turn to the personal scope of the pertinent provisions. The issue examined first is whether the aggregation provisions apply in general to people interrupting work. 1.2 The Personal Scope of the Specific Aggregation Provisions of Title III The issue of the application of the aggregation principle to people interrupting work is examined in this sub-section with regard to four chapters of Title III, ie, the chapters concerning sickness/maternity benefits, old age, unemployment and family benefits. These chapters have been chosen because of their importance for people interrupting work due to childbirth/child-rearing or migration. a. Sickness/Maternity Benefits There is no reference to the beneficiaries of the aggregation principle in the wording of Art 18(1) of Reg 1408/71. All the provisions of chapter one of Title III, however, indicate that it applies, in the first instance, to employed and self-employed persons. Special categories of workers, such as seasonal workers, unemployed persons and pensioners who are entitled to draw pensions under the legislation of two or more Member States are specifically referred to as beneficiaries of the principle in separate provisions.4 How then is the concept of an ‘employed or self-employed’ person to be understood within this context? Is it to be understood in the light of Art 1(a) of Reg 1408/71? Or does it have its own meaning in this particular context? A person does not need to be economically active in order to be considered an ‘employed or self-employed’ person according to Art 1(a) of Reg 1408/71, provided that s/he is covered by a national social security scheme, as discussed in chapter four. Consequently, if we accept that the personal scope of the provisions of Title III, in particular Art 18(1), is to be understood in the light of Art 1(a), the provisions are to apply to economically non-active people provided that the social security criterion is fulfilled. It is not certain, however, whether the personal scope of the provisions of Title III is to be understood in the light of Art 1(a). The case law concerning other provisions of Title III suggests that this is not always the case.5 There is unfortunately very little material concerning the personal scope of Art 18(1) of Reg 1408/71. Case law is lacking and the issue has received only limited attention in the academic literature. Rentola argues that work interruptions make the application of the aggregation principle for the purpose of acquiring the right to Co-ordination—Adapting to Change’ (2000) 2 European Journal of Social Security 169, at 174–8. See also Cases 2/72 Murru [1972] ECR 333; C-117/84 Ruzzu [1985] ECR 1697; C-349/87 Paraschi [1991] ECR I4501; C-324/88 Vella [1990] ECR I-257; C-482/93 Klaus [1995] ECR I-3551; Joined Cases C-88/95, C102/95 and C-103/95 Losada, Balado and Paredes [1997] ECR I-869. 3 See eg Cases 302/90 Faux [1991] ECR I-4875; C-322/95 Iurlalo [1997] ECR I-4881; C-28/00 Kauer [2002] ECR I-1343. 4 See Arts 18(2), 25 and 27 of Reg 1408/71 respectively. 5 Below, at II, 1,2 d.

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The Aggregation Principle 203 earnings-related maternity benefits in the Member State of destination impossible. In contrast, she argues, earnings-related benefits acquired before movement can be retained. Thus, the time of movement is of crucial importance. Moving before a right to a benefit has been established can lead to a significant financial loss.6 This issue is obviously connected to the issue of determining the applicable legislation, as discussed in the previous chapter. If the woman concerned moves to another Member State before giving birth and takes up employment there, the aggregation principle is to apply. Earnings in the previous Member State of employment, however, are not to be taken into account in calculating the amount of the benefit. This is established in Art 23, which concerns the calculation of cash benefits, and according to which earnings made in another Member State or contributions paid in another Member State are not to be taken into account in the competent Member State for calculating benefits.7 This probably leads to a lower amount of benefit.8 Residence-based schemes, however, may also require completion of periods of residence for the purpose of awarding a maternity benefit. In Commission v Luxembourg,9 the Court held that Art 18(1) can be applied for the purpose of the acquisition of residence-based maternity benefits. b. Old Age Benefits Article 45(1) of Reg 1408/71 stipulates that periods of insurance or residence completed by the person concerned under the legislation of any Member State,‘be it under a general scheme or under a special scheme and either as an employed person or a self-employed person’, are to be taken into account by the competent institution for the purpose of the acquisition, retention or recovery of the right to old age benefits. It emerges from this paragraph, as well as from the other paragraphs in Art 45 specifying the aggregation principle in several situations, that the principle applies to ‘employed or self-employed’ persons. The question is therefore how the concept is defined within this context. Should it be defined in the light of Art 1(a) entailing that persons interrupting work should be covered by the aggregation provisions if they fulfil the criterion of social insurance? Or does it have a separate meaning in this context? No direct answer can be given to these questions on the basis of Reg 1408/71 or the case law. There are, however, some interesting cases illustrating the kind of problems a person interrupting work because of childbirth/child-rearing may encounter with regard to acquiring the right to old age benefits, and possible reasons for these problems, as well as illustrating the role of the co-ordination system. 6 See E Rentola, ‘Coordinationg the Social Security of Women Moving Between Member States—A Case of Parental Benefits’ in L Kaliiomaa-Puha (ed), Perspectives of Equality—Work, Women and Family in the Nordic Countries and EU (Copenhagen, Nordic Council of Ministers, 2000), at 320–1. 7 After the last amendment of Reg 1408/71 by Reg 647/2005 ([2005] OJ L117/1), a new provision— Art 23(2a)—was inserted, pursuant to which the provisions of paras 1 and 2 shall also apply, where the reference period provided for under the applicable legislation coincides in full or in part with a period completed under the legislation of one or more other Member States. 8 See also E Rentola, above n 6, at 320–1. 9 Case C-111/91 [1993] ECR I-817.

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204 The Application of the Fundamental Principles of Co-ordination The Elsen case10 The Elsen case concerned the acquisition of the right to an old age benefit for a period of work interruption that occurred due to child-rearing responsibilities. According to a provision in German law, compulsory statutory old age insurance contributions are to be deemed to be paid for the periods spent rearing a child, corresponding to the first three years of the child’s life. One of the conditions for crediting the period spent rearing a child to one of the parents was that the child-rearing took place in Germany, or could be treated as having taken place there. A period of child-rearing abroad is to be treated as child-rearing in Germany upon satisfaction of two conditions: first, where the child-rearing parent has habitually resided abroad with his or her child; and second, during the period devoted to child-rearing or immediately before the birth of the child the parent concerned had completed periods of compulsory contributions in Germany in respect of an activity carried on in another Member State as an employed or selfemployed person. In addition, according to another provision of the national German law, the period devoted to rearing a child until the end of the child’s 10th year is to constitute a period to be taken into consideration for one of the parents if the conditions for attribution of a period of child-rearing are also fulfilled during that period.11 Ms Elsen, a German national, moved to France in May 1981, where she lived with her husband and their son, born in August 1984. Until March 1985, she had a gainful occupation subject to compulsory insurance in Germany. After transferring her residence to France, she acquired the status of a frontier worker. Her occupational activity was interrupted between July 1984 and February 1985 owing to maternity leave for the birth of her child. After March 1985, she was no longer engaged in an occupational activity subject to compulsory insurance in either Germany or France. In September 1994, she requested the German authority to take into consideration, as periods of insurance for the purpose of an old age pension, the periods spent rearing her son, that is to say the child’s first 10 years. Her request was rejected on the ground that the child-rearing had taken place abroad and the conditions for treating this child-rearing period as completed in Germany had not been fulfilled. She could not provide proof of periods of compulsory contribution, under German legislation, during the period devoted to child-rearing or immediately before the birth of the child in respect of an activity as an employed person or a self-employed person exercised abroad. The question submitted to the Court of Justice was whether, by reason of Community law, the competent institution in a Member State had to take into account, for the purpose of the grant of an old age benefit, periods devoted to childrearing, completed in another Member State as though they had been completed in its national territory, by a person who, at the time the child was born, was a frontier 10

Case C-135/99 [2000] ECR I-10409. According to other provisions, gainfully employed women who had given birth should not be employed during the eight weeks following a confinement. In addition, all employed persons were entitled to parental leave until a child (born after 31 December 1991) had reached the age of three years. 11

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The Aggregation Principle 205 worker employed in the territory of the first Member State and residing in the territory of the second Member State. Several difficulties arose in the situation. Ms Elsen did not pay contributions in Germany, as required by the national German system. Neither did she fulfil the conditions for the attribution of periods devoted to child-rearing under French legislation, which required that the person concerned must previously have worked on French territory. She did not comply with the relevant provisions of Community law12 since she was not in receipt of maternity or parental benefits. The Court approached the case from the perspective of the national German legislation. The Commission, like the German Government, was of the view that the German legislation was compatible with the Community law when it required, in order to be credited with periods of child-rearing, that a person should maintain a link with the national insurance scheme, as the Member States are free to determine the content of their own legislation. The Court was of a different opinion. It held that provisions such as those of the German legislation are disadvantageous to Community nationals who have exercised their right to move and reside freely in other Member States, as guaranteed in Art 8a of the EC Treaty. By transferring her/ his residence to another Member State while continuing to work in Germany, a Community national (under the legislation of that state) automatically loses credit for periods of child-rearing completed in the state of residence. Regulation 1408/71, the Court further emphasised, adopted on the basis, inter alia, of Art 42 of the EC Treaty, contains a number of provisions designed to ensure that social security benefits are payable by the competent state, even where the insured, who has worked exclusively in her/his state of origin, resides in or transfers residence to another Member State. These provisions undoubtedly help to ensure freedom of movement not only for workers, under Art 48 of the Treaty, but also for citizens of the Union, within the Community, under Art 8a of the Treaty.13 On the basis of these considerations, the Court ruled that the periods of child-rearing in question had to be taken into account for the purpose of the granting of an old age pension by the competent German institution. The case was not exactly one on aggregating qualification periods, since Ms Elsen had not completed periods of work or insurance in France that could be aggregated with German periods. Rather, the issue concerned recognition of periods completed in another Member State. The Court, reformulating the question of the national court, stated that the question was essentially whether Community law 12 Point 19 of Section C of Annex VI to Regulation No 1408/7, inserted by Regulation No 2195/91 (OJ 1991 L206/2) and setting out special rules for the application of the legislation of certain Member States, provides in respect of Germany: ‘A period of insurance for child-rearing under German legislation is valid even for a period during which the employed person concerned brought up the child in another Member State provided that person was unable to engage in occupational activity by virtue of Para 6(1) of the Protection of Mothers Law (Mutterschutzgesetz) or took parental leave under Article 15 of the Federal Child-rearing Allowance Law (Bundeserziehungsgeldgesetz) and did not engage in any minor (geringfügig) employment within the meaning of Para 8 of SGB IV.’ However, this point did not take effect until 1 January 1986, ie after the period of time in the Elsen case. The period March 1985–January 1986 as in the case was not covered by this provision. 13 Paragraphs 34–35 of the judgment.

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206 The Application of the Fundamental Principles of Co-ordination requires that, for the purpose of granting an old age pension, the competent institution of a Member State must take into account periods devoted to child-rearing completed in another Member State as though they had been completed in its national territory.14 In any case, the judgment undoubtedly constitutes a significant development concerning the rights of several people (women in the overwhelming majority of cases) interrupting work for the purpose of child-rearing, whose rights to old age benefits under the applicable national law might be jeopardised because of their movement to another Member State. Although it is of practical significance only in relation to Member States recognising child-rearing periods in their old age schemes, the case marks an important development in Community social security law itself, inasmuch as it signifies a step forward in establishing the right of movement for all Union citizens. The Kauer case15 This case involved an Austrian national who had three children, born in 1966, 1967 and 1969. After completing her studies, she worked in Austria from July 1960 to August 1964. In April 1970, together with her family, she transferred her residence to Belgium, where she did not work.After returning to Austria, she resumed working and completed compulsory periods of insurance from September 1975. At her request, the competent Austrian institution recognised that, on 1 April 1998, she had accumulated 355 months of old age insurance under the Austrian legislation. Of that total, the institution recognised the 46 months corresponding to the period from July 1966, when Ms Kauer’s first child was born, to April 1970 when she moved to Belgium, as substitute qualifying periods spent in child-rearing, pursuant to the applicable provisions of national law. Ms Kauer challenged the decision, arguing that the competent institution should have recognised not 46 months, but 82 months of child-rearing, since the period during which she had reared her children in Belgium should be considered to be a substitute qualifying period, in accordance with Community law. The national Austrian legislation made a distinction between child-rearing periods spent in Austria and child-rearing periods spent in another country of the European Economic Area or the European Union. While the former were unconditionally treated as substitute periods for the purpose of old age insurance, the latter were treated as such only on two conditions: they must have been completed after 1 January 1994; and the applicant must be in receipt of, or have received, for the children concerned, cash maternity allowances or the equivalent allowances under federal Austrian law. Ms Kauer did not satisfy that condition as she had ceased her gainful occupation before the birth of her first child. The case also raised issues of applicability of Community law to Austria before the country joined the European Economic Area first, and the European Union later. The Court, after finding Community law to be applicable, answered the question of recognition of the child-rearing periods in another Member State positively. It held that the provisions of Austrian law, which establish different criteria for 14 15

Paragraph 22 of the judgment. Case C-28/00 [2002] ECR I-1343.

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The Aggregation Principle 207 recognition of child-rearing within the national territory and in another Member State, are liable to work to the disadvantage of Community nationals who, after having resided or worked in Austria, exercise their right ‘as workers, as members of a worker’s family or as Union citizens, to free movement and residence in the Member States, as guaranteed in Articles 8a, 48 and 52 of the EC Treaty (now, after amendment, Articles 18 EC, 39 EC and 43 EC)’ (emphasis added).16 This case, like the Elsen case, is not a typical one on aggregation, since the issue was not the aggregation of periods completed in another Member State with periods completed in the competent state. Ms Kauer had not completed any qualification periods in Belgium under Belgian law that could be aggregated with periods completed in Austria. The issue was whether periods (of child-rearing) completed in another Member State (Belgium) should be recognised as qualification periods under the legislation of the competent Member State (Austria). The cases could be discussed in relation to the exportability principle but they would not be more relevant to that principle than they are to the aggregation principle. Both cases also raised issues of determination of the applicable legislation, as was shown in the previous chapter. Both Elsen and Kauer are extremely interesting as they demonstrate the particular problems that may occur in the case of movement of female workers who devote a part of their lives to child-rearing, problems that perhaps cannot be analysed or solved on the basis of the traditional co-ordination principles. In this respect, the co-ordination system appears to be sorely inadequate. The new principle of assimilation of facts may be important in this respect. 17 c. Unemployment Benefits The aggregation provisions of chapter six of Title III concerning unemployment benefits are contained in Art 67 of Reg 1408/71. Article 67(1) provides that periods of insurance or employment completed as an ‘employed person’ under the legislation of any Member State are to be taken into account by the competent institution for the purpose of acquisition, retention or recovery of the right to unemployment benefits. The provision, as well as the entire chapter, obviously addresses employed people as defined by labour law at least in the first instance, as unemployment insurance for self-employed people is underdeveloped in most of the Member States. Article 67(3) lays down an important condition that has to be fulfilled in order for the aggregation principle to apply to the person concerned. Application of the aggregation principle is conditional upon the completion ‘lastly’, ie immediately before the claim to the benefits is made, of periods of insurance or employment in accordance with the provisions of the legislation under which the benefits are claimed.18 This territorial limitation has been criticised as being unnecessarily 16

Paragraph 44 of the judgment. Below, at IV. 18 See Cases C-272/90 van Noorden [1991] ECR I-2543; C-320/95 Alvite [1999] ECR I-0951; Joined Cases C-88/95, C-102/95 and C-103/95 Losada, Balado and Paredes [1997] ECR I-869. See also Case C62/91 Gray [1992] ECR I-2737. 17

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208 The Application of the Fundamental Principles of Co-ordination restrictive.19 Only the cases covered by Article 71(1)(a)(ii) and (b)(ii) are exempt from this requirement, ie when the person concerned can claim unemployment benefits in the Member State of residence. What does it mean to have ‘lastly’ completed periods of insurance or employment? What happens, for example, if a person becomes unemployed during or immediately after a period of work interruption? The case law contains one very interesting case in the application of the aggregation principle in circumstances relating to the subject matter of this book: the Bergemann case. The Bergemann case 20 This case concerned a Netherlands national, Ms Bergemann, who worked and resided in the Netherlands. On 5 June 1984 she married a German national and, the following day, transferred her residence to the home of her husband in Germany. Since the transfer of residence took place during a period of leave which lasted until the end of her employment relationship on 30 June 1984, Ms Bergemann did not return to the Netherlands to pursue her occupation there. As a result of the birth of her child on 6 August 1984, she did not immediately place herself at the disposal of the Employment Services in Germany. She registered as unemployed on 18 September 1984, after the expiry of her maternity leave. In the meantime, for the period between 15 July 1984 and 17 September 1984, she received a maternity allowance from the Netherlands sickness insurance fund. On 20 August 1984 Ms Bergemann applied to the German authorities for unemployment benefits. Her claim was rejected. Her appeal against the rejection decision was unsuccessful on the ground that she had never been employed in Germany and therefore had not completed the qualifying period required by the German legislation for the payment of unemployment benefits. The German legislation required pursuit of an occupation and payment of contributions for a minimum period of 360 days. The national court also stated that the periods of employment in the Netherlands could not be taken into account by the German authorities by virtue of the aggregation principle, since, under Art 67(3) of Reg 1408/71, the competent state with regard to unemployment benefits is the state of last employment, in this case the Netherlands. The national court nevertheless considered that Ms Bergemann’s situation might fall under one of the exception provisions. Thus, the question submitted to the Court of Justice by the national court was whether Ms Bergemann might possibly be entitled to rely on the exceptions provided for in Art 71(1)(a)(ii) or (b)(ii) of Reg 1408/71 in order to claim unemployment benefit from the authorities of the state of residence. These provisions make the legislation of the Member State of residence applicable, in other words they constitute exceptions to the lex loci laboris principle.21 The first question was therefore whether a worker who, in the course of her/his last employment, transfers residence to another Member State and, after that 19 20 21

See R White, EC Social Security Law (Essex, Longman, 1999), at 86. Case 236/87 [1988] ECR 5125. The provisions are discussed below, at II, 1.2 c ii.

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The Aggregation Principle 209 transfer, no longer returns to the state of employment in order to pursue an occupation there, can be regarded as a ‘frontier worker’ within the meaning of Articles 1(b)22 and 71(1)(a)(ii) of Reg 1408/71. The parties involved, as well as the Commission and the Advocate General, were of the view that such a worker could not be regarded as a ‘frontier worker’ within the meaning of these provisions. That question having been answered in the negative, the next question was whether a person in Ms Bergemann’s position qualified for the application of Art 71(1)(b)(ii). The case was finally judged on the basis of this provision, by elaborating on the notion of residence in particular. This issue is developed later in subsection II, 1.1 c ii. The point of interest here is that, according to the ruling of the Court, the institution of the Member State of residence, which was found to be the competent institution, would have to apply the aggregation principle on account of a person who was not actively in employment when the unemployment risk occurred. It was necessary to apply the aggregation principle, since the German legislation required pursuit of an occupation and payment of contributions for a minimum period of 360 days, conditions that had not been fulfilled by Ms Bergemann in Germany. It should be noted here that in all Member States, there are specific qualifying conditions for entitlement to benefits in the event of unemployment. In particular, immediately before becoming unemployed the claimant must have completed specific periods of insurance or employment.23 Thus, the aggregation principle was found to be applicable to a person who, prior to unemployment, had interrupted work (because of childbirth/child-rearing). It is impossible to tell from the case whether the amount of the benefit that could be claimed after the application of the aggregation principle was income-related or at the level of basic protection. d. Family Benefits24 The aggregation provision of chapter seven of Reg 1408/71 concerning family benefits is Art 72. The same questions as those posed with regard to the other aggregation provisions of Title III can also be posed with regard to Art 72. To whom does it apply? Does it apply to people interrupting work who fulfil the criterion of social security according to Art 1(a) of Reg 1408/71? Does it have a broader or a narrower meaning than Art 1(a)? There is no case law or other authority that provides an answer to this question. Pennings points out that the aggregation principle rarely applies because the 22 According to Art 1(b) of Reg 1408/71, ‘ “frontier worker” means any employed or self-employed person who pursues his occupation in the territory of a Member State and resides in the territory of another Member State to which he returns as a rule daily or at least once a week; however, a frontier worker who is posted elsewhere in the territory of the same or another Member State by the undertaking to which he is normally attached, or who engages in the provision of services elsewhere in the territory of the same or another Member State, shall retain the status of frontier worker for a period not exceeding four months, even if he is prevented, during that period, from returning daily or at least once a week to the place where he resides’. 23 See P Altmaier,‘Unemployment Benefits’ in European Commission (ed), Social Europe 3/92: Social Security for Persons Moving within the Community (Luxembourg, Office for the Official Publications of the European Communities, 1993), at 40. 24 As to the concept of ‘family benefits’, see below at 4.2. As to problems of classification between ‘family benefits’ and ‘maternity benefits’, see below at 4.3.

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210 The Application of the Fundamental Principles of Co-ordination majority of national schemes do not contain conditions as to the completion of periods of insurance in order to be entitled to these benefits.25 However, in cases where the family benefit at issue is income-related, such as the Swedish parental benefit for instance,26 the aggregation principle may be of the utmost importance. In this respect, Regulation 1408/71 reveals a considerable gap. Issues of determination of the applicable legislation may also be raised here. The gap in the co-ordination system was clearly demonstrated in several cases concerning the Swedish income-related parental benefit. The Öberg case27 involved a Swedish national who, after having worked as an official at the Court of Justice, returned to Sweden. While working for the Court he was affiliated to the Joint Sickness Insurance Scheme of the European Communities. Upon returning to Sweden, he applied for the income-related parental benefit. His application was rejected on the ground that, during the period prior to the birth of his child, he was not insured under the income-related Swedish scheme for at least 240 consecutive days immediately before the date of birth or due date of birth, according to the requirements of the national scheme. He was found to be eligible only to the much lower amount provided by the residence-based parental benefit. The dispute was not resolved on the basis of the co-ordination system, although the aggregation issue was a major one. It was resolved on the basis of the free movement provisions of the Treaty. The Court found that insurance requirements such as those included in the Swedish scheme constitute a barrier to the free movement of workers, which is prohibited by Article 39 EC.28 A new dimension, however, was added by the Court. It asked whether that barrier was capable of justification as pursuing a legitimate objective which is compatible with the Treaty and respects the principle of proportionality.29 The Swedish Government had argued that the restrictions on the benefits included in the scheme in the form of eligibility requirements were independent of the nationality of the people concerned and aiming at combating abuse as regards the application of the principle of aggregation of insured periods. Granting incomerelated amounts of parental benefit in such cases would place a considerable financial burden on the national social security scheme and would force it to reduce those amounts. The Court dismissed the argument as hypothetical. It held that considerations of a purely economic nature do not justify infringements of individual rights deriving from provisions of the Treaty enshrining the freedom of movement of workers.30

25 26 27 28 29 30

F Pennings, Introduction to European Social Security Law (The Hague, Kluwer, 2001), at 173. Below, at 4.3 b. Case C-185/04 [2006] ECR I-1453. See also Case C-137/04 Rockler [2006] ECR I-1441. Paragraph 17 of the judgment. Paragraphs 18 and 19 of the judgment. Paragraph 21 of the judgment.

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The Aggregation Principle 211 2. The Provisions of Reg 883/04 A general provision regarding aggregation has been inserted into Title I of Reg 883/04. Such a general provision was lacking in Reg 1408/71. 2.1 The Content of the Aggregation Principle According to Art 6, the competent institution of a Member State, whose legislation makes the acquisition, retention, duration or recovery of the right to benefits, coverage by legislation or access to or exemption from compulsory, optional continued or voluntary insurance, conditional upon the completion of periods of insurance, employment, self-employment or residence is, to the extent necessary, to take account of periods of insurance, employment, self-employment or residence completed under the legislation of any other Member State as though they were periods completed under the legislation to which it applies. The new element that has been added, in comparison with Reg 1408/71, is that the aggregation provision is made explicitly applicable to self-employed persons. Apart from this general article, specific articles concerning the same principle are included within the different chapters of Title III.31 Thus, inasmuch as it concerns the benefits examined here, specific aggregation provisions are included in chapter three concerning old age and survivors’ benefits (Art 42), and in chapter five concerning unemployment benefits (Art 61). 2.2 The Personal Scope of the Provisions concerning Aggregation The insertion of a general provision on aggregation in the first Title of Reg 883/04 must be understood as meaning that the principle is now applicable to all people covered by the Regulation. Besides, certain changes in terms of the personal scope of the aggregation provisions, as compared to the provisions of Reg 1408/71, emerge even from the specific provisions of Title III. The aggregation principle becomes, for instance, principally applicable to self-employed persons in Art 51.32 As regards unemployment benefits, the word ‘lastly’ is now replaced by the word ‘most recently’. Thus, the principle of aggregation applies when the person concerned has ‘most recently’ completed periods of insurance, employment or self-employment in the Member State where s/he claims benefits.33 3. Work Interruptions and the Application of the Aggregation Principle An attempt is made in this sub-section to assess the state of the law as regards the personal scope of the aggregation principle, from the perspective of people 31 32 33

Cf above n 1. In Reg 1408/71 there were several different provisions referring to the self-employed. Regulation 883/04, Art 61(2).

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212 The Application of the Fundamental Principles of Co-ordination interrupting work due to childbirth/child-rearing or migration, and to determine whether these provisions apply to such people. 3.1 Work Interruption because of Childbirth/Child-rearing With regard to Reg 1408/71, the first question is whether the provision establishing the aggregation principle when the benefits at issue are maternity benefits, ie Art 18(1) of Reg 1408/71, applies to people (women) interrupting work because of motherhood. Child-rearing benefits may also fall under chapter one and Art 18(1), depending on whether the concrete benefits are classified under the maternity branch of social security.34 There seem to be two answers to the question, and which applies depends upon the type of the benefits concerned. If they are employmentrelated, it would seem to be very difficult, if not impossible, to apply the aggregation principle. The law, however, is gravely underdeveloped in this area and relevant sources of law are almost completely lacking. It has received attention in the academic literature, but this too is limited. On the other hand, if the benefits are residence-related, the application of the aggregation principle to economically non-active people, and consequently even to people interrupting work because of maternity, is possible. The second question is whether the aggregation principle applies to people interrupting work because of child-rearing for the purpose of acquiring rights to old age benefits. The sources of law are very scarce even with regard to this issue. Those that exist reveal problems that cannot be solved on the basis of the aggregation principle. A particular problem concerning (female) workers having interrupted work because of childbirth/child-rearing is the recognition of periods devoted to child-rearing. Such periods may extend beyond the periods covered by the systems through relevant benefits and can consequently be problematic for the purpose of acquiring rights to old age benefits. Once again, the case law shows that such problems have so far been solved on the basis of the Treaty provisions concerning free movement not only for workers but also for all citizens of the Union. It seems to be possible to apply the aggregation principle to people having interrupted work because of childbirth/child-rearing for the purpose of acquiring rights to unemployment benefits. Such application is possible for the purpose of acquiring benefits in the Member State of new residence on the basis of Art 71(1)(b)(ii) of Reg 1408/71. This issue will be analysed later. Whether it is possible to apply the principle with the purpose of acquiring basic protection benefits or income-related benefits is not clear.35 As to the question of the application of the provisions concerning aggregation to people having interrupted work because of childbirth/child-rearing or migration when the benefits are family benefits, it is almost impossible to find an answer within the framework of the co-ordination system. Some recent cases, though, seem 34

See below, at 4.3. Unemployment benefits in some Member States, such as Sweden, are granted at two levels: a basic protection level and an income-related level. 35

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The Aggregation Principle 213 to be opening the way for acquiring employment- and income-related family benefits on the basis of European citizenship. Furthermore, by analogy with maternity benefits, the principle might perhaps be applicable where the benefits are residence-based. Regulation 883/04 seems at first sight to radically change the situation by making the aggregation principle applicable to all persons covered by the new Regulation. On the other hand, specific aggregation provisions in Title III refer explicitly to employed and self-employed persons. Thus, complications in the application of such provisions cannot be excluded, as the question will be whether persons interrupting work fall under the terms ‘employed’ or ‘self-employed’, and a conflict between Title I and Title III may occur. For reasons of legal certainty, therefore, clarification as to whether the principle applies to a specific category of employed people, namely those interrupting work for family reasons, would be useful. 3.2 Work Interruption because of Migration Interrupting work because of migration is not as such covered by any system and does not give rise to any benefits connected to the very reason of work interruption or to other social risks, in the same way as interrupting work for the reason of childrearing gives rise to a right to child-rearing benefits and perhaps even to other social security benefits, for instance old age benefits. Protection of workers interrupting work because of (family-related) migration is wholly dependent on whether their situation can be considered as unemployment, and they themselves as unemployed people. This raises issues of definition as to the terms ‘unemployment’ and ‘unemployed’. Provided that a person interrupting work because of (family-related) migration is regarded as an unemployed person (which presupposes the fulfilment of certain conditions), the state of law under Reg 1408/71 appears as follows: the aggregation principle concerning maternity benefits is to apply pursuant to Art 25(2) of Reg 1408/71; concerning old age benefits, it is to apply pursuant to Art 45(6); as regards unemployment benefits, Art 67 of Reg 1408/71 applies; and concerning family benefits, Art 72a is to apply. The application of the aggregation principle to unemployed persons is thus regulated in Reg 1408/71 with regard to all four branches of social security under examination in this chapter. The crucial point for people interrupting work as a consequence of migration, as already stated, is that they can formally be regarded as an unemployed person, which may be quite problematic. The insertion of a general aggregation provision in Reg 883/04 implies application of the principle to people falling within the category under examination. Complications may, however, occur concerning specific provisions according to what was said under the previous heading.

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214 The Application of the Fundamental Principles of Co-ordination

II. THE EXPORTABILITY PRINCIPLE

Apart from Art 42 of the Treaty, the exportability principle is entrenched in Art 10(1) of Reg 1408/71, as well as in Art 7 of Reg 883/04.

1. The Provisions of Reg 1408/71 Article 10(1) stipulates: [S]ave as otherwise provided in this Regulation invalidity, old age or survivors’ cash benefits, pensions for accidents at work or occupational diseases and death grants acquired under the legislation of one or more Member States shall not be subject to any reduction, modification, suspension, withdrawal or confiscation by reason of the fact that the recipient resides in the territory of a Member State other than that in which the institution responsible for payments is situated. The first subparagraph shall also apply to lump sum benefits granted in cases of remarriage of a surviving spouse who was entitled to a survivors’ pension.

Thus, the general exportability clause laid down in this article concerns only longterm benefits.36 Short-term benefits are not covered by the provision. The limits on the exportability of short-term benefits, most notably unemployment benefits, are considered justified as they relate to the legitimate interest of the paying state in facilitating a speedy return to work and in monitoring the job searching activities of the unemployed.37 White argues that these justifications may be valid in relation to sickness and unemployment benefits but there is less justification when maternity benefits are at issue.38 He thus classifies even family benefits as long-term benefits.39 Nevertheless, of the benefits discussed in this chapter, the general exportability clause of Art 10(1) covers only old age benefits. As for the remaining benefits, ie sickness and maternity, unemployment and family benefits, there are specific 36 According to the Court, the principle laid down in this provision means not only that the person concerned maintains her/his right to an acquired benefit after having moved to another Member State, but also that s/he cannot be deprived of her/his right to acquire a benefit in the Member State under whose legislation the benefit is payable on the ground that s/he does not reside in that Member State (Case C-92/81 Caracciolo [1982] ECR 2213; Joined Cases 379, 380, 381/85 and 93/86 Giletti, Giardini, Tampan and Severini [1987] ECR 955). 37 Pieters points out that the restrictions on the retention of unemployment rights acquired were inspired by the fear of abuse. It was feared that unemployed people in states with relatively good unemployment benefits would go to ‘look for work’ in poorer but sunnier regions, where the chance of actually finding a job was considered to be minimal. Opponents of the present restrictions, on the other hand, argue that the free movement rights should not only benefit the capitalist entrepreneurs and people with a job, but should also allow unemployed people to benefit from the opportunities offered by an integrated labour market. See D Pieters, ‘Towards a Radical Simpification of Social Security Coordination’ in Swedish National Social Insurance Board and European Commission (eds), 25 Years of Regulation (EEC) No 1408/71 on Social Security for Migrant Workers—A Conference Report (Stockholm, 1997), at 183. 38 R White, above n 19, at 67–68. 39 Ibid, at 103.

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The Exportability Principle 215 provisions within the framework of each relevant chapter of Title III. These provisions regulate the award of benefits in a Member State other than the competent one. They can thus be seen as establishing a sort of exportability, although it is not exportability in the classical meaning of the word, ie the worker takes with her/him the benefits acquired in another Member State. It should be added here that special non-contributory benefits, covered by the Regulation pursuant to Art 4(2a),40 are explicitly excluded from the exportability principle. According to Art 10a(1) of Reg 1408/71,41 such benefits are to be granted exclusively in the territory of the Member State of residence in accordance with the legislation of that state, provided that such benefits are listed in Annex IIa. Several sorts of family benefits are listed in Annex IIa as being special non-contributory benefits which are excluded from the exportability principle.42 The Annex was recently amended, however, in order to adjust Reg 1408/71 to case law developments.43 The special non-contributory benefits, however, will continue in principle to be excluded from the exportability principle. This exemption of the special noncontributory benefits from the exportability principle is an important exception from the point of view of the people interrupting work because of childbirth/childrearing, since many special non-contributory benefits are related to the maternity and family branches of social security. The content of the specific exportability provisions in the chapters of Title III will be described as briefly as possible in the following pages. The exportability provisions concern an extended area of Community law of co-ordination in which many developments have occurred. It is beyond the scope of this book to give an extensive analysis of the provisions; however, some description of their content is necessary here. Consequently, before examining the personal scope of the provisions, especially whether they apply to people interrupting work because of childbirth/child-rearing or migration, the focus will be on the specific meaning of the exportability principle within the framework of the different chapters of Title III. 1.1 The Content of the Exportability Principle concerning Specific Benefits Specific exportability provisions are included in chapter one of Title III concerning sickness/maternity benefits, chapter six concerning unemployment benefits, and chapter seven concerning family benefits. a. Sickness/Maternity Benefits The exportability of sickness/maternity benefits is established in Articles 19 and 22 of Reg 1408/71. Article 19 concerns the provision 40

Above, ch 4 at I, 1.1 a ii. After its last amendment by Reg 647/2005 ([2005] OJ L117/1). Member States have made extensive use of this provision and have enumerated many benefits in the Annex; see Y Jorens and B Schulte,‘The Implementation of Regulation 1408/71 in the Member States of the European Union’ (2001) 3 European Journal of Social Security 237, at 244. See also R White, above n 19, at 68 et seq. 43 The amendment made by Reg 647/2005 meant that the classification of some benefits as special non-contributory benefits was changed. For example, the Luxembourg maternity allowance, formerly listed in Annex IIa, was found by the Court not to be a special non-contributory benefit (Case C-43/99 Leclere [2001] ECR I-4265), and it has been deleted from the Annex. 41 42

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216 The Application of the Fundamental Principles of Co-ordination of benefits when the beneficiary resides in a Member State other than the competent one.44 Article 22 of Reg 1408/71 concerns the provision of benefits when the beneficiary is staying in a Member State other than the competent one.45 The exportability envisaged in these provisions is a limited form of exportability, in the sense that it is subject to conditions. For example, the export of benefits in the case of a stay in another Member State is only possible upon the satisfaction of conditions of emergency or authorisation. Some authors consider that the limitations on the exportability of maternity benefits in particular are not justified, since the justification for imposing limitations on the export of short-term benefits relates to the interest of the paying state in facilitating a speedy return to work. This justification ought to be less valid in the case of maternity benefits, it has been argued.46 Significant changes have recently taken place in this area, however, as discussed below. i. Residence in a Member State Other than the Competent State According to Art 19, when an employed or self-employed person who satisfies the conditions of the legislation of the competent state for entitlement to benefits resides in another Member State, s/he shall receive benefits as follows: — S/he is to receive benefits in kind in the Member State of residence, provided on behalf of the competent institution by the institution of the place of residence in accordance with the provisions of the legislation administered by that institution as though s/he were insured with it.47 — S/he is to receive cash benefits in the place of residence by the competent institution in accordance with the legislation that it administers. However, by agreement between the competent institution and the institution of the place of residence, such benefits may be provided by the latter institution on behalf of the former, in accordance with the legislation of the competent state.48 A distinction between benefits in kind and benefits in cash is obviously of particular importance for the application of this provision. Regulation 1408/71 does not give 44 The competent state is usually the state of employment. However, it can be a state other than the state of employment, for instance the state assigned by an Agreement according to Art 17 (Case C-454/93 Van Gestel [1995] ECR I-1707). 45 According to Art 1(h) of Reg 1408/71, ‘residence’ means habitual residence. According to Art 1(i), ‘stay’ means temporary residence. 46 R White, above n 19, at 67–68. 47 Regulation 1408/71, Art 19(1)(a). For an interpretation of the concept ‘benefits in kind’ in this provision and in other provisions of Reg 1408/71, see Decision No 175 (00/142/EC) of 23 June 1999 of the Administrative Commission ([2000] OJ L47/32). 48 Ibid, Art 19(1)(b). The Member State of residence is responsible for medical examinations and necessary administrative checks. The institution of the place of residence must send the results to the competent institution of the Member State of employment. This has raised questions as to whether the institution of the competent Member State is bound by examinations carried out in the state of residence (Case 22/86 Rindone [1987] ECR 1339; Case C-45/90 Paletta [1992] ECR I-3423 concerning the situation where the employer is under an obligation to pay sickness benefit). Another issue is the treatment of corresponding facts occurring in another Member State as equivalent to facts which, if occurring within national territory, constitute a ground for the loss or suspension of the right to cash benefits. The Court has ruled that the national authorities are not prohibited from taking into account such facts and consequently suspending the export of cash benefits (Case 1/78 Kenny [1978] ECR 1489).

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The Exportability Principle 217 a definition of these terms—a lack that has led to significant case law. The Court has taken the view that the term ‘benefits in kind’ does not exclude the possibility that such benefits may comprise payments made by the debtor institution in the form of direct payments or the reimbursement of expenses. It has also held that ‘cash benefits’ are essentially those designed to compensate for a worker’s loss of earnings through illness.49 As to the social risk of maternity, medical and hospital care are usually regarded as maternity benefits in kind while maternity/parental leave benefit and birth grants are usually regarded as benefits in cash.50 A specific provision in chapter one refers to frontier workers,51 while Art 21 contains several specific rules. ii. Stay Outside the Competent State Article 22 of Reg 1408/71 contains the rules on the entitlement to benefits of an employed or self-employed person who satisfies the conditions of the legislation of the competent state and who temporarily stays abroad. Benefits are paid in three cases: when the condition of the person concerned requires benefits in kind which become necessary on medical grounds during a stay in the territory of another Member State, taking into account the nature of the benefits and the expected length of the stay;52 when, having become entitled to benefits chargeable to the competent institution, the person concerned is authorised by that institution to return to the territory of the Member State where s/he resides, or to transfer her/his residence to the territory of another Member State;53 and finally, when the person concerned is authorised by the competent institution to go to the territory of another Member State to receive there the treatment appropriate to her/his condition.54 A person in one of these situations is entitled to: 49 Case 61/65 Vaassen-Goebbels [1966] ECR 261. See also Case 33/65 Dekker [1965] ECR 901. In the Molenaar case (C-160/96 [1998] ECR I-843) the Court held nonetheless that a care allowance, designed to cover certain costs entailed by reliance on care rather than to compensate for loss of earnings on the part of the recipient, should nevertheless be regarded as a cash benefit since it was periodical, at a fixed amount and recipients were to a large extent unfettered in their use of the sums allocated to them. However, according to Decision No 175 of the Administrative Commission (above n 47), care insurance benefits are to be considered as benefits in kind. In general, according to this decision, benefits in kind for the purpose of the application of Art 19 are those benefits regarded as such by the institution providing them. 50 See below, at 4.1 a. 51 Regulation 1408/71, Art 20. 52 Article 22(1)(a) of Reg 1408/71 after its last amendment by Reg 631/2004 ([2004] OJ L100/1). According to Art 22(1a), inserted by the same amending regulation, the Administrative Commission is to establish a list of benefits in kind which, in order to be provided during a stay in another Member State, require, for practical reasons, prior agreement between the person concerned and the institution providing the care. Furthermore, pursuant to Art 22c, inserted into Reg 1408/71 by the amending Reg 1290/97 ([1997] OJ L176/1), a person, as referred to in Art 22(1) and (3) and in Art 22a, who ‘stays in a Member State other than the competent State to study there or receive vocational training leading to a qualification officially recognised by the authorities of a Member State, and the members of his family accompanying him during his stay, shall be covered by the provisions of Art 22(1)(a) for any condition necessitating benefits during the stay in the territory of the Member State where such person is studying or in training’. 53 Regulation 1408/71, Art 22(1)(b). Such situations often occur in cases of migrant workers falling ill and who will not presumably recover quickly and want, therefore, to recover in their state of origin. See F Pennings, above n 25, at 145. 54 Ibid, Art 22(1)(c).

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218 The Application of the Fundamental Principles of Co-ordination (a) benefits in kind, provided on behalf of the competent institution by the institution of the place of stay or residence in accordance with the provisions of the legislation which it administers, as though s/he were insured with it. The length of the period during which benefits are provided shall be governed, however, by the legislation of the competent state;55 (b) cash benefits provided by the competent institution in accordance with the provisions of the legislation which it administers. The competent institution and the institution of the place of stay or residence may conclude an agreement, on the basis of which such benefits are to be provided by the latter institution on behalf of the former, in accordance with the provisions of the legislation of the competent state.56 The distinction between benefits in kind and benefits in cash is obviously important even in the context of this article.57 In cases where authorisation is required, such authorisation may be refused only if it is established that movement of the person concerned would be prejudicial to her/his state of health or her/his receipt of medical treatment.58 In contrast, authorisation may not be refused where the treatment in question is among the benefits provided for by the legislation of the Member State on whose territory the person concerned resides but s/he cannot be given such treatment within the time normally necessary for obtaining the treatment in question in the Member State of residence, taking account of her/his current state of health and the probable course of the disease.59 The provisions of Art 22(1) have been subject to very extensive and generous interpretation by the Court of Justice in cases referring to sickness benefits.60 No cases specifically concerning maternity benefits exist, however.61 The Administrative Commission has decided that health care services in conjunction with pregnancy or childbirth commencing before the start of the 38th week of pregnancy and provided in a Member State other than the competent state or the Member State of residence for a person who is covered by the provisions of Art 22(1)(a) are to be considered as being care that is immediately necessary, provided the reasons for the stay are other than medical ones. The decision was motivated, on the one hand, by the need to give not too narrow an interpretation to Art 22(1)(a) which would appreciably restrict the freedom of movement of pregnant women, and on the other hand, by the need to prevent all unreasonable exploitation of the provi55

Regulation 1408/71, Art 22(1)(a)(b)(c)(i). Ibid, Art 22(1)(a)(b)(c)(ii). See also the Paletta cases, ie Case C-45/90 [1992] ECR I-3423 and C-206/24 [1996] ECR I-2357. 57 See also ibid, Art 22b, inserted by Reg 3095/95 ([1995] OJ L335/1), which concerns the application of Art 22(1)(a) to certain categories of employed or self-employed people, or in certain situations. 58 Ibid, Art 22(2) first para. 59 Ibid, Art 22(2) second para. 60 Above, ch 4 nn 52 and 54. See also Case C-326/00 Ioannidis [2003] ECR I-1703, concerning Art 31 of Reg 1408/71 which refers to pensioners. The Court took the view that an illness did not have to have manifest itself particularly suddenly during a stay in another Member State to justify an immediate admission to hospital—it could be a chronic illness; and Case C- 156/01 van der Duin [2003] ECR I-10087 concerning the institution competent to issue authorisation. 61 The Kuusijärvi case was brought to the Court for an interpretation of Art 22, but was eventually judged on the basis of Articles 73 and 74. 56

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The Exportability Principle 219 sions of the same article by pregnant women who temporarily move to another Member State with the intention of obtaining pregnancy-related benefits in kind.62 After the insertion of Art 22a into Reg 1408/71,63 the provisions of Art 22(1)(a), (c) and (1a) now apply to all people who are nationals of Member States and are insured under the legislation of a Member State, even those who could not be regarded as employed or self-employed persons. This was the first extension of Reg 1408/71 to embrace persons beyond employment.64 Those parts of Reg 1408/71 dealing with the provision of care during a temporary stay abroad were amended by Reg 631/2004.65 The main trait of the amendment was that the rights of all insured people in respect of access to benefits in kind during a temporary stay in another Member State were brought into line, as opposed to the previous fragmented system where different categories of people were entitled to benefits under different conditions. Through amendments to the implementing Reg 574/72, a European Health Insurance Card was introduced to replace the different forms of certificate that were formerly issued by the competent authorities. b. Old Age Benefits Old age benefits, as already stated,66 are covered by the general exportability provision of Art 10(1) of Reg 1408/71. Chapter three contains no provisions specifying or modifying the content of the exportability principle with regard to old age benefits. Benefits that are defined as old age benefits can thus follow an employed or self-employed person when s/he moves from the competent Member State to another Member State. c. Unemployment Benefits The central provision of chapter six, which concerns the exportability of unemployment benefits, is Art 69 of Reg 1408/71. It is also necessary to outline Art 71, however, in order to understand the entire complex system of receiving unemployment benefits in another Member State. i. Article 69 of Reg 1408/71 An unemployed person who satisfies the conditions laid down in Art 69 and who goes to seek work in another Member State is entitled, pursuant to this article, to unemployment benefits for a maximum period of three 62 See Decision No 183 (02/155/EC) of 27 June 2001 of the Administrative Commission ([2002] OJ L54/39). 63 By Reg 3095/95 ([1995] OJ L335/1). The provision was last amended by Reg 631/2004 ([2004] OJ L100/1). 64 See Decision No 174 (00/141/EC) of the Administrative Commission ([2000] OJ L47/30) concerning the interpretation of Art 22a. According to this Decision, the words ‘insured under the legislation of a Member State’ are to be understood as including any person who is a national of a Member State and entitled to sickness benefits in kind under the legislation of a Member State by virtue of insurance on a voluntary, compulsory or optional continued basis on other grounds than as an employed or self-employed person for one or more of the contingencies covered by the branches of social security dealt with in Reg 1408/71. It is also to mean any person, who is a national of a Member State, covered by the legislation of a Member State that provides for sickness benefits in kind on other grounds than insurance of the abovementioned kind and excluding beneficiaries whose rights to sickness benefits in kind derive solely from social and medical assistance schemes or schemes for victims of war or its consequences. 65 [2004] OJ L100/1. 66 Above, at 1.

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220 The Application of the Fundamental Principles of Co-ordination months from the date when the person concerned ceased to be available to the employment services of the state which s/he left, provided that the total duration of the benefits does not exceed the duration of the period of benefits s/he was entitled to under the legislation of that state.67 The conditions laid down in Art 69 for the right to export the benefits are conditions of registration. According to Art 69(1)(a) of Reg 1408/71, an employed or self-employed person who is wholly unemployed, who satisfies the conditions of the legislation of a Member State for entitlement to unemployment benefits and who goes to one or more other Member States in order to seek employment there, shall retain entitlement to the benefits if, before her/his departure, s/he registers as a person seeking work and remains available to the employment services of the competent state for at least four weeks after becoming unemployed. The competent services or institutions, however, may authorise her/his departure before such time has expired. The requirement of remaining available to the employment services of the competent state for four weeks does not concern unemployed people accompanying their spouses. The Administrative Commission has recommended the competent services or institutions of Member States to grant authorisation of departure before the four weeks have expired to employed or self-employed persons who are wholly unemployed, meet all the other conditions laid down in Art 69(1), and are accompanying their spouses who have taken a job in a Member State other than the competent state.68 In addition, the person concerned must register as a person seeking work with the employment services of each of the Member States to which s/he goes, and be subject to the control procedure organised therein. This condition has to be satisfied within seven days of the date when s/he ceased to be available to the employment services of the state s/he left, but this period may, exceptionally, be extended.69 The Court has held that the requirements of registration are not in conflict with Art 42 of the Treaty and they do not impede freedom of movement for workers.70 67 According to Art 69(2) of Reg 1408/71, if the person concerned returns to the competent state before the expiry of the three-month period, s/he shall continue to be entitled to benefits under the legislation of that state. S/he loses all entitlement to benefits under the legislation of the competent state if s/he does not return before the expiry of that period. See also Cases 192/87 Vanhaeren [1988] ECR 2411; C-163/89 Di Conti [1990] ECR I-1829; C-170/95 Spataro [1996] ECR I-2921; Joint Cases 41/79, 121/79 and 796/79 Testa, Maggio and Vitale [1980] ECR 1979. 68 Recommendation No 21 of 28 November 1996 ([1997] OJ C67/3). 69 Regulation 1408/71, Art 69(1)(b). 70 Case C-62/91 Gray [1992] ECR I-2737. The case concerned a British national who, after having worked in the United Kingdom, settled with his wife on Grand Canary Island, where he worked as manager of a restaurant owned by his wife for almost 19 years. Before returning to the United Kingdom, Mr Gray did not register in Spain as a person seeking work. After his return to the United Kingdom, he claimed unemployment benefits. His application was refused on the ground that, since he had not completed his last period of insurance in the United Kingdom and had not registered himself as a person seeking work in Spain prior to returning to the United Kingdom, he could not avail himself of the applicable provisions of Reg 1408/71 (ie Art 67 or Art 69). The Court agreed with this interpretation. It emphasised that Reg 1408/71 confers on unemployed migrant workers rights which they would not otherwise enjoy and which help to ensure freedom of movement. The attachment of conditions to these rights and advantages, in the Court’s opinion, are a ‘proper use’ of the discretion that the Community legislature has in implementing freedom of movement for workers.

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The Exportability Principle 221 Article 69 is intended solely to guarantee for the migrant worker the limited and conditional preservation of the unemployment benefits of the competent state, even if s/he goes to another Member State. It does not affect a person’s right to be entitled to unemployment benefits under the legislation of the other Member State. Thus, that Member State cannot rely on the mere failure to comply with the conditions prescribed under Art 69 of Reg 1408/71 in order to deny the worker entitlement to unemployment benefit, which s/he may claim under the national legislation of that state.71 The three-month limit72 has been criticised for being too short and ill adapted to the needs of an unemployed person seeking work abroad. Pieters finds the present provision to be a compromise between two different approaches, one fearing abuse of exportability and the other arguing for an unlimited right to it,73 and as a result it lacks consistency. He argues that the present condition of having to return within three months should be abolished and replaced by full exportability of the benefits but with better guidance from the competent institution.74 An extension of the time period was contained in the proposal for the simplification of Reg 1408/71. According to Art 50(1)(d) of the proposal, entitlement to benefits would be retained for a maximum period of six months from the date the unemployed person ceased to be available to the employment services of the state which he left, provided that the total duration for which the benefits were granted did not exceed the duration of the period of benefits s/he was entitled to pursuant to the legislation of that state.75 That extension was not however accepted by the European Council, and Reg 883/04 eventually provided for maintaining the current three-month period with a possibility of extension to six months. Article 69 applies in cases where the person in question worked and resided in the same Member State during his/her last employment. The competent institution in that case is the institution of that Member State. However, where the person in question did not reside in the Member State where s/he last worked, the situation may be somewhat confusing with regard to the determination of the competent Member State. Article 71 contains rules for the determination of the Member State that is to provide the benefits. 71

Consequently, the Italian workers who returned to Italy where they claimed unemployment benefits under Italian law, after having become unemployed in Germany, could not be refused the benefit on the sole ground that they had not complied with the provisions of Art 69, in that inter alia they returned to Italy before the expiry of the period of four weeks prescribed therein (Case 27/75 Bonaffini [1975] ECR 971). 72 In exceptional cases, this time limit may be extended by the competent services or institutions. The competent services and institutions of the Member States enjoy a wide discretion in deciding whether to extend the three-month period. In exercising that discretionary power, however, they must take account of the principle of proportionality. In order to apply that principle correctly, the competent services and institutions must take into account, in each individual case, the extent to which the period in question has been exceeded, the reason for the delay in returning, and the seriousness of the legal consequences arising from such delay (Joined Cases 41/79, 121/79 and 796/79 Testa, Maggio and Vitale [1980] ECR 1979). 73 D Pieters, above n 37. 74 Ibid, at 183. 75 COM (98) 779 final.

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222 The Application of the Fundamental Principles of Co-ordination ii. Article 71 of Reg 1408/71 and the Concept of Residence As mentioned earlier, Art 71 contains the rules on entitlement to unemployment benefits of unemployed persons who, during their last employment, were residing in a Member State other than the competent state.76 The Court has ruled that the provisions of Art 71 constitute exceptions to the rules of Art 67 and 69 and as such they should be interpreted strictly.77 The provisions of the Article are very complicated, as different rules apply to different categories of unemployed people. A distinction is made first between frontier workers and employed people other than frontier workers who become unemployed. Frontier workers are further distinguished in terms of those who are partially or intermittently unemployed in the undertaking employing them, and those who are wholly unemployed. The former are to receive benefits in accordance with the legislation of the Member State of (last) employment, the latter in accordance with the Member State of residence. The benefits are to be provided by the institution of the place of residence at its own expense.78 The Court of Justice has held that in order to determine whether a frontier worker is to be regarded as partially unemployed or wholly unemployed within the meaning of Art 71(1)(a) of Reg 1408/71, uniform Community criteria must be applied. That assessment may not be made on the basis of criteria drawn from national law.79 Although it introduces a derogation by virtue of which a wholly unemployed frontier worker receives unemployment benefits in the state of residence as though that state were the state where s/he was last employed,80 Art 71 does not affect the basic principle that the competent state for unemployed workers is the state of last employment (the lex loci laboris principle). The latter’s obligations are in fact merely suspended for as long as the unemployed worker lives in another Member State, so that where the person concerned, after receiving unemployment benefit in the state in which s/he is resident, settles in the Member State in which s/he was last employed, the latter must begin or begin afresh to assume its obligations under the Regulation in relation to unemployment benefit.81 Employed people other than frontier workers are also placed in one of two categories. The first consists of those who are partially, intermittently or wholly unemployed and remain available to their employer or to the employment services in the territory of the competent state. They are to receive benefits in accordance with the provisions of the legislation of that state.82 The other category consists of people who are wholly unemployed and who make themselves available for work to 76

See Cases 128/83 Guyot [1984] ECR 3507; C-454/93 Van Gestel [1995] ECR I-1707. Case 76/76 di Paolo [1977] ECR 315, in particular paras 12 and 13. Regulation 1408/71, Art 71(1)(a)(i) and (ii). 79 Case C-444/98 de Laat [2001] ECR I-2229. 80 Pennings comments that for frontier workers wishing to be available to the employment services in the state of employment, this rule is unsatisfactory as it implies that these people are deprived of the rights they acquired by virtue of the legislation of the state of employment; see F Pennings, above n 25, at 196. See also Case 1/85 Miethe [1986] ECR 1837. 81 Case C-131/95 Huijbrechts [1997] ECR I-1409. 82 Article 71(1)(b)(i) of the Regulation. See also Case C-308/94 Naruschawicus [1996] ECR I-0207. 77 78

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The Exportability Principle 223 the employment services in the territory of the Member State in which they reside. They are to receive benefits in accordance with the legislation of the Member State of residence as if they had last been employed there (Art 71(1)(b)(ii) of Reg 1408/71). The institution of the place of residence is to provide such benefits at its own expense.83 Significant for the application of Art 71 and for the analysis here is the concept of residence. As was seen above, the necessary condition for the application of Art 71 is that a person is residing in a Member State other than the state of last employment. How, then, is the concept of residence defined within this context? And in particular, how is it to be defined within a context of family-related migration? As to the first question, the Court held that ‘Member State of residence’, especially for the purposes of the application of Art 71(1)(b)(ii), should be understood only as the state in which the worker, although employed in another Member State, continues habitually to reside and where the habitual centre of her/his interests is also situated. Account should be taken of the length and continuity of residence before the person concerned moved, the length and purpose of any absence, the nature of the occupation found in another Member State and the intention of the person concerned as it appears from all the circumstances. In the Di Paolo case84 the Court held that the fact that a worker has left her/his family in a Member State constitutes evidence that s/he has retained residence there, but it is not of itself sufficient to allow her/him the benefit of the exception laid down in Art 71(1)(b)(ii). In fact, whenever a worker has stable employment in a Member State there is a presumption that s/he resides there, even if s/he has left family in another state. Accordingly, it is not only the worker’s family situation that is to be taken into account; account should also be taken of the reasons that led to the move as well as the nature of the work.85 As to the second question, the determination of the place of residence for the purpose of the application of Art 71(1)(b)(ii) in case in which a person moves to another Member State for family reasons may be even more problematic, as was shown in the Bergemann case.86 The relevant question raised was whether Ms Bergemann could be considered to be a resident in Germany, against the background of the fact that she had transferred her residence to that country only a short time before applying for unemployment benefits. The following discussion revolves around the problems and arguments put forward with regard to this issue. Elaborating the notion of ‘residence’, the Advocate General underlined that, in order to determine whether the newly established home, shared with a husband, meets the conditions laid down in respect of ‘residence’, it is necessary to take into 83

The reason for making the legislation of the place of residence applicable is to ensure that a worker may receive unemployment benefits in the most favourable conditions to the search for new employment. See Case 39/76 Mouthaan [1976] ECR 1901, para 13. 84 Case 76/76 [1977] ECR 0315. 85 Paragraphs 18–20 of the judgment. See also Cases 66/77 Kuyken [1977] ECR 2311; C-216/89 Reibold [1990] ECR I-4163; C-102/91 Knoch [1992] ECR I-4341; C-454/93 Van Gestel [1995] ECR I-1707. 86 Above at I, 1,2 c.

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224 The Application of the Fundamental Principles of Co-ordination account the reasons behind the change of residence. In this respect, the Advocate General emphasised that a transfer of residence in pursuit of a whim, of a purely arbitrary nature or conceivably motivated in part by economic considerations cannot come within the scope of Art 71(1)(b)(ii). In fact Art 71 requires close personal ties to the place of residence.87 The Advocate General considered that such personal ties existed in the case at issue. He based this view on the ‘considerable protection’ that marriage and the family enjoy, both at the international level and within the legal systems of the Member States. This protection, according to the Advocate General, comprises inter alia the unity of the family and life together, and the legal, economic and social protection of the family, including recognition of the right to unemployment benefits for an employee who gives up employment in order to live with their spouse or to be able to continue living together in most Member States.88 Thus, despite the fact that the facts of the case at issue were actually contrary to the facts of the Di Paolo case,89 the condition of residence was nevertheless satisfied.90 Against this backdrop of protecting the family and family life, the Advocate General expressed the view that the setting-up of a family home in a Member State other than the previous state of residence amounts to ‘residing’ within the meaning of Art 71 of Reg 1408/71. The decisive factor in this respect is whether the person concerned has actually taken up residence, so that even a relatively short period may satisfy this requirement.91 In its judgment, the Court held that the possibility of receiving unemployment benefit in the state of residence is justified for certain categories of workers who establish close ties, in particular of a personal and vocational nature, with the country where they have settled and habitually reside. It is reasonable that workers who have such links with the state in which they reside should be accorded the best conditions in that state for finding new employment. The Court concluded that in the light of these considerations, Art 71(1)(b)(ii) must be regarded as being applicable to a case of a worker who has transferred residence to a state other than the state of employment for family reasons, namely, the wish to live with a spouse and child. In such circumstances, the Court held that there can be no doubt that she can enjoy in the state of residence, rather than in the state of employment, more favourable conditions for obtaining new employment.92 The state of the law is thus quite beneficial to people moving to another Member State for family reasons. They can claim unemployment benefit in the Member State of their new residence, even if they have never been employed there, and even if their period of residence in the new country has up to that point been short. 87

Paragraph 26 of the Opinion of the Advocate General. Ibid, paras 27–36. The Di Paolo case (76/76 [1977] ECR 315) was about returning to the country of residence; the Bergemann case (236/87 [1988] ECR 5125) was about moving to a new state to take up residence there. 90 Paragraph 25 of the Opinion of the Advocate General. 91 Ibid, para 37. 92 Paragraphs 20–21 of the judgment. 88 89

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The Exportability Principle 225 d. Family Benefits The provisions of chapter seven of Title III that are associated with the exportability of family benefits are Articles 73 and 75(1). According to Art 73: [A]n employed or self-employed person subject to the legislation of a Member State shall be entitled, in respect of the members of his family who are residing in another Member State, to the family benefits provided for by the legislation of the former State, as if they were residing in that State, subject to the provisions of Annex VI.93

According to Art 75(1): [F]amily benefits shall be provided, in the cases referred to in Article 73, by the competent institution of the State to the legislation of which the employed or self-employed person is subject and, in the case referred to in Article 74, by the competent institution of the State under the legislation of which an unemployed person who was formerly employed or selfemployed receives unemployment benefits. They shall be provided in accordance with the provisions administered by such institutions, whether or not the natural or legal person to whom such benefits are payable is residing or staying in the territory of the competent State or in that of another Member State.

According to Art 75(2), if the family benefits are not used by the person to whom they should be provided for the maintenance of family members, the competent institution is to be discharged of its legal obligations by providing said benefits to the natural or legal person actually maintaining the family members at the request of, and through the agency of, the institution of their place of residence or of the designated institution or body appointed for this purpose by the competent authority of the country of their residence. Consequently, the exportability of family benefits presupposes the residence of family members, on whose behalf the benefits are provided, in a Member State other than the competent one. If this condition is fulfilled, the benefits are paid to the beneficiary whether or not s/he resides or stays in the territory of the competent Member State or in that of the Member State of residence of the family members.94 Since the residence of family members is of crucial importance, many problems that have emerged over the years concern the residence of family members within the meaning of Art 73. For this reason, this article deserves further attention. The Court emphasised that the purpose of Art 73 is to prevent a Member State from being able to refuse to grant family benefits by reason of the fact that a family member does not reside in the Member State providing the benefits. Such refusal would have a deterrent effect on the free movement of workers.95 93 Annex VI, as last amended by Reg 647/05, refers to special procedures for applying the legislation of certain Member States concerning, in the case of some Member States, even family benefits. 94 See also Cases 1/88 Baldi [1989] ECR 0667; C-394/93 Alonso-Pérez [1995] ECR I-4101. Article 73 cannot be defeated by reference to tax legislation requiring residence of the member of the family in the national territory of the competent Member State (Case C-321/93 Imbernon-Martinez [1995] ECR I2821). 95 Case C-228/88 Bronzino [1990] ECR I-531. The Court held in that particular case that if entitlement to certain family benefits is conditional upon the registration of the child of the worker as unemployed with the employment office of the Member State providing the benefits, a condition which

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226 The Application of the Fundamental Principles of Co-ordination The entitlement to family allowances on the basis of Art 73 cannot be defeated by a provision of the applicable national legislation, by virtue of which people not residing in the territory of the Member State are not to receive family allowances. That was laid down in the Brusse case.96 The case concerned a Netherlands national who, after working in the Netherlands, went to live and work in the United Kingdom. However, he was never affiliated to the United Kingdom social security scheme and continued to pay voluntary contributions to the Netherlands scheme. When the irregularity of his situation was discovered, the relevant United Kingdom and Netherlands authorities decided to conclude an agreement,97 according to which he was to be regarded as subject to the Netherlands social security scheme for the period ending the year the irregularity was discovered. After that period, the United Kingdom legislation was to apply to him. On the basis of that agreement, the competent Netherlands social security authority was asked to pay him family allowances in accordance with the Netherlands legislation for the period in respect of which it had been agreed that that legislation would apply to him. The Netherlands authority rejected the request on the basis that the Netherlands legislation provides for payment of family allowances only to workers residing in the Netherlands. Mr Brusse did not fulfil this condition during the relevant period. The Court, however, was of the view that the provision of Art 73(1) creates in favour of a worker, whose family members reside in the territory of another Member State, a real entitlement to the family allowances provided for by the applicable legislation, and that entitlement can be defeated by a residence condition in the applicable legislation.98 Article 75(1) was not discussed. The above discussion outlined the general principles arising with respect to the content of the exportability principle concerning sickness/maternity benefits, old age benefits, unemployment benefits and family benefits. Our focus will now turn to the personal scope of the pertinent provisions of Title III. 1.2 The Personal Scope of the Specific Exportability Provisions of Title III The importance of the active pursuit of an economic activity is the particular point of interest for this book in discussing the personal scope of the selected specific provisions of Title III concerning exportability. can be fulfilled only if the child resides within the territory of that state, that condition must be considered to be fulfilled where the child is registered as unemployed with the employment office of the Member State in which s/he resides. See also Case C-12/89 Gatto [1990] ECR I-557. The case referred to Art 74 of Reg 1408/71. 96 Case 101/83 [1984] ECR 2223. 97 Pursuant to Art 17 of Reg 1408/71. 98 Cf the statement of the Court in the Garcia case (C-266/95 [1997] ECR I-3279), according to which Art 73 does not itself confer any entitlement to family benefits, but is merely intended to prevent Member States from making entitlement to, or the amount of, family benefits subject to the requirement that members of the worker’s family reside in the Member State providing the benefits. Such requirements would deter Community workers from exercising their right to freedom of movement. See also Case 104/80 Beeck [1981] ECR 503.

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The Exportability Principle 227 a. Sickness/Maternity Benefits The exportability provisions within the framework of chapter one of Title III of Reg 1408/71 are, as mentioned above, found in Articles 19 and 22. Article 19 makes explicit reference to the persons to whom it applies: employed or self-employed persons. Is the concept of ‘employed or self-employed person’ in the meaning of this provision to be understood in the light of Art 1(a) of Reg 1408/71? In the Twomey case,99 the Court ruled that active employment is not necessary for the application of Art 19.According to the Court, the article applies ‘to a national of a Member State who, after being in paid employment in that State and acquiring as a result the status of an insured person, went to live in another Member State where he fell ill, even though he had not worked there before falling ill’.100 The case referred to a United Kingdom national who was employed as a home help in London from May 1986 to 3 July 1987. On 19 July 1987 she settled in Ireland and on 23 February 1988 she applied to the competent authority of the United Kingdom for sickness benefit. Until the latter date, she had not engaged in any occupation in Ireland. Her claim was rejected on the ground that United Kingdom law precludes payment of the benefits where the claimant does not reside in the United Kingdom. The question raised was whether Art 19, in the light of Art 42 of the Treaty, should be interpreted as applying to a person in her situation. The Court stated, at first, that Ms Twomey had the status of an employed person within the meaning of Art 1(a) of the Regulation, since she would have been entitled to sickness benefit if she had resided in the United Kingdom. Subsequently, the Court noted that ‘if the intention of the Community legislature had been to limit the scope of Article 19 of Regulation No 1408/71 to persons falling ill whilst employed, it would have made express provision to that effect’.101 The Court thus based its decision on a broad interpretation of Art 1(a). More importantly, it emphasised that a restrictive interpretation of the concept of ‘worker’ for the purposes of Art 19 could not be justified.102 Art 22 also refers to ‘employed or self-employed’ persons. The case law reveals that economically non-active persons, such as pensioners,103 are covered by this concept. It should be noted here that the Court in Twomey used the applicability of Art 22 to pensioners as an argument to underpin its view on the applicability of Art 19 to persons who are not actively employed. The Unger case104 had already given a clear answer to the question of whether a person experiencing a temporary work interruption should be entitled to sickness benefits in the case of an illness during a temporary stay abroad. In Unger, the Court held that the provisions concerning exportability in the case of a stay abroad were applicable to a person regarded as a 99

Case C-215/90 [1992] ECR I-1823. Paragraph 18 of the judgment. 101 Ibid, para 14. 102 See also E Eichenhofer, ‘Co-ordination of Social Security and Equal Treatment of Men and Women in Employment: Recent Social Security Judgments of the Court of Justice’ (1993) 30 CML Rev 1021, at 1030–1. 103 Case 117/77 Pierik [1978] ECR 825. 104 Above, ch 4 at 1.1. 100

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228 The Application of the Fundamental Principles of Co-ordination worker in the Community meaning of the term. The value of this case for the purposes of the book lies, as noted above, in the fact that it concerned a work interruption taking place because of childbirth/child-rearing. The Kuusijärvi case105 raised the issue of the application of Art 22 to persons taking parental leave, but the case was eventually ruled on the basis of the family benefits provisions of Reg 1408/71.106 In any case, however, given the general developments in the area, most notably the introduction of a European Health Insurance Card,107 there should be no doubt that the provision applies to economically non-active people. b. Old Age Benefits The exportability provision concerning old age benefits, as mentioned above, is Art 10(1) of Reg 1408/71. The question of whether this provision applies to economically non-active persons has no substance within this context as it obviously applies to pensioners, who are by definition economically non-active persons. c. Unemployment Benefits The exportability provision within the chapter concerning unemployment benefits is Art 69. Also significant in this context is Art 71 which provides the possibility of acquiring benefits in the Member State of residence rather than the Member State of employment.108 This article may be particularly important in cases of family-induced migration. The beneficiaries of these provisions are obviously unemployed people. The question, therefore, as to whether these provisions apply to people interrupting work cannot be posed. The interesting question concerns another issue, namely how the concept of ‘unemployed’ is defined within the context of these articles. The more particular question of interest is whether this concept covers people (mainly women) interrupting work due to family-related migration. In the following pages, an attempt will be made to answer the question, first in relation to Art 69 and then to Art 71. Article 69 of Reg 1408/71 applies, according to its own wording, to ‘an employed or self- employed person who is wholly unemployed and who satisfies the conditions of the legislation of a Member State for entitlement to benefits’. Thus, a necessary condition for the application of Art 69 is that the person concerned satisfies the conditions of the legislation of a Member State for entitlement to unemployment benefits.109 Two main conditions appear to be common in all the Member States as regards entitlement to unemployment benefits: that the person concerned has completed

105

C-275/96 [1998] ECR I-3419. Contrary to the Court, the Advocate General considered the benefit in question to be a maternity benefit and argued for its exportability on the basis of Art 22 (see, in particular, paras 61–67 of his Opinion). 107 Above, 1.1 a ii. 108 Above, at 1.1 c. 109 See also Case 79/81 Baccini [1982] ECR 1063. For the purpose of the application of the provisions of ch 6, other payment or compensation that is directly related to the risk of unemployment can be treated as unemployment benefits (Case C-243/94 Moreno [1996] ECR I-1887). 106

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The Exportability Principle 229 qualified periods of insurance or employment; and that s/he is registered as unemployed or as seeking work.110 In some Member States, a further condition is required: the unemployment must be involuntary. This is the case in Denmark, Greece, Luxembourg, Spain, Sweden111 and the United Kingdom. In France, the unemployment has to be involuntary unless there is a ‘good cause’ for interrupting work. It follows that Art 69 of Reg 1408/71 is applicable to a voluntarily unemployed person in a Member State covering voluntary unemployment, while it is not applicable to another person, in an identical situation, in a Member State not covering this type of unemployment. People interrupting work because of movement to another Member State for family reasons may be unable to fulfil several of these conditions. They may be unable, for instance, to register with the employment services of the Member State in which they completed qualification periods because they no longer reside there. Following the Bergemann-precedent, however, they will be able to register with the employment services of the Member State of residence and apply for unemployment benefits in that state.A more serious problem may occur if the unemployment scheme in that state does not cover voluntary unemployment and if the unemployment caused by the (family-related) migration is considered ‘voluntary’ unemployment. Interrupting work because of (family-related) migration is often voluntary. As stated above, the unemployment schemes of several Member States do not cover people voluntarily interrupting work, and consequently Art 69 does not to apply to them. The issue has not yet attracted any interest at the Community level. The Advocate General in the Bergemann case, however, paid it some attention. The Advocate General made a comparative examination of the treatment of voluntary unemployment in the legal systems of the Member States in order to establish the impact of this element as to the application of Reg 1408/71. He came to the conclusion that in most Member States, the award of unemployment benefits is linked to the requirement of involuntary unemployment. When voluntary unemployment is covered, it is on condition that there are good reasons justifying it. Examining the national systems, he found that the aim of following a spouse to his or her place of residence may constitute a valid reason under German law, and does not constitute an obstacle to the award of unemployment benefits. Unemployment benefits will also be awarded under the French, Spanish and Portuguese legal systems, although in Portugal the administrative authorities have a certain amount of discretion. The Advocate General considered that an employee 110 For a survey of the requirements of the national schemes against unemployment, see the comparative tables included in the MISSOC database. 111 The information contained in MISSOC on the Swedish system is inaccurate, as voluntary unemployment is covered by unemployment insurance schemes, albeit that payment of unemployment benefits is subject to a waiting period of 45 days (karensdagar). See Federation of Unemployment Insurance Funds, What you need to know about Unemployment Insurance (2002), available at http://www. alfakassan.se/upload/pdf/in_english.pdf. On the other hand, unemployment insurance is not compulsory. The schemes are voluntary in the sense that a person has to decide for him/herself whether or not to join and pay contributions to that end.

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230 The Application of the Fundamental Principles of Co-ordination finding him/herself in such a situation would probably be unable to claim unemployment benefit under British or Irish law as a transfer of residence in circumstances similar to the circumstances in the Bergemann case would not constitute a ‘just cause’ under these systems. Neither would this situation be treated favourably by the Belgian system of unemployment protection, as family reasons are taken into account, if at all, only in exceptional cases. The view widely expressed in the decisions of the Belgian courts, according to the Advocate General, is that the termination of an employment contract on the ground of marriage and subsequent change of residence is not ‘involuntary’ for the purposes of law, and consequently does not give rise to entitlement to unemployment benefits. As for the Netherlands, the final outcome would be dependent on an examination of all the surrounding circumstances. The conclusion of the Advocate General was that a comparative examination of the national systems: [d]oes not disclose the existence of a general principle of law according to which the spouse is always entitled to unemployment benefit, where his or her unemployment is the result of a change of residence linked to family circumstances. It is to be observed, however, that the principle that an employee who gives up his employment in order to live together with his spouse or to be able to continue living together should not be refused unemployment benefits is widely accepted.112

In his opinion, voluntary unemployment caused by family-related migration should be treated on an equal footing with involuntary unemployment for the purpose of applying the provisions of chapter six. He did, however, state that a general principle of law is lacking.113 As to the application of Art 71, it appears that an employment relationship must somehow exist despite the work interruption/unemployment. The Bergemann case114 showed that a person interrupting work and moving to another Member State for family reasons may claim unemployment benefits in the country of residence pursuant to Art 71(1)(b)(ii) of Reg 1408/71. There is, however, an important condition for the application of this provision in cases of work interruptions caused by family-related migration that must receive attention. This condition refers to the employment status of the person concerned at the time of movement. The Opinion of the Advocate General in the Bergemann case is quite enlightening on this point. The Advocate General made some significant comments about the phrase ‘an employed person, other than a frontier worker, who is wholly unemployed’ included in Art 71(1)(b)(ii) and defining its personal scope. He pointed out that it had to be asked first whether the bare four weeks after the move during which the employment continued to exist amounts to having been ‘employed’ for the 112

Paragraph 35 of the Opinion. Van Langendonck argues that one of the major problems of unemployment insurance is the lack of an objective standard for entitlement to benefits.As he points out, it is extremely difficult to determine what is normal behaviour that is or should be covered by an unemployment scheme in a complex environment. See J van Langendonck, ‘From Unemployment to Labour Market Insurance’ in D Pieters (ed), Confidence and Changes: Managing Social Protection in the New Millennium, EISS Yearbook 2000 (The Hague, Kluwer Law International, 2001). 114 Above at I, 1,2 c. 113

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The Exportability Principle 231 purposes of the provision. Doubt arises, first because the period in question was relatively short, and secondly because the person in question was released from her obligation to perform duties in connection with her work, because she was on leave. The Advocate General stated: [I]t may be seen that Article 71 does not fix any periods for which the typical situation covered by the provision must have existed, in other words that in which the State of employment and the State of residence are not the same. Even relatively short periods of time may suffice for the retention of rights or their acquisition . . . The essential question is therefore whether the employment relationship was one which existed in law and in fact. (emphasis added)115

The Advocate General argued that both elements existed in the case at issue. As regards the existence of an employment relationship in fact, he emphasised that the fact that the person concerned did not perform work duties because of paid leave made no difference for the application of Art 71(1)(b)(ii).116 Consequently, it appears that while the duration of the employment relationship after the move, or the actual performance of duties, are of no importance, the very existence of such a relationship ‘in law and in fact’ at the time of movement is of crucial importance. It is perhaps not unusual that people moving for family reasons terminate their employment relationship before they move. For the purpose of the application of Art 71(1)(b)(ii) of Reg 1408/71, however, it seems to be crucially important that the move occurs while an employment relationship still exists. d. Family Benefits The exportability provisions of chapter seven concerning family benefits, ie, Articles 73 and 75(1), refer to ‘employed or self-employed persons’. The question again is whether the meaning of this term should be understood in the light of Art 1(a) of Reg 1408/71. There is a rich body of case law with regard to the application of Art 73 in particular, suggesting that there can be a differentiation between the personal scope of the exportability provisions of chapter seven concerning family benefits, and the personal scope of Reg 1408/71 in general. In a series of cases it was found that categories such as pensioners,117 self-employed persons118 and persons on leave119 did not come within the scope of persons covered by Art 73 and could not thus enjoy rights safeguarded by it. In the Garcia case, the Court emphasised that Art 73 does not itself confer any entitlement to family benefits, but is intended in particular to prevent Member States from making entitlement to, or the amount of, family benefits subject to the requirement that members of the worker’s family reside in the Member State providing the benefits.120 115

Paragraph 19 of the Opinion of the Advocate General. Ibid, para 20. 117 See Case C-194/96 Kulzer [1998] ECR I-895. See also Case 313/86 Lenoir [1988] ECR 5391, concerning the limited right of a migrant pensioner to family benefits. 118 Cases C-4/95 and C-5/95 Stöber and Pereira [1997] ECR I-0511. Cf though the earlier Brack case (17/76 [1976] ECR 1429), where the Court stated that the sole purpose of Annex V, which was the relevant Annex at the time, was to clarify the scope of Art 1(a)(ii). 119 Case C-266/95 Garcia [1997] ECR I-3279. 120 Cf the Court’s statement in the Brusse case (101/83 [1984] ECR 2223). 116

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232 The Application of the Fundamental Principles of Co-ordination While the differentiation between the general scope of Reg 1408/71 and the scope of chapter seven seemed initially to apply only with respect to German family benefits,121 it soon became apparent that it may be a more general differentiation. That was shown in the Commission v Netherlands case,122 where the Commission of the European Communities sought a declaration that, by refusing to pay child benefit to employed people who had taken early retirement and resided outside the national territory, the Netherlands had failed to fulfil its obligations under the EEC Treaty. It should be noted here that the Netherlands authorities refused to grant child benefits to people in receipt of early retirement benefits and who did not reside in the Netherlands, on the grounds that, on the one hand, the Netherlands legislation only provided for the granting of child benefits to residents and non-residents subject to income tax by reason of employment in the Netherlands, and, on the other hand, that Reg 1408/71 contained no provisions entitling early retired people residing in another Member State to family benefits. However, the Regulation contains such provisions concerning employed and self-employed persons, unemployed persons and pensioners.123 One of the main points put forward by the Commission was that the provisions of the Regulation concerning the award of family benefits to employed persons should be applicable to people who have taken early retirement, since they were ‘employed’ persons within the meaning of Art 1(a) of Reg 1408/71. According to the Advocate General, the Commission, before bringing an action under Art 169 of the EEC Treaty against the Netherlands, had for some time been trying to close the gap in the Regulation with respect to people taking early retirement. Bringing an action in the Court was a new strategy for the Commission in its efforts to fill the lacuna by way of interpreting the existing provisions without any amendment of Reg 1408/71.124 Advocate General van Gerven was very clear on how the question submitted to the Court should be answered: [I]t is of course true . . . that persons who have taken early retirement are employed persons within the meaning of Art 1(a) of Regulation No 1408/71 and that they fall within the personal scope thereof as defined in Article 2 thereof. But that does not mean that they are also employed persons for the purposes of Article 73 of Regulation 1408/71. For that article does not concern all employed persons within the meaning of Article 1 of the regulation, which is clearly demonstrated by the existence of distinct provisions on benefits for children dependent on unemployed persons (Article 74) and of pensioners (Article 77), two categories which, together with the category of employed persons laid down in Article 73, fall within the broad term of ‘employed person’ mentioned in Article 1(a) and Article 2 which defines the personal scope of the regulation.125 (emphasis added) 121

Due to the narrower meaning of the term ‘employed’ included in point I.C of Annex I, which referred particularly to the award of German family benefits. 122 C-198/90 [1991] ECR I-5799. 123 Articles 73, 74 and 77 of Reg 1408/71 respectively. 124 See the Opinion of the Advocate General van Gerven in Commission v Netherlands (C-198/90 [1991] ECR I-5799), delivered on 17th September 1991. 125 Ibid, para 8. See also Case C-57/90 Commission v France [1992] ECR I-75, paras 11–14 of the judgment.

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The Exportability Principle 233 In its very brief judgment, the Court agreed with the opinion of the Advocate General. It held that ‘Article 73 does not apply to such employed persons’, that is to say to early retired workers.126 We can look behind this restrictive interpretation of the personal scope of Art 73 to find a conflict between national laws and the Community law of co-ordination when it comes to the exportability of benefits such as family benefits, which are often based on expectations of solidarity. Member States continue to set residence in the country as a condition for entitlement to such benefits, while the residence requirement in principle is seen as an obstacle to the free movement of workers and as indirectly discriminating against foreign workers.127 Lately, however, an important development has taken place with regard to the issue of application of Art 73 to persons interrupting work for reasons of childrearing, and it was finally settled to their favour. In the Dodl and Oberhollenzer case,128 the Court established that a person retains the status of ‘employed person’ within the meaning of Art 73 of Reg 1408/71, as well as within the meaning of Art 13(2)(a), during periods of work interruption provided that s/he is covered by a social security system, in other words provided s/he is an ‘employed’ person within the meaning of Art 1(a).

2. The Provisions of Reg 883/04 Regulation 883/04 has brought about some changes, mainly with regard to the material scope of the exportability principle. These developments will be examined in the following pages. 2.1 The Content of the Exportability Principle The principle of exportability in Reg 883/04 is entrenched in Art 7. Pursuant to it: Unless otherwise provided for by this Regulation, cash benefits payable under the legislation of one or more Member States or under this Regulation shall not be subject to any reduction, amendment, suspension, withdrawal or confiscation on account of the fact that the beneficiary or the members of his/her family reside in a Member State other than that in which the institution responsible for providing benefits is situated.

Obviously, the exportability principle enjoys a broader scope of application under Reg 883/04 than Reg 1408/71 since it also covers short-term benefits. No distinction is made between long-term and short-term benefits and both are equally covered by 126 See also Commission v France, ibid, which, apart from raising the question of the application of Title II to early retired persons, also concerned the application of a specific provision of Title III, ie Art 33, to the same category of persons. 127 A Christensen and M Malmstedt, ‘Lex Loci Laboris versus Lex Loci Domicilii—An Inquiry into the Normative Foundations of European Social Security Law’ (2000) 2 European Journal of Social Security 69, at 77. 128 Case C-543/03 [2005] ECR I-05049.

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234 The Application of the Fundamental Principles of Co-ordination the principle of exportability. This must be considered a significant development, since many benefits of interest from a gender perspective, such as maternity or family benefits, are short-term benefits. However, attention must be paid within this context to Art 70(3) and (4), according to which, Art 7 is not applicable to special non-contributory cash benefits. Such benefits are to be provided exclusively in the Member State in which the people concerned reside, in accordance with its legislation, and they are to be provided by and at the expense of the institution of the place of residence. Apart from this general exportability provision, specific articles concerning the provision of benefits in a Member State other than the competent one129 are included in the chapters of Title III concerning specific benefits.130 Thus, pursuant to Art 17 concerning sickness, maternity and equivalent paternity benefits, an insured person who resides in a Member State other than the competent Member State is to receive in the Member State of residence benefits in kind provided, on behalf of the competent institution, by the institution of the place of residence, in accordance with the provisions of the legislation it applies, as though the person concerned is insured under said legislation. In cases of a stay in another Member State, Art 19 provides that an insured person staying in a Member State other than the competent Member State is to be entitled to the benefits in kind which become necessary on medical grounds during their stay, taking into account the nature of the benefits and the expected length of the stay. These benefits shall be provided on behalf of the competent institution by the institution of the place of stay, in accordance with the provisions of the legislation it applies, as though the people concerned are insured under said legislation.131 Regulation 883/04 contains a specific provision for cases of travel with the purpose of receiving benefits in kind. In such cases the person concerned is to seek authorisation from the competent institution.132 A person who has obtained authorisation is to receive the benefits in kind provided, on behalf of the competent institution, by the institution of the place of stay, in accordance with the provisions of the legislation it applies, as though s/he is insured under said legislation. Authorisation is to be granted where the treatment in question is among the benefits provided for by the legislation in the Member State where the person concerned resides and where s/he cannot be given such treatment within a time limit which is medically justifiable, taking into account his/her current state of health and the probable course of his/her illness.133 129

As to the meaning of the term ‘competent Member State’, see Art 1(s) and (q) of Reg 883/04. See eg Reg 883/04, Arts 17–20 (in ch 1) on sickness, maternity benefits and equivalent paternity benefits, and Arts 63–65 (in ch 6) on unemployment benefits. 131 According to Art 19(2), the Administrative Commission is to establish a list of benefits in kind which, in order to be provided during a stay in another Member State, require for practical reasons a prior agreement between the person concerned and the institution providing the care. See also Art 18 concerning the right to benefits in the case of a stay in the competent Member State when residence is in another Member State. 132 Regulation 883/04, Art 20(1). 133 Ibid, Art 20(2). 130

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The Exportability Principle 235 Furthermore, according to Art 21(1), an insured person residing or staying in a Member State other than the competent Member State shall be entitled to cash benefits provided by the competent institution in accordance with the legislation it applies. By agreement between the competent institution and the institution of the place of residence or stay, such benefits may, however, be provided by the institution of the place of residence or stay at the expense of the competent institution in accordance with the legislation of the competent Member State. Specific provisions restricting the right to export unemployment benefits exist in Title III. Thus, a wholly unemployed person is entitled to receive unemployment benefits for a period of three months from the date when the unemployed person ceased to be available to the employment services of the Member State which s/he left, provided that the total duration for which the benefits are provided does not exceed the total duration of the period of her/his entitlement to benefits under the legislation of that Member State. The competent services or institutions may however extend the period of three months up to a maximum of six months.134 The right to benefits is subject to conditions of registration similar to those found in Reg 1408/71.135 As for unemployed persons who reside in a Member State other than the competent state and who are partially or intermittently unemployed, they are to receive benefits in accordance with the legislation of the competent Member State as if they were residing in that Member State. These benefits shall be provided by the institution of the competent Member State.136 Wholly unemployed persons are to make themselves available to the employment services in the Member State of residence. They may, as a supplementary step, make themselves available to the employment services of the Member State where they pursued their last activity.137 The question of determining the applicable legislation for unemployed persons who, during their last employment, resided in a Member State other than the competent state was one of the thorniest problems within the framework of the process of adopting Reg 883/04. The amending proposal aimed initially at ending the system imposed by Reg 1408/71, whereby the unemployed cross-border worker received unemployment benefits from the state of residence. No absolute agreement was reached by the Council on this point, however, and the system established in the new Regulation reflects a compromise.138 As to the chapter concerning family benefits, according to Art 67 a person is to be entitled to family benefits in accordance with the legislation of the competent Member State, including for his/her family members residing in another Member State, as if they are residing in the former Member State. The award of family benefits in general is regulated by priority rules.139 134

Ibid, Art 64(c). See ibid, Art 64(1)(a) and (b), and above 1.1 c i. Ibid, Art 65(1). 137 Ibid, Art 65(2). 138 The complexity of the issue is also demonstrated by the fact that the new Regulation is not much simpler than Reg 1408/71, which contains a number of provisions on this issue; see Art 65. 139 Below, at III, 2. 135 136

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236 The Application of the Fundamental Principles of Co-ordination 2.2 The Personal Scope of the Provisions concerning Exportability The number of specific provisions establishing entitlement to benefits in a Member State other than the competent one has been diminished in the new Regulation. Thus, specific provisions exist only within the framework of the chapters concerning sickness, maternity and equivalent paternity benefits, as well as unemployment. At the same time, the general exportability principle that has been extended to cover all benefits apart from special non-contributory cash benefits is obviously intended to be applicable to all people covered by the new Regulation. 3. Work Interruptions and Application of the Exportability Principle Our focus now turns to an assessment of the state of the law from the perspective of people interrupting work due to childbirth/child-rearing or migration, and answering the question of whether the specific exportability provisions of Title III of Reg 1408/71, as well as Reg 883/04, are applicable to them. 3.1 Work Interruption because of Childbirth/Child-rearing The first question to be posed with regard to Reg 1408/71 is whether the provisions of Art 19 and 22 of Reg 1408/71 concerning sickness/maternity benefits apply to people interrupting economic activity because of childbirth/child-rearing. The answer should be in the affirmative. There is no case law concerning the application of Art 19 to people interrupting work for the particular reason of childbirth/childrearing. The entire development of the law in this area, however, supports this conclusion. As to Art 22, the Unger case showed very early on that it applies to this particular category. Subsequent developments have only confirmed and strengthened the view adopted in this early judgment. The question of whether the exportability provisions concerning old age benefits and unemployment benefits apply to people who have interrupted work because of childbirth/child-rearing cannot be posed. The beneficiaries of the provisions are pensioners and unemployed persons respectively, and people interrupting work for the particular reason at issue here by definition do not belong to these categories. In contrast, the question of the application of the exportability provisions concerning family benefits to people having interrupted work because of childbirth/child-rearing is a very interesting question. No direct answer could be provided by Reg 1408/71 or by the case law until the recent Dodl and Oberhollenzer case140 settled the law for the benefit of the people (women) concerned. Regulation 883/04 obviously makes the general principle of exportability applicable to all persons covered by the Regulation, even with respect to short-term benefits, while there appear to be no specific provisions in Title III capable of restricting this right. No essential changes have been made by the new Regulation as 140

Above, n 128.

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The Exportability Principle 237 the right to export the benefits under examination here had already been extended to the people at issue by the case law. The right of a person to enjoy benefits may, however, be jeopardised by the non-overlapping principle, to be discussed later. 3.2 Work Interruption because of Migration A first important question when a person interrupts economic activity because of migration is whether s/he can acquire unemployment benefits and export them. The acquisition of such benefits can be hindered due to the inability of the person concerned to fulfil necessary conditions laid down in the national scheme, for instance registration with employment services. In many national systems, the unemployment covered is involuntary unemployment. Resigning from work, for instance, to accompany or join a partner in another Member State, may thus not be considered as falling within the concept of unemployment. The Community law of co-ordination facilitates for people moving to another Member State for family-related reasons an application to receive benefits in the Member State of new residence although they have not completed periods of employment or insurance in that Member State. However, the application of the legislation of the Member State of residence seems to be dependent on the condition that, at the time of movement, an employment relationship existed ‘in fact and in law’. That expression does not necessarily imply the performance of work duties after movement; the receipt of paid leave is sufficient. This condition, however, may be difficult to fulfil. An employment relationship may not exist if the person concerned terminates the employment relationship before moving. In addition, two important questions remain: Will the legislation of this Member State apply even if it does not cover voluntary unemployment? What will the level of benefits be? Regulation 883/04 did not entail any progress, as proposals concerning especially the safeguarding of unemployment benefits for people moving for family reasons have not been accepted. More specifically, within the process of amending Reg 1408/71, the European Parliament proposed the insertion of a new provision into the chapter concerning unemployment benefits, pursuant to which people who have left their employment to move for family reasons to another Member State, and are therefore not available to the employment services in the first Member State, are to be considered as unemployed and entitled to the appropriate benefits in their new Member State of residence if they register with the unemployment services of that Member State within one month of taking up residence. It was important, as emphasised by the Parliament, to recognise that people leaving employment in one Member State to move to another for family reasons should not lose their right to unemployment benefit either in the old or in the new country of residence.141 This proposal, however, did not receive any attention.142 Thus, the issue of ‘voluntary’ unemployment remains 141 See European Parliament, Report on the Proposal for a European Parliament and Council Regulation on Co-ordination of Social Security Systems (COM (1998) of 17 June 2003. 142 See COM (03) 596 final and COM (04) 44 final.

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238 The Application of the Fundamental Principles of Co-ordination Of the other benefits examined in the chapter, the question of exportability can be posed as regards sickness/maternity benefits and family benefits. Can a person interrupting work because of migration export such benefits acquired in the Member State of employment? Article 25 of Reg 1408/71 contains provisions concerning the award of sickness/maternity benefits to unemployed persons in a Member State other than the Member State of last employment. Articles 74 and 75(1) of Reg 1408/71 provide unemployed persons with the same rights as employed persons, ie an award of family benefits to unemployed persons irrespective of whether family members or the beneficiary reside within the territory of the competent Member State. Thus, the answer to the question according to Reg 1408/71 depends once again on whether the person interrupting work because of migration can be regarded as an unemployed person. Provisions concerning the award of sickness, maternity and equivalent paternity benefits were not included in Reg 883/04. Since, however, terms like ‘employed person’ and ‘unemployed person’ were replaced by the term ‘insured person’ in the provisions of chapter one of the Regulation, it follows that persons such as those under consideration here are covered by these provisions. Regulation 883/04 thus entails a considerable change inasmuch as it appears that insurance under any branch of social security is sufficient for the application of this chapter without any need to satisfy the requirements of an unemployment scheme. In chapter eight, which concerns family benefits, the simple term ‘person’ is used. Therefore, family benefits must be considered to be exportable by the category of people examined here.

4. Classification of the Benefit related to Child-rearing The co-ordination system, like all other social security systems at the national and international levels, includes two categories of benefits that are directly connected to the arrival of a child and the creation of a new family: maternity benefits and family benefits. In Reg 883/04, a new concept and a new term related to maternity benefits was added, namely paternity benefits. The distinction between these two categories of benefit, namely maternity/paternity benefit and family benefit, appears simple at first sight. However, it can be extremely complicated, especially when it comes to new benefits introduced in response to new social conditions. One such benefit is that relating to child-rearing, which is usually called the parental benefit. Should this particular benefit be classified under the recognised social risk of maternity or under the recognised social risk of family? Should chapter one or chapter seven of Reg 1408/71 (and respectively chapter eight of Reg 883/04) apply in relation to this benefit? The classification, as already noted, is important for the application of the main principles of co-ordination. In the following pages, we will focus particularly on the problem of classification of the parental benefit. To this end, attention is paid first to maternity benefits as they are defined in the national systems of the Member States, as well as within the framework of the co-ordinations

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The Exportability Principle 239 system. Our attention then turns to family benefits. The examination is conducted on the basis of material relating to Reg 1408/71, first because the new Regulation is no different in this respect from Reg 1408/71, and second, because no case law or other clarifying material yet exists with regard to Reg 883/04. Finally, the issue of classification of the parental benefit is discussed. 4.1 The Definition of Maternity Benefits What is the definition of the term ‘maternity benefits’? What concrete benefits are to be classified as such? Neither the provisions of Title III nor any other provision in Reg 1408/71 (or Reg 883/04) gives a definition. Nor is any direct definition provided by the case law, although some criteria are available. It should also be added that no definition of the new term ‘paternity benefits’ is provided in Reg 883/04, other than saying that they should be ‘equivalent’ to maternity benefits. In trying to understand the concept of maternity benefits in Reg 1408/71, a first remark that can be made is that the term ought to refer to benefits designated to cover the period of physical incapacity of the worker owing to childbirth. This is clearly implied by the double reference of the relevant provisions of Reg 1408/71 to maternity and sickness benefits without any distinction. However, although the term undoubtedly concerns benefits designed to cover physical incapacity, it cannot be concluded that it exclusively concerns benefits relating to physical incapacity. The Court has laid down some criteria not aimed at defining the term, but rather to help classify benefits as maternity benefits. Before examining these criteria, it is useful to review briefly the national schemes of the Member States protecting maternity. In this way, we can get an idea about what benefits might be classified as maternity benefits under Reg 1408/71—although not necessarily. a. Maternity Benefits in the National Systems of the Member States On the basis of information extracted from the MISSOC database,143 the schemes in all the Member States designated to cover the risk of maternity include three sorts of benefits: benefits in kind, maternity leave, and benefits in cash. i. Maternity Benefits in Kind Maternity benefits in kind are classified either under the branch of social security covering ‘maternity’ or under the branch covering ‘health care’. In the case of Belgium, Portugal and the United Kingdom, the benefits provided are exclusively listed under the ‘health care’ branch of social security. Thus, benefits relating to the risk of maternity are provided within the framework of provisions concerning medical treatment and hospitalisation in general. In the majority of the Member States, maternity benefits are provided both within the framework of general ‘health care’ provisions, and through special provisions of the social security system that relate directly to the risk of maternity. This is the case in Germany, Spain, France, the Netherlands, Austria, Finland and Sweden. In Denmark, Greece, Ireland, Italy and Luxembourg, maternity benefits in kind are provided through schemes designated particularly to cover the risk of maternity. 143

See Introduction, n 32.

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240 The Application of the Fundamental Principles of Co-ordination The risk of maternity is thus conceptualised as a separate social security risk to differing extents in the different Member States. The national schemes vary, but, generally, maternity benefits in kind include medical care or midwife care or hospital care, home care and family assistance (Germany), drugs and appliances. Some cash benefits, such as payment for birth expenses (Greece), or a flat-rate sum for maternity confinement (France), are also classified as maternity benefits in kind. Some benefits classified as maternity benefits are based on the needs of the child rather than the mother, for instance lump sum payments for baby food in Luxembourg, or other necessities for the care of the child in Finland.144 According to this classification, maternity benefits in kind aim, in the first instance, at safeguarding the health care of the mother during pregnancy, confinement and shortly afterwards. They are in other words connected to the biological fact of giving birth to a child, and are intended to cover the health needs of the mother during a certain period as well as the expenses connected to such needs. In that sense, maternity benefits in kind are strictly sex-related as they can only be granted to women. Apart from that, preliminary infant care can also, to a certain extent, justify payment of maternity benefits, but the classification of such benefits is less certain. ii. Maternity Leave Maternity leave is usually classified as maternity benefit, although it sometimes figures as a family benefit too. It is also usually regarded as a maternity benefit in cash. The distinction between maternity benefits in cash and in kind is essential in some respects, for example with regard to the exportability of benefits as discussed above.145 The comparative picture of the national schemes concerning maternity leave, according to the MISSOC database, is summarised below. In most Member States, maternity leave comprises two phases: an initial phase which applies exclusively to mothers and covers the time around confinement, and a second phase, usually following the initial leave granted to mothers, which is conferred upon both parents. National variations generally concern the emphasis placed on one or the other phase of the leave. More particularly: In Sweden, a parent’s cash benefit (föräldrapenning) is payable for at the most 480 days. Of these, 390 days are paid according to the sickness cash benefit rate, and the remaining 90 days are paid according to the guarantee amount. These days a woman is entitled to these, at the earliest, 60 days before her expected confinement. Either parent is entitled up until the child is eight years old. Parents sharing custody are each entitled to half of the total number of benefit days. A two-week long leave in connection with confinement is reserved for mothers. Fathers are entitled to 10 benefit days (father days, pappadagar) in connection with the birth of a child. Sixty days of the parental leave are exclusively reserved for each parent and are not transferable. Since in practice most fathers transfer their right to parental leave 144 Such benefits, however, demonstrate how difficult the classification of benefits may be, as they are also classified as family benefits. 145 Above, at II, 1.1 a i and ii.

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The Exportability Principle 241 benefits—where they are transferable—to the mother, the 60-day period works more as guaranteed father months. A cash benefit for temporary parental leave (tillfällig föräldrapenning) is paid, for example, in the case of a sick child, for a maximum of 60 days per year until the child is 12 years old. The system contains similar provisions in cases of adopting a child. Finland provides a maternity allowance (äitiysraha) paid to the mother for 105 consecutive calendar days excluding Sundays, 30–50 of which can be taken before the expected date of confinement. Paternity allowance (isyysraha) can be paid to a father for a maximum of 18 days. A parental allowance (vanhempainraha) is paid immediately after the maternity allowance to either the mother or father for 158 days (excluding Sundays). In cases of multiple births, 60 days are added to this period for each additional child. In cases of adoption of a child under the age of seven, the parental allowance is paid for a minimum of 180 days. In Denmark, employed or self-employed women or women pursuing training/ education under unemployment programs are entitled to weekly payments during four weeks before expected confinement and for 24 weeks after. The last 10 of the 24 weeks may be in favour of the father. Employed or self-employed fathers are entitled to weekly payments for 2 weeks within the 14 weeks following birth and for 2 weeks after expiry of the 24-week period. In cases of adoption, parents have the right to weekly payments for 24 weeks from the date when the parent actually takes charge of the child, of which 2 weeks are for the two adopting parents. Furthermore, the adopting father has a right to 2 weeks after the 24-week period. In Spain, maternity benefit is paid for a maximum of 16 weeks. If both parents work, four weeks’ leave and allowance may be paid in favour of the father. In the event that the mother dies during childbirth, the father has the right to postnatal maternity leave. An allowance is paid for 16 weeks in the case of adopted or fosterchildren. In France, maternity cash benefits are paid for a period of 16 weeks (6 weeks before confinement and 10 after) to employees interrupting work. The number of weeks varies according to the number of children. The maternity leave granted in cases of adoption can be divided between the father and the mother, on the condition that both are entitled. In the case of the death of the mother during childbirth, the father is entitled to paternity leave. In Italy, a maternity allowance (indennità di maternità) is paid only if wages are discontinued: two months before the presumed confinement date and three months after. After this initial period of compulsory leave of five months granted to mothers, both parents have the right to take six supplementary months. This optional supplementary leave (astensione facoltativa dal lavoro) may be requested by the father if the mother does not claim it, or if the father has sole custody. In Portugal, maternity allowance (Subsídio de maternidade) includes a 98-day maternity leave (60 of which have to be after confinement). A paternity allowance is provided for in case of the physical or mental incapacity of the mother, the mother’s death, or based on a joint decision made by both parents. The extent the benefit is calculated in relation to the period for which the mother would have had a right to

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242 The Application of the Fundamental Principles of Co-ordination the benefit. In the event of the mother’s death, however, the period is a minimum of 14 days. As regards the other Member States, the information contained in the MISSOC database does not reveal what portion of the maternity leave, if any, is reserved or available to the father. Nevertheless, while some systems may not yet specify a period that is available to the father, this is likely to change given the influence of the European Community’s policy promoting a common European model of leave. According to this model, maternity leave is granted on a compulsory and voluntary basis to working pregnant women and mothers for the period before and/or after confinement, while parental leave is granted to both parents, preferably on a nontransferable basis.146 In other words, the model promoted by the Commission envisages maternity benefits aimed at facilitating both maternity and parental leave.147 For the majority of the Member States, the new model entailed an obligation to introduce the possibility of parental leave in their systems. The shift from an ideology of protection of the mother to an ideology of equality of parents—and vice versa, in some cases—still causes lively political and legal debates.148 Some Member States provide for obligatory paternity leave.149 As we can see from the description of the national systems given above, parental leave is conceived as a part of maternity leave, and it is usually classified as a maternity benefit. This linguistic inaccuracy must be attributed to the historical origin of parental leave as stemming from maternity leave, as well as to the fact that ‘parenthood’ is not a recognised social risk.150 Before concluding this review of the national systems and the impact of harmonisation in this area, it should be added that this impact does not at the moment affect the period before confinement. The national systems exhibit wide variations in this respect. Belgium, Ireland and the Netherlands provide for compulsory maternity leave before the expected date of delivery, the duration of which varies between one week in Belgium and four weeks in Ireland and the 146 See Dir 92/85 ([1992] OJ L348/1) on the introduction of measures to encourage improvements in the safety and health at work of pregnant workers and workers who have recently given birth or are breastfeeding. The Directive stipulates in Art 8 that compulsory maternity leave of at least two weeks allocated before and/or after confinement has to be introduced in all Member States. Furthermore, pregnant workers or workers who have recently given birth or are breastfeeding have the right to maternity leave lasting at least 14 weeks, including a compulsory period of two weeks. See also Dir 96/34 ([1996] OJ L145/4) as to parental leave. According to this, male and female workers are granted an individual right to parental leave on the grounds of the birth or adoption of a child to enable them to take care of that child, for at least three months, until a given age up to eight years. The right should, in principle, be granted on a non-transferable basis. 147 However, it does not include any compulsory paternity leave. 148 See eg R Eklund, ‘Obligatorisk mammaledighet—nytt vin I gamla läglar’ in A NumhauserHenning (ed), Normativa Perspektiv. Festskrift till Anna Christensen (Lund, Juristförlaget, 2000). 149 For a detailed account of national arrangements with regard to this issue, see P Moss and F Deven (eds), Parental Leave: Progress or Pitfall? (Brussels, NIDI/CBGS Publications, 1999). 150 In the case of Sweden, maternity leave had been completely replaced by parental leave (A Christensen, below n 207, at 134) but was re-introduced as Sweden had to adapt to Community demands for compulsory maternity leave, see above n 146.

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The Exportability Principle 243 Netherlands. All other Member States provide for the possibility of taking part of the maternity leave before confinement, without making pre-confinement leave compulsory. Some systems contain special provisions, apart from the provisions on maternity leave, for allowances during pregnancy. In Spain, the pregnancy allowance (riesgo durante el embarazo) is paid to expectant mothers who are unable to continue with their normal tasks during pregnancy. In Finland, a special maternity allowance (erityisäitiysraha) is paid during pregnancy if the mother is exposed to chemical substances, radiation or an infectious disease at work. In Sweden, a pregnancy cash benefit (havandeskapspenning) is payable for a maximum of 50 days during the last 60 days before the expected confinement. The benefit is paid to women who perform strenuous work, for whom there is no alternative job available, and to women whose working environment places the foetus at risk, if they are proscribed from continuing work due to regulations under the Working Environment Act. The system of financing the benefits remains in the national domain. It appears from the MISSOC review of the national systems that ‘maternity’ leave may not always entail an interruption in the payment of salaries. In Denmark, collective bargaining agreements provide for the continued payment of wages and salaries for certain groups of employees.151 In Germany, a supplement is paid by the employer. The supplement corresponds to the difference between the maternity benefit (Mutterschaftsgeld) paid by the sickness insurance fund and the net income of the insured woman. In Sweden, the right of employees to a supplement paid by the employer varies according to different collective agreements. In France, salary is maintained depending on the collective agreements or the monthly payment agreements. The employer pays only the difference between the wages and the maternity cash benefits (indemnités journalières de maternité). In Italy, compensation is paid, on behalf of the National Institute for Social Protection, by the employer. This amount is deducted from the contributions owing. In Austria, employer payments continue only for employees who earn less than a certain amount per month. In Finland, payment by employers can continue according to collective agreements. In the United Kingdom, Statutory Maternity Pay is the minimum amount of pay that the law requires employers to pay during maternity leave. Employers are free to pay a higher amount if they wish. In the rest of the Member States, employer payments during the period of maternity leave do not continue. In brief, there are two ways of financing maternity leave: through social security benefits, and through wages. In some Member States, the financing of maternity leave requires a combination of the two. iii. Maternity Benefits in Cash The term ‘maternity benefits in cash’ refers primarily to the receipt of maternity/parental leave, but can also refer to other cash benefits. The amount of benefits granted in relation to leave may vary during the period of the leave. In Belgium, for instance, maternity allowance varies between 82 151 In this case, employers are entitled to receive the maternity cash benefit (dagpenge ved födsel) of their employees.

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244 The Application of the Fundamental Principles of Co-ordination per cent of the wages (without ceiling) in the first 30 days, and 75 or 60 per cent of wages up to the ceiling respectively, for the period from 31st day, and for the period exceeding 15 weeks. In Italy, 80 per cent of earnings are paid for the compulsory period, and 30 per cent for the supplementary period. Most commonly, national systems contain ceilings for calculating the amount of the benefit paid. Examples of other maternity benefits in cash, not connected to leave include the Belgian Birth Grant and Adoption Grant (allocation de naissance and prime d’adoption), the German Birth Grant (Entbindungsgeld), paid at a fixed rate to insured people not entitled to maternity benefit, and the Luxembourg Birth Grant (allocation de naissance).152 The above review does not provide a definition of the concept of maternity risk or benefits, or any criteria relating to this issue. It merely describes the type of benefits that are usually perceived and classified as maternity benefits in the national systems, thus indicating the type of benefits that might also be classified as maternity benefits within the context of Reg 1408/71. No criteria of distinction between maternity benefits in cash and maternity benefits in kind, or between maternity benefits and family benefits are revealed. On the contrary, many of the benefits classified under the category of maternity benefits, including maternity leave, are also listed under the category of family benefits. The difficulty experienced in distinguishing these two fields at the national level of the Member States indicates how difficult the distinction will be at the Community level. We now turn to the criteria of the definition of maternity benefits within the framework of Reg 1408/71 as laid down by the Court. b. Maternity Benefits within the Framework of the Co-ordination Law The Court has made it clear that the concept of ‘sickness and maternity benefits’ referred to in chapter one of Title III is to be determined in accordance with Community rules defining what those benefits are to consist of, and not according to the type of national legislation on which the benefits are grounded.153 With regard to maternity benefits in particular, the Court has laid down certain criteria that help in classifying a benefit as a maternity benefit. In Commission v Luxembourg,154 the Commission sought a declaration that, by imposing residence requirements in relation to childbirth and maternity allowances, Luxembourg had failed to fulfil its obligations under Community law. One of the provisions at issue in the case was Art 18(1) of Reg 1408/71. The childbirth allowance was split into three instalments: the prenatal allowance, the childbirth allowance proper, and the postnatal allowance. The Commission challenged the conditions of the grant as regards the first two instalments. The first instalment was paid when the mother-tobe had undergone the last of the medical examinations required by the legislation. It was a precondition that the mother-to-be should be ‘officially resident’ in the country for the year preceding the birth of the child and have attended all the 152 153 154

See also Case C-111/91 Commission v Luxembourg [1993] ECR I-817. Case 69/79 Jordens-Vosters [1980] ECR 75. Case C-111/91 [1993] ECR I-817.

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The Exportability Principle 245 medical examinations required by the legislation. The second instalment was paid after the birth of the child, but only if three conditions were met: the birth must take place in Luxembourg (or in foreign territory if the mother was absent on reasonable grounds); one of the parents must be officially resident for a year in Luxembourg at the time of the birth; and the mother must undergo the postnatal examination. Maternity allowance, on the other hand, is paid to every woman who is pregnant or has given birth, provided that she has been officially resident in Luxembourg for the entire year preceding the beginning of her entitlement, or that her husband has been officially resident in the country for three years preceding the entitlement benefit. The allowance is paid on demand for a maximum period of 16 weeks, beginning with the eighth week preceding the presumed date of birth, as evidenced by a medical certificate. This precondition of residence in the territory of Luxembourg, in the Commission’s view, conflicted with Art 18(1) of Reg 1408/71, which concerns the aggregation of qualification periods for the acquisition of the right to maternity benefits.155 It should be noted here that only the national provisions on maternity benefits, according to the Commission, were in breach of Reg 1408/71.156 The final outcome of the case was that the Court held that by imposing residence requirements for the granting of childbirth and maternity allowances, Luxembourg had failed to fulfil its obligations under Art 7(2) of Reg 1612/68, Art 18(1) of Reg 1408/71, and Art 52 of the Treaty. The Luxembourg Government maintained that the maternity allowance was outside the scope of Reg 1408/71 at the time, that is to say before the amendment of Reg 1408/71 by Reg 1247/92.157 The Commission argued, on the other hand, that the benefit already fell within the scope of Reg 1408/71 even before the amendment of the Regulation. The Court held, adopting the same view as that of the Advocate General, that the disputed benefit was a social security benefit. As the Court noted, the provisions concerning the benefit confer upon the recipient first a legally defined right, without any individual or discretionary assessment of personal needs, and, secondly, maternity benefits are expressly mentioned in Art 4(1) of Reg 1408/71. Consequently, these two elements must be considered constituent parts of the concept of maternity benefits. The Court also held that the non-contributory character of the benefit does not exclude it from the scope of Reg 1408/71 as the Regulation expressly applies to non-contributory schemes.158 155

Above, at I, 1.2 a. The provisions on childbirth allowance, according to the Commission, were in breach of Art 7(2) of Reg 1612/68 and Art 52 of the Treaty. The maternity benefit provisions were also in breach of the same articles, apart from them being in conflict with Reg 1408/71. 157 [1992] OJ L136/1. Following that amendment, two new provisions, Art 4(2a) and Art 10a, as well as a new Annex IIa, were inserted in Reg 1408/71, with the result that the Regulation now applied to some special non-contributory benefits. The Luxembourg maternity allowance was expressly referred to in the text of the new Annex, and consequently there is no doubt that Reg 1408/71 became applicable to it, after its amendment. The proceedings, however, had been commenced by the Commission before the Regulation was amended, and therefore the question of application was raised. Later, however, the benefit was deleted from Annex IIa; see above n 43. 158 Paragraphs 30–31 of the judgment. See also para 30 of the Opinion of the Advocate General. 156

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246 The Application of the Fundamental Principles of Co-ordination The Advocate General, commenting on the alleged differences between maternity benefits and other social security benefits, stated: [T]he Luxembourg Government has not succeeded in demonstrating that maternity allowance falls outside the scope of Article 4(1) of Regulation No 1408/71. That provision expressly mentions ‘maternity benefit’ as a branch of social security covered by the regulation, a term which is apt to include, in particular, maternity allowance. Contrary to the view of the Luxembourg Government, it does not seem to me that maternity allowance can be distinguished from ‘classical’ schemes of social security in respect of its field of application, objectives and modalities of application . . . The Luxembourg Government has not pointed to any feature of Luxembourg maternity allowances which would distinguish it from other, allegedly more classical, schemes of maternity benefit. All such schemes presumably have as their object the welfare of the mother and the newly-born infant and award benefit for a limited period of time to all those who satisfy the conditions laid down for the receipt of the benefit.159 (emphasis added)

To summarise briefly, it appears that two criteria are to be taken into consideration in classifying a benefit as a maternity benefit: first, that it is conferred on the recipient as a legally defined right, without any assessment of personal needs. This is the common criterion applying to all social security benefits covered by Reg 1408/71. Secondly, it must refer to the risk of maternity. The nature of the benefit as contributory or non-contributory is not relevant. These criteria are quite general. According to them, all of the benefits mentioned above within the framework of the review of the national systems as maternity benefits in principle would be properly classified as maternity benefits within the meaning of the Regulation. That applies even with regard to the parental leave benefit. The problem, however, is that, as mentioned above, maternity benefits are often also classified as family benefits. Benefits with the same aim and the same characteristics can be classified differently in different national systems. These criteria, general as they are, cannot be of significant assistance in classifying different benefits under one branch of social security or another. In the Walsh case,160 the Court noted: [T]he benefits at issue in the main proceedings are allowances granted for a certain period before and after the confinement, even though the duration of that period and the amount granted per week or per day differ from one Member State to another, the grant of the benefits rests on the same concept of the welfare of the mother and child. The mother must enjoy a period of rest or leave from work and the allowances paid serve to make good, at least partially, any wage or salary which the mother might have drawn during that period.161 (emphasis added)

We can see from this description that maternity benefits are connected primarily to the period during which the mother is physically incapable of working. Second, they are to compensate the mother’s loss of income. Third, they are related to the welfare of the child. 159 160 161

Paragraph 31 of the Opinion of the Advocate General. Case 143/79 [1980] ECR 1639. Paragraph 16 of the judgment.

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The Exportability Principle 247 4.2 The Definition of Family Benefits In contrast to maternity benefits, Reg 1408/71 (as well as Reg 883/04) contains a definition of the term ‘family benefits’. Before discussing the definitions of the law of co-ordination, a few words will be said about the national systems of the Member States. a. Family Benefits in the National Systems of the Member States A review of the MISSOC database reveals that family benefits are perceived primarily as referring to child benefits. Such benefits are granted in all Member States, the amount sometimes being dependent on the number of children or their age. The concept of child benefits thus corresponds to the concept of family allowances. Other benefits that are typically categorised as family benefits are allowances for single parents, special allowances for handicapped children, accommodation allowances and removal grants. Not all of these benefits exist in all the Member States. Apart from these typical family benefits, benefits classified as maternity benefits in the maternity field of social security very often reappear under the family field, classified as family benefits. Examples of such double-classified benefits are birth grants provided in Belgium and Greece, and the German child-raising benefit. b. Family Benefits within the Framework of the Co-ordination System According to Art 1(u)(i) of Reg 1408/71, ‘family benefits’ are all benefits in kind or in cash intended to meet family expenses under the legislation provided for in Article 4(1)(h), excluding the special childbirth allowances mentioned in Annex II.162 Traditionally, family benefits are benefits intended to cover increased family expenses after the birth of a child. In all systems of the Member States, schemes exist to provide such benefits.163 Paragraph (ii) of Art 1(u) refers to ‘family allowances’. ‘Family allowances’ are periodical cash benefits granted exclusively by reference to the number and, where appropriate, the age of members of the family.164 It should be noted here that the term ‘family allowances’ is not used in the wording of either the title or the provisions of chapter seven of Reg 1408/71. The term exclusively used in chapter seven is ‘family benefits’. Family benefits include family allowances. Both are intended to provide compensation for expenses incurred in respect of dependants. However, a characteristic of family allowances is the fact that they are paid periodically, in cash, the amount varying with the number of children and their age, while family benefits in the strict sense of the term refer to 162

Annex II, in its second part, contains a list of special childbirth or adoption allowances excluded from the scope of Reg 1408/71, in accordance with the declarations made to this end by the Member States. 163 J Schell,‘European Social Security Systems’ in D Pieters (ed), Social Security in Europe: Miscellanea of the Erasmus Programme of Studies Relating to Social Security in the European Communities (Brussels, Bruylant and Maklu Uitgevers, 1991), at 104. 164 See also Case 313/86 Lenoir [1988] ECR 5391. A student grant provided directly to a child is not a family allowance within the meaning of Art 1(u)(ii) (Case C-33/99 Fahmi et al [2001] ECR 2415).

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248 The Application of the Fundamental Principles of Co-ordination the other types of benefits obtaining in the Member States.165 The term ‘family allowances’ is often used in the Community case law, even when it obviously refers to ‘family benefits’, thus causing some linguistic confusion.166 The term ‘family allowances’ is deleted in Reg 883/04. The new Regulation refers only to family benefits, which are defined in Art 1(z) as all benefits in kind or in cash intended to meet family expenses, excluding advances of maintenance payments and special childbirth and adoption allowances mentioned in Annex I. The development of a variety of national schemes, providing benefits intended primarily to facilitate child-rearing, has raised the difficult question of whether such benefits should be included in the concept of family benefits. In the Offermans case,167 the Court held that a benefit can be a family benefit within the meaning of the Regulation, even if the beneficiary is the child.168 In analysing the concept of family benefit, particularly as regards the criterion referring to its purposes and the conditions on which it is granted, the Court held that as far as the identity of the beneficiary of the right is concerned, it makes no difference whether the recipient of the benefit is the child since, as a self-employed worker, the parent having custody of the child is a person covered by Reg 1408/71.169 It should be noted here that the case concerned a category of benefits called Advances for the Maintenance of Children, which in the national classification usually appears as an allowance for single parents, and which is typically regarded as a family benefit. Despite the benefit’s classification in the national systems and the Court’s precedent, however, the benefit is now excluded from the scope of Reg 883/04, as stated above. Later case law has held that benefits intended to help families meet the cost of supporting their children between 16 and 21 years of age and who are unemployed, fall within the definition of Art 1(u)(i) of Reg 1408/71.170 4.3 The Distinction between Family Benefits and Maternity Benefits and the Classification of the Parental Benefit in the Law of Co-ordination The distinction between maternity benefits and family benefits might at first sight appear to be simple and clear. Maternity benefits aim to protect against the risk of incapacity to work by reason of childbirth, while family benefits aim to help families meet the increased expenses following childbirth and the creation of a family. 165 M Delprat, ‘Family Benefits’ in European Commission, Social Europe 3/92, at 46. Examples given are the education allowance in Luxembourg and one-parent benefit in the United Kingdom. 166 The distinction, however, may be very important in some contexts. In the Fahmi case (C-33/99 [2001] ECR 2415), for example, the Court clarified that student grants are not family allowances but reserved its answer to whether they are a family benefit within the meaning of Art 1(u)(i) (para 35 of the judgment). 167 Case C-85/99 [2001] ECR I-2261. See also Case C-255/99 Humer [2002] ECR I-1205. 168 Cf the Laumann case (115/77 [1978] ECR 805) concerning family allowances, where the Court had ruled that the direct and sole recipient of the allowances is the worker herself/himself (para 7 of the judgment). 169 Paragraph 34 of the judgment. 170 See Cases C-228/88 Bronzino [1990] ECR I-531; C-12/89 Gatto [1990] ECR I-557.

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The Exportability Principle 249 However, it soon becomes obvious that distinguishing between these two categories of benefit may not be an easy task, especially against the background of a variety of different national systems with different philosophies and goals. As shown above, even a quick glance at the national systems of the Member States reveals the difficulties involved in classifying the benefits, which result in the double classification of certain benefits. Most difficulties of classification arise with respect to benefits intended to facilitate care of children, particularly when they are connected with parental leave. No certain classification criteria emerge from other reviews of the national systems. In Pieters’ review of national social security systems,171 the Austrian maternity benefit, granted to mothers for a period before and after confinement under the sickness insurance scheme, is classified as a benefit for incapacity to work, while the parental benefit awarded to parents who interrupt work (without payment) is classified as a family benefit, despite its close link to unemployment insurance.172 The Belgian maternity benefit, despite its similarity to the sickness benefits, is classified as a family benefit.173 The Danish parental benefit is classified as a benefit for incapacity to work.174 The Finnish daily maternity allowance, granted irrespective of the beneficiary’s participation in the labour market, is classified as a benefit for incapacity to work, while the maternity/paternity benefit, calculated as the sickness daily benefit, is classified as family benefit, together with child home care allowance.175 The French income-related maternity benefit, granted on the same conditions as sickness benefits, is classified as a benefit for incapacity to work,176 like the German income-related maternity benefit177 and the British contributory maternity allowance.178 The Greek maternity benefit, granted as a sickness benefit, and the Irish maternity allowance are also classified as benefits for incapacity to work.179 The income-related Italian and Luxembourg maternity benefits are classified as benefits in respect of incapacity to work,180 and the same goes for the Dutch maternity benefit, which is granted under the sickness insurance scheme.181 The Portuguese income-related maternity benefit, granted on conditions similar to sickness benefits, and the Spanish income-related maternity benefit, which can be granted even to fathers under some conditions, are classified as benefits in respect of incapacity to work,182 while the Swedish income-related parental benefit is classified as a family benefit.183 171

D Pieters, Social Security Law in the Fifteen Member States of the European Union (Antwerp, Maklu,

1997). 172 173 174 175 176 177 178 179 180 181 182 183

Ibid, at 27 and 31 respectively. Ibid, at 48. Ibid, at 64. Ibid, at 81 and 86 respectively. Ibid, at 100. Ibid, at 120. Ibid, at 139. Ibid, at 160 and 179. Ibid, at 192 and 209. Ibid, at 230. Ibid, at 247 and 265. Ibid, at 282.

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250 The Application of the Fundamental Principles of Co-ordination Thus, no clear criteria of classification of the benefits or the relevant schemes can be distinguished in this review of the national systems. It cannot be maintained that the more similar a maternity benefit is to a sickness benefit, concerning its conditions of award or the basis of its calculation, the more likely it is to be classified as a benefit in respect of incapacity to work. This does not explain why the Belgian benefit, for instance, is classified as family benefit, or why the Swedish benefit, which is calculated on the same basis as sickness benefit, is classified as family benefit. It cannot be maintained either that parental benefits should be classified as family benefits, because this does not explain why the Danish parental benefit, for instance, is classified as a benefit in respect of incapacity to work. The distinction between maternity benefits and family benefits is blurred. Similar benefits may be classified as maternity or family benefits under national laws. This is particularly true with regard to parental benefits. This must be attributed to the varying goals of the benefits in the national policies and to the different social models that each state endeavours to establish. This complicated background has already made classification of the parental benefit under Reg 1408/71 in relation to the application of the principles of co-ordination an extremely difficult task. The problems involved in and impact of classifying the parental benefit supported by the Court are discussed below, following discussion of the emergence and notion of the parental benefit. a. The Emergence and Notion of the Parental Benefit The parental benefit is often connected to parental leave. This means that the benefit is paid to employed parents who interrupt their work in order to take care of a minor child. The aim of the benefit is to make such a work interruption possible. The European Commission notes in the explanatory memorandum to the 1983 draft Directive on parental leave that the term ‘parental leave’ is taken from ILO Recommendation No 165 of 1981. They refer to the leave granted to fathers and mothers during a period after the termination of maternity leave to enable parents in employment to look after their newborn child for a certain time, whilst giving them some degree of security in respect of employment, social security and remuneration. Parental leave is also granted to adoptive parents. Central to this and subsequent definitions of parental leave, therefore, is the fact that the entitlement must be equally available to mothers and fathers and to adoptive as well as biological parents.184 Parental leave can be organised on a family or an individual basis. The former means that both parents have a shared right to leave. The individual basis gives parents a non-transferable and reserved right to (a portion of) the leave. Workers in most countries have a family right to parental leave. This means that the right to parental leave for fathers is a derived right: the father is only entitled if the mother is also entitled and waives her right to leave.185

184

P Moss and F Deven, above n 149, at 3. See European Commission, Equal Opportunities for Women and Men in the European Union (Luxembourg, Office for Official Publications of the European Communities, 1996), at 64. 185

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The Exportability Principle 251 Parental leave was introduced as a complement to extended maternity leave. The period of maternity leave attributable to the physical incapacity of mothers before and after confinement was followed by another period of leave granted to mothers which was also covered by the social security system. A shared (family) right to parental leave, for both fathers and mothers, was developed later. Different Member States have followed various policies in this area, depending on the emphasis each country has placed on the model of the dual-breadwinner family. Ferrarini points out that cross-national differences were relatively minor in the first post-war decades, but divergences in parental leave institutions increased in the 1970s, when fathers also became recognised as potential carers in paid paternal leave legislation. The inclusion of fathers follows the lines of two separate dimensions of family policy, the first supporting the dual-earner family type, and the second mainly preserving traditional family patterns.186 Montanari has shown that there has been a growing divergence in national policies with respect to child benefits and marriage subsidies, indicating a reinforcement or gradual decrease in political support for the single breadwinner or the dual-earner family model.187 Parental benefit may be granted even to non-working parents. In such cases, the benefit is not of course intended to facilitate a work interruption; it may, however, be intended to enable a parent to devote him/herself to child-rearing. In such a case, the award of the benefit is based on the condition of residence within the national territory. In some Member States, such as Sweden, the systems include both employment-related and residence-based benefits. Within this context of differentiated national schemes aimed at achieving different objectives and realising different social and family policies, the classification of the parental benefit is difficult, whether granted to working or non-working parents, under one of the branches of social security covered by Reg 1408/71 (as well as Reg 883/04), for the purpose of the application of the fundamental co-ordination principles of aggregation and exportability. This issue of classification, as well as the issue of the impact of the classification of the benefit on each parent’s right to export the benefit, are discussed in the following sub-section. b. Classification of the Parental Benefit under Reg 1408/71 In the Hoever and Zachow cases, the Court laid down some criteria with the aim of clarifying the Community concept of ‘family benefits’ and classifying certain national benefits as such.188 Joined Cases Hoever and Zachow189 Ms Hoever and Ms Zachow, like their husbands, were German nationals and lived in the Netherlands. Ms Hoever had been working for 10 hours a week in Germany since June 1990. When her son was born, she took an 18-month long child-raising leave. Ms Zachow had not been employed since 1985. Both husbands were in full-time employment in Germany. 186 T Ferrarini, Parental Leave Institutions in Eighteen post-war Welfare States (Stockholm, Swedish Institute for Social Research, Dissertation Series Nr 58, 2003). 187 I Montanari, ‘From Family Wage to Marriage Subsidy and Child Benefits: Controversy and Consensus in the Development of Family Support’ (2000) 10 Journal of European Social Policy 307. 188 See also Case C-79/81 Hughes [1992] ECR I-4839. 189 Joined Cases C-245/94 and C-312/94 [1996] ECR I-4895.

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252 The Application of the Fundamental Principles of Co-ordination On 30 May 1991 and 28 December 1987 respectively, Ms Hoever and Ms Zachow applied in Germany for child-raising allowance for their sons, born in 1991 and 1987 respectively. The applications were rejected on the grounds that, by reason of her limited number of working hours, Ms Hoever was not an employed person, and that Ms Zachow resided in the Netherlands. As seen in the cases, German childraising allowance is a non-contributory benefit forming part of a set of family policy measures. It is granted pursuant to the German Federal Law on the grant of child-raising allowance and child-raising leave. According to that law, any person who (1) is permanently or ordinarily resident in the territory where the law applies, (2) has a dependant child in her/his household, (3) looks after and brings up that child, and (4) has no, or no full-time, employment, is entitled to benefits. Community nationals not residing but employed in Germany can claim the benefit so long as they are employed for more than 15 hours a week.190 Neither of the plaintiffs satisfied the national requirements since they were not resident in Germany. In addition, Ms Hoever’s limited employment was not sufficient to qualify her for the benefit according to the rules applicable for Community employees. One of the questions raised191 was whether a child-raising allowance such as the German allowance should be treated as a family benefit within the meaning of Art 4(1)(h) of Reg 1408/71. The Court answered in the affirmative and laid down two criteria for the classification of a benefit as a family benefit within the meaning of the Regulation: it has to be conferred without an individual and discretionary assessment of personal needs on the basis of a legally defined position, and it has to aim to meet family expenses.192 While the first criterion has not caused any particular difficulties of interpretation, the second criterion, that is to say the assessment of whether the benefit aims to meet family expenses, seems capable of causing considerable difficulties of interpretation. The discussion on this point in the Hoever and Zachow cases is illustrative. The German Government argued that child-raising allowance did not have the same purpose as a ‘family benefit’ within the meaning of Art 1(u)(i), since childraising allowance was intended, by conferring a personal right, to remunerate the particular parent taking on the task of raising a child and personally fulfilling the conditions for grant of the allowance. Furthermore, the German Government drew attention to the link between a child-raising allowance and child-raising leave. The Court disagreed. It held that the aim of such a benefit was actually to meet family expenses and, thus, it fit within the definition of Art 1(u)(i) of the Regulation. The Court accepted, in principle, the argument of the German Government that the child-raising allowance is intended to enable one of the parents to devote him or herself to the raising of a young child. However, it did not accept that the mere or the main aim of the benefit was to remunerate the parent 190 191 192

Fifteen hours is the threshold for entering the social security system. For the other issues in the case, see below ch 7, at II, 1.4. See also Case C-85/96 Martinez Sala [1998] ECR I-2691.

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The Exportability Principle 253 concerned. In the Court’s opinion, the benefit had a multiple meaning and a multiple purpose: ‘[T]he allowance is aimed more particularly at remunerating the service of bringing up a child, meeting other costs of caring for and bringing up a child and, as the case may be, mitigating the financial disadvantages entailed in giving up income from full-time employment.’193 Describing this aim, the Court laid down, at the same time, the elements for family expenses: (a) remuneration for the service of bringing up a child; (b) other costs of caring for and bringing up a child; and (c) financial disadvantages entailed in giving up income from full-time employment. However, it did not clarify whether all the criteria must be satisfied for a benefit to be classified as a family benefit, or whether satisfying only one criterion is sufficient. The Court further held that the link between the child-raising allowance and child-raising leave, to which the German Government had drawn attention, cannot remove the allowance from the scope of Arts 1(u)(i) and 4(1)(h) of Reg 1408/71. This follows from the fact that the benefit is granted to the recipient, whether or not s/he is an employed person.194 The Advocate General was of the same opinion as regards the nature of the benefits. He emphasised, for instance, that a benefit can aim to meet family expenses even in cases where there is no loss of income. In his opinion, family benefits by their nature cannot be regarded as payable to an individual in isolation from family circumstances. Since the grant of a benefit such as the German child-raising allowance is intended to meet family expenses, the choice of the parent who is to receive the allowance is of no importance. ‘Common sense’ suggests that payment of the benefit to an economically non-active parent will help to meet family expenses.195 Parental leave benefit was also discussed in the Kuusijärvi and Maaheimo cases. The Kuusijärvi Case196 This case concerned a Finnish national who worked in Sweden for 11 months until 10 February 1993. Thereafter, she drew unemployment benefits until 1 February 1994, the date on which her child was born. She was then granted the child allowance provided for under Swedish legislation, and also the parental benefit (föräldrapenning).197 On 24 May 1994 Ms Kuusijärvi informed the social security office with which she was registered that she intended to transfer her residence to Finland and enquired as to whether she would continue to receive parental benefit after that change of residence. On 1 July 1994 Ms Kuusijärvi established residence in Finland but did not work there. Her application to continue to draw parental benefit after moving to Finland was rejected by the Swedish social insurance office on the ground that she had been removed from the Swedish social security register after she moved to Finland; in other words, she did not fulfil the condition of residence in Sweden for the award of benefits. Under the applicable Swedish law, the people insured are Swedish citizens and non-Swedish nationals 193 194 195 196 197

Paragraph 25 of the judgment. Paragraph 26 of the judgment. Paragraph 30 of the Opinion of the Advocate General. Case C-275/96 [1998] ECR I-3419. Above, at 4.1 a ii.

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254 The Application of the Fundamental Principles of Co-ordination residing in the national territory. An insured person who leaves Sweden continues to be regarded as resident in Sweden if their stay abroad is not intended to exceed one year. However, someone who is covered by Reg 1408/71 and moves to another Member State is to be removed from the register of the social security office as soon as s/he becomes subject, in accordance with that Regulation, to the legislation of the host state, even if s/he intends to stay there for less than a year. Ms Kuusijärvi appealed the decision. The case raised several questions regarding the interpretation of Community law.198 One question concerned the application of Art 22 of Reg 1408/71. The national court asked the Court whether the proper interpretation of Art 22 meant that a person who begins to draw cash maternity benefits in a competent state retains entitlement to those cash benefits when moving to another Member State only on the condition that the person concerned satisfies all the provisions of the applicable national legislation, including the residence requirement, or whether it is enough that s/he satisfies all the other conditions apart from the residence requirement. In other words, the question, as the Court reformulated it, was whether Art 22 of the Regulation precludes the legislation of a Member State from providing that a person who has ceased all occupational activity in its territory loses the right to continued payment of a parental benefit, on the ground that this person has transferred his/her residence to another Member State. It should be noted here that the residence clauses in the national legislation do not apply to persons who are covered by Reg 1408/71. Ms Kuusijärvi was found to be covered by Reg 1408/71. Pursuant to Art 13(2)(f), she was subject to the legislation of the Member State of residence, ie Finland. That provision stipulates that the person concerned is to be subject to the legislation of the Member State of residence in accordance with the provisions of that State alone.199 Despite that, the Court proceeded to discuss the question of the exportability of the benefit by virtue of Community law.200 Nevertheless, the Court considered that the answer to the question first required the benefit in question to be classified. This was necessary in order to establish whether Art 22 was applicable at all. Classification also appears to have been necessary considering the background to the situation: when Reg 1408/71 entered into force in Sweden, the Swedish Government had categorised parental benefit as a maternity benefit. In its observations before the Court within the framework of the Kuusijärvi case, however, the Swedish Government submitted that, in view of the Court’s ruling in the Hoever and Zachow cases, the benefit at issue should consequently be regarded as a family benefit within the meaning of Reg 1408/71. The Court confirmed its judgment in the Hoever and Zachow cases by finding that the Swedish parental benefit satisfied the criteria laid down in these cases. In 198

See also ch 4, at II, 1.2 b ii. Above, ch 4 at II, 1.2 b. 200 The Advocate General was of the opinion that Reg 1408/71, in particular Art 22, was applicable in the case despite the fact that the person concerned, as a consequence of Art 13(2)(f), was subject only to the legislation of the Member State of residence. 199

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The Exportability Principle 255 particular, the Court found that the Swedish parental benefit was intended to enable one of the parents to devote him- or herself to raising a young child, to remuneration for the service of bringing up a child, to meet the other costs of caring for and raising a child, and to mitigate the financial disadvantages entailed in giving up income from an occupational activity. The Court stated: [A]lthough it is true that the mother is eligible for parental benefit with effect from the 60th day before the day on which the child is due to be born, it is nevertheless the case, therefore, that during by far the greater part of the period for which parental benefit is payable, the right to that benefit belongs to the parent who primarily has care of the child; that right may therefore also accrue to the father. Moreover, the amount of benefit is, subject to certain conditions and reservations, directly determined by the amount of the earned income of the parent concerned … Those detailed rules show that parental benefit is intended, on the one hand, to enable the parents to devote themselves, in alternation, to the care of the young child until the child has started to attend school and, on the other, to offset to some extent the loss of income entailed for the parent devoting himself or herself to the care of the child in temporarily giving up his or her occupational activity.201

Consequently, the Court held that the case was not to be decided on the basis of the maternity benefit provisions, in particular Art 22, but on the basis of family benefit provisions, which are included in chapter seven of the Regulation. Thus the question of whether Art 22 applies to persons who have ceased occupational activity and are in receipt of family benefit was never answered. The question was substituted with that of whether such a person was covered by the applicable provisions of chapter seven instead.202 The Maaheimo case 203 This case concerned a Finnish national who, having obtained parental leave, cared for her children at home. Finnish legislation provides parents or other people having custody of a child with an option: they have a right to a place in a day-care institution from the time entitlement to parental benefits expires until the child attains the age of compulsory schooling, or, if they choose to not claim a day-care place, they are entitled to a home child-care allowance. The condition for payment of the allowance is that the child actually lives in Finland. Ms Maaheimo had been in receipt of the home child-care allowance since 8 January 1998. Her husband worked in Germany as a posted employee from 10 July 1998 to 30 April 1999. The family joined him and stayed with him in Germany from 10 July 1998 to 31 March 1999. During that period, the entire family was subject to the Finnish social security legislation. The competent Finnish institution ceased payment of the home childcare allowance on the ground that the children were not actually resident in Finland. The Court found that the condition must be considered to be satisfied where the child resides in the territory of another Member State by virtue of Art 73 of Reg 1408/71.204 Article 73 was the applicable article since the benefit was classified as family benefit. Thus, the benefit had to be paid by virtue of Community law. 201 202 203 204

Paragraphs 63–65 of the judgment. Above, n 61. Case C-333/00 [2002] ECR I-10087. Above, at 1.2 d.

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256 The Application of the Fundamental Principles of Co-ordination c. Classification of the Parental Benefit and Application of Different Provisions of the Co-ordination Regulations The Hoever and Zachow, Kuusijärvi and Maaheimo cases illustrate the various national approaches to parental benefits that may exist in several forms. On the one hand, there is the German approach, as illustrated by the Hoever and Zachow cases. Accordingly, the benefit aims at remunerating the (potentially non-working) parent who raises a child. This approach obviously reflects the values and aspirations of the German system. On the other hand, there is the Swedish approach, where the aim is to compensate the working parent for the income loss s/he suffers during the period of caring for the child.205 As the primary assumption and objective of the Swedish system is that all adults irrespective of sex participate in production, the benefit aims at making a work interruption possible. A consequence is that the benefit cannot be paid at the same time as salary is paid.206 The Finnish benefit, which involves extended parental leave, seems to combine elements from both of the previous approaches. The Court had just one approach in all of these cases: the benefits at issue were family benefits. In the Court’s opinion, features such as remuneration for the service of bringing up children and compensation for income loss simply constitute elements of family benefits. Commenting particularly on the Kuusijärvi case, the Court’s understanding of the Swedish parental benefit appears to have had a twofold aim: to enable parents to devote themselves to caring for a young child; and to offset to some extent the loss of income entailed by the parent taking care of the child. The Court found that this twofold aim fit with the Community definition of family benefits. It perhaps comes as no surprise that the Court drew this conclusion, since the Swedish Government itself had re-classified the benefit as a family benefit. However, the question is whether the Swedish parental benefit really does fit that well with the Community concept of family benefits. It should be noted that the Swedish benefit not only has similarities with the German child-raising allowance at issue in the Hoever and Zachow cases, it also displays significant differences. The Swedish benefit at issue is employment-based. It presupposes an interruption of the employment relationship—actually aiming at making it possible—and income loss. The amount is income-related and is granted only to the entitled worker.207 The character of the entire Swedish system focuses strictly on the individual worker.208 The Swedish benefit obviously fits better with the concept of maternity benefits as described in the Walsh case.209 As it emerges from the Hoever and Zachow cases, the German allowance may be linked to parental leave, but it is not totally intertwined with it, as 205 The two approaches obviously reflect the two different perceptions concerning the role of women as embedded in the systems. See ch 2. 206 The financing of leave is a point of differentiation among the national systems. In some Member States, wages continue to be paid, in others not. 207 A Christensen, ‘Social Security Law’ in M Bogdan, Swedish Law in the New Millennium (Stockholm, Norstedts Juridik, 2000), at 135. 208 Ibid. For a discussion as to the individualistic character of the Swedish system and a comparison between the Swedish and Netherlands systems, see G Therborn, ‘ “Pillarization” and “Popular Movements”. Two Variants of Welfare State Capitalism: The Netherlands and Sweden’ in GF Castles (ed), The Comparative History of Public Policy (Oxford, Polity Press, 1989). 209 Above, at 4.1 b.

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The Exportability Principle 257 the Swedish benefit is. The German allowance discussed in the cases can be conferred even on a non-employed person. It is conferred irrespective of whether there has been any loss of income. This latter feature is utterly unconceivable in the Swedish system. The benefit there aims simply to compensate for income loss.210 The Court seems to have completely missed or ignored the strictly individual and employment-related nature of the Swedish benefit. Certain authors have expressed the view that it is not inconceivable that the Court will reach a different conclusion in another case.211 Once of the main differences between the Court’s approach and the national approaches, at least as far as we can see from the Hoever and Zachow and Kuusijärvi cases, is that the Court places the emphasis on the family, while the national approaches, despite their differences, place the emphasis on the individual parent. The Court has thus shifted the weight from the individual to the family. Such a shift can produce its own winners and losers, and for a time it seemed able to create problems for women interrupting work to raise children with regard to their ability to export family benefits (including parental leave benefits. Thus, while non-working spouses could invoke Art 73 of Reg 1408/71 by virtue of their capacity as family members (on the basis of the Hoever and Zachow precedent), it was not certain whether working women could do the same.212 Seen from the perspective of individual systems promoting the dual-breadwinner or weak-male breadwinner model, this was a detrimental development for the social security rights of the people concerned, the majority of whom are women.213 Against this background, the question to be posed was whether all benefit classifications related to childraising, irrespective of the traits of national legislation and the social policy goals or the nature and the purpose of the particular benefit, as family benefits could be seen as the correct basis. Nevertheless, this uncertainty was finally dissolved by the Dodl and Oberhollenzer case, where the Court laid down that people interrupting work are still to be regarded as employed persons within the meaning of Art 73 and consequently are entitled to the particular exportability right established in it.

210 The Swedish system also contains a residence-based benefit, which is conferred irrespective of whether the beneficiary has had a job and without any requirement of income loss. Obviously, that part of the Swedish parental protection system is more similar to the German allowance. The Kuusijärvi case, however, concerned the income-related part of the parental benefit, not the residence-related part. The German benefit also displays similarities with the cash benefit to mothers (vårdnadsbidrag) advocated in Sweden by political parties on the right of the political spectrum. 211 A Kjönstad,‘Rett till “föräldrapenning” og födelspenger etter flytting mellom EÖS—land’ in Ann Numhauser—Henning, above n 148, at 200. However, Ms Kuusijärvi was finally able to export the benefit. The final outcome of the case, when it was again addressed in the national court after the preliminary ruling of the Court of Justice, was that plaintiff was entitled to the benefit in the capacity of a family member by virtue of Art 73. It had become known in the meantime that during the period in question she was married and that her husband worked and resided in Sweden. This entailed that Sweden was the competent state for the payment of benefits as the Member State of employment of her husband. 212 See V Paskalia, Free Movement of Persons and Social Security—Gender Implications of EC Regulation 1408/71 (University of Stockholm, 2004) 213 See also E Rentola, above n 6, at 327; M Sakslin, above n 2, at 184.

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258 The Application of the Fundamental Principles of Co-ordination However, problems still remain. The award of a benefit classified as a family benefit is subject to priority rules, which may ultimately mean that a female worker is deprived of employment-related benefits due to the application of these rules, as discussed in the next section. From this point view, it is better if benefits are classified under the maternity branch of social security, where no priority rules apply.

III. THE NON-OVERLAPPING PRINCIPLE

While the aggregation and exportability principles were examined with regard to four benefits, ie sickness/maternity, old age, family and unemployment, the nonoverlapping principle will be examined with regard to just one category of benefits: family benefits. The phenomenon of overlapping (also referred to as duplication, plurality or cumulation) social security benefits is familiar in all social security systems. At the national level, it takes the form of the availability of two or more benefits in respect of the same or essentially similar risk or contingency, each of which is calculated at a rate assuming the non-availability of the other.214 At the trans-national level, there is an additional dimension to the problem: a person may acquire the right to different benefits in respect of the same risk in two or more Member States but s/he may also qualify for the same benefit in two or more Member States.215 When it comes to family benefits, there is though a further dimension: two different persons may qualify for the same benefit in more than one Member State for the same reason, ie on account of the same child.216 One result of applying the co-ordination principle of non-overlapping is that the right of one beneficiary takes precedence over the right of the other. Consequently, while the application of other co-ordination principles, such as aggregation and exportability, help the person covered to acquire rights under national legislation or retain acquired rights in cases of movement, application of the non-overlapping principle results in depriving one of the people covered by the principle—one of the parents—of the right to family benefits. If such rights were acquired solely under national law, the Community rule against overlapping will lead to depriving that person of rights acquired under national law. Therefore, it is important to examine whether the Community nonoverlapping principle concerning family benefits covers people who have interrupted work for reasons of childbirth/child-rearing or migration. From a gender perspective, it will be very interesting to see whether the right of the worker who continues to work (usually the father) to family benefits in principle takes precedence over the right of the worker interrupting work because of childbirth/ child214

AC Page, above n 1, at 211– 28. Ibid, at 213–15. See also Case 50/75 Massonet [1975] ECR 1473. 216 As the Court emphasised in the Dammer case (C-168/88 [1989] ECR 4553):‘[The] overlapping of benefits occurs not only when one person is entitled to two different family benefits at the same time, but also when two different people, such as for example both parents, are entitled to such benefits in respect of the same child.’ 215

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The Non-overlapping Principle 259 rearing (usually the mother) to the same benefits, as a consequence of the application of the Community prohibition against overlapping. Before examining the personal scope of the pertinent provisions of Reg 1408/71 in order to see which people are covered by this overlapping prohibition, we will first focus on the content of the principle.

1. The Provisions of Reg 1408/71 The content and the personal scope of the non-overlapping provisions are examined first with regard to Reg 1408/71 and then with regard to Reg 883/04. 1.1 The Content of the Non-Overlapping Principle in Relation to Family Benefits The general rule against overlapping is contained in Art 12 of Reg 1408/71. According to Art 12(1), Reg 1408/71 can neither confer nor maintain the right to several benefits of the same kind for a single period of compulsory insurance.217 According to Art 12(2), the provisions of the legislation of a Member State governing the reduction, suspension or withdrawal of benefits in cases of overlapping with other social security benefits or any other form of income may be invoked even where such benefits were acquired under the legislation of another Member State or where such income was acquired in the territory of another Member State, save as otherwise provided in the Regulation. The principle is reiterated in a number of provisions in Title III concerning specific benefits. Within the framework of the family benefits chapter, the nonoverlapping rule is contained in Art 76. In addition, a second type of priority rule for family allowances is contained in Art 10(1)(a) of the implementing Regulation 574/72.218 Article 76 of Reg 1408/71 concerns the situation where entitlement to family benefits is based on the pursuit of an economic activity.219 Article 10(1)(a) of Reg 574/72 concerns the situation where entitlement to family benefits in one Member State is based on the mere fact of residence in that State. a. Non-Overlapping Rules when the Benefits are based on the Pursuit of an Economic Activity Pursuant to Art 76 of Reg 1408/71, where family benefits are provided during the same period, for the same family member and by reason of carrying on an occupation, by the legislation of the Member State in whose territory the family members are residing, entitlement to the family benefits due in accordance with the legislation of another Member State, if appropriate under Article 73 or 74, is to be suspended up to the amount provided for in the legislation of the first Member State. 217 An exception is already introduced in the same paragraph. Article 12(1) continues by stating that this provision shall not apply, however, to benefits in respect of invalidity, old age, death (pensions) or occupational disease which are awarded by the institutions of two or more Member States, in accordance with the provisions of Articles 41, 43(2) and (3), 46, 50, 51 and 60(1)(b). 218 As last consolidated and updated by Reg 118/97 ([1997] OJ L28/1). 219 See also Art 10(1)(b) of Reg 574/72.

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260 The Application of the Fundamental Principles of Co-ordination The sole purpose of Art 76 is to restrict the possibility of overlapping entitlements to benefits. Consequently, where the benefits or allowances are not payable or are no longer payable in the Member State in whose territory the family reside, solely because they have not been applied for or re-applied for, the entitlement to family benefits or allowances of one of the parents in the Member State of employment under Art 73 is not to be suspended.220 Neither does the non-overlapping rule apply, if the reason for the non-receipt of benefits in the Member State of residence is that not all of the conditions laid down by the legislation of that Member State have been satisfied.221 As can be clearly seen from the wording of Art 76, the article applies when the provision of family benefits in the country of residence of the family members is based on the pursuit of an economic activity in that Member State. Thus one of the situations in which Art 76 applies is when a person pursues an economic activity both in the Member State of residence of her/his family and in another Member State, and is entitled to family benefits in both Member States by virtue of the economic activity. It makes no difference if the person entitled to the benefits is engaged simultaneously in paid employment in one Member State and selfemployment in another Member State. The Court held that Art 76 applies when the worker is engaged simultaneously in a secondary activity as a self-employed person in the Member State in which her/his family resides, and in an activity as an employed person in the territory of another Member State. The right to family allowances payable by the Member State of employment under Art 73 is suspended only up to the amount of allowances of the same kind actually paid in the Member State in whose territory the worker’s family reside.222 Another situation in which Art 76 applies is when both parents work and reside in different Member States.223 From a gender perspective, this is a most interesting situation. Whose right is to take precedence: that of the working father, or the right of the working mother? The Community law of co-ordination does not approach the issue from the perspective of the individual parent. The main aim of the system is to prevent any overlapping of benefits irrespective of which parent’s right takes precedence. On the other hand, it is important that the application of the nonoverlapping principle does not deprive the parents together—the family—of family benefits owed under the legislation of one Member State. The Court has held that where the parents work and reside in different Member States, a non-overlapping rule is applicable only to the extent that it does not, without cause, deprive those concerned of an entitlement to benefits conferred on them by the legislation of a Member State. Thus, the payment of family benefits or family allowances payable under the legislation of the state of employment is suspended only up to the amount received in respect of the same period and the same member of the family 220 221 222 223

Case C-117/89 Kracht [1990] ECR I-2781. See Cases 191/83 Salzano [1984] ECR 3741; 153/84 Ferraioli [1986] ECR 1401. Case 24/88 Georges [1989] ECR 1905. Case C-168/88 Dammer [1989] ECR 4553.

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The Non-overlapping Principle 261 in the state of residence by the spouse pursuing a professional or trade activity within the territory of that state.224 In cases where the two parents live and work in different Member States, even Art 10(1)(b)(i) and (ii) of Reg 574/72 are relevant. According to the latter paragraph, the professional or trade activity, which has the effect of reversing the priorities and making the legislation of the Member State of residence applicable instead of the worker’s state of employment, must be exercised or pursued in the state of residence by ‘the person entitled to the family benefits or family allowances, or the person to whom they are paid’. This phrase refers primarily to the term ‘spouse’, which it replaced, but it can also cover other people.225 More complicated problems occur when both parents work in different Member States and only one of them is entitled to benefits. An illustrative example is the McMenamin case.226 Ms McMenamin was a frontier worker who worked in the United Kingdom as a teacher in Northern Ireland but lived in Ireland with her husband and their four children. Her husband was employed in Ireland. According to Irish legislation, entitlement to child allowance is conferred on the person with whom the child normally lives. If the child lives with its mother and father, it is the child’s mother who is entitled to the allowance. Consequently, Ms McMenamin was entitled to the allowance in Ireland according to the national legislation. She was also entitled to British child benefit on the basis of her employment in Northern Ireland. Her husband was not entitled to family benefits in Ireland, although he worked there. Ms McMenamin applied for child benefits in Northern Ireland, where the competent authority decided that she was entitled only to a supplement, namely the amount necessary to bring the child benefits payable to her under the corresponding Irish legislation up to the level of child benefits payable under the applicable United Kingdom law. The question was whether Art 76 of Reg 1408/71 and Art 10(1)(b)(i) of Reg 574/72 were applicable. The situation was characterised by the fact that under the legislation of the state of residence, it was the frontier worker— who was also entitled to allowances paid by the state of employment—who was entitled to allowances, not her husband. The Court stated that the principle that may be invoked to decide when the suspension rules are to apply is as follows: where a person having the care of children exercises a professional or trade activity in the territory of the state of residence of those children, allowances payable by the state of employment pursuant to Art 73 are suspended. The suspension occurs 224

Case 104/80 Beeck [1981] ECR 503. This phrase replaced the term ‘spouse’ in an earlier version of Reg 574/72. That Regulation was amended by Reg 1660/85 after the judgment in the Robards case (149/82 [1983] ECR 171). In its former wording, Reg 574/72 provided for the suspension of allowances due on the basis of Art 73 of Reg 1408/71 from the state of employment only if the spouse exercised a professional or trade activity in the state of residence of the children (Case 104/80 Beeck [1981] ECR 503). After the Robards case, where the Court held that the suspension should also apply where the divorced spouse exercised an activity in the state of residence, the word ‘spouse’ was replaced by ‘the person entitled to the family benefits or family allowances, or the person to whom they are paid’. The Robards case is discussed in ch 7. 226 See Cases 191/83 Salzano [1984] ECR 3741; 153/84 Ferraioli [1986] ECR 1401. 225

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262 The Application of the Fundamental Principles of Co-ordination irrespective of who is designated as directly entitled to the family allowances by the legislation of the state of residence. What happens if both parents work in different Member States, where they are entitled to family benefits by virtue of their work, but reside together with their child in a third Member State? May the parents choose between the two countries of employment for the purpose of the grant of family benefits? Are they entitled to choose between the Member States and decide to receive the family benefit in the Member State that pays the most? These questions were raised in the Dammer case,227 where the Court found that the Community rules did not provide answers in a case such as that. The facts referred to a couple residing in the Netherlands with their child. Mr Dammer worked in Belgium while his wife worked in Germany. His application for child benefit in Belgium was refused on the ground that his wife received child benefit in Germany. The Court established that in such cases, a worker’s right to family benefits in the Member State of employment may be exercised where the amount of family benefits actually received (by a spouse) in another Member State is lower. The worker is entitled to an additional benefit, payable by the competent institution of the first state, equal to the difference between the two amounts. Regulation 574/72 was thereafter revised and a new Art 10(3) was inserted to that effect.228 b. Non-Overlapping Rules where One Benefit is not based on the Pursuit of an Economic Activity In several Member States, the provision of family benefits or allowances is not subject to conditions of insurance or employment. Such benefits, however, may overlap with benefits acquired on the basis of employment in another Member State. Article 10(1)(a) of Reg 574/72 is applicable in such cases, pursuant to which the entitlement to benefits or family allowances due under the legislation of a Member State, according to which the acquisition of the right to those benefits or allowances is not subject to conditions of insurance, employment or selfemployment, is to be suspended when, during the same period and for the same member of the family, benefits are due only in pursuance of the national legislation of another Member State or upon the application of Arts 73, 74, 77 or 78 of the Regulation, up to the sum of those benefits. Consequently, the benefits granted to economically active parents according to the legislation of the lex loci laboris take precedence over the benefits granted to the non-economically active parent in the Member State of residence. An important point to emphasise is that the non-overlapping rules apply irrespectively of whether the benefits in the Member State of employment are granted on the basis solely of the national legislation or on the basis of Art 73 of Reg 1408/71. This development followed from the Burchell case,229 which concerned a divorced and unemployed British national. The plaintiff lived in the United Kingdom with her two children, while her former husband resided in the 227 228 229

Case C-168/88 [1989] ECR 4553. See Reg 1945/93 ([1993] OJ L181/1). Case 377/85 [1987] ECR 3329.

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The Non-overlapping Principle 263 Netherlands where he was employed. Ms Burchell fulfilled all the conditions of eligibility for child benefit under British law, for which she applied in 1980. At the same time, her former husband received family allowances in the Netherlands for the same two children. According to the Dutch legislation, family benefits were paid even if the family were not resident in the Netherlands. At that time, neither British nor Netherlands law contained rules against overlapping. The British authority considered, nevertheless, that Ms Burchell’s right to child benefit should be suspended by virtue of the application of the non-overlapping rules of Reg 574/72, as her former husband was entitled to family benefits in the Netherlands. As the plaintiff was not engaged in any professional or economic activity, she could not rely on the rules discussed in the previous sub-section, pursuant to which the British benefit would be granted. In that particular case, the Court’s ruling was in favour of the claimant. The Court found namely that her right to benefits in the United Kingdom should not be suspended since, according to the wording of the applicable provision of Reg 574/72 at the material time, the non-overlapping rules applied only in cases where the benefits in the Member State of employment were due pursuant to Art 73 of Reg 1408/71. The right of her husband to family benefits in the Netherlands was based not on Art 73 of Reg 1408/71, but rather on the provisions of the national legislation. Thus, since the benefits were not paid by virtue of a Community provision, the Community non-overlapping rules could not apply. The case thus entailed a double payment of family benefits on account of the same children. Following that case, Regs 1408/71 and 574/72 were amended.230 The amendment entailed that the non-overlapping rules found within those regulations are applicable even where the right to benefits is acquired by virtue of the national legislation alone. The Community non-overlapping rules thus mean that a non-working parent’s right to family benefits acquired on the basis of the national legislation of the Member State of residence alone, is subordinate to the right of the working parent acquired on the basis of Community law or on the basis of the national legislation of the Member State of employment alone. This state of the law has the potential to lead to very adverse effects for the interests of the people interrupting work.231 The gender implications are obvious. 1.2 The Personal Scope of the Non-Overlapping Provisions None of the non-overlapping provisions of Reg 1408/71 or 574/72 makes any direct reference to the persons affected by them. The above analysis clearly shows, however, that both working and non-working people are affected. The employment status of the people concerned is therefore of no importance in answering the question whether the non-overlapping principle applies in a given case. In contrast, 230 231

Regulation 2332/89 ([1989] OJ L224/1). See Case 104/84 Kromhout [1985] ECR 2205, discussed in detail in ch 7.

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264 The Application of the Fundamental Principles of Co-ordination the employment status of the people concerned is of major importance in determining which concrete provisions of Reg 1408/71 and Reg 574/72 enumerating the priority rules should apply in each case. Within this context, determining the employment status of people who have interrupted an economic activity due to childbirth/child-rearing responsibilities or migration is critical, as discussed in below in sub-section 3.

2. The Provisions of Reg 883/04 The initial aim when introducing Reg 883/04 was to restructure the chapter concerning family rules by establishing one single rule according to which, where entitlements to benefits exist in several Member States, the benefits are paid by the Member State paying the highest amount, with the burden being shared in proportion to the number of states concerned. The solution finally settled on, however, was that the legislation of the Member State of employment would take priority. Thus, the rules established by the new Regulation are not significantly different from the rules and the state of law as developed under Reg 1408/71. 2.1 The Content of the Non-Overlapping Chapter eight of Reg 883/04 concerning family benefits pays a good deal of attention to the non-overlapping principle and the priority rules. According to Art 68, priority rules apply where, during the same period and for the same family members, benefits are provided for under the legislation of more than one Member State. These rules vary according to the legal bases of the benefits in the Member States involved. Thus, when benefits are payable by more than one Member State on different bases, the order of priority means that rights available on the basis of performing an activity as an employed or self-employed person come first, followed by rights available on the basis of receipt of a pension, and finally rights obtained on the basis of residence.232 In the case of benefits payable by more than one Member State on the same basis, some subsidiary criteria apply, namely: if the rights are available on the basis of an activity as an employed or self-employed person, the benefits awarded in the place of residence of the children take priority, provided there is such activity there. Additionally, where appropriate, the highest amount provided for by the conflicting legislations is paid.233 If rights are available on the basis of residence, the benefits to be awarded are the benefits in the place of residence of the children.234 232

Article 68(1)(a). Article 68(1)(b)(i). In the latter case, the cost of benefits shall be shared in accordance with criteria laid down in the Implementing Regulation. 234 Article 68(1)(b)(iii). Pursuant to Art 68(2), entitlements to family benefits by virtue of other conflicting legislation or legislations are to be suspended up to the amount provided for by the Community legislation and a differential supplement shall be provided, if necessary, for any sum that 233

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The Non-overlapping Principle 265 2.2 The Personal Scope of the Non-Overlapping Provisions Obviously, both working and non-working persons are affected by the nonoverlapping principle of Reg 883/04, and the employment status of the persons concerned is of relevance only in establishing the priority rules. These priority rules can affect the rights of people interrupting work, and several questions remain unanswered, as discussed in the following sub-section.

3. Work Interruptions and the Application of the Non-Overlapping Principle In this sub-section, an assessment will be made of the state of the law concerning the non-overlapping rules from the perspective of people having interrupted work because of childbirth/child-rearing or migration. 3.1 Work Interruption because of Childbirth/Child-rearing The application of the Community non-overlapping rules can, as shown above, negatively affect the right to family benefits of an economically non-active person. With regard to people having interrupted work because of childbirth/child-rearing, the interesting question is: Should they be regarded as economically active or economically non-active people, within this context? The answer to this question is of fundamental importance since it can lead to the application of different nonoverlapping provisions, with different results for the interests of the people concerned. Although it gradually becomes clear that these people are to be regarded as employed people, several questions remain. For instance, the question of whose rights Community law intends to protect first cannot be answered. The Dodl and Oberhollenzer case shows that it is not clear, for instance, whether the priority rules should be based on a ‘family’ approach, ie the place where the family’s main centre of interest lies should be decisive in determining which Member State is responsible for providing family benefits, or on an ‘individual’ approach, ie the employment status of the claimant should be decisive.235 As the Advocate General put it: ‘there is a fair amount of confusion about the correct interpretation and application of the provisions in the social security regulations on the allocation of competence between the Member State of employment and the Member State of residence in respect of the provision of family benefits in situations where the parents of a child work in two different Member States, but live together in one of these Member exceeds this amount. However, such a differential supplement does not need to be provided for children residing in another Member State when entitlement to the benefit in question is based on residence only. 235 See Opinion of Advocate General Geelhoed delivered on 24 February 2005, paras 15–17. The Advocate General holds the view that the priority rules should be based on a ‘family approach’; see para 34 of the Opinion. See also Opinion of Advocate General Kokott in Case C-153/03 Weide, delivered on 15 July 2004.

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266 The Application of the Fundamental Principles of Co-ordination States.’ The Court has not discussed this issue in this case. Although its ruling concerning the term ‘employed person’ within the meaning of Art 73 suggests an individual approach, the non-overlapping rules, which were decisive for the case, are based on a family approach. Regulation 883/04, on the other hand—which establishes a system similar to that established by Regs 1408/71 and 574/72,— despite its attempt to adjust the co-ordination system to national systems focusing on individuals, obviously adopts a ‘family’ approach in this respect.236 The new Regulation therefore does not do much to clarify the confusion. From the point of view of individual (female) workers interrupting work, this state of affairs may be detrimental to their interests and thus disappointing. In this respect, the coordination system is deficient and the development of a gender dimension becomes imperative. 3.2 Work Interruption because of Migration It is somewhat more difficult to pose the same question with regard to people having interrupted employment because of migration, but a practical scenario could perhaps be as follows: the person having interrupted work because of migration is entitled to family benefits in the Member State where s/he resides with spouse and children, while his/her economically active spouse is entitled to the same sort of benefits in a neighbouring Member State where s/he works as a frontier worker. The person in question is in receipt of unemployment benefits in the Member State of residence. Whose right to family benefits takes priority, the unemployed parent’s in the Member State of residence or the working parent’s in the Member State of employment? No legal source gives an answer to this question, and no certain answer based on a general assessment of the current state of Community law can be deduced. Case law clarifying some uncertainties, although scarce, exists only with regard to people interrupting work for childbirth/child-rearing. It is impossible to draw any conclusions as to the status of people interrupting work for reasons of migration that would enable priority rules to be established for such people.

IV. THE NEW PRINCIPLE OF ASSIMILATION OF FACTS 237

Cases like Kuusijärvi, Elsen and Kauer, as well as the Dodl and Oberhollenzer case, demonstrate the difficulties that exist in addressing the needs of workers whose work is interrupted due to family reasons on the basis of the traditional, funda236 According to Art 68(1)(b)(i), in the case of benefits payable by more than one Member State on the same basis, the order of priority shall be established by reference to the criterion of the place of residence of the children, and additionally, where appropriate, the highest amount of the benefits provided for by the conflicting legislations. 237 For an account of this principle see F Kessler, ‘Introductory Remarks on Assimilation of Facts’, paper presented at the symposium on Perspectives for further modernisation and simplification of the Coordination Regulation held in Helsinki, 26–27 May 2005.

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Concluding Remarks 267 mental principles of co-ordination, such as lex loci laboris, aggregation and exportability. The new Regulation makes some attempt to settle such issues, mainly through the choice of law provisions. However, apart from the fact that choice of law settlements may not always be satisfactory from a gender perspective, questions remain with regard to the efficiency of other principles of co-ordination, such as aggregation and exportability. The question that can therefore be posed is whether there are other provisions in Reg 883/04 that counter-balance such defects. The new principle of assimilating facts introduced by Reg 883/04 is particularly interesting from this point of view. The principle is entrenched in Art 5 of Reg 883/04 and it stipulates that where, under the legislation of the competent Member State, legal effects are attributed to the occurrence of certain facts or events, that Member State is to take account of like facts or events occurring in any Member State as though they had taken place in its own territory.238 It has been pointed that the assimilation of facts is not unknown under Reg 1408/71, although it appears to be more of a technique than a principle.239 It is difficult to foresee the precise effects of this new principle and to estimate whether it is going to work generally to improve the position of women, whether they are covered by the Regulation in their capacity as insured people or in their capacity as family members. In general, however, it can be seen as a positive development that can potentially strengthen the rights of migrant women concerning, for instance, the acquisition of social security rights in the competent Member State for child-rearing periods spent in another Member State.

CONCLUDING REMARKS

The aim of this chapter was to investigate the application of three principles of coordination in relation to people whose economic activity has been interrupted because of childbirth/child-rearing or migration. These categories of people are in general covered by both Reg 1408/71 and Reg 883/04, as enumerated in chapter four. This coverage, however, is practically meaningless if the fundamental principles of co-ordination permitting acquisition or retention of social security rights are not applicable to them. The first principle examined was the aggregation principle. With regard to the first group, namely people having interrupted work because of childbirth/childrearing, it has been shown that there is a difference between the two Regulations currently in force. Thus, according to Reg 1408/71: — When the benefits at issue are sickness/maternity benefits, the principle applies to the persons in question when the benefits at issue are residence238 Article 5(b). Furthermore, pursuant to Art 5(a) where, under the legislation of the competent Member State, the receipt of social security benefits and other income has certain legal effects, the relevant provisions of that legislation shall also apply to the receipt of equivalent benefits acquired under the legislation of another Member State or to income acquired in another Member State. 239 F Kessler, above n 237.

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268 The Application of the Fundamental Principles of Co-ordination based. In contrast, the issue is unsettled when the benefits at issue are employment-related. — When the benefits at issue are old age benefits, the question cannot be answered on the basis of the current state of law. The case law, however, shows that old age benefits concerning child-rearing periods can be acquired on other legal bases, in particular the Treaty provisions as to the right to free movement of citizens of the Union. — When the benefits at issue are unemployment benefits claimed by the person concerned in the capacity of an unemployed person in the Member State of new residence, the principle applies. — There is no answer when the benefits at issue are family benefits. Regulation 883/04, on the other hand, made the principle generally applicable to all persons covered by it with regard to all benefits. Consequently, the new Regulation has entailed betterment in this respect. The different wording of Titles I and III might however cause complications, even within the framework of this Regulation. With regard to the second group, namely people having interrupted work for reasons of migration, it has been shown that the aggregation principle applies concerning all the benefits at issue in this book on the basis of the explicit provisions of the pertinent chapters of Title III of Reg 1408/71, provided that the person concerned can be regarded as an unemployed person. Unemployed status requires certain conditions established in the national systems of the Member States and in Reg 1408/71 to be fulfilled. The possibility of a person whose work has been interrupted due to migration fulfilling such conditions may however be problematic, due in large part to the often ‘voluntary’ nature of unemployment in such cases of work interruption. The state of the law appears to be simpler under Reg 883/04 following the insertion of a general aggregation provision, although the risk of complications due to the different wordings in the Regulation should again be noted. The second principle of co-ordination coming into focus in this chapter was the exportability principle. With regard to the first group, namely people having interrupted work because of childbirth/child-rearing, it has been shown that people belonging to this category enjoy the limited exportability right concerning some benefits under Reg 1408/71 as well as the extended right of exportability under Reg 883/04. With regard to the second group, namely people interrupting work because of migration, it has been shown that their situation is quite problematic under Reg 1408/71, because a necessary condition for the application of the exportability principle is that the persons concerned are regarded as unemployed persons. To that end, they need to fulfil the requirements of a national unemployment insurance scheme. A major problem in this context can be the voluntary nature of the unemployment. By that is meant that the unemployed status of a person interrupting work because of migration is usually considered, or could be considered, to be self-induced. According to this assumption, it is the very actions or decisions of the

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Concluding Remarks 269 person concerned that cause the unemployment and several national systems do not cover self-induced unemployment. However, in cases where the people concerned are regarded as unemployed, they are entitled to export unemployment benefits for a certain period. They are also entitled to sickness/maternity benefits in another Member State and to payment of family benefits by the competent state irrespective of their or their family’s place of residence, on the basis of explicit provisions of the pertinent chapters of Title III. Regulation 883/04 seems to entail advantages in this respect, as the only condition that has to be fulfilled under the new Regulation is that of insurance under any branch of social security. To date, however, the Community’s law of co-ordination has not paid much attention to this issue, and has not yet taken any concrete steps towards protecting this category of working person who interrupts their economic activities for family reasons. With regard to family benefits in particular, the emphasis in this chapter has been on the importance of classifying benefits connected to the risk of maternity/ parenthood as maternity or family benefits. A person may be deprived of his/her right to family benefits as a consequence of the non-overlapping rules. Similar rules do not exist with regard to maternity benefits and therefore the issue of classification of pertinent benefits is of crucial importance. It has been shown, however, that such a classification is unclear and problematic. Particularly problematic is the classification of the parental benefit. The Court has generally classified the parental benefit as a family benefit, despite national differentiations as to the character and aim of the benefit. From the perspective of systems and benefits with individualistic and equal treatment aspirations, such results may not only be totally preposterous, they may also have an inhibiting effect on the free movement of workers. The third principle coming into focus in this chapter was the non-overlapping principle. This principle was examined only in relation to family benefits. It has been shown that the principle applies to both categories of people under consideration here in accordance with both Regulations. However, despite the fact that the law of co-ordination is slowly moving towards treating people interrupting work for childbirth/child-rearing as workers, several issues remain unsettled, which ultimately jeopardise the right of (female) workers in charge of child-rearing to family benefits. It appears that Community law will have to make a decision of principle as to whether it will adopt an individual- or family-focused approach in these issues, in other words whether the rights of the working mother will take priority over the rights of the working father. The status of workers interrupting work for reasons of migration is even more uncertain, as their employment status is not clear. Determining their status as economically active or non-active people, however, is critical as this leads to the application of different priority rules with different results. Such a determination, however, cannot be made on the basis of the current state of development of Community law, and the co-ordination system demonstrates a considerable gap in this respect. In general, the analysis has shown a considerable shortage of legal authority with regard to the many issues raised in this chapter. Most problems exist with respect to

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270 The Application of the Fundamental Principles of Co-ordination Reg 1408/71, while Reg 883/04 seems to entail improvements. The adoption of the more general term ‘insured person’ instead of ‘employed person’, as well as the strengthening and extension of traditional principles of co-ordination, such as aggregation and exportability in Reg 883/04, seems to be capable of solving a number of problems. Several issues remain unsettled, though, for instance the issue of entitlement to old-age benefits for periods devoted to child-rearing in another Member State. Confusion also exists concerning the different approaches to the priority rules with regard to family benefits, while issues regarding the entitlement of workers, who interrupt work for family reasons, to other social security benefits, such as unemployment benefits, have not even been addressed. The analysis has also shown the inability of the concepts and principles of coordination to cope with the problems of (female) migrant workers as caused by work interruption for childbirth/child-rearing purposes or migration. In several cases, issues could be settled only on the basis of European citizenship; that issue has, however, been left outside the analysis. It is of course too early to evaluate the impact of the new principle of assimilation of facts; we must wait for the new Regulation to take effect. A more satisfactory level of protection of the rights of these two categories of people under examination here could certainly be achieved if certain issues were given more attention at the Community level and a gender dimension were developed with respect to the law of co-ordination.

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6 Changed Family Conditions and the Personal Scope of the Co-ordination Regulations INTRODUCTION

The primary assumption upon which social security systems have been built, as discussed in chapter two, is that family/marriage is the institution that safeguards women’s economic security and, consequently, their social security protection is traditionally based on their relationship to a male breadwinner. The fallacy of this approach is that it ignored a large number of women, mainly working class women, whose economic security was not dependent on the income of a husband but on their own income, thus making economic activity a vulnerable ground in terms of social security. Nevertheless, a special risk was conceived for those whose social security was based on family/marriage, the risk of the death of the breadwinner giving rise to entitlement to benefits such as death grants and widows’ pensions. In contrast, divorce, as an event disrupting economic security, was not envisaged as a social security risk by any system. To the extent that divorces occurred, regulation of the economic issues and the economic security of women fell into the domain of family law. The assumption that women’s economic and social security is dependent on a male breadwinner also underpinned international legislation concerning coordination of social security, including the European Community system of coordination. The first social security regulation, Reg 3/58,1 as well as Reg 1408/71, were products of their time. It was a time of distinct gender roles with a male breadwinner and a female homemaker, stable marriage and family relationships, migration flows of low-qualified workers from southern Europe to northern and western Europe, and family-centred migration. As a consequence, the inclusion of men in the scope of the Regulations was envisaged as being based mainly on the pursuit of economic activity, while the inclusion of women was envisaged as being based primarily on their family/marriage bonds with (male) workers.2 1 2

[1958] OJ B030/561. See above ch 2, at III, 1.

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272 Changed Family Conditions and the Co-ordination Regulations Economic, social and family conditions have changed radically in our times. This chapter focuses on current family conditions and on the issue of their legal regulation within the framework of the European system of co-ordination, with a view to discovering to what extent this system has adjusted to these new conditions and is capable of providing protection to women covered by it as a family member. It can be said that the issue is the reliability of family/marriage as a basis for the application of the social security system of co-ordination in current social conditions. The concrete question posed in this chapter is whether the personal scope of Reg 1408/71 (and Reg 883/04) covers people related to a worker through a relationship other than formal marriage, ie cohabitation and registered partnership. In addition, the issue of whether the personal scope of Reg 1408/71 covers people no longer related to a worker because their marriage has been terminated through legal separation or divorce, ie former spouses, is also examined. This chapter starts with an analysis of the concept ‘members of the family’ to see whether it covers cohabitants and registered partners. The focus then turns to former spouses, with the aim of examining whether they are covered by the personal scope provisions of the co-ordination regulations. Finally, a few words are said about the application of Title II, which contains the choice of law rules, to family members.

I. THE PERSONS COVERED BY THE CO-ORDINATION SYSTEM ON THE BASIS OF FAMILY/MARRIAGE

Family members are the second major category of people covered by both Regulations. This makes family/marriage the second major criterion under which a person can be included within the personal scope of a Regulation. Marriage is traditionally the basis upon which the social security rights of women are grounded. Despite changes in traditional roles and increasing rates of female employment, the criterion ought to be relevant for a considerable number of women. About one third of women between the ages of 25 and 59 living in the European Union describe themselves as ‘housewives’.3 Against the background of modern social changes and the emergence of new forms of cohabitation beyond the borders of formal marriage, as mentioned above, it is appropriate to ask whether people who are in a relationship other than marriage with a worker, most notably cohabitants and registered partners, are also regarded as family members within the framework of Regs 1408/71 and 883/04. In addition, increasing divorce rates challenge marriage as the basis for social security rights as the dissolution of marriage often entails an interruption of social security protection based on marriage. The national systems have responded in different degrees to this challenge. The question thus arises as to whether the co-ordination 3 Eurostat, Statistics in Focus. Population and Social Conditions, 1997/5. The situation varies depending on the number of the children in the household, on the level of education of the women and on the prevailing family model in the society concerned.

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The Persons Covered by the Co-ordination System 273 system has also responded to the challenge. A second question discussed in the chapter is whether the co-ordination regulations continue to apply to the spouse of the migrant worker after termination of the marriage at law. These issues are examined first with regard to Reg 1408/71 and then with regard to Reg 883/04.

1. The Provisions of Reg 1408/71 Article 2(1) of Reg 1408/71 states that the Regulation is to apply to family members of an employed or self-employed person. Spouses and minor children are commonly perceived as family members. The analysis in this section does not intend to examine the content of the concept in relation to the children or parents and other relatives of the worker. Instead, it looks at the meaning and scope of the term in relation to people related to the worker through relationships alternative to marriage, namely cohabitation and registered partnerships. 1.1 The Concept of Family Member within the Framework of Reg 1408/71 The term ‘member of the family’ contained in Art 2(1) of Reg 1408/71 is defined in Art 1(f)(i) of Reg 1408/71 and analysed in the following sub-section. Members of the family do not need to satisfy the conditions of movement or nationality, as is discussed in sub-section 1.2. a. Definition of the Term ‘Members of the Family’ in Reg 1408/71 Pursuant to Art 1(f)(i) of Reg 1408/71, a ‘member of the family’ of an employed or self-employed person is any person defined or recognised as a member of the family or designated as a member of the household by the legislation under which benefits are provided.4 In the cases referred to in Articles 22(1)(a) and 31 of the Regulation,5 it is the legislation of the Member State in whose territory such person resides that determines the meaning and the scope of the term ‘member of the family’. Where, pursuant to the legislation, only a person living under the same roof as the employed or self-employed person can be regarded as a member of the family or as a member of the household, this condition is satisfied if the person in question is mainly 4 Under Reg 3/58, the term ‘members of the family’ was to be construed according to the law of the country of their permanent residence. This settlement was found to be problematic and was abandoned by Reg 1408/71 in favour of the legislation under which the benefits are provided; see K Lipstein, The Law of the European Economic Community (London, Butterworths, 1974), at 105. 5 These provisions refer to cases in which the condition of a person necessitates immediate benefits during a stay abroad. With regard to Art 22(1)(a) see above, ch 5 at II, 1.1 a ii. Article 31 constitutes a specification of the same right on account of pensioners. It provides that a pensioner entitled to a pension or pensions under the legislation of one Member State or to pensions under the legislation of two or more Member States who is entitled to benefits under the legislation of one of those states is to receive benefits in kind provided by the institution of the place of stay and cash benefits provided, where appropriate, by the competent institution. However, upon agreement between the competent institution and the institution of the place of stay, these benefits may be provided by the latter institution on behalf of the former, in accordance with the provisions of the legislation of the competent state.

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274 Changed Family Conditions and the Co-ordination Regulations dependent on that person.6 Article 1(f)(i) of Reg 1408/71 further provides that where the legislation of a Member State does not enable members of the family to be distinguished from the other people to whom it applies, the term ‘member of the family’ is to have the meaning given to it in Annex I. Pursuant to Art 1(f)(ii), where the benefits concerned are benefits for disabled persons granted under the legislation of a Member State to all nationals of that state who fulfil the prescribed conditions, the term ‘member of the family’ means at least the spouse of an employed or self-employed person and the children of such person who are either minors or dependent upon such person. The term ‘member of the family’ is thus utterly dependent on national definitions. Unlike the term ‘employed’, no Community meaning has yet been developed. By ‘national legislation’is meant national social security legislation. This can be seen from Art 1(f)(i) itself, and from Art 1(j) of Reg 1408/71.7 An indication, however, of Community law involvement in the definitions of national laws exists in the second part of the first sentence of Art 1(f)(i). According to it, a person is to be considered a member of the family of a worker when this person is ‘mainly dependent’ on the worker, no matter whether s/he fulfils the requirements of national legislation in terms of living under the same roof as the worker.8 What exactly is meant by the phrase ‘mainly dependent’ is not explained further.9 In any case, however, a more complete answer to the question of who is to be regarded as a ‘member of the family’ in the context of Reg 1408/71 requires a comparative examination of this concept in the national social security legislation of the various states. Such an examination will disclose how the concept of family is defined in the different Member States and whether there is any common denominator between the national definitions. In addition, it should be asked whether the Court has provided any interpretation or any definition of the term ‘member of the family’ within the framework of Art 1(f)(i) of Reg 1408/71. Comparative research into the legislation of the Member States is not undertaken within the context of this chapter. To the extent possible, attention is paid to the results of already existing research, as well as to the information available through the MISSOC database. The focus is on the question whether the term ‘member of the family’ in the social security laws of the Member States covers only formal spouses, or whether it also covers unmarried cohabitants and partners in a registered partnership. Few social security cases concerning interpretation of the term ‘member of the family’ were brought before the Court of Justice within the framework of Reg 1408/71. None concerned spouses or other people having a personal relationship 6

See Case C-212/00 Stallone [2001] ECR I-7625. See above, ch 4, n 13. See also Case C-212/00 Stallone [2001] ECR I-7625. 9 The Court has ruled, for example, that the handicapped child of a migrant worker who by reason of his handicap is prevented from acquiring the status of worker, continues to be regarded as a member of the family of the worker even after he is no longer a minor (Case 7/75 Mr and Mrs F [1975] ECR 679). 7 8

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The Persons Covered by the Co-ordination System 275 with the worker.10 There is, however, case law in other related areas of Community law. A short review of the concepts ‘family’ and ‘family member’ in the national systems of the Member States is presented in the following pages. Attention is then given to the case law of the Court concerning the interpretation of the same terms in relative areas of Community law. i. The Concept of the Family in the Member States Before examining the concepts of ‘family’ and ‘members of the family’ in the legal systems of the Member States, a few words must be said about the social developments in this area in the Member States.

Social Developments In recent decades, traditional notions of ‘the family’ have changed dramatically. Formal marriage as the only socially and legally acceptable institution for cohabitation has been questioned.At the same time, increasing divorce rates have challenged the stability and durability of marriages. In addition, falling birth rates, increasing rates of births outside of wedlock and increasing numbers of single-parent families have become dominant demographic trends. Cohabitation has increased, preceding and in some cases even replacing marriage. However, this pattern is more common in the Nordic countries,11 while it is low in Ireland and in the southern Member States. As becomes obvious, the Member States have not developed in the same way. Despite some common phenomena, the different Member States display wide diversities. Most births outside marriage, for instance, occur in the northern countries of the Community. In Sweden and Denmark the rate is nearly 50 per cent, in France and the United Kingdom 30 per cent, compared with 6 per cent in Italy and 2 per cent in Greece.12 The divorce rate is highest in Denmark, Sweden and the United Kingdom, while in Greece, Spain and Italy the rate is low.13 Converging rates among the Member States are found, in principle, only with regard to a decline in birth rates, where the countries of the south have occasionally overtaken the countries of the north. In contrast, there is considerable diversity as regards other parameters, although the phenomena are basically common in all Member States. A new institution has been recognised by law, mostly in the northern countries, ie Sweden, Denmark, Iceland and Norway. Registered partnership applies to homosexual relationships, and registration gives homosexual couples the same status in law as heterosexual married couples. Spain like Sweden, has gone further and recognises the right of homosexual couples to marry. 10

The cases concerned other dependant family members, most notably children of the worker. In Sweden, one third of all couples living together are not married. More than half of those married in 2003 had been cohabitants for three years; see SCB, Undersökningen om levnadsförhållanden (ULF, 2003). 12 E Drew et al (eds), Families, Labour Markets and Gender Roles. A Report on a European Research Workshop (Luxembourg, European Foundation for the Improvement of Living and Working Conditions, 1995), at 12. See also SCB, Barn och deras familjer (2002). 13 E Drew et al, above n 12, at 12. 11

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276 Changed Family Conditions and the Co-ordination Regulations Apart from ‘the breakdown of what is generally considered as the “complete” family’14 as indicated in these developments, even the functions of the family have changed. Where the nuclear family continues to exist, it does not always function in traditional ways, nor does it perpetuate traditional roles for its members. Modern research distinguishes between various types of the nuclear family, for instance the strong and weak family, etc.15 The picture of the Community emerging from this demographic data is one of strong national divergence with a clear north/south division,16 although converging trends have been stronger in recent years. Common perceptions and notions of the family are, for the time being, difficult to find between Member States.17 Legal Developments An interesting question concerns the extent to which social changes have affected or are reflected in legal developments in the legal systems of each Member State. To begin with, in a number of Member States, family is recognised and protected as a fundamental social unit at a constitutional level. In France, Germany, Greece, Ireland, Italy, Luxembourg, Portugal, Finland and Spain, their constitutions recognise the family as a fundamental social institution, and undertake to afford it protection.18 The ways in which the family is conceptualised in the constitutions differ, however, from one country to another.19 National constitutions often set the parameters for legislation concerning the rights and duties of family members. In some cases, the legitimate family is defined by the institution of marriage, in others the constitution is less prescriptive.20 Furthermore, particularly in the southern states, the constitution not only identifies the family as an important social institution, it also sets out the duties of the state towards families. The Portuguese constitution establishes concrete measures which the state pledges to implement in order to protect the family and respond to its needs. State action covers the promotion of the social and economic independence of the family, provision for mothers and young children and for their education, family planning and tax relief. The Greek constitution makes explicit reference to the duty of the state to provide for the special needs of large families, young people, war widows, orphans and other categories of the population who are 14

L Hantrais, Social Policy in the European Union (London, Macmillan, 1995), at 88. As to the different functions of family and how they have been preserved, adjusted or changed in recent decades, see A Agell, Äktenskap, Samboende, Partnerskap (Uppsala, Justus Förlag, 1998), at 20–22. 16 E Drew et al, above n 12, at 12. 17 For a sociological analysis of the different forms of family in Europe, including countries outside the Community, see K Boh, ‘European Family Life Patterns—A Reappraisal’; R Rapoport, ‘Ideologies about Family Forms: Towards Diversity’; and E Dahlstöm,‘Theories and Ideologies of Family Functions, Gender Relations and Human Reproduction’, all in K Boh et al (eds), Changing Patterns of European Family Life (London, Routledge, 1989). 18 L Hantrais, above n 14, at 88 et seq. 19 L Hantrais and MT Letablier, Families and Family Policies in Europe (London, Longman, 1996), at 26–27. 20 Ibid, at 28. 15

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The Persons Covered by the Co-ordination System 277 at risk. The Italian constitution makes reference to the commitment of the state to promote the family and to assist it in carrying out its tasks, especially in the cases of large families.21 On the other hand, the northern states emphasise equality issues and the interests of children rather than the legitimate family unit. The interests of individuals rather than institutionalised family units have been implicit in the liberalisation of legal definitions of the family, giving formal recognition to a plurality of family forms and a diversity of practices.22 It follows that it is generally the northern Member States that legally recognise consensual union or non-marital cohabitation. The rights of unmarried couples were first recognised formally in Denmark and Sweden in the 1970s.23 Very few other Member States recognise the same family form. France followed soon after and, by the end of the 1980s, unmarried cohabiting couples in these countries, as well as in Italy, could officially register their cohabitation. Consensual union in also recognised in Portugal.24 On the other hand, cohabiting couples are not entitled to protection from the state in Germany, while in Luxembourg only marital union is recognised. In Greece, family law recognises only marital relationships. Consensual union is not recognised in the Irish constitution and does not give rise to any legal rights in Ireland.25 Cohabitation produces legal rights that can vary in different areas of law. Generally, however, the level of protection of unmarried couples is lower than that of married couples. In Sweden, for example, cohabitation does not produce the same legal rights as marriage when it comes to inheritance law or to the obligation of maintenance between partners, despite Swedish law’s principle of neutrality as regards different forms of cohabitation. In contrast, there has been a tendency for marriage and cohabitation to be treated equally in the areas of social and tax law. A necessary precondition, however, for treating cohabitation equally with marriage is that the cohabitants have or have had a child together, or that they were previously married to one another.26 English law does not give cohabitants the same rights and 21 Ibid, at 46–51. However, references to ‘the family’ in national constitutions have not necessarily been accompanied by ministerial appointments with responsibility for family affairs. Only France, Germany and Luxembourg have appointed ministers in this area. Directorates, Councils or Commissions have responsibility for family issues in some Member States, while others have given a very low profile to family affairs. Local authorities may also bear a significant part of the responsibility. 22 Ibid, at 42–43. For a comparison of the policies of different Member States, see FX Kaufmann, ‘European Welfare States in their Relation to the Family’ in J Commaille and F de Singly (eds), The European Family. The Family Question in the European Community (Dordrecht, Kluwer Academic Publishers, 1997). 23 Finland is the Nordic Community Member State that does not have a law on cohabitation. Iceland is another Nordic state that does not have such a law. See A Agell, Familjestöd, familjebegrepp och underhållsskyldighet mot barn i de nordiska länderna, rapporter från det tionde nordiska familjerättsseminariet, i Uppsala den 6–7 mars 1995 (Uppsala, Justus Förlag, 1996), at 75 and 79. 24 L Hantrais and MT Letablier, above n 19, at 31. 25 Ibid, at 32. See also W Dumon, European Observatory on Family Policies. National Family Policies in EC-Countries in 1990, in European Commission (ed), V/2293/91-EN. 26 For an account of the cohabitation law in Sweden, see A Agell, above n 15, at 221–62; see also L Bejstam, ‘Sociala förmåner till barnfamiljer—Familjebegreppet’ in A Agell, above n 23, at

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278 Changed Family Conditions and the Co-ordination Regulations responsibilities towards one another as spouses, and property disputes in cases of separation have to be settled through different channels from those used for married couples.As a result, cohabitants may be in a more vulnerable situation than married couples when the relationship breaks down.27 Neither in Portugal do cohabiting couples have the same legal obligations towards one another as married couples.28 De facto unmarried couples who register their union in Italy can make use of services such as family counselling,29 but they are do not generally have access to a wide range of legal rights. Furthermore, Denmark, Sweden, the Netherlands, France and the UK are the countries of the Community that recognise homosexuals partnerships, while Spain and Sweden, as mentioned above, recognise marriage for homosexual couples. Denmark was the first Member State to pass legislation concerning homosexual registered partnerships in 1989; Sweden followed in 1995, the Netherlands in 1998, France in October 1999 while the UK passed relevant legislation in 2004. The legal status of registered partnership is stronger than cohabitation, at least in Sweden. Exceptions recognised at the beginning, most notably with regard to the adoption and raising a child, were removed,30 and partnership is nowadays assimilated with marriage whereas cohabitation is not.31 Obviously, Member States display considerable differences with regard to the level of protection of the traditional family, as well as with regard to the very notion and legal concept of family itself. Cohabitation without marriage is a form of family recognised in some Member States, but it usually enjoys a lower level of protection. The legal effects of registered partnerships, on the other hand, are in many respects similar to those of marriage. Nevertheless, the definition of family can vary between different legal disciplines within the framework of one and the same national legal order.32 145–50. Cohabitants do not have a mutual obligation of maintenance in Denmark either (I LundAndersen, ‘Familiebegrebet—juridisk, statistik og psykologisk’ in A Agell, above n 23, at 57), likewise in Norway (J Giertsen, ‘Familiebegrepet. Om Beskatningen eller retten til ulike sosiale ytelser beror på om barnet bor i kjernefamilie, eneforsorgerfamilie eller er saerkullsbarn’ in A Agell, above n 23, at 109). For a comparative discussion of the three Scandinavian states, see E Ryrstedt, ‘Delning mellan sambor I Sverige-gällande rätt och föreslagna förändringar i ett komparativt perspektiv’ in A NumhauserHenning (ed), Normativa Perspektiv. Festskrift till Anna Christensen (Lund, Juristförlaget, 2000). 27 L Hantrais and MT Letablier, above n 19, at 32. 28 Ibid. 29 Ibid. 30 By virtue of a Parliamentary decision in 2002, there is a possibility for registered partners to adopt children. 31 As to the Swedish law on registered partnership see A Agell, above n 15, at 263–77. A somewhat older account of the legal situation of homosexuals in different Member States can be found in K Waaldijk, ‘The Legal Situation in the Member States’ in K Waaldijk and A Clapham (eds), Homosexuality: A European Community Issue (Dordrecht, Martinus Nijhoff Publishers, 1993). For a survey of family laws in the Member States, see C Hamilton and K Stadley, Family Law in Europe (London, Butterworths, 1995). 32 See eg M Helin, ‘Om familjebegreppet i de bestämmelser som gäller privat- och offentligrättsligt underhåll av barn’ in A Agell, above n 23, at 9–15, with regard to Finnish law; I Lund-Andersen, above n 26, at 57–69, with regard to Danish law. As regards interdisciplinary variations, Hantrais notes that the concept of the family itself as defined for statistical purposes in studies of changing family structures differs from the institutional definitions used to asses the legal status of family members and entitlement

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The Persons Covered by the Co-ordination System 279 The question has been posed whether the national diversities are likely to persist or whether the systems, despite them, are in a process of converging with the result that a common European concept of family is likely to evolve. The question is deemed to be of particular importance within the context of discussions about the prospect of developing a common European policy based on a common concept of family. In the opinion of some authors, the diversities are likely to persist despite converging demographic trends in some areas, in particular birth rate decline and divorce increase.33 Others hold that the concept of the European family does exist, although it should not be assumed from this that the concept is a uniform one.34 Others have emphasised the different pace of change, despite the similarity in the general direction of the trends.35 As for the possibility of a common European policy in this field, some writers consider that the diversities signify essential difficulties for the task of identifying a common European notion or model of family, upon which a common European policy could possibly be grounded.36 Others are of the opinion that while the European family exists, European family policy does not.37 Others hold the view that a summation of Community resolutions, statements, directives and articles already indicates the existence of a certain ‘fluid’ family policy.38 Yet others have argued that European Community family law is concerned not with domestic family laws but with measures of an international private law character concerning family issues already adopted by the Community legislature,39 as well as with the to social protection (L Hantrais, above n 14, at 82). See also J Roll, What is a Family? Benefit Models and Social Realities (London, Family Policy Studies Centre, 1991); J Affichard et al, The Social Situation in Member States of the European Union. The Relevance in Quantitative Indicators in Social Policy Analysis (Luxembourg, European Foundation for the Improvement of Living and Working Conditions, 1998). 33 See eg F Bégeot and JA Fernandez-Cordon, ‘Demographic Convergence beyond National Differences’; and A Burguière, ‘Historical Foundations of Family Structures’, both in J Commaille and F de Singly (eds), above n 22. 34 ‘[E]ven if the objectives pursued are the same, the search for ways to satisfy the interests of the family and those who make up the family cannot lead to identical legislative solutions, because they are of necessity fashioned from compromises reflecting contradictory tendencies trying to express themselves . . . what is true for any family from a European country is a fortiori true for the European family: there one finds the same hopes, and the same diversity.’ See J Rubellin-Devichi, ‘Family Law: The Continuity of National Characteristics’ in J Commaille and F de Singly, above n 22, at 58. 35 L Hantrais, above n 14, at 87. 36 ‘The picture of family structure . . . is not unequivocal, making it difficult to identify a common European family model which could be the target of a common family policy’; ibid, at 88. See also L Hantrais and MT Letablier, above n 19. As to national family policies, see W Dumon, ‘The Uncertainties of Policy with regard to the Family’ in J Commaille and F de Singly, above n 22. For a discussion of the national policies with a particular focus on the adoption of measures concerning the family-work relationship, see L Hantrais,‘Sociopolitical Regulation of the Family-Work Relationship’ in J Commaille and F de Singly, above n 22. 37 J Commaille and F de Singly, above n 22. 38 F Emmert, ‘The Family Policy of the European Community’ in K Waaldijk and A Clapham (eds), above n 31, at 393. On developments in the European family and the family policies of the Member States, see also European Commission DG V, Social Europe. The European Union and the Family, 1/94 (Luxembourg, Office for Official Publications of the European Communities, 1994). 39 M Jänterä-Jareborg,‘Mot en europeisk (internationell) familjerätt’ (2001–2) Juridisk Tidsskrift 48, at 48–75. See also H Stalford,‘Regulating Family Life in Post-Amsterdam Europe’ (2003) 1 EL Rev 39.

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280 Changed Family Conditions and the Co-ordination Regulations impact of European and international conventions on domestic family law to which all or some of the states are parties.40 Significant in this context is the case law of the Court in the areas of free movement and equal treatment, discussed after attention is given to the concept of the family in the national social security laws.

The Concept of the Family in National Social Security Laws The social security definitions of the concept of ‘family’ are those of relevance for the application of Reg 1408/71. The social security definitions of family41 seem to differ, not only among Member States, but also among branches of social security within the framework of one and the same system.42 As to the issue of non-married partners, it is worth underlining here that social security is an area where non-marital cohabitation has achieved quite wide recognition. Although there is no detailed picture concerning all branches of social security in all countries, it is indicative that in France, a cohabitant who is financially dependent on a partner has been identified as a legitimate dependant for the purposes of social security benefit since 1978. In the Netherlands, married and nonmarried couples are treated in the same way. Even in Germany, where cohabitation is not formally recognised, those cohabitants who are considered to be at risk are eligible for social benefits.43 The question that emerges here is whether the recognition of alternative family forms in the national laws of the Member States, and in particular the conferment of social security rights to cohabitants and registered partners, brings these people within the personal scope of Reg 1408/71. An answer referring exclusively to national laws would suggest that unmarried or registered partners, whose status as a family member is recognised by a national social security system, should be covered by the Regulation. In that respect, it is more likely that registered partners would come within the personal scope of Reg 1408/71 than cohabitants. Before answering the question, however, attention must be paid to developments in Community law. ii. The Concept of the Family in Community Law The above short comparative review of the legal systems of the Member States has shown that a common European legal concept of ‘family’ does not currently exist. The level of protection for the traditional family varies in the legal systems of the different Member States, 40

C Hamilton and K Stadley, above n 31. As to the interplay between social changes and social security, and how social security policies have responded to changing family patterns (for instance, the individualisation trend and survivor benefits in some European countries), see A Hatland,‘Changing Family Patterns: A Challenge to Social Security’ in M Kautto et al (eds), Nordic Welfare States in the European Context (London, Routledge, 2001). 42 See eg AG Björnsdóttir, ‘Familiebegrepet og sociale ydelser til bornefamilier i islandsk ret’ in A Agell, above n 23, at 79–82, with regard to Icelandic law; J Giertsen, above n 26, at 109–12, with regard to Norwegian law; L Bejstam, above n 26, at 145–50, with regard to Swedish law. 43 L Hantrais and MT Letablier, above n 19, at 58. See also EM Clive,‘Marriage: An unnecessary legal concept’ in J Eekelaar and M Maclean (eds), Family Law (Oxford, Oxford University Press, 1994). 41

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The Persons Covered by the Co-ordination System 281 as well as for the new forms of relationship. This variety also exists among the national social security systems, in fact even among the different branches of social security within the framework of one and the same national system. The question of whether a common European legal concept of family is currently developing has already been raised. This is an important question even with regard to the social security law of co-ordination. If a common concept is emerging, should it be applicable within the field of co-ordination of social security? The Court has addressed cases raising issues of the definition of the concept of family within the free movement and equal treatment fields of Community law. As the Community has not been considered to have competence in the areas of family law and family policy, the Court has consistently avoided family policy-making per se—in fact, it has avoided all policies that are not ‘clearly stated or unambiguously implied in the Treaty’.44 Nevertheless, some important decisions concerning family issues have been delivered by the Court, as stated above, in the area of social policy. The Court did not adopt a definition of the concept of family in the cases, but it did determine whether forms of cohabitation beyond marriage should fall within the concept of family. In the Reed case,45 the Court held that the term ‘member of the family’‘cannot be interpreted as meaning that the companion, in a stable relationship, of a worker who is a national of a Member State and is employed in the territory of another Member State must in certain circumstances be treated as his spouse for the purposes of that provision’. The case referred to rights of entry and residence in the Community pursuant to Reg 1612/68. A British national applied for a residence permit in Holland, on the ground that she was living with a national of a Member State who was employed and lawfully residing in that country. Her application was rejected by the Dutch authorities. The plaintiff and her companion, also a British national, were living together and had a stable relationship of some five years’ standing. By answering the questions submitted to it, the Court ruled that Art 10(1) of Reg 1612/68, which—in contrast with Reg 1408/71—contains a Community definition of the term ‘members of the family’,46 did not include unmarried companions. The Court emphasised that ‘any interpretation of a legal term on the basis of social developments must take into account the situation in the whole Community, not merely in one Member State’ as an interpretation given by the Court to a provision has effects in all Member States.47 Thus, the Court’s answer to 44 I Ostner and J Lewis, ‘Gender and the Evolution of European Social Policies’ in S Leibfried and P Pierson (eds), European Social Policy: Between Fragmentation and Integration (Washington DC, The Brookings Institution, 1995), at 161, with references. Emmert points out that all Community organs have been careful. Wherever Community organs have become active outside the context of free movement of persons, he notes, the results were without exception non-binding resolutions and recommendations in rather general language; see F Emmert, above n 38, at 379. 45 Case 59/85 [1986] ECR 1283. 46 According to this article, those people regarded as members of a worker’s family are: (a) his spouse and their descendants who are under the age of 21 years or are dependants; (b) dependant relatives in the ascending line of the worker and a spouse. 47 Paragraph 13 of the judgment.

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282 Changed Family Conditions and the Co-ordination Regulations the question whether an unmarried companion is a member of the family of an employed person was in the negative.48 The Grant case49 referred to cohabitants of the same sex. The case raised issues of equal treatment of the two sexes in a conflict between Ms Grant and her employer, a company operating railways in the Southampton region. According to the contract of employment, the employee as well as her spouse and dependants would be granted travel concessions. Ms Grant applied for travel concessions for her female partner, with whom she declared she had had a ‘meaningful relationship’ for over two years. Her employer refused to allow the benefit sought, on the ground that for unmarried people travel concessions could be granted only for a partner of the opposite sex. Ms Grant argued that the refusal constituted discrimination based on sex, contrary to the Community law of equal treatment of the two sexes. The Court held that ‘in the present state of the law within the Community, stable relationships between two people of the same sex are not regarded as equivalent to marriages or stable relationships outside marriage between people of opposite sex’. Consequently, an employer is not required by Community law to treat the situation of a person who has a stable relationship with a partner of the same sex as equivalent to that of a person who is married to or has a stable relationship outside marriage with a partner of the opposite sex.50 The Court emphasised that measures that might affect that position were to be adopted by the legislature alone.51 While no definition of ‘family’ has yet been delivered, the Court provided a definition of the concept of ‘marriage’. In the case D and Kingdom of Sweden v Council of the European Union,52 it held that ‘according to the definition generally accepted by the Member States, the term “marriage” means a union between two persons of the opposite sex’.53 The Court continued: [I]t is equally true that since 1989 an increasing number of Member States have introduced, alongside marriage, statutory arrangements granting legal recognition to 48 The Court finally ruled, however, in the plaintiff ’s favour, but on another ground. It ruled that a refusal on the part of a Member State to grant permission to the unmarried companion of a migrant worker to reside with her/him, while such an advantage was granted to its own nationals, constitutes discrimination on grounds of nationality, contrary to Arts 7 and 48 of the Treaty. See also Case C-65/98 Eyüp [2000] ECR I-4747, where the Court ruled that the spouse of a Turkish worker would be regarded as a member of his family, even during the period she cohabited with the worker, for the purposes of application of Art 7 of Decision No 1/80 of the EEC-Turkey Association Council. 49 Case C-249/96 [1998] ECR I-621. 50 Paragraph 35 of the judgment. The judgment has been criticised for being in breach of the general principle of equality and broader notions of citizenship; see C Barnard, ‘Some are More Equal than Others: the decision of the Court of Justice in Grant v South-West Trains’ in A Dashwood and I Ward, The Cambridge Yearbook of European Legal Studies, Vol 1 (Oxford, Hart Publishing, 1999), at 147–74. 51 Paragraph 36 of the judgment. See also Case C-117/01 KB v National Health Service Pensions Agency [2004] ECR I-00541. 52 Case C-122/99 [2001] ECR I-4319. The case concerned the grant of a household allowance according to the Staff Regulations of Officials of the European Communities. The household allowance, which according to the Staff Regulations was granted to married officials, was refused to an official who had a registered partnership with another person of the same sex. As to the Staff Regulations in general, see F Snyder,‘The Community as Employer. Staff Regulations: An Aspect of European Community Law and its Relevance to Lesbians and Gay Men’ in K Waaldijk and A Clapham, above n 31. 53 Paragraph 34 of the judgment.

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The Persons Covered by the Co-ordination System 283 various forms of unions between partners of the same sex or of the opposite sex and conferring on such unions certain effects which, both between the partners and as regards third parties, are the same as or comparable to those of marriage. It is clear, however, that apart from their great diversity, such arrangements for registering relationships between couples not previously recognised in law are regarded in the Member States concerned as being distinct from marriage.54

The Court emphasised, as in the Grant case, that only the legislature could adopt measures to alter that situation:55 ‘[T]he fact that, in a limited number of Member States, a registered partnership is assimilated, although incompletely, to marriage cannot have the consequence that, by mere interpretation, persons whose legal status is distinct from that of marriage can be covered by the term “married official” as used in the Staff Regulations.’56 As to the question of infringement of the principle of equal treatment, which is entrenched in Art 141 (previously Art 119) of the Treaty, the Court ruled that such different treatment of homosexual couples does not constitute infringement of Art 141 because the granting of the allowance could not be regarded as being discriminatory on grounds of the sex of the person concerned since it was payable to all officials, both men and women. As to the question of infringement of the principle of equal treatment of officials irrespective of their sexual orientation, the Court held that such argument could not be valid as it was clearly not the sex of the partner that determined whether the household allowance would be granted, but the legal nature of the ties between the official and the partner: [T]he principle of equal treatment can apply only to persons in comparable situations, and so it is necessary to consider whether the situation of an official who has registered a partnership between persons of the same sex . . . is comparable to that of a married official. In making such an assessment the Community judicature cannot disregard the views prevailing within the Community as a whole. The existing situation in the Member States of the Community as regards recognition of partnerships between persons of the same sex or of the opposite sex reflects a great diversity of laws and the absence of any general assimilation of marriage and other forms of statutory union.57

The Court also rejected the argument referring to the protection of private and family life.58 McGlynn argues that this case law signifies the emergence of a common European Community concept of ‘family’ with a mainstream effect marking the 54

Paragraphs 35 and 36 of the judgment. Paragraph 38 of the judgment. The Court noted, however, that the Community legislature had shown no intention of adopting such measures, and it had even ruled out the idea of other forms of partnership being assimilated to marriage for the purposes of granting the benefits reserved under the Staff Regulations for married officials, ‘choosing instead to maintain the existing arrangement until the various consequences of such assimilation become clearer’. 56 Paragraph 39 of the judgment. 57 Paragraphs 46–50 of the judgment. 58 Paragraphs 58–61 of the judgment. 55

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284 Changed Family Conditions and the Co-ordination Regulations emergence of a European family law in general.59 In her opinion, this emerging concept is narrow, traditional and perpetuates the privileged status of formal heterosexual marriage. As already noted, other authors are of the view that the diversity of the national systems does not facilitate the development of a common concept of family.60 Others have emphasised that even where binding Community ‘family law’ does exist—ie in the free movement and gender equality areas—it is not independent from the law of the Member States since the definition of family depends to a large extent on the definitions of the Member States.61 However, in Dir 38/2004 concerning the right of citizens of the Union and their family members to move and reside freely within the territory of the Member States, the concept of family member has been defined as meaning not only the spouse of the Union citizen but also the partner with whom the citizen concerned has contracted a registered partnership, on the basis of the legislation of a Member State, if the legislation of the host Member State treats registered partnerships as equivalent to marriage and in accordance with the conditions laid down in the relevant legislation of the host Member State.62 Initially it was proposed that the concept ‘family member’ should include, apart from the spouse, an unmarried partner, if the legislation of the host Member State treats unmarried couples as equivalent to married couples and in accordance with the conditions laid down in any such legislation.63 As explained in the explanatory memorandum to the proposal, broadening the definition of ‘family member’ not only accommodates the case law of the Court and acknowledges the changes in the laws of the Member States, but also facilitates the free movement of Union citizens.64 It is also noted in the article-by-article commentary of the proposal that the ‘family group’ has recently undergone rapid changes and more and more people, often with children, are forming ‘de facto’ couples. Several Member States have introduced a special status, with a set of rights and obligations, for which cohabiting unmarried couples can register. Within the context of the right of residence, Community law cannot ignore this development. The European Parliament proposed an amendment to Art 2(2)(b) so that a partner to whom a Union citizen is linked by registered partnership should be included within the concept of family member, but initially the Commission did not agree with the proposed amendment.65 The final outcome was that registered partners were included in the concept of family member (provided 59 C McGlynn, ‘A Family Law for the European Union?’ in J Shaw (ed), Social Law and Policy in an Evolving European Union (Oxford, Hart Publishing, 2000). See also C McGlynn, ‘Families and the European Union Charter of Fundamental Rights: Progressive Change or Entrenching the Status Quo?’ (2001) 26 EL Rev 582. 60 Above, at a ii. 61 F Emmert, above n 38, at 379. 62 Article 2(2)(b). 63 Proposed article 2(2)(b). 64 Point 2.4 of the Memorandum. 65 ‘[T]he Commission feels that harmonisation of the conditions of residence for Union citizens in Member States of which they are not nationals must not result in the imposition on certain Member States of amendments to family law legislation, an area which does not fall within the Community’s legislative jurisdiction’; see COM (03) 199 final at point 3.1.

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The Persons Covered by the Co-ordination System 285 they are recognised as such by the applicable national legislation), while cohabiting unmarried partners were not. 1.2 The Criteria of Movement and Nationality As discussed in chapter four, an ‘employed or self-employed’ person covered by Reg 1408/71 has to fulfil the criteria of movement and nationality. Do family members have to satisfy the same criteria? The answer is that they do not. First, Reg 1408/71 applies even if the family member concerned has spent his/her entire life in the same Member State.66 The Regulation also applies in the reverse situation, that is to say when it is only the family member who has moved to another Member State, while the employed or self-employed person her/himself has always worked and resided in the same country.67 It applies even when the residence in another Member State was not that of the worker but of a survivor.68 Regulation 1408/71 does not apply, as we know, to situations where all the elements are purely internal to a single Member State.69 Consequently, a member of the family who is a national of a Member State cannot rely on Community law in order to claim one of the social security advantages granted to migrant workers and members of their families, when the worker, of whose family s/he is a member, has never exercised the right to freedom of movement within the Community.70 Second, a person does not need to be a national of a Member State in order to be covered by Reg 1408/71. That becomes apparent from the wording of Art 2(1) of Reg 1408/71, and it has also been confirmed by the Court.71

2. The Provisions of Reg 883/03 Members of the family remain the second major category to be covered by the new Regulation and consequently, the criterion of marriage remains valuable despite increased focus on the individual. The term ‘member of the family’ is defined in two different ways: first, for the purpose of the application of the entire Regulation—except with regard to benefits in kind pursuant to chapter one of Title III concerning sickness, maternity and equivalent paternity benefits—it can mean any person defined or recognised as a 66

Case C-78/91 Hughes [1992] ECR I-4839. Case C-194/96 Kulzer [1998] ECR I-0895. See also Cases 104/84 Kromhout [1985] ECR 2205; C-117/89 Kracht [1990] ECR I-2781. 68 Case 115/77 Laumann [1978] ECR 805. Regulation 1408/71 does not apply, however, to children who become orphans as a result of the death of a member of a worker’s family, who was not her or himself a worker. The person concerned is considered an orphan in the meaning of Reg 1408/71 only if her/his deceased father or mother personally had the status of worker. See Case 1/88 Baldi [1989] ECR 0667. 69 Above, ch 4 at I, 1.2. 70 Cases 147/87 Zaoui [1987] ECR 5511; C-206/91 Ettien Koua Poirrez [1992] ECR I-6685. 71 See eg Cases 7/75 Mr and Mrs F [1975] ECR 679; 40/76 Kermaschek [1976] ECR 1669; 94/84 Deak [1985] ECR 1873. 67

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286 Changed Family Conditions and the Co-ordination Regulations member of the family or designated as a member of the household by the legislation under which the benefits are provided is to be regarded as such.72 The European Parliament had proposed within the framework of the process of amending Reg 1408/71 that, for the purposes of the application of the Regulation, ‘family’ should be deemed as families in which the partners—even if they are partners of the same sex—are married by virtue of the legislation of one of the Member States. It should also include registered partners and unmarried partners in a long-term relationship, irrespective of sex, in accordance with the relevant national legislation or practice of the host country or the Member State of origin.73 This proposal, however, was not adopted in the text of the new Regulation. With regard to benefits in kind pursuant to chapter one of Title III, the term ‘member of the family’ is to be defined in principle by the legislation of the Member State in which the family members reside. This means that a family member is any person defined or recognised as a member of the family or designated as a member of the household by the legislation of the Member State in which the person resides.74 If the applicable legislation does not make a distinction between members of the family and other people to whom it is applicable, the spouse, minor children and dependant children who have reached the age of majority shall be considered members of the family.75 However, where said regulations only regard as a member of the family or a member of the household a person living under the same roof as the insured person, this condition shall be considered satisfied if the person in question is mainly dependent on that person.76

3. New Family Forms and the Persons Covered by the Co-ordination System The state of the law of co-ordination when it comes to unmarried and registered partners must be understood as follows: under the condition that these categories of people are defined or recognised as family members by the national legislation under which the benefits are provided, they are covered by the personal scope provisions of both Reg 1408/71 and Reg 883/04.77 There is no difference between the two regulations in terms of this issue. Thus, the term ‘member of the family’ has not been endowed a Community meaning that would bring unmarried or registered partners in general under the personal scope of the Regulation. There are 72 Regulation 883/04, Art 1(i)(1)(i). The original proposal was that any person with derived rights and defined or recognised as a member of the family or designated as a member of the household by the legislation under which the benefits are provided should be recognised as a family member. The expression ‘with derived rights’ was however omitted in the final text. 73 See European Parliament, Report on the Proposal for a European Parliament and Council Regulation on Co-ordination of Social Security Systems (COM (1998) 779 –C4-0137/1999 – 1998/0360 (COD)) of 17 June 2003. 74 Regulation 883/04, Art 1(i)(1)(ii). 75 Ibid, Art 1(i)(2). 76 Ibid, Art 1(i)(3). 77 See also F Pennings, Introduction to European Social Security Law (The Hague, Kluwer, 2001), at 46.

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Termination of Marriage and the Personal Scope Provisions 287 no cases concerning the interpretation of the concept of family member within the framework of Reg 1408/71. It is rather unlikely that the Court would interpret the term in a broad way to include such categories of people. It is quite clear that the Court has been careful in interpreting the concepts of family and marriage in other relative areas of the Community, considering the issues as belonging to the competence of the national legislatures. On the other hand, it is unlikely whether the narrow interpretation of the term ‘family’ in relative areas of Community law has had any impact on the meaning of the same term within the context of Reg 1408/71. The Court, as stated above, has emphasised the competence of the national legislatures in such issues. The case law thus complies in this respect with the provisions of Art 1(f)(i) of Reg 1408/71, as well as with the pertinent provisions of Reg 883/04, which also leave the definition of the concept of the family to the national competence. The conclusion must be that the co-ordination regulations cover unmarried and registered partners only to the extent that they are defined or recognised as family members according to the national scheme under which the benefits are provided.

II. TERMINATION OF MARRIAGE AND THE PERSONAL SCOPE PROVISIONS OF THE CO-ORDINATION REGULATIONS

Increasing divorce rates challenge marriage as the basis for social security rights, as the dissolution of marriage often entails an interruption of social security protection based on marriage. The national systems have responded to this challenge in various ways. The question thus arises as to whether the co-ordination system has also responded to the challenge. The question discussed in this section is whether the co-ordination regulations continue to apply to the former spouse of the migrant worker after termination of their marriage at law. Neither Art 2(1) of Reg 1408/71 nor Art 2 of Reg 883/04 refers to divorced or separated spouses. Nor do Art 1(f)(i) of Reg 1408/71 or 1(i) of Reg 883/04 refer to divorced or separated spouses, and there is no provision in any of these regulations referring directly or indirectly to them. Consequently, it could be concluded that the co-ordination regulations do not apply to former spouses. The issue, however, needs further investigation. Since the regulations refer to the national legislations for the definition of the concept of family member, it may be asked whether former spouses are potentially considered as members of the family within the framework of any national social security scheme for the purpose of acquiring or retaining entitlement to benefits. We can also ask whether they are granted any benefits in their capacity as former spouse even if they are not recognised as family members. In addition, we may ask whether former spouses are recognised as family members within the framework of Community law and whether they are granted any rights in this capacity or in their capacity as former spouse, as well as whether such developments have any impact on the Community law of co-ordination.

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288 Changed Family Conditions and the Co-ordination Regulations In the following pages, the focus will first be on the arrangements of the national legal systems and social security legislations with regard to separated or divorced spouses. Subsequently, attention will be paid to developments in Community law.

1. Termination of Marriage and National Laws Social security, the family and the labour market are the three important social institutions for income security. The long-term tendency is that the institution of family has been retreating from this task. Fewer and fewer people obtain their primary cash income from family transfers, although the rate of this trend may differ from country to country.78 The decline in the importance of family as a source of income is also evident in the legal arrangements in cases of termination of marriage through legal separation or divorce, seen mainly in the decline of the institution of alimony. Termination of a marriage is a matter for family law. Although the termination of a marriage is connected with the dissolution of the family unit, not all bonds between former spouses necessarily cease to exist. Economic bonds, for instance, may continue to exist. Alimony has been the traditional family law method of protecting the economically vulnerable partner after termination of the marriage.79 In the social security field, no rights were usually accorded to the former spouse. As a result of social change in recent decades, though, alimony as a form of protection has generally been on the decline. Where the family law protection of the former spouse weakens, other forms of protection become necessary. Available forms are the labour market participation of the spouse in question, or—when this is not possible—social security protection. There is an interplay between family law protection and social security law protection in the sense that when the former is weakening there is a need to strengthen the latter. Some Member States have to some extent responded to the need for social security protection of former spouses, others have not. Generally, however, the social security protection of former spouses—even when it is available—is considered insufficient and unsatisfactory. It appears in general that family law protection has been weakened without being followed by an analogous strengthening of social security protection. In the following sub-section, family law and the social security law arrangements of the Member States are discussed in more detail.

78

A Hatland and A Skevik,‘Changes in the Family’ in J Van Langendonck (ed), The New Social Risks, EISS Yearbook 1996 (The Hague, Kluwer Law International, 1997) 79 For a short account as to the available research concerning national differences in family law and jurisprudence, and financial settlements in divorce, see L Hancock, ‘Citizenship on the Margins: The Case of Divorce in Western Europe’ in L Holmes and P Murray (eds), Citizenship and Identity in Europe (Aldershot, Ashgate, 1999), at 107–8. As pointed out above, studies of comparative family law and jurisprudence across the Member States are ‘thin on the ground’ since these matters have only recently become the focus of some minor Community concern.

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Termination of Marriage and the Personal Scope Provisions 289 1.1 Termination of Marriage and Family Law Arrangements Existing comparative research provides certain useful information about how marriage is legally terminated in the different Member States, and the arrangements that exist concerning the economic consequences of the termination. It seems that termination of marriage does not necessarily mean a definite cut-off of all legal obligations/rights between the former spouses. In many cases, a legal obligation/ right of maintenance continues to exist. There follows a short overview of the legal situation in the different Member States. A marriage is definitively terminated by legal separation or divorce.80 With regard to the legal effects of separation, it appears that in Belgium, for example, judicial separation terminates the obligation of the spouses to cohabit and results in the separation of common property, but it does not terminate the obligation of mutual support.81 In Italy, spouses can apply for a judicial separation or they can separate by mutual consent. Separation is a common practice as it is often a precursor to divorce. Both judicial and by-agreement separation relieves the parties of the legal duty to cohabit, but a spouse has a duty to pay maintenance in the form of periodic payments to the spouse with no income.82 In Spain, separation by mutual agreement after one year of marriage must be validated by a judge. Judicial separation occurs through a petition to a court based on certain grounds. Judicial separations are common in Spain as they are often a precursor to divorce. After presentation of the petition, the spouses can live separately and the judge can make orders in respect of all matters connected to separation, such as children, disposition of the matrimonial home, administration and disposal of common property, etc. Spouses often make private agreements as to the legal effects of separation, which are considered valid. The parties can also choose to separate unilaterally or by mutual consent without complying with any legal requirements. The legal effects of a factual separation are similar to those of a judicial separation.83 In Denmark, the legal effects of separation and divorce are the same and most divorces are preceded by a legal separation.merely suspends a marriage, but the legal effects of separation and divorce are the same. Most divorces are preceded by a legal separation. Thus, it appears that in many cases separation does not terminate the legal obligation of the spouses for maintenance. Divorce, on the other hand, terminates a marriage for good and the parties have the right to remarry. With regard to the obligation to maintenance, the legal effects of divorce reveal both similarities and differences among the Member States. In Belgium, legal obligations to spousal maintenance terminate after divorce, except in respect of the ‘innocent’ spouse (ie the respondent in a fault-based divorce), who continues to have a right to maintenance. In England, Wales and Northern Ireland, 80 In Catholic countries, such as Ireland and Italy, the Catholic Church does not recognise divorce; see C Hamilton and K Standley, above n 31, at 284. 81 Ibid, at 13. 82 Ibid, at 283. 83 Ibid, at 455–6.

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290 Changed Family Conditions and the Co-ordination Regulations orders relating to maintenance in the form of periodic payments, lump sums and property adjustment for a party to the marriage can be made. In France, the applicant continues to have a duty to support the respondent financially, provided the respondent has not remarried and is not cohabiting with another person. In Germany, a divorced spouse is expected, as a matter of principle, to be selfsupporting. However, maintenance is payable to the spouse who is unable to make a living on the ground of: taking care of, or educating, a child of the marriage; oldage; illness or handicap; or shortage of adequate job opportunities in the labour market. In Greece, spouses are encouraged to become financially independent as soon as possible after the divorce and provide for their own financial needs. A right of maintenance is only granted where a former spouse is destitute. In Italy, a spouse can apply to the court for payment of maintenance (periodic payments) in proportion to the payer’s financial status. In the Netherlands, orders for periodic payments can be made in respect of the former spouse. In Portugal, each party who is in need may be entitled to receive maintenance, always in form of periodic payments, from the other party. In Spain, a spouse may be entitled to maintenance in form of periodic payments where an imbalance is created as a consequence of the marriage breakdown. In Sweden, the obligation of spouses to maintain one another ceases in principle. In certain circumstances, however, a spouse may be obliged to pay maintenance. Thus, maintenance can be paid to a spouse who during a transitional period is in need of support, according to the measure of reasonableness and taking into consideration the payer’s ability to pay, as well as other circumstances. A spouse may also be entitled to maintenance extending beyond the transitional period if the marriage was of a long duration, and the spouse has difficulty supporting him or herself, or there are very strong reasons requiring maintenance for a longer period of time.84 Cohabitation does not produce the same legal rights as marriage. One of the differences is that cohabitants do not have a legal obligation of mutual maintenance in any of the Member States where this institution is recognised.85 Consequently, no legal obligation of maintenance can exist after the termination of the relationship. In the Netherlands, however, cohabiting couples can agree through private contractual agreements that the same rules are to apply to them as to married couples in the event that they split up.86 In Spain, too, cohabitants are free to enter into their own cohabitation contracts to regulate their affairs.87 Registered partnerships are generally assimilated to marriage and produce similar legal effects in a range of fields. Thus, the same legal rights/obligations to maintenance follow partnerships concerning the period during which the partnership lasts, and the period after its legal termination.

84 This short review of family law arrangements concerning divorce is based on C Hamilton and K Standley, above n 31; see respective chapters. 85 C Hamilton and K Standley, above n 31. 86 Ibid, at 323. 87 Ibid, at 467.

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Termination of Marriage and the Personal Scope Provisions 291 It emerges, consequently, that the definite termination of marriage, through divorce or separation, does not dissolve all economic bonds between former spouses. Legal systems often contain provisions on the payment of maintenance after termination. This possibility is usually subject to conditions that most often concern the ability of one of the spouses to become economically independent during a short or longer transitional period. Since the social changes that have taken place in recent decades, the primary expectation is that spouses should be economically independent after their marriage ends. In other words, the labour market is seen, in principle, as the primary source of income in the case of a marriage dissolution. The economic importance of the family is not however completely abolished. Maintenance obligations between former spouses can thus continue to exist. The prerequisite most often seen is that income cannot be acquired through the labour market, which brings us on to the third social institution for income security: social security. We turn to social security arrangements with the aim of examining the extent to which they can provide income security in cases of marriage dissolution. To that end, a short review of the national systems of the Member States is presented in the following pages. 1.2 Termination of Marriage and Social Security Law Arrangements National systems have generally dealt with the problem of former spouses within the framework of pension schemes. Traditionally, the kind of pension primarily designed for spouses is the survivor’s or widow’s pension. This is based on the assumption that a marriage can only be terminated by death. Consequently, the risk against which the member of the family has to be protected is the risk of death of the breadwinner. This assumption, however, is considered nowadays to be obsolete. A marriage can also be terminated through separation or divorce—but divorce has never been a recognised social risk. Economically non-active former spouses may thus find themselves in a situation of income insecurity, in particular with respect to retirement. The problem that arose, therefore, was whether a spouse should remain entitled to a survivor’s or widow’s pension even after divorce. At the same time, social changes entailed changes in the social security systems. The trend has been to confer on all individuals a right to individual old age benefits. Individual old age benefits may, however be problematic for former spouses, especially in relation to the level of benefits. The question that was raised, therefore, was whether spouses should retain a right to the other party’s pension even after termination of the marriage. A short review of the systems of the Member States concerning survivor’s or widow’s pensions reveals that in Belgium, a former spouse loses the right to a survivor’s pension on the death of the other party.88 A divorced wife in Denmark also normally loses the right to a widow’s pension on her former husband’s death.89 88

S/he also loses the claim to a reserved share of the other party’s estate on death: ibid, at 19. Survivor pensions no longer exist as such under Danish social security law. The function of these pensions has been taken over but only to a very small extent by the early social pension schemes; see 89

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292 Changed Family Conditions and the Co-ordination Regulations In the United Kingdom, divorce is recognised within the framework of pension schemes, but only to a limited extent. Divorced women are not entitled to widow’s benefits, although they can substitute at least some of their former spouse’s contributions for their own in order to qualify for the basic pension. Divorce after pensionable age is treated differently. Women who are receiving the Married Woman’s pension become entitled to a full rate pension if they divorce; and if the man remarries, his new wife is entitled to the benefit—‘one of the rare situations where the benefit system will pay for more than two adults in the “family”’.90 In Austria, the beneficiary of a widow/widower’s pension is not only the actual spouse of the deceased insured person, but also the former spouse as well, provided that the insured person was paying alimony to his/her ex-spouse at the time of his/her death. In the case of remarriage the pension stops and a termination benefit is paid which is equal to 35 times the monthly widow/widower’s pension.91 In Italy, the judge may decide in cases of divorce that the ex-spouse, who formerly received alimony, should receive all or part of the widow’s pension.92 In Luxembourg, the divorced spouse of a deceased insured person, who has not remarried, is entitled to a survivor’s pension.93 Divorced and separated spouses are entitled to the survivor’s pension in Portugal if they received alimony from the deceased person.94 In Germany, a widow’s or widower’s pension is paid if the insured person had to maintain the former spouse before death, and the divorce was enacted before 1 July 1977. After this date, a credit splitting system is introduced, designed to split credits earned by the married couple during the period of marriage equally. The split and transfer of credits is immediately carried out at the moment of the divorce.95 With respect to old age pensions, it appears that in Belgium, in schemes for employees and self-employed persons, the divorced spouse is granted a personal and individual right to a pension for the years during which s/he was married to an employee or a self-employed person. The divorced spouse is then treated as if s/he has carried out an activity as an employee or self-employed person during the period of the marriage.96 In France, the divorced spouse of a deceased person who was insured for old age or was entitled to benefits for handicapped adults or to benefits in kind from the sickness insurance scheme, is entitled to the pension if she has not remarried. In certain cases, there is a pro rata division of the pension between the surviving spouse and the divorced ex-spouse or spouses who have not remarried, based on the duration of the respective marriages. If the death was due to an injury or an occupaD Pieters, Social Security Law in the Fifteen Member States of the European Union (Antwerp, Maklu, 1997), at 63. 90 J Roll, above n 32, at 33. 91 D Pieters, above n 89, at 26. 92 Ibid, at 191. 93 Ibid, at 207. 94 Ibid, at 246. For an overview of the systems of the Member States, see also the comparative tables included in the MISSOC database. 95 D Pieters, above n 89, at 119. 96 Ibid, at 44. See also Cases C-98/94 Schmidt [1995] ECR I-2559; C-144/96 Cirotti [1997] ECR I-5349.

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Termination of Marriage and the Personal Scope Provisions 293 tional disease, the divorced spouse is only entitled to a pension if s/he received alimony from the ex-partner. In case of remarriage, entitlement to a pension is suspended, but a lump sum is paid.97 In Germany a split-credit-system applies, as mentioned above, with regard to old pensions. The system aims to give wives, especially housewives, a share in their husband’s retirement pension and insurance benefits. Generally, the system is regarded as satisfactory from the viewpoint of housewives but less so from the viewpoint of married career women, who do not have much to gain from it and cannot expect to be rewarded for their extra effort invested in housekeeping, childcare, etc.98 This short overview reveals that in many Member States, the divorced spouse will generally be able to acquire a right to the survivor’s pension if s/he is economically dependent on the deceased insured person at the time of death. Economic dependence is indicated mainly through the receipt of alimony. In several Member States, the divorced spouse will also retain the right to old age benefits, which is based on the former spouse’s insurance. It can be said therefore that a concern for former spouses is apparent in many national systems and it has produced some legal rights mostly with respect to pensions, although the sufficiency of this protection may be questioned.

2. Termination of Marriage and Community Law The available case law concerning divorced or separated spouses does not come from the area of the social security law of co-ordination, but from other related areas of Community law, in particular that of free movement. The Diatta case99 concerned a Senegalese national who was married to a French national residing and working in Berlin, where she was also working herself. After living with her husband for some time, she separated from him with the intention of divorcing him. Since then, she had lived in separate accommodation. On the expiry of her residence permit, Ms Diatta requested an extension. Her request was rejected on the grounds that she was no longer a member of the family of a national of a Member State and that she did not live with her husband. The question submitted to the Court by the national court was whether the members of a migrant worker’s family, as defined in Art 10 of Reg 1612/68,100 were necessarily required to live with the worker permanently in order to qualify for a right of residence under that provision.101 The question was therefore, as some of the parties involved put it, whether the member of the family only had a derived right to residence in a Member 97

D Pieters, above n 89, at 99. C Hamilton and K Standley, above n 31, at 182. Case 267/83 [1985] ECR 0567. 100 Above n 46. 101 Article 10(2) of Reg 1612/68 provides: ‘Member States shall facilitate the admission of any member of the family not coming within the provisions of paragraph 1 if dependent on the worker referred to above or living under his roof in the country whence he comes.’ 98 99

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294 Changed Family Conditions and the Co-ordination Regulations State, in order to live with the worker.102 The Court took the view that Art 10 of Reg 1612/68 could not be interpreted restrictively, having regard to its context and the objectives which it pursues. In providing that a member of a migrant worker’s family has the right to install him or herself with the worker, Art 10 of the Regulation does not require that the member of the family in question must live permanently with the worker. The Court emphasised: ‘The marital relationship cannot be regarded as dissolved so long as it has not been terminated by the competent authority. It is not dissolved merely because the spouses live separately, even where they intend to divorce at a later date.’103 In the Baumbast and R case,104 it was shown that the right of a divorced spouse to remain resident in the host Member State is not affected where there are children involved and where the continued residence of the divorced spouse is justified by the educational needs of the children. The plaintiff, a United States citizen, had, as a result of her first marriage to a French national, two children, who had dual French and United States nationality. In 1990 she moved to the United Kingdom in her capacity as the spouse of a Community national exercising rights conferred by the EC Treaty. She was granted leave to remain in the United Kingdom until October 1995. The plaintiff and her first husband divorced in September 1992 but, as no measures were taken at that time by the Secretary of State that affected her immigration status, she continued to reside in the United Kingdom. The divorce settlement provided that the children were to reside with their mother in England and Wales for a period of at least five years after the date of the divorce or until such other time as agreed by the parties.After the divorce, the children had regular contact with their father, who still resided and worked in the United Kingdom, and who shared responsibility with their mother for their upbringing from both an emotional and financial point of view. During her residence in the United Kingdom, she also purchased a house and established a business as an interior designer, in which she invested substantial sums of money. She married a United Kingdom national in 1997. In October 1995, an application for indefinite leave to remain in the United Kingdom was made under domestic law on behalf of R and her two daughters. The children were granted indefinite leave to remain in the United Kingdom as members of the family of a migrant worker. The plaintiff ’s application was refused on the ground that the Secretary of State was not satisfied that the family situation was so exceptional as to justify the exercise of his discretion. In his view, the children were young enough to adapt to life in the United States, if they had to accompany their mother there. Mrs R challenged the decision. One of the issues raised was 102

Another question was whether Art 11 of Reg 1612/68 establishes a right of residence independent of that provided for in Art 10. Article 11 of that Regulation states: ‘Where a national of a Member State is pursuing an activity as an employed or self-employed person in the territory of another Member State, his spouse and those of the children who are under the age of 21 years or dependent on him shall have the right to take up any activity as an employed person throughout the territory of that same State, even if they are not nationals of any Member State.’ 103 Paragraph 20 of the judgment. 104 Case C-413/99 [2002] ECR I-7091.

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Termination of Marriage and the Personal Scope Provisions 295 whether that refusal would interfere with her children’s Community law rights to be educated and to reside in the United Kingdom and with the right to family life. The Court looked first at the rights of the children. It held that the children had the right to reside in a host Member State in order to attend general educational courses pursuant to Article 12 of Reg 1612/68. The fact that their parents were divorced was irrelevant in this respect. The Court went on to state that, in light of the children’s Community right, the parent who is the primary carer of those children, irrespective of her/his nationality, is entitled to reside with them in order to facilitate the exercise of that right, notwithstanding the fact that the parents have in the meantime divorced. If the parent were refused the right to remain in the host Member State while the children were receiving their education, that might deprive those children of a right which is granted to them by the Community legislature.105 Moreover, continued the Court, Reg 1612/68 must be interpreted in light of the requirement of respect for family life, which is entrenched in Art 8 of the European Convention. That requirement, the Court continued, is one of the fundamental rights and as such, according to settled case law, is recognised by Community law.106 In Dir 38/2004, amending Reg 1612/68 and several other Directives concerning Union citizens’ right to free movement, it is stated that family members should be legally safeguarded not only in the event of the death of the Union citizen, but also in the event of divorce, annulment of marriage or termination of a registered partnership. ‘With due regard for family life and human dignity,’ and in order to guard against abuse in certain conditions, measures have to be taken according to the Directive to give family members a right to residence in the host Member State on a personal basis.107 According to Art 13(1) of the Directive, divorce, annulment of marriage or termination of registered partnership shall not affect the right of residence of members of the family who are nationals of a Member State.108 Members of the family of EU citizens, who are not themselves nationals of a Member State, are to retain the right to residence under certain conditions, which are determined in Art 13(2).109 As explained in the article-by-article commentary on the pertinent proposal,110 the purpose of Art 13(2) is to provide certain legal safeguards to people whose right of residence is dependent on a family relationship by marriage, and who could 105

Paragraph 71 of the judgment. Paragraph 72 of the judgment. Preamble, p 15 Dir 38/2004 ([2004] L158/77). 108 Before acquiring the right of permanent residence, the persons concerned must fulfil certain conditions provided for in Art 7(1). 109 Three disjunctive conditions are named in Art 13(2), namely: (a) prior to the initiation of the divorce or annulment proceedings, the marriage has lasted at least three years, including one year in the host Member State; (b) by agreement between the spouses or partners or by court order, the spouse or partner, not being an EU national, has custody of the EU citizen’s children; (c) this is warranted by particularly difficult circumstances such as having been a victim of domestic violence while the marriage or registered partnership was subsisting; and finally (d) by agreement between the spouses or partners or by court order, the spouse or partner who is not a national of a Member State has the right of access to a minor child, provided that the court has ruled that such access must be in the host Member State, and for as long as is required. 110 COM (01) 257 final. 106 107

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296 Changed Family Conditions and the Co-ordination Regulations therefore be vulnerable to blackmail using threats of divorce. It also specifies that, for reasons of legal certainty, in order for a marriage to count as dissolved a decree absolute must have been granted; in the event of de facto separation, the spouse’s right of residence is not affected at all.111 The rationale of the first condition is to avoid people using marriages of convenience to get around the residence entitlement rules. The third condition, the wording of which is vague, is meant to cover, in particular, situations of domestic violence. It is also stated in the Explanatory Memorandum that the possibility of removing the right of residence from a divorced spouse, in particular a third-country national, is an acute problem; hence the need to introduce measures providing equitable solutions that respect family life and human dignity, coupled with certain conditions in order to avoid abuses of the system.112

3. Termination of Marriage and the Personal Scope Provisions of the Co-ordination Regulations The review of the various national social security laws has shown that former spouses are granted certain rights, in particular within the framework of pension schemes. It cannot be concluded, however, that these rights acquired on the criterion of marriage under a national legislation can bring a person within the scope of Reg 1408/71. This Regulation applies to people who are defined or recognised as members of the family by the legislation under which the benefits are granted. Former spouses can hardly be defined as members of the family of the worker from whom they have divorced or separated, even if they are entitled to social security rights by virtue of their marriage to that worker. Regulation 883/04 may potentially entail improvements in terms of the possibility of former spouses being covered by the co-ordination system, not in the capacity of family members but as insured people, due to the strengthening of the individual basis. Since the decisive criterion is insurance under a national scheme, former spouses covered by a national social security system on an individual basis are also to be covered by Reg 883/04 in their own capacity as insured persons. Thus, former spouses insured under a survivor’s pension scheme, for instance, come under the scope of this Regulation on the basis of such insurance. Insurance concerning survivor’s, widow’s and old age pensions is available, as stated above, to former spouses in a number of Member States. Even general residence-based schemes ought to work to the benefit of former spouses. The problem, however, is that the application of Reg 883/04 to former spouses will ultimately be dependent on national legislation. It will depend on the existence of universal social security schemes or of schemes for former spouses. Such schemes, however, whilst they exist, are not usually accorded the highest priority within the Member States. The lack of social security schemes for former spouses 111 112

Reference is made to the Diatta case. Point 2.4 of the Explanatory Memorandum.

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Members of the Family and the Choice of Law Provisions 297 may not be so problematic at the Member State level since there are alternative forms of protection, such as family law arrangements and various formal and informal networks of protection, but it can cause major problems at the Union level. Social security may well be the only institution that can protect former spouses in a migration context, and the application of the co-ordination system may thus be of utmost importance. Concern over the rights of former spouses has been demonstrated at the Community level. The relevant developments, however, relate to fields of Community law other than the field of co-ordination of social security. These cases reveal a careful approach by the Court on the issue and a gradual strengthening of the rights.113 However, whether these developments ought to have any impact in the co-ordination field is impossible to say. It is remarkable that former spouses are not yet an issue of concern for the coordination system, although they are obviously of concern both at the level of the national social security systems and at the Community level, as became apparent in the analysis above. Focusing on the matter of former spouses within the framework of the co-ordination system does not have to mean that the Community exceeds its mandate for co-ordination. There is clearly a consensus among Member States concerning the need to protect former spouses,114 as is evident from the measures taken at national level, although such measures often have low priority in the policies of the Member States and are of differing natures and characters. Thus, it ought not to be particularly problematic to clarify in the Regulation that former spouses are included in its personal scope, with the aim of co-ordinating existing schemes in the Member States covering former spouses. Such a measure is obviously of a co-ordinating nature. Furthermore, increased knowledge and more comparative research in terms of the national solutions concerning former spouses is needed in order to examine what further particular measures are possible within the co-ordination system.

III. MEMBERS OF THE FAMILY AND THE CHOICE OF LAW PROVISIONS OF THE CO-ORDINATION REGULATIONS

Article 13(1) of Reg 1408/71 states that persons to whom the Regulation applies are to be subject to the legislation of only a single Member State. In other words, the principle of single applicable legislation applies to all people covered by the Regulation, without exception. This ought to mean that even members of the family are covered by the principle. There is no mention at all of members of the family in the articles determining the applicable legislation. Obviously, they were designed with the economically active person in mind. However, they are still of importance for members of the 113

See Cases 267/83 Diatta [1985] ECR 567; C-413/99 Baumbast and R [2002] ECR I-7091. In contrast, the Member States obviously disagree as to the necessity of taking measures concerning other groups of persons, for example cohabiting or homosexual partners. 114

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298 Changed Family Conditions and the Co-ordination Regulations family. A problem could be raised, for instance, if the member of the family is subject to the legislation of the Member State of employment of the worker as a member of his/her family, at the same time as s/he is subject to the legislation of another Member State by the fact of residence in the latter Member State. Such cases have occurred with regard to family benefits and were judged on the basis of the non-overlapping rules, as discussed in the previous chapter. The application of Title II to members of the family as an independent issue, however, has never been raised or discussed. The principle of one applicable legislation is further reiterated in Reg 883/04. Pursuant to Art 11(1), the principle applies to all persons covered by this Regulation. As it emerges from Art 11(3)(e), the applicable legislation is the legislation of the Member State of residence. This rule does not apply, however, in cases where people are entitled to benefits under the legislation of one or more other Member States in accordance with other provisions of the Regulation. In other words, family members are to be subject to the legislation of the Member State of the worker’s employment pursuant to the lex loci laboris principle, if that state grants benefits to family members, or to the legislation of the Member State of residence pursuant to the lex loci domicilii principle. Several complications can, however, occur.What happens, for instance, in cases of divorce if the family member is resident in a Member State with no residence-based system? And what if the application of the Regulation results in the deprivation of rights granted under the national legislation? Such issues are not addressed by the new Regulation and, consequently, no definite answers can be provided for the time being.

CONCLUDING REMARKS

This chapter has addressed the issue of the extent to which the personal scope provisions of the co-ordination regulations have adapted to reflect changed family conditions. Since the major expressions of these changed family conditions are increasing rates of cohabitation outside marriage, the emergence of the institution of registered partnership and increasing rates of divorce, the concrete question posed in the chapter was whether cohabitants, registered partners and former spouses are covered by the personal scope of Reg 1408/71, as defined in Art 2(1) in conjunction with Art 1(f)(i), as well as by Art 2 in conjunction with Art 1(i) of Reg 883/04. The analysis has shown that there are no differences between these two Regulations as far as this issue is concerned. Cohabitants and registered partners are covered, provided that they are defined or recognised as family members by the legislation under which the benefits are provided. The concept is thus not endowed with a Community meaning entailing the application of the Community provisions to all cohabitants and registered partners in general. The application of the coordination rules to these categories of people is ultimately an issue for the national legislature. This results, of course, in the different treatment of people in similar

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Concluding Remarks 299 situations depending on the applicable national legislation, but such effects can occur as long as the systems are not harmonised.115 As regards divorced or separated spouses, the discussion has shown that neither Reg 1408/71 nor Reg 883/04 can currently be considered to be applicable to them. The fact that they may be entitled to social security rights under a national scheme does not seem to be sufficient to bring them within the personal scope of Reg 1408/71. Regulation 883/04 may potentially improve the situation of former spouses due to a strengthening of the individual basis and the later extension of the scope of the Regulation to broader categories of the population than the economically active, but this improvement will ultimately be dependent of the provisions of national law. As a general conclusion, it can be said that for all three categories of people on whom the chapter has focused, namely cohabitants, registered partners and former spouses, the question of whether the co-ordination system applies to them, either according to Reg 1408/71 or according to Reg 883/04, is ultimately dependent on national law. If, however, the issues concerning cohabitants and registered partners should be left in the competence of the Member States as being controversial and politically sensitive, the same is not true with respect to former spouses. There is obviously a consensus between Member States as to the need to protect them, and the national legal systems contain both family law and social security law arrangements to that end. National legislations cannot however safeguard the rights of former spouses in the entire Community. This ought to be done at the level of Community legislation. Regulations 1408/71 and 883/04 must thus be regarded as revealing a considerable gap in this respect.

115

In D and Sweden v Council (C-122/99 [2001] ECR I-4319), it was argued that the different treatment of registered partners constituted discrimination on the ground of nationality and an obstacle to free movement. The argument was not discussed as it was declared inadmissible for reasons of formal procedure (paras 53–57 of the judgment).

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7 Changed Family Conditions and the Application of the Fundamental Principles of Co-ordination INTRODUCTION

This chapter, like the previous chapter, focuses on the issue of reliability of family/ marriage as basis for the application of the co-ordination regulations against the background of today’s prevailing family conditions. The concrete question posed is whether the aggregation, exportability and non-overlapping principles apply to unmarried and registered partners, as well as people whose marriage to a Community worker has been dissolved. The principles of aggregation and exportability are examined in relation to sickness/maternity, old age, unemployment and family benefits. The principle of non-overlapping is examined only in relation to family benefits. Before examining whether these principles apply to unmarried and registered partners in particular, as well as to former spouses, it is necessary to examine whether they apply in the first instance to family members. Whether the pertinent provisions of Reg 1408/71 apply to family members is thus discussed first. We then go on to examine whether the concept of family member is to be understood in the light of Art 1(f)(i) of Reg 1408/71, as discussed in the previous chapter. The question is thus whether the concept ‘family member’ includes unmarried and registered partners for the purpose of applying the principles of aggregation, exportability and non-overlapping. Attention is given to former spouses within the context of all three principles. The provisions of Reg 1408/71 examined in this chapter are generally the same as those that were examined in chapter five. The current chapter consequently focuses on Title III of Reg 1408/71. Special provisions referring explicitly to family members exist only within the framework of chapter one of Title III concerning the exportability of sickness/maternity benefits, and their content is briefly outlined. The examination of the co-ordination rules is completed with a discussion of the pertinent provisions of Reg 883/04.

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302 Changed Family Conditions/Fundamental Principles of Co-ordination

I. THE AGGREGATION PRINCIPLE

As already noted in chapter six, the content of the aggregation principle does not vary significantly with regard to the different benefits. In the following pages, the examination will focus, first, on Reg 1408/71, and then on Reg 883/04.

1. The Provisions of Reg 1408/71 The specific aggregation provisions included within the chapters of Reg 1408/71 examined here are Articles 18, 45, 67 and 72. The following will examine whether these provisions apply to a Community worker’s family members. 1.1 Application of the Aggregation Principle concerning Sickness/Maternity Benefits for Family Members Article 18(1), which lays down the principle of aggregation with respect to sickness and maternity benefits, makes no reference at all to the beneficiaries of this right. It refers generally to the aggregation of periods of insurance, employment or residence to the extent necessary. In chapter five, it was determined that the article undoubtedly applies to employed and self-employed persons. But should it also be considered applicable to family members? Any distinction between employed or self-employed persons and the second category covered by Reg 1408/71, namely members of the family, is not implied in the provision. There is thus no reason to suggest that Art 18(1) should not be applicable to members of the family. The existing case law seems to underscore this view. In the Luxembourg case,1 the Commission challenged Luxembourg’s legislation on the ground that it made payment of maternity allowances subject to residence conditions. Maternity allowance in Luxembourg was paid to every woman who was pregnant or had given birth, provided that either she had been officially resident in Luxembourg for the entire year preceding the beginning of her entitlement, or her husband had been officially resident in the country for three years preceding the entitlement benefit. The right to the allowance was thus granted to the women concerned both as a personal and as a derived right.2 The Commission argued, as discussed above, that by requiring fulfilment of residence conditions, the national legislation was in breach of Art 18(1) of Reg 1408/71. The Court found that the residence requirements were in breach of Art 18(1).3 Consequently, that article and the aggregation right entrenched in it must be considered as being applicable to members of the family. The nature of the right as personal or derived, under the national legislation, should not play any role. 1 2 3

Case C-111/91 Commission v Luxembourg [1993] ECR I-0817. For a discussion of personal and derived rights, see below at 1.5. As well as Art 7(2) of Reg 1612/68 and Art 52 of the EEC Treaty.

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The Aggregation Principle 303 1.2 Application of the Aggregation Principle concerning Old Age Benefits for Family Members Article 45 establishes the aggregation principle within the framework of chapter three of Reg 1408/71. This chapter concerns old age and death pensions, ie longterm benefits. There is no case law concerning the application of the provision to family members. 1.3 Application of the Aggregation Principle concerning Unemployment Benefits for Family Members Can members of the family rely on the application of the principle of aggregation when the benefits at issue are unemployment benefits? The Kermaschek Case 4 This case concerned a Yugoslav national married to a German national who, in order to live with her husband, left her residence and her job in the Netherlands. She claimed, as a member of the family of a worker, unemployment benefit in Germany on the basis of contributions paid during employment in the Netherlands. In other words, she claimed application of Reg 1408/71 concerning unemployment benefits, in particular application of the aggregation principle, in her capacity as a family member of a national of a Member State. The competent German institution rejected her claim on the ground that the periods of employment completed in the Netherlands could not be taken into account as a condition for the acquisition of the right to that benefit. It emerges from the facts of the case that Ms Kermaschek had established the right to unemployment benefits in the Netherlands on the basis of her employment, and paid contributions in that country. If she were a national of a Member State, Reg 1408/71 would have applied to her by virtue of her capacity as an employed person. Regulation 1408/71 was not, however, applicable on the basis of her employment because she did not fulfil the condition of nationality.5 The question therefore was whether she could benefit from the application of Reg 1408/71, in particular from the provisions of chapter six of Title III, in her capacity as a family member. Nationality, as noted above, is not a necessary pre-condition for the application of Reg 1408/71 to family members. The Court held that Art 2(1) of Reg 1408/71, which determines the personal scope of application of said Regulation, refers to two clearly distinct categories: workers, on the one hand, and members of their family and their survivors, on the other. Whereas the persons belonging to the first category can claim the rights to benefits covered by the Regulation as rights of their own, the Court held that persons belonging to the second category can only claim derived rights, that is to say rights acquired by virtue of their status as members of the family of a worker. 4 5

Case 40/76 [1976] ECR 1669. Cf the Bergemann case 236/87 [1988] ECR 5125.

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304 Changed Family Conditions/Fundamental Principles of Co-ordination [I]t follows that Articles 67 to 70 of Regulation No 1408/71 have only one main purpose, namely the co-ordination of the rights to unemployed benefits provided by virtue of the national legislation of the Member States for employed persons who are nationals of a Member State. The members of the family of such workers are entitled only to the benefits provided by such legislation for the members of the family of unemployed workers . . .6

Consequently, the plaintiff could not claim unemployment benefits on the basis of her capacity as a family member of a worker. Following that case, the Court consistently confirmed this precedent in several cases, not only with respect to unemployment benefits.7 Nevertheless, the adverse effects of this precedent for members of a worker’s family were mitigated in many cases by the possibility of invoking Art 7(2) of Reg 1612/68.8 The benefit in question was regarded as a social advantage and was claimed on the ground of the principle of equal treatment between the family members of the Community worker and the family members of a national of a Member State.9 The situation can become truly problematic for the family member concerned, only if the benefit in question cannot be classified as a social advantage and be granted on the basis of Art 7(2) of Reg 1612/68. The most typical example of such benefits is unemployment benefits. This was most recently confirmed in the Ruhr case,10 which concerned the right of the Polish spouse of a German national to unemployment benefits in Germany. The Court affirmed that the interpretation adopted in the Kermaschek case continued to hold good in relation to Art 2(1) in conjunction with Articles 67 to 71a of Reg 1408/71. The reason is that unemployment benefits can only be conferred on the ground of employment. It is interesting to note, however, that unemployment benefits granted to young job-seekers by a national scheme were found to constitute social advantages and therefore could be claimed by a member of a worker’s family on the basis of the equal treatment rule found in Art 7(2) of Reg 1612/68.11 On the contrary, as noted above, unemployment benefits connected to a contract of employment cannot be claimed by a family member on the basis of Reg 1408/71, as they are not derived from the claimant’s relationship to a worker, according to the Kermaschek precedent.12 Such benefits cannot be regarded as social advantages within the meaning of Reg 1612/68.

6

Paragraph 9 of the judgment. Cases 94/84 Deak [1985] ECR 1873; 157/84 Frascogna [1985] ECR 1744; 147/87 Zaoui [1987] ECR 5511; C-243/91 Noushin Taghavi [1992] ECR I-4401; C-310/91 Schmid [1993] ECR I-3037; C-189/00 Ruhr [2001] ECR I-8225. 8 Article 7 of Reg 1612/68 establishes the principle of equal treatment between national and migrant workers concerning social advantages. According to Art 7(2), a worker who is a national of a Member State is to enjoy in the territory of another Member State the same social and tax advantages as national workers. 9 Cases 256/86 Frascogna [1987] ECR 3431; C-310/91 Schmid [1993] ECR I-3037. 10 Case C-189/00 [2001] ECR I-8225. 11 Case 94/84 Deak [1985] ECR 1873. 12 Case C-189/00 Ruhr [2001] ECR I-8225. 7

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The Aggregation Principle 305 1.4 Application of the Aggregation Principle concerning Family Benefits for Family Members The aggregation provision with regard to family benefits is contained in Art 72 of Reg 1408/71.13 It is not apparent from the wording of the provision whether it should apply to family members and there is no relevant case law.

2. The Provisions of Reg 883/04 No explicit reference to the beneficiaries of the aggregation principle is made in the general aggregation provision of Art 6. Two statements, however, are made in the preamble to Reg 883/04 that are relevant in this respect. According to them, the coordination rules must guarantee that people moving within the Community and their dependants and their survivors retain the rights and the advantages acquired and in the course of being acquired; and these objectives must be attained in particular by aggregation of all the periods taken into account under the various national legislations for the purpose of acquiring and retaining the right to benefits and of calculating the amount of benefits, and by the provision of benefits for the various categories of persons covered by the Regulation.14 It is thus apparent that the aggregation principle should apply to family members. Turning now to the specific provisions of Title III, articles on aggregation are contained in the chapters concerning old age benefits and unemployment benefits. Neither Art 51 concerning old age benefits nor Art 61 on unemployment benefits explicitly refers to family members.

3. Changed Family Conditions and the Application of the Aggregation Principle The above discussion has shown that the aggregation principle concerning sickness/maternity benefits ought to apply to family members irrespective of whether the right to the benefits is personal or derived. In contrast, the aggregation principle does not apply to family members when the benefits at issue are unemployment benefits, since these benefits cannot be acquired as a family member. There is no case law addressing the issue of whether the aggregation provisions within the framework of the chapters concerning old age benefits and family benefits apply to family members. There are no indications that the term ‘members of the family’ for the purpose of the application of the aggregation principle should be understood in any other way than in the light of Art 1(f)(i) of Reg 1408/71 (or 1(i) of Reg 883/04). Thus, to the extent that Reg 1408/71 applies to cohabitants and registered partners according to 13 14

Above, ch 5 at I, 1.2 d. Preamble, 13th and 14th recitals.

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306 Changed Family Conditions/Fundamental Principles of Co-ordination what was said in the previous chapter, the principle of aggregation concerning at least sickness/maternity benefit ought to be applicable. In contrast, the same principle ought not to apply to former spouses. The same conclusion must be drawn with respect to Reg 883/04 with the remark that the aggregation principle in the new Regulation covers all benefits.

II. THE EXPORTABILITY PRINCIPLE

As stated in chapter five, the content of the exportability principle varies depending on the benefit concerned in Reg 1408/71, when the benefit at issue is short-term benefit. The principle is more extensive in Reg 883/04 and covers all sorts of benefits. 1. The Provisions of Reg 1408/71 Of all the chapters of Reg 1408/71 examined in this book, only chapter one concerning sickness and maternity benefits includes provisions explicitly referring to members of the family. 1.1 Application of the Exportability Principle concerning Sickness/Maternity Benefits for Family Members Chapter one of Title III of Reg 1408/71 includes, as stated above, provisions making explicit reference to family members as beneficiaries of the exportability principle. These provisions will now be discussed. Pursuant to Art 19(2) of Reg 1408/71, family members who reside in the territory of a Member State other than the competent one are entitled to benefits in kind and benefits in cash according to the same rules as the worker him/herself, in so far as they are not entitled to such benefits under the legislation of the state in whose territory they reside.15 Article 19(2) continues by stating that where members of the family reside in the territory of a Member State under whose legislation the right to receive benefits in kind is not subject to a condition of insurance or employment, benefits in kind which they receive are to be considered as being on behalf of the institution with which the employed or self-employed person is insured, unless the spouse or person looking after children pursues a professional or trade activity in the territory of said Member State. Pursuant to Art 22(3) of Reg 1408/71, family members of an employed or selfemployed person who stay outside the competent state are to be entitled to benefits in kind and in cash in the Member State of stay according to the same rules as the worker him/herself.16 If they reside in the territory of a Member State other than the one in whose territory the employed or self-employed person resides, the following 15 16

Case C-451/93 Delavant [1995] ECR I-1545. See above, ch 5 at II, 1.1 a ii.

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The Exportability Principle 307 rules apply for the award of benefits in kind when the condition of the person concerned necessitates immediate benefits during a stay abroad or when authorisation has been given for appropriate treatment in another Member State: (a) benefits in kind are to be provided on behalf of the institution of the Member State in whose territory the family members are residing by the institution of the place of stay in accordance with the provisions of the legislation which it administers as if the employed or self-employed person were insured there. The period during which benefits are provided, however, is to be that laid down under the legislation of the Member State in whose territory the family members are residing; (b) the authorisation required is to be issued by the institution of the Member State in whose territory the members of the family are residing. As clarified in para 4 of Art 22, the fact that the provisions of para 1 apply to an employed or self-employed person is not to affect the right to a benefit of members of his/her family. According to Art 20 of Reg 1408/71, members of a frontier worker’s family may receive benefits in the territory of the competent state as though they are resident in that state. In addition, according to Art 25(3), where an unemployed person satisfies the conditions of the legislation of the Member State which is responsible for the cost of unemployment benefits for entitlement to sickness and maternity benefits, the members of his family are to receive these benefits, irrespective of the Member State in whose territory they reside or are staying. Benefits in kind are to be provided by the institution of the place of residence or stay and cash benefits by the competent institution of the Member State responsible for shouldering the cost of the unemployment benefits. The content of the provisions concerning family members is similar to the content of the provisions concerning employed, self-employed and unemployed persons. The right of exportability, as defined within the framework of chapter one, is conferred on them directly by Reg 1408/71 in their capacity as a family member.17 Chapter one thus contains a number of provisions concerning specific categories of persons, including family members. The current developments aim at eliminating the fragmentation of the system that occurs due to the existence of different provisions for different categories of persons and bringing into line the rights of all persons covered by the relevant provisions of chapter one of Title III.18 1.2 Application of the Exportability Principle concerning Old Age Benefits for Family Members The relevant exportability provision applicable when the benefit at issue is an old age pension, as already stated in chapter five, is Art 10(1) of Reg 1408/71. The case law shows that this provision applies to family members. 17

Not just the family of active workers or the unemployed are entitled to export sickness and maternity benefits. Articles 26, 29 and 31 refer to the same right on account of pension claimants’ and pensioners’ family. 18 See above, ch 5 at II, 1.1 a ii.

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308 Changed Family Conditions/Fundamental Principles of Co-ordination The Piscitello case19 concerned an Italian national who received a social aid pension in Italy. According to the Italian legislation, the social aid pension was paid to nationals who were 65 years of age and residing within Italian territory and whose annual income, including that of their spouse, if they were married, was below the amount provided for by law. It was granted automatically to all Italian nationals aged 65 who were not in receipt of any other social security or social assistance benefit and who, on the basis of their taxable income, did not have sufficient means to meet their vital needs. Furthermore, if the beneficiary was in receipt of other income, the amount of the social aid pension was reduced accordingly. The plaintiff ’s pension payments were discontinued when she moved to Belgium to live with a member of her family, on the ground that, as of the date she transferred her residence, she no longer fulfilled all the conditions laid down by the national law. The questions submitted to the Court concerned the classification of the pension in question as a social security benefit and the application of the general exportability clause of Art 10(1) of Reg 1408/71. The Court held that a social aid pension, which is paid on the basis of objective criteria to elderly nationals in order to provide them with the minimum means of subsistence, must be assimilated to an old age benefit within the meaning of Art 4(1)(c) of Reg 1408/71 and be included amongst the benefits referred to in the first sub-paragraph of Art 10(1) of the same Regulation. Since the Regulation in question contains no specific provisions relating to that pension, the general exportability clause of Art 10(1) of that Regulation must be taken to apply to the benefit in question. The importance of the case for the purposes of this book is that it clearly demonstrates that Art 10(1) of Reg 1408/71 applies to family members when the benefits at issue are old age benefits, even though this question was not directly submitted to the Court. 1.3 Application of the Exportability Principle concerning Unemployment Benefits for Family Members No case law has addressed the application of the exportability provisions in the context of unemployment benefits for members of the family, and it may well be a completely hypothetical question. This would have been the case, for instance, if Ms Kermaschek had requested that Dutch unemployment benefits be exported to Germany, instead of claiming benefits in the latter state. The Court’s reasoning would probably be the same, that is to say, the benefit could be exported by a person in their capacity as a family member since the right to it was not derived. 1.4 Application of the Exportability Principle concerning Family Benefits for Family Members The relevant provisions of chapter seven of Title III concerning the right to export family benefits are, as was stated in chapter five, Arts 73 and 75 of Reg 1408/71.20 19 20

Case 139/82 [1983] ECR 01427. Above, ch 5 at II, 1.2 d.

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The Exportability Principle 309 The Hoever and Zachow cases discussed there demonstrate that Art 73 applies to family members. This will now be discussed in more detail. The Hughes Case 21 This case concerned a weekly non-contributory cash benefit—family credit—granted to families with limited means according to pertinent legislation in Northern Ireland. Ms Hughes lived with her husband and children in Ireland. She did not work. Her husband, a national of the United Kingdom, worked in Northern Ireland and had never worked outside Northern Ireland. Ms Hughes’ application for family credit was rejected on the ground that she did not satisfy the residence condition of the applicable national legislation. She argued that she nonetheless was entitled to family credit by virtue of Community law, and, more particularly, that family credit was a family benefit exported by virtue of Art 73 of Reg 1408/71. Article 73 applies in cases where the members of the worker’s family do not reside in the territory of the competent Member State. This article obviously envisages only the situation where family benefits are granted according to the national legislation to the worker him/herself in respect of members of his/her family. It does not envisage the situation where the benefits are instead granted by the national legislation to members of their family—in this case the spouse. Thus, the members of the worker’s family are not explicitly referred to as beneficiaries. The answer given by the Court was as follows: [T]he spouse of an employed person can claim a derived right to family benefits under Article 73 of Regulation No 1408/71 provided that he or she is a member of the family of a worker who fulfils the conditions laid down in Article 73 and provided also that under national legislation the family benefits concerned are provided for family members.22

The practical outcomes of the case were consequently two: First,Art 73 was declared applicable to members of the family. They could therefore benefit from the right to export family benefits according to this article. Second, it was declared that the application of Art 73 to family members is restricted to family benefits that are granted as derived benefits under the applicable national legislation. An issue thus arises as to situations where the benefits are granted as personal rights under the national legislation. This issue was raised in the subsequent Hoever and Zachow cases, as discussed earlier.23 They will be revisited here in order to highlight this particular issue. The benefit at issue in the Hoever and Zachow cases, namely the German childraising allowance, classified by the Court as a family benefit, was conferred on people raising a child as an individual right under the national legislation. The person concerned could be a worker or the spouse of a worker. Consequently, the cases were different from the Hughes case at this point. In Hughes, the spouse had a derived right to the benefit since she was entitled to it in her capacity as a family 21 22 23

Case C-78/91 [1992] ECR 4859. Paragraph 26 of the judgment. Above, ch 5 at II, 4.3 b.

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310 Changed Family Conditions/Fundamental Principles of Co-ordination member. Nevertheless, even in the Hoever and Zachow cases, the award of the benefit required residence in the national territory. The national legislation’s requirement of residence within the national territory could be waived if Reg 1408/71 applied. The question of course was on what basis Reg 1408/71 could be applied. Ms Hoever and Ms Zachow were not employed persons, so Reg 1408/71 could not apply to them in their capacity as such. Could it apply to them in their capacity as family members? More particularly, could Art 73 and the exportability principle entrenched within it apply to them by virtue of their capacity as family members? Even if it could, the case law existing at that time suggested that family members could benefit from the right of exportability only with regard to rights granted as derived rights by the national legislation. That was not the case with the benefit in question. The right to a child-raising allowance was a right in person. The Commission argued the non-exportability of the benefit in these cases. Since members of a worker’s family could only claim derived rights as acquired through their status as a member of the family of a worker, Art 73 of Reg 1408/71 could not apply in this case. Deviating from the previous case law, the Court held that Reg 1408/71, in particular Art 73, was in fact applicable in the cases at issue. The Court emphasised that the scope of its ruling in the Kermaschek case was limited to cases in which a member of the worker’s family relies on provisions of Reg 1408/71 applicable solely to workers and not to members of their families. Articles 67 to 71 concerning unemployment benefits are such provisions: [T]hat is not the case with Article 73 of the regulation, the precise purpose of which is to guarantee members of the family residing in a Member State other than the competent State the grant of the family benefits provided for by the applicable legislation. It follows that the distinction between personal rights and derived rights does not in principle apply to family benefits.24 (emphasis added)

The Court also emphasised that Art 73 is intended in particular to prevent Member States from making entitlement to and the amount of family benefits dependent on the residence of the family members of a worker in the Member State providing the benefits, so that Community workers are not deterred from exercising their right to freedom of movement. The Court reasoned that if the grant of a family benefit, such as the child-raising allowance, is subject to the condition that the spouse of the worker not resident in Germany must be employed there, the worker could be deterred from exercising his/her right to freedom of movement: ‘Consequently, it would be contrary to the purpose and spirit of Article 73 of Regulation No 1408/71 to deprive a worker’s spouse of a benefit to which he or she would have been entitled if the spouse had remained in the State providing that benefit.’ The decision as to which parent is to receive the allowance is of no importance, the Court underlined, endorsing the view of the Advocate General in this respect. Family benefits by their nature cannot be regarded as payable to an individual in isolation from his/her family circumstances. 24

Paragraphs 32 and 33 of the judgment.

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The Exportability Principle 311 The judgment confirmed previous case law according to which Art 73 applied to family members. This judgment entailed that the article is to apply even when family benefits are granted under the national legislation on the basis of an individual right belonging to the person concerned. The application of Reg 1408/71 even where the right to the benefit is an individual right has been one of the most important developments in recent years. This issue is discussed in the following subsection. 1.5 The Individualisation Trend in the Social Security Systems and the Application of Reg 1408/71 The rights conferred on family members are generally considered in social security theory as indirect and ‘derived’ rights, based on the relationship of the beneficiaries with the worker-breadwinner. The assumption embedded in Reg 1408/71 is that family members are entitled to derived rights in national systems. Thus, the aim of co-ordination is to facilitate acquiring and retaining derived rights. In the aftermath of the social changes and the development of the social citizenship model of social security, there has been an increasing trend in all national systems towards conferring rights to all citizens on an individual basis. This trend has been more far-reaching in some Member States than in others. Thus, same or similar benefits may be conferred on different bases in different Member States. Old age benefits are an illustrative example: in some systems, the right to old age benefits is an individual, personal right, in others it is a derived right.25 Against this background, the question for Reg 1408/71 has been whether it applies to family members only concerning those rights conferred to them as derived rights in the national system, or whether it also applies to personal rights. The case law originally indicated that the application of the co-ordination principles was intended to safeguard only the derived rights that members of the family enjoyed under national law.26 Against the backdrop of the increasing individualisation of rights in the national systems, however, the Community law of coordination came gradually to entail a safeguarding of benefits acquired on an individual basis. The Cabanis-Issarte case is seen as a milestone in this development. The Cabanis-Issarte Case 27 This case, issued slightly before the Hoever and Zachow cases, concerned a French national, married to another French national, who took up residence in Netherlands on account of her husband’s occupation in that country. After retirement, they returned to their country of origin. After the death of her husband, Ms Cabanis claimed a single person’s pension pursuant to the provisions of the Netherlands legislation, for the calculation of which she was asked to pay voluntary contributions. The amount of contributions was fixed at the maximum rate on the basis of a provision that did not apply to Netherlands 25 26 27

See eg Case C-165/91 Van Munster [1994] ECR I-4661. See eg Case 40/76 Kermaschek [1976] ECR 1669. Case C-308/93 [1996] ECR I-2097.

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312 Changed Family Conditions/Fundamental Principles of Co-ordination nationals. Ms Cabanis appealed the decision and requested reduced contributions at the same rate as that applying to nationals. Pursuant to national legislation, all people residing in the Netherlands were covered directly and individually, irrespective of sex and marital status, by the general old age insurance law. Entitlement to a pension, thus, was not a right acquired through status as a member of the family, or survivor, of a migrant worker, but was individualised and was held by a person in their own right. The question was whether Ms Cabanis, who had never worked, could in her capacity as a family member rely on Art 3(1) of Reg 1408/71, and demand equal treatment with Netherlands nationals concerning the payment of contributions, although the right to the old age benefit was not a derived right under the national legislation. The Court first underlined that the distinction drawn between workers and members of their families or survivors determines the persons to whom many of the provisions of Reg 1408/71 apply, certain of which apply exclusively to workers.28 As regards the application of the equal treatment provision, ie Art 3(1) of Reg 1408/71, the Court, disagreeing with the Advocate General, took the view that this article should apply to family members even with respect to rights that are not derived under the national legislation in question. The Court pointed out that Article 3(1) grants to ‘persons resident in the territory of one of the Member States’ and to whom the regulation applies, the right to equal treatment as regards application of the social security legislation of the Member States,‘without drawing any distinction between workers, members of workers’ families or their surviving spouses’. The Court added that any derogation from equal treatment based on one of the provisions of the Regulation, to which Article 3(1) refers, must be objectively justified if the fundamental rule of non-discrimination is not to be deprived of meaning.29 The question was therefore which provisions of Reg 1408/71 permitted derogation from the principle of equal treatment. The Court found that no provision of the Regulation, in particular no provisions of Title III, chapter three regarding old age and survivors’ benefits, excluded the application of Article 3 in a question concerning the conditions governing the grant of an old age pension to the surviving spouse of a worker based on voluntary contributions. The Court held that this case was different than the Kermaschek case. Regulation 1408/71 had not been applicable in the earlier case as national provisions on unemployment benefits cover employed persons and Community law simply coordinates them. The national provisions, on account of which application of the Community principle of equal treatment was claimed in the Cabanis-Issarte case, were not reserved for employed persons. The old age benefit in question, in particular, was not reserved for employed persons.30 As in its judgments in the Hoever and Zachow cases, the Court held that once a provision of Reg 1408/71 was found to be applicable to a family member, it was of 28

Paragraph 22 of the judgment. Paragraph 26 of the judgment. 30 See also M Moore, ‘Freedom of Movement and Migrant Workers’ Social Security: An Overview of the Court’s Jurisprudence 1992–1997’ (1998) 35 CML Rev 409, at 416. 29

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The Exportability Principle 313 no importance whether the right to the benefit in question was granted in person or as a derived right by the national legislation: ‘[S]uch a distinction between rights in person and derived rights tends to be blurred in the national social security systems, in view of the tendency for social security cover to be universal.’ The Court justified its view in the Cabanis-Issarte case not only by referring to the necessity of promoting free movement, but also by emphasising the need to apply Community law uniformly in all Member States. The Court reasoned that the distinction between rights acquired in person and rights derived through others, which the Court drew in the Kermaschek case, can undermine the fundamental Community law requirement that its rules should be applied uniformly, by making their applicability to individuals depend on whether the national law relating to the benefits in question treats the rights concerned as rights in person or as derived rights, in the light of specific features of the domestic social security scheme. Consequently, the provisions of Reg 1408/71 apply to family members irrespective of whether the right to a benefit is conferred on them under a national law as an individual right or as a derived right. On the contrary, family members cannot rely on Reg 1408/71 when the right to a benefit is employment-related.31

2. The Provisions of Reg 883/04 The provisions of chapter one of Title III of Reg 883/04 regarding sickness and maternity benefits concern the award of benefits in cases of residence or a stay abroad of different categories of persons, such as those insured against the risk of sickness and maternity, pension recipients or pension claimants. The same provisions make explicit reference to family members, entailing that the latter enjoy the same rights as the former. The chapters covering old age and family benefits do not contain specific exportability provisions. There is no indication that the term ‘member of the family’ should be understood in any other way than by reference to the definition included in Art 1(i).

3. Changed Family Conditions and the Application of the Exportability Principle The above discussion has shown that sickness and maternity benefits are exported by family members by virtue of the specific provisions in chapter one referring explicitly to members of the family. The exportability provisions concerning old age and family benefits apply to members of the family by virtue of the case law. 31 Pennings describes the impact of Kermaschek (40/76 [1976] ECR 1669) and the Cabanis-Issarte (C-308/93 [1996] ECR I-2097) on the co-ordination law as follows: the Kermaschek doctrine can be characterised as no, unless: members of the family cannot invoke the Regulation, unless in case of benefits meant especially for them. The Cabanis doctrine can be denoted as yes, unless: members of the family can rely on the Regulation, unless the provisions are meant especially (taking into account the wording) for employees or self-employed persons. See F Pennings, Introduction to European Social Security Law (The Hague, Kluwer, 2001), at 48.

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314 Changed Family Conditions/Fundamental Principles of Co-ordination However, how is the term ‘member of the family’ to be understood within the context of these provisions? This question has never been raised and there is no case law. If it should be understood in the light of Art 1(f)(i) of Reg 1408/71, the pertinent provisions of chapter one as well as Art 10(1) with respect to family benefits and Art 73 concerning family benefits must apply to unmarried and registered partners, provided these forms of family living are recognised in national law. In contrast, they should not apply to former spouses. This means that in the hypothetical case, people in Ms Hoever and Ms Zachow’s position, as divorcees, would not be able to continue to receive the German childraising allowance as they would not qualify for the application of Art 73 either as employed persons or as family members. The same would be true for a person in Ms Maaheimo’s position.32 Thus, while the development of Community law was beneficial to the interests of spouses, those interests are exposed to the risks that accompany termination of marriage. Where they were entitled to similar benefits in the Member State of residence solely by virtue of the national legislation, their right would be defeated by virtue of the Community non-overlapping rules, as discussed in the following section. The new Regulation does not change anything with regard to these questions.

III. THE NON-OVERLAPPING PRINCIPLE

The discussion of the non-overlapping principle here is confined to family benefits.

1. The Provisions of Reg 1408/71 The principle, as discussed in the previous chapter, is laid down in Art 12 of Reg 1408/71 and reiterated with regard to family benefits in Arts 76 of Reg 1408/71 and 10(1)(a) of Reg 574/72. The question to be discussed in this chapter is whether these provisions apply to family members, and in particular to unmarried and registered partners as well as to former spouses. 1.1 Application of the Non-Overlapping Principle concerning Family Benefits for Family Members The aim of the principle is to hinder the overlapping of family benefits. As shown in chapter five, the principle applies irrespective of the employment status of the persons concerned.33 The case law discussed in this sub-section shows that the principle also applies irrespective of the marital status of the persons concerned.

32 33

Above, ch 5 at II, 4.3 b. Above, ch 5 at III, 1.2. .

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The Non-overlapping Principle 315 1.2 Marriage Dissolution and Application of the Non-Overlapping Principle The relevant case law includes one particularly interesting case concerning the application of the non-overlapping principle after marriage dissolution. The Kromhout Case 34 The facts of this case were as follows: The plaintiff in the main proceedings, Ms Kromhout, a Netherlands national, was married to a German national. The couple lived with their two children in Germany. After their divorce, Ms Kromhout returned to the Netherlands and settled there with the two children from the marriage, while her ex-husband continued to live and work in Germany. Ms Kromhout received from the Netherlands authorities family allowances in respect of her children pursuant to the provisions of the national general law on family allowances. Family allowances are paid under that law to people who have reached the age of 15 and are resident in the Netherlands. Ms Kromhout was not and had never been employed. Her former husband, as an employed person residing in Germany, received from the German authorities family allowances in respect of the two children for the same period, pursuant to the provisions of the German federal law on child allowances, and to Art 73 of Reg 1408/71. In the divorce proceedings, he was ordered to pay maintenance and make a contribution towards the cost of providing for and bringing up the two children. It was apparent from the case documents that he paid maintenance to his former wife but he did not transfer the funds of the family allowances which he received in respect of the two children to her. The Dutch institution suspended Ms Kromhout’s family allowance payments, except for the excess over the amount of the family allowances received by her former husband in Germany. The institution relied on the first sentence of Art 10(1)(a) of Reg 574/72 in coming to this decision. Taking into consideration the fact that Ms Kromhout was entitled in her own right to family allowances under Dutch legislation and that she was not a person covered by the relevant Community regulations, the Dutch courts sought guidance with respect to the scope of these regulations, particularly whether they could affect a right acquired solely under national legislation, especially when not all of the people involved were covered by them. The Court first clarified that the purpose of Community legislation on family benefits and family allowances is to provide social assistance to workers with dependant families in the form of a contribution by society towards their expenses. The rule against the overlapping of benefits, ie Art 10(1)(a) of Reg 574/72, is therefore designed to prevent duplication of compensation for those expenses. Accordingly, the Court concluded that it is possible to suspend family benefits or family allowances payable under the legislation of one Member State alone, to a person who is not covered by the Community legislation on social security, in respect of a child who is so covered. Suspension is possible even if acquisition of the right to those benefits or allowances is conditional on residence alone. 34

Case 104/84 [1985] ECR 2205.

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316 Changed Family Conditions/Fundamental Principles of Co-ordination The Court justified its decision by emphasising that family benefits are granted for the benefit of children, and so it was unacceptable that the same operative factor, ie the existence of those children, gave rise to the same benefits for the same period paid by two different Member States. The Court maintained that the effect would be to compel society to make an excess contribution towards family expenses. Furthermore, it considered that it was enough for the judgment in the case to ascertain that the child, in respect of whom benefits were paid as member of the family of a working parent, is a person covered by Community legislation ‘without there being any need to ascertain whether the other parent, who does not carry on a professional or trade activity, forms part by virtue of his or her marital status of the family of the first worker and is consequently also a person covered by the legislation in question’.35 In the earlier Robards case, the Court had emphasised that the problem of overlapping benefits, which Art 10(1)(a) of Reg 574/72 is intended to resolve, is not to be answered differently according to whether or not the marriage bond still exists between the two parents who might, depending on the case, be entitled to benefits in respect of the same child.36 Ms Robards, however, was an employed person, which meant that her situation was governed by the second sentence of Art 10(1)(a) of Reg 574/72, while Ms Kromhout was not an employed person, which meant that her situation came within the first sentence of the same Article. The Court did not see any essential difference between these two cases. It maintained that its considerations in the former case apply with equal force in the latter case ‘since the aim of both provisions is to introduce a consistent rule against overlapping benefits which applies both when only one parent carries on a professional or trade activity (first sentence) and when both parents carry on a professional or trade activity (second sentence)’.37 It is worth examining the facts of the Robards case here for the sake of comparison. The Robards Case 38 The Robards case went to the Court prior to the Kromhout case and the facts were as follows: Ms Robards, a British national, was married to Mr Hugh Robards, also a British national, and they lived in Ireland, where Mr Robards worked. The couple had three children. After separating from her husband, Ms Robards, accompanied by her two younger children, returned to the United Kingdom, where she found paid employment. Her husband and the eldest child remained in Ireland. Upon her return to the United Kingdom, Ms Robards received a child benefit from the British authorities. Pursuant to the British national legislation, a child benefit is granted to the person who is responsible for a child, irrespective of conditions of insurance or employment. After the divorce, Mr Robards claimed children’s allowances in Ireland, pursuant to the provisions of Irish legislation and, with regard to the two younger children, 35 Paragraph 15 of the judgment. If the Court had discussed this question as such, we would have had an explicit answer to the question whether former spouses are covered by Reg 1408/71. It is apparent, however, that the question was implicitly answered in the negative. 36 Paragraph 15 of the Robards judgment. 37 Paragraph 16 of the Kromhout judgment. 38 Case 149/82 Robards [1983] ECR 171.

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The Non-overlapping Principle 317 pursuant to Community law.39 Following that decision, the British social security authority withheld Ms Robards’ child benefit payments by virtue of the Community rules against overlapping.40 Ms Robards appealed against the decision to suspend the United Kingdom benefit in respect of her two younger children. The Court held that the suspension of payment of benefits was in line with the provisions of Community law when benefits were granted from two Member States in respect of the same child. However, it underlined that Community rules give priority, in a case of overlapping family benefits, to the benefits of the Member State in the territory in which the children reside and in which one of the recipients pursues a professional or trade activity. The fact that there were no marriage bonds between the parents was irrelevant in this context, said the Court. Ms Robards was thus, due to her employment status, entitled to the benefits by virtue of the second sentence of Art 10(1)(a) of Reg 574/72 giving priority to the legislation of the Member State of residence of the family members if the parent pursues an economic activity there. Ms Robards and Ms Kromhout were both divorced, but while the former pursued an economic activity, the latter did not. The Court was consistent in its decisions, putting the needs of the co-ordination system first, but the difference in terms of the practical outcome of the two cases was enormous. While the economically active Ms Robards—who by reason of her activity was covered by Reg 1408/71—could retain her entitlement to benefits under national law, the right to benefits of the economically non-active Ms Kromhout—who was not covered by Reg 1408/71, as implied in the decision—was suspended up to the amount received by her former spouse. The unequal treatment of economically active and economically non-active persons is more than obvious. In the Hoever and Zachow cases, the Court emphasised that if the grant of a childraising allowance were subject to the condition that the spouse of a worker, who is not resident in Germany, must be employed within the territory to which the German law applies, the worker could be deterred from exercising his/her right to freedom of movement.41 The way in which the Kromhout precedent promotes a worker’s right to freedom of movement is truly questionable: if the wife of the worker (and the worker) knew that she could be deprived of her rights under national law in case of divorce, wouldn’t that knowledge deter her (and the worker) from moving?

2. The Provisions of Reg 883/04 The new Regulation in its original version was to change the priority rules in cases of overlapping family benefits by laying down the rule of the application of the legislation of the Member State providing the highest amount of benefits. However, 39 40 41

Regulation 1408/71, Art. Ibid, Art 73(1), and Reg 574/72, Art 10(1). Paragraph 35 of the Hoever and Zachow [1996] ECR I-4895).

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318 Changed Family Conditions/Fundamental Principles of Co-ordination the rule of priority of the legislation of the Member State of employment remained as it had been under Reg 1408/71.42 No essential changes seem to have been brought about in this respect.

CONCLUDING REMARKS

The question posed in this chapter was whether the co-ordination principles of aggregation, exportability and non-overlapping of benefits principles apply to unmarried and registered partners as well as to former spouses. In order to answer this question, it was necessary first to explore whether these principles and the pertinent provisions of Reg 1408/71 (and Reg 883/04) apply to family members. The analysis has shown that the aggregation principle applies to family members when the benefits at issue are sickness/maternity benefits. In contrast, it does not apply when the benefits at issue are unemployment benefits since these benefits are strictly employment-related and cannot be acquired by a person in their capacity as a family member. There is no case law concerning the application of the aggregation principle to family members when the benefits at issue are old age or family benefits. As regards Reg 883/04, the insertion of a general aggregation provision speaks for the application of the principle to family members with respect to all benefits other than unemployment benefits. The exportability of sickness/maternity benefits is envisaged by the specific provisions of chapter one of Title III of Reg 1408/71. The exportability provisions concerning old age or family benefits apply to family members, as indicated in the relevant case law. The exportability principle ought not to be applicable to family members when the benefits at issue are unemployment benefits, due to the strictly employment-related character of these benefits. Regulation 883/04, on the other hand, contains a general exportability provision covering all benefits (apart from special non-contributory cash benefits) which ought to be applicable to all persons covered by this Regulation, including family members. There is no case law or any other indication that the concept of family member within the context of these provisions should be defined in a different way to or on criteria other than those laid down in Art 1(f)(i) of Reg 1408/71 or 1(i) of Reg 883/04. Consequently, the aggregation and exportability provisions applying to family members ought to apply even to unmarried and registered partners defined or recognised as family members by national legislation. In contrast, the same provisions should not apply to former spouses. The findings of the analysis concerning the non-overlapping provisions of Reg 1408/71 and the implementing Reg 574/72 are remarkable. It becomes apparent that the application of the non-overlapping rules will affect not only unmarried and registered partners but also former spouses. Former spouses are not covered by Reg 1408/71, though, as implied in the pertinent case law. They will thus not be able to 42

Above, ch 5 at III, 2.

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Concluding Remarks 319 benefit from co-ordination principles that would facilitate acquiring or retaining benefits for them, such as aggregation and exportability. In contrast, they may be deprived of benefits granted to them solely by a national law because of Community law. Regulation 883/04 does not entail any changes in this respect. It is highly questionable whether Community law should produce such effects. This is undoubtedly a very interesting question, though it is not examined here as it falls beyond the scope of this book.

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(J) Paskalia Conclusns

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Conclusions This book has focused on the application of the co-ordination regulations, currently in force, in certain specific situations that have emerged as a consequence of dramatic changes in both the public and private spheres of life occurring in recent decades, and that are of major interest from a gender perspective. These concrete situations are: work interruption because of childbirth/child-rearing; work interruption because of migration; and changed family conditions, in particular the emergence of forms of cohabitation other than formal marriage as well as the increasing rates of divorce. Each of these is generally viewed as being problematic. Work interruptions often cause problems within the social security context. Social security systems are often criticised for not adjusting satisfactorily to new family forms and conditions. The aim of this book was thus to explore how well developed the European Community co-ordination system is with regard to these situations; and how efficient it is in co-ordinating the national systems in order to protect people finding themselves in one or several of these situations. The aim more particularly was to identify possible problems or gaps in the system that impede not only the sufficient protection of the people finding themselves in these situations but also the realisation of the right to free movement. In order to achieve this aim, specific segments of Regs 1408/71 and 883/04 were chosen for examination and two sets of questions were posed. The segments chosen are the personal scope provisions of the co-ordination system as established in the two Regulations, its choice of law provisions, and the provisions concerning the principles of aggregation, exportability and non-overlapping. These principles were examined in relation to certain specific branches of social security covered by Reg 1408/71, namely sickness/maternity, old age, unemployment and family. The first set of questions posed refers to work interruptions, the second to changed family conditions. Each set thus corresponds to one of the bases upon which social security rights have traditionally been grounded, namely economic activity and marriage. The first set can be said to concern economically active women, the second economically non-active women. It is very likely, however, that both bases are currently relevant to the social security protection of women. More concretely, the first set of questions included the question whether the personal scope provisions of Regs 1408/71 and 883/04 apply to persons whose economic activity has been interrupted because of childbirth/child-rearing or migration. It was also asked whether the choice of law provisions establishing the

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322 Conclusions principles of single applicable legislation and lex loci laboris, as well as the provisions of the co-ordination Regulations concerning the aggregation, exportability and non-overlapping principles, apply to the same categories of people. The second set of questions included the question whether the personal scope provisions of Regs 1408/71 and 883/04 apply to the unmarried or registered partners of a migrant worker or to people whose marriage to a migrant worker has been terminated. The question was also raised here as to whether the choice of law provisions, as well as the provisions of the two Regulations concerning the aggregation, exportability and non-overlapping principles, apply to the same categories of people. The findings, already partially presented at the end of each chapter, are collected here for a complete picture and general evaluation.

I. THE FINDINGS OF THE BOOK

The findings can be summarised into two groups, the first referring to work interruptions (due to childbirth/child-rearing or migration), the second referring to changed family conditions.

1. Work Interruptions due to Childbirth/Child-rearing or Migration The analysis has shown that people whose economic activity has been interrupted for reasons of childbirth/child-rearing or migration are covered by both Regulations. The difference between the two regulations is that under Reg 1408/71 the scheme at issue must be employment-related, while under Reg 883/04 any scheme, employment-related or not, can bring a person within the scope of the coordination system. Seen from the perspective of (female) workers interrupting work, this development has not been essential. The analysis has also shown that people whose economic activity has been interrupted because of childbirth/child-rearing or migration are covered by the choice of law provisions of Title II of the Regulations. This means, primarily, that these people are covered by the principle of single applicable legislation, which is one of the two main principles established in this Title. Problems and complications exist, however, with regard to the second main principle, namely the lex loci laboris principle. The analysis has shown that, under Reg 1408/71, persons interrupting work because of childbirth/child-rearing are very likely to be subject to another principle found in the system of the choice of law rules, namely the principle of lex loci domicilii. In some cases, however, in particular when the benefits at issue are old age benefits, the case law suggests the application of the legislation of the Member State of last employment by virtue of the lex loci laboris principle. Additional uncertainty seems to exist regarding the application of the lex loci laboris and lex loci domicilii

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The Findings of the Book 323 principles to people interrupting work because of migration. There has been a discussion as to which principle ought to apply to unemployed persons. The new Reg 883/04 clarified certain issues regarding determining the applicable legislation in the case of work interruption, but it is likely to cause new complications. For instance, problems may emerge as to the determination of the applicable legislation when the benefits at issue are old age benefits concerning periods devoted to child-rearing. It was shown in the analysis that cases dealing with the question of the applicable legislation when work interruption because of childbirth/childrearing had occurred, have most often been solved by invoking European citizenship directly and with that the right of all European citizens to move freely—ie outside the principles of the law of co-ordination. From the perspective of the category of people at issue here, these developments cannot be considered satisfactory and further clarifications with regard to several issues are needed. As to the principles of aggregation, exportability and non-overlapping benefits, the analysis has shown that the aggregation principle applies to people who have interrupted work because of childbirth/child-rearing when the benefits at issue are residence-based sickness/maternity benefits. Uncertainty exists with regard to employment-related benefits. It also appears to be applicable when the benefits at issue are unemployment benefits claimed in the Member State of new residence. Furthermore, according to Reg 1408/71, the aggregation principle applies to persons interrupting work because of migration as regards all four categories of benefits examined in this book provided that they are regarded as unemployed people. This condition, however, raises issues as to the definition of the concept ‘unemployed’, in particular whether this concept is sufficient to embrace people (most often women) interrupting economic activity because of (family-related) migration. The principle has however been strengthened in Reg 883/04 with the insertion of a general provision on aggregation, which ought to mean that under this Regulation the principle is applicable to all people covered by it with respect to all benefits. From a gender perspective, this must be seen as a positive step. The exportability principle applies to people who have interrupted work because of childbirth/child-rearing when the benefits at issue are sickness/maternity benefits as well as in cases of family benefits. The exportability principle applies to people interrupting work because of migration when the benefits at issue are sickness/maternity benefits, unemployment benefits and family benefits, provided that the people concerned are regarded as unemployed people. Even this principle was strengthened in Reg 883/04 and is to apply with respect to all benefits, long-term as well as short-term, by virtue of a general provision which must be understood as applicable to all people covered by the new Regulation. This too must be seen as a positive development. The non-overlapping principle affects people who have interrupted work because of childbirth/child-rearing or migration when the benefits at issue are family benefits. There are no differences between the two regulations in terms of this issue.

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324 Conclusions The analysis has also shown that there are several questions which cannot be answered at this current stage of development of Community law. For instance, no certain answer can currently be given as to whether the right to family benefits of the working parent should be given priority over the right to the same benefits of the parent having interrupted work because of child-rearing. Within this context it should be noted that the existence of two regulations, which are both in force, is quite confusing as it is not certain whether Reg 883/04 should be considered as being indicative of the current state of law with respect to issues where no answers can be given according to Reg 1408/71. It has also been shown that the principles of co-ordination may be insufficient in some respects. For instance, neither the principle of aggregation nor the principle of exportability appears to be fit or sufficient for the purpose of acquisition or retaining old age benefits concerning periods devoted to child-rearing in another Member State. The new principle of assimilation of facts has been examined, although the new Regulation does not apply yet, and it has been seen that the principle will potentially fill in some gaps. So far the acquisition of the right to such benefits was based on other legal authority in the case law than the principles of coordination—most notably the Treaty provisions concerning the right to free movement enjoyed by citizens of the Union.

2. Changed Family Conditions The analysis has shown that unmarried and registered partners are covered by Reg 1408/71 as well as Reg 883/04 if they are regarded as family members of the worker by the national legislation under which the benefits are provided. Divorced and separated spouses do not appear for the time being to be able to fall within the scope of either Reg 1408/71 or Reg 883/04. In any case, however, the issue of the application of the co-ordination system to unmarried and registered partners as well as former spouses is ultimately dependent on the provisions of national legislation. The choice of law provisions do not explicitly refer to family members. It appears, however, that under Reg 1408/71 the applicable legislation is the legislation of the Member State of employment of the worker. Under Reg 883/04, the applicable legislation is the legislation of the Member State of residence unless the family member is entitled to benefits from the Member State in which the worker is employed. This order of priority, however, can be problematic from a gender perspective, especially if it results in depriving the family member of improved benefits to which s/he may be entitled according to the legislation of the Member state of residence . As for the principles of aggregation, exportability and non-overlapping of benefits, the analysis has made the following observations. According to Reg 1408/71, the aggregation principle applies to family members, and consequently to unmarried and registered partners defined or recognised as such by national legislation, when the benefits at issue are sickness/maternity

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Final Remarks 325 benefits. However, it is not applicable to former spouses. The aggregation principle does not apply to any of these three categories of people when the benefits at issue are unemployment benefits since these benefits are strictly employment-related and cannot be acquired by a person in their capacity as a family member. It is uncertain whether the principle is applicable to family members when the benefits at issue are old age or family benefits. According to Reg 883/04, on the other hand, the principle must be considered applicable to family members with respect to all benefits. Former spouses are, however, excluded. The exportability principle applies to family members, and consequently to unmarried and registered partners defined or recognised as such by national legislation, when the benefits at issue are sickness/maternity benefits by virtue of specific provisions of chapter one of Title III of Reg 1408/71. It also applies when the benefits at issue are old age or family benefits by virtue of the case law. The principle applies to family members even according to Reg 883/04 and it covers all sorts of benefits. However, it does not apply to former spouses. The exportability principle is obviously not applicable to any of these three categories when the benefits at issue are unemployment benefits, due to the strictly employment-related character of these benefits. The results of the analysis concerning the non-overlapping principle were somewhat sensational. The principle affects not only unmarried and registered partners but also former spouses. Application of the principle may have considerably adverse effects, in the sense that it may deprive a person of rights acquired under national legislation. For former spouses, who are not even covered by the coordination system according to any Regulation and are thus not affected by the benefits of co-ordination, such a result is particularly burdensome. Finally, the analysis undertaken in this book demonstrated that it was not currently possible to answer all of the questions.

II. FINAL REMARKS

All in all, the analysis has shown that there are problems in all for the areas covered by this book, namely work interruptions because of childbirth/child-rearing, because of migration and in relation to changed family conditions. The problems concern the insufficiency of certain fundamental concepts and principles of coordination, as well as gaps within the system. The situation of people interrupting work can be problematic in several respects. Under Reg 1408/71, for instance, the concept of ‘employed’ has been shown to be inadequate to safeguard employment-related benefits for people whose economic activity has been interrupted because of childbirth/child-rearing, as it does not always embrace them. Employment-related benefits may thus be lost due to the application of the lex loci domicilii principle to this category of workers. Family benefits in general can be lost due to the application of the non-overlapping principle. As the issue of whether the concept of ‘employed’ covers people who have

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326 Conclusions interrupted work because of childbirth/child-rearing has not been addressed, it is not clear whether the right of these people to family benefits should take priority over the right of the working parent. The concept of ‘unemployed’ has also been demonstrated to be inadequate to safeguard the rights to social security benefits of workers who interrupt work because of (family-related) migration. Such rights are ultimately determined by the national legislations while the Community has not taken any steps in or paid any attention to this area. The principles of co-ordination may also be insufficient. For instance, the aggregation and exportability principles do not seem to be sufficient to safeguard the right to old age benefits for periods devoted to child-rearing in another Member State to workers having interrupted work because of childbirth/child-rearing. The case law offers some solutions, but more general solutions are needed. Regulation 883/04, on the other hand, arguably entails improvements with respect to several issues. The problem of determining the applicable legislation is resolved in a way that can help workers interrupting economic activity because of childbirth/child-rearing to retain employment-related benefits. The concept of ‘unemployed’ loses almost all its significance since the focus of the new Regulation is the insurance status of a person, which does not need to be employment-related. New problems, however, are likely to arise. For instance, complications are likely to occur with respect to determining the applicable legislation when the benefits at issue are old age benefits for periods devoted to child-rearing. The strengthening of the aggregation and exportability principles as well as the entrenchment of the principle of assimilation of facts must be considered as positive developments, albeit insufficient ones. The new Regulation has failed to embrace significant developments such as the development of the criterion of ‘sufficiently close link’ as well as the strengthening of the importance of the principle of free movement and European citizenship within the context of co-ordination. In general, the co-ordination system is not very well adjusted to the needs of (often female) migrant workers who interrupt work because of childbirth/childrearing or migration, that is to say in order to combine professional and family life. Despite some steps towards modernisation, the system has not yet risen satisfactorily to the current major challenge of reconciling working and family life. When it comes to its adjustment to the changed family conditions, the system displays considerable gaps. Regulation 1408/71 is not adjusted at all to new family conditions, in particular the emergence of cohabitation outside marriage, registered partnership and increasing rates of divorce. The protection of the people concerned under Reg 1408/71 is ultimately dependent on the national legislation. Surprisingly enough, Reg 883/04 does not entail any changes at all in this respect. Of particular concern is the issue of former spouses. Former spouses are the only category to fall completely outside the scope of co-ordination, although they can occasionally be negatively affected by it, mainly due to the non-overlapping principle within the context of family benefits. There appears, however, to be an imperative need to take this group into consideration since social security may be the

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Final Remarks 327 only available institution of protection in a migration context. It should be noted here that while a review of the national systems reveals considerable differences concerning the social and legal institutions of cohabitation and registered partnership, which justifies the reservation of Community law, it shows a consensus in terms of the need to protect ex-spouses following termination of marriage. From the perspective of the categories of people under examination in the book, and a gender perspective in general, the modernisation of the co-ordination system that has been attempted through Reg 883/04 cannot be considered sufficient or satisfactory. Despite progress in several contexts, a lot remains to be done. Most neglected seem to be people entering the system as a family member or whose social security protection is based on the criterion of marriage. It seems that while Reg 1408/71 was based at the time of its adoption on the assumption that women’s social security protection is based on marriage, the new Regulation is based on the assumption that women’s social security is or should be based on economic activity. It is an assumption that has been adopted to different degrees by most national social security schemes. However, this assumption is also likely to prove erroneous and problematic as it disregards the peculiarities of migrant women’s life trajectories. Migrant women obviously shift between paid employment and marriage more often than local women and with more adverse consequences. They find it more difficult to join the labour markets of the Member States, for instance, as compared both to local women and to male workers. Despite the focus on improving women’s employment rates and conditions in general, no special measures are addressed at European migrant women, which is virtually an invisible group, while their demographic situation is virtually unknown. Improvements of the current state of law and satisfactory modernisation would require solutions in the following areas: — The issue of determining the applicable legislation in the case of work interruption for childbirth/child-rearing, in particular for the purpose of acquiring rights to old age benefits during periods of child-rearing. — The issue of classifying benefits related to maternity/family needs taking into consideration the peculiarities of each national system. — The issue of the impact of the non-overlapping rules on the rights to family benefits of persons interrupting work because of childbirth/child-rearing. — The issue of the application of the co-ordination system to persons interrupting work because of migration. — The issue of the application of the co-ordination system to former spouses as well as the question of the impact of the non-overlapping principle on their right to family benefits acquired under national legislation. Furthermore, new principles of co-ordination with an emphasis on the right of free movement and European citizenship within the framework of co-ordination must be developed. Finally, the issue of information must be addressed. Information guides published by the European Commission, for instance, place the emphasis on the rights

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328 Conclusions of a worker in cases of movement. Possible problems and complications are not addressed at all.1 The fact, however, is that problems and complications are likely to arise with regard to the three scenarios discussed in this book, which are common in cases of female migration. False impressions may thus be created and wrongful expectations built up in terms of the social security rights that are available in cases of migration.

1 For instance, the European Commission’s brochure, Your Social Security Rights When Moving Within the European Union: Update 2004 (Office for Official Publications of the European Communities, Luxembourg 2003), provides useful information on the provisions of the national systems and the benefits available in different Member States, but says nothing about potential problems. Thus, the false impression is created, for instance, that everyone who moves is a receiver of all the benefits named in the Member State of destination.

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Index Aggregation principle application, 6, 10, 58, 199 basis, 201 changed family conditions, 305–306 consistent principles, 202 EC Treaty, 200 efficiency, of, 267, 326 family members family benefits, 305 maternity benefits, 302, 318, 323 old age benefits, 303 Regulation 883/04: 305 Regulation 1408/71: 302–305 residence requirements, 302 sickness benefits, 302, 318, 323 unemployment benefits, 303, 304, 318 former spouses, 325 gender perspective, 323 insurance periods, 201 objective, 201 specific benefits, 201 Title I (Reg. 883/04) aggregation provisions, 211 personal scope, 211 Title III (Reg.1408/71) aggregation provisions, 201, 202 family benefits, 209–10 maternity benefits, 202, 203 old age benefits, 203–207 personal scope, 202 residence periods, 203 sickness benefits, 202 unemployment benefits, 207–209 work interruptions childbirth/child rearing, 212–13, 267 migration, 213, 268 Assimilation of facts principle benefits, of, 267 entrenchment, of, 326 generally, 267 migrant women, 267 Regulation 883/04: 267 Atlantic (Beveridgean) model benefits, 35 participating countries, 35 social citizenship, 35 social structure, 35 universality principle, 33 Baumbast and R Case background, 294

children’s rights, 295 divorced spouses, 294 immigration status, 294 residence rights, 294, 295 Bergemann Case aggregation principle, 209 and see Aggregation principle background, 208 employment relationship, 231 family-related migration, 230 frontier workers, 209 residence requirements, 223, 224, 229 unemployment benefits, 208, 209, 229, 230 voluntary unemployment, 230 Beveridge Report beneficiaries, 28 benefits, 28, 29 contributory principle, 29–31 demographic issues, 88 gender aspects, 70–72 health care, 28 impact, 29, 30 residence-based systems, 70 social citizenship, 30, 31, 70, 72, 102 social insurance, 70 ‘standard employment’ relationship, 72 standard of living, 28 universality principle, 28, 29, 70 Bilateral agreements equal treatment, 48 growth, of, 48 Bismarckian model see Continental (Bismarckian) model Breadwinner concept dual breadwinners, 42, 76 gender models moderate male breadwinner, 96–8 strong male breadwinner, 93–6 weak breadwinner, 98–100 welfare state models, 68–70 Brusse Case family allowances, 226 residence requirements, 226 voluntary contributions, 226 Burchell Case background, 262, 263 economic activity, 262 non-overlapping principle, 262, 263 suspension of benefits, 263

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330 Index Cabanis-Issarte Case background, 311 equal treatment, 312 exportability principle, 311, 312 family membership, 312 free movement principle, 313 individualisation, 312 old age benefits, 312 Choice of law see also Conflict of laws family members, 297–98, 324 and see Family members gender perspective, 267 legislative change, 138, 139 lex loci domicilii principle application, of, 139, 170, 173, 180, 193, 322 Regulation 883/04: 193–95 Title II (Reg.1408/71), 180, 190 lex loci laboris principle application, of, 139, 170, 173, 180, 183, 192, 322 content, 174–76 country of residence, 174 exceptions, 176–80 multiple employment, 175, 176 Regulation 883/04: 193–195 self-employment, 174, 175 Title II (Reg.1408/71), 180, 181, 183, 184, 186, 189, 190, 192 Regulation 883/04 lex loci domicilii principle, 193–95 lex loci laboris principle, 193–95 multi-centred employment, 193 personal scope, 194–95, 198 self-employment, 194 single applicable law, 193, 194 Regulation 1408/71 (Art.13(2)(f)) application, 186–92 background, 184–86 effects, 192, 193 lex loci domicilii principle, 193 provisions, 183–84 residence criteria, 184 temporary work interruption, 186–92 Regulation 1408/71 (Title II) definite cessation of work, 182–83 lex loci domicilii principle, 180, 190 lex loci laboris principle, 180, 181, 183, 184, 186, 189, 190, 192 main principles, 182–83 personal scope, 180–93, 198 temporary interruption of work, 183 simplification, 138 single applicable law appropriateness, 172 exceptions, 171–72 general principle, 139, 171, 183, 192, 297, 322

work interruptions childbirth/child-rearing, 139, 195–96, 198 migration, 139, 197, 198 Classification of parental benefit co-ordination regulations, 256–58 Regulation 1408/71: 251–55 Cohabitation co-ordination system, and, 272, 286, 287, 298, 321, 324 EU Member States, in, 275, 277, 278, 280, 281 exportability principle, 325 migrant workers, 322 national laws, 290 non-overlapping principle, 325 Conflict of laws choice of law see Choice of law negative, 170, 192 positive, 170 Continental (Bismarckian) model fragmentation, 34 insurance principle, 34 origins, 25, 26, 34 participating countries, 34 work performance basis, 33, 34 Contributory principle Beveridge Report, 29–31 and see Beveridge Report social insurance, 21 social security, 21, 40, 68 Convergence national systems, 60, 101 social protection, 61 Co-ordination Regulations assessment, 326, 327 choice of law see Choice of law economic activity see Economic activity European citizenship, 327 female migration see Female migration gender perspective, 327 information guides, 327, 328 movement condition, 152–54 nationality condition, 154–56 personal scope case law, 138 ‘employed or self-employed persons’, 138 Regulation 883/04: 138, 162–68, 265, 321, 322 Regulation 1408/71: 138–40, 157–62, 263–64, 321, 322 Regulation 883/04 see Regulation 883/04 Regulation 1408/71 see Regulation 1408/71 simplification, 138

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Index 331 work interruptions child bearing/child-rearing, 137, 139 migration, 137, 139 Council of Europe equal treatment, 53 labour mobility, 55 migrant workers, 52, 53 social security benefits, 52 D and the Kingdom of Sweden marriage, concept of, 282, 283 Death grants entitlement, 164, 271 Declaration of Human Rights and the Rights of Citizens social assistance, 21 Demographic issues birth rates, 88 demographic changes, 39, 62, 63, 101 demographic concerns, 39, 65, 70, 88, 105 family conditions, 39, 63 gender aspects, 101 infant mortality, 88 influences, 87–89 public health concerns, 88 Dependency divorce, effects of, 271 economic handicaps, 102 economic security, 271 male breadwinner, 95 risk/need relationship, 42 social risk, 45, 63 Derived rights family benefits, 309, 311 family members, 103, 105 individualisation, 43, 102 and see Individualisation occupational derivation, 31 parental leave, 250 protection, through, 105 retention, 102 social citizenship, 31 social insurance, 31 value, 102 Di Paolo Case presumption of residence, 223 retention of residence, 223 Diatta Case family membership, 293, 294 legal separation, 293 residence permits, 293 residence requirements, 293 Divorce divorce rates, 119, 120, 287, 321 effects, of, 271, 272, 298 national laws, 289–91 Dodl and Oberhollenzer Cases background, 191

child-rearing allowances, 191 employed person status, 191, 257 parental leave, 191 priority rules, 265 work interruption, 191, 257 Economic activity benefits based, on, 259–62 not based, on, 262–63 civil servants, 159 contracts of employment, 157 early retirement, 160, 161 free movement of labour, 111, 112 full-time employees, 157 lack, of, 160–61 lex loci laboris principle, 262 migration, and, 9 non-overlapping principle, 258, 259 and see Non-overlapping principle part-time employees, 157, 158 priority rules, 269 self-employment, 157–59 work interruptions, 322, 323 and see Work interruptions Economic integration theories economic growth, 55 free movement of labour, 54, 55 impact, of, 55 migration, 114 welfare growth, 55 Economic model of integration co-ordination, 58 EU Member States, 56–60, 63 free movement of labour, 56, 57 harmonisation, 58 integration, 58 legislative development, 56, 57 migrants, 57 Elsen Case background, 189, 204 child-rearing, 189, 204–206 choice of law lex loci domicilii principle, 190 lex loci laboris principle, 189 definite cessation of work, 189, 196 frontier workers, 204 insurance periods, 204, 205 maternity leave, 189 old age benefits, 189, 204 ‘Employed or self-employed’ persons contracts of employment, 140 economic activity, 141, 143 meaning, 142–43 Regulation 1408/71: 138–52 Unger Case, 141–42 see also Unger Case

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332 Index Encompassing model welfare state, 39 Equal treatment bilateral agreements, under, 48 EC Treaty, 282 multilateral agreements, under, 49 provisions, covering, 51, 52, 53, 54 same-sex partnerships, 282 sexual orientation, 282 Equality feminism see also Feminism Anglo-American discourse, 77 basis, 74 dual-breadwinners, 76 dual-carers, 76 human rights, 74 labour market access, 75, 76 participation, 76 political aspects, 77 single women, 74 welfare services, 75 European citizenship free movement of labour, 112 rights, attaching to, 161, 16, 327 status, 161, 162, 327 European Coal and Steel Community (ECSC) economic cooperation, 56, 57 formation, 55 free movement of labour, 56 European Commission information guides, 327, 328 European Free Trade Area (EFTA) co-operation, within, 55 formation, 55 European Community (EC) social dimension, 2 European Convention on Social and Medical Assistance (No 14) provisions, of, 52, 53 European Convention on Social Security provisions, of, 53 European Health Insurance Card introduction, of, 219, 228 European Social Charter provisions, of, 53, 61 Exportability principle application, 6, 10, 58, 199, 200 changed family conditions, 313–14 cohabitation, 325 EC Treaty, 200, 214 efficiency, of, 267, 326 family members, 306–13 former spouses, 325 individualisation trend, 311–13 registered partnerships, 325 Regulation 883/04 benefits in kind, 234

exportability provisions, 233 family benefits, 235, 238 family members, 313, 318 long-term benefits, 233 maternity benefits, 238 paternity benefits, 238 personal scope, 236 short-term benefits, 233, 236 special non-contributory benefits, 234 temporary stays abroad, 234 unemployment benefits, 235 Regulation 1408/71 exportability clause, 14 long-term benefits, 214 old age benefits, 214 special non-contributory benefits, 215 Title III (Reg.1408/71) family benefits, 225–26, 231–33 maternity benefits, 215, 227 old age benefits, 219, 228 personal scope, 226–33 residence provisions, 216, 217 sickness benefits, 215, 227, 228 temporary stays abroad, 217–19 unemployment benefits, 219–24, 228–31 work interruptions childbirth/child rearing, 236–37, 268 migration, 237–38, 268 Family allowances introduction, of, 26, 67 meaning, 247 periodic payments, 247 priority rule, 259 Family benefits aggregation principle, 305 Community law, 324 co-ordination system, 247 definition, 247 entitlement, 226 exportability principle, 225–26, 231–33, 238, 325 and see Exportability principle family membership, 305 maternity benefit, distinguished, 248–50 national systems, 247 non-overlapping principle, 258, 259, 269, 323, 324 residence requirements, 225 Family conditions changes cohabitation, 7, 39, 63, 321, 324 demographic, 39, 62–64 divorce, 39, 43, 63, 119, 120, 271, 272, 298, 321 female employment, 39–42, 63, 64 legal regulations, 272 registered partnerships, 39, 324

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Index 333 Community law cohabitation, 281 concept of family, 280, 281, 283, 284 co-ordination system, 281 equal treatment, 281, 282, 284 free movement provisions, 281 co-ordination system cohabitation, 272, 286, 287, 298 Community law, 281 family/marriage basis, 272 family members, 272, 286, 287, 298 personal scope, 272, 298 registered partnerships, 272, 286, 287, 298 dual-breadwinners, 42 equal treatment, 282 EU Member States cohabitation, 275, 277, 278, 280 definitions of family, 280 legal development, 276–80 national diversities, 276–78, 280 north/south divide, 276, 277 nuclear family, 276 registered partnerships, 275, 278, 280 social development, 275–76 social security laws, 280 family members see Family members gender aspects, 101 marriage, 6, 7, 272 professional/family responsibilities, 41 risk/need relationship, 42 Family members choice of law lex loci domicilii principle, 298 lex loci laboris principle, 298 definition, 273, 274 dependent children, 286 derived rights, 103, 105 EU Member States, 275 exportability principle, 306–13, 325 family benefits, 305, 308, 311, 318 former spouses, 287, 325 maternity benefits, 302, 306, 307, 318 minor children, 273, 286 movement criteria, 285 nationality criteria, 285 non-overlapping principle, 325 old age benefits, 303, 307–308, 318 Regulation 883/03: 285–86 Regulation 1408/71: 273, 274, 280 residence requirements, 302 sickness benefits, 302, 306, 307, 318 spouses, 273, 286 unemployment benefits, 303, 304, 308, 318 Female migration career advancement, 127 child care responsibilities, 120 dual-career households, 120–122

economic focus, 115–117 economic security, 137 employment-related, 125 employment status, 120, 122–29 European Union (EU) Community policy, 128, 129 economic status, 125 employment status, 124, 125 labour activity rates, 124, 125 migration, within, 116–119, 124 part-time work, 125 unemployment, 124, 126, 128 unskilled work, 125 family-centred, 103 family formation, 126 ‘feminisation of migration’, 115 financial autonomy, 126, 127 generally, 8, 9 geographic constraints, 121 independent nature, 117 inhibiting factors academic degrees, 129 caring responsibilities, 130, 131 cultural values, 131, 132 family formation, 130 family responsibilities, 130 health considerations, 132 linguistic skills, 129 marriage, 130 personal attitudes, 131 professional qualifications, 129 marital status dissolution rates, 133 impact, on, 132, 135 marriage breakdown, 137 marriage, effects of, 134 marriage rates, 133 negative effects, 133, 135 married women, 120, 121, 122, 124 motives, 116, 118, 119, 134 negative effects, 122–24, 134, 135 non-economic nature, 119 partner-related, 119, 120, 125, 126 personal status, 137 qualified women, 124 return migration, 127, 128 secondary nature, 104, 114, 120, 134 single women, 122 third country nationals, 116 tied movers, 103, 104, 115, 116, 122, 125, 126 work interruptions, 119, 120, 134, 135, 137, 270 Feminism see also Women access to professions, 73 demographic concerns, 88, 89 economic/civil/political rights, 73 educational opportunities, 73

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334 Index Feminism (cont.): emergence, of, 73 equality feminism see Equality feminism female subordination, 73 feminist theories, 74–78 French feminism basis, 82 demographic influences, 83, 88 ‘equality in difference’ 82 equal opportunities legislation, 84 individualist theories, 83 motherhood, 82 origins, 73, 77 political aspects, 82 pro-natalist character, 82, 83 socialism, 82 German feminism basis, 79 domestic activities, 80 East Germany, 81 feminist unity, 81, 82 post-war reconstruction, 80 right to employment, 80 influence, of, 87–88 liberationalist feminists, 78 maternalist feminism see Maternalist feminism patriarchy, and, 73 perception, of, 78 Scandinavian feminism basis, 84 development, 84, 85 economic independence, 85 emancipation, 87 female employment, 86 industrialism, 86 Key, Ellen, 84, 85, 87 paid work, 85, 87 political aspects, 84 state feminism, 87 Sweden, 84 social policy gender neutrality, 93 gender recognition, 93 gender reconstruction, 93 social rights, 73 voting rights, 73 Former spouses aggregation principle, 325 Community law, 293–96 co-ordination regulations, 297, 299 exportability principle, 325 family members, as, 287, 325 national laws, 288, 291 Regulation 883/04: 326 social security, 291–93

Free movement of labour basic freedom, 112 concerns, regarding, 112, 113 EC objective, 1, 11, 57, 111 EU enlargement, 113 economic activity, 111, 112 economic co-operation/integration, 1, 54–57, 111 fundamental right, 112 labour shortages, 111 labour surpluses, 111 mass migration, 112 see also Migration residence, 112 social policy, 114 social security systems, and, 57 social tourism, 113 universal application, 112 Frontier workers benefit entitlement, 307 determination, of, 209 provisions, affecting, 204 status, 230 unemployment, 222 Fundamental principles of co-ordination aggregation principle, 6, 10, 58, 199 and see Aggregation principle exportability principle, 6, 10, 199, 200 and see Exportability principle choice of law lex loci domicilii principle, 5 lex loci laboris principle, 5, 6, 9 and see Choice of law migrant workers, 5 non-discrimination principle, 5 non-overlapping principle, 6, 10 and see Non-overlapping principle Garcia Case family benefits, 231 residence requirements, 231 Gender models of welfare state breadwinner model, 68–70, 90, 92, 93 catergorisation, 91 EU influences, 101 feminist theories, 65, 72 gender neutrality, 93 gender profile, 5 models individual models, 92 late female mobilisation model, 92 recognition model, 92, 93 reconstruction model, 92, 93 reinforcement model, 92 moderate male breadwinner characteristics, 97 female employment, 97, 98 French system, 96

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Index 335 health care, 97 maternity benefits, 97 right to employment, 98 Protestant Social Democratic welfare states, 92 residence-based systems, 70–72 strong male breadwinner characteristics, 93 family responsibilities, 96 female dependence, 95 female employment, 93, 94 German system, 93–95 public/private responsibility, 93 reinforcement, 93 weak breadwinner model caring relationships, 101 child care, 99, 100 female employment, 99 maternity benefits, 99 ‘modernised motherhood’, 98 parental leave, 100 social policy, 99, 100 Swedish system, 98 work-based systems, 66–70 Grant Case cohabitation, 282 equal treatment, 282 same-sex partnerships, 282 Harmonisation economic integration, 58 Hoever and Zachov Cases background, 251 exportability principle, 309 family benefits, 251–54, 309 family expenses, 252, 253, 256 family membership, 310, 312 parental benefit, 254, 255 residence requirements, 252, 310, 317 Hughes Case derived rights, 309 exportability principle, 309 family benefits, 309 family membership, 309 residence requirements, 309 Individualisation derived rights, 43, 102 feminism see Maternalist feminism individualisation of rights, 44, 102 individualisation trend, 43, 102, 105, 311–13 Integration principle cultural/human relationships, 112 state powers, 112 International Labour Organisation (ILO) equal treatment, 51, 52 ILO Social Security (Minimum Standards) Convention, 20, 52, 61

migrant workers, 51 role, of, 51 International organisations Council of Europe, 52, 53, 55 impact, of, 50, 51 International Labour Organisation (ILO), 51, 52 International social security law bilateral agreements, 48 co-ordination, 46, 47, 58 economic activity, 63 see also Economic activity economic security, 271 employment-based systems, 63 functions, 46 meaning, 46 migrant workers, 46, 47 minimum standards, 46 multilateral agreements, 49, 50 residence-based systems, 63 Kauer Case child-rearing, 190, 191, 206, 207 relevance, 198 social security system affiliation, 190, 191 insurance periods, 206 receipt of benefits, 190, 191 work interruptions, 190, 196 Kermascheck Case aggregation principle, 303, 304 background, 303 equal treatment, 304 family membership, 303, 304, 310 unemployment benefits, 303, 304 Key, Ellen influence, of, 84, 85, 87 Kohll Case movement condition freedom to provide services, 153 prior authorisation, 153 sickness benefits, 153, 154 Kromhout Case background, 315 family benefits, 315, 316 family allowances, 315, 316 marriage dissolution, 315 non-overlapping principle, 315 suspension of benefits, 315 Kuusijärvi Case background, 253 choice of law lex loci domicilii principle, 186 lex loci laboris principle, 186, 188, 190 economic activity, 228 parental benefit, 254, 256 parental leave, 186, 188, 189, 228, 253 residence requirement, 253, 254

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336 Index Kuusijärvi Case (cont.): unemployment, 188 unemployment benefits, 253 work interruptions, 186, 188 Laborero and Sabato Cases insurance requirements, 148 worker status, 160 Labour market feminisation, 39–42, 63, 64, 101, 102 gender aspects, 101 self-employment, 40 unemployment, 39, 40, 63 unemployment benefits, 40 Latin rim countries welfare model characteristics 36 participating countries, 36 Lex loci domicilii principle choice of law, 5, 139, 170, 173, 180, 193, 322 family members, 298 Regulation 883/04: 193–95 Regulation 1408/71: 180, 186, 190, 193 Lex loci laboris principle choice of law, 5, 6, 9, 62, 139, 170, 172, 173, 180, 183, 192, 322 content, 174–76 country of residence, 174 economic activity, 262 exceptions, 176–80 family members, 298 multiple employment, 175, 176 non-overlapping principle, 262 Regulation 883/04: 193–95 Regulation 1408/71: 180, 181, 183, 184, 186, 188, 189, 190, 192 self-employment, 174, 175 Liberationalist feminism see also Feminism concept, 78 Long-term benefits entitlement, 323 exportability principle, 214, 233, 323 and see Exportability principle Maaheimo Case background, 255 family benefits, 255 parental benefits, 255 parental leave, 255 Marriage co-ordination system, and, 272 dissolution rates, 13 marital status, 133 marriage breakdown, 137 marriage rates, 133 migration, and, 9, 130, 133, 134, 137 see also Female migration

social security entitlement, 119 termination see Termination of marriage Marshall, 30 Martinez Sala Case background, 161 Euorpean citizenship, 162 residence permits, 161, 162 social rights, 161, 162, 167 worker status, 162 Maternalist feminism see also Feminism access to professions, 75 basis, 74, 76 decline, 77, 78 ‘equality in difference’, 75 influence, of, 76 maternity benefits, 75 maternity leave, 75 motherhood, 74 political aspects, 77 property rights, 75 social rights, 75 state action, 75 women’s rights, 74 Maternity benefits aggregation principle, 202, 203, 302, 318, 323 co-ordination system, 244–46 definition, 239 entitlement, 75, 163, 164 exportability principle, 215, 227, 238, 323, 325 family benefits, distinguished, 248–50 introduction, of, 26, 67 national systems benefits in cash, 243–44 benefits in kind, 239–40 maternity leave, 240–43 variations, 249, 250 Regulation 1408/71: 239 Maternity leave benefits, 67 compulsory leave, 242 Denmark, 241 entitlement, 66, 67, 75 financing of benefits, 243 Finland, 241, 243 France, 241 Italy, 241 loss of earnings, 66 national variations, 240–42 Portugal, 241 pre-confinement period, 242, 243 structure, 240–42 Sweden, 240–41 McMenamin Case background, 261 family benefits, 261 frontier workers, 261

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Index 337 non-overlapping principle, 261 residence provisions, 261 suspension of benefits, 261 Migrant workers cohabitants, 322 co-ordination principles, 5 registered partnerships, 322 spouses, of, 7 unemployment benefits, 221 Migrants economic migrants, 49, 50, 107–109, 114, 115 ‘guest workers’, 109 highly qualified, 109, 110 illegal, 109, 111 male breadwinners, 103–105 salary differentials, 110, 113 Migration economic activity, 9 economic migration, 49, 50, 107–109, 114, 115 European Union (EU) enlargement, effect of, 113 migration, within, 107, 108, 110–13 family formation, 109 family-related, 3 family re-unification, 109, 111 female migration see Female migration gender aspect, 114, 115 illegal, 109, 111 impact, of, 9 intra-firm, 109 labour shortages, 111 marriage, and, 9, 130, 133, 134, 137 mass migration, 112 motivation economic, 115 political, 108, 109 short-term, 110 skilled labour, 107, 109 social tourism, 113 temporary, 109 tied movers, 103, 104, 115 voluntary, 109, 114 work interruptions, 8, 9, 10, 13 MISSOC health care schemes, 166 legal source, 13, 166, 167, 274 maternity benefits, 239, 240 maternity leave, 242, 243 Models of welfare state Atlantic (Beveridgean) model, 33, 35 see also Beveridge Report basic security model, 39 conservative ‘coroporatist’ welfare state, 36, 37 Continental (Bismarkean) model, 25, 26, 33, 34 and see Continental (Bismarkean) model corporatist model, 29, 39

de-commodification effects, 38 meaning, 38 encompassing model, 39 entitlement universal basis, 33 work performance, 33 EU Member States, 32–39, 56–60, 63 industrial achievement-performance model, 38 institutional redistributive model, 38 Latin rim countries, 36 residual model, 38 rudimentary model, 36 Scandinavian (mixed) model, 35 Social Democratic welfare state, 38 universality principle, 38 Modernisation impact, of, 105 Mouthaan Case background, 149 gender implications, 151, 152, 169 lack of insurance, 149, 151 unemployment benefits, 149 worker status, 150, 151 Multilateral agreements development, 49, 50 economic migrants, 49, 50 equal treatment, 49 migrant workers, 49 purpose, 49 Myrdal, Alva and Gunnar, 78, 85, 86, 88, 99, 100 Nationality family benefits, 156 residence legal residents, 155 permits, 156 social citizenship, 32 social security entitlement, 155–56 third country nationals, 154–56 uniform rights, 155, 156 National social security schemes affiliation, 148, 163, 165, 167–68 characteristics, 146, 164–67 economic non-activity, 165, 166 employment-based, 145, 147, 167 entire working population, 147 exclusions, 165–67 lack of insurance, 166, 167 non-contributory cash benefits, 164, 165 notification requirements, 146, 147 residence-based, 145, 148, 167 scope, 145 social security risks, 146 Non-discrimination principle application 5, 58

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338 Index Non-overlapping principle application, 6, 10 co-ordination principle, 258 economic activity benefits, based on, 259–62 benefits, not based on, 262–63 different family member, 260–262 EU Member States, in, 260–62 lex loci laboris principle, 262 priority rules, 264, 269 same family member, 259, 260 self-employment, 259 simultaneous employment, 259 third country residence, 262 family benefits, 6, 19, 258, 259, 269, 314–19 family membership, 314 national level, 258 personal scope, 263–64 Regulation 883/04 non-overlapping provisions, 264 personal scope, 265 priority rule, 264 residence provisions, 264 subsidiary criteria, 264 Regulation 1408/71 economic activity, 259–63 general rule, 259 family allowances, 259 residence provisions, 259 termination of marriage, 315–17 and see Termination of marriage trans-national level, 258 work interruption childbirth/child-rearing, 258, 265–66, 269 migration, 258, 266, 269 Nordic Convention equality principle, 54 personal scope, 54 residence-based system, 63, 104 right to benefits, 53 Offermans Case family benefits, 248 Old age benefits aggregation principle, 303, 303–307 exportability principle, 214, 219, 228 family members, 303, 307–308, 318 termination of marriage, 291, 292 Organisation for European Economic Cooperation (OEEC) free movement of labour, 55 Parental benefits classification co-ordination regulations, 256–58 Regulation 1408/71: 251–55 emergence, of, 250 non-working parents, 251

Parental leave basis, 250 cessation of work, 186, 188, 189 derived rights, 250 entitlement, 100 family right, 250, 251 meaning, 250 status, 242 Partnerships see Registered partnerships Paternity benefits entitlement, 163, 164, 238 Patriarchy challenges, to, 73 family law, 73 property rights, 73 Petit Case movement condition, 152 Piscitello Case background, 308 exportability principle, 308 old age benefits, 308 Posting Article 17 Agreements, 178, 179 determination, of, 177 legislative provisions, 3, 107, 176–78 multiple employment, distinguished, 176 posting period, 176, 179 self-employed workers, 176, 177 Pre-retirement benefits entitlement, 164 legislative changes, 3 Proportionality Legitimate objective, 210 Reed Case background, 281 entry/residence rights, 281 family members, 281, 282 Registered partnerships co-ordination system, and, 272, 286, 287, 298, 324 EU Member States, in, 275, 278, 280 exportability principle, 325 migrant workers, 322 national laws, 290 non-overlapping principle, 325 Regulation 883/04 aggregation principle, 211 and see Aggregation principle choice of law lex loci domicilii principle, 193–95 lex loci laboris principle, 193–95 see also Choice of law exportability principle, 233–36, 238, 313, 318 and see Exportability principle family benefits, 247 family members, 305

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Index 339 former spouses, 326 nationality condition, 168 non-overlapping principle family benefits, 317–18, 319 priority rule, 264 residence provisions, 264 subsidiary criteria, 264 personal scope, 138, 162–68, 265, 321, 322 ‘persons subject to legislation’, 163 social security criterion branches of social security, 163–64 death grants, 164 economic activity, 169, 198 family benefits, 235, 238 maternity benefits, 163, 164, 238 paternity benefits, 163, 164, 238 pre-retirement benefits, 164 social security risks, 163, 164 social security schemes affiliation, 163 co-ordination, 168 national schemes, 164–68 termination of marriage, 296, 299 and see Termination of marriage work interruptions childbirth/child-rearing, 138, 139, 170 migration, 138, 139, 170 Regulation 1408/71 choice of law see Choice of law economic activity, 157–62, 202, 259 and see Economic activity ‘employed or self-employed’ persons, 138–52, 202 exportability principle, 214–31, 306–13, 318 and see Exportability principle family benefits, 247 family members, 273, 274, 280, 302–305 individualisation trend, 311–13 informal economy insurance compulsory, 148 voluntary, 148 lex loci laboris principle, 139 migration, 140 movement condition migrants, 152, 153 prior authorisation, 141, 153 scope, 152 work-related, 152 nationality condition family members, 156 third country nationals, 154–56 national schemes see National social security schemes non-overlapping principle, 259, 314–17, 318 notification schemes, 146, 147

personal scope, 138–40, 157–62, 263–64, 321, 322 posting, 176–78 scope, 146, 151 social insurance see Social insurance social security criterion affiliation, 148 branches of social security, 144–45 national schemes, 145–48 requirement, 140, 143 social risks, 143–45, 148 students, 162 termination of marriage, 296, 299 and see Termination of marriage Title III aggregation provisions, 201, 202 personal scope, 202 residence periods, 203 specific benefits, 202–210 worker status, 149–51 work interruptions childbirth/child-rearing, 138, 139, 149, 157, 168, 169, 267, 268 migration, 138, 139, 149, 157, 169, 170, 267, 268 temporary, 161–62 Residence free movement of labour, 112 legal residents, 155 permits, 156, 161, 162 prior authorisation, 141, 153 residence-based systems, 63, 70–72, 105, 145, 148 residence rights, 112 temporary stay abroad, 141, 142, 152 Robards Case background, 316 economic activity, 316, 316 family benefits, 316 marriage dissolution, 316 non-overlapping principle, 316, 317 suspension of benefits, 317 Scandinavian (mixed) model benefits, 35 income maintenance, 35 social citizenship, 35 Short-term benefits entitlement, 323, 236 Sickness benefits aggregation principle, 202, 302, 318, 323 exportability principle, 215, 227, 228, 323, 325 introduction, of, 26 Simplification choice of law, 138 co-ordination regulations, 138

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340 Index Single applicable law principle see also Choice of law appropriateness, 172 exceptions, 171–72 general principle, 139, 171, 183, 192 Regulation 883/04: 193, 194 Social assistance assessment of need, 22, 23 benefits, 22 charitable origins, 21, 22 development, 21, 22 institutionalisation, 22 means testing, 22 public funds, 22 right, to, 22 social exclusion, 22 territoriality, 22 Social citizenship see also Beveridge Report concept, 30, 31 derived rights, 31 development, 31 full-employment, 30 labour participation, 31 nationality, 32 occupationally-based, 31, 32 universal basis, 31, 32 unpaid work, 102 Social Democratic model welfare state, 38 Social exclusion social assistance, and, 22 Social insurance basis, of, 19 benefits, 21 compulsory, 148 continued payment, 149 contributory principle, 21 derived rights, 31 development, 25–27, 69 human rights, 26 lack of insurance, 149, 166, 167 optional continued basis, 148 previous contributions, 149 private insurance, 20, 21 protection, 19, 66 risks, 20, 23, 26, 66 scope, 26 voluntary, 148 Social policy definition, 16 EC Treaty provisions, 11 free movement of labour, 114 national level, 16–18 Social risks dependency, 45, 63 divorce, 44 emergence, of, 44

income need, 23 insurance principle, 66 uncertain events 23 unemployment, 44 Social security see also Social security systems contributory principle, 21, 40 definition, 15, 16, 18, 19 development, 15, 23 economic pressures, 27 expansion, 27 forms of security industrial world, 24–32 pre-industrial world, 24 fundamental aim, 18 fundamental right, 27 income needs, 23 international level, 15 national level, 16–18 rights, 8 territorial limitations, 15 universality principle, 28, 29 see also Universality principle Social security systems affiliation, 148, 163, 165, 167–68 aggregation principle, 58 and see Aggregation principle changes, 2, 39, 40, 43 contributory principle, 68 convergence, 60 co-ordination, 1–4, 56–58, 104, 107, 168 see also Co-ordination systems earnings-based, 41 economic activity, 6, 7, 271 see also Economic activity economic security, 137, 271 employment-based systems, 63, 105, 145, 147, 167 entire working population, 147 European Union (EU), 56–60, 63 exportability principle, 58 and see Exportability principle family conditions see Family conditions female migration see Female migration female participation contribution payments, 101 minimum earnings, 101 minimum employment levels, 101 free movement of labour, 57 gender perspective, 8, 43, 65, 66 insurance principle, 67–69 legislation complexity, 59, 62, 63 development, 59–62, 64 lex loci laboris principle, 62 migration, 107

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Index 341 national policy, 60 national schemes see National social security schemes non-discrimination principle, 58 personal scope, 7, 10 protection, under, 8, 61 qualification periods, 42, 58 residence-based systems, 63, 105, 145, 148, 167 single legislation principle, 58 social security rights, 8 territorial limitations, 47 trans-national level, 8 work interruptions see Work interruptions Social tourism European Union (EU) enlargement, 113 migration, 113 salary differences, 113 standard of living, 113 Special non-contributory benefits exportability principle, 215, 234 Ten Holder Case background, 184 definite cessation of work, 184 lex loci laboris principle, 184 national insurance schemes, 184, 185 residence-based schemes, 184 sickness benefits, 184 Termination of marriage Community law domestic violence, 296 family life/human dignity, 295 former spouses, 293–96 free movement provisions, 293, 295 residence rights, 294–96 co-ordination regulations former spouses, 297, 299 personal scope, 296–98 Regulation 883/04: 296, 299 Regulation 1408/71: 296, 299 divorce rates, 287 economic independence, 291 former spouses Community law, 293–96 co-ordination regulations, 297, 299 family members, as, 287 national laws, 288, 291 social security, 291–93 judicial separation, 289 legal separation, 289, 291 maintenance payments, 290, 291 mutual agreement, 289 national laws alimony, 288 divorce, 289–91 family law, 288 former spouses, 288, 291

social security law, 288 non-overlapping principle, 315–17 old age benefits, 291, 292 pension schemes, 291–93 Territoriality principle social assistance, 22 Third country nationals female migration, 116 rights, of 154–56 Tied migration see also Migration acceptance, of, 122 female migrants, 103, 104, 115, 116, 122, 126 meaning, 116 Titmuss, 37 Twomey Case background, 227 definite cessation of work, 186, 187 employment status, 227 lex loci laboris principle, 186 sickness benefits, 227 work interruption, 186 Unemployment benefits benefit period, 219–21 entitlement, 219, 220, 228 exportability principle, 219–23, 228, 323 and see Exportability principle family members, 303, 304, 318 free movement conditions, 220 frontier workers, 222 insurance periods, 229 involuntary unemployment, 229 migrant workers, 221 registration requirements, 220, 229 residence provisions, 221–23 unemployment categories, 222 Unger Case active employment, 142 background, 141 economic activity, 157 exportability principle, 227, 236 and see Exportability principle free movement principles, 141 prior authorisation, 141 sickness benefits, 227 temporary stay abroad, 141, 142, 152 temporary work interruption, 161, 227 ‘wage earner or assimilated worker’, 141 worker status, 157 Universality principle Beveridge Report, 28, 29 influence, of, 28, 29, 33 Van Pommeren-Bourgundien Case definite cessation of work, 183 invalidity benefits, 183 relevance, 198

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342 Index Van Pommeren-Bourgundien Case (cont.): unfavourable treatment Van Pouke Case insurance benefits, 145 social security risks, 145 Welfare state see Models of welfare state Women care responsibilities, 92, 102, 130, 131 dependency, 90 and see Dependency derived rights, 103 domestic responsibilities, 68, 69, 102, 103 economic issues economic/civil/political rights, 73 independence, 103 security, 271 emancipation, 73, 75 equality, 73, 103 feminism see Feminism labour market, and, 68, 73, 75, 76 maternity leave, 66, 67 and see Maternity leave migration see Female migration motherhood, 70, 74, 82, 90, 132 pension rights, 103 social rights, 73 social security entitlement employment, 119 insurance principle, 67–69 marriage, 119 national variations, 93 residence-based systems, 70–72 social benefits, 69

social risks, 66 work-based systems, 66–70 unequal treatment, 90 unpaid work, 69, 75, 92, 96, 102 voting rights, 73 working mothers, 70 Work interruptions child birth/child-rearing aggregation principle, 212–13, 267 choice of law system, 195–96, 198 effects, 8, 10, 13, 137, 139, 321–23, 325 exportability principle, 236–37, 268 female migration, 119, 120, 134, 135, 270 non-overlapping principle, 258, 265–66, 269 Regulation 883/04: 170, 197 Regulation 1408/71: 168, 169, 197, 267, 268 economic activity, 322, 323 and see Economic activity family responsibilities, 42 legal regulation, 137 migration aggregation principle, 213, 268 choice of law system, 197, 198 effects, 8, 9, 10, 13, 137, 139, 321–23, 325 exportability principle, 237–38, 268 female migration, 270 non-overlapping principle, 258, 266, 269 Regulation 883/04: 170 Regulation 1408/71: 169, 170, 267, 268 see also Migration non-overlapping principle, 199, 200 and see Non-overlapping principle qualification periods, 42, 43 Zinnecker Case lack of insurance, 150 worker status, 150