Eurozone Update: What innovations can change our course?

Multinational companies in the Eurozone, and in the EU in general, face a nightmare trying to find a single platform for keeping electronic track of time and attendance. As you can see from the following chart, each country has different legal requirements for working hours. Also, overtime requirements and restrictions vary dramatically from country to country. These cross border requirements create havoc when trying to implement an enterprise time and attendance system.

Weekly working hours for men and women

Sources: EU-LFS and FedEE
* 38 hours per week and 130 hours per year overtime.
** Calculated from LFS figures
*** Excludes sickness absence (one week+)
† Effective annual maximum (inc. overtime)
†† May be exceeded with individual consent

The above chart only explains some of the differences between countries. Beginning in 1988, the EU began to actively pursue its social agenda of improving worker's conditions and their social safety net. This agenda included rigid provisions concerning maternity leave, family leave and the ability to work on a part-time basis. While the EU had a single standard for all members, member countries often seized the opportunity to provide even more generous benefits. While employers bear the brunt of these costs, many governments increased pension benefits and other social safety net programs. One who is studying the current Eurozone crisis would not be wrong to heavily score these policies as a major contributor to the debt crisis in the Eurozone.

Surprisingly, the UK had opted out of this policy when it was implemented - a harbinger of its contrariness in today's crisis?

While the idea of more time off was to improve working conditions for all workers, many human resources experts in the EU suggest that the opposite has occurred. With such fractured time required at work, employees are under great stress to know more about how their companies functions. One day they may be working in the sales department and another they are moved to accounts receivable to cover for workers not in attendance. This creates anxiety and lowers productivity, suggest some observers.

Looking at the chart below, it shows that actual work time in the UK is not much greater than the average of all EU countries.

Proportion of weekly working time spent at work*

Sources: EU-LFS and FedEE
* During one reference week in Q3 and Q4 2007
**Includes annual and public leave, maternity and parental leave, sickness absence etc.

Interestingly, the UK, which did not agree to the improved working conditions when they were implemented, has almost no difference from the participating members in average time worked and time off with pay.

Of equal interest is their veto for participation in treaty to salvage the Eurozone that is to be implemented in March of 2012. They will attend the treaty negotiations but only as observers. One wonders if the reluctant Brits will then take away and implement some of the changes that the rest of the EU makes.