8 Establishing a Quality Framework for
Traineeships
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17367/13
+ ADDs 1-2
COM(13) 857
| Draft Recommendation on a Quality Framework for Traineeships
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| Legal base | Articles 153, 166 and 292 TFEU; QMV
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| Department | Business, Innovation and Skills
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| Basis of consideration | Minister's letter of 26 February 2014
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| Previous Committee Report | HC 83-xxx (2013-14), chapter 2 (29 January 2014)
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| Discussion in Council | Agreement expected at 10 March EPSCO Council
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| Committee's assessment | Politically important
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| Committee's decision | Cleared; further information requested
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Background and previous scrutiny
8.1 The draft Recommendation is one of a raft of
initiatives in recent months to tackle high levels of youth unemployment.
Traineeships have become an important means of entering the labour
market but can also be used as a form of unpaid or precarious
employment. In December 2012, the European Council invited the
Commission to finalise work on a quality framework for traineeships
which would improve their learning content, open up the market
for cross-border traineeships, help boost the employability of
young people by developing relevant labour market skills, and
ensure adequate working conditions.
8.2 The main elements of the proposed quality framework
are summarised in our Thirty-third Report, agreed on 29 January
2014. The draft Recommendation establishes a set of principles
to be applied by Member States to "open-market traineeships"
— essentially, work experience offered by employers which
is not part of academic or vocational study, or professional training.
One of the core principles is a written traineeship agreement
setting out clear learning objectives, working conditions (including
working time, holiday entitlement, sick leave arrangements), pay
(if any), the duration of the traineeship and notice requirements.
8.3 The Minister for Skills and Enterprise (Matthew
Hancock) told us that the Government intended to oppose the adoption
of the draft Recommendation and cited the following concerns:
· quality standards should be developed
at national, not EU, level;
· the quality framework would be costly
and burdensome for Government and employers;
· there would be few benefits for employers
or young people;
· the scope of the proposal, and its implications
for the status of trainees under UK employment law, were unclear;
and
· the Prime Minister's Business Task Force
on EU Regulation has made clear that any EU action in this area
should "build on best practice and not resort to legislative
proposals".
8.4 We asked the Minister to clarify the Government's
position on a number of the concerns expressed in his Explanatory
Memorandum, in particular:
· how the principles set out in the draft
Recommendation differed from the outcome anticipated by the Government
in agreeing, by consensus, the December 2012 European Council
Conclusions on a quality framework for traineeships;
· whether, based on the UK's experience
of introducing a quality assurance process for graduate internships,
he considered the trade-off between the quantity and quality
of traineeships to be beneficial or harmful for trainees, employers
and the wider economy;
· whether his concerns regarding the scope
of the draft Recommendation suggested that there should be different
quality standards for graduate internships and other types of
traineeships;
· whether, given uncertainty as to the status
of written traineeship agreements under UK employment law, the
Government had particular legal or policy objections to specifying
the main elements of a traineeship in a written agreement;
· why he considered that the draft Recommendation
would have "a disproportionate negative impact"
on employers already offering 'quality' traineeships while providing
few incentives for those offering 'sub-standard' traineeships,
and to clarify his position on the expected compliance costs for
employers set against the potential gains for trainees; and
· how, given the non-binding status of a
Council Recommendation, he considered that the European
Council's demand for a quality framework for traineeships could
be accomplished by less intrusive EU action.
The Minister's letter of 26 February 2014
8.5 The Minister (Matthew Hancock) accepts that the
December 2012 European Council Conclusions anticipated the establishment
of a quality framework for traineeships but suggests this could
have been achieved without the need for a Council Recommendation.
He continues:
"For example, it might have been possible
for the Commission to have brought forward a much looser 'framework'
which simply highlighted some of the different and successful
national approaches to the design and implementation of traineeships,
without seeking a normative approach. The new Erasmus Plus programme,
which provides for partnerships and best practice exchange within
the vocational training sector, might also have been another possible
vehicle."
8.6 Turning to the quality elements of the proposed
framework, and the impact of quality standards on the availability
of traineeships, the Minister explains:
"As a Government, we have consistently encouraged
employers to offer quality internships and work experience opportunities,
fairly and transparently, to young people and have insisted that
employers must pay their interns in line with National Minimum
Wage legislation. At the same time we don't want to restrict
or even close down such valuable opportunities. I do believe
that trying to achieve this through a prescriptive Framework will
simply limit the number of opportunities. Any attempt to impose
a one-size-fit-all approach risks putting off employers, some
of whom would clearly decide that the extra regulation was too
burdensome and become reluctant to offer opportunities. Likewise,
individuals may be unable or unwilling to accept such opportunities
as they are not flexible enough to be tailored to meet their needs.
"Government does not consider that there
should be different quality standards for graduate internships
and other types of traineeships, but there are still concerns
with the exact definition of 'traineeship'. Discussions are continuing
in Working Group around the precise definition and Member States
have different views about what should be included, with some
wanting the definition broadened. Without knowing the exact scope
of the Recommendation it is not easy to predict its potential
impact. If, for example, more informal periods of work experience
were to be brought within scope of the Recommendation, we would
expect the numbers of employers withdrawing to be much higher.
Some poor quality traineeship opportunities would be lost, without
much cost to young people, but quality opportunities would be
reduced as well. The overall effect of the Recommendation would
be to reduce flexibility for employers and for young people within
the UK labour market, at a time when we need that flexibility
to help young people into work."
8.7 The Minister accepts that it could be helpful
for trainees to have a written record of their rights and obligations
under the traineeship, but adds:
"However, there is a potential risk that
giving trainees the right to have such a record could cause confusion
about employment status. This is because there is no separate
employment status for trainees under UK law at present. Anyone
who is classified as a 'worker' under UK law benefits from certain
statutory employment law rights. An employee has a higher level
of employment law protection and this includes a right to a written
statement of terms and conditions. This is not required for a
worker who is not an employee, although some employers voluntarily
provide these workers with written contracts.
"The nature of the working relationship
determines whether a person is a worker or an employee; some trainees
will not fall into either of these categories. If trainees do
qualify for employment rights, they are more likely to do so as
workers because of the nature of the employment relationship.
If the Recommendation were to be implemented the likely result
is that trainees (regardless of their employment status) would
have a right to written terms and conditions which is only conferred
on employees under UK law. Secondly, there is a slight risk that
the introduction of a written agreement formalises the traineeship
relationship and depending on how it does so, it could impact
on the employment status of the trainee. Government's analysis
of the proposal as it currently stands is that this would not
be the case, but if the requirements become more prescriptive
it could become the case."
8.8 The Minister agrees that implementation of the
draft Recommendation would "present little difficulty"
for good employers whose practices already comply with the quality
elements, but adds:
"Were the UK to adopt the Recommendation,
we would need to monitor its implementation and report back to
the Commission. This would create an extra administrative burden
both for Government and for employers, and some employers would
clearly decide that the extra regulation was too burdensome and
costly and would cease to offer traineeships. At this stage we
do not know how many employers would be affected because we have
no record of the number of internships and traineeships within
scope of the proposal currently offered and no plans to collect
such data."
8.9 The Minister notes that a Recommendation is not
legally binding, but suggests that it "implies a political
commitment to implementation at national level". He continues:
"Both because we see no need for a Council Recommendation,
and because there are significant parts of the text with which
we disagree and have no intention of implementing, I am firmly
of the view that the UK should make clear that we will not be
making that political commitment. Other Member States are, of
course, free to respond as they wish, and the Recommendation will
be adopted if it can command a Qualified Majority in the Council."
8.10 He concludes:
"I should add that my strong preference
for cooperation at EU level on matters to do with tackling youth
unemployment is for looser forms of policy competition and cooperation
between Member States, rather than attempts to co-ordinate approaches
via negotiated agreements in Brussels. In my experience, targeted
bilateral benchmarking and study visits supplemented, where necessary,
by conferences, seminars etc., are much more effective ways of
learning from our European neighbours and raising standards for
all. I can point to several examples of our own policy development
in the area of vocational education and training which have been
heavily influenced by our examination of policy in other EU Member
States. We do not need an EU Council Recommendation, followed
by reporting to the Commission, to achieve that. In my experience,
winning that argument in the relevant Brussels Councils is an
uphill battle. That should not, however, deter us from trying."
8.11 The Minister expects the draft Recommendation
to be adopted at the Employment, Social Policy, Health and Consumer
Affairs (EPSCO) Council on 10 March and invites us to release
the proposal from scrutiny.
Conclusion
8.12 We thank the Minister for his detailed response,
which helps to clarify the concerns expressed in his earlier Explanatory
Memorandum. We understand that the Government intends to oppose
the adoption of the draft Recommendation at the forthcoming EPSCO
Council on 10 March and are content to clear the proposal from
scrutiny. In so doing, we ask the Minister to report back to
us on the outcome of the Council and on any changes made to the
text.
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