On 27th November 2013 the Financial Times published an article by the British Prime Minister setting out measures which the UK authorities will be taking to limit EU citizens’ access to social benefits and their deportation where homeless. The reason for the new measures according to the Prime Minister, was the end of the transitional restrictions on free movement of workers from Bulgaria and Romania which applies in the UK from 1st January 2014. The EU Commissioner for Employment responded the same day warning that the UK risks being seen as a “nasty country” and highlighting the importance of reciprocity in EU free movement laws.
This raises the question “If the Prime Minister’s proposals would place the UK in breach of its obligations under EU law which according to the European Communities Act 1972 is unlawful. As the Prime Minister chose to announce his Government’s new policies in a newspaper article rather than in Parliament, we only have the headline proposals:
- Newly arriving EU citizens will not get out of work benefits for the first three months of their residence in the UK.
- Unemployed EU citizens will have social benefits payments stopped after six months unless they can show that they have a genuine chance of getting a job.
- EU citizens will not be able to claim housing benefits immediately on arrival.
- Those EU citizens who are found sleeping rough will be deported and barred from return for one year.
- Fines for employers who fail to pay the minimum wage will be quadrupled. Please note EU citizens exclude British and possibly Irish citizens.
With regard to the proposition of “no out of work benefits” for the first three months, the EU citizens directive entitles any EU citizen to move and reside in another member state including the UK for up to three months without fulfilling any formalities other than presenting a passport or identity document to the UK Border Agency. Therefore, EU citizens who arrive in the UK and stay for three months can be excluded from social benefits in the whole state. But, if they are searching for work, ie., they are job seekers, it is unlawful to exclude them from benefits of a financial nature intended to facilitate access to employment in the labour market. The Court of Justice of the European Union held this in a case about German benefits in 2009. The answer to the first question is EU citizens can be excluded from UK out of work benefits during the first three months of their stay in the UK but only if they are not job seekers. As to the second proposal of the Prime Minister that EU citizens, who after working in the UK become unemployed will be excluded from social benefits after six months, this seems to confuse two different aspects of EU law.
First, the Court of Justice of the European Union held that EU citizens who are new job seekers in a member state only have a right of residence for as long as they have a genuine chance of finding employment. The Court approved the UK six month rule in general but held that so long as there is a genuine chance that the EU citizen may get a job he or she has a EU right of residence. Where an EU job seeker has a right of residence he or she has a right to equal treatment with British job seekers, including social benefits for more than six months. The second issue is how long does an EU citizen retain the status of worker after he or she has lost his or her job? This question has not been answered clearly yet by the Court.
The Prime Minister appears to assume that the same rule applies both to the first entrance as a job seeker and someone who has already worked for a member state and finds himself or herself unemployed. However, for the second group the existence of a real link with the labour market is the key test. The greater that link, the stronger the claim of the individual to continuing status as a worker. The stronger the link to the labour market the greater the entitlement to all social benefits. If the Prime Minister’s legal argument is that EU unemployed workers in this situation are an unreasonable burden on the UK social assistance system then UK benefits officers must undertake a personal assessment of the EU citizen’s situation in each case. According to the Court of Justice, the test is whether the grant of social security benefits could place a burden on that member state’s social assistance system as a whole so as to justify ending the residence right?
As to the proposal of “no housing benefits on arrival”, as workers EU citizens are entitled to full equality with British workers as regards social advantages. As British workers are entitled to Housing Benefits so too are EU workers who qualify on the same grounds . It would be a breach of EU law to exclude EU workers, no matter how recently they arrived from another member state from Housing Benefits. Where EU citizens come to the UK not as workers but looking for work, the rules on Job Seekers apply and they are also entitled to equality. EU citizens who are not economically active, that is to say students, pensioners and those who do not intend to work are in a different category. It may be lawful under EU law to exclude them from Housing Benefits on arrival.
The proposal of deporting rough sleepers and barring their entry is a problematic proposal. The first group who can’t be subject to deportation when those EU citizens are working or seeking work in the UK. As EU citizens are free to move and reside anywhere in the EU for three months without hinder, they should not be subject to deportation and a re-entry ban just because they are sleeping rough. The directive does permit member states to extinguish the right of residence of EU citizens where they are an unreasonable burden on the social assistance system. Sleeping rough is not such a burden. Similarly, barring re-entry to the UK would not be justified in such a case as it is a fundamental interference with the right to free movement.
Finally, the group of EU citizens who have been in the UK for more than three months, but are not working, seeking work or otherwise economically active. In all cases any decision to expel an EU citizen and exclude the person from re-entry must be compliant with the requirements of the EU directive 2004/38/EC. An exclusion order would need to be justified on the grounds of public policy, public security or public health. Mere rough sleeping comes nowhere near justifying exclusion on one of these bases or of being a measure that is a proportionate interference with the rights arising under the directive.
As to increasing fines on employers, this is not a matter of EU law but UK domestic law.