[Excerpt] The fraudulent contracting of work is an important issue in many European countries. This report looks at these practices across the EU and shows how the issue is tackled in the 28 EU Member States (EU28) and Norway. Applying juridical criteria, the study defines the fraudulent use of an employment or contractual relationship on the basis of two co-existing conditions, whereby:
- a specific employment or contractual arrangement is used to hire workers or to subcontract certain work activities;
- the factual circumstances of the specific employment or contractual relationship do not correspond to the legal, formal requirements for that specific form of contracting work, either directly through an employment relationship or indirectly through a subcontracting relationship.
It is difficult to distinguish in practice between the four main forms of contracting work: ‘lawful’, ‘undeclared’, ‘fraudulent’ and ‘illicit’. In many instances, such arrangements are intended to give the impression they are legitimate forms of contracting since they use legal employment or contractual relationships. However, on closer inspection, the apparent contract disguises a different employment relationship or a different employer from the contractual one. This complexity helps to explain why, in some countries (Bulgaria, Croatia, Latvia and Malta), undeclared work rather than fraudulent use of contracting work is reported as the main issue, with violations in employment contracts tending to be mostly associated with irregular jobs.
Given that the fraudulent contracting of work is particularly complex, this study focuses on a few specific contractual relationships and investigates whether there are indications that they have been abused, to what extent, and in what way. The report is based on information provided in national reports from Eurofound’s network of European correspondents across the EU28 and Norway.