The 28th Regime must Combine Innovation with Social Responsibility

The proposal from the European Commission for a 28^th Company Regime, or 'EU Inc.' can become an opportunity for innovation in Europe, only if it is accompanied by strong additional safeguards to protect workers' rights.

As the Draghi and Letta Reports made clear, fragmentation of the Single Market is a major obstacle to competitiveness. The S&D Group in the European Parliament, successfully steered an own initiative report with MEP René Repasi, leading the way in calling for an ambitious 28^th Company Regime that provides innovation and protects workers.

The position of the PES is clear: innovation must always sustain our social fabric. We need a framework that drives innovation, investment, and entrepreneurship while strengthening the Single Market for the benefit of workers and companies. Harmonisation of the Single Market must push standards up, not result in a race to the bottom on social standards or corporate responsibility. We cannot accept any loopholes that allow employers to circumvent their obligations or misuse this framework.

PES President Stefan Löfven, commented on the Commission's proposal:

"Europe needs a robust legal framework for the benefit of workers and business without cherry-picking or lowering social standards. Economic growth must respect labour laws, workers' and trade union rights, collective bargaining, workers' participation and co-determination, and employer responsibilities. To put it simply, workers must never be left behind.

The proposal by the European Commission brings some important elements on the table to establish a new truly European corporate legal framework. However, this proposal also needs significant improvements to ensure that it works to the benefit of workers.

In the upcoming negotiations, the PES will lead efforts to protect strong social safeguards. Innovation, sustainable competitiveness, and social justice must go hand in hand if we want to deliver a successful Europe."