Waste Management in Europe. Good Jobs in The Circular Economy For Web PDF

Contents
5 1. INTRODUCTION
8 2. TRENDS
8 2.1 The Public-Private Split
9 2.2 PPPS
10 2.3 Remunicipalisation
15 3. THE CIRCULAR ECONOMY

15 3.1 What is the circular economy?
16 3.2 The European Union and the circular economy
19 4. EMPLOYMENT IN THE CIRCULAR ECONOMY

19 4.1 Employment in the waste management sector
23 4.2 Job Creation in the circular economy
23 4.3 Working conditions in the circular economy
30 5. COMPANIES – THE BIG 5

30 5.1 The largest companies by size
30 5.2 Veolia
31 5.3 Suez
Waste Management in Europe. Good Jobs in the Circular Economy? 32 5.4 Remodis-Rethmann
by Vera Weghmann 33 5.5 FCC
December 2017 34 5.6 Alba
A report commissioned by EPSU
36 6. SOCIAL DIALOUGE
The Public Services International Research Unit (PSIRU) investigates the impact of privatisation and liber- 36 6.1 Structure of the industry
alisation on public services, with a specific focus on water, energy, waste management, health and social 36 6.2 European social dialogue
care sectors. Other research topics include the function and structure of public services, the strategies
of multinational companies and influence of international finance institutions on public services. PSIRU
is based in the Business Faculty, University of Greenwich, London, UK. Researchers: Prof. Steve Thomas,
39 7. CONCLUSION
Dr. Jane Lethbridge (Director), Dr. Emanuele Lobina, Prof. David Hall, Dr. Jeff Powell, Sandra Van Niekerk,
Dr. Vera Weghmann, Dr. Yuliya Yurchenko. 41 8. NOTES
1. Introduction
This report was commissioned by the European Federation of Public Service Unions (EPSU) to inform a
workshop entitled ‘the future of the waste sector in Europe: challenges and opportunities for workers’
to be held on 7th December 2017 in Brussels. The main research questions are:
· What are the EU policies towards waste management?
· What are the implications of the circular economy for the waste management sector?
· What is the public/private provision in waste management in Europe?
· Which multinational companies dominate the sector?
· What are the current collective bargaining arrangements?
· What are the opportunities and obstacles for organising waste management workers in Europe?
Approximately 2.6 billion tons of waste were produced in the EU-28 in 2014.1 Construction and mining
alone were responsible for over 60 per cent of the overall rubbish. Municipal waste is with 10 per cent
only a small proportion of the overall waste. It is, however, one of the most polluting waste.
Each inhabitant in Europe is currently producing, on average, half a tonne of household waste every
year. Only 36% of it is recycled. While the use of landfills is steadily declining almost half of the waste is
still landfilled or released into water. In some EU Member States, such as Croatia, Greece, Malta and Lat-
via, more than 80% of municipal waste is landfilled. Another big proportion is incinerated. In 20 years,
between 1995 and 2015, the amount of municipal waste incinerated in the EU-27 has risen by 99%.2
The good news is, however, that in general municipal waste generation per capita is going down. It has
dropped by 8% in a decade - from around 515 kg per capita in 2005 to 476 kg per capita in 2015.3 Yet, in
several member states, such as Denmark, Germany, Lithuania, Slovakia, Croatia and Latvia the municipal
waste generation is rising.4
Figure 1
Waste treatment methods used for waste generated in the EU-28 in 2014
Waste treatment methods used for waste generated in the EU-28 in 2014
36%
Recycling (recovery other
than energy recovery)
10%
Backfilling (use of waste in
excavated areas for slope
reclamation or landscaping) 41%
Deposit onto
or into land
5%
Incineration for energy
1%
Incineration for disposal
7%
Land treatment and
release into water bodies
Source: Eurostat, in European Parliament 2017.5
5
Source: Eurostat, in European Parliament (2017)
It is unsustainable that large amount of materials are buried, dumped out at sea or turned into ash,
polluting the environment and creating the need for the extraction of further raw materials.
The circular economy promises to overcome that. Instead of disposing materials that are no longer
useful, it aims to re-use the existing resources. The trend is to see waste no longer as a problem but as
a resource. Hence, the circular economy has not only become a popular policy tool but also a lucrative
business opportunity for multinational companies. Companies can profit twice: by disposing the waste
and by re-selling it for further re-use. Treating waste as wealth translates into a scramble for resources
in the waste sector.
While the circular economy provides an opportunity to make Europe more sustainable it also bears
the danger of stimulating the creation of ever more, rather than less, waste. Re-use and recycling provide
the perfect excuses to stimulate consumption. However, the European Circular Economy agenda not only
includes proposals for recycling, repair and re-use. It also emphasises waste reduction. But the measures
to prevent waste are very limited and usually do not go beyond consumer education.6
Europe’s transition into a circular economy will significantly change the labour market. The circular
economy has implications that go well beyond the traditional waste sector. It promises the creation of
green jobs. But the conditions of these jobs are seldom discussed. The European circular economy pack-
age lacks concrete proposals to protect workers in the circular economy from low-skilled and low-wage
employment and poor health and safety standards.
Against this backdrop this report examines the waste management sector in Europe in 2017 including
recent policies concerning the transition towards a circular economy. It covers the following issues:
· An overview of the waste management sector in Europe;
· The main trends affecting waste management in Europe;
· Maps the circular economy and portrays its implications on waste management;
· An analysis of the business strategies of the biggest companies dominating the waste sector in
Europe;
· The main stakeholders in the waste sector in Europe;
· The obstacles and opportunities of the circular economy for workers; and
· An overview of exciting social bargaining avenues.
6 Waste Management in Europe. Good Jobs in the Circular Economy?

household billing. Its profit margin was 20% which is very high. Simultaneously a public run company,
Salubrita, run municipal waste collection services for the rest of the population. Salubrita is self-financing
and also has a positive cashflow. Its charges were significantly lower and it reinvested all its profits into
the municipality.13 This shows that the private sector was not more efficient than the public sector. In
fact, this case demonstrates the opposite.
Often efficiency and saving costs are treated as synonyms but they are fundamentally different.
Lower costs can simply mean a lower service or worse conditions for the workers delivering these ser-
2. Trends vices. Hence, it is important not to confuse the two. The PSIRU report on efficiency in 2012 therefore
argued that: “Public and private provision must be compared for their effectiveness in delivering these
public goods, not just their cost-efficiency”.14 Research in Germany and Sweden also suggests that the
2.1 The Public-Private Split waste services delivered by public entities is of higher quality than if delivered by private companies.15
Moreover, Sardinia in Southern Italy shows what public waste management can achieve. Sardinia has
Public authorities carry the main responsibility for the municipal waste management. The services are reduced its waste generation by 16% (143 724 tonnes) over a span of just nine years (Graph 1). It has a
either delivered directly through the municipal departments or through municipally owned waste man- door-to-door separate collection system, where the municipalities themselves are held accountable and
agement companies, or indirectly through outsourcing to private providers.7 are either punished or rewarded for the amount of waste they bear. Waste management in Sardinia is
All EU Member States employ a combination of direct and indirect waste service delivery. However, a currently undergoing a transformation with municipal waste companies being grouped together into
few country specific tendencies can be identified. For example, the collection and transport of municipal larger organisations.
waste management the direct service delivery or through a municipally owned management company
is common in Germany and Italy. In Germany a further trend towards public ownership can be observed
in recent years as more and more local authorities municipalized their waste collection services (see sec- Graph 1
tion 2.3). In Poland, Romania, Spain, Sweden and the United Kingdom outsourcing the collection and Record
Graph 1:ofRecord
the production of municipal
of the production waste in waste
of municipal Sardinia
in Sardinia
transport of municipal waste to a private provider is far more common.8 In the treatment and disposal (figures expressed in tonnes/year)
phase of municipal waste management Italy, Germany and Sweden have a slightly higher share of direct
delivery in comparison to outsourced services. In Poland, Romania, Spain and the United Kingdom these 2006 860 966 tn
services were mostly subcontracted to private companies.9 2007 862 452 tn
In general, private participation was more prevalent in the collection and transport phase than in the
treatment phase. The public-private split in the organisation of the waste sector can also be found in the 2008 846 664 tn
table (Table 1) below.
Contrary to the commonly held assumption that privatization increases efficiency, several economet- 2009 837 356 tn
ric and empirical studies on efficiency and privatisation in waste management have found no systematic
2010 825 125 tn
evidence to support a difference in costs between public and private provision. An overview of the differ-
ent international and national studies on waste management that show that public waste management 2011 794 935 tn
either performed as well as or better than private waste management can be found in a PSIRU report
on public and private sector efficiency.11 For example, a study that reviewed 27 empirical studies on 2012 754 896 tn
comparative efficiency in waste and water management in various countries came to the conclusion that
“private production of local services is not systematically less costly than that of public production”.12 This 2013 732 668 tn
can be illustrated on the case of Targoviste in Romania. In 1994 Prescom a private waste management 2014 725 027 tn
contractor started to provide services to about 80% of Targoviste’s population and five neighbouring
communes. In 2004 the annual revenue of the company was €20m, of which three quarters came from 2015 717 242 tn
Source: Zero Waste Europe 2017.16
Table 1 Source: Zero Waste Europe 2017
Estimated share of services provided by type of provider
in the selected Member States 2.2 Public Private Partnerships
Member State (year) Private Public Mixed Direct private management, where the public authority places the whole responsibility and execution
Germany (2012/2013) 50% 45% 5% of service delivery in the hands of the private party, is not common in the waste sector in Europe.17 Far
Italy (2016) 27% 55% 18% more common are public private partnerships (PPP). A PPP is a contract between government and a pri-
Poland N/A N/A N/A vate company under which a private company finances, builds, and operates some element of a public
Romania (2012) 53,7% 46,3% N/A service; and gets paid over a number of years, either through charges paid by users (often called a con-
Spain (2014) Collection: 80%* Collection: 20%* Collection: N/A (low) cession), or by payments from the public authority, or a combination of both.18
Treatment: 80%* Treatment: 20%* Treatment: N/A (low) Since the 1980s and 1990s many European countries underwent a process of privatisation of waste
Sweden (2015) Collection: 71% Collection: 25% 4% management services. This was in line with the adoption of neoliberal policies, which assumed that
Treatment: ~10% Treatment: ~90%33 market forces and competition will lead to efficiency, innovation and growth and that the government
UK (2015) Collection: 40% Collection: 60% Collection: N/A (low) should, therefore, intervene as little as possible. At EU level, the adoption of procurement legislation has
Treatment: ~<90% Treatment: >10% Treatment: N/A (low) further affected direct public services and obliged public authorities to follow a procedural framework
Source: Ramboll Management Consulting in European Commission 2016.
when carrying out privatization. Additionally, mounting pressure on public finances has led to the popu-
Note: The data presented in the table is not fully comparable across the countries as they refer to different time periods. larity of PPPs.19 This is because investments through PPPs can be recorded off the government’s balance
*Based on market revenues. No data available on the share of public, private and mixed providers sheets. In other words, officially PPPs do not have a direct impact on government debts, even though in
8 Waste Management in Europe. Good Jobs in the Circular Economy? 9

reality the government is still paying for the investment through taxation.20 As such while money is still
borrowed it “allows governments to invest while complying with the debt and deficit thresholds estab-
lished in the Maastricht Treaty”.21 This is very significant as, in theory, countries can be fined for not com-
3 country case studies of countries with a high private
plying with the Excessive Deficit Procedure (EDP).22 Even though, to date no country has ever been fined. sector involvement in waste services:
Despite the accounting benefits the number and value of PPPs in Europe have gone down (see Graph
2). In 2012 PPPs had the lowest value in 10 years, with 66 new deals worth €11.7 billion. PPPs rose in The United Kingdom
2013 but then collapsed in 2014 and 2015. In contrast to the overall decrease, the environment sector in The UK is the largest and growing PPP market in Europe, contrasting the declining trend in Europe (see
Europe saw a steep increase in PPPs in value terms. This was largely the result of a few large waste treat- Graph 2). In terms of value PPPs increased from a total of €2.4 billion in 2015 to €3.8 billion in 2016.
ment deals in the UK. In 2015 the PPPs had a value of €374 million in the environmental sector which PPP projects almost duplicated within a year, while there were 15 project deals in 2015, there were 28
Graph
increased 2:tototal valueinof
1.2 billion PPP
2016. 23 projects in the EU, Mn Euro
As such, while PPPs in other sectors, especially in transport, are going deals recorded in 2016.26 In times of austerity the government is constrained from borrowing more.
down PPPs in the environmental sector are going up. In 2016 the total value of the PPPs declined further PPPs are, therefore, a way to build infrastructure while keeping the recorded government spending low.
by 22 per cent in comparison to 2015.24 However, the increase of PPPs poses a severe financial burden on the government. Since the crisis, pri-
vate borrowing has become much more expensive and the average cost of PPP finance is double that of
government bonds.27 It is estimated that PPP finance paying an interest rate of 8% is significantly larger
Graph 2 than through direct government bonds which has a rate of 4%. As such, PPPs are a very expensive way
Total value of PPP projects in the EU, Mn Euro to provide public services. Moreover, within many of the PPPs major problems have occurred. In the UK,
17.7% of the contracts (as a percentage of investment) have been bought out, terminated or faced major
25 000
problems, costing the government millions of pounds. Regarding the waste sector, the problems with
PPPs can be demonstrated in Sheffield and in Manchester. In 2017 both municipalities made the decision
20 000
to terminate waste service PPPs. In Sheffield, the council voted in January for an early end of the city’s
35 year contract with Veolia, which was agreed in 2001 and due to expire in 2036.28 For the council the
15 000 contract which was signed 16 years ago was no longer perceived to meet the city’s needs. Additionally,
the GMB union discovered that Veolia diverted recyclable waste to its waste to energy to incinerators.29
10 000 This not only increased pollution and prevented Sheffield from meeting its recycling targets but also the
workers missed out on the bonuses they would have received if recycling targets were met. However,
5 000
due to very high compensation costs the council would need to pay to Veolia it is not yet clear if the
contract will actually be terminated.30 In Manchester the Greater Manchester Waste Disposal Authority
terminated a contract with Vividor Ltd in September 2017 due to frustration with failures in repair work
and a dissatisfaction with its value for money. Yet, the city had to pay a lot to end this contract as it took
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
over all outstanding loans from the company.31
Spain
SOCIAL AND DEFENCE TELECOM TRANSPORT WASTE AND WATER Research indicates that there is a high share of outsourcing in the provision of municipal waste manage-
Defence, education, government Airports, bridges, railways, Water and sewages, waste. ment services. In recent years the market share of private companies has further increased by 4,5%.32
buildings, hospitals, prisons, urban railways, roads, This indicates a trend to even further privatisation. Moreover, the waste sector shows a strong concen-
police, recreation facilities tunnels
tration with five companies having more than 70% of total market revenues.33 Abuses of their dominant
market positions have been identified by the European Commission. Their recent report on corruption in
Source: Dealogic Projectware database, extraction 07/12/2015 in Tomasi 2016. 25
Note: Social and Defence: defence, education, government buildings, hospitals, prisons, police, recreation facilities; Transport: the EU found that the waste sector is one of the sectors that is most affected by corruption. Two of the
Source:Waste
airports, bridges, railways, urban railways, roads, tunnels; Dealogic
andProjectware database,
Water: water extraction
and sewages, 07/12/2015 in Tomasi 2016
waste. most famous examples reported were the Cloaca Operation and the Brugal Operation in Spain. In both
cases the accusations were of crimes as prevarication, bribery, fraud, concealment and influence ped-
dling by the alleged payment of commissions for the award of contracts related to waste management.34
The implications of PPPs for workers are best assessed on a case by case basis. However, generally These example confirm Hall’s findings that due to its long term concessions PPPs are incentives for cor-
speaking PPPs worsen employment conditions for workers. David Hall (2015) identified five reasons why ruption.35 They are a one-off opportunity for private companies to win a stream of government-backed
this is the case: 1) The private company has a greater incentive to reduce employment in order to increase revenue lasting for several decades.
profit margins; 2) As workers usually lose their status as public employees this could mean that workers
lose public sector pension schemes; 3) Private employers may provide worse employment conditions for Poland
new entrants compared with transferred workers, which leads to a ‘two-tier’ workforce 4) The division In Poland an increased privatisation in the waste sector has been registered. A stark increase of priva-
of workers into smaller units weakens trade union organization; 5) The PPPs might impact other public tisation in the municipal waste sector was identified before 2013. In this wave of privatisation public
service workers as PPPs are more expensive and thus create the need for budget cuts and potentially the companies became either fully privatised or mixed joint ventures with private suppliers. This is because,
cutting of staff costs elsewhere.39 until recently, the Polish law prohibited the use of in-house arrangements from public procurement in
the waste sector and instead mandated the outsourcing of services. However, as this law has recently
2.3 Remunicipalisation been changed to allow in-house provision, a trend towards public service provision is anticipated.36 In the
period between 2010 and 2014 non-domestic private providers (Remondis, Sita, Veolia, Alba) owned
Despite the increased private sector involvement in some European countries in recent years, a converse over 40% in market value (in annual terms).37 Like in Spain also in Poland companies have abused their
trend can also be observed. However, while some re-municipalisation cases have been recorded in the dominant market position. For example an investigation of the Office of Competition and Consumer
UK, France and Spain this trend is mostly restricted to Germany. In Germany there was a trend to pri- Protection (UOKiK) in 2013 showed that the company Chemeko-System in Wroclaw - the owner of the
vatize waste collection from the mid-1980s onwards but this trend was reversed in the beginning of the only installation for the processing of municipal waste in the region - used its monopoly position in the
21st century. Similar to the energy sector Germany experienced a wave of re-municipalisation in waste local market to unjustifiably raise prices. The price increase was nearly 115%.38
management.

Unfortunately, the data about the re-municipalisation processes in the waste collection in Germany, ing re-municipalisation cases in Germany and Austria across different sectors, Terzic finds that in most
which is collected by the federal office of statistics in Germany, has severe limitations. As in this data set cases re-municipalisation led to improved working conditions. Working conditions especially enhanced
PPPs with a majority of public ownership are included in the figure on public enterprises. A more precise for workers who were struggling with low wages and temporary contracts.49
analysis of the re-municipalisation processes can be based on the data collected by the multinational
waste company Remondis about the waste providers in Germany in 2003, 2009 and 2015.40
Graph 4
Development of consumer prices and the development of consumer prices
Graph 4: Development of consumer prices and the development of consumer prices f
Graph 3 Percentage of municipal and PPP waste collection in Germany
Graph 3: for waste collection
Percentage of municipal and PPP waste collection in Germany
50 108
Overall consumer prices
Public waste 106 Consumer prices for waste collection
collection
104
provision
40
102
100
98
30
96 Price index
2010=100
94
20 92
90
88
PPP
10
86
84
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
2003 2009 2015 Source: Federal Office of Statistics, statistic of consumer prices. Graph E.CA Economics.47
Source: Federal Office of Statistics, statistic of consumer prices. Graph E.CA Economics.
Source: ECA Economics based on Remondis data.41
Source: ECA Economics based on Remondis data.
As graph 3 above shows, 36 % of all municipalities provided their own residual waste collection in 2003.
In 2015 this increased by 10 per cent to almost 46%. Simultaneously, a decrease of PPPs can be observed
since 2009. This trend towards increased re-municipalisation has taken place in all federal states (apart
from the city states Berlin and Hamburg which had a municipal residual waste collection from the begin-
ning and Bremen where the residual waste services are performed through a PPP). However, municipal
waste collection is especially prominent in cities with more than 100 000 inhabitants - in 92 % of them
the municipality is in charge of the rubbish collection.42 Increasingly also rural areas are re-municipalising
the waste collection services.43 A report by the European Commission found that in Germany also 31%
of the waste treatment activities and 4 % of the waste recovery activities were provided by the munic-
ipalities in 2016.44
There are several motives for why cities and regions decided to take back their waste services under
public ownership. The need for flexibility and control over the delivery of services were the main reasons.
Further reasons for the re-municipalisation processes were cost-benefit advantages, the aim to reduce
public spending, the securing of jobs for local authorities and the expiry of contracts with private provid-
ers. In terms of the latter, it is very common for re-municipalisation processes to coincide with the expiry
of contracts as the early termination of contracts with private providers can be very expensive.45
The trend of the re-municiplisation of waste collection services in Germany had a positive impact on
the price development. While the prices for waste collection rose dramatically after many municipalities
privatized their waste collection and increased even more than the overall consumer prices, since 2007,
consumer prices for waste collection stagnated and the overall consumer prices grew significantly faster.
As such the stagnating consumer prices coincide with the increased re-municipalisation of waste collec-
tion services.46
To date there is no extensive study examining the impact of re-municipalisation on working condi-
tions. While there is the opportunity to improve the working conditions for those carrying out public
services, assessments can only be made on a case by case basis, as several factors influence the agency of
local authorities. Not least it depends on the economic situation of the municipality.48 Yet, when assess-

3. The Circular Economy
3.1 Towards the Circular Economy
The circular economy is an alternative to a traditional linear economy (make, use, dispose) in which re-
sources are kept in use for as long as possible, extracting the maximum value from them whilst in use,
then recovering and regenerating products and materials at the end of each service life.50
Figure 2
The Circular
Figure 2: TheEconomy
Circular Economy
Y
ERG
EN
PRODUCTION
AND DISTRIBUTION
TE, REFUR
RIBU BIS
ECO-DESIGN ST
H,
I
ED
RE
, REPAIR, R
MAN
UFACTU
Technica
CONSUMPTION
Biolo g
USE
AND STOCK
RE
ic al
E
l ma
R
ma
ter
ter
ial
ial
s
s
R E C Y C LI N G WASTE
MATERIALS
EMISSIONS
MINIMIZE
EXTRACTION AND IMPORT OF NATURAL INCINERATION LANDFILL

RESOURCES, INCLUDING ENERGY CARRIERS
Source: EEA, 2015

Source: EEA, 2015
The circular economy aims to fundamentally change how we think about waste: treating it as a A key challenge for the transition to the circular economy will be how the EU member states integrate
resource rather than something we just want to get rid of. Environmental organisations argue that the the waste management approach set out by the EC. Therefore, the EC will together with the European
circular economy bears the potential for us to live resource efficient while enjoying a “low-carbon pros- Environment Agency (EEA) monitor the implementation of the circular economy in member states.60
perity”. A clean production and sustainable consumption contributes to saving the planet.51 It is noteworthy, that in the EC’s vision for a circular economy PPPs play a pivotal role. Already in the
The world’s leading multinational companies in the waste management sector (see section 5.2-5.6) earlier 2014 programme for the circular economy the EC promoted PPPs as “effective instruments for
are also very enthusiastic about the circular economy but for very different reasons. In the circular econo- levering private action and investment in resource efficiency”.61 Also in the 2015 action plan for the
my the companies can profit twice from the same material: for disposing it and for selling it as a resource circular economy the EC pledged to “actively engage stakeholders in the implementation of this action
to producers. The circular economy also bears an opportunity for companies to reinforce their market plan, in particular through existing sectorial platforms. This will be complemented by further support for
position. The companies argue that due to their long experience and expertise it is only them who can public private partnerships…”.62
successfully deliver in a circular economy, as the municipalities do not reach this standard.52 This is espe- Considered in the context of the ECs overall active promotion of PPPs, it is not surprising that it sees
cially important in light of the threat of re-municipalisation (see section 2.3). Suez, for example, rebrands PPPs as key to the success of the circular economy. Also in 2015 the EC launched together with the Eu-
itself as heading the “resource revolution”53 and regularly pays for articles in the Guardian that promote ropean Investment Bank (EIB) an investment plan for Europe in which PPPs are regarded to be pivotal
the circular economy.54 Moreover, we see that the circular economy also was promoted by World Eco- for getting Europe’s infrastructure back on track after the economic crisis. Moreover, given the overall
nomic Forum (WEF). The WEF is an annual event which has a significant global policy- setting influence. decline of PPPs in Europe (see section 2.2) an active outreach campaign was launched by the EC, the EIB
Every January at the ski resort of Davos, in Switzerland, international corporations and consultants meet and the European PPP Expertise Centre (EPEC), which informs member states about accounting rules and
with governments and international organisations to develop and promote policy recommendations. especially the importance of PPPs in the Excessive Debt Procedure (EDP). As outlined in section 2.2 PPPs
That the circular economy is promoted by the WEF demonstrates the increasing business interests in can be recorded of the governments’ balance sheets.
waste as a resource.
Social benefits cannot be assumed to magically appear through the circular economy. Unless demo-
cratic change is at the heart of the circular economy, it is expected to mainly benefit large multinational
companies. It is, therefore, important that labour requirements are integrated into the circular economy
by respecting collective bargaining agreements, social security entitlements and tax contributions. While
the circular economy has the potential of job creation good working conditions need to be ensured and
the transition for workers must be managed.
3.2 The EU and the Circular Economy
In 2014 the European Commission (EC) published a report entitled “Towards a circular economy:
A zero waste programme for Europe”. In this document it proposed that “the EU and the Member
States should encourage investment in circular economy innovation and its take-up”.55 However,
just half a year later the proposals on the circular economy were eliminated as part of the drive to
cut red tape.56 A revised circular economy package was published by the European Commission a
year later. The new document entitled “Circular Economy closing the Loop – An EU Action Plan
for the Circular Economy” sets out the new policies on the circular economy.57 While the EC ar-
gued that the new package would be more ambitious it was, in fact, the opposite. A comparison
between the two policy packages shows that the 2015 outline of the circular economy will create
110 000 less jobs.58
Nonetheless, the EC’s action plan for the circular economy still has an ambitious aim: to treat waste
as a resource and to turn Europe into a circular economy. While the suggested policies go far beyond
the waste sector, waste sector management plays a key role in the transition to a circular economy. As
such, the EC’s 2015 action for a circular economy sets the current scene for a new approach to waste
management in Europe.
Changes on the following legislations were proposed by the EC in order to turn Europe into a circular
economy:
1. Directive 2008/98/EC on waste
2. Directive 1999/31/EC on the landfill of waste
3. Directive 94/62/EC on packaging and packaging waste
4. Directives 2000/53/EC on end-of-life vehicles, 2006/66/EC on batteries and accumulators and
waste batteries and accumulators, 2012/19/EU on waste electrical and electronic equipment
(WEEE)
The action plan proposes three specific changes to the regulations by including the following targets by
2030:
· A binding landfill target to reduce landfill to a maximum of 10 per cent of municipal waste;
· A target to prepare 65 per cent of municipal waste for re-use and recycling;
· A target to prepare 75 per cent of packaging waste for re-use and recycling by 2030 (with
supplementary targets for specific packaging material).
In total the EU is dedicated to spend €5.5 billion on the current waste financing programme through
the European Regional Development Fund (ERDF) and the Cohesion Fund in the period between 2014
and 2020.59

4. Employment in the Circular Economy
4.1 Employment in the waste management sector
There is a lack of employment statistics in the waste sector. Figures also vary, depending on the source
of the data. This is because there is no consistent definition of which activities are included in the waste
sector. But there is a general consensus that employment in the waste sector is rising. According to Eu-
rostat there were 0.8 million employees (full-time equivalents) in waste management in 2000. By 2014
the number of employees increased to 1.1 million full-time equivalents. In other words, there was a 36%
increase in employment.63
While Eurostat does not provide data for each waste management activity it is possible to roughly
distinguish between different waste management phases. The two graphs (Graph 5 and Graph 6) below
Graph 5
European Union (27 countries) Number of persons employed; Waste collection,
Graph 5: European Union (27 countries) Number of persons employed;
treatment and disposal activities; materials recovery; Total
Waste collection, treatment and disposal activities; materials recovery; Total
828 800
830 000
820 000
795 100
810 000
800 000
790 000
760 000
780 000
755 228
770 000
760 000
734 300
733 800
729 600
2006 2007 2008 2009 2010 2011 2012
Source: Eurostat.64
Source: Eurostat

Graph 6 Table 2
European Union (28Union
Graph 6: European countries) Number Number
(28 countries) of personsof employed; Waste collection,
persons employed; Employment in Waste collection, treatment and disposal activities;
treatment and disposal
Waste collection, activities;
treatment materials
and disposal recovery;
activities; Total recovery; Total
materials materials recovery by country
Country 2012 2013 2014 2015*

EU 28 840 013 853 722 881 068 913 981
914 320
Austria 13 209 13 803 14 804 14 908
908 406
Belgium 15 476 15 212 15 648 11 990
920 000
Bosnia-Herzegovina 5 483 5 591 5 772 5 627
899 073
Bulgaria 15 974 15 796 15 655 14 460
910 000
890 133
Croatia 10 094 10 431 11 709 12 318
900 000
Cyprus 728 830 / /
881 094
Czech Republic 32 114 33 008 33 126 32 496
Denmark 6 448 5 858 6 113 8 922
873 528
890 000
Estonia 1 951 1 896 1 837 1 787
866 834
880 000
Finland 5 695 5 831 5 964 6 086
860 293
France 95 793 99 050 97 511 106 663
Germany 118 267 123 490 126 403 145 460
853 752
870 000
Greece / / / /
849 400
843 235
Hungary 17 298 17 338 15 135 16 076

843 108
860 000
839 981
Ireland 6 382 6 406 6 342 6 498

850 000 Italy 134 456 136 788 135 577 137 514
Latvia 3 640 3 916 4 115 4 145
840 000 Lithuania 6 147 6 596 6 739 6 899
Luxembourg 1 024 1 019 1 035 1 072
830 000 Malta 483 403 537 /
Netherlands 26 299 26 073 21 831 22 213
Octuber 2012 April July October 2013 April July October 2014 April July October 2015 Norway 6 912 6 849 6 944 7 177
Poland 55 892 5 7413 58 645 60 767
Source: Eurostat.65 Portugal 15 504 15 084 14 901 14 514
Source: Eurostat
Romania 48 232 49 604 48 829 46 962
Slovakia 9 515 9 251 9 588 9 097
show that when looking at waste collection, waste treatment and disposal as well as material recovery a Slovenia 5 143 5 238 5 169 5 092
steady growth of employment can be identified in the EU from 2010 onwards. Spain 69 297 75 448 104 607 104 036
However, when comparing the countries it becomes obvious that employment in the waste sector is Sweden 15 409 15 563 15 622 16 067
concentrated in a few EU countries. The five biggest waste sector employers are Germany, Italy, France, Switzerland 8 490 9 204 9 481 9 818
Spain and the United Kingdom which together cover over 65 percent of the employment in the waste United Kingdom 109 855 104 097 102 787 105 820
sector of the whole EU 28 (Table 2).
Source: Eurostat, NACE Rev. 2, B-E
Moreover, when comparing the main phases in waste management, namely waste collection, waste *Note: Data for 2015 is not available for all countries, for some countries and also for the EU28 numbers the data is of the end
treatment and disposal, and material recovery, it becomes obvious that a big proportion of the workers of November 2014.
in the waste sector are occupied in waste collection (see Graph 7). Over half (56%) of the employment
in waste collection, treatment, disposal and material recovery is in waste collection.
Far fewer jobs are found in material recovery (see Graph 7). Previous research on employment in the EU 28 countries. By the end of 2014 only 2 500 more people were employed in the sector in the EU28
recycling sector has been very optimistic. Looking at the available data from Eurostat for recycling and countries. This equates to a 1.3% increase in nearly 2 years. These figures are especially important, when
the wholesale from waste and scrap Fisher et al. (2011) find that there was a 70 % increase in employ- considering that the expected job creation through the move towards a circular economy is, next to jobs
ment in the recycling sector between 2000 and 2007.66 This research is frequently cited and also used in in the re-use and repair sector, also based on an expected employment growth in recycling sector (see
recent studies as evidence for the employment growth in the recycling sector which equates to an annual section 4.2).
job increase of 8 % between 2000 and 2007.67 68 However, not included in these figures are the people working in the informal recovery sector. As sec-
An assessment of the current employment situation in the recycling sector has been impeded by tion 4.3.2 shows it is estimated that up to one million people could be occupied in the informal recycling
a change in the classification of the available data. Before 2007 Eurostat recorded data for recycling and re-use sector.
(NACE Rev. 1.1 37) and the wholesale of scrap (NACE Rev. 1.1 51.57). From 2008 onwards it covered Conversely, to the job increases in waste management, employment decreased in waste water man-
data for material recovery (NACE Rev. 2 38.3). Other relevant activities for recycling, such as for example agement. Between 2000 and 2014 employment decreased by 63 000 (full time equivalent, falling to
the collection of recyclables are classified together with other activities. It is therefore difficult to assess 586 000 (full-time equivalents) in 2014. In other words, employment in waste water management de-
employment in the recycling sector in isolation. creased by 10 per cent in this period.71 When looking at employment in sewerage in the EU 28 it be-
When looking at the figures of material recovery in recent years only the employment outlook in the comes clear that while employment has been rising since 2012 and peaked in December 2014, it sharply
recycling sector becomes much less optimistic. While the recycled amount of waste has grown between decreased since then (see Graph 8).
2010 and 2014 by 27 million tonnes or 7% resulting in an increase of the recycling rate from 53% to Looking beyond waste management at the circular economy it becomes even more difficult to measure
55%,69 there is little evidence of an increased employment growth in the material recovery phase of employment. This is because any estimate depends on which sectors are included in the circular economy.
waste management. In January 2013 there were 190 222 people employed in material recovery in the A report by WRAP estimated that 3.38 million people were employed in the circular economy in 2015.73

Graph 7: Number of persons employed in the waste management sector
per waste management phase (2014)
Graph 7 Figure 5
Number of persons employed in the waste management sector Estimates of jobs in circular economy activities across Europe in 201574
per waste management phase (2014)
Germany
73 057
41 960
30 202
11
98
Spain WASTE
69 848 COLLECTION EUROPEAN
25 262
8 685 UNION
512 498
(27 countries)
Italy
92 324
19 274
25 962 WASTE
TREATMENT
Poland
40 065 & DISPOSAL 205 201
10 393
10 210 3.4 Million
MATERIALS RECOVERY
jobs in circular
640
Romania
31 250 189 268 economy
693
2 301 activities in
13 350
Europe
Sweden
9 594
1 576
4 908 Rental & leasing activities 6
United Kingdom 12
8
47 646 Retails of second hand goods store 1
14
39
32 417
26 422 4
16
Wholesale of waste & scrap
Recovery of sorted materials

Source: Ramboll Management Consulting based on Eurostat in European Commission 2016. 70
Repair of computers, personal equipment
Source: Ramboll Management Consulting based on Eurostat in European Commission 2016.
and other household goods
Waste collection, treatment and disposal
Graph 8: Number of persons employed in sewerage in EU 28
Repair of machinery & equipment
Source: Eurostat, WRAP calculations
Graph 8
Number of persons employed in sewerage in EU 28 Source: Eurostat, WRAP calculations
4. 2 Job Creation
155 000 154 295 The circular economy has the potential to create jobs because re-use and recycling are more labour
154 000
intensive than disposal. In this way, the circular economy agenda feeds into the European Commission
2020 Strategy for smart, sustainable and inclusive growth, which sets a target of 75 per cent of 20 to 64
152 000 year olds to be in employment by 2020.75 To achieve this target 17.6 million additional jobs are needed.
Broadly four different categories can be identified when looking at employment in the circular econ-
151 000
omy, namely waste, recycling and wholesale of waste; repair work retail of second hand goods; and
149 000 renting and leasing.76
Current circular economy activities are estimated to create more than 1 million new jobs across the
148 000 EU-28 by 2030, and with further advancements in the circular economy even up to 3 million jobs could
147 000
be achieved by 2030.77 However, these jobs are likely to be created in countries in which waste sector
employment is already strong, namely Germany, the UK, Italy France and Spain (see Figure 6). Almost
146 000 half of these new jobs are expected to be created in Germany and in the UK alone. Nonetheless, it is
estimated that most European countries will benefit to some extend from the job creation through the
145 000
circular economy.78
144 000 However, in the enthusiasm about job creation the discussions of the conditions and the pay of these
jobs are often side lined. To date not much has been written about the quality of these jobs and what
143 000 the transition to a circular economy means for skill changes and job relocation.
142 000
4.3 Mapping Working Conditions in the Circular Economy
Octuber 2012 April July October 2013 April July October 2014 April July October 2015
Employment conditions in the circular economy are a highly under-researched topic. Yet, existing re-
Source: Eurostat.72 search comes to optimistic conclusions. A report done by the green alliance on employment in the circu-
Source: Eurostat

Figure 6 are lower paid occupations.81 This is very high even for the UK standard, where one quarter of all em-
Potential jobs in Europe
Figure 6: Potential jobs increated
Europethrough
created expansion
through expansion ployees is paid less than a living wage.82 In 2016 most of the unskilled workers were only paid the living
in circular
in circular economy
economy activity
activity to
to 2030
2030 (gross jobs estimates by country are in thousands) wage or below.83
Developments in the circular economy not only involve major industry transformations but it also pos-
es new challenges and opportunities for trade union organising. To stimulate the discussion on the role
Austria
of trade unions in the circular economy the sections below will provide a snapshot of the employment
m
conditions within the circular economy. Further research on the employment conditions in the circular
giu
Po
Bel
economy is highly recommended.
lan
25
d
29 19 ia
an 4.3.1 The recycling sector
m
Ro
Sw
ed
en A closer look at the working conditions in the recycling sector reveals the dark side of the circular econ-
ania
30 omy. The research on the circular economy to date has largely ignored the recycling labour in the global
Lithu
Slo
North. The emphasis is on green job creation but little attention has been paid to the condition of these
va
tia gal
kia
oa Portu jobs. Statistical data on the workforce in the circular economy is lacking too. However, pioneering re-
Cr
search on the working conditions in the Material Recovery Facilities (MRF) for municipal solid waste (also
called dry recyclables) in Belgium and the UK showed that it is ‘hard, dirty, manufacturing work – the
Netherlands
Greece kind of low paid assembly-line working that largely disappeared from Northern and Western Europe
36 Cypru Latvia
s
Finland with the flight of manufacturing capital to Asia’.84 The workers in the picking cabin are often working
beyond eight hours a day, with very few breaks. The work environment is very noisy, smelly and the work
a M monotonous. People are working in a confined space and with the belt running at a high speed. Their
ni alt
to a research also suggests that most of the workers at the MRF cabin process are mostly migrants. Typically
ia Es
Luxembou
ven
Slo De the pay is the minimum wage.
nm
ark Similar conditions are found in a textile recycling plant in the UK, where clothes are sorted by type and
40
then by wear from the belt. Some clothes are destined for re-sell in different parts of the world, some
rg
ria
blic material will be recovered for industrial rags or fibre reclamation. The research conducted by Botticello,
epu
lga
Hu
R
Bu
ech Calestani, Crang (2016) in a recycling plant in the UK found that most workers are women, all of them
Ireland
ng
Cz
ary
migrants mostly from Eastern Europe, as this is where many of the clothes will be exported to85. The
work is physically demanding, as it involves a lot of standing and the belts are moving fast. The work
81 environment is smelly and dusty. Consequently the workers often suffer from dust allergies, runny noses
328
and excessive sneezing. In order to feel the material the workers are not using gloves, which often causes
skin irritations.
ain
Ge
Sp
rm
135 an
4.3.2 The informal recycling and re-use sector
y
210
154
ce
Additionally, there is a significant amount of informal recycling taking place especially in Eastern and
Fran
Uni
Southern Europe but also in Northern European Countries, for example through bottle collectors in Ger-
Italy
ted
many and Denmark. Informal recyclers make a living by the extraction of discarded items from disposal
Kin
sites, streets, containers and sometimes directly from generators. They then sell the collected materials
gdo
to the value chains. Usually these informal waste management activities are associated with the global
m
South. For example, in Latin America alone 4 million people are estimated to make a living through the
collection, the transport and the sorting of recyclable products.86 According to UN Habitat it is assumed
Continuation of current 1.2 Million jobs Unemployment that 25%-50% of all recyclable waste in Latin America and the Caribbean is recycled by informal waste
development in circular created across reduced by pickers.87
economy to
2030 Europe 250 000 The contribution of the informal sector to recycling is completely sidelined in the European circular
economy agenda.88 However, a number of studies have shown that informal recyclers in Europe have
Source: WRAP calculations kept many tons of waste out of landfills.89 While there is very little research done about the informal
waste economy in Europe and there are obvious difficulties in attaining reliable data, initial research sug-
Source: WRAP calculations gests that there could be as many as one million active re-users and recyclers in Europe.90 So, on the one
lar economy uses data from the UK only to argue that ‘circular economy jobs are good jobs’ as ‘a more hand, these informal recyclers make a significant contribution to the circular economy. As for example
circular economy could improve job security and satisfaction across Europe by providing thousands of a recent study found that a considerable amount of used beverage cans are collected by waste-pickers,
high quality, long lasting jobs in remanufacturing, repair, servisation, recycling and circular bio-economy particularly in countries like Romania, Greece and Hungary. The study estimates that each individual
activities’.79 informal collector amasses an average of 1.6 kg of used beverage cans per day.91 On the other hand,
It thus presents a rather positive picture of the employment conditions in the circular economy in however, the earnings of the informal recyclers are often surpassing the minimum wage, as they are not
Europe, based on the UK example. It finds that when compared to the overall economy: workers in the receiving a wage but survive on the little money they make by selling the material. They are also exposed
circular economy are less likely to be underemployed, employment is more stable, it creates opportunities to greater health and safety risks as they are working without protective clothing. This informal recycling
where unemployment is high, and it has the potential of job creation for skilled and unskilled jobs. It is mostly performed by vulnerable people. Scheinberg et al. (2016) find that most informal waste pickers
especially emphasizes the job creation of low skilled – and low paid – jobs. This, so the report argues, is in Europe are usually of Roma ethnicity; or migrants or refugees often without formal identity papers;
significant as in the UK unskilled work is in decline.80 In the UK 41% of the jobs in waste and recycling and/or are young or elderly people; and/or homeless.92

Throughout various phases of waste management, such as street cleaning, refuse collection, recycling
Unionising in the informal economy in Serbia and disposal workers are exposed to serious risks. These health and safety risks are linked to a) the nature
of the waste, as workers are exposed to hazardous materials, chemicals substances, different vapours,
It is assumed that 35 000 and 50 000 informal collectors work in Serbia. These figures are not represent- smoke, fumes and dust and may also handle infectious materials; b) the work process, as workers are
ed in official statistics. Most of the waste pickers are of Roma origin.93 often affected by a lot of noise, stark vibration, heavy lifting and monotonous handling and c) work or-
In 2011, 350 waste pickers founded a Union for Collectors of Secondary Raw Materials. This initiative ganization, for example working at a high speed, the carrying out of simultaneous activities.99
was born through the support of the YUROM Center, an association created and run by Roma people The workers in the waste sector are very aware of the risks they are exposed to. This reflected in the
which works on behalf of Roma citizens to improve their quality of life and end discrimination against data from the European Working Conditions Survey (EWCS) 2010, which shows that workers in the
them. The Union focuses on solidarity and mutual assistance among collectors, improvement of their waste management sector feel that their health and safety is at risk. They survey found that 36.9% agree
legal and social status, and the inclu-sion in social dialogue at the local and national levels. In 2014 its with the statement ‘my health and safety is at risk because of my work’ and 33.9% feel that their health
membership included 1 500 individual informal collectors.94 is negatively affected by their work. This is a higher percentage than for all other sectors and it is even
higher than in the industry sector.100
Moreover, the data from the EWCS 2010 shows that the exposure is very high. For example 9% of
the workers in waste management state that they are exposed to smoke, fumes and dust ‘all the time’
Table 3 (see Graph 9).
Numbers of Informal Recyclers and Re-use Operators and level of organizing
in six European Countries
Graph 9:
Graph 9 Exposure to physical factors in the waste management sector – EWCS 2010
City and Country Numbers Organisation Exposure to physical factors in the waste management sector – EWCS 2010
Sofia, Bulgaria Diverse group of at least 2 000 No organising is reported.
pickers in Sofia. Roma men, and 175
women and their young children,

waste pick at non-compliant 150
dumpsites near bigger towns.

125
Greece, including Athens As many as 100 000 in Greece, The oldest waste pickers associ-
including part-time and seasonal ation of 1 185 persons, that are
100
pickers. Estimated 40% increase in selfdescribed as “mostly Muslim
waste picking since the economic Greeks”.
75
crisis.
Rome and other 60 000 to 80 000 operators work 1 100 are organised reuse traders 50
major cities, Italy in the informal re-use trade. Their and members of Rete ONU.
involvement in metal and plastic 25
recycling.
Skopje, Macedonia 5 000 street & dump pickers were A subset were organised into
identified by a USAID project. co-operatives between 2005 and
Vibrations from Noise High temperatures Low temperatures Smoke, fumes,
2013. hand tools dust
Bucharest, Romania 1 000 street pickers collect alu- The informal sector is unorganised,
minium used beverage containers. and there are no functioning asso-
Collect from apartments, offices ciations, cooperatives, or unions of
All of the time Almost all of the time Around 3/4 of the time Around half of the time Around 1/4 of the time
open markets, litter bins, parks. informal recyclers in Romania and
no visible actors within civil society
defending their rights. 175
Belgrade & other cities 35 000-50 000 Union for Collectors of Secondary
in South, Serbia Raw Materials. In 2014 its mem- 150
bership included 1 500 individual
informal collectors. 125
Sources: Scheinberg et al. (2016) From Collision to Collaboration: Integrating Informal Recyclers and Re-Use Operators in Europe,
100
A Review. Waste Management & Research.95 ILO (2014) Tackling informality in e-waste management: The potential of cooperati-
ve enterprises. P. 41, 42. 96
75
4.3 Health and Safety 50
As the World Health Organisation (WHO) has pointed out the management of waste is a demanding and 25
challenging undertaking in all European countries, with important implications for the general human
health and well-being in society.97 As such, waste workers are not only the environmental but also health
Vapours Handling chemical Tobacco Infectious
and safety heroes of our times, whose jobs put their own health at risk. Yet their work is often overlooked substances smoke materials
and unrecognized. For example, the WHO’s recent report entitled ‘Waste and human health: Evidence
and needs’ has paid almost no attention to the health implications for workers in the waste sector.98 Source: EWCS in oshwiki.101

Moreover, the number of accidents in the waste management sector are very high: the risk of an
accident at work is 2.5 times higher in the waste management sector compared to the average for all
other sectors.102
Unfortunately there are few detailed studies available which provide data on health and safety in the
waste sector per country. For the UK more detailed data is available. According to the latest report by the
Health and Safety Executive (HSE) there were 14 fatal injuries in the waste sector in the UK. On average
5 000 workers in the UK waste industry get injured and 6 000 suffer from work related illnesses. The risk
of fires on landfills and recycling sites is especially severe. On average there were more than 300 fires per
year at waste and recycling plants between 2001 and 2013.103 Furthermore, it has been reported that in
the UK sharp injuries are common when sorting recycling, caused by needles, jagged tin cans and other
sharp objects. They can lead to permanent disability and infection. Yet there are no statistics about these
injuries.104

In Europe Veolia signed two big new waste service contracts VEOLIA, 2016
and renewed one contract in 2016. All of them were in the UK.107 Revenue
The biggest one is a waste processing contract with Hertfordshire €24.39 Billion
County Council which is estimated to generate €1 679 million EBITDA
in revenue and has a duration of 30 years. Veolia also signed a €3.05 Billion
contract with Hampshire County Council for the management of Net income
household waste and recycling centres which is expected to cu- €610 Million
mulate €135 million in revenue and lasts 15 years. It also renewed CEO’s earnings
a contract with the London Borough of Camden for €285 million Salary: €950 000
5. Companies for 8 years. Bonus: €953 553
Globally, Veolia has extended its business in the waste sector Total: €1 903 553
mainly in Latin America.108 The biggest contract signed in 2016 was Number of employees
5. 1 The largest companies by size with the City of Tuluá in Columbia for household waste collection 163 226
and processing and street cleaning, which is estimated to cumulate Business Type
In the following table the five biggest waste companies in Europe are compared by revenue, their EBITDA, €43 million in revenue and will last for 10 years. Veolia also signed French company with large
their net-income, the CEO’s earnings and the number of employees. a contract with the City of Rancagua in Chile for Waste collection government shareholdings
There are several ways to compare companies’ financial performances. Their revenue depicts the and street cleaning, which is estimated to generate €22 million in
amount of money that is brought into a company by its business activities. Yet, the revenue does not revenue lasting for 5 years. Also, in Brazil it signed a contract with
give an indication of the expenses a company has. EBITDA is a useful indicator as it shows the earnings the city of Florianópolis for Waste collection and processing, which has only a duration of 2.5 years but
a company has before paying interests, taxes, depreciation and amortisation. Since it does not include is supposed to generate €22 million in revenue.
interests or tax expenses EBITDA is a useful measure of a company’s profitability when making international In its 2016 annual financial report Veolia presents its business strategies.109 Regarding waste the
comparisons. But it also has its pitfalls. Companies can adjust their profitability by using EBITA, which focus is set on waste collection, waste recovery and waste to energy incineration. It becomes evident
will always be higher than the reported net-income. The net-income is a company’s total earning/profit that Veolia aims to increase its involvement in the lucrative business of waste recovery and incineration,
and therefore a much more precise indicator of a company’s profitability. The net income is calculated especially waste to energy incineration. Given the policies around the circular economy and the phasing
by taking revenues and subtracting the costs of doing business such as depreciation, interest, taxes and out of landfilling in Europe (see section 3.2), waste recovery and incineration are becoming the most
other expenses. Yet, two of the European biggest waste companies do not even report their net income profitable aspects of the waste economy. Interestingly, the aspect of waste prevention is striking by its
in their annual report but use only the EBITA figure instead. absence from Veolia’s business strategies.
Veolia’s CEO is Antonie Frerot who was remunerated with €1 903 553 in 2016.
Table 4
The largest waste multinationals Table 5
Veolia’s global revenue distribution
Company Revenue EBITDA Net income CEO’s earnings Number of
employees 2016 2017
Veolia €24.39 Billion €3.05 Billion €610 Million
Salary: €950 000 163 226 ∆ at constant FX Q1 Q2 H1 Q3 Q4 Q1 Q2 H1
Bonus: €953 553 France +0.2% -0.7% -0.2% -1.3% -2.1% -1.5% -0.4% -0.9%
Total: €1 903 553 Europe excluding France -0.9% +0.3% -0.3% +0.6% +1.5% +7.2% +4.4% +5.9%
Suez €15.3 Billion €2.65 Billion €622.8 Million Salary: €750 000 83 921 Rest of the World -2.4% +1.9% -0.3% +6.3% +9.1% +11.8% +10.8% +11.3%
Bonus: €940 292 Global Businesses -2.9% -0.9% -1.9% -11.4% -1.1% -3.2% +1.7% -0.7%
Benefits in kind: €10 373 Total -2.1% +0.1% -1.0% -1.7% +1.9% +4.5% +4.4% +4.4%
Total: €1 700 665 Total excluding
Remondis* €6.4 Billion / €398.24 Thousand / over 30 000 construction & energy
FCC €5 952 Million €834 Million / / 54 467 prices +1.2% +1.9% +1.5% +1.6% +3.4% +5.9% +4.1% +5.0%
Alba €597 Million €5.9 Million / Salary: €0.5 Million 1 353
Bonus: €45 000 net Source: Veolia, 2017.
Source: combined data from the companies annual financial reports 2016.
* Figures are from 2015 5.3 Suez
Overall Suez business is growing. It increased its revenue in comparison to 2015, when it was with €15.1
5.2 Veolia billion slightly lower.110 It also increased its net income in comparison to the previous year (€407 million
net income in 2015).111 Suez also increased its number of employees: Suez employed 1 385 more people
Veolia is Europe’s biggest waste player. It manages liquid, solid, non-hazardous and hazardous waste in 2016 than in 2015. The total number of employees are 83 921 of which 61 064 are in Europe. In other
across the entire waste life cycle, from collection to recycling, to material and energy recovery and land- words, over 72% of its employees are in Europe.112
fill. In 2016 it operated 45 metric tons of treated waste in 591 waste processing facilities.105 Beyond that Suez is mainly active in delivering water and waste services, almost to an equal share. In 2016 51%
Veolia also operates public services in the energy, water and transport sector. of the Suez revenues were generated in the water segment and 49% in the waste segment.113 Most of
Overall Veolia’s revenue is increasing but a slight geographical shift is taking place. While Veolia’s Suez waste business is in Europe (see figure 7). In Europe, Suez is especially strong in France, the Benelux
overall business is declining slightly in France, it is increasing in the rest of Europe and also globally. Waste countries and Germany, where Suez aims ‘to control the value chain, rather than own or operate it’.114 It
is one of Veolia’s best performing sectors with a revenue growth of 6.4 per cent in 2016/2017.106 aims to expand its business in the UK especially through waste to energy recovery units.

Suez plans to expand its waste recovery business in Europe. As such, Suez is an advocator of the 5.5 Fomento de Construcciones y Contratas (FCC)
circular economy and, like Veolia, sees great business potential in the material and energy recovery from
waste.115 The FCC Group reported net attributable profit amounting to FCC, 2016
Suez is confident that due to the increasing compliance with European regulations it will be able to €153.5 million in the first nine months of 2017, contrasting with Revenue
increase its business in Central and Mediterranean Europe, and it is especially seeking to expand in Po- the loss of €179.4 million in the same period of 2016.124 The EBITDA €5 952 Million
land and the Czech Republic. In these countries the use of landfills is still very high, so there are business increased from €834 Million in 2015 to €834 in 2016. In the first 9 EBITDA
opportunities for waste to energy incineration. months of 2017 the EBITDA declined by 2.6 %. €834 Million
FCC is mainly operating in Spain, where over half of its revenue Number of employees
are coming from (see Figure 8). 54 467
Figure
Figure77: distribution of the Group’s consolidated revenues as of December 31, 2016. Environmental services, which waste management is part of, are Company type
Distribution of the Group’s consolidated revenues as of December 31, 2016. FCC’s largest activity. In 2016 over 51 % of its EBITDA came from Spanish, shareholder
this business stream. Yet this was a 3.8% decline in comparison to
the previous year which was mainly due to the depreciation of both
41% the pound sterling and the Egyptian pound.126
Recycling and
FCC has the following main shareholders. Inversora Carso, S.A. de C.V holds 231 504 295 shares,
Recovery Europe
which is 61.11% of the whole shares. Esther Koplowitz, who is also the chairperson of the FCC groups
holds 75 807 584, which comes to 20.01% of the total shares. William H. Gates III holds 21 729 431
shares, which are 5.73% of the total shares.
1% FCC is aiming to expand its energy from waste activities. In 2017 it commissioned its ninth energy-from
Other waste plant serving Worcestershire and Herefordshire, in the United Kingdom. The complex was designed,
developed and built by Mercia Waste Management, a company owned 50% by FCC.127
The number of staff has been reduced slightly, whereby most of them were seconded employees.
27%
The proportion of seconded employees has increased over the last 3 years. In total there were 54 467
International
employees in 2016 out of which only 9 438 were on permanent contracts, and 7 846 were on fixed
contracts while the majority, 43 031, were seconded employees. In other words almost 80 per cent of
31%
Water Europe the workforce were seconded employees.128 Seconded employees means that an employee (or group of
employees) is temporarily assigned to work for another organisation or a different part of their employer.
Further research on why FCC has a large majority of seconded employees is necessary. There are a few
Source: Suez, reference document 2016.116 reasons for this. One possibility relates to FCC’s practice of subcontracting, as FCC works with numerous
subcontractors.129 Under the Spanish law (article 44 of the workers statute) outsourcing continues under
the same terms. This means that all contractual benefits transfer when a transfer of an undertaking takes
Suez CEO is Jean-Louis Chaussade who gets paid a salary of €750 000. Additionally he received
Source:Suez, reference in 2016
document 2016 place (for example, pension commitments, car allowance, medical insurance, lunch and nursery vouch-
a bonus of €940 292 and €10 373 benefits in kind. This amounts to a total earning of €1 700 665 in ers) and the subcontractor must continue to observe the terms and conditions agreed in any collective
2016.117
5. 4 Remondis-Rethmann Figure88: FCC Revenue by region

Figure
FCC Revenue by region
The company Remondis is part of the Rethmann group, owned by REMONDIS, 2015
the Rethmann family. The family is one of the 10 richest families Revenue
in Germany with an estimated wealth of 6 billion.118 The Rethman
group has an annual turnover of €12 418 million in 2015 and em-
€6 024 M
Net income
55.6%
ployed 64 456 people. €398.24 Thousand
Remondis is part of the biggest service deliverers of water and Number of employees
recycling worldwide. Remondis operates in over 30 countries with over 32 000
over 800 sites globally. Its main market is Europe, especially Germa- Parent
ny, and Asia. It has the leading market position in Germany and the Rethmann Group
third biggest market share in Europe.119 Remondis employs more Business type
than 32 000 employees globally.120 German, traditional, private
In Germany the waste market is segmented. The largest compa-
nies dominate specific areas. Remondis for example has a monop-
oly position in residual waste in the provinces Schlesswig-Holstein, Nordrhein-Westfalen.121 13.6% 11.2% 9.9%
The continuous trend of re-municipalisation caused Remondis to lose profitable contracts. As
outlined above, Germany, Remondis key market, went through a wave of re-municipalisation processes 6.1%
in the waste management sector (see section 2.3). For example the city of Münster re-municipalised 1.1% 2.5%
its mechanical-biological waste treatment plant after the contract expired in May 2015. Remonis was
operating the plant for 10 years previously.122 Latin United Spain Middle East Central US and Others
Moreover, Remodis business has been affected by the termination of Public Private Partnerships America Kingdom and North Africa Europe Canada
(PPPs). The district Ilm, for example, bought back Remondis 49% share of the Ilmenauer Umweltdienst
GmbH, the local waste management site, through which it became 100% publicly owned.123 Source: FCC, 2017.125
Source: FCC, 2017

bargaining agreements.130 However, it is possible to structure employment as a secondment, especially
on a short-term basis. And there is a lack of clarity in the law whether or not seconded employees are
covered by article 44 of the workers statue.131 It is therefore possible that FCC is using seconded employ-
ees to get around workers protection and collective bargaining agreements. Another possibility is that
FCC is using secondment of employees for employees that temporarily work in other countries.
In 2016 FCC spent €1 389 944 on wages and salaries (which does not include social security costs).132
In 2016 there have been 6 death caused by occupational accidents.
In the last few years the CEO of FCC has changed frequently. In 2015 it was Juan Béjar Ochoa, who
was then replaced by Carlos M. Jarque CEO in 2016. In September 2017 Pablo Colio replaced Carlos M.
Jarque. The earnings of the CEOs are not publicly available.
5. 6 Alba Group
Alba had a significantly smaller revenue in 2016 than in 2015, as it ALBA, 2016
decreased from €1 Billion in 2015 to €597 Million in 2016. Yet in Revenue
the same time its net income more than doubled from €11 Million €597 M
in 2015 to €28 Million in 2016. This is because due to the falling EBITDA
global metal prices it sold a number of sites in Germany, while in €5.9 M
the same time expanding and increasing investment in China. Net income
Alba is mainly operating in Germany, where it specialises in re- €28 M
sidual waste metal recycling. It has a strong market concentration Number of employees
in residual waste in East Germany. Alba is expanding its business 1 353
mainly to China in partnership with the Deng family, who own the Parent
company Techcent. In China Alba operates in electronic and metal Alba Group
recycling, mainly car recycling. In Germany Alba is keen for Germa- Business type
ny to remain a key recycling site in Europe.133 German, traditional, private
Of its 1 353 employees the majority (784 workers) are occupied
in steal and metal recycling sector while 569 are occupied in other
services. Alba decreased the number of its employees in 2016.134
Alba’s CEO Dr. Axel Schweitzer, who like the other two directors on the board gets paid a €0.5 M
annually. In addition the chair Axel Schweitzer gets another €45 000 net.135

6. Social Dialogue
6. 1 Structure of the industry
The European Federation of Waste Management and Environmental Services (FEAD) represents the pri-
vate waste and resource management industry across Europe. Its members are national waste manage-
ment associations in 19 member states as well as Norway and Serbia. The executive council of the FEAD
consists of directors or managing directors of key national waste management associations (currently of
the BDE in Germany, the ESA in the UK, the DWMA in the Netherlands, the VOEB in Austria, FNADE in
France, ASEGRE in Spain, SRI in Sweden and FISE in Italy).
FEAD is an important player lobbying for the Circular Economy in Europe. In its strategy for the circular
economy for 2014-2020136 FEAD calls among other aspects for:
· Fair competition between the private and public sector providers of waste and recycling services,
to allow the private sector to invest in the circular economy;
· The opening up of household waste management markets to competition from private entities.
FEAD also lobbies at EU level for less public sector involvement in the recycling market. In a position In total 1 094 EWCs are in operation (figure from June 2016). While there has been a steady growth
paper before the plenary vote in the European Parliament on Circular Economy Package in March 2017 in the number of EWCs each year, this growth has been moderate and recently it has been gradually
FEAD states that it ‘observed a clear trend towards increasing public sector activity in the recycling mar- declining.144
ket in several Member States, resulting in cross-subsidisation and no tendering or restrictive tendering of All five waste companies analysed in this report fulfill the criteria for the creation of EWCs. However,
these services’. And subsequently argues for more competition and private sector involvement.137 only two of them, namely Veolia and Suez have EWCs. To date, FCC, Remondis and Alba have not es-
Municipal Waste Europe is the European representative umbrella organisation of public sector as- tablished EWCs.
sociations operating in the waste sector. Its members are public waste associations. Municipal Waste On the national level, Alba actively tries to avoid having a work council in Germany. By law, employees
Europe promotes an approach to waste management that minimises the impact of waste on the environ- in Germany have the right to elect a works council that must be consulted about specific issues and have
ment and promotes resource efficiency, taking into account local conditions.138 Municipal Waste Europe the right to make proposals to management. In 2015 the Hans Boekler Foundation found out that Alba
promotes the circular economy and especially lobbied for a new circular economy package when the created a ‘pseudo-foreign corporation’ to keep their supervisory board free from employee representa-
European Commission scrapped its first Circular Economy package in 2014.139 Municipal Waste Europe tives.145
advocates inter-communal cooperation and public-public co-operations.140 Regarding publicly-employed waste workers social bargaining is taking place in the Sectoral Social
The European Centre of Employers and Enterprises providing Public Services and Services of general Dialogue Committee for Local and Regional Government. The Sectoral Social Dialogue Committee for
interest (CEEP) represents employers and enterprises providing public services.141 CEEP lobbies for public Local and Regional Government was established by the European Commission in 2004 and EPSU and
services in Europe. Also, CEEP favours the circular economy approach to a linear approach to waste man- CEMR are the most important EU-wide representatives of the sector’s employers and employees.146
agement and in particular it advocates a quick ban on landfilling.142
The Council of European Municipalities and Regions (CEMR) is a European association of local and
regional governments, which defends the interests of local and regional governments as employers. The
CEMR is a partner consulted at each European initiative related to working conditions and work organi-
sation. Through European social dialogue of local and regional governments it cooperates with EPSU in
order to negotiate and agree on common solutions in the matter of European social policies.143
6.2 European social dialogue
European works councils (EWCs) are a fundamental aspect of social dialogue at the European level.
Through EWCs workers representatives are informed and consulted at European level by the central
management of their employer on the progress of the company and any significant decision that could
affect the workers. If a company employs at least 1 000 employees in the EEA and at least 150 employ-
ees in two member states the company or the employees can establish a European Work Council. The
right to create EWCs was introduced by Directive 94/45/EC.
EWCs are an important tool of industrial relations at the European level as they improve the infor-
mation flow between workers and management significantly, allowing for consultation of workers on
relevant cross-border issues.

7. Conclusion
This report was commissioned by the European Federation of Public Service Unions (EPSU) to inform a
workshop entitled ‘the future of the waste sector in Europe: challenges and opportunities for workers’
to be held on 7th December 2017 in Brussels. Its main research findings are:
· The public/private split in the waste sector remains. There are cases of further privatization in
some member states while simultaneously there are also cases of re-municipalisation.
· Re-municipalistion is mainly a trend in Germany, where it had a positive impact on the consumer
prices of waste collection and bears the potential of improved working conditions.
· The circular economy package leads to a further reduction in landfilling. Therefore, there will be
an increase in the incineration of waste as well as recycling. This will change the employment in
the waste sector significantly.
· Employment in the waste management sector is increasing. In 2014 1.1 million full-time equiv-
alents were employed in the sector. This is a 36 % increase in employment since the year 2000.
· Employment in the waste management sector is unevenly distributed between countries. Most of
the jobs in the sector are located in Germany, the UK, Italy, France and Spain. It is assumed that
the jobs created as part of the transition towards a circular economy will mainly benefit the exact
same countries.
· Waste collection provides the majority of jobs in the waste sector. Far fewer employment oppor-
tunities are found in material recovery. It also seems that the increase in recycling is not mirrored
by a significant increase in jobs. Less than 200 000 people are occupied in material recovery and
the employment growth has been just 1.3% from the beginning of 2013 to the end of 2014.
However, this picture changes drastically when taking the informal sector into account. It is esti-
mated that up to one million people in Europe are occupied in the informal recycling and re-use
economy.
· To date, little research has been done on the working conditions of people employed in the waste
management sector and the wider circular economy.
· The circular economy brings challenges and opportunities for trade unions. Recycling is an impor-
tant aspect in the transition towards the circular economy and therefore should be encouraged.
More research on the working conditions in recycling plants is highly recommended as initial
research on recycling factories in Northern and Central Europe suggests that most working condi-
tions are poor, advantage is taken of a predominately migrant workforce and that the pay is low.
Organising these workers create opportunities to facilitate a transition to a circular economy that
is not only sustainable but also non-exploitative.
· Another major challenge and opportunity for workers strength in the circular economy lies in
the informal sector. As it is assumed that far more people are occupied in the informal than in
the formal recycling sector, the integration of these workers into the formal economy has a lot
of potential. If recycling was seen as an important public service, then public sector jobs with
improved working conditions could be created. Informal waste pickers could then be employed
by the public sector. Several organisations, especially in Southern and Eastern Europe, have been
set up that represent the interests of the informal waste workers, which could provide potential
allies for public sector trade unions.

8. Notes
1
European Parliament (2017) Towards a circular economy- waste management in the EU. P. 31. Available at:
http://www.europarl.europa.eu/RegData/etudes/STUD/2017/581913/EPRS_STU(2017)581913_EN.pdf
2
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composted_in_the_EU-27,_1995_to_2015_update.png
3
4
5
6
7
European Commission (2016) Legal Assistance on the application of public procurement rules in the waste sector. P. 22.
Available at: https://www.bde.de/assets/public/Dokumente/Europa/MP/Legal-Assistance-on-the-application-of-public-
procurement-rules-in-the-waste-sector.pdf?
8
9
10
11
PSIRU (2012) Public and Private Sector Efficiency. Available at: http://www.psiru.org/sites/default/files/2014-07-EWGHT-
efficiency.pdf
12
Bel, G./Fageda, X. and Warner, M. (2010) Is private production of public services cheaper than public production? A
meta-regression analysis of solid waste and water services. P. 575. Available at: http://onlinelibrary.wiley.com/doi/10.1002/
pam.20509/full
13
European Commission (2004) Resource Book on PPP Case Studies. P. 77. Available at: http://ec.europa.eu/regional_policy/
sources/docgener/guides/pppresourcebook.pdf
14
PSIRU (2012) Public and Private Sector Efficiency. http://www.psiru.org/sites/default/files/2014-07-EWGHT-efficiency.pdf
15
Bel,G. and Warner, M. (2008) Does privatization of solid waste and water services reduce costs? A review of empirical
studies. Available at: http://www.sciencedirect.com/science/article/pii/S0921344908001195
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eu/2017/07/sardinia-proves-that-zero-waste-is-possible-on-islands-too/
17
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19
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22
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Contact details:
Guillaume DURIVAUX
European Federation of Public Service Unions (EPSU)
Policy Staff – Public Utilities and European Works Councils
+32 2 250 10 41
[email protected]
Rue Joseph II 40, Box 5
1000 Brussels
Belgium

EPSU is the European Federation of Public Service Unions.
lt is the largest federation of the ETUC and comprises 8
million public service workers from over 250 trade unions
across Europe. EPSU organises workers in the energy, wa-
ter and waste sectors, health and social services and local,
regional and central government, in all European coun-
tries including the EU’s Eastern Neighbourhood. lt is the
recognised regional organisation of Public Services lnter-
national (PSI).
www.epsu.org
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Contents

15 3. THE CIRCULAR ECONOMY

19 4. EMPLOYMENT IN THE CIRCULAR ECONOMY

30 5. COMPANIES – THE BIG 5

6 Waste Management in Europe. Good Jobs in the Circular Economy?

8 Waste Management in Europe. Good Jobs in the Circular Economy? 9

10 Waste Management in Europe. Good Jobs in the Circular Economy? 11

12 Waste Management in Europe. Good Jobs in the Circular Economy? 13

3.1 Towards the Circular Economy

EXTRACTION AND IMPORT OF NATURAL INCINERATION LANDFILL

Source: EEA, 2015

14 Waste Management in Europe. Good Jobs in the Circular Economy? 15

3.2 The EU and the Circular Economy

16 Waste Management in Europe. Good Jobs in the Circular Economy? 17

4.1 Employment in the waste management sector

2006 2007 2008 2009 2010 2011 2012

18 Waste Management in Europe. Good Jobs in the Circular Economy? 19

Country 2012 2013 2014 2015*

Hungary 17 298 17 338 15 135 16 076

Ireland 6 382 6 406 6 342 6 498

20 Waste Management in Europe. Good Jobs in the Circular Economy? 21

Recovery of sorted materials

22 Waste Management in Europe. Good Jobs in the Circular Economy? 23

24 Waste Management in Europe. Good Jobs in the Circular Economy? 25

women and their young children,

dumpsites near bigger towns.

4.3 Health and Safety 50

26 Waste Management in Europe. Good Jobs in the Circular Economy? 27

28 Waste Management in Europe. Good Jobs in the Circular Economy? 29

30 Waste Management in Europe. Good Jobs in the Circular Economy? 31

5. 4 Remondis-Rethmann Figure88: FCC Revenue by region

32 Waste Management in Europe. Good Jobs in the Circular Economy? 33

34 Waste Management in Europe. Good Jobs in the Circular Economy? 35

6. 1 Structure of the industry

6.2 European social dialogue

36 Waste Management in Europe. Good Jobs in the Circular Economy? 37

38 Waste Management in Europe. Good Jobs in the Circular Economy? 39

40 Waste Management in Europe. Good Jobs in the Circular Economy? 41

42 Waste Management in Europe. Good Jobs in the Circular Economy? 43

44 Waste Management in Europe. Good Jobs in the Circular Economy? 45

46 Waste Management in Europe. Good Jobs in the Circular Economy? 47

48 Waste Management in Europe. Good Jobs in the Circular Economy?

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