Social Clauses in Public Procurement in Denmark 

Udgivet: 28-09-2011 | Redigeret: 31-08-2016
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OAO´s contribution to the joint EPSU/CEMR statement on the EC Guide on Socially Responsible Public Procurement  (SRPP) of June 2011, Danish example.

Denmark has ratified ILO Convention No. 94. The convention can be applied in all public tenders but has in the case of Denmark only binding effect in relation to government procurement.

Several municipalities, however, have decided to inscribe the Conventions provisions in their procurement strategy. Frederiksberg Municipality, for example, has adopted a social clause, which is applicable when contracting out (Frederiksberg Kommune, 2010):


"Suppliers/bidders must ensure employees (who are employed by the bidder as well as potential subcontractors) wages and employment conditions no less favorable than the wages and employment conditions applicable to that sector of the region where they work".

"If the supplier/bidder fail to meet these obligations, and this results in a valid claim from the employee Frederiksberg Municipality may withhold payment to the bidder in order to meet this requirement. Bidders have the responsibility to ensure that employees employed by the bidder or any subcontractors for task execution, have valid work and residence permits. Frederiksberg Municipality reserves the right to exclude employees who do not possess the necessary work or residence permits and who are not registered in the database RUT. Failure to meet the social clause constitutes a material breach of this contract. "

"The individual contracts should involve questions regarding social clauses, which require local suppliers to enter into dialogue on the recruitment of staff on special terms (to meet the obligations imposed on the municipality as an employer). Furthermore the social clauses aim to encourage the contract holder to establish apprenticeships within the construction area, where appropriate". (Source: Frederiksberg Municipality Plan)

Social clauses in public procurement have little influence on the suppliers' price. This is the result of an evaluation of social clauses used when contracting out in Aarhus Municipality. According to suppliers lifting a social responsibility is today an integrated way of working and therefore not something that causes costs to rise.

 

When suppliers today bid for public contracts containing a social clause it only affect the price in about 50 percent of the cases. Furthermore the suppliers who raises the price due to social clauses, only raises the price marginally. This is the result of an evaluation from Denmark´s second largest city, Aarhus.

 

The evaluation is based on 12 trials with social clauses in public procurement that Aarhus Municipality has conducted in different areas. 

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