2012 - Organisation and coordination of a network on the EU coordination of social security schemes...

Organisation and coordination of a network on the EU coordination of social security schemes in EU/EEA/CH

training and reporting on European Social Security

trESS III

trESS national seminar ItalyRome, 30 May 2012

Yves Jorens – Project Director

Applicable legislation

• Which legislation is applicable ? One of the key problems for migrant workers

• The principle in international treaties: strong and exclusive character: avoid positive and negative conflicts

• EU Regulations 883/2004 and 987/2009: “Acquis Communautaire” free movement of workers

EU Regulation 883/2004

• Applicable in 31 countries (Switzerland)

• Regardless of nationality

• All insured people, i.e. employed persons, self-employed persons, civil servants and students

EU-concept: national social security legislation, not labour relations

What are the fundamental principles behind the actual conflict rules ?

• Neutral character only avoidance of administrative complications no principle of favouritism• Compulsory character public character of social security no free choice MS cannot determine extent to which their or another MS'

legislation is applicable• Exclusivity and strong effect: mirror of single

applicable legislation actually under pressure

The general framework

• Conflict rules: strong and exclusive character: only one legislation is

applicable all contributions must be paid in this state separate rules for active and non-active persons

The general framework: active and non-active persons

• Fundamental choice: Active Persons: lex loci laboris regardless where you live / employer is based

BUT: civil servant: state of administration employing this person

non-active people: MS of residence

activity on board of a vessel: state of flag unless person works

on vessel of the flag state and is remunerated by an

undertaking of other state and lives in that state: state of

residence

Posting

1. Concept one remains during temporary employment abroad

subject to country of normal employment and not subject to country of temporary employment

2. Objectives avoid administrative complications avoid impediments to the free movement of workers

and services

Posting

3. See Decision A2 of 12 June 2009 and Posting guide

4. Is posting obligatory or not ?Yes (Van Delft-case)

Posting

• Distinction between posting and simultaneous activities in more than one MS:

the duration of the activity in one or more other MS (whether it is permanent or of an ad hoc or temporary nature) shall be decisive. For these purposes, an overall assessment shall be made of all the relevant facts including, in particular, in the case of an employed person, the place of work as defined in the employment contract (IR, Art. 14(7))

Posting within the European Union: judicial framework: several conditions to be fulfilled

1. Non-condition: nature of employer's business is irrelevant also companies that engage workers just for posting abroad

(eg. interim agencies)

2. Condition 1: Workers must be subject to legislation of country of origin persons must be subject to legislation before posting (not

same as employer) when is someone attached? 1 month for employees / 2

months for self-employed is this acceptable? case by case study not possible: work in A for employer in B and being posted

from A to B


3. Condition 2: Organic link between employer and posting undertaking "on behalf of employer" legal link (not economic) between employee and employer number of elements are taken into account to determine the

authority of employer: recruitment, contract of employment, dismissal, nature of work (≠ instructions), decision on remuneration (decision ≠ who actually pays)

labour contract with host company excludes posting: in all circumstances?

4. Condition 3: Link between employer and state where employer is established "employer normally carries out activities there" ordinarily perform activities there: not purely internal

management activities


avoid post-office box companies Plum Case (404/98): German construction company set up

Dutch company to combat stronger competition of Dutch construction companies in Germany: only administrative matters (answer phone, receiving mail – sometimes forwarded to Germany, accounts and job interviews)


criteria depend on characteristic of employer and nature of activities, i.e. quantitative assessment place of registered office number of administrative staff in posting state and state of

employment place of recruitment (but is only there where one pays

contributions) Majority of contracts with clients law applicable to contracts with clients and workers:

but it is labour law (workers) country of consumer (clients)


number of contracts executed in posting state and employment state

turnover (of about 25%) during appropriate typical period: difficult / fiscal aspect included – what is appropriate period? (not period of posting)

=> How long has an employer to conduct business in posting state? No period.


5. Condition 4: Duration maximum duration: 24 months (under 1408/71: 12 +

12 months) prolongation: Art. 16: 2 or more MS, the competent

authorities of these MS or the bodies designated by these authorities may by common agreement provide for exceptions to Articles 11 to 15 in the interest of certain persons or categories of persons


normally up to 5 years in the interest of person this is employee, not employer (eg. Cyprus with respect to

seafarers: country of maritime employment that has lower costs) not the benefits are important different criteria

Potentially retroactive (Brusse, 101/83) = when legislation applied by mistake, agreement confirms application

discretionary character can also be used in other (posting) situations

ex. Bâle-Mulhouse airport employees subject to Swiss legislation if residence in Switzerland and toreadors living in France and occasionally taking part in bullfights in Spain

Suspension, Interruption and Cessation of Posting

• Posting to different MS which immediately follow each other shall in each case give rise to a new posting

• Brief interruption of the worker's activities with the undertaking in the State of employment, whatever the reason (holidays, illness, training at the posting undertaking, recalled for instructions …), shall not constitute an interruption of the posting period: so no illicitly extension by temporary interruption

Suspension, Interruption and Cessation of Posting

• When will temporary interruption result in cessation of posting? (Decision A2, 12 June 2009)

Once a worker has ended a period of posting, no fresh period of posting for the same worker, the same undertakings and the same MS can be authorized until at least 2 months have elapsed from the date of expiry of the previous posting period

2 months counts for each period of interruption: e.g. after 3 times 1 month there is no interruption


6. Condition 5: No rotation of personnel may not be sent to replace another (posted?) person difficult to control if a particular position is continually

being taken by a succession of new people different flexible interpretations, eg. counting

contiguous period together ↔ deforestation

Posting and administrative formalities

• Which formalities ? Structured portable electronic documents (SED’s) A1-form replaces E-101 form• Control, avoid abuse one of the big problems: not filled in forms, errors (not

anymore under A1 forms?) legal nature of EU-forms forms issued are binding for other institutions and judges !


Scope of E101 form: « So long as it has not been withdrawn or declared invalid, an E 101 certificate, is binding both upon the competent institution of the MS to which a self-employed person goes in order to carry out a work assignment and the person who calls upon the services of that worker” (Banks, C-178/97)

As long as it has not been withdrawn or declared invalid by the authorities of the Member State which issued it, an E 101 certificate binds the competent institution and the courts of the Member State in which the workers are posted (Kiere NV, Case C-2/05)


should be withdrawn or declared invalid by MS that issued

should ask issuing state for re-examination: 6 months for agreement; dialogue and conciliation procedure: agreement through contact person or to Admin. Commission if no agreement: 6 months

Posting and self-employed

A person who normally pursues an activity as a self-employed person in a MS who goes to pursue a similar activity [1408: not required] in another MS shall continue to be subject to the legislation of the MS, provided that the anticipated duration of such activity does not exceed 24 months (BR, Art. 12(2))


• eg. English opera singer performing one night in Brussels; German plumber fixing a leak in Luxembourg

• Unnatural phenomenon ?

• Very difficult to make a distinction with forms of simultaneous employment


• Normally pursues implies:

habitually carries out substantial activities in posting state

pursued an activity before one is posted: 2 months: but flexible !

fulfil conditions in country of establishment during posting enabling to continue work after return: no pro-forma affiliation

2012 - Organisation and coordination of a network on the EU coordination of social security schemes...

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