A new Framework Agreement on Telework has been put in place among EU/EEA countries (including Switzerland) in order to govern social security for cross-border commuters following Covid-19.
Please find further information about the agreement here: https://lnkd.in/ewnZJMsQ
It is optional for each EU/EEA county to opt into the agreement. Currently (4 October 2023) 19 countries have signed the agreement. The scope of the agreement covers teleworking in a narrow sense.
Due to the narrow scope of the agreement and the fact that not all EU/EEA countries have signed, some commuter cases need to be managed according to the traditional rules on EU social security coordination.
Please find the below presentation, which showcases examples of such basic scenarios as well as how these have been solved.
Despite the circumstance that the examples build on real-life cases and actual solutions, the presentation is made for discussion purposes only. As the agreement is new and variations in the applicability of the EU social security rules may be experienced in each EU/EEA country, a case-by-case assessment should always be made.
This is part 3 of our scenario insights. Please find our previous scenarios here
– Part 1: https://lnkd.in/eA9xi7uu
– Part 2: https://lnkd.in/enCUbp9n
Please do not hesitate to reach out to Gary Chandler, Leanne Birch, myself or your local Vialto Partners contact if you wish to discuss further.
For more information please find below the content:
New Framework Agreement for EU/EEA commuters
Long-distance commuter
Situation
● Employer established in country A.
● Employee living in country B.
● Country B has not signed the New EU/EEA Framework Agreement on Commuters.
● The employee is performing a long-distance commute between home and the office taking an approx 2 hour flight each way.
● The employee wishes to work from home 2 days a week.
● The employer is paying for the commute flight tickets.
Comments
● The EU/EEA Framework Agreement does not apply.
● The employee is covered by social security in country B if 25 % or more of the total work is performed in country B.
● Traditionally, a two-day work week from home would trigger a commuter to be socially secured in country B.
● However, long-distance commuters may spend substantially longer work days at the office than at home.
● For example, if the employee works 3 x 10 hours at the office the employee may distribute up to 2 x 5 hours working from home without triggering social security coverage in the residence country.
● Also, old EU case-law could suggest that commuting time is calculated as work in country A, if paid for by the employer.
● The above always has to be looked into on a case-by-case basis, also taking into account applicable labour laws
Temporary WFH commuter assignment
Situation
● Employer established in country A.
● Employee living in country B.
● Country B has not signed the EU/EEA Framework Agreement on commuters.
● The employee’s main place of work is at the employer office in country A.
● The employee would like to work from home 3-4 days a week for a temporary period over the next two years while having small children.
● The employee and the employer concludes a temporary WFH commuter assignment agreement.
Comments
● As a starting point the employee would be covered by social security in country B as 25 % or more of the work is being performed there.
● However, if the work in country B is deemed temporary (and not permanent), a special posting provision could maintain the employee in the social security schemes of country A.
● According to a recent EU guideline the posting mechanism applies when ”[t]he employee can only continue to work from home, because e.g. s/he has to care for sick children, or small children or is the partner of such a person (otherwise this employee would have e.g. to take paid or unpaid leave and would not any longer be in a position to exercise the work.”
● It is unclear if this guideline applies when the employee is working partially in country B.
● A case-by-case assessment has to be conducted, especially taking the practices of country A into account
Delivering a temporary service
Situation
● Employer established in country A.
● Employee living in country B.
● Country A and B has signed the EU/EEA Framework Agreement on commuters.
● The employees main place of work is at the employer office in country A.
● The employer wins a two-year project with a customer in country B.
● As the employee speaks the language in country B, the customer ask for this employee to deliver the service.
● For the next two years the employee spends 40 % of the work time in country B working on the project.
● A temporary assignment agreement is concluded between the employee and the employer.
Comments
● As a starting point the employee would be covered by social security in country B as 25 % or more of the work is being performed there.
● However, if the work in country B is deemed temporary (and not permanent), a special posting provision could maintain the employee in the social security schemes of country A.
● According to an EU guideline, the circumstance that the relocation of the workplace is driven by the employee’s personal interests – which is often the case for workcation or work from home – does not preclude the application of the posting mechanism.
● A case-by-case assessment has to be conducted, especially taking the practices of country A into account.
Managing healthcare for new hires
Situation
● Employer established in country A.
● Employee living in country B with his family.
● The employee starts the employment by 1 July 2023, working 2 days a week from home.
● The employee has previously been working in country B and covered by social security there.
● An A1 application is filed in country A under the new EU/EEA Framework Agreement.
● Following the issuance of the A1 certificate the S1 application is filed country A.
Comments
● When the employee changes employer, the employee is now socially security in country A and no longer socially secured in country B.
● Therefore, the health insurance coverage for the employee and the family members is ended.
● The healthcare coverage in country B can be continued by virtue of the S1 certificate.
● However, the lead times for the A1 to by issued followed by the S1 can be several months.
● It is therefore important to discuss, how to ensure healthcare coverage for the employee and the family members until the S1 is in place.
We would be happy to hear from you
Gary Chandler
Global Social Security
+44 7796 941035
gary.chandler@vialto.com
Adam Rewucha
Northern Europe
+45 21 99 64 83
adam.rewucha@vialto.com
Morgane Texier
Southern Europe
+33 (0)1 56 57 42 12
morgane.texier@avocats.vialto.com
Barbara Kolimeczkow
Eastern Europe
+48 502 184 825
barbara.kolimeczkow@vialto.com
Lara Kodytek
UK and Ireland
+ 44 (0) 7889 654583
lara.kodytek@vialto.com
Leanne Birch
GSS Operational Lead
+44 (0) 7736 258224
leanne.c.birch@vialto.com
Wendy Toonen
Northern Europe
+31 (0)6 53959372
wendy.toonen@vialto.com
Natalia Graf
Southern Europe
+41 79 878 01 41
natalia.graf@vialto.com
Dénes Megyesi
Eastern Europe
+36 30 958 3705
denes.megyesi@vialto.com