New EU regulation per July 30, 2020
Employees who temporarily carry out work in another EU country in the context of cross-border services, are considered posted. On July 30, 2020, a new EU regulation entered into force to ensure fair labor mobility on the EU internal market and to improve workers’ protection.
Directive 2018/957/EU provides that the concept of remuneration is determined at its appropriate level i.e. by the national law and/or practice of the host Member State. The employer must ensure that the amount paid to the posted worker at least equals remuneration commonly paid under the rules of the host Member State (equal pay for equal work), while under the previous Directive only “minimum rates of pay” were granted to posted workers.
Besides the granting of certain existing employment conditions within the host Member State to posted workers, Directive 2018/957/EU prescribes two new conditions that must be added to this list:
- workers’ accommodation conditions, if and when provided by the employer to posted workers; and
- allowances for or reimbursement of expenses to cover for travel, meal and lodging expenses for workers away from home for professional reasons.
In case of long-term postings (more than 12 months), the new Directive provides for the application of all relevant employment conditions applicable in the host Member State, excepting (a) procedures and conditions for commencement and termination of employment agreements as well as (b) the rules on supplementary occupational pension schemes. One needs to keep in mind that any posted employee replacing another to perform the same work at the same worksite, will be considered as one and the same posting, as a result of which the replacing employee will sooner be entitled to all relevant employment conditions applicable in the host Member State.
An exception applies to postings related to an initial assembly and/or installation of products, conditioned upon the posting not lasting more than 8 days. In such cases, mandatory rules on minimum leave and minimum remuneration shall not apply (note: this exception is not applicable to the construction sector and the performance of construction work).