July 22nd, 2020 / Insight posted in Articles

Global mobility: EU posted workers enforcement directive

The EU’s posted workers directive is coming into full effect on 30 July 2020. Most companies do not understand their obligations and responsibilities in this new compliance environment. This leaves some businesses potentially exposed to penalties for administrative failures. The UK has yet to fully embrace the scheme but UK employers need to review how they are affected when sending people to EU member states.

The original EU posted workers directive was designed to ensure workers moving across Europe have the same rights and living conditions as those living and working in the location of their secondment. Subsequent enforcement directives require these conditions to be implemented by the member states and host countries to be notified of any employees on secondment within their borders.

Although the directives were originally designed to protect employees on secondment between EU member states, many countries have expanded the scope of their notification procedures to include those on secondment from any country, not just those within Europe. The following outlines some of the actions we recommend you consider at this time.

Identify your posted workers

You will need to track and monitor your employees who fall within the posted worker criteria. The EU defines a posted worker as “an employee who is sent by his employer to carry out a service in another EU Member State on a temporary basis, in the context of a contract of services, an intra-group posting or hiring out through a temporary agency”.

Some countries specify exclusions from posted worker notification. For example, where an employee is on a short trip for the purpose of attending a conference or installing a purchased product for a client, they may not be required to file a posted worker notification with the host country.

Recognise relevant scenarios

You should ensure you are clear about the scenarios to which the posted worker directives apply. One of the following situations is likely to be a relevant scenario:

  • You agree to provide a service to a client in another member state and need to send staff there in order to carry out this work.
  • You post a worker to another country through arrangements within a group of companies, with the parent and subsidiaries based in different member states.
  • A worker is posted through an agreement between you and an employment agency.

Plan for six minimum standards

You should review your policies and secondment terms and conditions. The following categories of protection should be provided at least equally to those currently offered to local workers:

  • Working hours, paid holiday and wage
  • Agency worker standards
  • Health and safety
  • Pregnancy and maternity protection
  • Anti-discrimination law
  • Collective agreement standards.

This means that, if a posted employee is already paid a higher wage than a staff member in the host location, no change needs to be made. Alternatively, if the assignee is going to be working in a location where the pay is higher than their existing salary, the wage must be amended.

These rights do not include any other rights which are already established across the region, such as the various articles under the European Convention on Human Rights and the EU Race Equality Directive, which must also be met.

Plan for notification management and country representation

The directives require posted worker notifications to be submitted to the host nation for each secondment. The purpose of these notifications is to inform the host country of the assignee’s intention to carry out the work on a temporary basis.

Businesses need to plan how to manage these notifications and whose responsibility it will be to provide prior notification to local authorities, and keep records relating to any planned secondments.

Be aware of country-to-country variations

The regulations around posted worker notification can vary widely from country to country within the EU, so it is essential you access up-to-date information, and assess the requirements for each individual secondment. If an employee does not require a posted worker notification for one country, this does not mean that they will not need one for another country, even if they are completing the exact same assignment over the same timeframe.

It is vital you assess your posted worker notifications processes step by step. You will need to do this with full knowledge and understanding of each host country’s requirements in terms of employee rights, liaison officer appointments and document retention policies that will typically include copies of contracts, schedules, time sheets, payslips, etc.

Avoid non-compliance penalties

The penalties for non-compliance with the EU posted workers directive are primarily financial, with the value and application of the fines set by each member state. Multiple or repeated breaks in compliance can quickly lead to increasing and multiplying fines, as penalties are often demanded from the organisation on a per-employee basis. It is therefore essential that businesses, especially those with large secondment programmes, are proactive in meeting the posted worker notification requirements in their countries of operation. The following illustrate the severity of potential fines:

  • Late notification filing: up to €10,000 per employee
  • Incorrect filing: up to €10,000 per employee
  • Violation of employment standards: up to €50,000 per employee
  • Severe and repeated non-compliance: up to €500,000 per employee

Time is running out

Moore Kingston Smith can help you evaluate how you can best approach planning to manage the EU posted worker enforcement directive, so that you avoid failing to comply with the notification, and representation requirements and ensure your assignment terms meet the minimum employments terms and conditions for the host member states in which you operate.