17 EU countries sign new
social security agreement
for cross-border teleworkers

14 July 2023

On 1 July 2023, a new Framework Agreement on social security for cross-border telework, signed by 17 European countries, took effect.

Under the multilateral agreement, cross-border workers who work remotely in their country of residence for up to 49.99% of their working time are able to choose to remain under the social security regime of the country of their employer.  This requires a formal or informal agreement between the employer and employee which can last for up to one to three years (depending on local rules) with possible extensions.

This framework only applies in certain circumstances:

• Both the employee’s country of residence and the country of the employer’s registered seat must have signed the Framework Agreement.
• It only applies to cross-border telework in the country of residence.
• The employee may not habitually carry out other activities in the country of residence or habitually work in another country than the country of residence or the country of the employer’s registered seat.
• It does not apply to self-employed workers.

All 27 EU Member States have been invited to sign the Framework Agreement, along with Iceland, Liechtenstein, Norway, Switzerland and the United Kingdom.

So far, the following countries have signed the agreement: Austria, Belgium, Croatia, Czechia, Finland, Germany, Liechtenstein, Luxembourg, Malta, the Netherlands, Norway, Poland, Portugal, Slovakia, Spain, Sweden, Switzerland.

Requests can be made retroactively up to a maximum of three months. However, by way of exception, the first requests can be submitted up to 30 June 2024 and apply retroactively up to a maximum of 12 months (but not before 1 July 2023) provided that social security contributions have been paid in the state of the employer’s registered seat.

Background

Regulation (EC) 883/2004 states that only one social security regime can apply (that of the work state). For employees working in more than one Member State, the employee is subject to the social security regime of the country of residence if he or she works there for 25% or more of their working time.

The sudden growth of telework during the COVID-19 pandemic led to measures to avoid this change of competent state for the social security of the worker. These measures applied until 30 June 2023.

Immigration advice for cross-border workers

Cross-border workers and those who work remotely outside of their country of residence should take particular care to ensure they are not inadvertently violating any immigration rules.

With flexible working patterns on the rise, employers too should be aware of their remote workforce and can face legal repercussions if an employee does not have permission to work in the jurisdiction from which they are working.

The Global Immigration team at Smith Stone Walters is on hand to provide advice, whether it be from an individual perspective or an employer looking to review their compliance on remote working. We can provide assistance in making the relevant applications and ensuring the local immigration rules are met thereafter.

To speak to an immigration advisor, please contact us today.

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