Stricter Rules Adopted in Amendment to Posted Workers Directive

The situation

On June 21, 2018, the Council of Ministers of the European Union adopted an amendment to the Posted Workers Directive which seeks to reduce differences in employment conditions between posted and host country workers.

A closer look

• Calculation of remuneration. Gross remuneration of posted workers will be in accordance with host EU Member State laws and generally binding collective labour agreements. Posting-related allowances should be considered part of the posted worker’s remuneration, unless the purpose of the allowance is to reimburse the employee for payments for travel, board and lodging related to the posting.
  • Impact. The amendment imposes equal pay between posted and host country workers immediately, instead of requiring the employer to comply with the host country’s minimum salary level.

 

• Application of employment laws. The employment conditions of the host EU Member State will now apply for long-term postings exceeding 12 months (which can be extended for six months on the basis of a justification by the service provider), if they are more favorable than the home country’s employment laws.
  • Impact. The impact of this change depends on the duration of the posting and the favorability of each country’s employment laws. The host country’s employment laws apply for postings longer than 12 months.

 

• Replacement of posted workers. In case of replacement of a posted worker by another posted worker for the same job at the same work place, the calculation of the 12-month stay period (18 months with an extension) is based on the cumulative duration of the individual posting period.
  • Impact.  Employers sending multiple employees to cover the same role in the same workplace should be aware that their employees may need to comply with host country employment conditions.

 

• Transportation sector. Due to the complexity of the transportation sector’s laws, the sector-specific laws will apply instead of the amended Posted Workers Directive when the transportation sector implements its laws.
  • Impact. Employers in the transportation sector should follow the implementation path of the sector’s laws to ensure compliance.

 

Background

The European Parliament approved the amended Directive on May 29 and the Council provided its final approval today.

Looking ahead

Once the new Posted Workers Directive is published, which is expected to take place within a few days, Member States will need to amend their current national legislation to comply with the new requirements within two years. Although the Posted Workers Directive applies to intra-EU postings, some Member States may extend the employer's obligations to companies located in third countries and temporarily seconding staff to the European Union.

This alert is for informational purposes only. If you have any questions, please contact the global immigration professional with whom you work at Fragomen or send an email to [email protected].