Posted Worker Directive & A1 Certificate - Everything You Need To Know

What is the A1 certificate?

An A1 certificate is the confirmation that a worker is subject to the legislations of their own country and is thus not required to pay social security contributions in the destination country.

The A1 certificate is a European portable document (PD) which attests to the social security legislation which applies to you while you are pursuing activities in different EU Member States. It includes the following information:

• The validity period of the certificate
• The country in which you are subject to social security and paying contributions.

The A1 certificate is issued on request by the competent body of the Member State whose legislation applies to you, confirming that your are not subject to the destination country’s social security.

The Posted Workers Directive (PWD)

Firstly, what is “posting” of a worker?

A “posted worker” is a worker sent by their employer to carry out a service in another EU Member State. This “posting” is temporary, in the context of a contract of services, an intra-group posting or a hiring out through a temporary work agency.

Posted workers remain in the host Member State only temporarily and do not permanently integrate its labour market.

What is the Posted Workers Directive?

Originally introduced in 1995 to protect employment rights of individuals working in other European countries, the PWD was amended in 2018 and finally came into effect on July 30th, 2020. It is meant to strengthen the protection of workers posted abroad and ensure compliance with social security laws, with the ultimate goal of avoiding “social dumping”.

This latest revision created new compliance requirements across the EEA which employees and organisations must abide by and affect three main aspects: posted worker A1 remuneration, long-term overseas postings and temporary agency workers. The rules establish that posted workers are entitled to a set of core rights in force in the host Member State (if these aren’t inferior to those of their own Member State). These rights include:

• minimum rates of pay;
• maximum work periods and minimum rest periods;
• minimum paid annual leave;
• the conditions of hiring out workers through temporary work agencies;
• health, safety and hygiene at work;
• equal treatment between men and women.

Who does the PWD affect?

The directive applies to people temporarily working abroad, which may include business travellers. This can be difficult as business travellers tend to have a shorter lead time and travel more often than true posted workers. This makes compliance with the directive more challenging for businesses with employees who travel regularly for work and demands increased data and tracking.

According to the European Commission’s Practical Guide on Posting, workers who are temporarily sent to another Member State without providing services there are not considered posted workers (e.g. when attending a meeting or conference abroad).

However, in the case of true cross-border work-related activities, the employer must notify their home Member State in advance to obtain the portable document AD (PD A1). This obligation is valid for all business travellers no matter the length of their trip or the purpose of their travel. Compliance with the PWD in a business travel context can be complex for employers, however it is here to stay which is why Mobilexpense has developed solutions for PWD compliance.

What are practical considerations of the PWD for companies?

The PWD imposes strict requirements on employers such as prior notification of postings and tracking of international postings as well as appropriate storage and management of social documents (payslips, timesheets, contracts). In organisations without adequate processes and governance, this increased level of compliance can prove additionally challenging.

This is especially true for companies with regular business travellers as the PWD requirements are enforced differently in the Member States.

How Mobilexpense helps you fulfill PWD requirements

Implementing pre-trip approval automation for business travel in Mobilexpense allows for the identification of posted worker A1 obligations prior to travel.

Mobilexpense sends a notification email with the details from the pre-trip approval to facilitate the issuing of the posted worker A1 form by the organisation’s HR department.

A1 registration is also possible via SAP HCM, or as an alternative external suppliers such as CIBT Visa, Visumpoint and Sapere Aude can be mandated to take care of your PWD and A1 requirements.