European Union: Revision Of European Posting Of Workers Directive Approved

In 1996, Directive 96/71/EC concerning the posting of workers in the framework of the provision of services (the "Posting of Workers Directive") established that, even though workers who are temporarily posted to another Member State to perform work in that country are still employed by the sending company and therefore subject to the law of that Member State, they are entitled by law to a set of core rights (such as minimum rates of pay, maximum work periods and minimum rest periods, minimum paid leave, health, safety and hygiene at work, etc.) in force in the host Member State.

On 8 March 2016, the European Commission presented a targeted revision of the Posting of Workers Directive seeking to facilitate the provision of services across borders within a climate of fair competition and respect for the rights of posted workers. Fair competition implies fair wage conditions and a level playing field between posting companies and local companies in the host Member State.

On 21 June 2018, the Council of the European Union and the European Parliament adopted the Directive amending the Posting of Workers Directive (the "Revised Posting of Workers Directive").

The Revised Posting of Workers Directive will enter into force 20 days after its publication in the EU Official Journal. Member States will have two years to implement the Directive into local legislation.

The key changes in the Revised Posting of Workers Directive can be summarised as follows:

Equal Remuneration for Posted Workers

Before the adoption of the Revised Posting of Workers Directive, posted workers were only entitled to the same minimum wage as national workers. By contrast, under the new rules, posted workers will be entitled to the same remuneration as local workers for the same work at the same place. The concept of remuneration must be determined by the national law and/or practice of the host Member State and must include all constituent elements of remuneration rendered mandatory by national law, regulation or administrative provision, or by collective agreements and not only the minimum rates of pay.

When comparing the remuneration paid to a posted worker and the remuneration due in accordance with the national law and/or practice of the host Member State, the gross amount of remuneration should be taken into account. Allowances specific to the posting may be included in the comparison, unless they cover expenses actually incurred on account of the posting, such as travel, board and lodging. The employer must reimburse such expenses in accordance with the national law and/or practice which applies to the employment relationship. If the conditions applicable to the employment relationship do not determine which elements of the allowance covers expenses and which are part of the remuneration, the entire allowance is considered to cover expenses actually incurred on account of the posting.

Equal Allowances for Travel, Board and Lodging Expenses for Posted Workers

Posted workers should also receive at least the same allowances or reimbursement of expenditure to cover travel, board and lodging expenses for workers away from home for professional reasons that apply to local workers in that Member State. The same should apply to the expenditure incurred by posted workers required to travel to and from their regular place of work in the host Member State.

Temporary Agency Workers

The principle of equal treatment also applies to posted temporary agency workers. Pursuant to the Revised Posting of Workers Directive, the service recipient in the host Member State should inform the temporary workers agency regarding the working conditions and remuneration applicable to its own employees.

Universally Binding Collective Bargaining Agreements

In all Member States, industry-wide collective bargaining agreements which are declared universally applicable must also apply to posted workers in all sectors and not only in the construction industry. This is already the case in Belgium.

Long-term Posting

If posting lasts for periods longer than 12 months, the host Member State should ensure that firms which post workers to their territory guarantee those workers an additional set of terms and conditions of employment that are mandatorily applicable to workers in the Member State where the work is carried out, except for the conditions and procedures of the conclusion and termination of the employment contract and supplementary occupational retirement pension schemes. Under strict circumstances, this 12-month period can be extended to 18 months.

Transport Sector

The Posted Workers Directive will continue to apply in the transport sector until the sector-specific European legislation, which is still under negotiation, comes into force.

Although specific modifications of the Revised Posting of Workers Directive already apply in Belgium, employers should bear in mind that the Belgian legislation will be updated in the coming two years in order to be fully compliant with the new rules.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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