ARTICLE
14 January 2025

CONVINUS Global Mobility Alert - Week 2.2025

C
CONVINUS

Contributor

CONVINUS is since 2002 the leading specialist in the field of cross-border employment, international employee assignments, and is the only global mobility provider in Switzerland with a comprehensive range of services. Benefit from our unique combination of professionalism and expert know-how as well as the high level of commitment and involvement for clients.
Since joining the EU, Bulgaria and Romania have applied parts of the Schengen legal framework (Schengen acquis), including those related to external border controls, police cooperation and the use of the Schengen.
Switzerland Immigration

Bulgaria / Romania: Checks on persons at the internal land borders with and between Bulgaria and Romania were abolished as of January 1, 2025

Bulgarien / Romänien: Die Personenkontrollen an den Landbinnengrenzen zu und zwischen Bulgarien und Rumänien wurden per 1. Januar 2025 abgeschafft.

Background information:

Since joining the EU, Bulgaria and Romania have applied parts of the Schengen legal framework (Schengen acquis), including those related to external border controls, police cooperation and the use of the Schengen Information System.

On December 30, 2023, the Council adopted a decision to apply - from March 31, 2024 - the remaining parts of the Schengen acquis and to abolish checks on persons at internal air and sea borders.

The Schengen area is the world's largest area for the free movement of persons. It began when border controls between France, Germany, Belgium, the Netherlands and Luxembourg were abolished in 1985. The Schengen area now comprises 29 countries (25 of the 27 member states plus Iceland, Liechtenstein, Norway and Switzerland) and is home to 420 million people. Internal border controls with Cyprus have not yet been lifted and Ireland is not part of the Schengen area.

Controls to be lifted on January 1, 2025:

The controls at the European internal borders with Bulgaria and Romania have now been abolished as a final step at the turn of the year. The two southeastern European countries, which joined the EU in 2007 and were previously only partial members of the Schengen area, were fully integrated into the European Schengen area on January 1, 2025.

Hintergrundinformationen:

Seit ihrem Beitritt zur EU haben Bulgarien und Rumänien Teile des Schengen-Rechtsrahmens (Schengen-Besitzstand) angewandt, einschliesslich derjenigen, die mit den Kontrollen an den Aussengrenzen, der polizeilichen Zusammenarbeit und der Nutzung des Schengener Informationssystems in Zusammenhang stehen.

Am 30. Dezember 2023 hat der Rat einen Beschluss zur Anwendung – ab dem 31. März 2024 – der übrigen Teile des Schengen-Besitzstands und zur Abschaffung der Personenkontrollen an den Luft- und Seebinnengrenzen angenommen.

Der Schengen-Raum ist der weltweit grösste Raum des freien Personenverkehrs. Begonnen hat es damit, dass 1985 die Grenzkontrollen zwischen Frankreich, Deutschland, Belgien, den Niederlanden und Luxemburg aufgehoben wurden. Der Schengen-Raum umfasst inzwischen 29 Länder (25 der 27 Mitgliedstaaten sowie Island, Liechtenstein, Norwegen und die Schweiz), und ihm gehören 420 Millionen Menschen an. Die Kontrollen an den Binnengrenzen mit Zypern sind noch nicht aufgehoben, und Irland ist nicht Teil des SchengenRaums.

Aufhebung der Kontrollen zum 1. Januar 2025:

Die Kontrollen an den europäischen Binnengrenzen zu Bulgarien und Rumänien sind jetzt als letzter Schritt zum Jahreswechsel weggefallen. Die beiden südosteuropäischen Länder, die 2007 der EU beigetreten waren und bisher nur Teilmitglieder im Schengenraum waren, wurden am 1. Januar 2025 vollständig in den europäischen Schengenraum aufgenommen.

Hungary: Very sharp reduction in quotas for employment permits and guest worker permits

Ungarn: Sehr starke Reduktion der Quoten für die Beschäftigungserlaubnis und die Gastarbeitergenehmigung

Hungary has reduced its combined quota for residence permits for employment purposes and residence permits for guest workers by almost 50 percent from the previous 65,000 to a new total of 35,000. This policy change - which aims to protect domestic workers in the Hungarian labor market - will significantly limit employers' ability to hire foreign talent. Some companies may have to fundamentally rethink and adapt their talent management practices.

Ungarn hat seine kombinierte Quote für die Aufenthaltserlaubnis zu Beschäftigungszwecken und die Aufenthaltserlaubnis für Gastarbeiter von zuvor 65.000 um fast 50 Prozent auf neu insgesamt 35.000 gesenkt. Diese Änderung der Politik - die darauf abzielt, einheimische Arbeitnehmer auf dem ungarischen Arbeitsmarkt zu schützen - wird die Möglichkeiten der Arbeitgeber, ausländische Talente einzustellen, erheblich einschränken. Einige Unternehmen werden ihr Talentmanagement möglicherweise grundlegend neu überdenken und anpassen müssen.

Sweden: With effect from January 1, 2025, Sweden has introduced relaxed rules for the EU Blue Card

Schweden: Mit Wirkung zum 1. Januar 2025 hat Schweden gelockerte Regeln für die Blaue Karte EU eingeführt

The most important changes include:

  • Lower minimum wage thresholds
  • Lower requirements for the duration of the job offer
  • Extended eligibility
  • Relaxed pathways to long-term mobility and
  • d Relaxed rules for changing jobs.

These reforms are part of Sweden's measures to meet the requirements of the EU Blue Card Directive 2021.

Zu den wichtigsten Änderungen gehören unter anderem:

  • Niedrigere Mindestlohnschwellen
  • Geringere Anforderungen an die Dauer des Arbeitsangebots
  • Erweiterte Anspruchsberechtigung
  • gelockerte Wege zur langfristigen Mobilität und
  • gelockerte Regeln für den Arbeitsplatzwechsel.

Diese Reformen sind Teil der Massnahmen, mit denen Schweden die Anforderungen der EU-Richtlinie über die Blaue Karte 2021 erfüllt.

Switzerland's network of agreements around social insurance

FRIEDERIKEV.RUCH, CONVINUS

A key aspect of international employee assignments is the assessment of the employee's social security status

To this end, bilateral agreements have been concluded between the various countries or agreements have been concluded with several countries, such as the Agreement on the Free Movement of Persons or the EFTA Convention. The number of countries with which Switzerland has concluded an agreement is still quite manageable and is relatively small compared to the number of double taxation agreements concluded by Switzerland.

The following overview as of 1 January 2025

1568170.jpg

What does this mean for international employee assignments?

In principle, the agreements allow an employee on assignment in another country not to be subject to compulsory social security in the country of assignment, but to remain insured in their country of origin. This is intended to avoid gaps in contributions and possible negative effects on pension benefits as far as possible.

Of course, certain rules must also be observed when using an agreement. These include, for example, the fact that the employee must have been insured in the country of origin prior to the assignment abroad. However, the law does not specify how long the prior insurance coverage must be, but it should generally be at least 4 weeks.

Bilateral agreements

For example, there is a bilateral agreement between Switzerland and the USA. If an employee of a Swiss company is posted to the USA for two years, they can remain subject to social insurance in Switzerland on the basis of the existing social insurance agreement. This means that the assignment in the USA has no negative impact on their Swiss "social security career".

However, as the bilateral agreements do not generally cover all classes of insurance, this also means that in the country of assignment, in this case the USA, the employee cannot be exempt from all classes of insurance in the USA. This then leads to additional social security contributions. As a rule, these contributions are also paid by the employer. Accordingly, these contributions must also be taken into account for the calculation of tax and social security contributions as a monetary salary component.

It should also be mentioned that the nationality of the employee is irrelevant for the application of the social security agreement. The agreements generally allow for posting periods of up to a maximum of 5 or 6 years. However, this is regulated differently depending on the agreement.

Multilateral agreements

The two most frequently used multilateral agreements in Switzerland are the Agreement on the Free Movement of, which governs postings between Switzerland and an EU member state, and the EFTA Convention, which regulates postings between Switzerland and an EFTA state.

In contrast to the bilateral agreements, however, nationality plays a role here. This means that the Agreement on the Free Movement of Persons can only be used for Swiss or EU nationals. The EFTA Agreement only applies to Swiss or EFTA nationals.

The period of utilization is also fundamentally limited. Both the Agreement on the Free Movement of Persons and the EFTA Agreement only allow for a period of up to 2 years. However, it is possible to extend this to a maximum of 5 or 6 years (in accordance with the bilateral agreements), provided that an exceptional agreement can be reached. As is an exceptional agreement, both countries involved in a posting must agree to this and there is no legal entitlement.

The scope of insurance in both agreements (Agreement on the Free Movement of Persons and EFTA Agreement) covers all branches of insurance. Accordingly, the employee can remain fully insured in the country of origin and be fully exempted from the social security obligation in the country of assignment.

To view the full article click here

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.

Mondaq uses cookies on this website. By using our website you agree to our use of cookies as set out in our Privacy Policy.

Learn More