EU Directive 2018/957: Posting of workers in the framework of the provision of services
By 30 July 2020, EU Member States must comply with the provisions of the new EU Directive 2018/957 of 28 June 2018 on the posting of workers in the framework of the provision of services.
The Directive, which amended and updated Directive 96/71/EC of 16 December 1996, obliges multinational companies that assign employees to other EU countries to ensure equal economic and regulatory treatment, trying to counter social dumping.
From an operational point of view, the provisions of the Directive provide for the adaptation of the wage package of posted workers and working conditions, after the first 12 months of posting, which can be extended – with a reasoned request to be forwarded to the competent authorities – for a further 6 months up to a maximum total duration of the posting of 18 months.
In addition to wage dumping, the objectives pursued are to ensure a level playing field and protect the rights of posted workers.
To date, foreign companies posting workers to Italy are obliged to communicate the following information to the Ministry of Labour electronically by midnight on the day before the start of the posting:
- the identification data of the posting company;
- the identification data of the seconding company;
- the number and particulars of posted workers;
- the start and end date and the total duration of the posting;
- the place of performance of the work;
- the type of services and contact details of the posting company.
Any changes to the terms of the posting must be notified within 5 days.
Directive no. 2018/957 obliges posting undertakings to guarantee the worker, once a 12-month assignment period (extendable up to 18 months) has been exceeded, all the terms and conditions of employment applicable in the host Member State where the work is carried out, in accordance with the provisions of law, regulations or administrative provisions or deriving from national collective agreements. In particular, the new rules provide for the application of the following elements:
A) maximum working periods and minimum rest periods;
B) minimum duration of paid annual leave;
C) pay, including overtime rates;
D) conditions of hiring-out of workers, in particular the hiring-out of workers by temporary employment agencies;
E) safety, health and hygiene at work, etc.
F) equal treatment between workers of different sexes and other non-discrimination provisions;
G) accommodation conditions for workers where this is provided by the employer to workers away from their normal place of work;
H) allowance or reimbursement to cover travel, board and lodging expenses for workers away from home for professional reasons.
In order to make it easier for posting companies to know the terms and conditions of employment applicable in the country of destination, the Directive in question provides for the establishment in each Member State of a single national portal, which must be kept up to date and where the constituent elements of remuneration and other terms and conditions of employment applicable to the posted worker must be published.
The new Directive reaffirms the temporary nature of the secondment and provides that, after the first 12 (or 18) months of secondment, the posting company’s payroll, salary payments, accommodation-related emoluments and allowances or reimbursement to cover travel, board and lodging expenses must be integrated into the payroll.
The Directive also defines that: “Specific allowances for secondment shall be considered as part of remuneration, provided that they are not paid to reimburse expenses actually incurred as a result of the secondment, such as travel expenses, food and accommodation. […] Where the terms and conditions of employment applicable to the employment relationship do not determine whether elements of the specific allowance for secondment are paid by way of reimbursement of expenses actually incurred as a result of the secondment or whether they form part of the salary and, if so, what those elements are, the entire allowance shall be deemed to be paid by way of reimbursement of expenses”.
Procedures, formalities and conditions for the conclusion and termination of employment contracts, including non-competition clauses and supplementary pension schemes, remain excluded from the scope of the Directive.
Social security aspects
On this subject, it should be noted that equal treatment does not affect social security aspects, which remain governed by Regulation No 883/2004 and its implementing Regulation No 987/2009.
A worker posted to an EU country will be able to continue to pay social security contributions in his or her country of origin for the first 24 months, which can generally be extended subject to authorisation by the competent social security authorities of the countries involved.
It remains to be verified the connections between the maximum period of posting provided for by EU Directive 2018/957 and the above-mentioned Regulations.
The new rules will have to be implemented by Member States by 30 July 2020, as provided for in Article 3(1) of the Directive.
The Italian Parliament, with Law No. 117 of October 4, 2019 (which came into force on November 2, 2019) has established that the Government is delegated to adopt the legislative decrees for the implementation of EU Directive 2018/957 within the transposition deadline indicated by the Directive itself.
At the date of publication of this infoflash, no legislative decree had been adopted in this regard.
LDP Payroll remains at your disposal for any further clarification.
Arianna De Carlo – email@example.com
Head of Payroll Department