Framework agreement on cross-border telework
Do you have employees who work from home abroad?
If so, it is wise to check in which country they should/could be socially insured!
MAIN RULES CROSS-BORDER WORK AND SOCIAL INSURANCE
According to the main rule of cross-border social security, an employee is socially insured in the country where he works (country of employment principle). Under certain conditions, he can nevertheless remain socially insured in his country of residence, for example if he works more than 25% of his total working time there.
EXCEPTION FOR WORKING AT HOME ABROAD
Due to the massive increase in remote work from home, also called teleworking, an important exemption was added to the main regulation with regard to social insurance. Within the EU, a framework agreement was published in 2023 that was signed by many countries (the Netherlands, Belgium and Germany, among others).
CONDITIONS FOR THIS EXCEPTION
Thanks to this agreement, a cross-border worker who works from home can still be covered by social insurance in the country in which his employer is based, if all of the following conditions are met:
- The cross-border worker spends less than 50% of their total working hours working from home in their country of residence over a period of 12 months; and
- The cross-border worker and their employer have agreed jointly that the exemption applies (if they fail to do so, the employee will, based on the main regulation, be covered by social insurance in their country of residence if they spend more than 25% of their hours working there); and
- The agreement and its subsequent approval apply for a period of 3 years (this period may be extended); and
- An application has to be filed with the competent social insurance institution in the country in which the employer is based; and
- The agreement has to be ratified by means of a so-called A1 certificate, which is issued by the above-mentioned social security institution if the application meets the requirements.
WHERE CAN YOU SUBMIT AN APPLICATION?
If you are based in the Netherlands, you can apply here, possibly for several employees at once: https://www.svb.nl/nl/id/u-werkt-in-meerdere-landen/uitzondering-op-de-europese-aanwijsregels-aanvragen-voor-bedrijven
If you are based in Belgium, you can submit an application here: https://www.socialsecurity.be/site_nl/employer/applics/gotot/index.htm
IN WHICH COUNTRIES CAN YOU INVOKE THIS EXCEPTION?
In the following link you can see which countries all “participate” in the exception as allowed under the Framework Agreement: https://socialsecurity.belgium.be/nl/internationaal-actief/grensoverschrijdend-telewerk-de-eu-de-eer-en-zwitserland
DO YOU NEED HELP?
If you can no longer see the wood for the trees due to the various recent legislative changes and have doubts about your employee’s correct tax and/or social security status? And whether it has been processed correctly in your payroll records? Then do not hesitate to contact us for an analysis.
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Since 1972, Interfisc has offered international HR & Payroll solutions in the Netherlands, Belgium, Germany, France, the United Kingdom, and Italy. We do this from our offices in the Netherlands and Belgium, and with an international team of around 45 committed and caring employees.
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