As of 30th Of July 2020, the Czech Republic introduced stricter rules for the posting of workers in the framework of the provision of services in accordance with the updated text of the relevant European directive. The following article provides an overview of the most important changes in the updated directive.
In 2018, the EU adopted Directive (EU) 2018/957 amending Directive 96/71/EC concerning the posting of workers in the framework of the provision of services. This update brings in particular:
- tightening and expanding the conditions that the employer is obliged to ensure for its employees posted to an EU Member State for the purposes of providing transnational services,
- time limit for small-scale posting under minimum conditions for 12 months (or 18 months upon request),
- changes in administrative procedures.
It is a next step towards equality of terms and conditions between local and foreign workers and service providers in order to protect more developed markets.
With the implementation of the new rules, more oversight by competent local authorities can be expected.
Tightening of applicable working conditions for posting up to 12 months (short-term)
In the case of a short-term posting to an EU Member State, more favorable conditions for the given worker are being tested. The conditions that are included in the test are newly expanded, especially in terms of remuneration.
The conditions that have been so far applied:
- maximum working hours and minimum rest periods,
- minimum paid leave per calendar year,
- minimum remuneration, including overtime rates,
- protection of health, safety and hygiene at work,
- equal treatment and non-discrimination.
In addition to the minimum and guaranteed remuneration, all mandatory components of remuneration stipulated by national legal and administrative regulations or collective agreements are now added to the minimum standard, based on the principle of “equal pay for equal work”.
As compared to the previous situation, the Czech Republic will now also apply the rules for work on national holidays, night work, work in difficult working conditions or work on weekends and extra pay for work on national holidays or weekends.
Furthermore, similar lodging conditions, if the employer provides lodging to its employee, and reimbursement of travel expenses, if the posted worker is required to travel to and from his regular place of work in the host EU Member State, are added. In the Czech Republic, it would be e.g. a situation where a posted worker usually works in Brno but temporarily travels to Liberec to work.
Tightening of applicable working conditions for posting exceeding 12 months (long-term)
In the case of a posting exceeding 12 months, all working conditions of the host EU Member State will apply to the posted worker, with the exception of conditions of the conclusion and termination of the employment contract, including non-competition clauses, and the supplementary occupational retirement pension schemes.
For the sake of completeness, we would like to mention that the 12-month time limit has nothing to do with social security regulations, where the maximum posting period is still 24 months.
Changes in notification duty and other administrative procedures
The European Directive on the posting of workers requires EU Member States to establish the requirement to notify postings, which the Czech Republic meets.
As of 31st Of July 2019, the Czech Republic made a change in the notification duty for posted workers in terms of who has the notification duty. This duty has passed from the service recipient (Czech customer) onto the service provider (foreign supplier). The service provider is now obliged to notify the competent branch of the Labor Office about the posting no later than on the first day of work of the posted worker.
As of 30th Of July 2020, the notification duty for the posting of workers has been further specified and in our opinion, tightened.
Based on our experience, no notification was practically required up until 30th Of July 2020 in the case of a very short provision of services (e.g. one-day repair of a machine by a German company in a Czech company). It is possible that this notification duty will be tightened based on the amended text of the law and that the Labor Office will now monitor and require notification in such cases as well.
The updated directive also requires EU Member States to reinforce their cooperation, information exchange and oversight. Therefore, we would like to recommend monitoring this area closely in the case of posting or receiving workers.
Implementation of the updated directive in neighboring EU Member States
As of 30th Of July 2020, Germany and Slovakia also implemented the new conditions laid down in the directive. In Poland, a relevant bill is waiting for its approval.
The expansion of the applicable conditions considerably varies in each EU Member State due to the diversity of its labor laws. This is why, increased attention needs to be paid to this area.