European Union - EU Framework Agreement on Cross-border telework enters into force

The EU’s Administrative Commission for the Coordination of Social Security Systems in April 2023 agreed on a framework agreement to determine the applicable social security legislation for certain cross-borders teleworkers in the EU. For prior coverage, see our alert in the May 2023 edition of BDO’s Global GES newsletter.

That agreement entered into force on 1 July 2023 for the 18 countries that had signed the agreement as of 30 June 2023:  Austria, Belgium, Croatia, Czech Republic, Finland, France, Germany, Liechtenstein, Luxembourg, Malta, the Netherlands, Norway, Poland, Portugal, the Slovak Republic, Spain, Sweden and Switzerland.

The agreement allows employers and employees to choose to maintain social security coverage in the employer’s country when an employee works from home in another country less than 50% of the working time.

Other countries have indicated that they will sign the agreement at a later stage. For those countries, the framework agreement will take effect on the 1st of the month following their signature.

As of this writing, the UK is the only country that has formally stated that it will not sign the new framework agreement.

The framework agreement is valid for a period of five years and it will be automatically extended at the end of each period for for another five years.

If you would like to understand the impact of these new rules on your mobile workforce in general and cross-border commuters in particular, please reach out to your regular BDO contact and we would be pleased to provide assistance.

Peter Wuyts
BDO in Belgium

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