Global Employer Services News July 2021

Substantial activities in EU/EEA countries

A recent case the Court of Justice of the European Union gave judgement on regarding a Bulgarian temporary work agency has brought into question the concept of ‘substantial activities’. More specifically what work is determined as ‘substantial activities’ when it comes to obtaining A1 certificates and maintaining an employee’s social security in their home country while on a temporary assignment in an EU/EEA country.

In this case, the temporary work agency was recruiting employees in Bulgaria for work that would be carried out in Germany. The employees were agency workers and were therefore not direct employees of the agency.

The Court determined, in this case, that the work carried out by the temporary work agency in Bulgaria did not, in regards to the recruitment process, constitute as ‘substantial activities’ however sending the employees on assignment did as this is what generated turnover for the company.

Employers should consider this new judgment by the Court when working to recruit agency workers to be posted in EU/EEA countries going forward.

Any questions, please do reach out to your BDO representative.

Stuart Strong