According to Eurofound, “Telework is a work arrangement in which work is performed outside a default place of work, normally the employer’s premises, by means of information and communication technologies (ICT). The characteristic features of telework are the use of computers and telecommunications to change the usual location of work, the frequency with which the worker is working outside the employer’s premises and the number of places where workers can work remotely (mobility).”[1]
This info toolkit covers questions about workers whose employer is registered in one Member State of the European Union, but telework from another Member State. Teleworking from outside of the EU is not covered here.
[1] Teleworking | European Foundation for the Improvement of Living and Working Conditions (europa.eu).
A “posted worker” is an employee who is sent by their employer to carry out a service in another Member State on a temporary basis, in the context of a contract of services, an intra-group posting or a hiring out through a temporary agency.[2] A posted worker is not a teleworker as the reason that they no longer work in the Member State where their employer’s registered office or place of business is located, is because they are being “posted” abroad to complete a specific project or mission.
Unlike a posted worker, a teleworker continues to work fully for the employer, but performs the work remotely in a Member State other than the Member State in which their employer is located, typically for personal convenience.
[2] Posted workers – Employment, Social Affairs & Inclusion – European Commission (europa.eu).
James is employed as a construction engineer in Belgium. His employer recently won a large construction contract in Spain and proposes to send James to Spain for a period of six months to work on the contract there. In these circumstances, James will be treated as a posted worker.
Marc is employed as a design engineer with the same company in Belgium. Marc wants to move to Slovakia with his Slovakian wife, while remaining in the employment of his Belgian employer by working remotely from Slovakia. In these circumstances, Marc will be treated as a teleworker.
The general rule is that an employee who works in more than one Member State, but carries out “a substantial part” of their professional activities in their country of residence, is covered by the social security system in the country of residence[3].
The indicative factors for a ”substantial part” of an employee’s activities are at least 25% of working time and/or income over a reasonable period [4]. This threshold is established in EU law and applies in all Member States, though Member States may not apply this assessment in a fully harmonised manner. In particular:
For instance, if an employee performs “a substantial part” (i.e., at least 25%) of their professional activities in the Member State where their employer’s registered office or place of business is located, but also teleworks in one or several other Member States for the remaining 75% of the time, the employee remains subject to the social security system of their employer’s Member State.
If, however, an employee usually carries out “a substantial part” of their activities in the Member State where they are resident, and only occasionally teleworks in the Member State where their employer is located, the employee will be covered by the social security scheme of the Member State of residence.
For example, if an individual is employed in Spain and teleworks less than 25% of the time in Portugal, they will remain covered by Spanish social security. However, if 60% of the employee’s professional activities are performed in Portugal, the Portuguese social security system will apply.
[3] Article 13(1)(a), Regulation (EC) No. 883/2004.
[4] Article 14(8), Regulation (EU) No. 987/2009. The assessment is carried out prospectively on the basis of the following 12 months (Regulation (EC) No. 987/2009, Article 14(10)).
Felix resides in France where he works three weeks per month from home as an accountant for a firm based in Luxembourg. He works at his employer’s office in Luxembourg for the remaining week. As Felix carries out a substantial part of his professional activities (three weeks per month) in France, his country of residence, he will be covered by the French social security system rather than that of Luxembourg.
Julia is an architect who resides in Latvia. She works as a business development manager for a large construction firm based in Estonia, where she generally spends less than one week per month. She spends the remainder of her time between Latvia and Lithuania, working approximately twelve days per month in each. In these circumstances, Julia will be covered by the Latvian social security system.
Max resides in France on the border between France and Belgium. He works as a clinical researcher for a pharmaceutical company based in Belgium. He works in his Belgian employer’s laboratory two or three days per week and spends the remainder of his working week in laboratories throughout Germany and the Netherlands. As Max performs at least 25% of his employment activities in Belgium where his employer is located, he will be subject to the Belgian social security system.
No, based on the rules described above, only one Member State’s social security legislation can apply to a teleworking employee at a time. A teleworker cannot be covered by, or subject to, social security legislation in two different Member States.
It depends. Form A1 [5] is not required for short periods of telework; a European Health Insurance Card (“EHIC”) is sufficient. However, if telework becomes regular and represents a substantial number of days per year, the employer/employee must apply for a Form A1.
[5] A Form A1 is a document that states in which Member State a worker's social insurance premiums are paid. Without a Form A1, an employee cannot work in some countries.
Lucia resides in Italy where she has recently taken up a position with an Austrian employer as a designer. She will telework in Italy approximately four days per month and spend the remainder of her working time in the Austrian office. As this is a permanent position, Lucia should obtain a Form A1 from Austria for presentation to the social security authorities in Italy to ensure that she can avail of social protection there and avoid paying social insurance contributions in more than one country.
Christos resides in Greece with his Irish wife and their two sons. He is employed as an economist. He proposes to spend three months in Ireland with his wife and sons during which he will continue to work remotely for his Greek employer. As the period for which teleworking is proposed by Christos is short, he can rely on his European Health Insurance Card in Ireland rather than apply for a Form A1.
A series of measures have been taken by the European Commission to facilitate more digital social security coordination.
Not yet. However, with the future introduction of EU Digital Identity, we can expect digital versions of documents, such as the EHIC.
If a teleworker spends more than 25% of their time in a Member State other than the one in which they are employed, the applicable social security legislation shifts to the country where they spend that time.
Dominik resides in Hungary with his partner. He is employed as a software developer with an employer based in Belgium. Dominik attends the office in Belgium two days per month and works for the remainder of the time from his home in Hungary. As Dominik spends more than 25% of his time in Hungary rather than in Belgium, he is covered by Hungarian social security.
Yes, if an employee becomes subject to a foreign social security scheme (i.e., social security legislation in a Member State other than the one in which the employer is registered/located), the employer is required to register in that Member State and pay social security contributions there.
Ilsa currently resides in Spain where she works as a web designer. She proposes to move to Finland to live with her new wife but continue to work for her Spanish employer. She will return to the office in Spain only one day per month. In these circumstances, if her employer permits Ilsa to continue working for them in Finland, they are required to register in Finland and pay social security contributions there. If these are not paid when they are due, the employer may be liable to fines, interest and penalty surcharges. Some employers are aware of this and do not permit teleworking.
Ilsa’s employer cannot be obliged to have an address (e.g. an office) in Finland. In practice, however, it is quite common for an employer to have an office from which social security contributions are paid in the State in which personnel are employed. If Ilsa is the only employee in Finland, for the sake of convenience, her employer may ask her to assume responsibility for the payment of contributions. Although such an arrangement may sometimes simplify administrative procedures, it is voluntary and cannot be enforced. It also does not change the responsibility and obligations of Ilsa’s employer to inform the competent institution in Finland and guarantee the payment of the contributions.
Yes, since July 2023, there is a new multilateral framework agreement for cross-border teleworking (“Framework Agreement”)[6]. The countries that signed the agreement are listed here.[7] The Framework Agreement covers the EEA Member States and Switzerland.
[6] Framework Agreement on the application of Article 16 (1) of Regulation (EC) No. 883/2004 in cases of habitual cross-border telework.
[7] Signatory States as of February 2024: Austria, Belgium, Croatia, Czech Republic, Finland, France, Germany, Italy, Liechtenstein, Luxembourg, Malta, Netherlands, Norway, Poland, Portugal, Slovenia, Slovakia, Spain, Sweden and Switzerland.
The Framework Agreement applies to employees in a cross-border situation, i.e., those who work for an employer located in one Member State while living and working in another Member State, provided certain conditions are met. Both Member States must have signed the Framework Agreement.
The Framework Agreement allows teleworkers to be insured for social insurance purposes in the country of their employer, provided both the employer and employee/teleworker agree. This option is available to employees who spend more than 25% but less than 50% of their working time in the Member State of residence but spend the majority of their working time in the Member State where the employer is established.
In essence, the Framework Agreement establishes an exception to the regular coordination rules which provide that teleworkers (and their employers) are subject to the social security scheme in the employee’s country of residence, provided the employee performs a “substantial part” of their professional activities (i.e., at least 25% of working time or income) in that country, as noted above. This rule allows teleworkers to increase the amount of time spent in the country of residence without creating obligations for the employer in another Member State to pay social security contributions in that country.
Karl currently works as a lawyer in Germany where he resides. He plans to move to Switzerland to live there with his partner and proposes to work remotely for his German employer. He will work approximately twenty days per month in the German office and the remaining ten days from his new home in Switzerland. In these circumstances, as Karl will spend more than 25% but less than 50% of his working time in Switzerland and the remainder in Germany, he can remain covered by the German social security system. This avoids his employer having to register in Switzerland and pay social security contributions there.
A teleworker will be eligible to be socially insured in the Member State where their employer is established rather than in their Member State of residence, as permitted under the Framework Agreement, only if certain conditions are met. These conditions, which are cumulative, are as follows:
Note that the Framework Agreement applies only to “teleworkers”: employees must remain connected to the employer’s working environment through a digital link (IT connection) during the performance of their work. The Framework Agreement is not limited to telework at home; the work can be performed anywhere in the country of residence, as long as a digital connection is used.
If the conditions above are met, the employer/employee must apply for a Form A1, which serves as proof that the social security legislation of the employer’s Member State is applicable. An application for a Form A1 must be made in the Member State where the employer is established.
Maria currently resides in Portugal where she works as a copy editor. She proposes to return home to Malta to look after her aging mother and wishes to telework there for her current Portuguese employer. When she approached her employer to request authorization to telework from Malta, the employer was reluctant to grant permission to her as they were concerned about the formalities with which they would be required to comply in Malta to ensure social security cover for Maria there. However, under the Framework Agreement, if Maria and her employer can agree that she will work more than 25% and less than 50% of her working time in Malta and work for the remainder of the time in Portugal (50%+), it will not be necessary for her employer to register in Malta and pay social security contributions there. Maria should apply for a Form A1 In Portugal to present to the social security authorities in Malta to avoid paying social insurance contributions in more than one country.
The Framework Agreement has applied from 1 July 2023. Applications for a Form A1 filed before 1 July 2024 can have retrospective effect only until 1 July 2023 (or until the date on which the signatory Member State signed the Framework Agreement, if after 1 July 2023), provided that social security contributions have been paid in the Member State in which the employer is established. After this transitional period (the year ending 1 July 2024), an application for a Form A1 can have retrospective effect only for up to three months.
Income tax is not regulated at EU level. The rules on income tax applicable to cross-border workers (i.e., teleworkers or posted workers) are contained in bilateral agreements between the Member States.
Some countries impose an income tax reporting obligation, even if no taxes are due. Each bilateral agreement provides specific information on what to report. Generally, a teleworker’s worldwide income (including income received in countries other than the country of residence) should be reported.
Not generally, because in such a case, the country of residence and the country where the work is performed are the same.
Luka is a Croatian citizen based in Dubrovnik who works as a designer for a company based in Zagreb. He attends the Zagreb office once per month. In these circumstances, Luka’s country of residence and that where the work is performed are the same. Luka will not be considered a cross-border worker for income tax purposes.
Note that since the income tax obligations applicable to teleworkers depend on bilateral agreements between signatory States and are not governed by EU law, a specific analysis must be undertaken of the Member States concerned. EU Member States frequently draw inspiration from the OECD’s Model Tax Convention[8], according to which employment income is taxable in the place of activity, i.e. where the work is performed. However, tax law, particularly cross-border tax law, is a complex area requiring expert advice that goes beyond the scope of this toolkit.
[8] Model Tax Convention on Income and on Capital 2017 (Full Version) | en | OECD
The labour laws of the Member State in which the employer is established apply to teleworkers. Generally, the employment contract between the employer and the employee will confirm that this is the case.
Mary is an Irish citizen who is currently teleworking in Ireland for a German company. She has been advised that she is to be made redundant. She is unsure whether she will be subject to Irish or German law in relation to her redundancy rights. In these circumstances, in the absence of any provision to the contrary in her employment contract, as Mary’s employer is based in Germany, German employment law will apply to her redundancy.
No, teleworkers can be subject only to the labour legislation of only one Member State at a time.
No, a posted workers declaration is required only for situations where an employee is being sent abroad by the employer for a specific mission, as described above.
After three months of residence in another Member State, it is compulsory in most Member States for an individual to register with the local authorities. Further information per country can be found here.
Mateo is a Spanish national who works as an interpreter. He plans to move to Belgium to be with his Belgian boyfriend and to telework from Belgium for his Spanish employer. He will be required to register his residence with the municipality of the place where he is staying in Belgium within three months of his arrival there.
Yes. In such a case, the non-EU family member (i.e., the teleworker) will need to register in the host Member State to obtain a residence card as a family member of EU national who is also resident there. It is compulsory for a non-EU family member to register their stay of more than three months.
Li is a Chinese national married to Sean who is an Irish citizen. The couple plan to move from Ireland to the Netherlands where Sean has been offered a job. Li proposes to telework in the Netherlands for her employer who is based in Ireland. Li will be permitted to work in the Netherlands without the need to apply for an employment permit but will be required to apply for a residence card within three months of her arrival there.
Non-EU family members of EU nationals benefit from the same rights as EU nationals if residing with the EU national in the same Member State. In practice, this arrangement means that non-EU national family members are not subject to work permit formalities when they reside in the same Member State as their EU family member.
However, if a non-EU family member decides to telework on their own in another Member State (i.e., not accompanied by their EU family member), their right of residence is no longer linked to their status as a family member of an EU national. In this case, the answer to the question above is “no”: if a non-EU family member of an EU national teleworks for more than three months in another Member State without being accompanied by an EU family member, they are required to apply for a work/residence permit in the host Member State.
Beatriz is a Brazilian national married to Noah who is a Belgian citizen. The couple live in Germany. If they both move to France, Beatriz can telework for a German employer in France without the requirement to obtain an employment or residence permit, though a residence card will be required. However, if Noah remains in Germany while Beatriz decides to telework in France, she will lose her rights as a family member of an EU citizen. In this situation, Beatriz will be required to obtain both an employment and residence permit to remain and work in France.
This info toolkit covers questions relating to social security, tax, labour law, and immigration in respect of teleworking within the European Union (“EU”), where the employer is registered in one EU Member State but the employment is carried out by the worker in another EU Member State using Information Technology.
