ECJ hearing in C-610/18 AFMB- Freedom of movement of employment contracts

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Sep 18, 2019
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1 Case in the main proceedings

AFMB is a” flexible and internationally operating organization based in Cyprus”. AFMB assists “internationally operating road hauliers in improving their competitive position”, by means of working with them to see how European regulations can be applied as favorably as possible for their company” (http://www.afmb.eu).

Drivers are recruited in the Netherlands, by a transport company located in the latter country. That transport company exercises effective control over the drivers and bears the wage cost. However, employment contracts are concluded with AFMB Cyprus (alternatively transferred to AFMB), company which by virtue of a fleet management agreement concluded with the transport company, pays wages, and pays social security contributions in Cyprus.

2 AFMB position

The AFMB position can be summarised as follows: the above-mentioned scenario occurs “as a natural consequence of the single market”.

The AFMB invokes the following pleas in law:

  • Article 45TFEU (freedom of movement of workers)-although, in certain cases, only employment contracts have “moved” to Cyprus
  • Article 56TFEU (freedom to provide services)
  • Regulations 883/2004 and 987/2009 coordinate but not harmonise social security systems
  • Low social security contributions are not “equivalent” to low social protection
  • A dual definition of the concept of employer under social security regulations and labour law, would generate legal uncertainty

The employer is AFMB.

3 Other common positions

  • The concept of employer must be given an autonomous definition under the social security coordination regulations
  • Such a definition must consider the actual and factual employment situation, notably the principle of “the closest link”  
  • Regarding the interpretation of Article 13.1 (b) (i) Regulation 883/2004, the Commission recalls Part II point 7 Practical guide The legislation that applies to workers in the EU, the EEA and Switzerland: “How to determine the registered office or place of business”

The employer is the transport company located in the Netherlands.

4 UK written submission

  • The employer is AFMB
  • AFMB’ place of business in the sense of Article 13.1(b) (i) Regulation 883/2004 is the Netherlands.

5 The French ancillary pleading

The French government pleads (as well) for a convergence of the concepts of employer under labour law and social security coordination, while maintaining a clear distinction between these legal instruments.

Where the French government’s position regarding the (suitable) duality of the definition of posted worker was clearly brought by political and judicial means, the ancillary pleading must be considered in its “global context”.

 

 

 

 

 

 

 

 

Go to the profile of Tanel Feldman

Tanel Feldman

Senior Partner , Immigration Law Associates

Immigration Law Associates provides services in the following areas of law: A- INTRA-EU MOBILITY -European Union Services: A1 Freedom to provide services : Social security and labour law -intra-EU mobility of employed and self-employed workers A2 Freedom of movement of persons : a) Citizenship of the Union and Member State nationality b) Entry and residence rights from the Citizens’ Rights Directive-c) Freedom of movement of workers B LEGAL MIGRATION- Belgium and Luxembourg : corporate and private immigration

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