The concept of business trip in the context of intra-EU mobility, is one of the most controversial topics debated today.
The debate is often grounded on wrong premises, essentially due to:
- The approach that is taken by mobility managers considering that very short periods of activity carried out in another Member State, must be given in any circumstances, a more favourable treatment than usual activities of temporary nature.
- Lack of clear definition of the concept of “business trip” in the context of intra-EU mobility. National legislations are often silent or confusing in that regard.
- The confusion between on the one hand, social security coordination rules laid down by Regulation 883/2004 and its implementing Regulation 987/2009, and on the other hand, labour law provisions, notably the transposition into national legislations of Directive 96/71/EC and its enforcing Directive 2014/67/EU.
It must be first underlined that regardless any possible definition of the concept, the very reason of a business trip is to immediately or ultimately provide or receive a service in the sense of Article 57 TFEU.
In which situations national labour law and EU social security coordination rules can be disregarded?
When the purpose of the trip is visiting, entertaining, seeing cultural and historical places, doing sports, having fun.
Business trips under EU social security coordination rules
In the current version, the social security coordination regulations, neither provide for a definition of business trips, and nor exclude from their scope short periods of activity carried out in another Member State.
The relevant question is not whether the portable document A1 must be obtained for business trips, but under which article of Regulation 883/2004 it must be applied for (i.e. Article 12.1 or Article 13).
That is another controversial topic. In view of facilitating the decision-making process, the following guidelines must be followed:
As a matter of principle, business trips fail under Article 12 Regulation 883/2004. With simple words, a portable document A1 must be applied for (ideally) before any business trip, regardless its duration and regardless any “in-house” definition of the concept of business trip. Any provision laid down by national labour laws, is irrelevant in the context of social security coordination.
Frequent business travellers fail (beyond doubt) within the application of Article 13 Regulation 883/2004 (multi-state activity) provided that:
- their employment contract contains a mobility clause, or it was amended to contain such a clause.
- attending business trips in different Member States is an intrinsic part of the work pattern and the interval between different business trips is not of such a length or nature to modify the work pattern in a way that a business traveller would no longer be “normally” working in two or more Member States.
It must be recalled that although business trips are often marginal activities (accounting for less than 5% of the worker’s regular working time and/or less than 5% of his/her overall remuneration, assessed for each Member State separately, and cannot be aggregated) ,pursuant to Article 16 Regulation 987/2009, a person who pursues activities in two or more Member States, shall inform the institution designated by the competent authority of the Member State of residence, regardless the working pattern (i.e. regardless if marginal activity is carried out in certain Member States).
A particular attention must be attached to situations in which employees posted under Article 12 Regulation 883/2004, are subsequently sent to frequent business trips from the host country. The applicable legislation might change with retroactive effect.
Lastly, it must be noted that certain competent authorities, are enforcing their own “original” interpretation of the social security coordination rules (e.g. in Slovenia, Article 13 Regulation 883/2004 is applicable exclusively for road transport, assembly and repair activities).
Pursuant to Article 15.1 Regulation 987/2009 , interpreted by settled ECJ case law , portable documents A1 “should preferably be issued before the beginning of the period concerned; it may, however, be issued during this period or even after it has expired, in which case it may have retroactive effect” (see inter alia Banks and Others C 178/97, Format Urządzenia/Montaże Przemysłowe C 115/11, Alpenrind GmbH and Others C-527/16).
However, failure to hold a portable document A1, or at least proof of application lodged, might primarily result in fines imposed under labour law (e.g. in Austria, EUR 1000 to EUR 10000 per employee, and EUR 2000 to EUR 20000 in case of recurrence).
Business trips under labour law
Pursuant to Article 2 Directive 96/71/EC, a posted worker “means a worker who, for a limited period, carries out his work in the territory of a Member State other than the State in which he normally works”.
A business visitor carries out his work, for a limited period in the territory of a Member State other than the State in which he normally works.
A frequently asked question is whether business trips fail under the obligation to send a declaration of posting and/or to comply with the other national provisions transposing Chapter IV Directive 2014/67/EU.
In view of addressing such a question, a frequent error in the assessment of “business trip” cases, is to merely find out the definition of the concept under the national legislation of the host Member State (nature of activities and duration permitted), considering that such activities are “naturally” exempted from the obligation to send a declaration of posting and/or comply with the other national provisions transposing Chapter IV Directive 2014/67/EU.
The way to figure out which activities are exempted from such obligations and the duration covered, is to assess the national law provisions transposing Directive 96/71/EC and its enforcing Directive 2014/67/EU.
Unfortunately, single official national websites (pursuant to Article 5 Directive 2014/67/EU) do not contain clear information regarding activities that are exempted from the obligation to send a declaration of posting and/or to comply with the other national provisions transposing Chapter IV Directive 2014/67/EU. Such information is often either non-existent or confusing, and available only in national language. More ever, in certain cases, to determine the scope of the exemption, different law provisions must be read in conjunction.
Failure to comply might result in significantly high fines imposed under the national legislation of the host Member State.
Pending the ECJ ruling in joint cases C-139/19, C -140/19 and C-141/19, the sky is the limit.
In Austria, failure to keep and make available payslips, in case of recurrence, might result in an administrative fine up to EUR 50.000 per employee. In context, it must be noted that “the general business meting exemption applies only to very short-term activities of up to three days (with an absolute maximum of one week) and is limited to activities cannot be carried out by Austrian employees. Any provision of services to a (direct or indirect) client in Austria is not considering to be a business meeting but is an assignment subject to registration or approval” (Practical Law Global Guide 2018 Ewald Oberhammer and Petra Pardatscher Oberhammer Rechtsanwalte GmbH).
The amendments brought to the French legislation in September 2018 and June 2019, exempt only certain activities from the obligation to make a declaration of posting and to designate a person to liaise with the competent authority. Business trips are not widely covered. Administrative fines for failure to comply are increased.
The concept of business trip is neither an autonomous concept and nor give rise to any exemption by operation of EU law.
Under the social security coordination regulations, business trips are not given any favourable treatment, a portable document A1 is required in any circumstances.
In regard to the application of posting rules under labour law, national legislations must be strictly considered.