A posted worker is covered by the social security system of his place of work if he replaces another posted worker, even if those workers were not posted by the same employer

The Court of Justice of the European Union has sentenced today, September 6, that a posted worker is covered by the social security system of his place of work if he replaces another posted worker, even if those workers were not posted by the same employer(Judgment in Case C-527/16)

The case

The Austrian company Alpenrind operates an abattoir in Salzburg. From 2012 to 2014 Alpenrind employed workers posted to Austria by the Hungarian company Martimpex to cut and pack meat.

Both before and after that period the work was carried out by the workers of another Hungarian company, Martin-Meat. For approximately 250 workers posted by Martimpex from 1 February 2012 to 13 December 2013 the Hungarian social security institution issued A1 certificates attesting that the Hungarian social security system applied – some with retroactive effect and some in cases in which the Austrian social security institution had already determined that the workers concerned were subject to compulsory insurance in Austria.

The decision of the Austrian social security institution establishing that the workers were subject to compulsory insurance in Austria was challenged before the Austrian courts. It is against that background that the Verwaltungsgerichtshof (Upper Administrative Court, Austria)3 asked the Court of Justice to clarify the EU rules relating to the coordination of social security systems and, in particular, the binding effect of the A1 certificate.

The judgment

By its judgment today, the Court holds that an A1 certificate issued by the competent social security institution of a Member State (Hungary in this case) is binding on both the social

security institutions and the courts of the Member State in which the activity is carried out (Austria) so long as that certificate has not been withdrawn or declared invalid by the Member State in which it was issued (Hungary).

The same applies where, as in the present case, the competent authorities of the two Member States have brought the matter before the Administrative Commission for the

Coordination of the Social Security Systems and it has concluded that that certificate was incorrectly issued and should be withdrawn. The Court observes, in that regard, that the role of the Administrative Commission in that context is limited to the reconciliation of the views of the competent authorities of the Member States which brought the matter before it and that the Administrative Commission’s conclusions have the status of an opinion.

Furthermore, the Court states that an A1 certificate may apply with retroactive effect, even though, on the date of issue of that certificate, the competent institution of the Member State in which the work is carried out (Austria) has already decided that the worker concerned is subject to the compulsory insurance of the latter Member State.

The Court also held that, in a case in which a worker posted by his employer to carry out work in another Member State is replaced by another worker posted by a different employer, the second worker cannot remain subject to the legislation of the Member State in which his employer usually carries on its activities.

As a general rule, a worker is subject to the social security system of the Member State in which he pursues his activities, in particular, in order to guarantee the equality of treatment of all persons occupied in the territory of a Member State as effectively as possible.

It is only under certain conditions that the European Union legislature has provided for the possibility for a posted worker to remain subject to the social security system of the Member State

in which his employer normally carries on its activities. Thus, the legislature excluded that possibility where a posted worker replaces another person. The Court states that there is such a replacement where a worker posted by his employer to work in another Member State is replaced by a worker posted by another employer.

The fact that the employers of the two workers concerned have their registered office in the same Member State or that they may have personal or organisational links is relevant in that regard. Click here for further information.