As we reported before, an agreement has been reached between the European Parliament, the European Commission and the Council on the amendment of the regulatory framework for posted workers. On this basis the European Parliament has just adopted a new European directive on posted workers.
The earlier European regulation governed only a few aspects of free movement of labour, such as from what date should income tax on wages be paid in the host country or from what date the posted worker is transferred in the host country’s social security system. In respect of remuneration, solely the host country’s minimum wage or the sectoral agreement on required wages had to be taken into consideration. According to the newly adopted directive, all provisions of Labour Law of the host country shall be applied to the employee after 12 months, and this timeframe may only be extended once with additional 6 months. The directive will not apply to workers in the freight forwarding industry where a special regulation will be adopted. The member states have two years to implement the modified regulations.
Good to know in this respect: in certain cases, posting is subject to the consent of the employee. According to the Hungarian Labour Code, the employer may temporarily reassign the employee to a different position, workplace or employer than as specified in the employments contract but its duration may not exceed a total of forty-four working days or three hundred and fifty-two scheduled hours during a calendar year. If the employer intends to post an employee to another country for a longer period, the agreement of both parties is required.
A widespread misbelief in connection of temporary posting is that only working abroad as a subcontractor is considered as temporary posting although intra-group reassignments shall also qualify as posting. It is very common, especially at transfers within corporate groups, that companies do not apply the rules of temporary posting, instead they simply conclude a new contract with the employee. Of course, it is a lawful solution as well but if the preceding service period is not taken into account in the new employment relationship (e.g. probation period is stipulated again or severance payment is not granted) it may be perceived as a misfeasance pursuant to the host country’s law.
It is important to highlight that according to the Hungarian Labour Code, in case of postings exceeding fifteen days the employee must be notified in writing about the place and duration of working abroad; the benefits and their currency; and the rules on returning home.