Cross-border professional activity in the focus of the social security authorities - Regulation (EC) No 883/2004

Social security authorities are increasingly carrying out checks on social security subordination in the fight against undeclared work and in order to comply with national legislation.

Legal basis

On the basis of Regulation (EC) No. 883/2004, an employee is generally subject to the social security regulations of the Member State in which he carries out most of his activity, i.e. more than 25 %, when exercising an activity in another EU/EFTA country (territorial principle). This is independent of where the employer is based or where the employee lives.

Since this regulation came into force (for Switzerland in 2012), the employer now has the obligation to report any cross-border activities of employees to the competent social insurance institutions. This is to ensure that there is no undeclared work, i.e. no uninsured activity, and that national legislation is complied with.

The employee's social security affiliation for cross-border work is certified with the EU Form A1. It certifies that the employee is subject exclusively to the social security law of the home country. Conversely, it certifies that the foreign insurer is exempt from the obligation to pay contributions.

What qualifies as a cross-border activity requiring certification or how is a business trip defined in the context of social security law?

The distinction between posting in the classical sense and a business trip is not made from the perspective of social security law. For cross-border activities, therefore, an A1 certificate is required from the very first day. A minimum time limit is not set. As a result, participation in a trade fair, a conference or a short customer meeting - if in a professional context - is considered to be a crossing of the border requiring certification. Controls by the competent authorities have been intensified for some time and the absence of an A1 confirmation can be punished with sanctions or fines.

Digital application and certification option

With the project Electronic Exchange of Social Data (EESSI), the competent EU insurance institutions are pursuing the goal of simplifying and standardizing the exchange of data. The previously necessary use of paper forms will be replaced by the possibility of electronic application and transmission. In Switzerland, the ALPS platform was developed in connection with EESSI. Since 2018, ALPS (Application Legislation Platform Switzerland) has facilitated the handling of social security matters in an international environment. Foreign assignments can thus be processed quickly and efficiently. The registration on ALPS automatically triggers a process at the compensation fund and makes it possible to provide the employer with the necessary certificate for download within the shortest possible time.

Outlook

The aim is to simplify the life and work of EU/EFTA citizens and to revise the European rules on the coordination of social security systems. Efforts are being made by the European Commission to ensure fair mobility for individuals and businesses. At the same time, the fight against fraud is becoming more important. One of the objectives of this revision is that there is no longer any need to apply for an A1 secondment form for business trips within the EU. It is therefore to be hoped that the administrative burden on employers with regard to cross-border activities will be reduced.

Support

Are you unsure whether employees of your company are exposed to such situations? Do you need assistance in applying for the relevant certificate or do you have further questions about cross-border activities? Our specialists in social security law, taxes and labour law will be happy to assist you