Posting of Workers


The number of posted workers in the EU is currently estimated to be 1.2 million which amounts to less than 1% of the EU working age population. The limited amount of people who in fact participate in posting is due to many factors such as unawareness, bureaucracy and a general unwillingness to relocate.

Who is a posted worker?

According to the Posting of Workers Directive 96/71/EC, which was adopted in 1996 and has been in force since December 1999, a posted worker is a person who, on behalf of the employer, is sent for a limited period of time to carry out his/her work in the territory of an EU Member State other than the State in which s/he normally works.

Posted workers do not include migrant workers who go to another EU Member State to seek work and are employed there, but it includes those employees who are normally employed in one EU State (“the posting State”) and decide to work temporarily in another EU State (“the host State”).

Areas and rules

The mentioned EU Directive covers employees being sent, for a set period of time, to another Member State in three situations:

  • When an employer posts a worker to another Member States on his/her own account and under his/her direction, under a contract which the employer has concluded with the party in the State for whom the services are intended;
  • When an employer posts a worker to an establishment or to an undertaking owned by the same group of companies, but which is based in the territory of another EU Member State;
  • When a worker is posted through an agreement between an employer and a recruitment agency.

The employment relationship between the employer and the posted employee must be maintained during the whole period of posting.

Posted workers’ rights

The Directive establishes a core of mandatory rules regarding the terms and conditions of employment which must be applied to posted workers which includes guarantying that their rights and working conditions, such as, amongst other, maximum work periods and minimum rest periods, minimum rates of pay, health, safety and hygiene at work, protected throughout the EU and avoiding “social dumping” where foreign service providers can undercut local service providers because their labor standards are lower.

The idea is that where a Member State has certain minimum terms and conditions of employment, these must also apply to workers posted to that State. However, the employer is not prevented from applying working conditions better than the ones applied in the host State.


It is a common tax principle that tax on employment income is paid in the country in which the income is earned.

However, remuneration derived by a resident of an EU Member State in respect of employment exercised in another EU Member State is taxable only in the former State if:

  • the recipient is present in the other State for a period or periods not exceeding in the aggregate 183 days in any 12 month period commencing or ending in the fiscal year concerned; and
  • the remuneration is paid by, or on behalf of, an employer who is not a resident of the other State; and
  • the remuneration is not borne by a permanent establishment which the employer has in the other State.

Social Security

As a general principle, under EU Legislation, the social security scheme applicable to posted workers is that established by the legislation of the host State.

EU Legislation allows posted workers to continue, for a period up to two years to pay social security contribution in the posting State by asking for the issuance of the A1 certificate. This certificate has to be submitted to the authority of the host State in order for the posted worker to be able to avail of the social security benefits in the host State without directly contributing to the social welfare system of that State. Regardless of the A1 certificate, some countries have obligatory employers’ liability insurance which the employer must undertake to.

[gdlr_process min_height=”100px” type=”horizontal” ]

[gdlr_tab icon=”icon-thumb-tack”]An employee is already employed in Malta (“the posting State”) with a local company;


[gdlr_tab icon=”icon-thumb-tack”]The company decides to post the employee to another EU State (“the host State”) and an agreement is reached in this regard;


[gdlr_tab icon=”icon-thumb-tack”]The authorities (labour, immigration, tax and social security, amongst other) of the host State are notified of the posting;


[gdlr_tab icon=”icon-thumb-tack”]The posted worker is authorised to work in the host State (depending on the Member State and the nationality of the posted worker) and is provided with tax details;


[gdlr_tab icon=”icon-thumb-tack”]The posted worker can commence work.



Where to now?

The EU is currently in negotiations in order to facilitate movement of employees and this is being done through on-going efforts for national authorities in separate Member States to co-operate in a more structured manner.

Additionally, in May 2014, the EU Council of Ministers has adopted the new Enforcement Directive to increase the protection of workers temporarily posted abroad by, increasing the awareness of workers and companies about their rights and obligations as regards the terms and conditions of employment, improving cooperation between national authorities in charge of posting and clarifying the definition of posting so as to increase legal certainty for posted workers and service providers, whilst simultaneously tackling ‘letter-box’ companies that use posting to circumvent the law (amongst other).

Legal-Services-Malta-Ann-BugejaThe posting of workers has not yet had the effect intended for it by the EU. However, through the Enforcement Directive, it may be possible that the initial objectives of this Directive will be reached. More employers need to start seeing the benefit of posting their employees abroad, and more employees need to be aware of their rights in such circumstances.

However, none of this is possible if the national authorities in all Member States do not simplify matters for employers and employees. Only time will tell if the Enforcement Directive achieves its purpose.

Dr. Ann Bugeja joined CSB Group in January 2011 where her areas of interest cover Ship and Yacht Registration, Employment Law, Contract Drafting, Residence and Work Permit applications and applications for Special Tax Status.