Legal & Tax Alerts

New requirements for posting of workers in the provision of transnational services

A new enactment recently published in the Official Gazette[1] seeks harmonization with European law[2] and at the same time makes significant changes to the posting of workers in the provision of transnational services. Among these changes, we mention the following:

New rights for posted workers

Workers have a well-defined set of rights during the period of posting in a Member State of the European Union or in Switzerland, including the right to the minimum rates of pay defined by the legislation and/or practice of the host State, including compensation for overtime work.

Among the most important changes, we list the replacement of the notion of minimum rates of pay with that of remuneration. Thus, the remuneration to be granted during the transnational posting period may include not only the minimum rates of pay but also other bonuses and allowances required under the legislation of the host State, such as the increment for work on weekly rest days, the increment for work on public holidays or the increment for work performed during the night. The allowance specific to transnational posting is considered part of the remuneration, unless paid in reimbursement of expenditure actually incurred on account of the posting, such as expenditure on travel, board and lodging.

Moreover, the “core” of the rights enjoyed by posted workers in the provision of transnational services also extends to:

the conditions of workers’ accommodation where provided by the employer to workers sent to temporarily perform works or tasks corresponding to the service attributions at a different job than their usual place of work;

the allowances or reimbursement of expenditure to cover travel, board and lodging expenses for workers obliged for professional reasons to travel to and from their usual place of work in the Member State in whose territory they are seconded or if they are temporarily sent by their employer from their usual place of employment to another place of employment, in accordance with the legislation or collective labour agreement of general application in the host State.

New obligations for employers

If the effective duration of the posting exceeds 12 months, posted workers in the framework of the provision of transnational services shall, in addition, benefit from all the applicable terms and conditions of employment which are laid down in the Member State where the work is carried out by law or collective agreements with general application, except:

procedures, formalities and conditions for concluding and terminating the individual employment contract, including non-compete clauses;

supplementary occupational pension schemes.

The period of posting provided for may be extended by a maximum of six months in the event of a reasoned notification by the undertaking to the competent authority in the territory of the Member State where the posted workers carry out their activity. In the case of Romania, the notification will be sent to the territorial labour inspectorate in whose territorial area the posted workers perform the activity, at the latest on the day prior to the 12-month deadline.

Moreover, undertakings established in Romania which, in the framework of the provision of transnational services, post workers in the territory of a Member State or in the Swiss Confederation have new obligations to inform the posted worker, such as regarding the constituent elements of remuneration he/she has the right to, or expenses actually generated by the posting, such as transport, accommodation and meals (otherwise risking fines of up to 20,000 lei).

Clarifications on the provision of temporary employees

As a rule, the user undertaking established or operating in Romania informs, in writing, the temporary work agent about the remuneration, working conditions, employment that they apply at the level of the undertaking, otherwise it may be applied fines of up to 20,000 lei.

Clarifications are also provided on subsequent posting. Thus, if a foreign temporary work agent puts workers at the disposal of a user undertaking established in Romania, and the latter orders the activity to be carried out in another Member State, the worker will be considered to be posted to the territory of that Member State by the agent, with which he/she is in an employment relationship. The user undertaking established or operating in Romania has the obligation to inform the temporary work agent which provided the worker, at least 30 days before starting the activity in that state (otherwise fines may be applicable up to 10,000 lei).

In addition, if a temporary work agent in Romania makes a worker available to a foreign user undertaking and that user undertaking order the activity to be carried out in another Member State, the worker will be considered posted to the territory of that Member State by the agent.

Non-observance of conditions – undeclared work

If following the overall assessment of the factual elements, the labour inspectors find that the conditions for transnational posting are not met, they shall notify the competent authorities of the home state of the service provider and/or, as the case may be, apply to the Romanian beneficiary the sanctions provided by law for undeclared work.

Road transportation sector

The provisions on transnational posting also apply to the road transport sector, with the exception of matters relating to the granting of rights relating to remuneration, accommodation, allowances, the duration of posting or the provision of an employee by a temporary work agent.

Drivers posted in the provision of transnational services shall, regardless of the law applicable to the employment relationship, benefit from the minimum rates of pay applicable in a Member State or in the Swiss Confederation, including overtime compensation.

 

[1] Law no. 172/2020 for the amendment and completion of Law no. 16/2017 on posting of workers within the provision of transnational services, published in the Official Gazette, Part I no. 736 of  August 13, 2020;

[2] Directive (EU) 2018/957 of the European Parliament and of the Council of 28 June 2018 amending Directive 96/71 / EC concerning the posting of workers in the framework of the provision of services, published in the Official Journal of the European Union, L series, no. 173 of July 9, 2018, and art. 7 para. (2) and (4) of Directive (EU) 2019 / 1.152 of the European Parliament and of the Council of 20 June 2019 on transparent and predictable working conditions in the European Union, published in the Official Journal of the European Union, L series, no. 186 of July 11, 2019.

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