Challenges concerning the posting of foreign nationals to Germany

In 2020, Despite economic problems caused by the coronavirus pandemic, the total volume of trade between Poland and Germany amounted to ok. 123,000,000,000 EUR, According to the association, the Eastern Commission of the German Economy (German: Ost-Ausschuss der Deutschen Wirtschaft e.V.)[1].

At the same time, according to the January Barometer 2021” 2 , In the first quarter 2021 ok. 20.6% German companies in general were faced with a lack of qualified staff. This figure is expected to grow rapidly as the economic situation improves as the pandemic is expected to expire.

The existence of such a large demand for workers and the general intensification of Polish-German business contacts make Polish companies increasingly try to operate in Germany. However, the design of German regulations and the approach of German authorities do not always make this task easy, so it is worth looking at the main requirements and ways of doing business behind Odra.

The starting point will be the use of the EU's free movement of services detailed in Directive 96/71 concerning the posting of workers in the framework of the provision of services (hereinafter the Directive) 3 . This legislation provides for the making available of workers in the framework of cross-border cooperation between EU companies – including internal and trade delegation – also the form of outsourcing (subcontracting) and temporary work.

The principle of posting workers to work in other EU countries – regardless of the way it is carried out – is the application of local labour law applicable to the place of work.

And so, in accordance with the provisions of the German Posting Act (Arbeitnehmerentsendegesetz, AEntG) 4 , which has implemented the provisions of the Directive into German law, must be guaranteed to workers minimum employment conditions (statutory, relatively defined in collective agreements in specific sectors), if they are more favourable than those resulting from the regulation of the country of secondment, i.e.

Polish.

In terms of the rate of remuneration, unless otherwise provided for in the specific industry, the overall minimum wage will apply on the basis of which until the end of June 2021 is 9.5 EUR gross per hour, then to the end 2021 – 9.6 EUR gross[5]. However, this rate is only an indicative point, since the 30 July 2020 Remuneration should be provided to posted workers as to the staff of the establishment to which they were seconded[6].

The differences between the two forms of business in Germany and the corresponding employment of employees are described in detail below.

Distinguishing outsourcing of services from temporary work

Before we get to the details, let's look at where the main difference lies between business models consisting in providing temporary workers to Germany and providing cross-border services. The latter is governed primarily by the rules on the industry for which the company provides its services, e.g. subcontracting in the construction industry will be subject to the specificity of the collective agreement for the industry.

The main challenge of outsourcing companies, as in Poland, remains the risk of recognising their services as services not within a specific industry, but as services for the lending of workers covered by temporary work regulations.

The mere employment in the outsourcing formula, regardless of the nationality of employees, is common in both Germany and Poland. However, particular emphasis should be placed on reducing the risk of a service or work contract (i.e.

Dienstleistungs-werkvertrag) for the German contracting authority may be considered to be apparent and contained in fact for the purpose of concealing temporary employment.

The limits between such contracts and temporary work may prove to be smooth, so it is crucial that the Polish company performs the service in Germany at its own risk, using its own tools and without integrating the seconded colleagues with the local crew.

To distinguish these forms of employment, the rich case law of the German courts remains in force.[7]. According to him, integrating foreign workers with their own crew and giving them direct instructions is a temporary work. It is only permissible to issue instructions to posted workers by the Polish employer or through persons authorised by him. Ultimately, the actual will of the parties will be decided, not the formal name of the agreement between entrepreneurs.

In the case of misinformed outsourcing, problems will concern the very legal basis for cooperation between companies and the nature of employment, but not only.

First of all, as part of the audit of the German authorities, it is possible to recognise that there is a contract of employment between an entity who benefits from the work of a given person and an employee seconded by a company from Poland.

This means that the employment of such a person should be subject to German law in its entirety and not only within the framework of a catalogue of working conditions resulting from Article 3 The directives to be provided by an entrepreneur posting an employee to Germany. Further consequences will include social security issues.

If, in fact, temporary work is carried out in favour of a German counterparty, the liability for social security contributions to be paid in Germany shall be borne by the German entity with whom the seconded employee and the loaner are working in solidarity.

According to the position represented in German literature 8 Certificate A alone[1] issued by the Polish Social Insurance Institution and confirming the subject of social insurance in Poland will not prevent the recognition of a relationship for temporary work.

However, the certificate may prevent the obligation to pay social security contributions in Germany, unless the time frame for temporary work is exceeded, i.e. 18 months for one user in Germany.

Moreover, according to the case law of the German courts 9 mere possession of certificate A[1] does not exclude risks associated with hidden temporary work: i.e.

in addition to the fine for the lack of permission to lend employees (to 30,000 EUR) it is also possible to demand the forfeiture of the benefits achieved by the "user's employer" (due to the failure to apply the equal pay principle and the savings on social security contributions paid in Poland).

In view of these risks, employment and posting to Germany is particularly attractive in the framework of temporary work. However, in view of the provisions on the employment of nationals of the Member States, third, It will be very difficult in case the Polish agency for temporary work intends to make a national of the state available in Germany third.

Basic assumptions for temporary work in Germany

Temporary employment is regulated by the German Act on the making available of workers (Arbeitnehmerüberlassungsgesetz, abbreviation AÜG).

In the case of temporary employment agencies, the regulations in force in Germany explicitly provide that EU companies may delegate workers to temporary work in Germany under the same conditions as companies in Germany (section 3 section 4 AÜG).

The agency for temporary work based in Poland must therefore not only comply with the requirements of the Polish law, but also be subject to the laws and requirements of German law, apply German collective and individual labour law, hourly rates or comply with the rules of legalization of residence and work of nationals of the states third and applies to the inclusion of individual industries (in the construction and meat industry, temporary employment in Germany is prohibited).

In Germany, the provision of staff requires a special permit (German: Erlaubnis zur Arbeitnehmerüberlassung), issued by the German Federal Labour Agency (German: Bundesagentur für Arbeit), and the demonstration of adequate financial resources.

Section 8 section 2 AÜG shows that, exceptionally, the working conditions of temporary workers, including their remuneration, may be less favourable (to the limit described below), if they arise from a collective agreement, and in a contract between the temporary worker and the employer the parties agree to apply it.

Exemption shall apply for a period of time 9 months of temporary employment for the user's employer. After this period, the equal pay principle applies.

In practice, German temporary employment agencies are eager to make use of this possibility, so very often the contract with a temporary worker in Germany provides for the application of the collective labour agreement and the wage rates there. The arrangement rates are regularly lower than those that would be eligible for workers in the event of an equal pay rule.

Importantly, German collective labour agreements can also be relied on by companies based in Poland, with the Federal Labour Agency requiring entrepreneurs who intend to apply them to do temporary work. However, there is a favourable case-law that any mixed company (operating in many industries) may apply collective agreements irrespective of having a specific branch for temporary work or its absence[10].

In the sector of temporary work for both German employers and those posting workers to Germany, regardless of the application of the industry collective agreement, the minimum minimum rate is currently at the territory of the entire RFN 10.45 EUR gross. Time and Time first from 1 April 2021 the rates for the eastern and western states have been leveled. This rate is systematically increased – from 1 April 2022 to the end 2022 it will be equal to 10.88 EUR gross[11].

From 2017 AÜG contains specific solutions to eliminate the phenomenon of concealing actual temporary work under the phenomenon of fictitious outsourcing of services. Among other things, the definition of temporary work was clarified when the worker is "incorporated into the organisation of the work of the user's employer and subject to its indications".

Temporary work must be immediately at the time of concluding the contract as such defined. The contract shall also indicate the specific employee lent. This is aimed at eliminating the often-known practice of obtaining temporary work permits in case of an inspection by state authorities only.

Legalising the work of nationals third Germany

In the light of the principle of freedom to provide services, EU citizens operating an enterprise cannot be prohibited In one country of the European Union offering its services in another EU country. However, this principle does not determine the situation of national citizens third (i.e. citizens of non-EU countries, such as Ukrainian citizens), employed In one EU country wishing to work in another Member State.

Under Article 1(3).

point (a) Directive as one option to work in another EU country has been determined by the posting of workers for their own account and under their direction in the territory of another Member State, under an agreement concluded between the posting undertaking and the service recipient operating in the Member State concerned, in so far as there is an employment relationship between the posting undertaking and the worker during the period of posting.

On the basis of this, Polish companies can delegate workers – citizens of the country third – to Germany, in order to be limited in time in the provision of services, theoretically without the need to obtain further employment-legalising permits.

In addition, under the case law of the European Court of Justice, the principle is that EU countries cannot impose additional restrictions (such as work permits) on non-EU workers legally employed In one Member State sent to work in another EU country[12].

Thus, it seems that foreigners whose work has been legalised in Poland can be transferred to Germany without additional formalities. But reality is different. It was against the background of this ruling that the ECJ, Germany, introduced a special type of visa – Vander Elst visa.

Thus, in cooperation with a German contractor with non-EU co-workers, not only Polish immigration regulations but also German will be important.

Access to the German labour market is governed by the provisions of the Act on residence, active employment and integration of foreigners in Germany (German AufenthG) and the Regulation on the employment of foreigners (German Beschäftigungsverordnung, BeschV).

As a general rule, nationals of countries which are not members of the EU or the European Economic Area (EEA) must have an appropriate legal title for legal residence in Germany with a work permit.

In the light of the regulations on the right of residence, work is understood widely, as all activities carried out on their own, and therefore also on the basis of contract contracts (taking into account the limitations in this respect resulting from Polish law).

It is crucial to be guided and integrated into the structure of the company.

Importantly, having visa-free rights for certain groups of foreigners (e.g. from Ukraine) does not mean that citizens can work freely in Germany. The visa-free movement concerns, in accordance with Union law, only the right of entry into 90 days during 180 days to the Schengen States for tourism or family purposes and does not automatically mean the right to work. Visa-free nationals of countries entering the EU for commercial purposes must continue to apply for appropriate visas and permits.

According to section 21 BeschV is not required to obtain a full residence permit for a person who is employed by an EU-based company for the purpose of temporarily providing services in Germany. On the basis of this provision, a special Vander Elst visa is issued for seconded nationals of countries third.

This solution makes it easier to obtain this special visa simplified in relation to the classic German residence title. The seconded persons already have the right to reside and work in another EU country, and therefore detailed verification in Germany is no longer necessary.

The absolute requirement to obtain such a visa is to conclude a contract of employment, or contract, with a national of the State third and his employment in Poland for at least one month before taking up employment in Germany. The granting of a visa is excluded when a person's stay in Poland is intended only to move to Germany.

Another condition is that the provision of services should take place under the sole responsibility of the posting company and without the command of the German company. In practice, obtaining this visa requires considerable effort, due to the very prosaic aspect – difficulties in booking the visa term at the German Embassy in Warsaw. It is the only place in Poland to consider these applications.

An additional complication is that, from the point of view of legalising the employment of workers from outside the EU in Germany, in principle, the only practically acceptable form of secondment to Germany will be seconded by a Polish entity to a German recipient under a non-interim service, regardless of the industry in which the work is carried out. This is due to the shape of the German immigration law, aimed at employing foreigners for jobs without higher education only by exception.

In case of the intention to employ nationals of the state third, no right of residence will be granted by the German Federal Labour Agency (Bundesagegentur für Arbeit Zentralstelle für Arbeitsvermittlung, ZAV) if the employment would be temporary. What is worth noting, temporary work is also unacceptable in the case of applying for Vander Elst.

However, such problems are not caused by hiring Polish citizens. Temporary employment may be a less risky way of employing this group of workers by Polish companies operating in Germany, given the risk of outsourcing being considered as a hidden temporary work.

Summary

In summary of the above considerations, it should be pointed out that in the case of the employment of citizens of EU Member States (including Poland), both temporary work and outsourcing can be deployed.

On the other hand, in terms of employment of citizens of the state third It seems that only staff outsourcing services can be employed in the form of posting to Germany. Basic way of legalising work for citizens of the states third posted to work in Germany will be Vander Elst visa.

In each of these options, attention should be paid to the risks associated with hidden temporary work and the control of the German customs office and the pension authorities for social security contributions.

However, it should be pointed out that the essential safety condition for such activities is the proper preparation and, above all, enforcement of the contract with the German service recipient, so that the contract is not considered to circumvent German rules on temporary work.

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