Leping

Framework Agreement on the application of Article 16 (l) of Regulation (EC) No. 883 /2004 in cases of habitual cross-border telework (l)Giventheflexibilization anddigitalizationof thelabour marketas wellasthe increaseincross­ border telework sincethe Covid-19pandemic, teleworkhas become a structural wayofworkingfor many workers;

(2) ln the light that Regulation (EC) No 883/2004 was concluded when telework was performed less commonly; (3) Given the desire to mitigate the effect of cross-border telework on the applicable legislation in social

security in the short term; (4) Given the wide variety ofteleworkers and the complexity of realizing this desire with regard to such

a diverse group of persons in the short-term; (5) Bearing in mind that Article 16 (1) of Regulation (EC) No 883/2004 provides for the option of

exceptions from the applicable legislation specified under Title 11 of this Regulation; (6) Agreeing on conditions under which requests for exceptions to Article 13 (1) (a) of Regulation (EC)

No 883/2004 due to habitual cross-border telework should be facilitated as mu eh as possible; the competent authorities or the institutions designated by the signatory States conclude the following

Framework Agreement:

Article 1

Definitions

For the purposes of this Framework Agreement:

(a) 'Basic Regulation' means Regulation (EC) No 883/2004;

(b) 'lmplementing Regulation' means Regulation (EC) No 987 /2009;

(e) 'Cross-border telework' is an activity which can be pursued from any location and could be

performed at the employer's premises or place of business and:

1. is carried aut ina Member State or Member States other than the one in which the

employer's premises or the place of business are situated and

2. is based on information technology to remain connected to the employer's or business's working environment as well as stakeholders/clients in order to fulfil the

employee's tasks assigned by the employer or clients, in case of self-employed persons;

(d) 'EESSI' means Electronic Exchange of Social Security lnformation;

(e) 'Residence' means residence as referred to in Article 1 (j) of the Basic Regulation;

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Article 2 Scope (l) Uniess otherwise provided in this Article, this Framework Agreement covers all

persons to whom Article 16 (l) of the Basic Regulation can be applied, provided that their residence isin a signatory State and the registered office or place of business of the undertaking or employer is situated in one other signatory State.

(2) This Framework Agreement covers persons to whom the legislation of the State of residence would be applicable asa resuit of habitual cross-border telework in application of Article 13 (l) (a) of the Basic Regulation in conjunction with Article 14 (8) and 14 (10) of the lmplementing Regulation and who are employed by one or more undertakings or employers (hereinafter only referred to as 'the employer') which have their registered office or place of business in only one other signatory State.

(3) Without prejudice to Article 6, this Framework Agreement shall not cover persons who:

(i) habitually pursue an activity other than cross-border telework in the State of residence and/or

(ii) habitually pursue an activity ina state other than those mentioned in paragraph l and/or

(iii) are self-employed. ·

Article 3 Applicable legislation Upon request, a person who carries out habitual cross-border telework

within the meaning of Article l of this Framework Agreement and is covered by Article 2, will be subject on the basis of Article 16 (l) of the Basic Regulation to the legislation of the State in which the employer has his registered office or place of business, provided that the cross-border telework in the State of resid e n ee is less than 50% of the total working time.

Article 4 Procedure (l) A request under Article 3 of this Framework Agreement shall be submitted in

accordance with Article 18 ofthe lmplementing Regulation.

(2) This Framework Agreement does not cover requests, as referred to in paragraph l, if such requests

concern a period prior to the entry into force. (3) Without prejudice to paragraph 2 and Article 6, this Framework Agreement shall not cover a request

as referred to in paragraph l, if such a request concerns a period prior to the date on which the request was submitted, uniess during this period social security contributions were paid into or the employee was otherwise covered by the social security scheme of the signatory State in which the employer has his registered office or place of business, and:

(i) the requested period prior to the date on which the request was submitted does not exceed three months, or (ii) such request is submitted no later than 30 J une 2024 and the period prior to the date on which the

request was submitted does not exceed twelve months.

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(4) An agreement under Article 3 of this Framework Agreement may be applied for a maximum of 3 years ata time, with extensions possible upon a new request.

(S) The exchange of information concerning the individual cases under this Framework Agreement shall take place between the competent bodies via EESSI using LA_BUC_Ol where the agreement of the signatory State of residence could be considered as pre-given.

(6) The competent institution of the signatory State whose legislation is applicable shall provide an attestation (PD Al) in accordance with Article 19 of the lmplementing Regulation.

Article S

Depository State

(1) A signatory State will be appointed as depository State which will:

(i) collect all signed copies ofthis Framework Agreement;

(ii) duly publish the Framework Agreement and;

(iii) inform all signatory States of relevant information.

(2) The signatory States s hall forward to the depository State the Agreement signed by the competent authority or the institution designated by the signatory State.

Article 6 Final Provisions (1) This Framework Agreement does not affect the possibility of concluding an

individual agreement on the basis of Article 16 (1) of the Basic Regulation in situations, which are not covered by Articles 2 to 4 in which the special situation of habitual cross-border telework could be taken into account on an individual basis. The signatory States agree that the lack of a concrete end date for structural [non­ temporary] cross-border telework in such cases will not be used asa reason to refuse the conclusion of an individual agreement, which falls out of scope of this Framework Agreement, under Article 16 (1) of the Basic Regulation as an exception to Article 13 of the Basic Regulation. (2) This Framework

Agreement shall enter into force on 1 July 2023 as long as at least two States have signed it. lt is concluded for a period of S years and shall be automatically extended each time for another S years. (3) ln case a signatory State signs this Agreement ata later stage, itshall take effect for

said State on the 1st of the month following the signatu re.

(4) Any of the signatory States may terminate its adherence to the agreement by giving 3 months'

written notice to the Depository State. (5) This Framework Agreement may be terminated by agreement of all signatory States.

(6) The expiry of this Framework Agreement sh all not affect the validity of agreements concluded on the basis of Article 3 as long as the prevailing facts do not change.

/3 O✓. ~b Done at Tallinn on ~.... '

by the competent authority of Estonia or the institution designated by this signatory State.

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Maret Maripuu

Director General

The Estonian Social lnsurance Board

Explanatory Memorandum to the Framework Agreement on the

application of Article 16 (1) of Regulation (EC) No. 883/2004 in

cases of habitual cross-border telework

Objective of this agreement

Cross-border telework is not in itself a new phenomenon but since the COVID-19 pandemic it now

affects a very large group of workers. It may have a big impact on which competent Member State is

competent for the social security of a person. That is why a reflection is warranted on how the conflict

rules of the Regulations on social security n° 883/2004 and 987/2009 must be applied on this way of

working and if the outcome of these conflict rules is opportune and in line with the freedom of

movement and the internal market. The sanitary measures during the COVID-19 pandemic

(mandatory/strongly recommended telework) forced employers to allow telework and employees to

take it up. This resulted in an explosive accrual of telework. This (partial) telework still persists as a

permanent new way of work. Specific measures have been taken during the pandemic and the ensuing

period to avoid a change of the competent State for the social security of the worker due to accrued

telework4. These no-impact measures apply up to and including the 30 June 2023.

Since the physical place of work is a decisive criterion with regard to the applicable social security

legislation, teleworking in the Member State of residence may lead to a change in social security

legislation if a person does not reside in the state of the employer's premises. This will be the case, for

example, as soon as the telework in the state of residence amounts to a share of 25%.

In order to take account of the changed working patterns, this framework Agreement offers a solution

which combines the interests of the workers, the employers, and the social security institutions to face

the reality of telework until the coordinating Regulations on social security will be adapted. It lays down

the rules for the efficient and timely conclusion of individual article 16 agreements for the cases in its

scope.

Nature of this agreement

The signatory Member states agree on how to assess individual requests submitted: which Member

State will be competent and under which conditions the agreement will be given. It entails a

mechanism where the signatory Member States pre-give their agreement (fix their policy) and no

regular request-agreement procedure is needed to conclude the individual agreement based on Article

16 of Regulation 883/2004. The juridical basis of the determination of the legislation applicable

remains the individual on-request derogation, only the procedure is simplified and legal certainty is

offered in advance.

When an Article 16 request is submitted and accepted, the special rule of the framework agreement

is applied. When no Article 16 request is submitted, the normal conflict rules determine the competent

Member State and the Member State of the residence of the worker must be informed of the cross-

border activities. In other words, the employee/employer are offered the possibility to opt-in to the

4 https://ec.europa.eu/social/main.jsp?catId=868&langId=en

rules proposed by the Framework Agreement by requesting an exception on the basis of Article 16 of

the Basic Regulation.

Article 1: definition

This article contains a definition for the purposes of determining the applicable legislation (competent

Member State for social security). This general definition encompasses telework activities by

employees and self-employed persons, but the latter are excluded from the scope of this Framework

Agreement (Article 2(3)(iii)).

The main characteristic of telework is that the employee or self-employed person can carry out their

work activity from any location all over Europe and it is thus completely location-independent. This

distinguishes telework from all other activities that require or imply the work activity to be carried out

at a certain place.

A digital connection (IT link) with the company’s infrastructure is an integral part of the definition of

working remotely as a teleworker. The teleworker needs to remain connected to the employer´s

working environment to fulfill the tasks assigned. This IT link must be normally and habitually present

but not necessarily during a 100% of the working time (e.g. reading materials or offline grading of tests

by a professor). This entails that, as a rule, manual activities outside the employer’s premises or

business place do not fall within the scope of the definition.

Article 2: scope

An Article 16 agreement implies that an exception is made to the regular conflict rules in Title II of

Regulation 883/2004 between the Member State which is competent via these conflict rules and the

Member State which requests to become competent. This Framework Agreement covers employees

who habitually work in different Member State and whose competent Member State is determined

via Article 13(1) of Regulation 883/2004. This article designates the Member State where the employer

is established (the statutory seat) or the Member State of residence of the person. The Framework

agreement thus only applies to persons whose State of residence and the State where their employer

is established are both signatory States.

The Framework Agreement applies to persons who telework in their Member State of residence 25%

or more of their total working time and for whom the Member State of residence thus becomes

competent under the normal rules of Title II of the Basic Regulation. Only employees who are

employed by one single employer (or several employers all situated in the same Member State) are

covered.

The Framework agreement only encompasses persons who habitually work in the State where the

statutory seat of their employer is established and telework in their State of residence, without

pursuing other activities than telework there.

Francis is teleworking from his residence Belgium 40% of his working time and is working 60% in the

Netherlands at the premises [branch] of his employer which has its statutory seat in Germany.

As Francis works outside of the signatory State where the statutory seat [registered office or place of

business] of his employer is situated the Framework Agreement does not apply.

Lena is teleworking from her residence in Italy for 40% of her working time and is working 60% of her

working time in Austria at statutory seat of her employer.

Provided that both Italy and Austria are signatory States, the application of this Framework Agreement

can be requested, resulting in the application of Austrian legislation.

Article 3: applicable legislation

When a request is submitted for a person, the signatory Member States conclude an Article 16

agreement derogating from Article 13(1)(a) designating the Member State where the employer(s) is

situated as competent, provided that the amount of telework in the Member State of residence is less

than 50% of the total working time of that employee. If a person works in the employ of several

employers, the total working time of every employer combined will be used as a reference. This implies

that the majority of the working time is pursued in the Member State where the employer(s) is

situated.

The cross-border telework must be agreed between employer and employee formally or informally.

The request for the application of the Framework agreement must be made in consent between them.

Article 4: procedure

Article 18 of the Implementing Regulation states that a request by the employer or the person shall be

submitted in the Member State, whose legislation the employee or person concerned requests to be

applied. This means that the request must be filed with the competent institution of the Member State

where the employer has its statutory seat.

Flexibility

The signatory States are aware that a period of adjustment to the reality of telework merits some

flexibility. The central point of view is that any request must be made pro futuro. Nonetheless there

are situations that warrant flexibility.

Paragraph 2 of the Framework agreement clarifies that a request submitted that includes a past period

cannot go back further in time than the entry into force of the Framework Agreement for both

signatory States concerned. In other words this Framework Agreement produces no effects prior to

the date of entry into force.

Paragraph 3 details the cases where flexibility is warranted and provides for two possibilities which

allow a request to be submitted that includes a past period, provided that contributions have already

been paid in the signatory State of the employer.

- First, under (i) a general provision that allows for a request to include a past period up to 3

months.

- Secondly, under (ii) a one-shot provision for a year starting from the 1 July 2023 up to and

including the 30 June 2024. This period immediately follows the transitional period installed

by the Administrative Commission (AC 125/22REV3).

During this period requests can be submitted for a past period up to 12 months, but may not

include a period prior to the entry into force of the Framework Agreement.

Request that only include a future period following the submission are in no way impacted by the

paragraphs (2) and (3) in Article 4.

Request that do not fall under paragraphs (2) and (3) in Article 4 that include a past period will be

processed as a regular Article 16 request in line with Article 6 (1).

Mark is working in France for a French employer since 2018. He has always worked 2 days from home

in Germany and has been subject to the German scheme since 2018 (substantial activity). On

1 January 2025 his employer asks for a derogation under the Framework Agreement for the coming

two years.

The Framework Agreement applies and therefore the agreement is considered pre-given allowing

France to immediately issue the A1 certificate as competent Member State.

Mark’s colleague Steven is working in France for a French employer since 2018. He has always worked

2 days from home in Germany and has been subject to the German scheme since 2018 (substantial

activity). On 1 January 2025 his employer asks for a derogation under the Framework Agreement a

two-year period concerning the 1 October 2024 up to the 1 October 2026.

The Framework Agreement does not apply as the request concerns a past period and contributions

have been paid in the German Scheme5.

Helena is working in Luxemburg for a Luxembourgish employer since 2021. She has always worked 2

days from home in Belgium but has been subject to the Luxembourgish scheme since 2021 (Covid-

19/Transition). On 1 January 2025 her employer asks for a derogation under the FA going back to the

1 July 2023 as her employer has continued to pay social security contributions in Luxemburg.

The agreement does not apply to Helena as it is submitted after 30 June 2024 and it concerns a

retroactive period for more than three months nor falls under the transitional provision5.

Paragraph 4 limits the period during which the legislation will be determined per request (and an A1

certificate issued) to a maximum of three years. If the telework fulfilling the conditions of the

Framework Agreement continues beyond this date, a new request can be submitted.

If the factual situation changes, this must be notified immediately by the employer or the employee to

the issuing Member State. This Member State must re-assess the case and, if necessary, withdraw or

terminate the A1 certificate.

Paragraphs 5 and 6 describe the procedural mechanism by which the individual Article 16 agreement

is concluded. A simplified procedure is put in place where both Member States pre-give their consent.

The competent institution of the Member State of the employer assesses, upon receipt of the request,

if the conditions of the Framework Agreement are fulfilled. If this is the case, an A1 certificate is issued

(box 3.11 is ticked) and the competent institution of the Member State of residence is electronically

informed via EESSI.

If the conditions of the Framework Agreement are not met, the case is dealt with as a regular Article

16 request. The outcome depends on the analysis and evaluation of the Member States involved.

5 This request will be considered as an individual Article 16 where competent institution in the signatory State

of the Employer can only issue the A1 certificate after it receives the explicit consent by the competent

institution in the signatory State of residence.

Article 5: Depository Member State

For practical reasons, a depository Member State is designated. This Member State must be one of the

signatory States.

Article 6: Final provisions

Paragraph 1 stipulates that the signatory Member States will take into account telework for cases of

cross-border telework outside the scope of the Framework Agreement and will not refuse Article 16

request for the sole reason that the habitual cross-border telework is anticipated to last for an

indefinite period of time.

Paragraph 2 fixes the validity period of this Agreement.

Paragraph 3 regulates the situation where a State signs the Framework Agreement at a stage where it

has already entered into force for at least two other signatory States.

Paragraph 4 regulates the termination by an individual signatory State.

Paragraph 5 regulates the termination of the Framework Agreement itself by all signatory States.

Paragraph 6 states that an issued A1 certificate and the underlying Article 16 agreement, concluded

before the termination of the Framework Agreement, will remain valid till the expiry date indicated on

the A1 certificate (provided that the factual situation does not change).

Framework Agreement on the application of Article 16 (1) of Regulation (EC) No. 883/2004 in cases of habitual cross-border telework

Article 1

Definitions

For the purposes of this Framework Agreement:

(a) ‘Basic Regulation’ means Regulation (EC) No 883/2004;

(b) ‘Implementing Regulation’ means Regulation (EC) No 987/2009;

(c) ‘Cross-border telework’ is an activity which can be pursued from any location and could be

performed at the employer’s premises or place of business and: 1. is carried out in a Member State or Member States other than the one in which the

employer’s premises or the place of business are situated and 2. is based on information technology to remain connected to the employer’s or

business’s working environment as well as stakeholders/clients in order to fulfil the employee’s tasks assigned by the employer or clients, in case of self-employed persons;

(d) ‘EESSI’ means Electronic Exchange of Social Security Information;

(e) ‘Residence’ means residence as referred to in Article 1 (j) of the Basic Regulation;

(1) Given the flexibilization and digitalization of the labour market as well as the increase in cross- border telework since the Covid-19 pandemic, telework has become a structural way of working for many workers;

(2) In the light that Regulation (EC) No 883/2004 was concluded when telework was performed less commonly; (3) Given the desire to mitigate the effect of cross-border telework on the applicable legislation in social security in the short term; (4) Given the wide variety of teleworkers and the complexity of realizing this desire with regard to such a diverse group of persons in the short-term; (5) Bearing in mind that Article 16 (1) of Regulation (EC) No 883/2004 provides for the option of exceptions from the applicable legislation specified under Title II of this Regulation; (6) Agreeing on conditions under which requests for exceptions to Article 13 (1) (a) of Regulation (EC) No 883/2004 due to habitual cross-border telework should be facilitated as much as possible; the competent authorities or the institutions designated by the signatory States conclude the following Framework Agreement:

Article 3 Applicable legislation Upon request, a person who carries out habitual cross-border telework

within the meaning of Article 1 of this Framework Agreement and is covered by Article 2, will be subject on the basis of Article 16 (1) of the Basic Regulation to the legislation of the State in which the employer has his registered office or place of business, provided that the cross-border telework in the State of residence is less than 50% of the total working time.

(2) This Framework Agreement covers persons to whom the legislation of the State of residence would be applicable as a result of habitual cross-border telework in application of Article 13 (1) (a) of the Basic Regulation in conjunction with Article 14 (8) and 14 (10) of the Implementing Regulation and who are employed by one or more undertakings or employers (hereinafter only referred to as ‘the employer’) which have their registered office or place of business in only one other signatory State.

(3) Without prejudice to Article 6, this Framework Agreement shall not cover persons who:

(i) habitually pursue an activity other than cross-border telework in the State of residence and/or

(ii) habitually pursue an activity in a state other than those mentioned in paragraph 1 and/or

(iii) are self-employed.

Article 2 Scope (1) Unless otherwise provided in this Article, this Framework Agreement covers all

persons to whom Article 16 (1) of the Basic Regulation can be applied, provided that their residence is in a signatory State and the registered office or place of business of the undertaking or employer is situated in one other signatory State.

Article 4 Procedure (1) A request under Article 3 of this Framework Agreement shall be submitted in

accordance with Article 18 of the Implementing Regulation. (2) This Framework Agreement does not cover requests, as referred to in paragraph 1, if such requests concern a period prior to the entry into force. (3) Without prejudice to paragraph 2 and Article 6, this Framework Agreement shall not cover a request as referred to in paragraph 1, if such a request concerns a period prior to the date on which the request was submitted, unless during this period social security contributions were paid into or the employee was otherwise covered by the social security scheme of the signatory State in which the employer has his registered office or place of business, and:

(i) the requested period prior to the date on which the request was submitted does not exceed three months, or

(ii) such request is submitted no later than 30 June 2024 and the period prior to the date on which the request was submitted does not exceed twelve months.

Article 5

Depository State

(1) A signatory State will be appointed as depository State which will:

(i) collect all signed copies of this Framework Agreement;

(ii) duly publish the Framework Agreement and;

(iii) inform all signatory States of relevant information.

(2) The signatory States shall forward to the depository State the Agreement signed by the competent authority or the institution designated by the signatory State.

(4) An agreement under Article 3 of this Framework Agreement may be applied for a maximum of 3 years at a time, with extensions possible upon a new request.

(5) The exchange of information concerning the individual cases under this Framework Agreement shall take place between the competent bodies via EESSI using LA_BUC_01 where the agreement of the signatory State of residence could be considered as pre-given.

(6) The competent institution of the signatory State whose legislation is applicable shall provide an attestation (PD A1) in accordance with Article 19 of the Implementing Regulation.

Article 6 Final Provisions (1) This Framework Agreement does not affect the possibility of concluding an

individual agreement on the basis of Article 16 (1) of the Basic Regulation in situations, which are not covered by Articles 2 to 4 in which the special situation of habitual cross-border telework could be taken into account on an individual basis. The signatory States agree that the lack of a concrete end date for structural [non- temporary] cross-border telework in such cases will not be used as a reason to refuse the conclusion of an individual agreement, which falls out of scope of this Framework Agreement, under Article 16 (1) of the Basic Regulation as an exception to Article 13 of the Basic Regulation. (2) This Framework

Agreement shall enter into force on 1 July 2023 as long as at least two States have signed it. It is concluded for a period of 5 years and shall be automatically extended each time for another 5 years. (3) In case a signatory State signs this Agreement at a later stage, it shall take effect for

said State on the 1st of the month following the signature. (4) Any of the signatory States may terminate its adherence to the agreement by giving 3 months' written notice to the Depository State. (5) This Framework Agreement may be terminated by agreement of all signatory States.

(6) The expiry of this Framework Agreement shall not affect the validity of agreements concluded on the basis of Article 3 as long as the prevailing facts do not change.

by the competent authority of Estonia or the institution designated by this signatory State.

Done at Tallinn on .................

Maret Maripuu

Director General

The Estonian Social Insurance Board