Posting of foreigners to work abroad

Every entrepreneur operating on the Polish market notices that a pressing problem at present is the lack of "hands to work". In fact, in practically every industry there are staff shortages. More and more often they are supplemented by hiring foreigners. Particularly employees from the Ukraine. In this article, I will present the legal regulations on the employment of foreigners. I will briefly outline the principles on how it should look like posting of foreigners to work abroad.

Principles of employment of foreigners in Poland

First of all, it is important to remember that there is a fundamental the difference between employing a worker from countries belonging to:

• European Union, hereinafter referred to as the "EU", Member States of the European Free Trade Association (EFTA) - Parties to the Agreement on the European Economic Area or of the Swiss Confederation, a
• the employment of a worker from a country not belonging to the above-mentioned communities.

In the first case, employment is in principle unlimited and follows the same rules as for Polish citizens.

On the other hand, the rules for the employment of foreigners, i.e. non-EU employees, are set out in the Act on Foreigners of 12 December 2013 and the Act on Employment Promotion and Labour Market Institution of 20 April 2004. Relevant regulations are also provided for by international agreements defining the rules of bilateral cooperation between states. The employment of a non-EU foreigner is covered by a special procedure. During it, he/she obtains both a residence and work permit. This procedure is not complicated. However, it consists of several stages, the passage of which may prove tedious and time-consuming.

On the legalisation of the stay of foreigners in Poland, I wrote in the article: Procedure for legalising the stay of foreigners in Poland and How to legalise an illegal stay of a foreigner in Poland? In this respect, we invite you to use the services of our law firm. We will guide you through this process "quickly and painlessly". In the following, however, I offer an explanation of two issues which, in my experience, you will often find interesting.

Posting of foreign nationals - where to start?

Considering posting of foreign nationals to work outside Poland, we should always familiarise ourselves with the regulations in force in the country to which we are posting. Of course, first we should make sure that our employee as a foreigner has a legal basis for employment in Poland. However, work permits for foreigners issued in Poland are valid only on the territory of Poland. Therefore, some EU countries (e.g. the Netherlands) require such a permit to be obtained on the territory of their country. This issue is not straightforward, so it is worth checking the relevant regulations carefully.

Posting of workers from Ukraine to Germany

The German market has recently been developing very dynamically. For this reason, there has recently been a need to fill the labour shortage. This is possible, among other things, by posting them from Poland. How to legally carry out the procedure, which is posting of foreign nationals to work? First of all, you need to obtain a so-called Vander Elst visa. You can apply for a Vander Elst visa at the German embassy in Warsaw. Without it, the residence of a non-EU foreigner will be considered illegal. Obtaining such a visa exempts the employer from the obligation to have other work permits for its foreign employees on the territory of the country to which it is posting employees. What conditions must be met? It is important to note that:

• The foreigner should have an employment contract with the Polish employer. The Polish employer, on the other hand, should conclude a service contract with the German recipient of the posted workers.
• The Polish employer must provide the posted worker with at least the minimum wage - currently in force in the host country of the posted workers.
• The posting must be of an occasional nature. Otherwise, the foreigner must be in possession of a work permit in Germany.

Foreigner's insurance - what rules apply?  

The answer to this question is 'it depends'. The situation is different for posted workers and for those who actually perform work in more than one country at the same time.

Regulation 883/2004 is now the legal basis for EU coordination of the social security systems of the Member States of the European Union. At first sight, its provisions may appear enigmatic and incomprehensible. I will briefly try to explain the most important rules of the insurance system.

The regulation states that employees are subject to social security in the country where they actually work.  This is known as 'the'. workplace principle.

At the same time, we are dealing with the principle of so-called single applicable legislation according to which a person who carries out many different professional activities on the territory of at least two Member States is subject to the social security of only one Member State (Article 11(1) of the aforementioned Regulation No 883/2004). Therefore, one cannot be subject to the social security systems of two Member States at the same time. A person who migrates for economic purposes to another Member State is, in principle, subject to the social security of the State in which he or she pursues an activity as an employed or self-employed person.

Foreign nationals' insurance - exceptions

However, it should be remembered that two exceptions operate in this respect. These concern the following situations:

• posting of a worker to perform work in another Member State (Article 12(1) of Regulation No 883/2004),
• the transfer of a self-employed activity to another Member State (Article 12(2) of Regulation No 883/2004).

In both situations indicated above, a person who pursues an activity as an employed person in a Member State on behalf of an employer which normally carries out its activities there, and who is posted by that employer to another Member State to perform work on behalf of that employer, continues to be subject to the legislation of the first Member State, provided that the anticipated duration of such work does not exceed 24 months and that the person is not sent to replace another posted person. The same rule also applies to persons who are self-employed.

In cases where a worker performs his/her work in more than one country at the same time (Article 13 of Regulation 883/2004), it is possible to apply one of two connecting factors:

• the employee's place of residence or
• the place where the company employing the employee concerned is established.

According to Article 13(1) of Regulation 883/2004, a person who pursues an activity as an employed person in two or more Member States is subject to:

1. (a) the legislation of the Member State of residence if he/she pursues a substantial part of his/her activity in that Member State or if he/she is employed by various undertakings or various employers whose registered office or place of business is in different Member States, or
2. (b) the legislation of the Member State in which the registered office or place of business of the undertaking or employer employing him or her is situated, if that person does not pursue a substantial part of his or her activities in the Member State of residence.

How should we understand the phrase 'substantial part of the paid work' carried out in a Member State?

In this case, it is a quantitative factor. In order to determine whether a substantial part of the work is carried out in a Member State, it is necessary to take into account, in the case of paid work, the working time or the remuneration. As an overall assessment, meeting the above criterion in a proportion of less than 25 % indicates that a substantial part of the work is not performed in the Member State concerned.

Posting of foreigners to work abroad - summary

Issues related to employing and posting foreigners to work abroad are, as can be seen, a very broad and complex subject. Therefore, when taking action to this end, it is always advisable to have adequate knowledge of the procedures applicable both in Poland and abroad. Issues relating to the insurance system can be particularly confusing. On this and other matters, I encourage you to contact me.