The French Ministry of Labour, Employment and Economic Inclusion has released a circular on transnational posting of workers in the context of provision of services.
A comprehensive overview of legal grounds and practical application of the rules on posting of workers, the circular brings (more) clarity as to the relationship between EU law, national legislation, and national practice.
First, as an opening paragraph and with bold characters, it is clarified that the circular does not concern social security rules (the abrogated Circular of 5 October 2008 contains the same reference, however under the subchapter addressing the concept of mandatory rules of minimum protection).
In Bouygues travaux publics and Others (C-17/19, 14 May 2020, ECLI:EU:C:2020:379), clarifying that a Portable Document A1 binds the courts of the host Member State exclusively as regards social security coordination, the ECJ has recalled that the social security coordination regulations and the Posting of Workers Directive are hermetic legal instruments (ruling under Article 20 of the ECJ Statue -no new point of law).
There is still an open question (not addressed by a circular that concerns exclusively labour law): in its ruling of 6 November 2015 (ECLI:FR: CCAS:2015: AP00626), the French Cour de Cassation has held that a E101 certificate, represents the sole document certifying the regularity of the individual’s social security affiliation, and consequently, the only material evidence of a posting.
Can that wording be interpreted as: the only material evidence of a posting from the perspective of the social security coordination regulations?
The failure to hold the A1 certificate, triggers per se the breach of concealed employment by dissimulation of paid employment, regardless of if the employer complies with its obligations under labour law (see to that effect Article L8221-5 Labour Code). Provided that the failure to hold the A1 certificate (and, if the certificate is withdrawn by the competent authority of the home Member State or disregarded by a national court of the host Member State), triggers a situation of unlawful posting under labour law as well, the entire French labour law is applicable as of the first day, and consequently posted workers may claim additional rights.
However, in SA Bouygues Travaux Publics and Others (20 March 2017, 15/01327), after finding that “the preliminary question is that of the regularity of the posting and not that of the existence of social security coverage”, the Court of Appeal of Caen, assesses the regularity of the posting (labour law) on grounds of certain constitutive elements from Article 12 Regulation 883/2004.
On 12 January 2021, the Cour de Cassation confirmed the decision of the Court of Appeal (ECLI:FR: CCAS:2021:CR00024).
On another (positive) note, maybe embarrassed (inter alia) by the ruling of the Court of Appeal of Caen in SA Bouygues Travaux Publics and Others, the Ministry of Labour clarifies that in determining whether an undertaking genuinely performs substantial activities, other than purely internal management and/or administrative activities in the Member State of establishment, reference must be made to Article 4(2) Directive 2014/67/EU (our note: and not to Article 12 Regulation 883/2004 and Article 14 Regulation 987/2009-e.g. the ruling of the Court of Appeal of Caen contains a great deal of confusion between the social security coordination rules and posting of workers in the meaning of Directive 96/71/EC and its enforcing Directive 2014/67/EU).
Interestingly, as regards the determination whether a posted worker temporarily carries out his or her work in a Member State other than the one in which he or she normally works, Article 4(3) Directive 2014/67/EU is not cited, place being given to national legislation and practice. Overall correct, however, “the posted worker returns to or is expected to resume working in the Member State from which he or she is posted after completion of the work or the provision of services for which he or she was posted” from Article 4(3) Directive 2014/67/EU, is “slightly” amended to “must resume their activity with the company of origin” (significant nuance had given rise to a large number of administrative and judicial proceedings).
In the same context, “there is no maximum or minimum duration of posting”, however, the duration, “will vary from one day to several months” (?). Using the word “years” would amount to accepting the ECJ ruling in Schnitzer “services within the meaning of the Treaty may cover services varying widely in nature, including services which are provided over an extended period, even over several years, where, for example, the services in question are supplied in connection with the construction of a large building” (C-215/01, Schnitzer, 11 December 2003, ECLI:EU:C:2003:662).
Last but not least, only a brief reference to the second part of the first phrase of Article L 1262-3 Labour Code, “activity carried out within the national territory on a regular, stable and continuous basis”.
At least some guidelines (in the light of the ECJ case-law) are eagerly awaited, although “No provision of the Treaty affords a means of determining, in an abstract manner, the duration or frequency beyond which the supply of a service or of a certain type of service in another Member State can no longer be regarded as the provision of services within the meaning of the Treaty” (C-215/01, Schnitzer, 11 December 2003, ECLI:EU:C:2003:662).
Where the EU institutions made the choice not to make their views known and to suggest a line of action in the light of the ECJ case-law (recommendations under Article 288TFEU, without imposing any legal obligation), we cannot see why a Member State would be precluded from issuing such recommendations (in the light of the ECJ case-law).
The sole clear criterion must be considered to date is from the Cour de Cassation ruling of 12 January 2021 in Bouygues Travaux Publics and Others, notably the court “sovereign assessment of the facts and circumstances of the case” (ECLI:FR: CCAS:2021:CR00024- paragraph 63).
The court’s assessment is certainly sovereign, however, the legal grounds invoked must be at least coherent:
“Article L1262-1 of the Labour Code, in the version applicable to the present case, provided that an employer established outside France could temporarily post employees on national territory, provided that an employment contract existed between the employer and the employee and that their employment relationship subsisted during the period of posting.
This regulation, which is somewhat imprecise, but with the idea of a stable employment relationship prior to posting, must be supplemented by European standards (EEC regulations 883/2004, 987/2009, European Directive 96/71/EC). It follows from these data that the posted worker, for a limited period of time (24 months), must have, prior to the posting, carried out an activity in a Member State on behalf of an employer who normally carries out his activities there. The "normal" activity in the country of origin means a real activity which supports the economic life (or survival) of the undertaking, other than an activity of pure administration” (Court of Appeal of Caen SA Bouygues Travaux Publics and Others, 20 March 2017, 15/01327, pg. 31 -32).
These are (only) the opening paragraphs of the assessment had led to the conviction of Elco Construct for concealed employment.
Beyond the open-ended questions discussed above, the circular brings a genuine added value through its guidance as regards the terms and conditions of employment applicable to workers posted to France, employers’ obligations, and sanctions for failure to comply with the relevant legislation.