The respective EC Directive 96/71/EC (Directive) had been put in place in order to enhance the free provision of services within the Member States, and its aim was to provide for mandatory rules guaranteeing a minimum protection in the respective host country where the workers are sent to.
In the following case, the determination of such minimum protection and the question of whether a Member State may also choose to ask for compliance with all rules on the protection of workers, i.e. rules exceeding a minimum protection, proved to be difficult. There were several decisions of the European Court of Justice (ECJ) on this matter, one of them being the 2006 decision Commission v Luxembourg (C-319/06), in which the ECJ ruled that Luxembourg had, among other things, failed to fulfil the obligations set out in article 3.1 of the Directive because its laws on the posting of workers exceeded what was required by such article. In fact, Luxembourg law required, as a pre-condition of posting workers to Luxembourg, the existence of a written employment contract for each worker and the registration of each worker with the social security authorities in their home country, including any family members, if applicable, in the respective country. Further, it required compliance with its national part-time and fixed-term work regulations, as well as with its rules on automatic adjustment of wages reflecting changes in the costs of living. Finally, Luxembourg law required the depositing of various documents giving information on the workers to be posted with ad hoc representatives who were supposed to keep such documentation at the disposal of Luxembourg authorities for an unlimited period of time, and a notification to the Luxembourg authority “Labour and Mines Inspectorate”.
The various ECJ rulings including the one cited were partly acknowledged and partly criticized, on the national level by the Member States and on the European level by various institutions such as the European Trade Union Confederation.
In 2008, the European Commission initiated a “Recommendation on Enhanced Administrative Cooperation” with regard to the posting of workers, and, in the following years, the European Social Partners wrote a report on the existing jurisprudence of the ECJ, which was published in 2010, and came to the conclusion that, given a certain amount of controversy in its jurisprudence as to the questions on minimum rules and rules exceeding the minimum protection, the Directive needs to be revised in order to ensure the application of the same rules in the country of origin and the host country.
In the meantime, national legislators can still choose between guaranteeing a minimum protection of posted workers in their country and the application of the full protection as it applies to their own workers.
Luxembourg reacted to the cited ECJ decision by a modification of its law on the posting of workers by amending some of its rules. Hence, the duration of the posting of workers may not exceed 24 months and the scope of such works must be determined before the works start. Exceptions with regard to the duration are still possible but these must be applied for at the relevant authority in the home country, not in Luxembourg. Further, the required documentation on the posted workers need not be deposited with an ad hoc representative anymore, which sometimes proved to be quite costly for the foreign enterprise under the old law. Such documentation must still be provided, but it may be lodged with any person of the enterprise’s choice, so for example at the place in Luxembourg where the works are executed, and only during the actual duration of the works, so that the Luxembourg authorities may examine all required documents at any time during the performance of the works. With regard to the workers’ remuneration, it is not required anymore to adjust these each time an automatic adjustment of wages takes place in Luxembourg; only the provisions on minimum salary have to be respected (and therefore only the automatic adjustments of such minimum salary need to be applied to the posted workers). Provisions on the further conditions such as the existence of written employment contracts and registration with the national social security agencies have however not changed. Temporary workers who are made available to the enterprise by an agency, as well as workers whose employment is based on employee leasing agreements, are also permitted; in these cases, the agency or the employer who sends his leased employees is in charge of complying with the Luxembourg laws on the posting of workers.
Therefore, some of the former provisions have been changed by the Luxembourg legislator in order to comply with the ECJ legislation, but it can be expected that the required revision of the Directive, once a decision has been taken on whether or not to oblige the Member States to limit their respective laws to the minimum required to guarantee the fundamental rights of posted workers or to allow for laws exceeding these, will lead to a further revision of Luxembourg law with the aim of establishing corresponding rules among the Member States.