People engaged in cross-border work in the European Union (“EU”), the European Economic Area (“EEA”), and Switzerland will face a number of changes in the course of 2010, when the current EC Regulation 1408/71 regarding social security will be replaced by EC Regulation 883/04. Initially, the new Regulation was to become applicable from March 1, 2010, but it would now appear that it will happen on May 1, 2010.
The new Regulation’s most important effects are, in brief, as follows:
- Only one social security system can be applicable.
- Social security legislation for people working in several countries, including transport workers and airline staff, will probably be amended.
- Social security contributions and payments will be affected.
- The new Regulation will have consequences for the administration of social security systems:
* compliance: local registration and/or remittance procedures;
* implementation: secondment documents may require amending;
* structured electronic documents: the aim is to improve the exchange of information between the competent authorities; and
* declaration of secondment: the current E101 declaration will be replaced.
- Transitional provisions may only be called upon for people who are already insured.
It is essential that the effect of the new Regulation on the social security position of people engaged in cross-border work be fully explored to ensure a smooth transition to the new Regulation and to avoid any pitfalls. Taking stock of the consequences is necessary to the timely implementation of any administrative or budgetary amendments that may be required.