Cross-border provision of services in the future more complicated
One of the goals of the PWA is to prevent misuse in the field of the cross-border provision of services, resulting in more rigorous conditions for obtaining the A1 form, additional inspections, higher fines and regulation of cooperation in between countries.
The PWA is applicable to both Slovene employers and the self-employed who, on a temporary basis, provide services using posted workers in (one) other country of the EU, Norway, Iceland, Sweden or Lichtenstein and for employers or self-employed from listed countries, providing such services in the region of Slovenia. Posted workers or self-employed remain included in the social security system of the country where they normally work (i.e. in the country where the employer or the self-employed is domiciled) also for a time period of executing the service abroad.
The PWA further stipulates additional conditions for issuing the A1 form, which is also one of the conditions for providing cross-border services. These conditions include for example the obligation of the employer/self-employed to prove that the company is actually in business, that it is tax compliant, that in the past three years no more than one monetary fine was issued for breaches of employment rights, that an appropriate contract has been concluded between the worker for the duration of the posting and the contractor of the services or the related company etc. Where doubt arises as to whether an employer or the self-employer actually carry on a business in their home country or there is suspicion that this could be a “letter-box” company, an inspection can be made, and consequently A1 form can be annulled.
The wording of the PWA has already come in for a barrage of criticism from employers, especially with regard for the need for A1 forms where the work concerned is only a few hours work abroad. Given that it takes up to 5 days to issue the form, it will be impossible for service providers to provide services requiring a prompt response on their part.
Another important change brought about by the PWA is the introduction of subcontracting liability for contractors in cases where the foreign employer fails to settle its obligations towards employees posted to work in Slovenia. Where a foreign employer fails to settle its obligations in respect of a posted employee, the employee will be able to claim payment from the contractor i.e. the user of the services. Subcontracting liability will only be applicable in cases where the foreign employer is acting as a subcontractor executing construction works (in such cases the Slovene contractor will be liable for the obligations), or as an agency providing services to the contractors (where the user will be liable for the obligations).
The PWA further provides for mutual cooperation between bodies and entities with regard to sending and serving documents and decisions, cooperation with regard to the enforcement of penalties etc. The act is scheduled to enter into force as of 1 January 2018.
