France making headway in the implementation of the posted workers directive

The 1996 Posted Workers Directive (96/71/EC) entitles posted workers to statutory employment rights in the country they are posted to.  Posted workers are individuals who are employed in one European Member State but sent by their employer to work temporarily in another Member State before returning home.

The 2014 Enforcement Directive (2014/67/EU) builds on the information exchange requirements in the 1996 Framework Directive to support cross-border enforcement between Member States and also covers monitoring and compliance

There are three scenarios in which the Posting of Workers Directive applies and these are set out in Article 1 (3) of the Framework Directive.  In summary:

• When an employer posts a worker to another Member State on his own account and under his direction, under a contract which the employer has concluded with the party in the State for whom the services are intended;
• When an employer posts a worker to an establishment or to an undertaking owned by the group in the territory of a Member State; and
• When the employer, being a temporary employment undertaking or placement agency, hires out a worker to a user undertaking established or operating in another Member State.

For all of these scenarios the employment relationship between the employer and the posted worker must be maintained for the duration of the posting.

Obligations for posting workers in France

This directive was transposed in France in July 2014 with follow up regulations in April 2015.  The Macron Act (enacted in August 2015) increased the obligations applicable to companies posting employees or using employees in France, as well as the level of sanctions in case of breach of these obligations.

Foreign companies posting employees in France are subject to various obligations, including:

• The filing of a declaration with the French labour inspection prior to the posting which must be:
  • Drafted in French,
  • Filed before the employee arrives in France,
  • Provide detailed information with respect to the employees, their job duties, salary and working hours, the conditions in which the employer pays for travel and housing expenses and the link between the employer and the host company.
  • Submitted electronically, in a format to be determined in an upcoming decree.

In addition, employers should note that:

• A representative for the foreign company based in France should be an appointed, who will be liable for all relations with the French authorities.
• The host company is also liable for ensuring that the foreign employer of posted workers comply with these obligations.

Finally, one has to remember that any company entering into a service agreement for an amount higher than €5,000 must ensure that its sub-contractor complies with the rules against undisclosed work, including with respect to social security coverage.

Increase of maximum applicable fines

In the case of breach of such obligations by the employer or the host company, administrative fines of €2,000 per employee (€4,000 in case of recurrence within one year) would apply, with a cap originally set at €10,000.  The Macron Act has increased this cap dramatically to €500,000 – empowering the French authorities with highly valuable means of action.