New Legislation on Posted Employees

In January 2018, the Transnational Provision of Services Act, which regulates the posting of employees to and from Slovenia, was enacted. The law establishes requirements for both local and foreign employers handling employee postings abroad, with the intention of preventing violations of basic rights.

The Transnational Provision of Services Act legislation is the first attempt by the Slovenian government to regulate in greater detail the posting of employees in response to the fact that companies—which were formally registered in Slovenia but were in practice providing services exclusively abroad —had been violating basic employment rights.

Under the new regulations, Slovenian employers wishing to post employees to perform services abroad are required to obtain an A1 certificate. In addition, foreign employers wishing to perform services in Slovenia are required to register the performance of services, as well as each posted employee, with the Employment Service of Slovenia. Employers must submit all applications online.

The conditions that must be met to receive an A1 certificate and to register foreign employers are identical. Employers are required to prove that they ordinarily perform services in the country of origin, have a (mostly) clean record regarding labor offenses, the services to be performed form part of their registered business activities and will be performed through one of the allowed methods of engagement, and the posted employee does not ordinarily work in the country of posting.

Additionally, the law requires foreign employers to obtain an A1 certificate in their countries of origin, designate a responsible officer in Slovenia to liaise with Slovenian authorities and to keep records and documentation relating to posted workers in the place where the services are performed, and do so for up to 24 months following the conclusion of business activities.

In cases in which foreign employers provide services as construction subcontractors, the main contractor is liable for the payment of any salaries due to posted employees in the event of the foreign employer’s failure of payment. The same applies to foreign employment agencies providing employees to Slovenian employers.

Comment

The TPSA provides some much-needed clarity for both Slovenian and foreign employers regarding an issue that was previously under-regulated and arbitrary. However, comparable legislation on the employment of foreigners that contains similar wording on statutory conditions to be met by employers resulted in significant confusion about how to prove compliance with statutory requirements in practice. Thus, it remains to be seen if the Transnational Provision of Services Act will serve to truly reduce administrative barriers.

Written by Žiga Dolhar and Simon Tecco of Wolf Theiss and Roger James of Ogletree Deakins