“Business trip to the USA easier than to the EU”
Berlin Whether self-employed, small and medium-sized companies or large corporations – the economy complains about absurd administrative burdens by the EU bureaucracy. The accusation: On the one hand, onerous requirements come directly from Brussels, on the other hand, the national implementation of regulations is often not very practical.
The Family Business Foundation wanted to know specifically and had a comparative study carried out. Using an example: the so-called A1 certificate.
If employees are sent to another EU country – even if only for a short business trip – the employer must apply for such a certificate. It makes it clear that the employee is covered by social insurance in their home country.
The study is available exclusively to the Handelsblatt. Conclusion of the comparison of Germany, Austria, France and Italy: In this country, the registration process for each individual A1 certificate takes a lot of time and a lot of money.
In addition, there are longer waiting times before the certificate is issued. Rainer Kirchdörfer, Chairman of the Foundation for Family Businesses, says: “The burdens of everyday life, which tie up an infinite amount of energy and resources in our family businesses, become visible in a concrete example.”
A sensible idea has problematic consequences
There is actually a sensible idea behind the A1 certificate: With the form, employers do not have to pay social security contributions in several countries or deregister employees from the domestic insurance system for assignments abroad of a maximum of 24 months within the EU.
But the current study, which was created by the Centers for European Policy Network (CEP) and Prognos AG, in cooperation with the Regulatory Control Council of the State of Baden-Württemberg, shows the inefficiencies: since EU law says nothing about what information the application contains must contain on an A1 certificate, each country does what it wants.
ask like that Austria and Germany according to whether the worker was posted to the same Member State in the two months prior to the current posting. Austria and France want to know the start date of the employment relationship. In Italy the date of signing the employment contract must be indicated.
The study states: “All Member States examined require information that none or only some of the other Member States require. It is therefore very likely that all four Member States will be able to reduce the required information and thus the administrative costs.”
According to the study, in the pre-Corona year 2019, 4.6 million A1 certificates were issued in the EU member states. In Germany alone there were 1.8 million forms, significantly more than in Italy with around 216,000, Austria with a good 197,000 and France with around 126,000 certificates.
More about bureaucracy in Germany:
The “regulatory burdens” were measured on the basis of expert interviews. While the process is fully automated in France, Germany offers an online process. However, employee data cannot be saved and must be entered again and again by the company.
The result: The total time for applying for an A1 certificate differs “considerably” in all four countries, as the study states. In France and Austria it is around 19 minutes per process, in Germany around 26 minutes and in Italy even 32 minutes.
This total time for the application therefore means compliance costs per process of 6.80 euros in Austria, 7.12 euros in France and 10.28 euros each in Italy and Germany.
Approval times also vary. In France, for example, the form can usually be downloaded directly. Companies in Italy and Germany report longer waiting times, which hinders compliance with legal requirements.
Company complains about “medieval small states”
The industrial adhesives manufacturer Delo from Windach in Bavaria can also report on the difficulties involved in obtaining the A1 certificate. Here, the managing partner Sabine Herold calculated that it would cost 2.5 assistant positions to fill out all forms “100 percent perfectly” for all business trips.
In addition, there would be costs that would arise from following the legal situation, especially in management. The company’s conclusion: “It is easier to travel to the USA for a business trip than to the EU.”
And Indra Hadeler, Managing Director International Relations at the employers’ association Gesamtmetall, says: “Unfortunately, the rules on the free movement of workers in the EU, one of the cornerstones of the internal market, are still reminiscent of medieval small states.”
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In addition, the situation for companies has recently worsened again. Hadeler reports: “For some time, carrying an A1 certificate has been required in various EU member states such as France and Austria as proof of the alleged protection against undermining minimum working conditions and against undeclared work.” That fines would also be threatened if crossing the border no A1 certificate can be submitted no longer has anything to do with the original idea of the social security certificate.
Changes in Germany are not to be expected
The fact that states are now demanding the A1 certificate as proof of protection against wage dumping and undeclared work has also made Hubertus Heil (SPD) change his mind at the Federal Ministry of Labor.
In this country, until recently, reference was made to the settled case law of the European Court of Justice, according to which it is permissible to waive the certificate for short-term and short-term postings and to apply for it only if there are inquiries in the destination country. Now it says: Since individual countries are “comprehensively sanctioning”, this can no longer apply.
A change in the A1 madness seems a long way off. The traffic light coalition of SPD, Greens and FDP promised in their coalition agreement to “rapidly abolish” “unnecessary requirements” for A1 certificates by introducing a “European electronic real-time register”.
But when asked about the responsible Federal Ministry of Labor it says: “Since it is an EU legislative process, it is not possible to make a reliable forecast of the expected conclusion.” The EU Commission has not yet announced a proposal.
The opposition sees this attitude critically. The spokeswoman for economic policy union faction, Julia Kloeckner (CDU), told the Handelsblatt: “It cannot be that in larger companies an employee is only busy applying for so-called A1 certificates as proof of social security.”
The traffic light, like that Klöckner, have announced that they want to simplify processes and rules so that the economy has more time for its actual tasks. There should even be a new bureaucracy relief law. “So far, however, companies and citizens have been disappointed,” she said CDU-Politician. “After a year of traffic lights, there aren’t even any key points.”
In view of the study results, the Foundation for Family Businesses believes it is possible to make the A1 certificate “much more efficient” with simple measures. Accordingly, the applications could be made “leaner” in the short term and the German portal “more user-friendly”. This includes the fact that the information in the form for the same company and the same person only has to be entered once. If a posting lasts less than five days, there could be a simplified procedure.
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