Key Takeaways
- Spain and 17 EU nations signed an agreement allowing cross-border teleworking, and safeguarding employment rights.
- Workers telecommuting under 50% of their time can select social security from their home or employer’s country.
- Enables living in one EU country while working under another’s labor regulations, fostering a diverse digital nomad community.
- 18 nations, including Spain, Germany, Switzerland, and France, committed to this pioneering agreement.
The rapid global shift towards remote working, greatly expedited by the COVID-19 crisis, is noticeably influencing Spanish and wider European legislative decisions.
A year ago, in 2022, Spain introduced the “Startups Law”. This pivotal legislation welcomed non-EU contract workers and freelancers, allowing them to work from Spain or even launch a business remotely.
These individuals were provided preferential tax conditions and an exclusive digital nomad visa tailored to their profession.
According to a report published by The Local, fast forward to July 1, 2023, Spain, along with 17 EU counterparts, embraced a unified agreement.
The goal? To make teleworking (or ‘teletrabajo’ in Spanish) within Europe smoother while ensuring workers can still exercise their employment rights from their homeland. This agreement can be located under Article 16(1) of the European Commission’s Regulation No. 883/2004, which discusses ‘cross-border teleworking’. The specifics were officially disclosed in the Spanish Official State Gazette (BOE) on August 4.
Breaking Down the Agreement
What it Entails
The report noted that the groundbreaking pact permits Europeans to be employed in one country and work remotely from another, all while safeguarding their employment privileges and social security entitlements.
Now, cross-border workers who telecommute from their EU domicile for less than 50% of their work duration can opt for their home’s social security structure or their employer’s. This marks a shift from the earlier stipulation, where if one worked for 25% or more in their residence country, they were bound by its social security system.
This is the illustration per the report: Consider an individual working in Spain for a Swedish enterprise. This individual can immerse in Spain’s vibrant culture and lifestyle for six months while adhering to Swedish labor norms, encompassing remuneration and social benefits.
Essentially, they’d mirror an in-house employee in Sweden, possibly even working from a scenic balcony in Seville for under half their stipulated hours.
The endgame? A dynamic European digital nomad community, fortified by consistent legal safeguards, empowered to reside in any Member State and work from another.
Signatory Nations
The report noted that the government’s BOE reveals 18 signatories to this accord: Spain, Germany, Switzerland, Liechtenstein, Czech Republic, Austria, Netherlands, Slovakia, Belgium, Luxembourg, Finland, Norway, Portugal, Sweden, Poland, Croatia, Malta, and France.
Every EU Member State, including Iceland, Switzerland, and the UK, has been cordially invited to partake.
Key Stipulations
The report noted that the pact comes with a set of criteria. Workers must be:
- Employed singularly by a signatory state company.
- Not engaged with another firm or self-employed.
- Working under 50% of their hours in their residence nation.
- Party to a teleworking accord with their employer, lasting between one and three years (extendable based on national guidelines).
Moreover, cross-border workers wishing to stay in Spain must enlist as digital nomads to secure a residence visa. Nevertheless, their employment and social security ties would remain with their employer’s nation, provided other conditions are met.
What We Think
This European teleworking agreement marks a significant step toward a more flexible work landscape, facilitating cross-border employment within the EU while upholding workers’ rights and social security entitlements.
The framework enables a balance between residing in one Member State and working from another, fostering a dynamic and diverse digital nomad community across Europe.
The collaboration among signatory nations sets a precedent for progressive employment policies, catering to the evolving needs of a remote workforce in the modern era.
Learn more in the entire The Local report.
