Mercedes Puy, lawyer for the GD Global Mobility (Gesdocument) team, analyses in this post the new reality in the contribution system for posted workers: avoiding disengagement with Spanish social security:
Last Saturday, 22 July, the Official State Gazette published Order PCM/835/2023, dated 20 July, regulating the situation equivalent to registration in the Social Security system of working people posted abroad to the services of companies engaged in their activities within Spain.
This Order, which will enter into force on 1 November 2023, repeals the previous Order of 1982, updating the regulations on the scope and conditions of these workers, more than 40 years after its publication.
Meanwhile, following on from other events which have occurred in Spain since then, such as entry into the European Union (with the consequent application of the rules for the coordination of Social Security systems) and the signing of numerous bilateral and multilateral agreements with different countries around the world in this regard, requiring the drafting of a new text.
Posted persons may continue to contribute to the Spanish Social Security system.
The internationalization of companies and business practice, consisting of posting part of their workforce outside national territory, have also made this regulatory adjustment inevitable, the main objective of which is simply to ensure access to future benefits for all workers posted during that period.
There are four situations set out in the new Order:
- Movement of a worker to a country where no international instrument for the coordination of social security systems is applicable;
- Posting where, even if an international instrument is applicable, that person is not included within its scope of subjective application.
For these two cases, workers will be considered to be in a situation similar to that of registration in the Social Security system in which they were included, with the obligation to pay contributions continuing on the part of both the company and the posted workers, for as long as they remain in the country of destination and the employment relationship is maintained.
- Postings in which an international instrument is applicable after the expiry of the maximum duration foreseen for that instrument, including any extensions which may have been authorized, if these are provided for in the respective international instrument.
- Postings in which, although an international instrument is applicable, it does not provide for the posting of workers by their companies to the territory of the other party.
In these cases, posted persons may continue to be subject voluntarily to Spanish legislation, even if the maximum period of posting provided for in the respective international instrument has been exhausted, for the purposes of causing entitlement to the corresponding benefits (including contributory retirement benefit).
Although the Order will enter into force on 1 November 2023, companies with workers posted abroad on that date will have a period of 6 months to adapt to the new regulations.