The European Court of Justice (ECJ) has delivered a landmark judgment in Case C-743/23 (GKV-Spitzenverband) that reshapes how social security coverage is determined for employees working across multiple countries. Traditionally, social security obligations under EU law were assessed based on employment activities within the European Economic Area (EEA) and Switzerland. However, the ECJ’s recent ruling clarifies that all employment activities—including work performed in third (non-EEA) countries—must be taken into account when deciding which social security legislation applies. This decision has major implications for employers with mobile or remote workforces, and raises questions about compliance, coordination agreements, and A1 certificate practices under EU social security rules.
1: Background — The GKV-Spitzenverband Case
In the case at the heart of this ruling, an employee who lived in Germany worked for a company established in Switzerland, dividing his work between Germany, Switzerland, and countries outside the EEA. A German social security institution initially determined that German social security rules applied, because the employee appeared to spend a “substantial part” of his work time in Germany when considering only EEA and Swiss activity.
The employee challenged this, arguing that all his employment activities—including those outside the EEA—should be counted. Including time spent outside Europe reduced his German work percentage below the 25 % threshold used to determine social security coverage under EU regulation.
2: What the ECJ Ruled
The Court held that:
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- All employment activities must be counted when assessing whether a worker carries out a “substantial part” of their activity in their country of residence — not just activities in the EEA and Switzerland.
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- The concept of “activity” in EU social security coordination law therefore extends to work performed globally.
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- If the work in the country of residence does not reach the relevant threshold once all activity is included, the social security scheme of the employer’s country applies instead.
This interpretation aligns with the basic goal of the EU’s coordination rules — to ensure consistent application of a single social security scheme for any mobile worker and to avoid overlaps or gaps in coverage.
2: What the ECJ Ruled
The Court held that:
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- All employment activities must be counted when assessing whether a worker carries out a “substantial part” of their activity in their country of residence — not just activities in the EEA and Switzerland.
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- The concept of “activity” in EU social security coordination law therefore extends to work performed globally.
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- If the work in the country of residence does not reach the relevant threshold once all activity is included, the social security scheme of the employer’s country applies instead.
This interpretation aligns with the basic goal of the EU’s coordination rules — to ensure consistent application of a single social security scheme for any mobile worker and to avoid overlaps or gaps in coverage.
📌 3: Why This Ruling Matters
🔹 1. Broader Scope of Work Considered
Employers and authorities must now include work performed outside the EEA and Switzerland when determining applicable social security legislation. This can change which country’s system is deemed responsible — sometimes shifting coverage away from the employee’s country of residence to that of the employer.
🔹 2. Impact on A1 Certificates
The ruling raises questions about how existing A1 certificates (which confirm applicable social security legislation for posted or mobile workers) will be treated. It is not yet clear how national authorities will adapt their application and monitoring systems to include third-country work time.
🔹 3. Compliance Challenges
Employers need to reassess:
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- current mobility arrangements,
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- documentation of cross-border work,
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- how remote or hybrid work patterns affect social security liability.
Monitoring work outside the EEA adds complexity, especially where telework or international travel is common.
📌 4: Ongoing Uncertainties
While the ECJ decision is binding, some uncertainties remain:
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- Coordination agreements, such as the Framework Agreement on cross-border teleworking, do not currently factor in work outside the EEA — it is unclear how the ruling affects these agreements.
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- The implications for EU-UK social security coordination under the Trade and Cooperation Agreement are also not yet fully known.
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- Member States may differ in how they interpret or implement the ECJ’s guidance on monitoring work outside the EEA.
📌 5: Practical Takeaways for Employers
✔ Review mobility policies: Ensure documentation captures all work activities, especially outside the EEA.
✔ Reassess social security decisions: Recalculate whether residence or employer country coverage applies under the broader definition of “activity.”
✔ Prepare for regulatory changes: National authorities may update A1 certification procedures and questionnaires.
✔ Seek expert guidance: Work with legal and social security specialists to align compliance strategies with evolving interpretations.
Conclusion
The ECJ’s ruling in Case C-743/23 marks a significant shift in how social security coverage is determined for multi-state workers — broadening the scope of employment activities that must be counted and potentially changing applicable jurisdiction. For employers with cross-border or remote workforces, the ruling underscores the need for careful planning, meticulous documentation, and proactive compliance strategies. As Member States respond to this decision, businesses should stay informed and adaptive to ensure continued compliance with EU social security coordination rules.