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Claeys & Engels

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Applicable employment law in case of international employment -

October 2013

Court of Justice: place where the employee habitually carries out his work is not decisive

The place where the employee habitually carries out his work must be set aside if the agreement is more closely connected with another country. This principle even applies if the employee was employed for a (very) lengthy period and without interruption in the country of the place where he habitually caries out his work.

In the event of an international employment, parties are free to determine which law will govern their employment relationship. This choice of law however may not deprive the employee of the protection of the so-called objective applicable law.

On 12 September 2013 the Court of Justice rendered its judgment Schlecker (C-64/12), in which it clarifies that to determine the objective applicable law, priority should be given to the criterion ‘most closely connected' instead of to the criterion place of habitual employment. If an employee habitually works in country A, but the employment contract is more closely connected with country B, the law of country B should be considered as the ‘objective applicable law'.

The fact that an employee was employed for a lengthy period and without interruption (here: more than 11 years) in a certain country may not be considered as a more important criterion and does not mean that there is no closer connection with another country.

In this respect, the Court of Justice refers to the applicable social security and the applicable tax scheme. In addition, the parameters relating to salary determination (for example: pay scales) and other working conditions can also be taken into account.

> Action point
In the event of international employment, it must be checked to which country the employment relationship is the most closely connected.

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