Brexit: Social Security Coordination

Lengthy discussions between the government of the United Kingdom and the European Commission have finally led to the establishment of the Trade and Cooperation Agreement. Among other things, the document includes a Protocol on Social Security Coordination. Starting 1 January 2021, most “new” situations relating to the movement of persons between the UK and EU member states (hereinafter the “EU”) will be treated the same as the “old” situations to which EU regulations on social security coordination were applied and which can from now on be covered by the EU-UK Withdrawal Agreement.

Although many of the provisions included in the Protocol are similar to the current EU regulations on social security coordination, there are certain key differences that individuals as well as employers should be familiar with, as explained below.

What does the Protocol mean in practice?

According to the Protocol, who do the provisions on social security coordination concern?

The Protocol applies to all EU citizens, nationals of the UK and third countries, stateless persons and refugees lawfully staying in the UK or in the EU who:

  • are in a situation that contains an element of cross-border relations relating to the UK and an EU member state starting 1 January 2021 or later; and
  • are not subject to the conditions of the EU-UK Withdrawal Agreement.

The Protocol also applies to the family members of these individuals.

 What does this mean for cross-border workers moving between the UK and the EU?

1. The workers that the Protocol concerns will only be subject to one social security system at a given time, usually in the country where they are working at the given moment. Special provisions apply to “posted workers” and workers performing activities in several states.

2. The Protocol stipulates social security obligations for employers the same way as the current EU social security regulation. This means that employers in the EU and in the UK are obliged to register with the respective authorities with the purpose of paying employer and employee contributions in line with the relevant national legislation.

3. Special regulations concerning posted workers relate to postings that last up to 24 months, and they are very similar to the current rules for posted / temporarily assigned workers that are part of the EU regulations. However, each EU member state must report whether or not they are planning to abide by this rule. The deadline for reporting is 1 February 2021. The Czech Republic will be implementing these regulations.

4. The provision on workers performing activities in several states indicates that individuals should be entitled to social security coverage under the same principle as applies to the current EU regulations.

5. The Protocol does not include a clause on extraordinary circumstances that corresponds with Article 16 of the current EU regulations concerning social security coordination. This means that for postings exceeding two years, a certificate and insurance coverage from the home country is not available. 

6. Measures concerning the mutual provision of healthcare should be introduced and they should, to a large extent, correspond with those currently in place; although in practice, there are certain aspects that still require clarification.

From the Czech Republic’s point of view, citizens of the UK may continue to use European health insurance cards (EHIC) when in need of urgent healthcare during a short-term stay. The existing European cards issued by British institutions remain valid and it is not necessary to apply for a new document. In the future, the UK will probably be introducing a new global health insurance card (GHIC).

EU citizens with the right to reside in the UK as of 31 December 2020 may apply for a new EHIC card valid also in the UK (UK EHIC). The government of the UK continues to recommend that individuals arrange suitable health insurance with sufficient healthcare coverage.

7. The Protocol includes provisions that deal with coordinating and safeguarding most social security benefits between the UK and the EU. These should mostly remain effective in line with the principles stipulated by the existing EU regulations. However, there are some exceptions, particularly in respect of family benefits – including child allowance – and long-term care benefits. Access to these benefits will depend on national legislation, which may not guarantee the same level of benefits to the persons concerned.

The Protocol does not apply to countries belonging to the EFTA, ie Norway, Iceland, Liechtenstein and Switzerland. The conditions for providing social security benefits between the UK and these countries will be governed by the existing bilateral social security agreements (with the exception of Liechtenstein, where no agreement was concluded with the UK).

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