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Brexit effects for companies in Germany | Law

by archyw

The European Union and the United Kingdom signed a trade and cooperation agreement on December 24, 2020, which regulates their (trade) relations from January 1, 2021. What does this mean for German companies that post workers to Great Britain and for British companies whose employees are to work in Germany?

The EU and the UK have agreed not to lower the current level of labor and social security protection for workers if such a reduction in protection could affect trade or investment between the EU and the UK. The EU-UK Trade and Cooperation Agreement (TCA) cites as examples of such protection areas: Basic employee rights, fair working and employment conditions, health and safety at work and corporate restructuring. In contrast, changes in terms of employment may be permitted under the TCA without adversely affecting trade.

It is conceivable, for example, that the United Kingdom will amend the current legal situation established by the European Court of Justice, according to which vacation entitlements continue to arise even during an employee’s illness. Another possible adjustment, which should not affect trade or investments, would be that the vacation pay is no longer calculated on the basis of all components of the total remuneration (according to the current case law of the European Court of Justice), but only on the basis of the basic salary. Any breach of the aforementioned “duty to protect” may be the subject of consultation between the TCA parties and / or an investigation and review by a panel of experts.

Brexit agreement aims to ensure a level playing field

This concept reflects the shared will of the EU and the United Kingdom for a level playing field for open and fair competition and sustainable development in key economic areas such as labor and sustainable development Social policy, environmental or climate protection or subsidy control. For this purpose, the TCA provides for the possibility of unilateral compensatory measures in the event of significant deviations in the aforementioned areas, such as the introduction of customs duties, if these deviations would significantly impair trade or investments between the parties.

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What needs to be arranged before a business trip to Great Britain

Business trips by citizens of the European Economic Area (“EEA”, i.e. the EU member states and from Norway, Iceland and Liechtenstein) as well as Switzerland to the United Kingdom will continue to be limited to a limited extent without a visa or work permit for up to 90 days within a time frame of six months may be possible. This applies to activities such as participation in meetings or contract negotiations, trade fairs and exhibitions, purchasing events and after-sales and after-lease customer services.

For the actual entry procedure for nationals of the EEA or Switzerland at the UK border, it is recommended that employers provide their employees for short business trips with a letter describing the activities they will carry out in the UK and the duration of those activities and that the person does not carry out any activities that go beyond the scope of the business travel regulations. In addition, employees should, in particular, have evidence of their accommodation, financial security and return travel arrangements with them, if possible.

For employees from Germany, the so-called A1 certificates (documents that confirm the employee’s uninterrupted membership in the German social security system) will continue to be used for business trips to the United Kingdom. EEA nationals who wish to carry out activities outside of the activities permitted by the TCA must apply for a “Skilled Worker” visa. It should also be noted that from October 1, 2021, EEA nationals will be required to bring their passport with them when entering the United Kingdom. The German identity card will no longer be sufficient.

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Entering the EU from the UK

For business trips from the UK to the EU, in addition to the general rules for travelers, further requirements apply, such as entry regulations (document confirming the purpose and expected duration of the trip, proof of suitable accommodation and what is available for the trip Funds) as well as the requirement that travelers must have certain identification documents (for example, the passport has a validity of at least six months). If you are traveling from the UK to an EU country for less than 90 days within a 180-day period, you may, as in the reverse, do certain activities without a visa or work permit, such as attending a business meeting. If the stay is longer than 90 days within a period of 180 days, a visa may be required, depending on the specific circumstances.

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