Posted Worker Compliance: Guide to registration requirements and digital transformation

The management of posted worker compliance is at a critical turning point. As cross-border work continues to grow across Europe and the world, employers face mounting pressure to effectively manage their posting compliance. The stakes are high – Luxembourg's recent enforcement actions resulting in €9M in fines for employer non-compliance in just one year  demonstrate authorities' increasingly serious approach to enforcement¹.

The European Commission has recently proposed the adoption of a unified posted worker portal that signals both an opportunity and a warning. While promising to reduce the administrative burden of posted worker notifications by up to 73%, the new digital system will create unprecedented transparency and opportunity of enforcement for authorities. Organizations managing cross-border work face a clear choice: modernize their compliance approach now or risk exposure in an increasingly digital enforcement landscape.

This article examines how the posted worker compliance landscape is changing, what these changes mean for HR and global mobility teams, and why waiting to adapt is not an option. Most importantly, it provides a clear path forward for organizations looking to turn this challenge into an opportunity for efficient, future-proof compliance management.

¹ Centre commun de la securite sociale (2023). Rapport Annuel 2023.

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1. What is a Posted Worker notification?

A posted worker notification is a mandatory registration requirement for employees working temporarily in EU or EEA countries. Required by the Posted Workers Directive (“PWD”), these notifications inform local authorities when workers enter their jurisdiction, enabling them to monitor compliance with local labor laws and protect workers' rights. Not all business trips require such a notification to be submitted. However, generally, this is triggered by a cross-border service provision. Please note that each country defines at the national level what is considered as a “service provision”, therefore activities are treated differently in each country and different exemptions might apply. As an example, Belgium even requires a PWD notification to be submitted for workations. Further, some countries only require a PWD notification to be submitted if the posting company is based in the EU, while in other countries it is required even for companies based in third countries. Employers must register their employees through country-specific portals before the trip begins. With different procedures and requirements across national legal systems, and significant penalties for non-compliance, these notifications have become a crucial consideration for any organization managing cross-border work in the EU and beyond.

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2. The current reality of Posted Worker management

2.1. The purpose and importance of Posted Worker notifications

For labor authorities, posted worker notifications serve as a crucial enforcement tool that enables them to protect both workers and fair market competition. These notifications provide authorities with essential visibility into cross-border work activities, allowing them to:

• Monitor compliance with local employment conditions, ensuring workers receive proper working conditions, notably including wages and appropriate working hours
• Verify social security coverage remains valid during the posting period
• Prevent social dumping and maintain fair competition in local labor markets
• Ensure posted workers receive all entitled protections in the destination country
• Track proper documentation for tax and legal purposes

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2.2. Complexity of Posted Worker registration systems

HR and global mobility managers in global organizations face a daunting task: managing posted worker notifications across 31 different systems² throughout Europe. For each destination, HR teams must learn to navigate a different notification portal, understand specific local requirements, maintain separate login credentials, and manage distinct submission processes. This creates a nearly impossible task without dedicated resources or technological support.

To illustrate this complexity, let's examine three national systems that demonstrate the varying levels of difficulty HR teams face in the image below. Germany stands out with an easy-to-use system to register posted workers, while Greece provides medium-level complexity, and Norway – highly complex posted worker registration process.

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² 27 EU member countries and 4 EFTA countries (Norway, Switzerland, Liechtenstein, Iceland)

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2.3. Administrative burden of registering Posted Workers

This complex landscape translates into significant administrative burdens for employers. Current studies indicate that businesses typically spend between €150-200 per posting on administrative costs alone, with processing times varying dramatically by country - from 21 minutes in Estonia to 61 minutes in Italy and up to 87 minutes in Greece per posting.

The administrative workload breaks down into three main categories:

• Data collection (17%)
• Data entry (33%)
• Document management (51%)

To put this in perspective, the German mechanical engineering industry, with its 205,000 registered postings annually, spends a minimum of €31 million yearly on administrative costs alone.

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2.4. Compliance risks and consequences of ignoring Posted Worker registration requirements

Despite the significant administrative burden, companies cannot afford to ignore these requirements. The consequences of non-compliance can be severe. Luxembourg recently demonstrated authorities' serious approach to enforcement by imposing €9M in fines for non-compliance in just one year.

The severity of consequences varies by country:

• Some countries initially provide warnings
• Others have strict regulations with immediate economic sanctions
• Fines for missing or late notifications (e.g. Switzerland imposes up to €5,000)
• Additional sanctions for working condition violations can exceed €50,000
• Service bans can prevent business operations for up to five years
• Companies may be published on shared labor authority lists, affecting reputation
• Practical consequences include workplace access denial, particularly in Scandinavian countries
• Reputational damages as an employer and as a company (e.g. in Switzerland major infractions will be published in an openly accessible online list)

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3. The European Commission's new Posted Worker portal initiative

3.1. Why is the Posted Worker registration portal proposed

The growing complexity of managing 31 different notification systems has not gone unnoticed by European institutions. In recognition of the significant administrative burden this place on businesses, while also acknowledging the challenges it creates for effective enforcement, the European Commission has proposed a unified solution: a single portal for all posted worker notifications across the EU. It is crucial to emphasize that this is a proposal and therefore it is not guaranteed at all yet, whether it will be adopted or not. Further, we must notice that the proposal only concerns the notification system. Specific national legislations will still be applicable even if such a proposal will be adopted. This notably concerns sanctions and consequences in case of violations, as well as particular requirements, meaning whether a notification will be required or not for specific activities performed by employees temporary working abroad. The Commission's proposal aims to streamline the process for businesses while simultaneously enhancing authorities' ability to protect workers' rights and ensure compliance.

Key features of the portal will include:

1. Single multilingual platform

• Access in all EU official languages
• Standardized terminology across countries
• Unified interface for all submissions

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2. Standardized processes

• Common data entry formats
• Unified submission procedures
• Standardized documentation requirements
• Consistent notification timelines

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3. Data storage and reuse

• Information retained for future submissions
• Employee data stored securely
• Company details saved for repeated use
• Historical posting records maintained

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4. IMI System Integration

• Connection to Internal Market Information System
• Enhanced data sharing between authorities
• Streamlined verification processes
• Integrated compliance checking

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3.2. Benefits and their implications: The two sides of Posted Workers' digital transformation

The Commission's proposed portal promises significant efficiency gains, but each improvement comes with new considerations for organizations managing posted worker compliance.

Streamlined data entry and enhanced visibility

‍The new system promises a 73% reduction in submission time through standardized forms and simplified processes. This will have as an immediate practical consequence, the creation of unprecedented transparency. Therefore, authorities will have immediate access to standardized, comparable data across all postings, making pattern recognition and compliance monitoring more effective than ever.

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Centralized data storage and cross-border sharing

‍The ability to store and reuse information will eliminate duplicate data entry and reduce administrative burden by 25%. This centralization also means that authorities across countries can easily share and cross-reference information through the Internal Market Information System (IMI), enabling coordinated enforcement actions.

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Standardized documentation and increased scrutiny

‍The elimination of country-specific documentation requirements will significantly simplify the submission process.  Increased standardization also means that compliance gaps become immediately apparent, as authorities can more easily compare documentation across different postings and organizations.

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Cost reduction and enforcement efficiency

‍While the elimination of administrative fees and reduced processing time will lower costs for businesses, it also reduces barriers for authorities to conduct systematic compliance reviews. What previously required manual investigation and coordination will become automated and instantaneous.

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This digital transformation means that organizations must approach their posting management with new considerations. Those that have historically struggled with compliance, underestimated its value, relied on manual processes, or taken a decentralized approach may find themselves exposed in this new transparent environment. The efficiency gains of the proposed portal could be significant, if at all introduced, but they will come with the expectation of higher compliance standards and more rigorous enforcement.

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4. Preparing for the digital transition of Posted Worker registrations

4.1. A timeline for change

The European Commission's proposal marks a significant step forward, but at the moment it is a simple proposal that might not lead to any new legislation. In any case, even if adopted, the transition will be gradual. While a specific launch date is yet unknown, we can expect a 13-month adoption process followed by a 2-3 year implementation period. With voluntary adoption by member states, organizations will likely need to manage both the new unified portal and existing national systems until at least mid-2026. Furthermore, it remains unclear how EFTA countries will engage with the proposed changes.

However, this implementation timeline presents both a challenge and an opportunity. While the unified portal is still some time away, the shift toward digital enforcement is already underway. Organizations that wait for full implementation before modernizing their approach risk falling behind in two critical areas:

• Managing current compliance requirements across 31 systems
• Preparing for the increased transparency of the future digital landscape

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4.2. Building Future-Ready Compliance

While organizations would appreciate the unified portal, compliance obligations demand attention today and will continue to do so in the future. Organizations must continue to navigate complex requirements across multiple jurisdictions. As discussed previously, the proposal only concerns the notification modality, but does not affect at all any other aspect related to PWD compliance:

Documentation management

Beyond basic notifications, organizations must maintain comprehensive records of employment contracts, posting agreements, social security certificates, and other essential documentation. These records must be readily accessible for potential audits and meet specific national requirements.

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Local law compliance

Each posting must comply with host country regulations, notably including:

• Equal pay requirements
• Working time regulations
• Health and safety standards
• Industry-specific requirements

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Multiple system management

During the transition period, organizations will need to manage both existing national systems and the new unified portal, creating additional complexity in documentation and compliance tracking.

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The key to managing these obligations, while preparing for the digital future lies in automation. Modern compliance management systems can help organizations:

1. Handle current multi-system requirements efficiently
2. Build digital-ready processes for the future
3. Ensure consistent compliance across jurisdictions
4. Create audit-ready documentation trails

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4.3. Automation in action: The WorkFlex approach

WorkFlex's solution demonstrates how automation can transform posted worker management from a burdensome manual process into a streamlined, future-ready operation. The system integrates seamlessly with existing business travel processes to:

1. Automatically assess the applicability of notification requirements when travel is booked
2. Generate and submit required notifications
3. Manage documentation across jurisdictions
4. Ensure compliance before travel begins
5. Maintain comprehensive audit trails

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This automated approach not only addresses current challenges but positions organizations for success in the coming digital enforcement landscape. By implementing such solutions now, organizations can:

• Reduce current administrative costs
• Ensure consistent compliance across systems
• Build digital-ready processes
• Prepare for increased transparency
• Create scalable, future-proof compliance management

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The transition to digital enforcement is inevitable. Organizations that act now to modernize their compliance approach will not only manage current requirements more efficiently but will be well-positioned for success in the increasingly digital future of posted worker management.

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