Global mobility and HR update

Social Security  

EU reform of the A1 certificate: simplification or new compliance challenges?

Following almost ten years of negotiations, the EU reached a political agreement in April 2026 on the reform of social security coordination. A key element concerns the A1 certificate  and thus directly affects the day-to-day work of HR and global mobility teams.

Whilst the reform may at first glance appear to reduce red tape for business travel, a closer look reveals a more nuanced picture: simpler rules for clearly defined cases  but significantly stricter requirements throughout the overall process.

Why the reform was necessary

Under current EU law, there is no general exemption for short business trips. The A1 certificate is therefore generally required even for very short or one-day assignments  including meetings, conferences, or even last-minute client visits lasting just a few hours.

In practice, this leads to considerable challenges:  

• High administrative burden even for one-day meetings
• Variations in how national authorities handle the process
• Legal uncertainty for businesses
• Millions of applications per year

The reform responds to the growing importance of short-term, international mobility.

The key planned changes

For the first time, the reform introduces clear, statutory exemptions from the A1 requirement, thereby creating greater legal certainty for certain forms of cross-border work. The focus is on the terms ‘business trip’ and the ‘3-day rule’.  

In the following two cases, the obligation to obtain an A1 certificate generally does not apply, although the construction sector is excluded from this.  

1. Exception: business trips

With this reform, the term ‘business trip’ is explicitly includedin Regulation 987/2009 for the first time. It covers temporary activities carried out in the employer’s interest, such as attending meetings, conferences, seminars or training courses.  

In future, these  assignments  will be exempt from the A1 requirement,  regardless of their duration. Even stays lasting several days or weeks, such as a two-week internal conference abroad, would therefore no longer be subject to reporting.

2. Introduction of the “3-day rule”

In addition, a further exemption is being introduced. Activities that do not fall under the definition of ‘business travel’ will also benefit from these relaxations, provided they are of a very short duration.  

• The exemption applies to assingments that Last no more than 3 consecutive working days
• Take place within a 30-day period

In these cases,the A1 requirement will also no longer apply.  

3. Day-One Compliance

For all cases not covered by the exceptions, significantly stricter rules will apply.  The A1 certificate must be applied for before the journey begins. Retrospective applications  will be severely restricted,  with a clear focus on proactive compliance.

What is changing in practice:

• The A1 certificate must be available before the journey begins (“Day-One Compliance”)
• Retrospective applications are severely restricted  
• Mandatory prior assessment of all cross-border activities
• Authorities will carry out more checks and apply stricter enforcement  

Challenges for businesses  

Although the reform introduces targeted simplifications, it simultaneously imposes new and significantly increased requirements on businesses in terms of planning, processes and compliance.

1. Classification of activities

Businesses must clearly categorise every trip and determine whether it is a business trop or an operational activity.  

• This is often difficult in practice, and there is a real risk of misclassification. 

2. A1 before departure (“Day-One Compliance”)  

For all cases not exempt, the A1 certificate must be applied for before the start of the journey.

• This will make spontaneous trips significantly more complicated

3. Tracking of travel data

The “3-day rule” requires a precise overview of the duration and frequency of stays

• Difficult to implement without digital systems

4. Increased requirements for documentation and evidence  

Companies must be able to demonstrate at any time why an A1 certificate is not required  

• This will increase the administrative workload, particularly in borderline cases

5. Shift towards proactive processes  

In future, compliance must be managed in advance,  no longer retrospectively

• This requires clear processes, guidelines and collaboration between HR, Travel and Legal

When will the changes come into force?

The current status:

• April 2026: The Council of the EU and the European Parliament reached a compromise in trilogue negotations
• 2026 (planned): Formal adoption by the EU institutions is planned
• 2028: The new regulations are expected to enter into force  

Until then, the existing rules will continue to apply, including:

• A1 requirement for cross-border activities
• No explicit exemption for business travel

What should you do now?

Early preparation is beneficial. We recommend that you develop a pragmatic, efficient and legally compliant solution,  tailored to your organisation and your mobility structure by:

• Analysing current processes and identifying risks  
• Defining clear guidelines for classifying overseas assignments
• Establishing or optimising A1 and compliance processes (Day-One Compliance)
• Establishing appropriate tracking and governance structures  
• Training HR, mobility and specialist departments

Conclusion

The EU reform of the A1 certificate brings targeted simplifications for clearly defined business trips but at the same time imposes higher requirements on planning, classification and compliance.

The key shift: 
A shift from a flexible, often reactive approach to a structured, forward-looking ‘Day-One Compliance’.

For companies, this means: 
In future, success will depend on actively managing overseas assignments, documenting them transparently and reviewing them at an early stage.

Author: Gordana Muggler  

Tax  

International staff assignments and permanent establishment risks  

In an increasingly globalisedworking environment, international secondments, short-term project assignments and cross-border remote working have become part of everyday business.. Whilst HR and global mobility teams often focus on tax, employment, immigration and social securityaspects, one key risk is frequently overlooked. Th8is ist he unintentional creation of a permanent establishment abroad.  

What is a permanent establishment and why is it relevant?

From a tax perspective, a permanent establishment arises when a company has a fixed place of business in another country or carries out activities there that are consideredto be sufficiently substantial. This may already be the case if employees work abroad on a regular and long-term basis  even without their own office or branch.

As a result the company may become liable for tax in the country where the activities are carried out. This applies in particular to:

• Corporation tax on profits generated there
• Extended compliance obligations (e.g. registration, tax returns)
• Possible income tax and social security implications

Typical risk scenarios in day-to-day operations

Many permanent establishment risks arise unnoticed in day-to-day business operations. The following situations may present particular risk:  

• Long-term secondments
• Working from home abroad
• Sales and contract conclusion on site
• Project work and construction/installation assignments

Why is this issue often overlooked?

There are several reasons why permanent establishment risks are underestimated in the context of HR and mobility:

• Focus on individual taxation rather than corporate tax
• Silo mentality between HR, Tax and Legal
• Lack of transparency regarding work locations and duration

Unclear responsibilities regarding remote working

The potential consequences

Failure to identify and manage these risks  can have significant consequences:

• Additional tax payments and interest
• Penalty surcharges or fines
• Reputational risks  in dealings with the authorities
• Increased administrative burden at a later stage  

In many cases, the risk is only identified during tax audit,  often several years later.

What HR and Global Mobility should do now

To manage these risks proactively, a number of fundamental measures are crucial:

• Establish early detection: Implement processes that identify international assignments at an early stage (e.g. approval processes for remote working or secondments)
• Close coordination with the tax department: Regular communication between HR, Global Mobility and the tax department is essential for jointly assessing risks
• Establish clear guidelines: Define the conditions under which employees may work abroad  and when a tax audit is required
• Raise awareness among managers: Line managers should understand that even short-term assignments abroad can have tax implications
• Ensure proper documentation: Accurate documentation of activities, duration and roles whilst abroad is crucial for tax assessment

Conclusion

International employee assignments open up valuable opportunities for companies and strengthen global collaboration  yet at the same time, they can also create complex tax issues. The potential creation of a permanent establishment is one of the most challenging issues in this area.  

For HR and global mobility teams, close and early collaboration with tax experts helps to identify risks and make well-informed, sound decisions to avoid unpleasant surprises.

Author: Gordana Muggler  

Employment law  

Travel time abroad: What employment law really says

Many HR managers assume that business travel time is generally considered working time. However, under employment law, this is not automatically the case for travel abroad.  

The key legal point

Article 13 of Ordinance 1 to the Labour Act (ArGV 1) states the following regarding travel time abroad:  

If an employee travels abroad in the course of their work, the time spent on the outward and return journeys within Switzerland shall be regarded as working time, at least to the extent specified in paragraph 2. If the outward or return journey takes place wholly or partly at night or on a Sunday, the employee’s employment during this working time does not require authorisation. The 11-hour rest period must be granted immediately after the return journey; it begins to run upon the employee’s arrival at their place of residence.

The provision clearly states:

• Only travel time within Switzerland is treated as working time. This includes the parts of the outward and return journeys that take place in Switzerland This applies at least to the same extent as  the employee’s normal journey to work  

Example: 
An employee travels from Zurich to New York

• Zurich → Zurich Airport: counts as working time
• Flight Zurich → New York: not automatically working time (unless work was carried out)
• Transfer abroad: not necessarily working time (unless work was carried out)

The law deliberately leaves room for interpretation. In practice, creates scope for flexibility but also uncertainty.

Typical risks from an HR perspective

Without clear regulations, legal and cultural tensions can quickly arise:

• Inconsistent practices can be interpreted as unequal treatment
• A lack of regulations leads to implicit entitlements
• International teams often expect standards that differ from the Swiss minimum

The risk lies less in breaching the law  and more in a lack of transparency and consistency.

What HR should do in practice

Rather than relying solely on the minimum requirements of employment law, it is advisable to adopt an active and structured approach to travel time abroad:

1. Understand the legal framework

Not all travel time is automatically working time. The decisive factor is whether employees are bound by employment law during this time or are actually working.

2. Define clear  company-specific policies 

Establish binding guidelines, such as:  

• Credit only during regular working hours
• Partial compensation (e.g. 50 %) outside working hours
• Flat-rate compensation models for longer or frequent journeys

3. Prioritise fairness over the minimum

Many companies deliberately go beyond the statutory minimum standards. Particularly  in the context of  skills shortages, the way in which travel time is handled is increasingly becoming an employer branding consideration.

4. Ensure transparency and legally compliant documentation

Set our the relevant policies clearly in the documents such as:

• Staff regulations
• Employment contracts (where relevant)
• Global mobility or travel policies

5. Empower managers 

Ensure that line managers understand the policies and apply them consistently.  This is the only way to avoid unequal treatment.

Conclusion  

Defining clear, fair and practical arrangements at an early stage can help prevent disputes relating to overtime, fairness and equal treatment.    It can also strengthen the organisation's position as an attractive employer over the longer term.

Authors: Emina Husejnovic-Selimovic and Quentin Eiselé