Social security in case of labor performed inside and outside the EU

On 18 December 2025, the Court of Justice of the European Union (CJEU) ruled in case C-743/23 that work performed outside and within the EU must be taken into account when substantial part of the activities performed by an employee, and thus determining the law applicable to social security. 

Legal background 

Article 13(1) EU Regulation 883/2004: This provision dictates under which social security system the employee falls under. In the case the employee works in two or multiple States, they shall fall under the social security system of where they perform the ‘substantial part’ of their work. 

Article 14(8) Regulation 987/2009: This provision defines that less than 25% of the work performed in one Member State shall not constitute a ‘substantial part of the activities’ and thus does not lead to an employee falling under the social security system of that Member State. 

Facts 

A Swiss-based company hired a German resident to perform work in Switzerland (10.5 days per quarter), Germany (work from home 10.5 days per quarter) and in other countries outside of the European Union (rest of the quarter). 

The employee thus declared to the German Federal Association of Statutory Health Insurance Funds (GKV-Spitzenverband) that he performed less than 25% of his work in Germany and that he was enrolled in the Swiss social security system, where the company is registered. 

Issue 

The Germany authorities, relying on the laws mentioned above, did not take the work performed in States outside of the EU into account. They thus determined that the employee performed more than 25% of his work (50% in Switzerland, 50% in Germany) in Germany. Therefore, the employee would fall under the German social security system. 

The laws mentioned above did not clarify whether, when determining where the ‘substantial part of the activities’ performed by an employee who works in two or more States is and thus which social security system is applicable, the authorities should consider work performed outside of the EU ; or whether they should only consider the work performed within the EU. 

Ruling 

The CJEU ruled that Member States need to take into account the work performed outside of the EU when determining the substantial part of the activities performed by an employee who works in two or more States and thus which social security system is applicable. 

In this case, that means that the employee performed less than 25% of his work in Germany, and thus does not fall under Germany’s social security system but indeed Switzerland’s. 

Impact 

This judgment clarifies how the EU’s social security coordination rules apply in an increasingly globalised employment context, especially for cross-border and internationally mobile workers. 

This is a significant shift from some prior practice, where only work in EU/EEA/Swiss countries was considered. Employers and authorities now need to include third-country work in calculations when determining social security coverage.