Cross-border commuting

Updated : 12/2012

Problem areas

Common problems for cross-border commuters include:

Differences in social security systems

Social security systems vary widely within Europe.

Find out about the social security system in the country where you are going to work or live and avoid misunderstandings with potentially serious consequences:

National social security systems

Some EU countries do not pay survivor's pensions. If your husband or wife works across the border and you are counting on the possibility of a survivor's pension, check whether they exist in that country.

Entitlements and conditions

Entitlements vary between EU countries. For example, you might be entitled to 24 months' unemployment benefits in the country where you work but only 12 months' in the country where you live.

Regarding unemployment benefits, you should pay special attention to:

required periods of work;
rates used to calculate benefits;
time limits for benefits.

The amount of benefit you receive may vary greatly when you work in another country. This is especially true for family benefits: some countries have no parental benefits schemes at all.

Overview of family benefits by country

Required period of work

In many countries, you are entitled to social security benefits only if you have worked for a certain number of years in that country.

The country from which you claim social security benefits must take account of periods you have worked in other EU countries as well - on the same terms as if you had been working there.

Supplementary pension rights

Supplementary pensions are retirement, survivors' or invalidity pension schemes designed to supplement or replace statutory state pensions.

Before you sign up for a supplementary pension scheme, you need to check how moving/living abroad will affect your pension rights. If there are any adverse effects, these are illegal under EU law.

If you leave a supplementary pension scheme because you stop being a cross-border commuter, you have the same rights as people who stay in the same country but stop paying contributions — for example because they change jobs.

Example

Fred worked for 8 years in country A for a company which had a generous supplementary pension package.

He found a job in another country and started working for an employer who also offered a supplementary pension package.

Fred left the supplementary scheme in country A but the insurer told him that his acquired rights would not be preserved if he started working in another country.

Fred contacted a European consumer centre and obtained legal support. In the end, his previous insurer agreed to preserve his contributions in country A.

Pension companies sometimes penalise people who stop working in the country where they contracted their scheme, by refusing to pay pensions, charging additional costs or requiring them to refund interest earned during the saving period.

This is illegal — if it happens to you, you can call the European consumer centres.

Differences in retirement ages

In some EU countries, you will have to wait longer to start drawing your pension than in others. Find out in advance, from all the countries where you have worked, what your situation will be if you change the date when you start claiming your pension. If you take one pension earlier than the other, it might affect the amounts you receive.

You can get more advice from the relevant authority in the country where you live and/or in the countries where you worked.

Sample story

Be aware of different (later!) retirement ages in other countries

Louise from Austria worked in Germany for 15 years, then worked again in Austria towards the end of her career. When she turned 60, she applied for her pension, as is usual in Austria, but only got a very low one.

At 60, Louise is only entitled to the Austrian part of her pension. She will receive the German part when she turns 65 — the legal retirement age in Germany.

Bank account for salary payments

Your employer might want you to open a bank account in your country of employment to pay your salary.

Inside the eurozone — Your account in your home country should be sufficient and your employer cannot force you — provided both your country of residence and country of employment are in the eurozone.
All your employer needs to transfer your salary — without any additional costs — is the IBAN and BIC numbers for your bank account. Banks cannot charge more for international bank transfers in euro than for purely national transfers. Only if a cross-border transfer exceeds the €50 000 threshold, the bank can charge more.
If you live or work in a country outside the eurozone, it might be legitimate for your employer to require you to have a local bank account if he can prove that it will cost him more to transfer your salary abroad.

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