Social security coordination

What it means

Social security coordination is the set of EU rules that decide in which country a person working across borders is insured and ensure that insurance periods from different countries are added together. The rules do not harmonise benefit levels; they only determine which system applies.

The basic principle is that a person is insured in only one country at a time, usually where they physically work. This prevents double contributions as well as situations where someone is insured nowhere. The rules apply in the EU, the EEA countries and Switzerland.

The second principle is aggregation of periods. If someone worked five years in Slovakia and ten in Austria, both insurance periods count when assessing pension entitlement. Each country then pays a proportional part of the pension based on how long the person was insured there.

How it works in practice

When posting workers to another country, the employee can remain insured in Slovakia for up to 24 months. The proof is the A1 form, issued by the Social Insurance Agency, which the employee should carry in case of an inspection.

If a person regularly works in several countries, they are insured in their country of residence if they perform a substantial part of their activity there, usually at least a quarter. Otherwise they are insured where the employer is based. Working from home for a foreign company can thus move insurance to Slovakia.

A cross-border worker who lives in Slovakia and works in a neighbouring country is insured in the country of work. They can use healthcare in both countries, and when staying in another EU state they show the European Health Insurance Card.

What to watch out for

Coordination covers social security and health insurance, not income tax. Tax is governed by double tax treaties, which have different rules, so a person may pay contributions in one country and tax in another. The two questions must be dealt with separately.

A missing A1 form can lead authorities abroad to demand contributions in their own country during an inspection. When working in two places at once, such as employment in one country and self-employment in another, the applicable legislation should be settled in advance to avoid arrears.