Among foreign service providers operating in France, there is a common belief that A1 certificates issued to their employees by the social security institution of the home country serve as immunity against sanctions from French regulatory authorities and courts.
Under French law and jurisprudence, however, the reality is more nuanced.
- What Is the Role of the A1 Certificate ?
European regulations define the coordination of social security systems to ensure that employees moving within the European Union remain subject to the social security system of a single member state, avoiding overlapping national regulations and associated complications.
According to Article 11(3) of Regulation (EC) No. 883/2004 of April 29, 2004, on the coordination of social security systems, the general rule is that the applicable law is that of the state where the work is performed. However, under the interpretation of this provision, an employer based in an EU member state can post employees to France while remaining subject to the social security system of the home country.
The legality of a foreign company’s situation and that of its employees is confirmed by the A1 certificate issued by the social security institution of the employer’s home country.
For compliance inspections by French authorities, a foreign company must provide A1 certificates for each posted worker.
As part of their duty of vigilance, a French contracting entity must obtain A1 certificates from its subcontractor before work begins and subsequently every six months throughout the contract duration.
- What Is the Legal Force of the A1 Certificate ?
The A1 certificate holds particular legal authority. The Court of Justice of the European Union (CJEU) has confirmed that unless the A1 certificate is withdrawn or declared invalid by the issuing institution, it remains bindingin the national legal order of the member state where the worker is posted (CJEU, April 27, 2017, A-ROSA Flussschiff, C-620/15).
In a ruling on March 2, 2023, the CJEU reiterated that even if an A1 certificate is temporarily suspended, it does not lose its binding effect and continues to apply in legal proceedings. The court clarified the procedural steps a member state must follow if it questions the validity of such certificates (CJEU, March 2, 2023, C-410/21).
- Can French Authorities Challenge the A1 Certificate ?
At the request of French authorities, the social security institution in the home country of posted workers may invalidate their A1 certificates.
In case of a dispute over the validity of an A1 certificate, inter-state dialogue procedures have been established to facilitate its withdrawal when necessary.
The French Court of Cassation has ruled that a criminal judge, handling a case of undeclared work due to failure to register with social security authorities, may invalidate A1 certificates only if, based on specific evidence gathered during the judicial investigation, it is established that the certificates were fraudulently obtained and that the issuing institution failed to act upon a withdrawal request within a reasonable timeframe (Crim., September 18, 2018, Appeal No. 13-88.631, Bull. crim. 2018, No. 160; Crim., March 2, 2021, No. 19-80.991, published in the bulletin).
If the issuing institution withdraws the A1 certificates or fails to respond within a reasonable period, the foreign employer will be required to pay social security contributions in the host country.
As for the French contracting entity, it may be held liable for ensuring compensation for undeclared work under joint and several liability rules. If, despite warnings from French labor inspectors about the presence of unregistered workers in France, the French contractor fails to instruct the employer to rectify the situation immediately, it may be sanctioned (Cass. Soc., November 4, 2020, No. 18-24.451).
Due to the strict nature of this obligation imposed on French contracting entities, they often terminate or suspend contracts with European subcontractors upon receiving a notification from local labor inspectors.