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The Minimum Wage of the EU Country to Be Paid to Expat Employees

The Minimum Wage of the EU Country to Be Paid to Expat Employees

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According to a decision of the Court of Justice of the European Union made on 8 July 2021, Hungarian employees can make claims before the Hungarian courts against their Hungarian-based employer for breaching the minimum wage rules of the Member States where they are posted.

The ruling follows Hungarian lorry drivers who brought a lawsuit in a Hungarian court against their employer, who “appeared to be based in Hungary”, claiming that their wages at the time of their employment in France were not equal to the French minimum wage, but that they were paid the basic minimum wage under their Hungarian employment contract, which is about the third of the French minimum wage.

The Hungarian court asked the European Court of Justice whether Hungarian employees can rely on a breach of the French minimum wage rules in France before the Hungarian courts against their Hungarian-based employer.

In the decision, the European Court of Justice recalls that the EU Directive on the posting of workers applies to all cross-border services involving the posting of workers, including road transport, in particular the transportation of goods. Consequently, the possibility to enforce the terms and conditions of employment and working conditions under the Directive should be given to employees, including the minimum wage condition.

Based on the decision, in general, employees may sue their employer in Hungary for breaching the domestic minimum wage requirements of an EU country where they work as ex-pat employees. However, as a prerequisite, the Hungarian court must examine whether the employer has its seat or domicile in Hungary under Hungarian law.

By Rita Parkanyi, Partner, KCG Partners Law Firm

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