Family benefits cannot vary according to children’s country of residence
Austria will have to review its family benefits legislation. In his opinion, the Advocate General of the Court of Justice pointed out that EU law on the coordination of social security systems “is based on the general idea that, if a migrant worker pays social contributions and taxes in a Member State, he or she must be able to benefit from the same allowances as nationals of that State”.
In its judgment, the Court of Justice takes the view that the “adjustment mechanism, which is based on the criterion of the children’s residence abroad for determining the amount of the family benefits and social and tax advantages, affects migrant workers more” and “therefore constitutes indirect discrimination on grounds of nationality, which is permissible only if it is objectively justified”. Which it is not.
This “difference in treatment is neither appropriate nor necessary for the purposes of ensuring the supportive function and the fairness of the social system”. (see CJEU, 16 June 2022, Case 328/20, Commission v. Austria and press release). The self-employed workers’ trade union Vidaflex emphasises that this decision, which it had fervently hoped for, primarily concerns workers who spend 24hrs/day looking after one of the 35,000 people in Austria who require home care.
It calls on the government to review its legislation as soon as possible, and to compensate the workers concerned (see article on APA OTS). The Austrian trade union confederation ÖGB “has warned that index-linking is illegal under EU law and condemned the dangers of making unrealistic calculations”, which were intended to produce annual savings of 114 million euros from the State’s budget. A reply to a parliamentary question submitted in May 2022 indicated that Susanne Raab (ÖVP), who is Austria’s Minister for the Family, had already earmarked 220 million euros to cover subsequent payments.
(Published in IR Notes 189 – 28 June 2022)
