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COUNTRY OF RESIDENCE MUST PAY CHILD BENEFITS IF ONE PARENT EMPLOYED THERE.

The European Court of Justice has ruled in a cross-border case involving two dual-nationality couples that as long as one parent is employed in the common state of residence, that state is primarily responsible for paying child allowance benefits. The preliminary ruling handed down in case C-543/03 on June 7 proves that there are exceptions to the principle that the state of employment is primarily responsible for payment of family benefits under Regulation 1408/71/EEC, which aims to ensure freedom of movement for workers and applies to the application of social security schemes to employed persons, self-employed persons and members of their families moving within the European Union.

Christine Dodl and Petra Oberhollenzer work in Austria but live in Germany with their husband and partner respectively, both of whom have German nationality and work full-time in Germany. Following the births of their children, both women took unpaid leave during which their employment relationship was suspended. Both fathers received the child allowance in Germany that corresponds to Austrian family allowance, but they did not receive a separate German national child-raising allowance because they were in full-time employment. But both mothers were refused this particular German allowance and its corresponding Austrian version in each case on the ground that the other member state was responsible for payment. So they challenged their Austrian health insurance provider, the Tiroler Gebietskrankenkasse.

An Innsbruck court (Oberlandesgericht) subsequently referred two questions to the ECJ: whether Ms Dodl and Ms Oberhollenzer had lost the status of 'employed persons' within the meaning of Regulation 1408/71, and which member state is primarily responsible for paying the family benefits. On the first question, the Court deferred to the national court to determine the facts. But irrespective of their status as 'employed persons' in Austria, it ruled on the second question that Germany would be responsible for paying each woman the child-raising allowance, as both had employed partners paying into the social security system in Germany. "The other partner effectively creates the link", said ECJ spokesman Christopher Fretwell. "Some social contributions are being made, so that creates a sufficient link to the country of residence."

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Publication:European Report
Geographic Code:4E
Date:Jun 8, 2005
Words:356
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