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ECJ ruling: Equal child benefit for migrant workers

Status: 06/16/2022 11:47 a.m

In EU countries, migrant workers must receive just as much child benefit as nationals. The European Court of Justice decided this – and described other regulations as discriminatory. The reason was an Austrian law.

EU countries must grant child benefit uniformly. The European Court of Justice (ECJ) has ruled that adjustment of payments for migrant workers from other EU countries according to the cost of living in the country of origin is inadmissible. The family benefits for migrant workers would have to correspond “exactly” to those for nationals, the judgment said.

Also no perks allowed

The reason given in the ECJ ruling was that the differences in purchasing power for residents were not taken into account for these services. Therefore, the consideration of corresponding differences between the EU countries is not justified.

According to the Luxembourg judgment, an adjustment of payments is also inadmissible in the case of benefits that the ECJ does not classify as “family benefits”. It’s about tax breaks for single parents or single earners.

Austria’s “adjustment regulation”

The background is that, under certain circumstances, foreigners in Austria have received less child benefit than people with Austrian citizenship. Affected are employees whose children reside permanently in another EU member state – for example because they live there with the other parent. Since 2019, Austria has linked state payments to the cost of living in the countries in which the children live.

If the cost of living in the country of origin is lower than in Austria, these benefits are reduced accordingly. However, the regulation also works in the other direction: the payments are increased if the cost of living in the country of origin is more expensive. According to the court, this case is rarer, since most migrant workers come from EU countries where the cost of living is lower than in Austria. Payments for children in Romania, for example, have been more than halved.

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Infringement action by the EU Commission

With the decision, the ECJ upheld a so-called infringement action by the EU Commission. If Austria does not comply with the judgement, the Commission can appeal again and request a fine. The child benefit regulation from 2019 was considered a prestige project by the then coalition government between the conservative ÖVP and the right-wing FPÖ.

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