Does the destination country's labour law apply to employees on a workation?

Employers allowing workations generally assume that the employee's home country employment law continues to apply and for most workations, that assumption holds. But the EU legal framework on this question is less settled than many realise. In a peer-reviewed paper recently published in the E-Journal of International and Comparative Labour Studies (ADAPT University Press, Volume 14 No. 03/2025), Dr. Martina Menghi, labour law specialist and Senior Manager at WorkFlex, and Pieter Manden LLM MBA, tax lawyer and Co-Founder of WorkFlex examined exactly this question.

‍Local employment rules of the destination country can, in certain circumstances, apply to employees working there temporarily. Here is what the research found.

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What counts as a workation?

The definition matters, because it directly determines which legal rules are in play.

A workation occurs when four conditions are met simultaneously: the employee chooses the destination and duration themselves; the employer permits but does not direct the remote work from abroad; there is no business reason behind the trip; and the employee bears the travel costs. If any of those conditions fall away, the employer assigns the destination, or there is a business purpose, the situation is no longer a workation. It becomes a business trip or, potentially, a posting, each carrying its own compliance obligations.

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The EU legal framework: Rome I

In EU law, the question of which country's employment law governs a contract is answered by Regulation (EC) No593/2008, known as Rome I. The Regulation applies universally, it is relevant whether the destination country is an EU Member State or not.

Rome I's starting point is that the parties choose the governing law of the employment contract. Employment contracts almost always specify this. The Regulation then places two limits on that freedom of choice, both of which are relevant for workations.

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Limit 1: provisions that cannot be derogated by agreement (Article 8)

Even where parties have chosen a governing law, that choice cannot remove the employee's protection under provisions that cannot be derogated by agreement, specifically, those of the country where the employee habitually works.

If an employee habitually works in Germany, German mandatory employment provisions apply to them regardless of what their contract says, and regardless of the fact that they are temporarily working from Spain or Portugal during a workation.

The CJEU has confirmed that these provisions can include rules on minimum wages. National courts have further identified rules on working hours, protection against unfair dismissal, and health and safety at work as falling into this category though these classifications come from national jurisprudence rather than a definitive CJEU ruling. There is also a scholarly debate about whether health and safety rules belong here or under the separate Article 9 category discussed below.

Since a workation is temporary by definition and does not change where the employee habitually works, these provisions remain those of the home country. The destination country's equivalent rules do not apply under Article 8. The risk through this route is, for a standard workation, very low.

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Limit 2: overriding mandatory provisions (Article 9)

Article 9 of Rome I introduces a separate and more demanding category: overriding mandatory provisions. These are rules a country considers so important to its public interest, its political, social, or economic organisation, that they apply to any situation within their scope, regardless of the law governing the contract. A host country can, in principle, require compliance with these rules from anyone working on its territory, even temporarily.

The Regulation is explicit that this category must be interpreted strictly and applied only in exceptional circumstances. Its practical importance, as legal scholars have noted, should not be overstated.

Neither the Regulation nor the CJEU has defined which employment law provisions qualify as overriding. National courts decide this case by case. French and Belgian courts have historically taken a broader view of what qualifies; German and Dutch courts a narrower one, though legal scholars do not fully agree even on that characterisation of the Dutch courts.

In practice, the areas most likely to be treated as overriding overlap substantially with provisionsal ready harmonised at EU level: working time, minimum leave, health and safety, equal treatment, and protection for pregnant workers. EU directives have created a shared baseline across Member States in all of these areas, which limits the real-world divergence between what different destination countries require.

Where significant divergence does exist, most notably in minimum wages and overtime rates, the legal position is more uncertain. Salary standards vary considerably across EU Member States, and remuneration rules are among the most plausible candidates to be treated as overriding by some courts. No court has applied Host State salary standards to a workationer to date, and the legal basis for doing so is thin. But the debate is open.

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Are workationers posted workers?

The Posted Worker Directive (96/71/EC) defines a hard core of Host State employment conditions, covering remuneration, working hours, rest periods, and others that must be applied toposted employees. These are treated as overriding mandatory provisions. The question is whether that hard core also applies to workationers.

On the basis of current law,the answer is no - for three reasons.

First, posting exists to facilitate the freedom to provide cross-border services. Workationers are not providing a cross-border service. They are not assigned by their employer to work for a recipient in another country. The trip is entirely privately driven.

Second, posting requires a service recipient in the host country. In a workation, no such entity exists. There is no host company, no client, no counterparty of any kind. The employee is working for their home country employer from wherever they happen to be.

Third, the formal registration requirements for posted workers confirm this distinction. Several EU Member States' posted worker registration portals require a host company name and a description of the service being provided. These fields cannot be completed for a workationer, in some portals, the registration cannot even be submitted if they are left empty.

One important exception: Belgium has adopted a broader national interpretation of "posting" under which any employee temporarily working on Belgian territory may be treated as posted, even without a service recipient. Employers allowing workations in Belgium should factor this in specifically.

The interpretation that workationers are not posted workers is shared by most legal scholars and practitioners, but it is not unanimous. Clarity through legislation or case lawis still needed.

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Which risks remain in practice?

Working hours are one area where a Host State court could theoretically intervene. One French ruling classified working hours as a provision that cannot be derogated rather than an overriding provision, placing it under Article 8 (home country rules) rather than Article 9 (host country rules). This debate is not settled across EU Member States.That said, given EU-level harmonisation on working time, the practical difference between destination countries is limited.

Remuneration remains the most sensitive area. Rules on minimum wages and overtime vary meaningfully across Member States. If a court were to treat these as overriding, a workationer on an Italian salary could, in theory, be subject to Swedish or Dutch minimum wage standards during their stay. No court has done this. But national authorities retain discretion, and the question remains legally open.

The risk increases with duration. A longer stay creates more exposure, more opportunity for an inspection or a jurisdictional connection to form. It is worth noting that the commonly cited 183-day threshold is a tax concept, not an employment law one.The two compliance dimensions are separate and should not be conflated.

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What this means for employers

EU law was not written with workations in mind. Rome I and the Posted Worker Directive both predate the remote work shift that followed the pandemic, and both were designed with different situations in mind. Applying them to workationers requires interpretation, and that interpretation is not yet settled.

Employers running workation programmes need to make deliberate decisions about duration, destination countries, and risk appetite. The legal framework does not provide a clean answer. What it does provide is a solid basis for concluding that, for most well-structured workations, the employment law of the destination country will not apply but the legal framework is not yet settled and for some workation setups, that uncertainty matters.

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