Which labor laws apply to international work?

The modern world of work is more mobile than ever before. Highly qualified professionals developing software in a Berlin loft today might find themselves leading a project in Madrid or Warsaw next year. In times of massive skills shortages and advancing digitalization, which has long since expanded " home office " into the "workation" model abroad, physical boundaries seem to be losing their significance. But while businesses crave flexibility and government migration policies often struggle to keep pace with the reality of global mobility, a legal complexity lurks in the background that many companies and employees underestimate. International labor law doesn't always follow the principles of freedom of thought, but often the harsh realities of the physical place of work.

For highly qualified migrants and international professionals in particular , the question of applicable law is not merely an academic debate, but a matter of survival. It concerns protection against dismissal , vacation entitlements , and social security. Many blindly rely on what is written in their printed employment contract. However, a recent ruling by the European Court of Justice (ECJ) makes it clear that while paper is patient, the reality on the ground determines one's fate.

The illusion of free choice of law in the employment contract

In the legal drafting of international contracts, there is often a prevailing belief that the so-called freedom of choice of law under the Rome I Regulation (Regulation (EC) No. 593/2008) offers absolute protection. For example, employers and employees agree that German law should apply, regardless of where the work is subsequently performed. At first glance, this seems to offer convenient planning security. However, the ECJ ruled in its landmark judgment of 11 December 2025 (Case C-485/24) It has been clarified that the employment contract alone is not sufficient. While a choice of law remains possible and legally permissible, it is by no means always decisive for the actual level of protection afforded to the employee.

In our legal practice, we frequently observe that highly qualified expats assume they can " bring along " their accustomed standards from their home country or the original contracting state. However, the ECJ ruling underscores a crucial principle of European employee protection: International employees must not be placed in a worse position by a choice of law than they would be under the mandatory legal provisions of the state in which they habitually work . This means that the mandatory protective regulations of the actual place of work always remain in place as a minimum standard. Therefore, anyone who is effectively working in a country with stronger dismissal protection can invoke this, even if a "weaker" law is stipulated in the contract.

The actual place of work as the legal anchor point

The crucial question for companies and skilled workers is therefore: Where does the main focus of the work lie? The European Court of Justice (ECJ) emphasizes that the applicable law depends primarily on reality. What matters is the answer to the question of where the work is actually performed and where the organizational integration takes place. In a world where work locations change over time and projects move across borders, this focus often shifts unnoticed. A new center of activity can alter the entire legal structure of an employment relationship .

This dynamic becomes particularly critical when employment relationships are terminated. When a dismissal is issued, the question inevitably arises as to which labor law actually applies. The last place of work plays a crucial role in the legal assessment. In addition to the physical location, judges consider other factors, such as the applicable tax and social security systems, as well as the employee's integration into the company structure. For those affected, this is often a double-edged sword: on the one hand, it protects against arbitrary decisions resulting from the application of "cheaper" legal systems; on the other hand, it creates enormous legal uncertainty if the documentation of work locations is incomplete.

Criticism of the administration's lack of flexibility

We expressly welcome the clarification by the ECJ, as it strengthens the protection of workers and prevents highly qualified professionals from being pushed into legal gray areas. At the same time, however, we must criticize the fact that German and European migration authorities often fail to provide the digital tools necessary to reflect this lived reality in an unbureaucratic manner. While the case law rightly focuses on "lived reality," authorities often remain entrenched in rigid jurisdictions tied to the first registered residence or the static contract text.

For a skilled professional whose high qualifications make them internationally sought after, this complexity presents a hurdle. Companies today must actively manage global mobility and cannot rely on outdated contractual clauses . Continuously documenting work locations and regularly reviewing contract terms is a form of corporate due diligence. A mere choice of law no longer offers security if it contradicts reality. We call for greater harmonization between labor law, social security law, and immigration law to maintain Germany's attractiveness as a location for talent.

Conclusion: Real-world practice trumps theory.

In summary, the ECJ ruling of December 11, 2025, serves as a clear warning to all stakeholders in the field of international employment. The decisive factor remains where the employment relationship is actually practiced . A choice of law clause in an employment contract is an important tool, but it must never lead to the undermining of mandatory protection standards applicable at the actual place of work. For companies, ignoring these facts can prove costly in the event of legal disputes. For employees, it means they can assert their rights where they perform their work.

How Visaguard can support you

As a specialized law firm for visa law and international mobility, we support you in navigating the complex requirements of cross-border work in a legally compliant manner. We review your employment contracts for compliance with current ECJ case law and help companies implement legally sound global mobility concepts. For highly qualified professionals , we offer comprehensive advice to ensure that your protected status remains intact even when working in different locations. Rely on our expertise so that your international career doesn't get derailed by legal pitfalls.

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