RS 02001.565 Detached Worker Rule - U.S. Portuguese Agreement
A detached worker is an employee who is sent by his or her employer in one country to work temporarily in the other country for the same employer or an affiliate of that employer.
B. POLICY PRINCIPLE — INITIAL DETACHMENT
Under the agreement, a detached worker remains subject only to the social security laws of the country from which he or she was sent, provided all of the following conditions are met:
The period of employment in the host country is expected to last no more than 5 years. The 5-year period is considered to begin with the date the employment in the host country begins or the effective date of the agreement (August 1, 1989), whichever is later.
The employment relationship must exist before the employee is transferred from the home country.
In the case of an employee who is sent by an American employer to become the employee of the company's affiliate in Portugal, the American employer must have entered into an agreement under Section 3121(l) of the Internal Revenue Code with respect to the affiliate.
NOTE: The detached worker rule applies even if an employee has not been sent directly from one country to the other but is first assigned to work in a third country.
C. POLICY PRINCIPLE — EXTENSIONS
The 5-year period can be extended if all of the following conditions are met:
the extension is requested before the end of the initial 5-year period
the extension will not exceed one year
both countries agree to the extension
Agreement under Section 3121(l) of the Internal Revenue Code, RS 01901.070