New Developments in European Labour and Employment Law ... · New Developments in European Labour...

New Developments in European

Labour and Employment Law:

What Employers Need to Know

February 21, 2013

Presenters

Moderator

Sasha Štěpánová, Associate,

Kocián Šolc Balaštík, Prague, Czech Republic

[email protected]

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mailto:[email protected]

Presenters

Speakers

Catherine Barker, Managing Associate,

Addleshaw Goddard, London, England

[email protected]

Sascha C. Kuit, Associate, Boekle de Neree,

Amsterdam, Netherlands

[email protected]

3



Presenters

Speakers

Jan Tibor Lelley, Partner, Buse Heberer

Fromm, Essen Germany

[email protected]

Sophie Pelicier Loevenbruck, Partner,

Fromont Briens, Paris, France

[email protected]

4



Presenters

Speakers

Chiara Muston, Associate, Grimaldi Studio

Legale, Milan, Italy

[email protected]

Magdalena Pilarska, Associate,

Miller, Canfield, Paddock & Stone, P.L.C.,

Gydnia, Poland

[email protected]

5



New EU Data Privacy Laws

6

Data Privacy – Germany

European and national framework for

employee data privacy in the

European Union:

• The Data Protection directive 95/46/EC

of October 24, 1995

– Protection of individuals concerning the

processing of personal data and on the

free movement of such data

– Harmonisation of data protection within

the European Union

7


• Germany: Federal Data Protection Act

(BDSG)

• United Kingdom: Data Protection Act

1998

• France: Act No. 78-17 of January 6 1978

on data processing, data files and

individual liberties (loi relative à

l’informatique, aux fichiers et aux libertés

(the DPA)), as amended, notably by the

Act No. 2004-801 of August 6 2004

8


How EU and national agencies

enforce data privacy regulations

• Data protection authority in the EU:

– The European Commission

– The Working Party

– The European Data Protection

Supervisor (EDPS)

9


• National data protection authorities

– Germany: The Federal Commissioner for

Data Protection and Freedom of

Information (Bundesbeauftragter für den

Datenschutz und die Informationsfreiheit).

– United Kingdom: Information

Commissioner’s Office

– France: National Commission on

Computers and Liberties (Commission

nationale de l’informatique et des libertés) 10


Recent data privacy incidents in

Europe:

• Lidl case (large retail chain)

– Was monitoring its employees secretly

by cameras and detectives (2008)

– Found out private details about its

employees

– Lidl did not stop spying on its

employees even after the scandal

11


• Lidle (cont’d)

– Consequence: Lidl was ordered to pay

a total fine of € 1,462,000; separate

fines for different stores of between €

10,000 to € 31,000

– In 2009, Lidl created a new scandal by

recording the illnesses of its employees

in their files

12


• Deutsche Bahn case

– Employer was spying on its employees

and their family members to investigate

allegations of corrupt business practice

(2002-2005)

– Was monitoring the complete e-mail

communication of its employees (2007)

– Consequence: Several managers were

terminated and the company was ordered

to pay a fine of € 1,1 Million

13

Data Privacy – France

• Data privacy is protected by the CNIL

(National Commission on Computers and

Liberties/Commission nationale de

l’informatique et des libertés), whose role

is to inform employers and employees of

their rights and duties, protect, control,

regulate and punish.

– Financial sanctions up to 300 000 €,

– Public warning

– Suspension of the monitoring system 14


• Compared to Germany, the CNlL

seems to be more inclined toward

prevention and symbolic sanctions.

• Nevertheless, there are a lot of

“hidden costs” when projects are

suspended because they are not in

compliance with the rules.

15


• French procedure for database or

monitoring systems :

– Before implementation, the employer has to inform and consult the Works Council and Workplace Health and Safety Committee ( CHSCT), and make a declaration to the CNIL.

– The employer then has to inform the employees about the data collected.

– The data collected has to be strictly necessary to the activity.

16

Data Privacy – Poland

• The new laws probably will not directly

affect the employees’ situation – the

introduction of additional means of

protection in Member States is not

excluded in the draft Regulation.

• The catalogue of information that may

be required by employers from the

employment candidates is set forth in

the Labor Code.

17

Data Privacy – Poland

• Currently there are no indications that

the General Inspector for the Protection

of Personal Data will adopt a less strict

approach regarding the protection of

employees’ personal data.

• Requiring information other than what

is permissible, as well as non-

employment due to information on the

employee may be considered

discriminatory.

18

Data Privacy – Italy

• The employer is prevented from

gathering and processing any

personal or sensitive data that is not

relevant to assess the professional

attitude of the employee or

candidate.

19


• Personal data may be processed by

employers only with the employee’s

written consent.

• Consent not required if the processing

is necessary to comply with obligations

imposed by the law, regulations, and

EU legislation or for the performance

of obligations resulting from a contract

to which the employee is party.

20


• Sensitive data may be processed only

with the employee’s written consent and

the Data Protection Authority’s prior

authorization.

• Consent not required (but still subject to

the DPA’s authorization) if the

processing is necessary to comply with

specific obligations and/or tasks laid

down by laws, regulations or EU

legislation in the employment context.

21

Data Privacy – UK

• Current data privacy issues in the

UK

– ICO enforcement

– Blacklisting of workers

– Press and the Leveson inquiry

22

Data Privacy – UK

• The new EU data privacy laws and

how government agencies will be

aggressively enforcing these rules

– UK Government's view of the

Regulation

– Information Commissioner's position

23

Data Privacy – Netherlands

• The processing of personal data is

governed by the Personal Data

Protection Act (DPA) 2001

• Processing of personal data

requires prior notification to the

Dutch Data Protection Commission

• Specific provisions re data traffic

outside EU

24

Data Privacy – Netherlands

• New EU privacy legislation

• No reporting obligation, but own

resonsiblility

• Independent national privacy

authority; more powers

• EU rules also apply to data traffic

outside EU

25

Workforce Reductions,

Redundancies, and

Reorganizations

26

Workforce Reductions – UK

• When do you need to collectively

consult?

– "Proposing to dismiss" as redundant

20+ employees

– At one "establishment"

– Within a 90-day period or less

– As of April 2013, fixed-term workers

to be excluded from numbers

27


• Who should you consult?

– Appropriate representatives of the

affected employees.

– Affected employees? Employees

affected by the proposed dismissals/

related measures.

28


• Who should you consult? (cont’d)

– Appropriate representatives?

Trade union representatives

Standing employee representatives

Elected employee representatives

• Notification to the Secretary of State

29


• What should good consultation look

like?

– 100+ redundancies: at least 90

days before first dismissal (to be

reduced to 45 days in April 2013)

– 20-99 redundancies: at least 30

days before first dismissal

30


• What should good consultation look

like? (cont’d)

– Stage 1: provide written information

to representatives

– Stage 2: consult with "a view to

reaching agreement"

– Don't forget individual consultation

31


• What penalties exist for a failure to

consult?

– Maximum protective award of up to

90 days' gross pay per dismissed

employee

– Amount of award based on

seriousness of employer's breach

– Special circumstances defence 32

Workforce Reductions – Netherlands

• The Collective Redundancy

Notification Act (WMCO) if employer:

– Proposes to dimiss 20+ employees

– For economic reasons

– Within a period of three months

– At one establishment

• WMCO has been amended as of

March 2012 33

Workforce Reductions – Netherlands

• Employer must notify trade unions

involved, Works Council and Social

Security Board (UWV WERKbedrijf)

• Employer must consult with trade unions

• After notification in general one-month

waiting period applies before contract can

be terminated

• If employer does not comply employee

can annul termination within six months

34

Workforce Reductions – Germany

• Mass redundancies depending on

threshold, § 17 KSchG (Dismissal

Protection Act)

• Co-determination for Works Council, §§

111, 112 BetrVG (Works Constitution Act)

• Settlement of interest

(Interessenausgleich)

• Social Plan (Sozialplan): takes two to four

months

35

Workforce Reductions – Germany

• How to calculate severance payments:

0.5 to 1.5 or more gross monthly salary

per year of seniority

• Dismissal protection act: to show that

reason to terminate exists and social

election

• Crucial: quick negotiations and well

prepared timetable

• Avoid: Union strike against intended work

force reduction 36

Workforce Reductions – France

• For large collective dismissals (10+

employees within 30 days), companies

with 50+ employees have to set up

mandatory social measures (Plan de

sauvegarde de l’emploi); aim is to favor

firstly internal redeployment in the

company and the group it belongs to.

• The sanction for lack of consistency of the

PSE is very strict: nullity of the PSE makes

dismissals null and void.

37


• The procedure is regulated by several

delays fixed by law, but they appear to be

more theoretical than practice.

• The delay in the minimum number of two-

round consultations of the Works Council

varies according to number of dismissals:

– 14 days between the first and the second

consultation for 10-100 dismissals

– 21 days for 100-250 dismissals

– 28 days for 250+ dismissals

38


• Representatives always try to lengthen the procedure:

- They can ask for a certified accounting

- If the law already gives some guidelines

for the PSE content, the employer has to

answer every representative’s questions.

- They can negotiate on the delays

• In some instances, employers tend to

settle with a Voluntary Redundancies

Plan (Plan de Départs Volontaires).

39

Workforce Reductions – Poland

• Termination notice:

– In writing

– With due advance

– Providing for justified reason for

termination

– Consultation with trade unions,

employee council

– Protected groups of employees

40


• Massive layoffs:

– Severance pay due

• The economic situation often forces

employers to change the

employment relationship to that of

independent contractors, which

allows minimizing the social

insurance contributions.

41


• This may be deemed ineffective,

unless the former employee

becomes actually independent from

the employer in regard to the

manner and time of work

performance, as well as the liability

for results of his/her work.

42

Workforce Reductions – Italy

• Employers staffed with more than 15

employees

• Redundancies (at least five over 120

days)

• Information and consultation

procedure: purposes and timing

• Selection criteria

43


• Finding an agreement with the

employees’ representatives is not

necessary to proceed with the lay-

offs but advisable: the “making-up”

effect.

44


• What if …

– Oral dismissal

– Violation of information and

consultation procedure

– Violation of selection criteria

45

Balancing Work and Family

Commitments

46

Work-Family Balance – Italy

• Definition: attention to the individual

and his/her well-being both in the

work and private context

• Aim: to provide men and women the

means to achieve personal and

professional realization, which

impacts positively on individuals,

families, employers and, in general,

society

47


• Work time policies – flexibility –

teleworking

• Equal opportunities

• Career development

• Talent retention

• Absenteeism reduction

• Well-being at workplace

48


• Italian statutory provisions

• Best practices of European

businesses

49

Work-Family Balance – UK

• Current system

– Maternity leave

– Paternity leave

– Adoption leave

– Parental leave

– Emergency time off

– Ante-natal appointments

– Flexible working – parents/caregivers

50

Work-Family Balance – UK

• New proposals

– Flexible parental leave (2015)

– Better adoption rights (2015)

– Surrogacy rights (2015)

– Parental leave (extended 2013 and

2015)

– Ante-natal appointments (2015)

– Flexible working - all workers (2014) 51

Work-Family Balance – Netherlands

• Statutory maternity leave

• Statutory right to reduce or increase

working hours

• Protection from dismissal

• Parental leave

• Adoption leave

• Short-term and long-term care leave

52

Work-Family Balance – Germany

• Art. 3 GG (German Constitution)

– Gender equality; state must foster the

equal treatment

• § 1 AGG (General Equal Treatment

Act)

– Based on directive 2006/54/EC for the

realisation of equal treatment of men

and women regarding work, working

conditions, apprenticeships, etc.

53


• §§ 1, 8, 11, 385 SGB III (Social

Security Code)

– Gender equality; compatibility of work

and family; encouragement by public

agencies

• Bundeselterngeld-/ Elternzeitgesetz

(Parental Leave Act - BEEG)

– Special arrangements in companies for

parenting

54


• Bundeselterngeld-/ Elternzeitgesetz

(Parental Leave Act - BEEG) (cont‘d)

– Parents´ salary: approx. 67% of the

annual gross salary (§ 2 BEEG) for a

minimum of two months and maximum

of 12 months (§ 4 BEEG)

– Parental leave time until the end of the

child’s third year; flexible working hours

up to 30h/week (§15 BEEG)

55


• Pflegezeitgesetz (Care Time Act -

PflegeZG)

– Employees might stay a certain time at

home to take care of family members

in need of care (approximately 10 days

off (§ 2 PflegeZG)), if the special need

is just temporary; at the most 6 months

(§ 4 PflegeZG)

56


• Pflegezeitgesetz (Care Time Act -

PflegeZG) (cont‘d)

– Option to work part-time (§ 3

PflegeZG)

– Special dismissal protection for that

time (§ 5 PflegeZG)

57

Work-Family Balance – France

• The concern about balancing work and

family commitments is linked to the

employer’s responsibility to maintain

employees’ health (mental and physical).

• Since 2002, with the “asbestos” cases, the

jurisprudence has introduced a strict

obligation for the employer to ensure

security results.

58

Work-Family Balance – France

• This concern about employees’ health was

created at the beginning of the 2000’s; the

result is a new approach to working time.

• Compulsory collective bargaining on

gender equality has to end up with a

collective agreement, or at least an action

plan on balancing between work and

family commitments (working conditions,

part-time work, leaves, etc.)

59

Work-Family Balance – Poland

• Gradually extending the maternity and

paternity leave; as of 2013 the

employee may be entitled to one year

such leave.

• Growing protection of pregnant women

or parents, who take advantage of

various types of parental allowances,

against employment termination.

60

Work-Family Balance – Poland

• Little, yet growing, popularity of

flexible employment systems, such

as telework, flexible hours etc.

• Mixture of a part-time employment

and partial childcare leave.

• Employment during the parental

leave.

61

Regulating Age

Discrimination

62

Age Discrimination – Netherlands

Sources and Legislation

• International Treaties and conventions

(e.g. UN Covenant, EU Treaty)

• EU Directive 2000/78/EG

63


Sources and Legislation (cont’d)

• National Acts:

– Dutch Constitution

– Dutch Civil Code

– Equal Treatment Act

– Equal Treatment based on Age in

Employment Act

• Judgments of the Court of Justice EU

and national courts/commissions

64


Ethos

• Discrimination on the grounds of age

related to employment is prohibited

unless objectively justified, e.g.,

– Governmental labour market/employment-

related policies promoting the participation

of elderly or younger employees

– Statutory age limits

– Minimum conditions re: vocational training

and job starting

65


Scope

• Applies to all phases of employment:

– Job advertisements

– Recruitment

– Employment conditions

– Promotion

– Dismissal

66


Bringing Discrimination Claims

• An employee who feels discriminated by

the employer can bring a claim to:

– Human Right Authority (opinion is not

binding)

– Court

– Both HRA and Court

• A dismissal violating age discrimination is

null and void, provided employee invokes

nullity within two months after termination

67


• Examples

– Regulations regarding mandatory (early)

retirement ages (e.g., pilots)

– Seniority regulations (e.g., right to extra

holidays or reduction of working hours at a

certain age)

– Regulations to enter into (several

consecutive) fixed-term contracts until or

after a certain age

– Granting rights regarding length of service

68


• Guidelines

– The purpose of a regulation must serve a

general interest

– It must serve a social policy aspect and

not just the specific needs of an employer

– A regulation must be appropriate and

necessary to reach the goal

– If the goal can be reached in another non-

discriminatory way, the regulation is not

objectively justified

69

Age Discrimination – Germany

• General Equal Treatment Act

(Allgemeines

Gleichbehandlungsgesetz - AGG)

• Discrimination concerning the age is

forbidden within this legal framework

• Protection of every age group

70


• Recently it has gained in importance:

– Job advertisement: “looking for a young

team” is age discrimination and illegal

under the General Equal Treatment

Act; (Federal Labor Court 2010-08-19,

8 AZR 530/09)

71


– Forming a scheme for severance

payments using age-groups (§10 Para

3, No.6 AGG) is compatible with the

General Equal Treatment Act (Federal

Labor Court 2011-04-12, 1 AZR

764/09); employees up to age 29 years

get a factor of 80%, up to 39 years

90% and 40 years onwards 100% of

severance payment

72

Age Discrimination – France

• The employer cannot take into account only

the age in making a decision, as it would be

discriminatory and imply a nullity of the

dismissal and unenforceability of the

agreement.

• Nevertheless, age differential treatment is

allowed if two cumulative conditions, strictly

appreciated, are respected:

- Justified by a legitimate aim (maintain older

or/and younger workers in employment)

- Strictly necessary to the aim (proportionality).

73

Age Discrimination – France

• For example, differential treatment

according to age is possible for additional

compensation in collective dismissals

because employees are not in the same

situation:

– Older employees have more rights due to

their age than younger employees

– Public financial assistance will be different

according to age: the olders will be able to

have a full retirement pension 74

Age Discrimination – Poland

• It is unlawful to differentiate the legal

status of an employee solely on the

grounds of his/her age, unless

compliant with other provisions of law

(e.g., certain posts may be taken only

by persons of a given age) or

objectively justified by the kind or

conditions of work.

75

Age Discrimination – Poland

• Acquisition of entitlement to retirement

pension may not constitute a sole

reason for termination of the

employment relationship.

76

Age Discrimination – Italy

• Any agreement or action aimed at

discriminating an employee based on

age is null and void.

• Such discrimination may concern:

employment, termination, individual

transfer, assignment of tasks and

duties, and disciplinary procedures, as

well as any other action causing

prejudice to the employee

77

Age Discrimination – Italy

• Case law precedents:

– Proximity to pension age

– Employment of minors: salary and

automatic pay increase

78

Age Discrimination – UK

• Equity Act 2010

– Direct age discrimination

– Indirect age discrimination

– Harassment

– Victimisation

– Exceptions

79

Age Discrimination – UK

• Retirement Dismissals

– Default retirement age rules

repealed on 6 April 2011

– Must be “objectively justified”

Legitimate aim

Proportionate

80

Transfer of Undertakings

Protection of Employment

(TUPE)

81

Transfer of Undertakings – France

• Understanding the framework of

TUPE in three steps

• TUPE or dismissals: from a

protective rule to a controversial use

• Key points regarding the collective

status

82


Understanding the framework of

TUPE in three steps

• What’s the aim of the TUPE legislation?

• When TUPE applies, the buyer has to

maintain all the employment contracts

• From a European and French law

perspective, there are three main steps

an employer needs to identify to

determine if TUPE applies or not.

83


• Step 1: determine if seller’s activity

constitutes what the French and

European judges refer to as: autonomous

economic entity

• Step 2: determine if the main

characteristics of the autonomous entity

exist

• Step 3: determine if the identity of the

autonomous economic entity is

preserved.

84


TUPE and dismissals: from a

protective rule to a controversial use

• French/European paradox

• Two kinds of risks

– Before the transfer

– During or after the transfer

• TUPE remains a protection against

dismissal for only 24 hours

85


Key points regarding the collective

status

• After the application of TUPE, there is

an automatic “termination” of collective

bargaining agreements, but actually

during a fixed-time period, they survive

unless and until a new one is

concluded.

86


• There are two main reasons for the

buyer to harmonize the collective

status

– Avoid individual advantages

(“avantages individuels acquis”)

– Avoid two employees, with the same

job, having different advantages

because of a former collective status

87

Transfer of Undertakings – Poland

• All existing individual employment

contracts remain valid and binding.

• The transfer of undertaking may not

be the sole reason for termination of

an individual employment contract.

88

Transfer of Undertakings – Poland

• Obligation to notify the trade unions

or employee representative in

advance. However, these bodies

have no power to oppose the

transfer.

• The provisions of a collective labour

agreement remain applicable for

one year from the date of transfer.

89

Transfer of Undertaking – Italy

• The employment relationship

continues with the transferee and

the employee maintains the

entitlements deriving from it

90

Transfer of Undertakings – Italy

• Joint responsibility for the claims the

employee had at transfer date

• Application of collective agreements

• The transfer of undertaking cannot

ground termination

• Substantial modification of work

conditions

91

Transfer of Undertakings – Italy

• For employers staffed with more

than 15 employees:

– Information and consultation

procedure

– Business crisis and agreement with

unions: is it possible to bypass

TUPE rules?

92

Transfer of Undertakings – UK

• TUPE 2006- current system

– When does TUPE apply?

Standard business transfers

Service provision changes (SPC)

– Key protections

93

Transfer of Undertakings – UK

• Proposals for reform

– Government consultation on reform

(closes 11 April 2013)

– Key proposal: repeal of SPC rules

– Key proposal: extend scope for making

fair dismissals and changing terms

– Changes into force in October 2013

94

Transfer of Undertakings – Netherlands

• Art 7:662 to 666 of the Dutch Civil

Code apply to transfer of undertakings

• Transfer must be a relevant transfer

• Obligation to inform and consult Works

Council in advance

• Consultation Trade Unions only in case

of a merger and transfer of > 50

employees

95

Transfer of Undertakings – Netherlands

• All employment conditions (including

those in collective agreement) transfer

• Joint and severally responsibility for

claims employees during one year

• Transfer cannot be a valid reason for

dismissal (except if ETO reasons are in

place)

• If employee objects to transfer,

employment contract ends automatically

96

Transfer of Undertakings – Germany

• § 613 a BGB (German Civil Code)

– If a company is transferred to a

purchaser, all employees of that

company are also transferred to the

purchaser together with all their

employment-related rights

– The same is true for a merger, property

transfer, splitting, etc.

97

Transfer of Undertakings – Germany

• European TUPE directive (77/187/EC and

2001/23/EC) implemented into law

• Transferred employees have a statutory

right to object to their transfer to the new

company within a month after having

received an information letter regarding

their transfer

– Consequence: employees who rejected

the transfer remain employed with their

former employer (seller)

98

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New Developments in European Labour and Employment Law ... · New Developments in European Labour...

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Transcript of New Developments in European Labour and Employment Law ... · New Developments in European Labour...