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In this Blog we write about topics from the Workplace Law and HR world: We discuss important court decisions and planned legislations, give practical tips and share with you experiences from our daily working life…
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Your PWWL editorial team
Christine Wahlig
Attorney at law
Editorial Management
Alice Tanke
Marketing Manager
The Federal Labour Court (Bundesarbeitsgericht, BAG) ruled on 13 September 2022 (we reported on this earlier: “Obligation to record working hours in Germany!”) that the entire working time of employees must be recorded. This results from an interpretation of section 3 (2) no. 1 of the Occupational Health and Safety Act (ArbSchG) in conformity with EU law.
This decision had many names. “Drumbeat” or “sensation” are just a few of them. Regardless of the vocabulary, there was in any case agreement that there was a need for legislative action. In practice, the uncertainty was great: What do employers have to do and what not?
The legislator in the shape of the Federal Ministry of Labour and Social Affairs (BMAS) has heeded this call and published a draft bill to amend the Working Hours Act and other regulations on 18 April 2023. Hardly any draft bill has received as much media attention as this one.
In doing so, the BMAS made it its task to regulate the “how” and not the “whether” of recording working time in order to eliminate any uncertainties that may have arisen from the BAG’s decision.
The draft bill contains the following regulations in overview:
Employers are obliged to electronically record the beginning, end and duration of the daily working time of employees (as well as of juvenile employees) on the day of work performance. However, this requirement does not exclude the possibility of correcting or making up for a missed entry at a later date. A specific type of electronic recording is not prescribed. Electronic devices are possible, but also apps or – quite classically – Excel (or for those who prefer to use Apple: Numbers).
It is still possible to delegate the recording of working time to the employees themselves or to third parties. Third parties can be, for example, the supervisor. However, the employer remains responsible for proper recording. It is recommended to inform the employees in advance about the obligation to record and to check the records on a random basis.
The possibility of trust-based working time is not limited by the new regulation, but only extended by the obligation to record working time. Trust-based working time in this sense means that employees can largely decide for themselves when they work and when they do not. In doing so, their times must be recorded, but the employer does not have to control this (consistently). However, employers must ensure that they become aware of violations of the provisions of the Working Hours Act. This can be done, for example, by a corresponding notification of an electronic working time recording system.
Employees also have a right to information against the employer about the recorded working time. Employers must provide an (electronic) copy upon request. It is also sufficient for employees to be able to access the relevant electronic records themselves and make copies.
The works council may also inspect the working time records upon request in order to fulfil its obligations under section 80 (1) of the Works Constitution Act (BetrVG).
Companies must keep records of working time for at least two years.
Attention: This should also apply to trust-based working time, even if compliance with working time does not have to be consistently monitored.
Interesting for employers abroad: The records must be kept in German and kept and available in Germany in case of a control.
However, the legislator’s draft provides for far-reaching freedom for collective bargaining and company parties. They can agree that
The last point in particular opens up scope for design, for example, the exclusion of senior employees (who are not executive employees) with sovereignty over the determination of their working time from time recording. However, it is problematic here that a design by company agreement is only possible on the basis of a collective agreement opening clause. This means that all sectors and companies not covered by collective agreements are denied this possibility. We see a need for action here.
Many companies can breathe a sigh of relief by being granted very soft transition periods. These depend on the size of the company. In principle, all employers have one year until they must electronically record the working hours of their employees. Until then, manual records will also suffice. After that, the following graduation applies:
Employers with up to ten employees are completely exempt from the obligation to record working hours electronically. But beware: The obligation to record working time applies from the beginning, just not electronically.
A violation of the aforementioned regulations shall constitute an administrative offence punishable by a fine of up to EUR 30,000.00. This also applies to a violation of the employee’s right to information.
No. The new draft bill locates the obligation for electronic time recording – unsurprisingly – in the Working Hours Act and not in the Occupational Health and Safety Act. Therefore, executive employees are not covered by the obligation. However, the obligation applies regardless of the size of the company, i.e. also to small companies (with the exception of electronic recording).
The draft law leaves some questions unanswered and many would have liked to see more far-reaching regulations. One example is the scope of the recording obligation: Do employees take a break if they talk to their colleagues for five minutes in front of the coffee machine? Do breaks have to be recorded at all? Do working hours also have to be recorded if they send a short e-mail after work? Does the rest period of eleven hours have to be observed again from then on?
It is assumed by the BMAS that the costs for the technical introduction of electronic working time recording are 450 EUR per enterprise. The BMAS does not take into account the operating costs of a working time recording system, especially if this is to be carried out by a provider or software. Furthermore, considerable additional organizational and bureaucratic effort is to be expected. We assume that the costs will be significantly higher for companies that do not yet operate a working time recording system.
The draft bill of the BMAS does not contain any major surprises and essentially implements the requirements of the BAG and the European Court of Justice. At present, it is only a draft bill, so changes can be expected before the law is passed. What is certain, however, is that the electronic recording of working time will come and that violations of this can lead to heavy fines.
Currently, the first employers’ associations and other interest groups are already commenting on the draft: with mixed feedback. Many criticise, for example, that the recordings have to be made on a daily basis and fear that this will lead to a great deal of work. Others ask themselves why the draft has been limited to a minimum implementation of the case law and why topics such as the maximum weekly working time have not been addressed. In our article on the BAG decision (“Obligation to record working hours in Germany!”) we already pointed out that the European Working Time Directive, from which the obligation to record working time is derived, offers much more flexible options than the German Working Time Act with regard to the group of persons required to keep records, the maximum daily and weekly working time and the duration of rest periods. Unfortunately, the draft is limited to the implementation of the BAG ruling and misses the amendment of the Working Time Act as a whole, which is necessary in our view. It is to be hoped that these aspects will still be taken into account in the legislative process. It is also interesting that the legislator stuck to the written form (paper!) when amending the Verification Act last year and that electronic recording of working time is now obligatory. In labour law, the Stone Age seems to compete against the future every now and then.
Companies should already start thinking about how they can and want to implement (electronic) working time recording in the future, but they should not act hastily until the final law is in place. Nevertheless, precautions can already be taken now. Companies should, for example, define exactly what counts as working time and what does not. Before the introduction of working time recording, employees should be trained on how to record working time and which times are to be recorded at all.
It is important to emphasise that the working time to be recorded under the Working Hours Act does not automatically have to be remunerated. This continues to be governed by the legal, collective bargaining and contractual regulations. Nevertheless, we expect that the obligation to record and the corresponding right to information of employees will significantly improve their legal position in the overtime remuneration process in the future. From our point of view, it is positive that individual company regulations remain possible and that, in this way, significantly longer recording periods can be agreed. The question of when a group of employees can be exempted from the regulations of the Working Hours Act because their activities fulfil “special characteristics” will probably be discussed a lot.
We will continue to inform you about the most important developments!
