Recently, the European Court of Justice ruled that employers have a legal obligation to set up an accessible, reliable, and objective system to track the daily working hours of employees.

But what does this ruling mean in practice for employers in Germany in connection with the recording of time and attendance?

In its ruling of 14 May 2019, the European Court of Justice (ECJ) obliged member states to create regulations for the introduction of a comprehensive time recording system. Such a system is necessary for the objective and reliable determination of working time. The legally prescribed recording of overtime in Germany is not sufficient for this purpose. The ruling has not yet been implemented by the German legislature. The handling of the ruling by the national courts is evidence of an unclear legal situation, although this is the first time that a ruling by a regional labor court has addressed the issue.

The Effects Of The Decision Of The European Court Of Justice

The effects of the decision of the European Court of Justice

The ruling, which was made by the European Court of Justice, is addressed to all European member states of the EU and requires them to introduce corresponding national laws.

Thus, the ECJ ruling does not directly oblige companies to record the daily working hours of their employees. In addition, even before the ruling, there were numerous obligations that affected the recording of working hours. For example, companies must record all working hours that exceed the normal working day of eight hours. In addition, in the minimum wage sector and in the professional driver sector, there is an obligation to document both the beginning and the end of working hours.

If these regulations of the Working Hours Act are violated – for example, if the working hours are not recorded accordingly – this constitutes an administrative offense that can result in fines of up to 15,000 euros. In addition, the authorities also have the option of confiscating the economic benefit that has come to light as a result of the violation of the Working Hours Act. In addition, the authorities may order the companies concerned to document the beginning and end of daily working hours in the future.

Recording working time: time recording from the 0th hour onwards

Until now, employers were only obliged by law to record working hours that exceeded eight hours per day. Now, this gap must be closed and time recording must take place from the 0th hour.

The expert opinion also provides assessments and recommendations on the question of how time recording must be designed in detail – here it is primarily a question of the data to be recorded and the quality requirements for time recording systems; after all, according to the Court’s requirements, these must be reliable, objective and easily accessible.

Controversial Discussions About Implementation Of The ECJ Ruling

Controversial discussions about implementation of the ECJ ruling

Both in the legal field and in politics, the ruling of the European Court of Justice has triggered a controversial debate about whether it obliges German lawmakers to incorporate the decision into German law.

Even if there were an obligation to implement the ruling, German lawmakers still have a great deal of leeway in deciding the detailed arrangements for recording working time. The requirement of the European Court of Justice is that a reliable, accessible, and objective working time recording system must be made available. Thus, it is not specified whether this must be a traditional time clock or an innovative, digital system.

In addition, the ECJ ruling provides leeway in the area of companies whose number of employees is below a certain limit. Certain groups of employees can also be exempted from the recording of working time if the beginning and end of the daily working time are not predictable, such as in the case of doctors or persons who are responsible for determining their own working time.

No Direct Effect Of The ECJ Ruling

The most recent ruling of the Emden Labor Court was amended in the appeal before the Lower Saxony Regional Labor Court. With this decision, the Court of Appeal followed the voices from the literature which emphasized that the ECJ’s ruling had no direct influence on the national legal situation, in particular not on the regulations for the burden of presentation and proof in an overtime lawsuit. It was clarified that the European Union had no competence to decide on questions of remuneration, which is precisely what is at stake in overtime litigation. The judgment on the recording of working time had only been handed down with regard to the protection of workers’ health. In addition, a direct effect of the ruling on the national legal situation would undermine the national legislators’ scope for implementation.

Remuneration For Recorded Working Time

Remuneration for recorded working time

However, companies should not be deterred by the still unclear future prospects regarding the recording of working hours in Germany from already taking a close look at the issue of working time models. Although the ruling relates to public employment law, it did not address the question of whether recorded working hours must necessarily be remunerated.

For companies, the answer to this question naturally has a very high economic significance. After all, the remuneration of working hours is regulated by the collective agreement or employment contract. How these are structured in detail is now of the utmost importance as a result of the ECJ ruling.

This question was already dealt with by the Federal Labor Court in 2015. At that time, it was decided that the working time that was recorded by the working time recording system always constitutes compensable working time.  For this reason, it will be very important for companies in the future to take this into account in the time recording systems they use, for example by making a strict distinction between overtime and flexitime accounts.

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