In its ruling of September 24, 2019, the Federal Labour Court (BAG) dealt with the requirements for the effectiveness of preclusion period regulations in socalled old contracts which were concluded before the Act to Modernize the Law of Obligations came into force on January 1, 2002.
The parties disputed the payment of Christmas and holiday bonuses. The employer refused the payment, citing the preclusion period in the employment contract. The clause in dispute was worded as follows: “The parties agree that all mutual claims arising from the employment relationship shall expire within three months of the due date. Such forfeiture shall not occur if such claims are asserted in writing to the other party within this period.
In the opinion of the BAG, the preclusion period under the employment agreement is effective. It is true that Sec. 202 Para 1 BGB, in the version in force since January 1, 2002, prohibits the exclusion of liability for intentional breach of contractual obligations or tort by contractual preclusion periods; this also applies to preclusion periods in employment contracts that were agreed before January 1, 2002. However, a preclusive period provision which refers without restriction to “all mutual claims arising from the employment relationship” was exceptionally to be interpreted by way of a supplementary interpretation of the contract to the effect that its scope of application does not cover liability claims within the meaning of Sec. 202 Para. 1 BGB and Sec. 309 No. 7 BGB (inadmissibility of the exclusion or limitation of liability for damages arising from negligent or intentional injury to life, body or health as well as liability for other damages based on grossly negligent or intentional breach of duty). This is because these legal regulations did not yet exist when the employment contract was concluded and could therefore not be taken into account in the draft regulation on preclusive periods. However, it could be assumed that the parties wanted to agree the clause in principle in conformity with the law. Similarly, Sec. 3 Sentence 1 MiLoG (Minimum Wage Act), which came into force on August 16, 2014 and stipulates that the entitlement to the statutory minimum wage may not be excluded, does not lead to an overall invalidity of the preclusive period clause.
The practical relevance of the BAG ruling is essentially limited to old contracts concluded before January 1, 2002. All employment contracts concluded after this date must be based on the provisions of Sec. 202 Para. 1 and Sec. 309 No. 7 BGB in order to be legally effective. It is gratifying that the BAG has clarified that a violation of Sec. 3 Sentence 1 MiLoG in employment contracts concluded before August 16, 2014 only leads to a partial invalidity of the preclusion period provision with regard to the claim to the statutory minimum wage. Otherwise it remains effective. It should be noted, however, that a contractual amendment made after the relevant cutoff dates may, under certain circumstances, result in a “new contract” rather than an “old contract”, which must be measured against the legal provisions applicable at the time of its conclusion.
Federal Labour Court: Works council claim under the German Act on the Transparency of Remuneration with regard to gross pay lists
The German Act on the Transparency of Remuneration (EntgTranspG) obliges the employer to involve the works council in the individual procedure to review equal pay. The decisive obligation is to respond to requests for information from employees. In principle, the law allows a works committee formed by the works council to inspect and evaluate the employer’s gross remuneration lists. However, if the employer has justifiably taken the fulfilment of the obligation to provide information upon itself, the works council has neither a right to inspect nor a right to evaluate.
The employer makes use of the possibility provided for in the Act on the Transparency of Remuneration to generally assume the obligation to fulfil employees’ requests for information. The employer informed the works council of the employees’ requests for information and granted it access to the gross pay lists prepared for this purpose. These lists were broken down by gender and included all remuneration components. With reference to Sec. 13 Para. 2 Sentence 1 EntgTranspG, the works council also demanded to receive the lists in certain electronic file formats for evaluation.
In a decision dated July 28, 2020 (1 ABR 6/19), the BAG decided that the right of inspection and evaluation pursuant to Sec. 13 Para. 2 Sentence 1 EntgTranspG only applies to the works council if the employer does not respond to the employees’ individual requests for information itself. However, if the employer has taken this legal obligation upon itself, the works council has no right to inspect or evaluate the gross pay lists.
The Pay Transparency Act basically provides for two ways in which employees’ requests for information can be answered, one by the works council and the other by the employer. If the employer has decided to take the responsibility for answering individual requests, the works council’s involvement is reduced to a right to information.
LAG Schleswig-Holstein: No claims for repayment of fees by the employer against alleged freelancer after status determination
In principle, the employer cannot demand repayment of the fees paid to a alleged freelancer if the legal relationship subsequently turns out to be an employment relationship. This request is regularly opposed by the protection of the employee’s confidence.
The defendant worked for a total of six months in the calendar year 2015 as a certified nurse for the plaintiff, who operates a care and therapy center. The activity was based on a service contract. In order to perform the required activities, the defendant was assigned to the plaintiff’s duty rosters by agreement; he was granted the right to refuse shifts. When carrying out his activities, he wore his own clothing of a different colour from the working clothes of the employees and billed his work monthly on the basis of the hours worked at hourly rates of between EUR 30.00 and EUR 34.00.
In 2016, a company pension review was carried out by the German Pension Insurance (DRV). The latter classified the legal relationship between the parties as dependent employment and subsequently demanded considerable social security contributions from the plaintiff. The defendant was neither involved in these proceedings nor was any payment credited to its pension account.
The plaintiff demanded that the defendant reimburse the fees paid in the amount of approximately EUR 10,000, arguing that the defendant had actually been an employee due to his integration into the plaintiff’s work processes, but in this case could have earned only EUR 16.32 gross per hour according to the TVöD.
The Schleswig-Holstein State Labour Court rejected the claim for repayment in a ruling of January 16, 2020 (5 Sa 118/19) on the grounds of trust. The parties assumed an employment relationship when concluding the contract and lived the contractual relationship accordingly, in particular with regard to the plaintiff’s occupational health and safety obligations. In particular, the plaintiff did not continue to pay remuneration in the event of illness and did not grant paid vacation. The subsequent adjustment of the remuneration to the TVöD applicable to an employment relationship was an abuse of law. The defendant neither requested nor was offered a permanent position by the plaintiff. The defendant had independently insured himself against loss of employment.
The use of external personnel regularly involves considerable dangers and risks. This is especially true if the person obliged to provide the service is integrated into the work processes. Misjudgements are regularly sanctioned by the German Pension Insurance with substantial additional claims for social security contributions, so that the use of external personnel is often no longer economically viable. The state is also responsible for prosecuting a criminal offence under Sec. 266a StGB (German Criminal Code) for withholding wages and social security contributions. A thorough prior examination of the use of external personnel is therefore urgently required.
ArbG Mainz: Obligation to provide classroom teaching
In its decision of June, 08, 2020 (4 Ga 10/20), the Mainz Labour Court rejected the application of a 62-year-old teacher for a temporary injunction prohibiting the use of teachers for the provision of face-to-face teaching. In his application against his employer, a vocational school with remedial teaching, the applicant invoked his age (born in 1957). He argued that by using attendance lessons during the Corona pandemic, he was exposed to unreasonable health risks, although there was no interest in providing attendance lessons.
The Labour Court confirmed the discretionary power of the schools to avert dangers during the Corona pandemic. In this respect, the applicant’s request for a temporary injunction is not subject to the decision of the courts. The school is responsible for the deployment of its teachers, and the court cannot therefore make an advance decision on which teacher can be deployed and how.
Moreover, a sufficient distance could be granted in the context of classroom teaching precisely because the applicant is to give individual lessons in a 25-square-metre room. The court was also not convinced by the applicant’s view that there was no interest in the granting of attendance lessons. The applicant’s task was to provide remedial teaching to disadvantaged pupils who could not easily access online lessons or other support.
Amendments to the Posted Workers Act
On July 30, 2020, a comprehensive amendment to the German Act on the Posting of Employees (AEntG) came into force.
The provisions of the AEntG now also apply to temporary workers posted to Germany. This does not apply to visits to trade fairs, conferences, meetings and further training courses lasting up to two weeks. Furthermore, the new regulations do not apply to initial assembly and installation work lasting up to eight days in the first year.
The list of minimum working conditions has been extended to include requirements for company housing, allowances for travel and accommodation costs, overtime and other allowances, and benefits in kind. In addition, all industries with generally binding collective bargaining agreements are now entitled to collectively agreed wages. The reimbursement of additional travel, accommodation and subsistence expenses may not be offset against wages. In the case of longerterm assignments, all working conditions applicable in Germany must be complied with after twelve months – at the latest after 18 months.
Gradual increase of the statutory minimum wage
The Minimum Wage Commission has decided to increase the minimum wage in four stages. The statutory gross wage will rise from EUR 9.35 to EUR 9.50 per hour on 01.01.2021, to EUR 9.60 on 01.07.2021, to EUR 9.82 on 01.01.2022 and to EUR 10.45 on 01.07.2022.
This corresponds to a very irregular increase between 0.11 % and 6.1 %.
The negotiated minimum wage increases are based on the average collective wage increases of the past two years and economic forecasts as well as the employment and competitive situation.
Law to improve enforcement in occupational safety (Occupational Safety and Health Control Act)
In its meeting of July 27, 2020, the Federal Cabinet launched the draft of the Occupational Health and Safety Control Act. The law is intended to create orderly and safe working conditions in the meat industry. In addition, it lays down nationwide uniform rules for the inspection of companies and for the accommodation of employees in other sectors as well.
The draft includes the following essential regulations:
- Prohibition of the use of external personnel in the core business of the meat industry (for contracts for work from January 1, 2021, for temporary work from April 4. 2021). The ban does not apply to companies in the butchery trade with up to 49 regularly working persons.
- Introduction of nationally binding control rates (from 2026: at least 5 % of the sites in the federal state) and the implementation of priority controls in risk sectors.
- Minimum standards apply to the accommodation of employees, for example with regard to the equipment of the accommodation. The employer must draw up documentation on the accommodation of workers in shared accommodation and keep it for four weeks after the end of the accommodation.
- Obligation for employers to inform the competent authorities of the place of residence and place of work of all workers.
- Obligation for digital time recording and electronic storage in the meat industry.
- Doubling of the fine from EUR 15,000 to EUR 30,000 for infringements such as the prohibition on the use of outside personnel.