On April 1 2017, the reform of the German Act on Temporary Agency Work (Arbeitnehmerüberlassungsgesetz) came into force bringing major changes for agencies and their clients. Agencies and their customers have to revisit work processes and agreements. The same is true for the use of external staff based on service or work contracts (e.g., facility management, IT services) The time to act is now, since not all changes are subject to transition periods. In fact, material changes already came into force on April 1,2017, the violation of which may result in severe sanctions up to criminal penalties.
The German Federal Labor Court (Bundesarbeitsgericht – BAG) has ruled that when an employer provides Facebook users access to publish posts on the company’s Facebook page that relate to the behavior or performance of individual employees, that process is subject to negotiation and co-determination of the works council.
The ruling is of particular significance especially for companies with an existing works council in Germany that operate a Facebook page or a page on a similar social network with a commenting function for users.
Just in time for the 10th anniversary of the German General Equal Treatment Act (Allgemeines Gleichbehandlungsgesetz – AGG) the European Court of Justice (ECJ) has clarified that European anti-discrimination law does not protect mock applicants, i.e. applicants who are not interested in being hired, but solely apply in order to bring claims on the grounds of discrimination. The judgment will make it easier for companies in Europe to reject such discrimination claims in the future.
Last week, Germany’s Financial Supervisory Authority (BaFin) unveiled a centralized platform for receiving whistleblower complaints, including anonymous complaints, of alleged violations of supervisory provisions within the financial sector. The move appears to represent a shift in German ideology toward a more favorable view of anonymous reporting, which for many years was discouraged in Germany and more broadly in the EU due to the risk of “organized systems of denouncement.” Under the new program, whistleblowers may submit reports in writing (on paper or electronically), by phone (with or without recording the conversation), or verbally. BaFin’s press release announcing the program states that it will make the anonymity of whistleblowers a “top priority,” and that it will not pass on the identity of whistleblowers to third parties. The program is “aimed at person with a special knowledge of a company’s internal affairs – for example because they are employed there or have some other contractual relationship or relationship of trust with the company.”
BaFin was required to implement this new platform due to an amendment to the German Act on Financial Services Supervision. Notably, the Act only applies to the financial services sector, not including external accountants, tax consultants and attorneys. It provides that employees working in the financial services sector may not be held liable for reporting potential or actual breaches of law under either employment law or criminal law, unless the report was false or grossly negligent.
On June 1, 2016, the draft law regarding the reform of the German Act on the Supply of Temporary Employees (Arbeitnehmerüberlassungsgesetz – AÜG) has been adopted by the Federal Cabinet. The German Bundestag will address the draft law after the summer break. However, material changes to the draft are not expected to be made during the parliamentary process. If the time schedule will be observed, the reform will come into force as planned on January 1, 2017.
The new law will bring material changes for both, employment agencies and their customers, the host businesses.
Draft legislation regarding the reform of the German Act on the Supply of Temporary Employees (Arbeitnehmerüberlassungsgesetz – AÜG) has been introduced by Germany’s Federal Minister of Labor. Although further amendments to this draft are likely and a final version will not come into force before January 1, 2017, it is important to know what this means for temporary employment agencies and their customers, the host businesses.
Statistics reveal a difference of 7 percent between the remuneration paid to men and that paid to women with the same qualifications in Germany. The average hourly wage even shows a difference of 22 percent, making pay discrepancy in Germany one of the highest in the EU. In order to adjust these wage injustices, the German Federal Ministry for Family Affairs, Senior Citizens, Women and Youth submitted a first preliminary ministerial draft of the German Equal Pay Act (Entgeltgleichheitsgesetz) on December 9, 2015. The act is expected to be adopted in 2016.
Powerful trade unions often are a thorn in the side of employers. But if a company tries to reduce the trade unions’ influence, it may violate the freedom of association under Article 9 section 3 of the German Constitution (Grundgesetz – GG). This was made clear in a recent ruling of the Labor Court (Arbeitsgericht) Gelsenkirchen (judgment of March 9, 2016 – 3 GA 3/16).
In certain circumstances an employer is entitled to analyse the browsing history of the work computer used by the employee without a need for the employee’s consent. This was made clear in a recent ruling of the Regional Labour Court (Landesarbeitsgericht – LAG) of Berlin-Brandenburg (judgment of January, 14 2016 – 5 Sa 657/15).
Asia Employment Law Update
Proposed Regulations May Complicate Reductions in Force in China
On December 31st, 2014, Ministry of Human Resources and Social Security (“MOHRSS”) issued a notice to solicit public opinions on the draft Regulations on Personnel Cutbacks by Enterprises (“Draft Regulations”). The Draft Regulations set out detailed implementing rules for “mass layoffs” (defined under the Labor Contract Law as being a layoff of more than 10% of the workforce or more than 20 employees) and, if adopted in their current form, will further complicate the process for conducting reductions in force in China.