On 14 May 2019, the Court of Justice of the European Union (CJEU) rendered a judgment requiring all Member States to require employers to setup and maintain a system for recording their employees’ working hours. What is this obligation based on and what are its consequences for employers in the Netherlands?
Question from a national court
The judgment was prompted by a national dispute between Spanish trade union CCOO and Deutsche Bank. In a class action before the Spanish courts, the trade union demanded that Deutsche Bank be required to introduce a system to record staff working hours, to enable verification of Deutsche Bank’s compliance with the stipulated working times and its observance of its national obligation to send overtime information to the employee representative bodies on a monthly basis. At the time, Deutsche Bank had a system that could only record full-day absenteeism rather than the number of hours and overtime hours worked by each employee.
When the case was brought before the Spanish court it was referred to the CJEU for a preliminary ruling. The purpose of the questions asked was to determine whether Spanish legislation, which did not provide for such a mandatory registration system, was contrary to European law.
The CJEU emphasises that the Charter of Fundamental Rights of the European Union gives workers a fundamental right to enjoy daily rest periods and maximum weekly working hours. This obligation was developed further in the Working Time Directive and the Occupational Safety Framework Directive. The Member States must incorporate the provisions of these directives into their national law to ensure that this fundamental right is safeguarded for their workers.
Without an objective and reliable record of the number of hours worked per day and per week, it is impossible to check whether the rules on working hours are being observed and extremely difficult, if not impossible, for workers to enforce their rights. An obligation to record only overtime, or giving employees the option to prove their working hours later, by providing evidence thereof, is insufficient in this context. Without a registration system, even an inspectorate cannot exercise proper supervision.
The CJEU holds that, therefore, Member States must require employers to set up an objective, reliable and accessible system enabling the duration of time worked each day by each worker to be measured. It is for the Member States to define the specific arrangements for implementing such a system, in particular the form that it must take, having regard, as necessary, to the particular characteristics of each sector of activity concerned, or the specific characteristics of certain undertakings concerning, inter alia, their size The national legislature has some discretion in this, however.
Finally, the CJEU points out that the Member States’ obligation to take measures to comply with European obligations applies not only to the public authorities in the Member States but also, to a certain extent, to the courts. This means that national established case law that is contrary to the objectives of European legislation must be amended.
In the Netherlands, the Working Hours Act (Arbeidstijdenwet) requires employers to keep proper records of work and rest periods. The purpose of this is to facilitate supervision of compliance with the Working Hours Act and the regulations based on it. This obligation means that, in any case, the times of starting and finishing the work and the breaks in between must be recorded. Hours equivalent to working hours, such as hours of sick leave and holidays, must also be recorded. As special rules apply to specific categories of persons, the identity of the employee must also be indicated. In some sectors, such as road transport, further regulations apply. Violation of this obligation may result in a fine of up to EUR 10,000 per employee, possibly to be increased in the event of repeated non-compliance. Finally, the registration requirements and the substantive rules concerning working hours do not apply to employees who earn at least three times the minimum wage.
The question is whether this means that the Dutch legislature is fully compliant with the CJEU’s instructions to define specific arrangements for implementing the system. After all, apart from the requirement to keep proper records of working hours, the standards to be satisfied by such a system have not been specified in general. Under the Dutch Working Hours Act, how employers record working hours is, in principle, for them to decide; further regulations only apply in specific sectors, such as road transport and mining.
All Member States will have to comply with the Court’s judgment and verify that their legislation complies with the guidance provided by the Court. In Member States whose employers are not yet subject to a registration obligation, the legislation will have to be amended. The courts in those Member States will have to find a solution, in line with the European rules to the greatest possible extent, for any disputes that may arise in this context, until the amendments have been made.
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