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Advocate-General’s opinion may have significant implications for holiday law in Germany

June 1, 2018

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Under German law, employees generally apply for holiday during the holiday year so that their claims can be fulfilled. If they fail to do so, their entitlement lapses at the end of the year. When employees leave their firms, they cannot claim compensation for unused holiday. A recent Advocate-General’s opinion has now thrown doubt on this practice.

This area has been under scrutiny, as several Regional Labour Courts have granted employee claims for compensation in the form of a substitute holiday (or compensation) specifically in cases where the employee has not applied for holiday during the year. Up to now, the question of whether the employee is also entitled to compensation after failing to submit the appropriate holiday request was unresolved because the German Federal Holiday Act does not contain a corresponding provision.

Two cases on this issue presented by the Federal Labour Court and by the Higher Administrative Court of Berlin-Brandenburg (Case Nos.: C-619/16 and C-684/16) are currently being considered by the European Court of Justice (ECJ). In one, an employee sued a former employer for damages for untaken holiday although the employee had not applied for leave during the relevant calendar year. The claim was upheld by the Regional Labour Court. However, on appeal the German Federal Labour Court had its doubts and asked the ECJ to consider whether a holiday request is required before an employee is entitled to be compensated for untaken holiday at the end of the period under consideration.

Advocate-General Yves Bot presented his

GDPR HR Series: Subject Access Requests Under the New Regime – What You Need to Know

Welcome to the 2nd post in our ‘GDPR HR Issues’ blog series. Drawing on key insights from across Bryan Cave Leighton Paisner’s global Employment & Labor team, the series highlights key GDPR issues affecting employers.

With the General Data Protection Regulation (‘GDPR’) coming into effect today, employers with EU-based staff need to ensure that they properly comply with the new regime. Failure to do so can result in significant fines and disruption to your business.

This blog focuses on the changes made by GDPR to a fundamental data protection right – an employee’s right to find out what information their employer holds on them by making a data subject access request (‘DSAR’).

  • Complying with a DSAR can involve a lot of work and significant cost, not least because the request may require the employer to search in many different places for the employee information, which by its nature may not be held in a clearly structured way. For example, an employee could ask for details of email discussions that others in the organization have had about them over a long time period, which could require doing extensive searches of various email accounts. In some jurisdictions it is common for employees who are in dispute with their employer to use DSARs to obtain early disclosure of information that they can use in their dispute, or simply to put pressure on the employer. An employer cannot normally refuse to provide the information, unless an exception applies. A common exception in this context
  • Post-Contractual Non-Competes – a never ending story

    April 30, 2018

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    There are few clauses in employment contracts more heavily debated than Non-Competition Clauses (post-contractual non-competes). While employers tend to include them rather easily in order to protect company secrets beyond the term of an employment, strict and mandatory provisions under German law differ from those found in most other jurisdictions. For post-contractual non-competes to be enforceable, an entire catalogue of requirements must be met, including a mandatory compensation payment of at least 50% of the employee`s total earnings for the maximum term of two years – to name just the two most prominent requirements. Because of the potential financial impact on employers, it is highly advisable to carefully consider whether post-contractual non-competes are necessary at all and, if so, whether they will be enforceable.

    Two recent decisions in January 2018 by the Federal Labor Court/ BAG (10 AZR 392/179) and by the Appeals Court/ LAG Düsseldorf (Az: 7 Sa 185/17) are worth noting:

    “Vorvertrag” – Keeping your options open

    It is a common situation (and sometimes a true dilemma) for the employer to decide at the beginning of the employment relationship whether to agree on a post-contractual non-compete. While it is easy at that point to negotiate a non-compete, the employer might not be sure whether the circumstances and the unclear future developments justify the investment in a (potentially) costly non-compete. LAG Düsseldorf confirmed that it could be valid for an employer to agree on a post-contractual non-compete in the form of a preliminary contract (“Vorvertrag”) that grants the employer

    GDPR HR Series: Employee Information Notices About Personal Data – Your Key Questions Answered

    Following the combination of the Labor & Employment practices at Bryan Cave and BLP, Bryan Cave Leighton Paisner’s combined team now includes over 120 employment lawyers in offices across the US, UK, France, Germany and Russia, with excellent capabilities and a strong network in Asia. Committed to collaboration, and with our strengthened offering, experience and substantive knowledge advising clients on GDPR, we bring you our new ‘GDPR HR Issues’  blog series. Drawing on key insights from across our team, the series highlights the key GDPR issues affecting employers.

    The General Data Protection Regulation (‘GDPR’) comes into force in less than two months. From an HR perspective it imposes data obligations on any US, European or other employer with EU-based staff. Failure to comply with the GDPR regime can result in significant fines and disruption to your business. Are you ready?

    Our first blog deals with ‘privacy notices’ aimed at staff. GDPR requires employers to give information to their workforce, setting out in particular the personal data (employee information) the employer holds about them, how it is used, and with whom the information is shared.

  • We already give staff a privacy notice under existing data protection laws. Is that enough?
  • No. GDPR imposes new requirements on employers. Employers must give more detailed information than is currently required under existing EU data protection laws. Employers also need to ensure that their privacy notices accurately reflect their workforce data processing activities.

  • Our privacy notice is very long and complex. Is that a
  • Less than 90 days to go – are you GDPR compliant?

    “GDPR – please not again …” In recent times there is hardly any other legal topic more often written and talked about than the new EU General Data Protection Regulation (“GDPR”).

    In light of the severe penalties and with less than 100 days until the GDPR goes into full effect (on May 25th, 2018), it is time for U.S. companies to take steps to prepare. Below are some key points to consider and pragmatic to-dos to assist in assessing whether your organization is ready for GDPR compliance.

    • GDPR may apply to U.S.-based companies with zero employees and no offices within the boundaries of the EU territory

    While the EU Data Protection Directive of 1995 did not apply to businesses outside the EU territory, this is no longer the case under GDPR.

    Now any business may be subject to the new law if it processes personal data of an individual residing in the EU; not even a single transaction needs to occur. As long as your data processing relates to offering services or monitoring behavior on the EU market of EU data subjects – the GDPR may apply to your U.S.-based business. The location of a consumer is the key term to identify whether an individual is deemed a “data subject in the Unio.” While”location” does not necessarily relate to the consumer’s legal “citizenship” or “residenc,” lawyers often use the term “residency” as a short hand way of referring to those people to whom the direction of services might

    Works Council Elections in Germany – Avoid mistakes and be aware of special termination protections! Final Part III

    February 16, 2018

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    March 2018 is getting closer and works council (re)elections will again be on the agenda in Germany. We started this three-part blog last November with an overview to this topic and the second part highlighting the election proceedings. See link to November 7, 2017 blog and link to January 11, 2018 blog. In this final Part III, we briefly address the potential risks of reruns of elections due to mistakes and provide you with an overview of the special termination protection resulting from works council elections.

    Avoid mistakes – elections can be challenged or even be null and void!

    German employers are well advised to closely monitor the election proceedings. In the event of substantial breaches of the election process, the elections can be null and void, i.e., if such serious mistakes occurred that no democratic process was granted, or in less obvious breaches, elections can be challenged in court within two weeks of the announcement of the election results.

    Who can file the challenge – and what are the risks?

    The employer, three employees, or a union having members at the operational site are entitled to file a respective application with the competent local labor courts. If the court holds that the election process was breached, then the works council elections must be repeated.

    Court proceedings challenging the elections are time consuming and costly. Above all, they create uncertainty at the operational site. Questions may arise, for example, whether meanwhile concluded shop agreements are valid and binding.

    Serious changes for fixed-term employment in Germany announced

    The formation of a new government in Germany has not yet been completed however since February 7, 2018, the coalition agreement has been signed. Such political guidelines were consistently implemented during the last legislative periods.

    The changes affect fixed-term contracts which require no objective grounds for limitation. The maximum permissible duration of such fixed-term contracts will be reduced from 24 to 18 months. While previously a three-time extension of these contracts was allowed, this should now be possible only once within those 18 months.

    The permitted number of such fixed-term employment contracts will also be limited. Employers with more than 75 employees should only be allowed a maximum of 2.5 percent of the workforce for non-material fixed-term contracts. Exceeding the quota leads to the ineffectiveness of any further fixed-term employment contract, and to permanent employment contracts.

    Fixed-term contracts with objective grounds for limitation, in practice used if the employee has been previously employed or the maximum duration of fixed-term employment contracts as per above has expired, are also affected by the new regulations. If the employee previously had an indefinite, or one or more fixed-term employment contracts with a total duration of five years or more with the same employer, a renewed time limit is prohibited – even if there are recognized objective grounds for the limitation. An important point to note is: The maximum period of five years, also includes periods during which the employee was lent to the employer by other companies.

    The announced changes to the law

    Freer authors article on social networking and sexual harassment in the workplace

    January 22, 2018

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    London Partner Gary Freer, head of Bryan Cave’s UK Employment Team, authored an article featured Jan. 18 in Personnel Today examining the impact of digital technology, such as professional social networks, on sexual harassment in the workplace. “Even if a statement is made anonymously – under cover of a username – if it is likely to have been made by an employee (as, in these networks, will almost always be the case) the employer will be held liable unless it can establish its statutory defence,” Freer explained. Read the full article here.

    Employee Representation in Germany – Part 2

    January 11, 2018

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    Part II of III: Works Council Elections in Germany – Who Does What and How Are Election Proceedings Run?

    March 2018 is getting closer and works council (re)elections will again be on the agenda in Germany. We started this three-part blog last November with Jens Peters` introduction and overview to this topic.  See November 7, 2017 article. In this Part II, we briefly concentrate on the “Who does what” during the election proceedings and provide you with an overview of how election proceedings will run in an ordinary way.

    Who does what?

    The election committee (“Wahlvorstand”) is in the driver’s seat, with responsiblilities for leading and executing the election. Its main tasks are to inform the work force about the election and its proceedings (“Wahlausschreiben”) and to create the list of employees eligible to vote and to be voted (“Wählerliste”). If a works council already exists, the three-member election committee is appointed by the current works council; otherwise, the employees vote for the election committee in a staff meeting. The employer bears the costs of the election and is obliged to support the tasks of the election committee. In particular, the employer must provide the facilities, as well as all information requested to establish the voting lists. The current works council`s role during re-elections is limited to appointing the election committee, thereby initiating the works council elections.  It plays no further active role during the election proceedings. Last, but not least, the employees have the right to vote and to

    Mass Dismissal Filings in Germany – Do Leased Employees (“Leiharbeitnehmer”) Count?

    November 29, 2017

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    Collective redundancies and the complex issue of relevant dismissal thresholds for notification of the German Federal Employment Agency (“Bundesanstalt für Arbeit” or “the Agency”) were already addressed in an earlier June post this year.

    On November 16, 2017, the Federal Labor Court of Germany (“BAG” or “the Court”) submitted a case (BAG – 2 AZR 90/17) to the European Court of Justice(“ECJ”) which dealt with so-called leased employees. The question was whether, and under what requirements, leased employees or temporary workers need to be taken into account when applying the thresholds for mass dismissal filings in accordance with Sec. 17 I (1) Nr. 2 Kündigungsschutzgesetz/ KSchG (the German Act against Unfair Dismissal). Because this German Sec. 17 KSchG is based on the European Council Directive 98/95/EC, the Court had no choice but to submit this question to the ECJ. Until the ECJ has ruled – which may easily take up to two years – this important question will remain unanswered with serious and immediate practical consequences.

    Ironically, in the specific case pending before the Court, the employer took the position that a number of leased employees, who were temporarily assigned to their companies, should be accounted for under the threshold. Under this calculation, less than the 10% threshold would have been affected and, consequently, no filing requirements with the Agency would have been due.

    To complicate decisions for HR managers in Germany in crucial and difficult situations, the Court decided in other factual circumstances that regularly employed temporary workers

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