Flash Reports on Labour Law September 2020 Summary and country reports
Written by The European Centre of Expertise (ECE), based on reports submitted by the Network of Labour Law Experts
September 2020
EUROPEAN COMMISSION Directorate DG Employment, Social Affairs and Inclusion Unit B.2 – Working Conditions Contact: Marie LAGUARRIGUE E-mail: [email protected] European Commission B-1049 Brussels
Flash Report 09/2020
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Country Labour Law Experts Austria Martin Gruber-Risak Daniela Kroemer Belgium Wilfried Rauws Bulgaria Krassimira Sredkova Albena Velikova Croatia Ivana Grgurev Cyprus Nicos Trimikliniotis Czech Republic Nataša Randlová Denmark Natalie Videbaek Munkholm Mette Soested Estonia Gaabriel Tavits Elina Soomets Finland Ulla Liukkunen France Francis Kessler Germany Bernd Waas Greece Costas Papadimitriou Hungary Tamás Gyulavári Iceland Leifur Gunnarsson Ireland Anthony Kerr Italy Edoardo Ales Latvia Kristīne Dupate Liechtenstein Wolfgang Portmann Lithuania Tomas Davulis Luxemburg Jean-Luc Putz Malta Lorna Mifsud Cachia Netherlands Hanneke Bennaars Suzanne Kali Norway Marianne Jenum Hotvedt Alexander Næss Skjønberg Poland Leszek Mitrus Portugal José João Abrantes Isabel Valente Dias Romania Raluca Dimitriu Slovakia Robert Schronk Slovenia Barbara Kresal Spain Joaquín García Murcia Iván Antonio Rodríguez Cardo Sweden Andreas Inghammar Erik Sinander
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United Kingdom Catherine Barnard
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Table of Contents Executive Summary ...... 10
Austria ...... 16 1 National Legislation ...... 16 2 Court Rulings ...... 17 3 Implications of CJEU Rulings ...... 17 4 Other Relevant Information ...... 18
Belgium ...... 20 1 National Legislation ...... 20 2 Court Rulings ...... 20 3 Implications of CJEU Rulings ...... 22 4 Other Relevant Information ...... 24
Bulgaria ...... 25 1 National Legislation ...... 25 2 Court Rulings ...... 25 3 Implications of CJEU Rulings ...... 25 4 Other Relevant Information ...... 26
Croatia ...... 27 1 National Legislation ...... 27 2 Court Rulings ...... 28 3 Implications of CJEU Rulings ...... 28 4 Other Relevant Information ...... 28
Cyprus ...... 29 1 National legislation ...... 29 2 Court Rulings ...... 29 3 Implications of CJEU Rulings ...... 29 4 Other Relevant Information ...... 32
Czech Republic ...... 35 1 National Legislation ...... 35 2 Court Rulings ...... 39 3 Implications of CJEU Rulings and ECHR ...... 39 4 Other Relevant Information ...... 39
Denmark ...... 40 1 National Legislation ...... 40 2 Court Rulings ...... 41 3 Implications of CJEU Rulings ...... 41 4 Other Relevant Information ...... 43
Estonia ...... 44 1 National Legislation ...... 44 2 Court Rulings ...... 44
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3 Implications of CJEU Rulings ...... 44 4 Other Relevant Information ...... 44
Finland ...... 45 1 National Legislation ...... 45 2 Court Rulings ...... 45 3 Implications of CJEU Rulings ...... 46 4 Other Relevant Information ...... 46
France ...... 47 1 National Legislation ...... 47 2 Court Rulings ...... 48 3 Implications of CJEU Rulings ...... 50 4 Other Relevant Information ...... 50
Germany ...... 51 1 National Legislation ...... 51 2 Court Rulings ...... 52 3 Implications of CJEU Rulings and ECHR ...... 52 4 Other Relevant Information ...... 53
Greece ...... 54 1 National Legislation ...... 54 2 Court Rulings ...... 54 3 Implications of CJEU Ruling ...... 54 4 Other Relevant Information ...... 55
Hungary ...... 56 1 National Legislation ...... 56 2 Court Rulings ...... 56 3 Implications of CJEU Rulings ...... 57 4 Other Relevant Information ...... 57
Iceland ...... 58 1 National Legislation ...... 58 2 Court Rulings ...... 58 3 Implications of CJEU Rulings ...... 58 4 Other Relevant Information ...... 59
Ireland ...... 60 1 National Legislation ...... 60 2 Court Rulings ...... 61 3 Implications of CJEU Rulings ...... 61 4 Other Relevant Information ...... 62
Italy ...... 608 1 National Legislation ...... 63 2 Court Rulings ...... 64 3 Implications of CJEU Rulings and ECHR ...... 64
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4 Other Relevant Information ...... 65
Latvia ...... 66 1 National Legislation ...... 66 2 Court Rulings ...... 66 3 Implications of CJEU Rulings ...... 66 4 Other Relevant Information ...... 66
Liechtenstein ...... 67 1 National Legislation ...... 67 2 Court Rulings ...... 67 3 Implications of CJEU Rulings ...... 67 4 Other Relevant Information ...... 68
Lithuania ...... 69 1 National Legislation ...... 69 2 Court Rulings ...... 69 3 Implications of CJEU rulings and ECHR ...... 69 4 Other relevant information ...... 69
Luxembourg ...... 70 1 National Legislation ...... 70 2 Court Rulings ...... 70 3 Implications of CJEU rulings ...... 70 4 Other Relevant Information ...... 71
Malta ...... 72 1 National Legislation ...... 72 2 Court Rulings ...... 72 3 Implications of CJEU rulings and ECHR ...... 72 4 Other relevant information ...... 73
Netherlands ...... 74 1 National Legislation ...... 74 2 Court Rulings ...... 74 3 Implications of CJEU rulings and ECHR ...... 75 4 Other relevant information ...... 76
Norway ...... 77 1 National Legislation ...... 77 2 Court Rulings ...... 78 3 Implications of CJEU Rulings ...... 78 4 Other Relevant Information ...... 80
Poland ...... 81 1 National Legislation ...... 81 2 Court Rulings ...... 81 3 Implications of CJEU Rulings ...... 81 4 Other Relevant Information ...... 82
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Portugal ...... 83 1 National Legislation ...... 83 2 Court Rulings ...... 84 3 Implications of CJEU Rulings ...... 84 4 Other Relevant Information ...... 87
Romania ...... 88 1 National Legislation ...... 88 2 Court Rulings ...... 90 3 Implications of CJEU Rulings ...... 90 4 Other Relevant Information ...... 90
Slovakia ...... 91 1 National Legislation ...... 91 2 Court Rulings ...... 92 3 Implications of CJEU Rulings ...... 92 4 Other Relevant Information ...... 93
Slovenia ...... 94 1 National Legislation ...... 94 2 Court Rulings ...... 95 3 Implications of CJEU Rulings ...... 95 4 Other Relevant Information ...... 97
Spain ...... 98 1 National Legislation ...... 98 2 Court Rulings ...... 99 3 Implications of CJEU Rulings ...... 100 4 Other Relevant Information ...... 100
Sweden ...... 101 1 National Legislation ...... 101 2 Court Rulings ...... 101 3 Implications of CJEU Rulings ...... 101 4 Other Relevant Information ...... 102
United Kingdom ...... 103 1 National Legislation ...... 103 2 Court Rulings ...... 104 3 Implications of CJEU Rulings ...... 104 4 Other Relevant Information ...... 105
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Executive Summary National level developments the EU common approach to travel measures. In September 2020, extraordinary measures triggered by the COVID- New measures to regulate telework or 19 crisis still played an important role working from home have been adopted in the development of labour law in in Portugal and Spain, while some many Member States and European guidance on teleworking has been Economic Area (EEA) countries. adopted in the United Kingdom. The social partners are expected to take up This Summary is therefore again negotiations on teleworking in Austria. divided into an overview of developments relating to crisis New health and safety standards for measures, and the second part sums workplaces have been enacted in up other labour law developments with France, which now recognises COVID- particular relevance for the 19 as an occupational disease, and transposition of EU labour law. Portugal, which has extended sickness allowance to absence from work due to COVID-19. Developments related to the COVID-19 crisis Measures to alleviate the Measures to diminish the risk financial consequences for of infection in the workplace businesses and workers All countries still have measures in State-supported short-time work, place to prevent the spread of the virus temporary layoffs or equivalent in workplaces. The state of emergency, schemes remain in place in many threat or lockdowns have ended in countries. A new short-time work several countries. It was, however, scheme (“kurzarbeit”) has been extended or reintroduced in countries approved by the government in the such as Portugal, Romania and Czech Republic. Previously enacted Slovakia. Several reports mention a temporary schemes have been deterioration of the epidemic situation, provisionally extended in Austria (for which has interrupted the gradual re- six months, by agreement of the social opening of societal and economic life, partners), and the United Kingdom and has led to a gradual reintroduction (for six months from November, at a reduced rate). of stricter measures with respect to the wearing of face masks, the opening Programmes providing financial hours of restaurants, bars and mass benefits for workers who have temporarily been laid off due to the gatherings. This is the case in various epidemic crisis and/or self-employed countries, e.g. in Denmark, Slovenia, persons have been extended with Slovakia and the United Kingdom. In stricter eligibility criteria in Slovenia. addition, restrictions on the operation Financial benefits for self-employed of businesses and other establishments have been extended until 1 July 2021 have been introduced in the Czech in the Netherlands. Republic. A temporary extension of subsidies for Travel restrictions have been amended employers that hired employees who in many countries in accordance with have been laid off has been proposed in recent developments. Notably, the Norway. Special rules aimed at Czech report mentions that restrictions protecting workers and undertakings have been tightened, while they were against the effects of the COVID-19 slightly loosened in Slovenia following crisis, with the suspension of dismissals
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in favour of less damaging measures or suspension of teaching activities in and wage compensation scheme, have Romania. been extended in Spain until 31 Moreover, measures providing wage January 2021. compensation during quarantine have been extended and amended in Slovenia and Iceland, and have been Leave entitlements and social introduced in Greece. security
Special rules on entitlements to family- and care-related leave and sick leave Other measures to respond continue to apply in many countries. to the COVID-19 crisis The existing special care leave for parents were amended in Norway, Several measures of economic while it was extended in scope and mobilisation were introduced in refinanced in Austria. With the Slovakia, including the duty to work for beginning of the new school year, those employed by economic parental leave benefits have been mobilisation entities. extended to workers who have to stay In Hungary, the Constitutional Court home from work because their children has rejected a complaint against have contracted or must be tested for derogations from labour law regulations COVID-19 in Denmark, whereas a introduced by Article 6(4) of special child care leave has been Government Decree 47/2020. granted for parents in case of reduction
Table 1. Main developments related to measures addressing the COVID-19 crisis
Topic Countries Short-time work and similar AT CZ EL IS UK Benefits for workers / self-employed EL IS SL ES NL prevented from working Special care leave / parental leave AT DK NO RO Telework / working from home AT PT ES UK Wage compensation during quarantine EL SL IC Health and safety measures FR PT Employer subsidies NO Suspension of dismissal ES Restriction of business activity by CZ lockdown measures Work duty SK Derogations from labour law HU
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Other developments Regulation on the European Unemployment Support Scheme The following developments in (SURE). September 2020 were particularly relevant from an EU law perspective: In Germany, the Federal Labour Court has asked the CJEU for a preliminary ruling regarding paid annual leave. Posting of workers In Hungary, the Constitutional Court has rejected the complaint against In Finland, the government proposal Article 6(4) of Government Decree for the implementation of Council 47/2020 on derogations from labour Directive 2018/957/EU was approved law regulations. with amendments by Parliament. This was also the case in Ireland, where In Ireland, the Minister for Transport regulations implementing the Directive has issued two regulations have also been issued, and in Italy, implementing further provisions of where the government has adopted a Council Directive 2017/159/EU on the legislative decree to the same end. implementation of the ILO Work in Fishing Convention 2007, and
regulations have been issued to better Occupational safety and implement Article 21 of the Working Time Directive 2003/88/EC on sea health fishermen. In Croatia, a new ordinance on In Italy, the Corte di Cassazione held occupational health and safety at the that when an undertaking in crisis is workplace has been issued, abrogating transferred, the transferor’s employees the previous one and implementing have the right to be employed by the Directive 89/654/EEC. transferee, even if the latter applies In Germany, the Federal Council has different collective agreements. welcomed recent regulations to In Malta, a Court of Appeal has ruled strengthen occupational safety and that judges determining compensation improve working conditions in the meat for unfair dismissals should be guided industry, although the legal literature by principles of natural justice. continues to criticise the new regulation. In the Netherlands, the Rotterdam Court held that it cannot be ruled that a In Norway, the regulations on health, clause contained in a collective safety and the working environment of agreement precluding seafarers from construction sites have been amended, carrying out cargo handling services in aiming at a better implementation of a port where dock workers provide Directive 92/57/EEC. cargo handling is exempt from the scope of Article 101 TFEU based on the exception accepted by the CJEU in Other aspects Albany (CJEU, case C-67/96, 21 In Bulgaria, Parliament has ratified the September 1999, Albany BV v Stichting Voluntary Agreement for Guarantee in Bedrijfspensioenfonds Textielindustrie). accordance with Article 11 of EU
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Table 2: Other main developments
Topic Countries
Health and safety DE HR NO
Posting of workers IE IT FI
Collective bargaining IS NL SE
Dismissal FI FR MT
Paid annual leave FI DE
Minimum wage ES PL
Employment of foreigners FI RO
Teleworking AT UK
Psychological harassment LU RO
Seafarers work BG NL
European Unemployment Support BG (SURE)
Academic freedom CY
Subsidies for disability CZ
Pensions CZ
Collective action FI
Sunday work HR
Fishing work IE
Fixed-term work IE
Transfer of undertakings IT
Arbitration procedures LU
Subcontractor liability BE
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Implications of CJEU against the risk of employer insolvency. Rulings In this regard, a great number of Transfer of Undertaking national reports indicates that national law does not regulate occupational old- This FR analyses the implications of a age benefit schemes (HR, CZ, DK, EE), CJEU ruling on a transfer of or their management is not entrusted undertaking and the protection of to the employer, so that pension funds employees in the event of employer are not considered assets of the insolvency. employer for the purposes of transfers CJEU joined cases C-674/18 and or insolvency procedures (LV, LI, NO, C-675/18, 09 September 2020, TMD SI, SK, ES). In the latter case, Friction employees’ pension entitlements are not affected by transfers or The CJEU’s findings in these cases insolvencies. concerned the protection of employees in the event of a transfer of By contrast, various reports refer to undertaking subject to insolvency occupational old-age benefit schemes. proceedings with regard to a However, in many of these countries, supplementary occupational pension the transferee is fully liable for the scheme, pursuant to Articles 3(1) and transferor’s occupational pension (4) and Article 5(2)(a) of Directive commitments (e.g. BG, CY, FI, FR, 2001/23/EC relating to the HU, IS, LT, LU, PL, PT). safeguarding of employees’ rights in In the other countries, compensation the event of transfers of undertakings, for lost pension entitlements in case of and Article 8 of Directive employer insolvency is provided by 2008/94/EC on the protection of guarantee institutions, which refund at employees in the event of employer least 50 per cent of entitlements (e.g. insolvency. The Court held that the AT, BE, DE, IE, IT, MT, SE, UK). transferee is not liable for employees’ However, the German report has rights, prospective and accrued, raised concerns that in some cases, stemming from the supplementary compensation could be lower than half occupational pension scheme with of the value of the employees’ rights. respect to periods of employment that Moreover, the possibility of preceded the opening of insolvency underfunding of the Guarantee Fund proceedings. However, a minimum has been raised in some countries, e.g. protection of employees’ rights in Belgium, whereas the fact that conferring immediate or prospective these funds are administered by the entitlement to old-age benefits at least social partners could raise issues about equivalent to the level of protection whether the direct effect of Article 8 required under Article 8 of Directive could be relied upon in proceedings in 2008/94 must be guaranteed and Sweden. provided otherwise, meaning that at least half of the value of the The Greek report raises concerns that employees’ rights must be refunded. old-age benefits may fall outside the Specifically, the CJEU held that Article 8 scope of the Fund for Protection Against of Directive 2008/94 is capable of Employer Insolvency, with employees’ having direct effect, and consequently, pension rights only being taken into that provision can be relied upon in account in the framework of the proceedings against a body governed liquidation of the property of the by private law, designated by the pension scheme. Yet the report asserts Member State concerned as the body that only few supplementary that guarantees occupational pensions occupation schemes exist in the country.
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It seems to emerge from the reports according to which the exception of that rules on transfers of undertakings Article 5(1) is to be admitted are derogated from in case of exclusively where the insolvency insolvency in Estonia and Norway, procedure is aimed at the liquidation of without differentiations being made the undertaking. between insolvencies aimed at the Finally, the ruling could be relevant in liquidation or at the continuation of the the Netherlands, where a draft bill on undertaking’s activity. This seems to be transfers of undertakings in case of in contrast with what the CJEU held in employer insolvency is currently being paragraphs 61 and 62 of the ruling, discussed.
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Austria
Summary (I) Parliament has passed an amended version of the COVID-19 special care leave for parents. (II) The social partners have agreed on the conditions for another short-time work phase, starting 1 October 2020, for the upcoming six months. ______1 National Legislation 1.1 Measures to respond to the COVID-19 crisis 1.1.1 Special care leave The special paid leave for parents during the COVID-19 lockdown was one of the first legislative measures introduced to help families (see Flash Report 3/ 2020). It regulated that whenever childcare facilities or schools were partially or fully closed due to COVID-19 measures, employees who take care of children under the age of 14 and/or persons with special needs and whose work is not critical for the maintenance of the business may request additional paid leave. This special care leave can be taken for up to three weeks and is partially (one-third) funded by the government. This special care leave was in force until 31 May 2020. This provision § 18b of the Act on the Adaption of Contractual Employment Law (Arbeitsvertragsrechtsanpassungsgesetz – AVRAG) (old version) read as follows (unofficial translation by the authors): “If, due to official measures, facilities are partially or fully closed and if an employee whose work performance is not necessary for the maintenance of the business is not entitled to time off work to care for his or her child, the employer may grant the employee a special care period of up to three weeks, starting from the date of the official closure of the educational institution and childcare facility, for the care of children up to the age of 14 for whom care is mandatory. The same shall apply if there is a duty to care for disabled persons who are cared for or taught in an institution for persons with disabilities or in an educational establishment for persons with disabilities or in a school of higher education, and this institution or educational establishment or school of higher education is partially or fully closed in accordance with official measures. Employers are entitled to remuneration by the Federal Government of one-third of the remuneration paid to employees during the special care period. […]" In July 2020, Paragraph 1a was included: “Paragraph 1 shall apply mutatis mutandis for an additional three weeks to care for a child up to the age of 14 years for whom there is a duty of care, as well as of persons pursuant to para. 1 subpara. 1 to 3 in the period between the entry into force of this provision and 30 September 2020. The employer shall assert the claim for remuneration by 31 October 2020.” § 18b (1) AVRAG has now been amended and clarified further; moreover, government funding for employers has increased from 1/3rd of the costs to half of the costs. It has passed the two chambers of the Austrian Parliament but has not yet been published. “If, in accordance with official measures, facilities are partially or fully closed or if educational institutions and childcare facilities are closed during vacation or on school-free days according to § 2 para. 2 subpara. 1 lit. b, para. 4 subpara. 3 and para. 5 of the School Time Act 1985, BGBl. No. 77/1985, and is an
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employee whose work is not crucial for the maintenance of the business, and who is not entitled to time off to care for his or her child, the employer may grant the employee a special care period of up to three weeks from the date of official closure of the educational institution and childcare facility, to care for his or her children up to the age of 14 years, for whom there is a duty of care. The same applies, 1) if there is a duty to provide care for persons with disabilities who attend an institution providing assistance for persons with disabilities or an educational institution for persons with disabilities or a higher level school, and this institution or teaching institution, or the school, or the school itself which may not be a school of higher education, is partially or fully closed, or on the basis of voluntary measures, the care persons with a disability takes place at home, or 2) for relatives of persons in need of care, if their care or assistance is required as a result of the failure of a care taker in accordance with the home care law, BGBl. I No. 33/2007 is no longer guaranteed, or 3) for relatives of persons with a disability who are entitled to personal assistance, if personal assistance is no longer guaranteed as a result of COVID-19. Employers are entitled to remuneration by the Federal Government of half of the remuneration paid to employees during the special care period. […]" The amended special care leave will enter into force on 1 October 2020 and will remain in force until 28 February 2021. Employers may request funding until 30 June 2022. The amended special care leave is extended in scope, specifically addressing school holidays and parents who in the current situation are facing difficulties organising child care during the COVID-19 pandemic and care for other vulnerable groups. Also, funding has been extended from one-third to half of the payment the employer continues to pay during the special care leave. Special care leave has been criticised by some, mainly because the employer’s consent is required. It has also faced criticism from academics and the opposition party (Social Democrats, SPÖ) for the manner it was publicly advertised: the Minister of Education sent a letter to school children’s parents on the difficulties of upcoming school year. The letter was written in such a way that lead parents to believe that special care leave (§ 18b (1a) AVRAG) was the only legal means for them to stay home and continue to receive remuneration to take care of sick children. The letter omitted employees’ right to paid leave of absence for important reasons for a relatively short time, which allows parents to stay home and take care of their children if necessary— depending on the circumstance—for up to at least a week. This information was later changed on the official homepage of the Ministry of Labour.
1.2 Other legislative developments Nothing to report.
2 Court Rulings Nothing to report.
3 Implications of CJEU Rulings 3.1 Transfer of undertakings CJEU joined cases C-674/18 and C-675/18, 9 September 2020, TMD Friction
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Austria made use of the possibility to not apply the transfer of undertakings legislation in case of bankruptcy procedures as foreseen in Article 5 of Directive 2001/23. § 3 of the Act on the Adaption of Contractual Employment Law (Arbeitsvertragsrechtsanpassungsgesetz – AVRAG) reads as follows (unofficial translation by the author): “§ (1) If an enterprise, business or part of a business is transferred to another owner (transfer of business), the latter shall enter into the employment relationship that exist at the time of the transfer as the employer with all rights and obligations. (2) Para. 1 shall not apply in the event of reorganisation proceedings without the self-administration or bankruptcy proceedings of the vendor.” In such a case, the employment contracts (including entitlements to supplementary pension schemes) are not transferred. They are protected, however, by the Act on the Protection of Wages in Case of Employer Insolvency (Insolvenzentgeltsicherungsgesetz – IESG), which includes the following provisions in § 3d (3) on supplementary occupational pension schemes: “Insofar as the upper limits pursuant to paragraphs 1 and 2 do not guarantee the minimum level of protection required under Directive 2008/94/EC on the protection of employees in the event of employer insolvency, the insolvency payment shall be at least 1. half of the cash value of the entitlement to a pension from the employer’s direct benefit commitment pursuant to § 2 (2) Act on Company Pensions in conjunction with Article V, paragraph 3 of the Federal Act, Federal Law Gazette No. 282/1990, or entitlement from a benefit commitment not subject to the Act on Company Pensions, or 2. ….” As already pointed out in Flash Report 1/2020, the legislation’s duty was to bring it in line with Insolvency Directive 2008/94/EC and its interpretation by the CJEU. The wording is very much open to interpretation and refers to certain amounts with the words “at least”, opening up some leeway for the courts to interpret it extensively and flexibly to achieve the amendment’s aim to “guarantee the minimum level of protection required under Directive 2008/94/EC on the protection of employees in the event of the insolvency of their employer”. Austrian legislation on the protection of employees in case of employer insolvency, therefore, also covers supplementary occupational pension schemes to guarantee a certain level of pension payments. As the limitations in the IESG shall not apply “insofar as the upper limits (…) do not guarantee the minimum level of protection required under Directive 2008/94/EC on the protection of employees in the event of employer insolvency, the insolvency payment shall be at least … half of the cash value of the entitlement to a pension”, it is in line with the CJEU’s findings.
4 Other Relevant Information 4.1 New reduced time work scheme The current Austrian short-time work scheme has been extended until September 2020. The social partners have, in principle, agreed on a new short-time work scheme for the six months following September 2020, applicable for those sectors that are the most affected by the CoOVID-19 pandemic. The following general principles have been agreed upon: employees working under the short-time work scheme will continue to be paid 80%/85%/90% of net wages for their
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full employment, employers will continue paying the pro rata costs for the work being performed (remuneration). As previously, the Austrian Labour Market Services (AMS) will continue to compensate employers for the costs of hours not worked, including all ancillary wage costs and sick leave. Furthermore, a standardised procedure for the verification of the economic effect on the respective company (a precondition for short-time work funding) will be introduced. During the working hours not worked due to short-time work, employees are required to participate in training, which shall be partly (60 per cent) funded by the Labour Market Services (AMS). The orking hours can be reduced to a minimum of 30 per cent (currently: 10 per cent) and to a maximum of 80 per cent (currently: 90 per cent). It is also understood that in severely affected sectors (such as the hotel industry), a reduction below 30 per cent shall be possible. Details on the scheme and/or funding guidelines are not yet available, but will be published on the website of the Labour Market Services (AMS) which administers the funding process, which is available here.
4.2 Legislation/regulation on telework to be negotiated between the social partners The government has announced plans to commission the social partners to agree on proposals for a legislative framework on telework or ‘home office’ as it is now referred to in Austria. Various issues were mentioned, such as the use of operating resources, working time records, rest periods or tax benefits for commuters (the so-called “Pendlerpauschale”). The social partners are expected to take up negotiations in September, addressing the above-mentioned issues and presenting a proposal in March 2021 (!). More press information is available here, here and here.
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Belgium
Summary The Constitutional Court held that a financial sanction imposed on a primary contractor who is jointly and severally liable with a construction contractor that has social security debts is a criminal sanction within the meaning of Art. 6 of the ECHR and can therefore be litigated by the Labour Court. ______1 National Legislation Nothing to report.
2 Court Rulings 2.1 Subcontractor liability Constitutional Court, No. 104/2020, 09 July 2020 The facts and judicial procedure in this case were as follows: J.C. was a self-employed worker who had renovation works carried out on its business premises in 2013 by a company in the construction sector that was declared bankrupt on 03 March 2014 and had accumulated social security debt since the end of 2012. Due to a cerebrovascular accident, J.C. had been incapacitated for work since 2016. On 23 March 2015, the National Social Security Office (NSSO) claimed a total amount of EUR 16 665.10 from J.C. who had engaged a contractor who, at the time of the conclusion of the contract and at the time of payment of the invoices, had social security debts with the NSSO. This made J.C. jointly and severally liable for payment of those debts for the amount of work carried out excluding VAT, pursuant to Article 30bis, §3 of the Law of 27 June 1969 on Employees’ Social Security Contributions (hereinafter referred to as ‘the Employees’ Social Security Contributions Law’), and that he was obligated to withhold 35 per cent of the price owed to the construction company based on Article 30bis, §4 of the Employees’ Social Security Contributions Law plus an allowance in accordance with Article 30bis, §5 of the same law. In first instance, the Liège Labour Court ruled that the joint and several liability claim based on Article 30bis, §§ 3 and 4 of the Employees’ Social Security Contributions Act was of a compensatory nature and was therefore well founded. On the other hand, the Labour Court considered that the additional allowance referred to in Article 30bis, §5 of the Employees’ Social Security Contributions Law and equal to the amount owed by J.C. to the NSSO was of a dissuasive and repressive nature, so that it was to be considered the subject of a measure of suspension or postponement. In this respect, the Court ordered J.C. to pay the amount in addition to a supplement, this order being accompanied by a three-year postponement. The National Social Security Office has lodged an appeal against this sentence with the Liège Labour Court of Appeal. Having established J.C.’s apparent good faith and the financial difficulties resulting from the repayment claimed in this regard, the Liège Labour Court of Appeal decided to refer a preliminary question to the Constitutional Court (see here). This dispute falls within the scope of the social security contributions system for employees. It is, however, closely related to the employment of workers in the construction sector. In practice, the legal regulation has serious repercussions for
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principals and primary contractors, who face a heavy form of chain liability with additional amounts owed to the NSSO. In this judgment of 09 July 2020, the Constitutional Court assessed the criminal or non-criminal nature of the financial sanction or ‘supplement’ referred to in Article 30bis of the Employees’ Social Security Contributions Law. This article provides for an allowance of 35 per cent at the expense of the ‘principal’ who has not made a deduction to the NSSO with respect to work carried out by a contractor that has accumulated social security debts. If the sanction is compensatory in nature and only aims at repairing the damage suffered by the social security administration, a reduction is only possible in cases provided for by law. If the sanction is criminal in nature, a test of reasonableness is possible and all elements of the case including, among others, the good faith of the principal, are taken into account. In addition to the necessary vigilance at the time of the conclusion of the agreement, the principal builder or primary contractor should verify whether the (sub)contractor has any social security debts at the time of each payment of part of or all of the (sub)contractor’s fee during the course of the agreement. If the (sub)contractor has accumulated social security debts, the principal builder or primary contractor will have to withhold 35 per cent of the amount (payment) owed to the (sub)contractor, excluding VAT, and transfer it to the NSSO. If, on the other hand, the aforementioned obligations to withhold and to transfer the 35 per cent are not (correctly) fulfilled, the joint and several liability remains unaffected. In the latter case, in addition to this joint and several liability, an additional financial sanction or supplement will be imposed equal to 35 per cent of the amount still to be deposited. The maximum liability for social security debts is therefore the amount of the fee paid, minus any amount withheld and paid, plus a penalty of 35 per cent of the amount wrongfully withheld and paid. In addition, the liability is staggered or subsidiary. This means that it is transferred to any previous client in the event of non-payment by another client in the chain. With the above-mentioned judgment of the Constitutional Court of 09 July 2020, a ground for a reduction of the additional allowance was put forward. According to the Constitutional Court, the 35 per cent benefit in question, which is ‘not intended to make good damage caused to the National Social Security Office’, is on the contrary predominantly repressive in nature and therefore constitutes a sanction of a penal nature within the meaning of Article 6, paragraph 1 of the European Convention on Human Rights. With this judgment, the Court is diametrically opposed to the settled case law of the Belgian Cour de Cassation, which holds that the aforementioned benefit is not a penalty, but a lump sum compensation to restore the affected financing of social security (Cass. 19 November 2007, Rechtskundig Weekblad 2008-2009, 1219; Cass; 27 June 2016, Rechtskundig Weekblad 2016-2017, 1188; Cass. 11 December 2017). The Constitutional Court’s opinion that the supplement is a criminal sanction also implies that certain (criminal) guarantees are involved. Thus, the principle of proportionality of criminal or administrative sanctions applies. This principle implies that the sanction pronounced by the court or by the administrative authority must be in reasonable proportion to the offence that has been committed, taking into account all of the elements of the case. This makes it possible—contrary to the legal provisions—to reduce the sanction introduced by taking all pertinent elements into account, such as the person’s past record, the efforts made, the person’s ability to change his/her behaviour, or even his/her good faith.
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3 Implications of CJEU Rulings 3.1 Transfer of undertaking CJEU joined cases C-674/18 and C-675/18, 9 September 2020, TMD Friction The CJEU rulings C-674/18 and C-675/18 concern a supplementary occupational pension scheme in a German company. Insolvency proceedings had been initiated against the company. The insolvency proceedings were not aimed at the liquidation of the transferor’s assets but the continuation of its activities following the transfer (point 62 of the ECJ ruling). The insolvency proceedings aimed at ensuring the continuation of the transferor’s business activity. It was thus not a bankruptcy or analogous insolvency proceeding. Article 3(4)(a) of Directive 2001/23 allows Member States to decide that the main principles of Directive 2001/23 do not apply to employees’ rights to old-age, invalidity or survivors’ benefits under a supplementary occupational pension scheme outside the statutory social security pension scheme of the Member State, although the Member States can prescribe otherwise. According to German labour law, the German legislator did stipulate otherwise and used the option to apply the legal protection of Directive 201/23 to employees’ rights to benefits under a supplementary occupational pension scheme, even if the transfer occurs in the course of insolvency proceedings instituted with respect to the transferor (point 58). Rights to old-age, invalidity or survivors' benefits are transferred if they are contained in the individual contract of employment or the relevant collective agreement. To better understand the significance of CJEU rulings C-674/18 and C-675/18 on the interpretation of § 613a of the German Bürgerliches Gesetzbuch implementing Directive 2001/23 on the transfer of undertakings, a few differences with Belgian labour law need to first be pointed out. According to Belgian labour law on transfers of undertakings, Article 4 of the cross- industry Collective Bargaining Agreement (CBA) 32bis, concluded in the National Labour Council on 07 June 1985 and declared universally binding by the Royal Decree of 25 July 1985, stipulates that the rules on transfers of undertakings do not apply to employees’ rights to old-age, invalidity or survivors’ benefits under a supplementary occupational pension scheme outside the statutory social security pension scheme. The Belgian insolvency proceedings that are most comparable with the German ones mentioned above is the transfer of an undertaking or part of an undertaking under judicial authority. This procedure is regulated by Article XX.86 of the new Economic Law Code and is not aimed at winding up the assets of the company. The article itself contains important rules but also provides that the detailed rules for the transfer of the rights and obligations of employees involved in a transfer of undertaking under judicial authority will be clarified in an intersectoral Collective Bargaining Agreement (CBA) concluded in the National Labour Council and declared universally applicable by Royal Decree. This was the case with the conclusion of CBA No. 102, concluded in the National Labour Council on 05 October 2011, and declared universally binding by the Royal Decree of 14 April 2013. Article 3 of this CBA again stipulates that the CBA does not regulate the transfer of the rights of employees under the old-age, survivors’ and invalidity benefit schemes granted under supplementary social security schemes. However, Article 3 also stipulates that Collective Labour Agreement No. 102 is without prejudice to special schemes arising from the law and other collective bargaining agreements. The circumstances of the German case cannot arise in Belgium, hence the significance of rulings C-674/18 and C-675/18 is limited. In accordance with Article 3(4)(b) of Directive 2001/23, if the Member States do not apply the rules of the Directive on transfers of undertakings to the employees’ rights
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to old-age, invalidity or survivors’ benefits under a supplementary occupational pension scheme outside the statutory social security pension scheme, the Member States must adopt the measures necessary to protect employees’ interests—including those employees no longer employed in the transferor’s business at the time of the transfer—in respect of rights conferring on them immediate or prospective entitlement to old-age benefits and survivors’ benefits under supplementary schemes referred to in Article 3(4)(a) of that Directive (see ECJ point 54). The significance of the rulings C-674/18 and C-675/18 is that the wording of Article 3(4)(b) of Directive 2001/23, in essence, reproduces Article 8 of Insolvency Directive 2008/94 (ECJ point 73). Further, Article 5(2)(a) of Directive 2001/23, which concerns transfers of undertakings in the event of insolvency proceedings, expressly requires a minimum protection that is at least equivalent to that provided for in the situations covered by the Insolvency Directive. “It follows that the measures necessary for the protection of the interests of employees that must be adopted by the Member States under Article 3(4)(b) of Directive 2001/23 must be understood to include, in any event, the measures prescribed by Insolvency Directive 2008/94, designed to deal with the insolvency of their employer, whether the employer is the transferee or, as in this instance, the transferor”. As regards the minimum protection required by Article 8 of Directive 2008/94, the Court highlights that the correct transposition of that provision requires a former employee to receive, in the event of the insolvency of his or her employer, at least half of the old-age benefits deriving from accrued pension rights under a supplementary occupational pension scheme and that that provision obligates Member States to guarantee, in that event, to each former employee the compensation corresponding to at least one half of the value of his or her rights conferring immediate entitlement under such a scheme (see point 79 ECJ). Article 2(2) of the Insolvency Directive 2008/94 provides that that Directive is to be without prejudice to national law as regards the definition of, inter alia, the terms ‘right conferring immediate entitlement’, on the one hand, and ‘right conferring prospective entitlement’, on the other. Consequently, the Insolvency Directive does not preclude a Member State from treating as a different category of rights conferring prospective entitlement those which are definitive. However, the recognition that Member States have such discretion cannot have the result that the effectiveness of the provisions of that Directive, particularly Article 8 of that Directive, is undermined. That would be the case if a Member State were permitted to exclude certain categories of rights conferring prospective entitlement, with the meaning of its domestic law, from the scope of the obligation to ensure minimum protection that is imposed under Article 3(4)(b) of Directive 2001/23, read in the light of Article 8 of Directive 2008/94, with respect to all rights conferring prospective entitlement (points 90 en 91 ECJ). According to Belgian law, CBA No. 102, as already mentioned, is without prejudice to special arrangements arising either from the law and regulatory provisions or from other collective bargaining agreements. As regards special schemes based on a law, reference may be made to the legislation on prudential control, namely the Law of 13 March 2016 on the status and supervision of insurance or reinsurance undertakings and the Law of 27 October 2006 on the supervision of institutions for occupational retirement provision. The prudential supervision is exercised by the Belgian Banking, Finance and Insurance Commission. As regards supplementary social security schemes based on a collective bargaining agreement, the protection of employees' interests with regard to their rights arising from these schemes is already ensured pursuant to Article 20 of the Collective Bargaining Law of 05 December 1968, which stipulates that when a company is
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transferred in whole or in part, the new employer must respect the collective bargaining agreement binding the former employer until it ceases to have effect. In other cases, according to the current state of Belgian law, the regulation of employees’ rights is the subject of negotiations between the transferor and the transferee. Article 37, § 1 of the Law of 28 April 2003 on Supplementary Pensions stipulates that the transfer of an undertaking, business or part of an undertaking or business to another undertaking or business as a result of a conventional transfer or merger may under no circumstances lead to a reduction in the reserves of affiliates acquired at the time of the transfer. Belgium has not made use of the option provided by Article 6 of the Insolvency Directive to exclude the guarantees of the Belgian guarantee institution to contributions due under supplementary occupational or inter-occupational pension schemes outside the national statutory social security schemes. Contributions thus seem to be included in the benefits for which the Belgium indemnity fund guarantees payments in the event of closure of companies. This is not the place to substantiate whether Belgian legislation has fully implemented the Insolvency Directive. In the European Commission’s report, Belgium does not appear to be a major offender (see Report of 28 February 2011 from the Commission to the European Parliament and the Council on the implementation and application of certain provisions of Directive 2008/94/EC on the protection of employees in the event of the insolvency of their employer, COM/2011/0084 final). The Belgian Guarantee Fund (the Closure of Undertakings Fund) only intervenes up to a guaranteed amount. As a result, some lawyers specialised in insurance law have written critical comments on the scope of the protection of supplementary occupational pensions against the insolvency of the employer. As far as Belgium is concerned, the risk that both the pension institution is severely underfunded and the employer goes bankrupt is relatively limited. However, this is not imaginary. If this situation were to occur, it is likely that the above-mentioned relatively limited ceiling on the interventions of the Closure Fund would result in less than half of the acquired supplementary pension rights being protected. In application of this European case law, this would mean that the Belgian authorities would be obligated to pay compensation to the injured employees concerned: see A. Van Damme and I. De Somviele, Aanvullende pensioenen (Supplementary Pensions), Mechelen, Wolters, Kluwer 2016, 134. The CJEU reiterates that Article 8 of Insolvency Directive 2008/94 is capable of having direct effect, and consequently decided that the provision can be relied upon in proceedings against a body governed by private law, designated by the Member State concerned as the body guaranteeing occupational pensions against the risk of insolvency of employers. The horizontal effect the Insolvency Directive is of relevance for Belgian labour law because the function of the Belgian Guarantee Fund (the Closure of Undertakings Fund) is not transferred to a body governed by private law.
4 Other Relevant Information Nothing to report.
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Bulgaria
Summary (I) A new act implements the Amended International Convention on Safety of Human Life at Sea of 1974, with effects for the occupational safety of seafarers. (II) The Bulgarian Parliament has ratified the Voluntary Agreement for Guarantee according to Article 11 of the EU Regulation on the European Unemployment Support scheme (SURE). ______1 National Legislation 1.1 Measures to respond to the COVID-19 crisis 1.1.1 Occupational safety of seafarers The Ministry of Transport, Informational Technologies and Communications published the amendments to the International Convention on Safety of Human Life at Sea of 1974 (State Gazette No. 82 of 18 September 2020). This Convention is directly applicable in Bulgaria (Article 5 para. 2 of the Constitution). It contains crucial rules on the safety of persons at sea. It relates to the European Conventions on water transport.
1.1.2 SURE – European Unemployment Support scheme The National Assembly (Parliament) adopted the Act on Ratification of the Voluntary Agreement for Guarantee in accordance with Article 11 of Regulation (EC) 2020/672 of the Council SURE – the European instrument for temporary support aiming to mitigate the risks of unemployment in cases of extraordinary circumstances due to COVID-19 between the European Commission and the Republic of Bulgaria. It was published in State Gazette No. 82 of 18 September 2020.
1.2 Other legislative developments Nothing to report.
2 Court Rulings Nothing to report.
3 Implications of CJEU Rulings 3.1 Transfer of Undertakings CJEU joined cases C-674/18 and C-675/18, 9 September 2020, TMD Friction This ruling is of slight significance for Bulgarian law. Bulgaria has an occupational pension scheme which is a supplementary and voluntary pension insurance, but it is not widespread within the Bulgarian pension system. There is only one institution for occupational retirement insurance, “DSK—Rodina” and has too few members. It also has limited experience.
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The occupational scheme is defined as rules for supplementary voluntary retirement insurance stipulated in a collective bargaining contract or in a collective agreement between the sponsoring undertaking (insurer) and the insured persons (Art. § 1 (2), item 2 related to item 11a Additional Provisions of Social Insurance Code – AP SIC). Under § 1 (2), item 11a AP SIC, the sponsoring undertaking is a social insurance contributor (insurer) or any undertaking or any other organisation that includes or consists of one or more natural persons or legal entities, which act as an employer, a commissioning entity or when in a self-employed capacity or combines these three capacities and pays contributions into an institution for occupational retirement insurance, and to which the labour and social legislation of another Member State applies. The social insurance contributions finance the occupational pension scheme. These contributions are only paid by the insurer or are divided between the insurer and the insured person. The contributions shall be recorded and accrued on the individual account of each insured person on the date of receipt of the said contributions on the account of the fund. Each insured person may have only one individual account with a fund for supplementary voluntary retirement insurance under an occupational scheme. The contributions, the amounts transferred and the deductions made to the individual account must be recorded (Article 234 SIC). In cases of transfers of (insurer) undertaking following the opening of insolvency procedures, the rules on the changes of the employer shall apply. Social insurance under occupational schemes shall be regulated in a collective bargaining contract. Pursuant to Article 55 (2) of the Labour Code, in case of change of the employer, the existing collective agreement shall be valid until the conclusion of a new collective agreement, but for not more than one year after the date of change in employer. This means that the new employer has the obligation to pay the contributions for the term of the collective agreement. An occupational pension scheme entitles the insured person to: a fixed period old-age pension; a lump-sum payment or payment in instalments of the resources accrued on the individual account; a lump-sum payment or payment in instalments of resources to the survivors of a deceased insured person or of a pensioner (Article 212 (2) SIC). Entitlement to a personal old-age pension based on insurance from a fund for supplementary voluntary retirement insurance under occupational schemes shall arise upon attainment of the age of 60 years for women and men (Article 234 (4) SIC). The amount of the pension shall be determined on the basis of the amount accrued in the individual account; the period of receipt; the technical interest rate (Article 246 (1)— (2) SIC). The employer (insurer) does not have any obligations in such cases. Bulgaria does not have a defined benefit plan for this type of insurance like Germany.
4 Other Relevant Information 4.1 Wages An analysis by the Ministry of Finance reports that EU funds have led to an increase in wages by 8.2 per cent in the period 2014 to mid-2020. Over the same period, the country's GDP grew by 7.7 per cent compared to the baseline scenario without EU funds. During the second programming period for Bulgaria in 2014-2020, access to EU funds totalling EUR 9.9 billion was available under 10 programmes. Compared to the previous programming period, an increase of 5.2 per cent was registered. EU funds have resulted in private business investments of 19.7 per cent, created new jobs and raised income and consumption.
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Croatia
Summary (I) A new Ordinance on Occupational Health and Safety at the Workplace has been issued, abrogating the previous Ordinance on the same subject. (II) The Tax Law has been amended. Any costs carried by the employer for his/her employees’ COVID-19-related laboratory testing are not to be considered a salary for fiscal purposes. Other epidemiological measures differ from county to county. (III) The Constitutional Court has held that the decision prohibiting stores from operating on Sundays for epidemiological reasons was not in line with the principle of proportionality. ______1 National Legislation 1.1 Measures to respond to the COVID-19 crisis 1.1.1 Amendment to the Ordinance on Enforcement of General Tax Law (Official Gazette No. 103/2020) Among others, a provision on the costs of laboratory testing for COVID-19 paid by the employer for his/her employees has been introduced in the Ordinance on Enforcement of General Tax Law. It is not considered salary in the context of tax law.
1.1.2 Epidemiological measures Epidemiological measures differ from county to county. For instance, in the Krapina- Zagorje County, employees of social service providers are recommended to not attend professional meetings and other collectively organised forms of employee trainings (congresses, symposia, lectures, workshops, etc.). Records of all participants in indoor gatherings must be kept if more than 20 people are present, and must include basic information (name, surname and telephone number of the persons present).
1.2 Other legislative developments 1.2.1 Occupational health and safety The Minister of Labour has issued the Ordinance on Health and Safety at the Workplace (Official Gazette No. 105/2020) which has abolished the previous Ordinance on Health and Safety at the Workplace (Official Gazette No 29/2013). The abolished Ordinance as well as the current one transpose Directive 89/654/EEC into Croatian law. The novelties introduced in the Ordinance on Health and Safety at the Workplace refer to work at home (the abolished Ordinance did not mention work at home at all). Furthermore, the provision on surveillance of employees via monitoring devices has been abolished. Details on walls and emergency routes have been introduced as well, among others.
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2 Court Rulings 2.1 Sunday work in the commercial sector Constitutional Court of the Republic of Croatia, U-II-2379/2020, 14 September 2020 The subject of the legal assessment was the decision of the Civil Protection Headquarters, which had banned stores from operating on Sundays, allegedly for epidemiological reasons. The Constitutional Court of the Republic of Croatia arrived at the conclusion that there were no objective and rationally justified epidemiological reasons for adopting the regulation. According to the Constitutional Court, the decision that stores could not be open on holidays, non-working days or on Sundays was not necessary. Since the most frequent shopping day is Friday, and the virus is spread by droplets in particular where a large number of people gather indoors, there would be more justification to designate Friday as a non-working day (for epidemiological reasons) to prevent a large gathering of people in stores. According to the Constitutional Court, by adopting the impugned measure, the Headquarters did not act in accordance with the principle of proportionality.
3 Implications of CJEU Rulings 3.1 Transfer of undertaking CJEU joined cases C-674/18 and C-675/18, 9 September 2020, TMD Friction Directive 2001/23 has been transposed into Croatian law by the Labour Act (Article 137). On the other hand, Directive 2008/94 has been transposed by the Act on Safeguarding Employees’ Claims of 2017. However, as regards Article 8 of Directive 2008/94, the Act on Voluntary Pension Funds of 2014 (as amended in 2018) is of relevance. Occupational benefit schemes cannot be offered in Croatia (expressly stated in Article 266(2) of the Act on Voluntary Pension Funds). Hence, since employers are not allowed to manage any supplementary pension schemes, Article 8 of Directive 2008/94 is not applicable in Croatia. Therefore, the ruling of the CJEU in joined cases C-674/18 and C-675/18 has no implication for Croatian law.
4 Other Relevant Information Nothing to report.
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Cyprus
Summary The Ministry of Education has initiated a disciplinary action against a teacher whose paintings were published on his Facebook page and deemed offensive. This seems to contravene the right to academic freedom recognised by both Cypriot and European law, notably in Article 13 of the CFR. ______1 National legislation Nothing to report.
2 Court Rulings Nothing to report.
3 Implications of CJEU Rulings 3.1 Transfer of undertaking CJEU joined cases C-674/18 and C-675/18, 9 September 2020, TMD Friction This is a transfer of undertaking case that may have some implications for Cypriot national law. The Cypriot law on transfers of undertakings is the Law on Safeguarding and Securing the Rights of Employees in the event of a transfer of undertaking, business, or part of a business 104(I)/2000 , as amended by Law 39(I) of 2003 and by Law 162(I)/2018 (hereinafter ‘the Cypriot transfer law’, for the law text see here). Since it has been in force, three cases have been dealt with before the Supreme Court. The basic law of 2000 was based on the two previous Directives, 77/187/EEC and 98/50/EC, consolidated under Directive 2001/23/EC. The amendments introduced by Law No. 39(I) of 2003 are minor and concern the definition of the term ‘economic, technical and organisational reasons’; the determination of the competent court, which by virtue of Section 8A is the Labour Disputes Court; and the manner of calculation of compensation due to the employee, which is introduced by Section 10 of the amalgamated law. The Cypriot Transfer Law applies to transfers of undertakings businesses or parts of businesses to another employer as a result of a legal transfer or merger (see Section 3(1) of the Cypriot Transfer Law), including public and private enterprises engaged in economic activities, irrespective of whether they are profit making or not. An administrative reorganisation of public authorities or the transfer of administrative functions between public administration authorities shall not be deemed a ‘transfer’ within the meaning of this law (see Section 3(3) of the Cypriot Law).The definitions contained in Article 2.1 of the Directive are inserted verbatim into Article 2 of the Cypriot law. As for the term ‘employee’, this is described in Cypriot law as a person working for another person, either under a contract of employment or apprenticeship or under such circumstances that the existence of an employment relationship may be inferred. The Cypriot law makes no mention of the excluded limitations set out in Article 2.2 of the Directive. It may therefore be inferred that the Cypriot law does not exclude from its scope any of the employment contracts or the employment relationships described in Directive Article 2.2. The 2018 amendment, Law 162(I)/2018, changed the law’s scope of application. Prior to the 2018 amendment, Section 3(4) provided that this Law shall not apply to
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maritime vessels (the Greek text reads: ‘3(4) Ο παρών Νόμος δεν εφαρμόζεται επί θαλάσσιων σκαφών’). The new Section 3(4) provides that this law shall apply to the transfer of a Cypriot seagoing vessel which is part of the transfer, operation, installation or part of a business or installation within the meaning of the provisions of subsections (1), (2) and (3), provided that the transferee has its registered office or the transferred enterprise, establishment, or business or establishment department remains within the scope of the Treaty of the Functioning of the European Union (the Greek text reads: “3(4) Ο παρών Νόμος εφαρμόζεται σε μεταβίβαση κυπριακού ποντοπόρου σκάφους το οποίο αποτελεί μέρος μεταβίβασης, επιχείρησης, εγκατάστασης ή τμήματος επιχείρησης ή εγκατάστασης κατά την έννοια των διατάξεων των εδαφίων (1), (2) και (3), υπό τον όρο ότι ο εκδοχέας έχει την έδρα του ή η μεταβιβασθείσα επιχείρηση, εγκατάσταση, ή το τμήμα επιχείρησης ή εγκατάστασης παραμένει εντός του πεδίου εδαφικής εφαρμογής της Συνθήκης για τη Λειτουργία της Ευρωπαϊκής Ένωσης.”) Also, the new Section 4(5) explicitly provides that this law does not apply when the object of the transfer consists exclusively of one or more seagoing vessels (the Greek text reads: ‘3(5) Ο παρών Νομός δεν εφαρμόζεται όταν το αντικείμενο της μεταβίβασης αποτελείται αποκλειστικά από ένα ή περισσότερα ποντοπόρα σκάφη.’). In Civil Appeal case No. 179/2009, 20 September 2012, Loris Savvides v SSP Catering Cyprus, Redundancy Find and CTC- ARI Airports Ltd, the appellant was an employee of SSP Catering (Respondent No.1), who was managing the shops of Larnaca Airport on the basis of a contract. In 2006, Respondent No.1 informed the appellant that the management of the airport was being taken over by an investor and that they would no longer be managing the airport shops, therefore, his services were being terminated on the ground of redundancy. At the same time, Respondent No.1 also dismissed 22 more employees and informed the competent ministry accordingly. Respondent No. 3, who took over the airport shops from the investor, proposed to hire the appellant but he declined. The appellant then sued Respondent No.1 at the Labour Tribunal for compensation for unlawful termination of his employment contract. Respondents 1 and 3 claimed that this was not a case of transfer of undertaking and therefore, the provisions of Directive 2001/23/EC and the transposing legislation (No. 104(I)/2000) did not apply. The Redundancy Fund disputed this argument, claiming that this was a transfer of undertaking and the relevant Directive applied. The trial court rejected the claims against all three Respondents. It ruled that a transfer of undertaking from Respondent 1 to Respondent 3 had taken place within the meaning of the Directive, as Respondent 3 continued the operations of Respondent 1 and proposed employment to the appellant on the same conditions as previously and with more favourable terms on the basis of a new collective agreement. The trial court concluded that the appellant was not entitled to compensation for redundancy, either, because he had rejected the offer for employment from Respondent 3. The appellant appealed against the trial decision, arguing that no transfer of undertaking had taken place within the meaning of the Directive because Respondent 1 had only transferred vacant possession of the shops to Respondent 3; moreover, the identity of the undertaking had not been retained so there was no information as to what type of enterprise the investor would set up. The Court of Appeal agreed with this argument and allowed the appeal. It pointed out that the trial court appeared to have been influenced by the appellant’s refusal to accept Respondent 3’s employment offer, which was not the operative factor in this case. The second case, Civil Appeal No. 359/2009, 26 November 2014, CTC – ARI Airport Ltd v Charalambos Andreou, SSP Catering Cyprus Ltd. Redundancy Fund is factually along the same lines as the previous case but different in outcome. Along the same facts as Loris Savvides (above), Respondent No. 2 was managing the Larnaca airport shops until 2006 when the government assigned the management of the airport to an investor, namely Hermes Airport Ltd (Hermes). Hermes informed Respondent 2 that its contract for management of the airport shops would be terminated and that the management would be taken over by CTC-ARI Airports Ltd (the appellant).
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Respondent 1, who was at the time employed by Respondent 2, was informed that his services would, in turn, be terminated due to redundancy. Respondent 1 applied to the Redundancy Fund for compensation but his application was rejected on the ground that he had refused to continue working at the airport as an employee of the appellant. Τhe trial court found that that termination of the employment of Respondent 1 was unlawful, as the obligations of the transferor of an enterprise are assigned to the transferee to ensure continuation of the employment of the workers by the new employer. The Appeal Court affirmed the findings of the trial court, clarifying that the obligations of Respondent 2 were, by operation of the law, assigned to the appellant and that the obligation towards the dismissed employee amounted to a duty to pay compensation and not to offer continuation of the employment relationship. The court rejected the appellant’s argument that they had no obligation to compensate Respondent 1 because he had rejected their offer of employment. On appeal, the Supreme Court endorsed the trial court’s finding that the law transposing the Directive does not compel an employee to remain in the service of the transferee and that each employee has the freedom to decide whether he/she will continue working for the new employer or not. However, the Court of Appeal found that the trial court had erred in that it had assumed that the appellant did not make a firm and specific offer of employment to Respondent 1. Through testimony delivered at the hearing, it became clear that Respondent 1 had unequivocally informed the appellant that he was not interested in continuing to work at the airport shops because he was tired and wanted to rest, which was the reason why the appellant did not proceed to make a firm offer to him, as it had done with the other employees. The unequivocal position of Respondent 1 that he did not want to continue working was also the reason why the appellant proceeded to restructure the enterprise as a result of which the position previously held by Respondent 1 was cancelled. As a consequence of the refusal of Respondent 1 to work for the appellant, there was no right to compensation either from the appellant or from the Redundancy Fund. The Court differentiated this case from the facts of Loris Loizides (above), where the court found that there was an entitlement to compensation from the Redundancy Fund, in that the respondent in this case was seen as unreasonably refusing the offer of other suitable employment, which according to Article 20(a) of Law 24/1967 caused him to lose his right to redundancy compensation. The Court of Appeal therefore allowed the appeal and set aside the trial court decision. The third case was Civil appeal case No. 11418, 16 July 2003, 1 Α.Α.Δ. 1078, Giannoula Tomazou and others v Redundancy Fund. The Supreme Court ruled that the Labour Court had correctly rejected the applications of the appellants (under para. 7, Part ΙΙ of the Second Table of the Law on Termination of Employment 24/67.) on the ground that, inter alia, the new company had been established to ensure the continuity of the supply of services from the appellants, given that none of them had registered as unemployed during the substantive time and the appellants had been paid for the full amount of their monthly pay without any break. (The relevant text of the court decision (in Greek) reads as follows: “η νέα εταιρεία είχε συσταθεί για να διασφαλιστεί το συνεχές της προσφοράς υπηρεσιών από τους εφεσείοντες αφού κανείς από αυτούς δεν είχε εγγραφεί άνεργος κατά τον ουσιώδη χρόνο, και οι εφεσείοντες είχαν πληρωθεί ολόκληρο το μισθό για το μήνα Φεβρουάριο από τη νέα εταιρεία χωρίς καμμιά διακοπή“.) The Supreme Court also approved the Labour Court’s ruling that the new company had taken over the reputation, the clients, the volume of work and all of the equipment of the employer/transferee company. (The relevant text of the court decision (in Greek) reads as follows: “Το δικαστήριο ορθά θεώρησε ότι περαιτέρω, η νέα εταιρεία είχε αναλάβει τη φήμη, την πελατεία, τον κύκλο εργασιών και όλο τον εξοπλισμό της εργοδότριας εταιρείας“.)
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4 Other Relevant Information 4.1 Academic freedom An issue dominating the public debates relating to the Ministry of Education announcing its decision to take disciplinary action against a head teacher in a public secondary school, who is also a well-known painter/artist (George Gabriel). The allegations are that his paintings, which were shown on his Facebook page, contain elements that are offensive to the religion of Orthodox Christians. His paintings depict Christ as refugee amongst refugees in detention centres, Christ on a motorcycle and as a football fan, etc. Other paintings show a critical perspective: for instance, there is a painting of a dog urinating on a statue of a controversial figure in recent history, Georgios Grivas, who is seen as a hero by some and a traitor and murderer by others. There is also a painting of the Archbishop in his glorified golden outfit with a dog urinating on him. There was a furious public intervention of the Archbishop calling for the teacher’s immediate dismissal for offending Christ and the nation and described his paintings as obscene and unacceptable. However, on the other hand, there was a powerful opposition by numerous legal, academic and art institutions and citizens who called on the Ministry of Education to end the disciplinary action against the employee and artist. This is unprecedented in Cyprus. The Ministry has appointed a research officer on the grounds that the teacher/ artist has violated the ‘fundamental duties of a teacher’ under the Public Education Service Law on two counts: Article 48(d) stipulates that teachers are prohibited ‘from acting or omitting to act or behave in a manner that is likely to defame/discredit the educational service in general or his position in particular, or who may undermine public confidence in the education service’. Article 48(e) requires ‘proper behaviour towards the teacher’s superiors and colleagues and towards the public/community’. However, the Ministry failed to mention that this otherwise outdated law also safeguards the right to ‘freedom of expression’ in Article 51, which explicitly provides: “Teachers are free to express their views, either individually or in public, through speeches, lectures, announcements, studies or articles.” The teacher complained that he received masses of hate mail and messages and insults in his social media accounts following the Archbishop’s call for his dismissal. What is most encouraging, however, is the astonishing response from the democratic arc of society against the persecution of the teacher and artist. This is because it is a direct attack on the right to freedom of expression, art and science, but also on his labour rights. Several public institutions have expressed astonishment and dismay over the Ministry’s decision which they see as a direct attack on the freedom of expression, the academic/scientific and freedom of art. Statements were issued by the Senate of the University of Cyprus, the Art Teachers in secondary schools, the School of Fine Arts of the Cyprus University of Technology, the Cyprus Chamber of Fine Arts (EKATE), people of letters, culture and arts, with a collection of over 3 800 signatures in support of the teacher and artist. The Commissioner of Administration (Ombudswoman) in her capacity as National Independent Authority for Human Rights has issued a controversial public position paper attempting to justify the action taken against the teacher and artist as the result of overstepping the line of freedom of expression and art. The Commissioner noted that her position paper was issued for the purposes of ‘reflection on the protection of the totality of human rights, including the ‘right’ of art and its exponent’ and advised that the issue ‘be disconnected from the threat of any personal persecution’ (see here, Αρ. Φακ.: ΑΥΤ. 24/2020, Λευκωσία, 18 Σεπτεμβρίου 2020).
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Reading her position paper, this is hardly the case. Moreover, when asked about disciplinary action against the teacher by his employer, the Ministry of Education, she stated that she refused to take a position on this issue and that she did not know, and that this was up to the Ministry of Education (see the television interview on the TV channel alfa: ‘Συνέντευξη της Επιτρόπου Διοικήσεως στο κανάλι Άλφα’). The position paper cited cases from the ECtHR to find a balance between the freedom of expression, on the on hand (referring to case ECHR, 68354/10, 25 March 2007, Vereinigung Bildender Kunstler v Austria) and on the other, the obligation to respect the religions of others (referring to cases ECHR, 68354/10, 25 March 2007, Vereinigung Bildender Kunstler v Austria; ECHR, 14307/88, 25 May 1993, Kokkinakis v Greece; ECHR, 13470/87, 20 September 1995, Otto-Preminger-Institut v Austria; ECHR, 10737/84, 24 May 1988, Müller v Switzerland). She concluded that the teacher/ artist had violated the rights of others, the majority of who are Greek Orthodox and who felt offended by his paintings. The Commissioner failed to explain how these paintings were offensive and failed to weigh in her analysis of the artist’s own right to religion of belief (as provided in the Kokkinakis case). Most importantly, however, the Commissioner’s report failed to refer to the Charter of Fundamental Rights of the European Union, and in particular to Article 13, which explicitly safeguards the ‘Freedom of Art and Science’ by providing: “The arts and scientific research shall be free of constraint. Academic freedom shall be respected”. This right is primarily deduced from the right to freedom of thought and expression. However, it is becoming increasingly important in public debates, as Gabriel Toggenburg notes: “Article 13 will gain in relevance. In times where we witness authoritarian tendencies in some EU Member States, a fundamental right to freely engage in arts and science is needed. After all, the role of the arts and sciences goes beyond the scope of freedom of speech and the right to education and is very important for a vivid democracy.” (See here for Toggenburg, G. (2020) “The 13th of all EU-r rights: the freedom of arts and sciences and how the Charter contributes”, EUreka! A blog on all things EU, 7 September 2020). CJEU case law referring to this Article is beginning to emerge - as Advocate General Kokott stated in his opinion in case C-66/18, Commission v Hungary: “145. From a schematic point of view, academic freedom can be found in Article 13 of the Charter together with the protection of freedom of the arts, which, according to the case-law of the ECtHR, is also a manifestation of the freedom to hold opinions. It follows that academic freedom under the second sentence of Article 13 of the Charter can also be regarded as a fundamental right of communication. Academic freedom is not, however, restricted to mere communication. 146. Rather, the Charter, unlike the ECHR, contains a fundamental right to freedom of the arts and sciences which is autonomous of the general freedom to hold opinions. This includes not only substantively autonomous research and teaching that is free from State interference, but also its institutional and organisational framework. Affiliation with a State or private university is, in practice, an essential condition for academic research. The university serves as a platform for academic discourse and a network and infrastructure for teaching staff, students and donors. The freedom to found educational establishments enshrined in Article 14(3) of the Charter protects only part of that institutional framework, namely in so far as private educational establishments are concerned.”
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Numerous lawyers, human rights experts, and scholars and intellectuals in their intervention specifically cited Article 13 of the Charter, suggesting that the Ministry’s actions constitute a violation of this Article (see Pittas, I. (2020): ‘Οι αυτόκλητοι τροχονόμοι της ηθικής μας… και η τέχνη! Μιλούν στην «Κυριακάτικη Χαραυγή‘ οι Α. Δημητρίου, Δ. Χριστόπουλος και Α. Γραμματικόπουλος», Χαραυγή, 26 September 2020). Another former MP, who criticised the Ministry’s actions, compared the case to Charlie Hebdo (Katseli, R. (2020): ‚Θυμίζει Charlie Hebdo‘, Φιλελεύθερος, 20 September 2020). In her position paper and her public interventions, the Commissioner failed to refer to the Charter of Fundamental Rights of the European Union. Moreover, the fact that she places in quotation marks the word ‘right’ (to art) in the final paragraph of her position paper legitimately raised the question whether the Commissioner’s disregard of the Charter is due to a lack of awareness of Article 13 of the Charter, or whether it amounts to a direct questioning of the specific provision; also, the Commissioner failed to act as an independent and unbiased body that operates as a watchdog of human rights (see Trimikliniotis, N. (2020): ‘Η σκοταδιστική δίκη του Υπουργείου Παιδείας, μια διάτρητη γνωμάτευση και η νομική αλχημεία: Η ανάγκη για δημοκρατική αντίσταση στη μεσαιωνική αυθαιρεσία‘, Κράτος Δικαίου, 27 September 2020). As noted, the failure to take the Charter into account is a failure to appreciate that since the Treaty of Lisbon, the EU Charter of Fundamental Rights has acquired equal legal value as other treaties, and is considered to be primary EU law that is legally binding for the EU institutions and the Member States, and can be implemented before the Court of Justice (ECJ) when EU law is at stake. The Commissioner in her position paper claimed that rights under the Charter must be restricted, disregarding the teacher/ artist’s rights as an employee. This, however, automatically triggers the process where the CJEU can and should consider that it has jurisdiction, as it is EU law in relation to the rights safeguarded in the Charter (see case 260/89 ERT 1991 I-2925. see. Barnard, C. (2012) EU Employment Law, Fourth Edition, Oxford University Press). In this sense, EU law applies to the teacher’s individual civil rights as well as his employment rights, both outside and during work. In the case of Mr. Gabriel, the rights of the Charter mentioned above are affected. These rights are binding for the Member States. As regards the right of assembly and association (Article 12, ECHR), the WEU has ruled that the ECHR’s decision is binding, even though the TFEU explicitly precludes the Union from legislating on these matters. The same applies to the rights in Articles 10, 11 and 12. In Cypriot law, G. Gabriel as a teacher of secondary education is a carrier of rights and obligations regulated by Cypriot Administrative Law, Constitutional law, general human rights and labour rights, which derive from European law, such as the EU Directives against discrimination. It is highly questionable whether the Ministry is allowed in law to discipline Mr. Gabriel for his artistic creations which he paints in his free time, and which are rights protected by national law, EU law, and international conventions. It is likely that the disciplinary action initiated against Mr. Gabriel is unlawful, unconstitutional and a violation of EU law and international conventions, such as the ECHR, and breaches fundamental rights provided for in the Charter.
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Czech Republic
Summary (I) Due to the COVID-19 crisis, the Czech Republic has introduced restrictions on the operation of businesses and other establishments. (II) The government adopted a partial unemployment support scheme for employees who cannot work during economic crises (“kurzarbeit”). (III) A government regulation increasing and valorising pensions for 2021 has been published and will enter into effect on 1 January 2021. (IV) A government regulation raising the maximum amount of contribution provided to support the employment of persons with disabilities has been published and entered into effect on 01 October 2020. ______National Legislation 1.1 Measures to respond to the COVID-19 crisis 1.1.1 Travel ban The extraordinary measure of the Ministry of Health No. MZDR 20599/2020- 30/MIN/KAN of 18 September 2020 has been adopted with effect as of 21 September 2020. The text of the extraordinary measure is available here. The list of low-risk countries is available here. With effect as of 21 September 2020, all persons entering the territory of the Czech Republic who exhibit any symptoms indicating the COVID-19 disease have the obligation to report to a physician (general practitioner). They must also be willing to subject themselves to inspection for symptoms when crossing the border (and to cooperate with medical staff, if any symptoms are detected). All persons entering the Czech Republic who stayed in a country not listed as a low- risk country for more than 12 hours within the past 14 days have the obligation to immediately notify a competent hygiene station using a specific form, to submit the confirmation of notification, and to get tested for COVID-19 at their own expense (unless public health authorities adopt other measures) within 5 days of entry into the Czech Republic. If the hygiene station is not presented with the result of the COVID- 19 test within 7 days of entry into the Czech Republic, it will decide appropriate quarantine measures. Third-country (non-EU) citizens of countries not listed as low-risk countries are banned from entering the Czech Republic, unless they fall under one of the exceptions exhaustively listed in the Protective Measure, i.e.: foreign nationals with long-term or permanent residence in a low-risk country; holders of valid long-term visas, or long-term temporary, or permanent residence permits in the Czech Republic issued by the Czech Republic; foreigners who were issued a short-term visa by the Czech Republic after 11 May 2020; foreign nationals with long-term or permanent residence permits in the EU, transiting through the Czech Republic (for no more than 12 hours); family members of Czech or EU citizens residing in the Czech Republic;
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other exceptional situations (public interest, workers in international transport, etc.). Entities who receive third-country (non-EU) nationals for the purpose of economic activity or education in the territory of the Czech Republic (such as user undertakings) after 01 July 2020 must: ensure that such a foreign national has accommodation in the Czech Republic (for the duration of his or her stay, including the duration of potential quarantine measure) – unless the foreign national’s accommodation is ensured otherwise; ensure medical care to the foreign national (for the duration of his or her stay) – if the medical care is not covered by insurance and is not paid by the foreign national, the receiving entity is required to pay the costs; ensure the return of the foreign national to the country of origin (when the purpose of the foreign national’s stay ends). The above obligations do not necessarily need to be realised by the receiving entity itself (e.g. the worker can find and pay for his or her own accommodation) – the receiving entity is only liable in case said obligations are not fulfilled. Employers and user undertakings must ensure that the following persons cannot enter their workplaces (establishments) without presenting a negative COVID-19 test result: citizens of countries not listed as low-risk countries; citizens of low-risk countries who stayed in the territory of a country not listed as a low-risk country for more than 12 hours within the past 14 days. All persons who stayed in the territory of a country not listed as a low-risk country for more than 12 hours in the 14 days preceding their entry into the territory of the Czech Republic have the obligation to wear protective respiratory equipment (facemasks, scarves, respirators, etc.) for the duration of their stay in the territory of the Czech Republic, for 10 days, or for the duration of the relevant quarantine measure. All persons who stayed in the territory of a country not listed as a low-risk country for more than 12 hours within the past 14 days are prohibited from moving freely in the territory of the Czech Republic and must stay in their place of residence in the Czech Republic – with the following exceptions: commuting to work and movement within the scope of performance of work (and similar activities) – with certain exceptions; necessary errands (to fulfil basic needs); visits of medical and social services facilities; official administrative errands; travels back to the place of residence; attendance at funerals. The above restrictions do not apply with regard to children under the age of 5 years.
1.1.2 Restrictions of mass events The extraordinary measure of the Ministry of Health No. MZDR 20588/2020- 17/MIN/KAN of 23 September 2020 has been adopted with effect as of 24 September 2020 until 07 October 2020. The text of the extraordinary measure is available here.
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With effect as of 24 September 2020 until 07 October 2020, the extraordinary measure prohibits or restricts theatre, music, film, and other art events, sporting, cultural, religious, dancing, tradition or similar events, or other assemblies, public and private alike, where outside attendance exceeds 1 000 persons or where inside attendance exceeds 500 persons – with certain exhaustively listed exceptions. During events where outside attendance exceeds 50 persons or where inside attendance exceeds 10 persons, the participants must maintain a distance from others of at least 2 metres.
1.1.3 Obligation to wear respiratory protective equipment The extraordinary measure of the Ministry of Health No. MZDR 15757/2020- 35/MIN/KAN of 17 September 2020 has been adopted with effect as of 18 September 2020. The text of the extraordinary measure is available here. With effect as of 18 September 2020 until further notice, the Ministry of Health has re- issued an order by which movement and stay is banned for all people not wearing protective face equipment (such as respirators, drapes, face masks, headscarves, etc.) in the following spaces: all indoor spaces of buildings (outside of place of residence); inside public transportation. The extraordinary measure continues to list a number of exceptions from the above rule – e.g. employees working statically in one area (if maintaining a distance of 2 metres from other persons).
1.1.4 Restrictions to the operation of businesses and other establishments The extraordinary measure of the Ministry of Health No. MZDR 20581/2020- 11/MIN/KAN of 23 September 2020 has been adopted with effect from 24 September 2020 until 7 October 2020. The text of the extraordinary measure is available here. With effect from 24 September 2020 until 07 October 2020, the extraordinary measure introduces restrictions on the operation of establishments for the provision of goods and services (generally businesses) – such establishments must adhere to the following rules: to ensure (by means of providing information materials) that the customers keep a distance of at least 2 metres from one another, and that they preferably use cards to pay; to provide disinfectants to customers and employees close to regularly touched items; to make the rules above known by means of information materials. The extraordinary measure further proceeds to list rules that apply with regard to specific establishments (restaurants and cafes, saunas, hairdressers, gyms, etc.) – e.g. restaurants and similar establishments must be closed to the public between 22:00 and 6:00.
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1.1.5 Partial unemployment benefits The Draft Act amending Act No. 435/2004 Coll. on Employment, as amended, and other related legislation has been approved by the government and will be submitted to Parliament (the House of Deputies). The proposed text of the Draft Act is available here. The Draft Act was already reported on in the August 2020 Flash Report– the present issue reflects some of the most recent developments. As already reported (see August 2020 Flash Report), the Draft Act introduces so-called ‘support during partial unemployment’ – the support essentially consists of the State providing monetary assistance to employees to whom their employer cannot assign work (i.e. furloughed employees) for various reasons (drop in demand for goods and services, lack of raw materials, etc.). The state monetary assistance is provided instead of compensation of salary, which the employer would have to pay to furloughed employees under normal circumstances (i.e. without the regime being activated). The regime of support during partial unemployment is to be activated by government regulation when the economy is at risk (due to e.g. a pandemic, cyberattack, natural catastrophe, etc.). The support is to only be provided to employees who are furloughed in direct connection with the reasons for which the regime of support during partial unemployment is activated, if the employer does not assign work to the employees to the extent of at least 20 per cent and at most 80 per cent of their weekly working hours. The support is to be provided in the amount of 70 per cent of the employee’s hourly net earnings – it cannot, however, exceed the maximum amount of the average monthly salary in the national economy calculated for the first and third quarter of the average year. Support during partial unemployment is not provided in the following cases: If the employee is not employed for an indefinite period with the employer for at least 3 months; If the employee has an account of working hours (special working hours arrangement); If the employee is entitled to compensation of salary for the relevant period due to quarantine or temporary incapacity for work, or is entitled to sickness insurance benefits. The support period is set to a maximum of 12 months. The Draft Act is supposed to enter into effect on 01 November 2020.
1.2 Other legislative developments 1.2.1 Pensions Government Regulation No. 381/2020 Coll. on the amount of the general assessment basis for 2019, the recalculation coefficient for the amendment of general assessment basis for 2019, the reduction limit for the determination of the calculation basis for 2021 and the basic assessment for pensions for 2021 and an increase in pensions in 2021, has been published and will enter into effect on 01 January 2021. The text of the resolution is available here. The government has set new parameters for the calculation of pensions (old-age, invalidity, widow, widower, and orphan pensions) in 2021. The general assessment
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basis for 2019 rose to CZK 34 766 (i.e. approx. EUR 1 279). The recalculation rate for its adjustment for 2019 is 1.0194. The first reduction limit determining the calculation basis in 2021 will be CZK 15 595 (i.e. approx. EUR 574) and the second reduction limit will be CZK 141 764 (i.e. approx. EUR 5 217). The amount of the basic assessment of the above-mentioned pensions (i.e. the amount of old-age, invalidity, widow’s, widower’s and orphan’s pension, which belongs to all recipients at the same amount, regardless of income) will rise to CZK 3 550 (i.e. approx. EUR 131) per month. In addition, the basic assessment of pensions granted before 1 January 2020 will increase by CZK 60 (i.e. approx. EUR 2) per month and the percentage assessment of such pensions will increase by 7.1 per cent.
1.2.2 Subsidies for the employment of persons with disabilities Government Regulation No. 388/2020 Coll., on the maximum amount of contribution to support the employment of persons with disabilities on the protected labour market, has been published and entered into effect on 1 October 2020. The text of the resolution is available here. The State (through the Labour Office) provides employers who employ persons with disabilities with a financial contribution based on an agreement concluded with them (under certain conditions set by legislation). The Government Regulation raises the maximum amount of contribution to CZK 13 600 (i.e. approx. EUR 500).
2 Court Rulings Nothing to report.
3 Implications of CJEU Rulings and ECHR 3.1 Transfer of undertaking CJEU joined cases C-674/18 and C-675/18, 9 September 2020, TMD Friction The present CJEU ruling has no significant implications for national law. The ruling, to a large degree, is not applicable to the conditions in the Czech Republic – in the Czech Republic, there are no occupational pension schemes, only a public pension scheme (supplemented by private schemes, with payments being made to funds based on contracts with special insurance institutions and where supplementary pensions are provided under agreed conditions).
4 Other Relevant Information Nothing to report.
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Denmark
Summary A new tripartite agreement grants parental benefits to workers who stay home from work because their children have contracted or must be tested for COVID-19. ______1 National Legislation 1.1 Measures to respond to the COVID-19 crisis 1.1.1 COVID-19 update Denmark has witnessed a resurgence of COVID-19 infections at the beginning of August, which has delayed the last phase of the re-opening of society, and has led to new restrictions. The virus is currently primarily spreading at social events, such as weddings and birthday parties; all age groups are affected, and in particular, young adults are now getting infected. As of 19 September 2020, restaurants, bars and cafés are only allowed to remain open until 10 p.m., large gatherings were reduced from 100 to 50 people, and face masks are now mandatory in all public transport, when standing up in restaurants, bars, cafes, and at hospitals, dentists, etc. Both public and private employers are encouraged to let employees work from home to the extent possible and to cancel all social events. The new measures ran until 4 October 2020, but have now been extended until 18 October. In the last week of September, new guidelines were issued to increase the use of facemasks among all health and care staff, particularly for the elderly, free flu vaccines, and a call for cancellation of all social events at schools, secondary and tertiary education. Likewise, the current exception from the 2 meter rule for tertiary education students in classrooms and auditoriums has been lifted, and the same restrictions apply to physical teaching situations as to other gatherings (see further details on the new measures in the links below). The paper on the new measures of the Ministry of Health of 18 September 2020 is available here. More news from the Danish Health Authority is available here.
1.1.2 Special care leave A new Tripartite Agreement between the government, the Danish Confederation of Trade Unions (FH) and the Danish Employers’ Confederation (DA) aims to support parents who must stay home from work to take care of their children (below the age of 14). The press release is available here. A child may have to be absent from school or day care due to infection the with COVID-19 virus or due to other children or staff being infected, which may require testing of the child. According to Danish employment law, an employee’s absence from work to take care of a sick child does not amount to justified leave unless it is due to accidents or similar. The parent may not receive pay during leave due to a child’s sickness. In many collective bargaining agreements and individual contracts, however, an employee is granted leave with full pay for the child’s first and sometimes second day of sickness. Due to the COVID-19 situation, where obtaining testing results may take up to one week, the existing rules on absence from work present a challenge for many families.
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According to the new subsidised scheme, parents may receive State financed parental leave benefits when a child is sent home from day care/school due to a COVID-19 outbreak, until the child has been tested and may return to school or day care facility. The scheme will apply until 31 December 2020. Parents must meet the requirements set out in the Parental Leave Act (Parental Leave Act, No. 106 of 2 February 2020), and must be unable to work from home, take time off in lieu, etc. The scheme covers both employees and self-employed workers.
1.2 Other legislative developments Nothing to report.
2 Court Rulings Nothing to report.
3 Implications of CJEU Rulings 3.1 Transfer of undertakings CJEU joined cases C-674/18 and C-675/18, 9 September 2020, TMD Friction The ruling does not have implications for Danish law. The situation dealt with in the present case cannot arise in the Danish context due to the difference in occupational pension schemes. In Denmark, three occupational pension schemes exist: Collective agreement-based pensions (trade unions and employers’ associations/individual employers decide on a pension scheme, including on the level of employer and employee contributions, the pension payments are made to an external pension company, often a member-owned pension fund. The employer does not pay the actual pension to the retired employees, the pension fund pays the pensions); Company-based pension (a pension scheme agreed to between an individual employer and a commercial/independent pension company, with employer and employee contributions. The payments are accrued by the external pension fund, and the employer has no access or right over the contributions to the pension fund. The pension fund, not the employer, pays out the pension to the employee upon retirement); Civil servant pension (regulated by the Act on Civil Servant Pensions and funded by the State budget). The employer is obligated to make payments to the relevant pension fund/company in accordance with the employment contract or the collective agreement. Any payment of pension benefits to an employee who retires or otherwise wishes to take out his/her pension funds is of no relevance to the employer, but is a matter entirely between the employee and the pension fund / pension company.
Duty to continue making contributions: As pension contributions are considered part of the employee’s salary, a transferee must continue making contributions to a pension scheme for the transferred employees, based on obligations either in the collective agreement or individual employment contract. The transferee must also make any outstanding contributions
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from the period before the transfer, as these are rights and duties of the transferred employees that existed at the time of transfer. Depending on the terms of the pension schemes in question, the employer may continue to make payments to the same pension fund (this rarely happens), the employer may make contributions to a new pension fund organised to the benefit of the transferred employees or may make the contributions to a pension fund under an existing agreement already in force at the transferee. Also, new contributions become the ownership of the transferred employees, and are a matter between the pension fund and the employee upon retirement.
Right of ownership of deposited and accrued pensions: Neither the transferee nor the transferor have any right of ownership or any involvement with the accrued pension savings in any pension funds, neither at the time of transfer nor at a later time. The accrued contributions are owned by the employee and is a matter entirely between the pension fund and the employee.
Rare exceptions: pension payments directly from the employer to the employee The exception to subrogation of the rights in Section 2(3) of the Danish Act on Transfers of Undertakings implementing Article 3(3) of the Directive, is understood on the basis of this well-established starting point about occupational pension contributions. The duty of the transferee to continue to make pension contributions on behalf of the transferred employees is not addressed by the provision. The provision is understood as stating the obvious, that the transferee does not subrogate in a duty to pay out old-age retirement or disability pensions, as these pensions are protected in other sources of law. The exception in Section 2(3) only applies to agreements by which the employer is obligated to pay supplementary pension payments directly to the employee upon the employee’s retirement or disability. This exception is provided as the public old-age retirement pension scheme and the public disability pension scheme are protected in other sources of law. A duty of the former employer to pay out the pension was considered in Supreme Court case U 2005.3081 H. In that case, an employee was transferred from employer A to a new employer B. Upon retiring from employer B, the transferred employee was no longer considered eligible for additional pension payments from the private supplementary pension fund of employer A, established as a staff fringe benefit to employees of employer A, and applicable only to employees who were employed with employer A upon retirement. The pension fund was found to not be obligated to pay out the supplementary pension payments to the transferred employee, as the employee did not meet the terms for eligibility – i.e. retiring from employer A. As a caveat, the claim was brought against the pension fund of employer A, not against that of employer B, the transferee. The ruling is in line with the principle of Section 2(3).
Transfer from insolvent or bankrupt transferors: The Danish Act on Transfers of Undertakings also applies to transfers from employers facing insolvency and bankruptcy. In that case, the date of the bankruptcy decree is the demarcation line for any duties the transferee adopts. Any outstanding pension contributions from this date of the transferor is not adopted by the transferee, but will instead be paid out by Lønmodtagernes Garantifond/LG (salary guarantee fund for employees), which is the Danish equivalent of PSV. The LG provides a guarantee for any outstanding payments to the employee’s pension fund in case of employer insolvency. According to the LG Act, Section 2(1), “the guarantee covers claims for salaries and other elements of remuneration”. Other benefits include an employer’s
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contributions to a pension fund. This is established in case law, e.g. in Eastern High Court ruling of 19 December 2013 (UfR 2014.1062 Ø), where LG was ordered to cover both the employer’s and the employee’s part of the pension contributions and transfer the payment to a pension company. In case of insolvency or bankruptcy, any accrued pension savings deposited with pension funds continue to belong to the employee, and do not become part of the estate or part of the transfer. Thus, in case of a transfer of undertaking that is subject to bankruptcy proceedings, an employee’s entitlement to public old-age benefits or to an occupational old-age retirement pension will not be compromised, as established in Article 8 of Directive 2008/94.
4 Other Relevant Information Nothing to report.
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Estonia
Summary The social partners have agreed to maintain the current minimum wage for 2021. ______1 National Legislation Nothing to report.
2 Court Rulings Nothing to report.
3 Implications of CJEU Rulings 3.1 Transfer of undertaking CJEU joined cases C-674/18 and C-675/18, 9 September 2020, TMD Friction The cases concerned transfers of undertakings and the protection of employees’ rights. The main issue was connected with the employees’ pension rights in cases of transfers of undertakings and whether a transfer affects employees’ supplementary pension rights. In Estonia, there are no pension schemes that are operated or guaranteed by employers. In this sense, the implications of the case are modest. The ECJ again elaborated the characteristics of a transfer of undertaking in case of employer insolvency. The criteria the ECJ emphasised are also important for Estonian labour law. According to Estonia’s corresponding legislation, the rules on transfers of undertakings are not applied in case of an employer’s declaration of bankruptcy, i.e. when the court has ordered the employer’s insolvency. This problem has also been dealt with in Estonian legal literature. In Estonia, there is no difference whether the aim of the insolvency is liquidation of an enterprise or to continue the enterprise’s activity to a certain extent. In this sense, there is no need to amend Estonian labour legislation to bring it in line with the ECJ’s case law.
4 Other Relevant Information 4.1 Minimum wage proposal by the social partners The Estonian Employers’ Association and the Estonian Trade Unions Confederation have proposed to not change the monthly minimum wage next year. According to the 2019 agreement, which is still valid, it was agreed, that the monthly minimum wage will be increased by 2021 to guarantee that the monthly minimum wage will be at least 40 per cent of the average wage. The increase of the monthly minimum wage is bound to economic growth. As pointed out by the Ministry of Finance, the economic growth this year will be negative. Therefore, it is reasonable to maintain the monthly minimum wage at this year’s level.
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Finland
Summary (I) The Government Proposal for the implementation of the Posted Workers Directive was approved by Parliament with amendments. (II) The Supreme Court issued a judgment on the employer’s right to terminate an employment contract due to a crime that had been committed during the employee’s leisure time. (III) The Labour Court issued a judgment on the payment of sick leave during paid annual leave, and a judgment sanctioning industrial actions organised by a trade union. ______1 National Legislation 1.1 Measures to respond to the COVID-19 crisis Nothing to report.
1.2 Other legislative developments 1.2.1 Posting of workers Parliament approved the Government Proposal (Government Proposal No. 71/2020) with amendments for the implementation of the renewed Posted Workers Directive (EU) 2018/957, which was submitted to Parliament in May. In the Proposal, the government proposed the amendments to the Posted Workers Act to enter into force on 30 July 2020.
2 Court Rulings 2.1 Termination of employment Supreme Court, KKO 2020:74, 30 September 2020 A city employee was convicted (with a suspended sentence) of severe embezzlement during leisure time in a position of trust in a trade union. The Supreme Court held that this was such a serious breach of the employment relationship that the employer could not be reasonably expected to continue the contractual relationship with that employee. The employer thus had no obligation to find a different post for the employee because of dismissal.
2.2 Paid annual leave, sick leave Labour Court, TT 2020:82, 28 September 2020 An employee had been granted annual leave for a week following request for leave. When no annual leave is granted, the work and payment of salary is considered to be interrupted for the period in question on the basis of the employment contract. After employee’s annual leave was granted, but before it started, the employee slipped on the way to work and took sick leave, which continued for the entire period of granted annual leave. Despite the employee’s request, the annual leave days were not transferred. The employee was paid the annual leave wage for the duration of the initial annual leave period, i.e. for the week in question.
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The Labour Court held that the employee had the right to transfer the granted annual leave days on the basis of the collective agreement for public servants. The Court held that the employee did not have the right to sick pay during the period of granted annual leave, regardless whether the annual leave was retroactively transferred to another time or not.
2.3 Collective action Labour Court, TT 2020:79, 21 September 2020 Industrial actions were organised by a trade union to pressure the employer to conclude a new collective agreement that would have met the objectives of the employees. The purpose was to remove the so-called “kiky hours” (working time extension related to the Competitiveness Pact), which weakened the terms of employment. The industrial actions targeted clauses in the collective agreement that related to “kiky hours” and trade unions’ membership fee collection. The trade union admitted that it had breached its labour peace obligation and a compensation fine was imposed.
3 Implications of CJEU Rulings 3.1 Transfer of undertaking CJEU joined cases C-674/18 and C-675/18, 9 September 2020, TMD Friction The CJEU judgment concerned a transferee’s scope of responsibility for the supplementary pension benefits of the employees of an undertaking that had been transferred from an insolvent transferor. The Act on Safeguarding Direct Pension Promises in the Event of Employer Insolvency (209/2015), which transposes Directive 2008/94/EC, regulates the employer’s duty to safeguard at least half of the employees’ supplementary pensions corresponding directly to the amount of supplementary pension arranged for in case of the employer's bankruptcy or a company restructuring. Compliance with this Act is monitored by the occupational safety and health authorities on the basis of an inspection request from an employee or other beneficiary.
4 Other Relevant Information 4.1 Proposal to address abuse of foreign workers The Action Plan to fight the grey economy and economic crime was supplemented on 10 September 2020 with four new measures that support the fight against abuse of foreign workers. These new projects are: exchange of information and analysis of blind spots or shadow areas in cooperation between authorities monitoring immigration; implementing measures to prevent the abuse of foreign workers in different countries; introducing prerequisites for authorities who process work-based residence permits to recognise potential abuse; and development of analysis and new policy models to reflect the needs of multiple authorities that collaborate with one another.
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France
Summary (I) France now recognises COVID-19 as an occupational disease. (II) The Court of Cassation has ruled on dismissal and on notice of dismissal. ______1 National Legislation 1.1 Measures to respond to the COVID-19 crisis 1.1.1 Occupational diseases France recognises COVID-19 as an occupational disease. Decree No. 2020-1131 of 14 September 2020 creates two new tables of occupational diseases for those insured under the general and agricultural schemes, and for those insured to whom these tables apply. The recognition of COVID-19 as an occupational disease can be "automatic" for certain categories of workers and requires the application of a complementary procedure for others. A disease is presumed to be work-related when it is designated as such in a table of occupational diseases and contracted under the conditions mentioned in this table (Article L. 461-1 of the Social Security Code). In this context, a table of occupational diseases related to COVID-19 "Severe acute respiratory syndrome linked to an SARS-COV2 infection" (No. 100 for the general scheme, No. 60 for the agricultural scheme) has officially been instituted by the Decree of 14 September 2020 on the recognition of pathologies linked to the SARS- CoV2 infection as occupational diseases. It applies to health care sector workers (health care staff but also non-health care staff). Such staff can now benefit from an "automatic" recognition of an occupational disease if they meet the conditions set out in the table, namely: (1) The contracting of COVID-19 is confirmed by a biological examination or scanner or, failing that, by a documented clinical history; (2) the disease has resulted in an acute respiratory illness requiring oxygen therapy or other ventilator assistance or resulted in death; (3) the duration for managing the disease, i.e. the maximum period of time between the end of exposure to the risk and the first medical finding of the disease must be 14 days.
For workers who do not meet the conditions specified in the table (e.g. employees outside the health sector), a specific additional procedure must be followed. Thus, recognition of the existence of an occupational disease of pathologies linked to COVID- 19 is established by the General Director of the National Health Insurance Fund (CNAM) and a unique regional committee for the recognition of occupational diseases, dedicated to COVID-19-related diseases is informed to harmonise the processing of requests.
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1.2 Other legislative developments Nothing to report.
2 Court Rulings 2.1 Dismissal Labour Division of the Court of Cassation, No. 18-20.489, 9 September 2020 In the present case, an employee and his employer disagreed on several points, in particular on the content of electronic messages written by the employee, the content of which had motivated the employee's dismissal. These messages included insulting remarks about colleagues and criticism of the employer, thus, according to the latter, the employee had breached his duty of loyalty. Dismissed for serious misconduct, the employee had brought an action before the labour court to contest the termination of his employment contract considering that the messages motivating the disciplinary proceedings brought against him were private and had been irregularly obtained by his employer. They could therefore not be used to justify his dismissal.
The Court of Appeal validated the dismissal, considering that the various messages produced (from e-mails and instant messaging) were professional in nature and the employer had regularly read them.
The Court of Cassation confirmed this reasoning.
It should be recalled that a message sent or received from the workstation, i.e. from the professional messaging system made available by the employer, is of a professional nature, except where personal information is mentioned (cass. soc. 2 October 2001, No. 99-42.942; cass. soc. 26 June 2012, No. 11-15.310). Consequently, if e-mails are not identified as personal and are in the professional mailbox, they may be opened by the employer (cass. soc. 18 October 2011, No. 10- 26.782).
In the present case, the Court of Cassation confirmed that
"the disputed electronic messages, exchanged using the computer tool made available to the employee by the employer for the purposes of his work, came from a professional electronic mailbox and that they had not been identified as personal, which meant that the employer could take cognisance of them".
The employee argued that even if not identified as personal, e-mail messages may have private content, in which case they are covered by the right to privacy and the secrecy of correspondents. With some exceptions, they cannot be used by the employer as evidence before the court and therefore do not justify dismissal (cass. soc. 18 October 2011, No. 10-25.706).
The Court also dismissed this argument because the messages, exchanged between the former employee with a colleague, automatically transferred to the employee's assistant along with her colleagues, contained insulting and degrading remarks about other colleagues and a lot of criticism of the company's organisation, strategy and methods. Accordingly, they were deemed to be related to the employee’s professional activity and were therefore not of a private nature. "Réponse de la Cour
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6. D'abord, la cour d'appel a constaté que les messages électroniques litigieux, échangés à l'aide de l'outil informatique mis à la disposition du salarié par l'employeur pour les besoins de son travail, provenaient d'une boîte à lettre électronique professionnelle et a fait ressortir qu'ils n'avaient pas été identifiés comme personnels, ce dont il résultait que l'employeur pouvait en prendre connaissance.
7. Ensuite, la cour d'appel a constaté, par motifs propres et adoptés, que les messages échangés avec une collègue, automatiquement transférés à l'assistante du salarié avec l'accord de ce dernier, comportaient d'une part des propos insultants et dégradants envers des supérieurs et subordonnés, et d'autre part de nombreuses critiques sur l'organisation, la stratégie et les méthodes de l'entreprise. Ayant retenu que ces messages, qui étaient en rapport avec l’activité professionnelle, ne revêtaient pas un caractère privé, elle a ainsi fait ressortir qu'ils pouvaient être invoqués au soutien d'une procédure disciplinaire contre le salarié dont elle a relevé le comportement déloyal.
8. Le moyen n'est donc pas fondé."
2.2 Notice of dismissal Labour Division of the Court of Cassation, No.18-25.943, 16 September 2020 An employee challenged her dismissal for gross misconduct before the Employment Tribunal. The employee successfully appealed her case, with the court finding the dismissal to be devoid of any real and serious cause, maintaining that although the claim against the employee may constitute a mistake, the facts of the case do not indicate that the employee’s actions were committed with the intent to harm – an essential component of claims of gross negligence. The Court of Appeal thus dismissed the real and serious cause of the dismissal and a fortiori, the employee’s serious misconduct on the grounds that her intention was to harm the employer was not established. The court’s ruling was overturned and annulled by the Court of Cassation, which recalled that "in case of a disciplinary dismissal, if the letter of dismissal sets the limits of the dispute for the grievances raised against the employee and the consequence the employer intends to draw from this with regard to the terms of termination, it is up to the judge to qualify the facts invoked". The court did not specify whether the facts alleged against the employee constituted serious misconduct or misconduct of such a nature as to confer a real and serious cause for dismissal or not, i.e. the Court of Appeal did not provide a legal basis for its decision. This solution is in accordance with previous case law (cass. soc., 6 March 2019, No. 17-20.275 ; cass. soc., 20 February 2019, No. 17-26.532 ; cass. soc., 22 October 2008, No. 07-41.792 and 07-42.020). "Réponse de la Cour Vu les articles L. 1232-1, L. 1235-3, L. 1234-1 et L. 1234-9 du code du travail : 4.S’agissant d’un licenciement prononcé à titre disciplinaire, si la lettre de licenciement fixe les limites du litige en ce qui concerne les griefs articulés à l’encontre du salarié et les conséquences que l’employeur entend en tirer quant aux modalités de rupture, il appartient au juge de qualifier les faits invoqués
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5. Pour dire le licenciement de la salariée sans cause réelle et sérieuse, la cour d’appel relève, s’agissant du grief relatif au non-encaissement des chèques correspondant aux droits d’emplacements de la braderie de juin 2004, que le fait de ne pas présenter cent trente-cinq chèques à la date convenue a entraîné un retard de trésorerie préjudiciable à l’association, ainsi qu’un préjudice d’image auprès des émetteurs de ces chèques qui ont été débités près de trois mois après la date prévue et ont dû s’assurer que le solde de leur compte bancaire permettait ce règlement ; que si ces faits peuvent constituer des fautes, il ne ressort pas des éléments du dossier qu’ils caractérisent l’intention de nuire reprochée à la salariée pour fonder la décision de licenciement. 6. En se déterminant ainsi, sans rechercher si les faits ainsi reprochés à la salariée n’étaient pas constitutifs d’une faute grave ou d’une faute de nature à conférer une cause réelle et sérieuse au licenciement, la cour d’appel n’a pas donné de base légale à sa décision."
3 Implications of CJEU Rulings 3.1 Transfer of undertaking CJEU joined cases C-674/18 and C-675/18, 9 September 2020, TMD Friction According to national law, Article L. 913-2 of the Social Security Code provides that no provision leading to the loss of acquired rights to retirement benefits (or in the process of acquiring such rights), including the reversion of employees or former employees in the event of employer insolvency or the transfer of an undertaking, the establishment or part of an establishment to another employer, resulting from a contractual transfer or merger, may be inserted, on pain of nullity, in the agreements, arrangements or decisions referred to in Article L. 911-1. Article L. 913-2 of the Social Security Code transposes the provisions of article 3 of Council Directive 77/187/EEC of 14 February 1977 on the approximation of the laws of the Member States into the French Social Security Code, relating to the safeguarding of employees' rights in the event of transfers of undertakings, businesses or parts of businesses and Article. 8 of Council Directive 80/987/EEC of 20 October 1980 on the approximation of the laws of the Member States relating to the protection of employees in the event of insolvency of their employer.
4 Other Relevant Information Nothing to report.
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Germany
Summary (I) The Federal Council has welcomed the planned regulations to strengthen occupational safety and improve working conditions in the meat industry, but in legal literature, the new regulation continues to be met with criticism. In any case, the Federal Government has made it clear that it does not plan to ban contracts for work or temporary agency work in other areas. (II) The parliamentary group Die Linke is calling for more security in the German Bundestag for crowd workers. (III) The Federal Labour Court has asked the CJEU for a preliminary ruling on paid annual leave. ______1 National Legislation 1.1 Measures to respond to the COVID-19 crisis Nothing to report.
1.2 Other legislative developments 1.2.1 Occupational safety and health The Federal Cabinet intends to ensure orderly and safe working conditions in the meat industry. To achieve this, the so so-called Occupational Safety and Health Control Law (‘Arbeitsschutzkontrollgesetz’) was tabled on 29 July 2020. The new law stipulates uniform nationwide rules for the inspection of workplaces and the accommodation of employees in other sectors as well. The law prohibits the use of external staff in the meat industry’s core activities. The slaughterhouse operator is responsible for all employees in the core business. So-called work contracts will be prohibited from 01 January 2021 and temporary work will be prohibited from 01 April 2021: slaughtering, cutting and meat processing may in future only be carried out by the owner’s own permanent staff (see also July 2020 Flash Report). The Federal Council (Bundesrat) has welcomed the planned regulations to strengthen occupational safety and improve working conditions in the meat industry, which the Federal Government had submitted to. In its statement, the Bundesrat proposed a number of additions to ensure even better protection for employees. In the legal literature, the planned new regulation continues to be met with criticism. A number of renowned legal scholars claim that a general prohibition of temporary work in meat companies is extremely problematic in light of Article 4 of the Temporary Agency Work Directive 2008/104/EC as well as the provisions of Article 56 TFEU and Article 49 TFEU (see Boemke/Düwell/Greiner/Hamann/Kalb/Kock/Mengel/Motz/Schüren/Thüsing/Wank: Das Verbot der Arbeitnehmerüberlassung in der Fleischwirtschaft, in: Neue Zeitschrift für Arbeitsrecht (NZA) 2020, p. 1160). In any case, the Federal Government recently clarified in a response to an inquiry from the German Bundestag that it does not intend to ban cross-sectoral contracts for work or temporary work similar to that being carried out in meat companies. The findings from these companies were industry-specific and could not be transferred across the board to other industries.
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2 Court Rulings 2.1 Paid annual leave Federal Labour Court, 9 AZR 266/20 (A), 29 September 2020 The Federal Labour Court has asked the CJEU for a preliminary ruling on the question of whether it is consistent with Article 7 of the Working Time Directive 2003/88/EC and Article 31(2) of the Charter of Fundamental Rights of the European Union if the entitlement to paid annual leave, which could not already be forfeited according to Section 7(3) of the Federal Holidays Act (‘Bundesurlaubsgesetz’) due to the employer’s failure to cooperate, is subject to the statute of limitations under Section 194(1) of the Civil Code. Section 7(3) reads as follows: “Leave must be granted and taken in the current calendar year. A carry-over of the leave to the next calendar year is only permitted if it is justified by urgent operational reasons or reasons related to the employee. In case of carryover, leave must be granted and taken in the first three months of the following calendar year. However, at the employee's request, partial leave taken in accordance with section 5(1)(a) shall be carried forward to the next calendar year.”
3 Implications of CJEU Rulings and ECHR 3.1 Transfer of undertaking CJEU joined cases C-674/18 and C-675/18, 9 September 2020, TMD Friction According to Art. 5(2)(a) of Directive 2001/23/EC, contrary to the transfer of rights and obligations specified in Article 3(1) of the Directive, the transferee does not have to be liable for supplementary pension benefits based on periods of employment performed prior to the opening of insolvency proceedings on the assets of the transferor. The prerequisite for this is an equivalent protection of the employees’ claims. According to German law, the so-called ‘Pensionssicherungsverein’ is the institution responsible for insolvency protection of company pension benefits in the event of employer insolvency. For various reasons, it can happen that the benefits of the ‘Pensionssicherungsverein’ are significantly lower in the event of insolvency than the pension claims the employees would have received from the seller. This is why the Federal Labour Court (3 AZR 878/16 (A), 3 AZR 139/17 (A), 16 October 2018) submitted various questions to the CJEU as to whether the German legal situation is compatible with Union law. It seems particularly significant in this case that the CJEU affirmed the question of whether Article 8 of Directive 2008/94/EC fulfils the requirements of the Court of Justice for a directly effective—and therefore, in terms of content—unconditional and sufficiently precise provision of the Directive. The Federal Labour Court explained the following in its reference for a preliminary ruling: “If it is affirmed, the Court’s case law on the—limited—liability of the business acquirer in insolvency could only be upheld for the part of the future company pension claim which is based on the employee’s length of service after the opening of the insolvency proceedings. The protection of employees required by Art. 3(4) of Directive 2001/23/EC or Art. 5(2) lit. a of Directive 2001/23/EC would be granted if the Pensionssicherungsverein had to stand in for a part of the plaintiff’s entitlement to a company pension on the basis of Art. 8 of Directive 2008/94/EC”. See: Federal Labour Court 3 AZR 878/16 (A), 16 October 2018, note 56.
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4 Other Relevant Information 4.1 Protection of crowd workers The parliamentary group Die Linke is calling for more security in the German Bundestag for people who earn their wages as self-employed persons via digital platform work. In a motion, the group criticised that so-called crowd workers lack central protection rights. In addition to a minimum wage, they therefore also call for the co-determination rights of crowd workers to be strengthened, for example, by amending the Works Constitution Act. Furthermore, according to the motion, a conciliation office should be set up in the near future to mediate in disputes between crowd workers and platforms.
4.2 Pay differences between Germans and foreigners According to the Federal Government, nearly 21 million German citizens were in full- time employment subject to social insurance contributions in December 2019. Around three million people were foreign nationals. With reference to data from the Federal Employment Agency, the government also stated that around three million people with a German nationality earned a gross wage in the lower wage group. This corresponds to a share of 16 per cent of all German full-time employees subject to social insurance contributions from the core group. Among persons with foreign citizenship, the figure was one million or 37 per cent.
4.3 Employees in a standard employment relationship According to the Federal Government, in 2018, some 26.2 million workers aged between 15 to 64 years were employed under a standard employment contract (excluding fixed-term contracts, part-time, mini-jobs or temporary work). This represents 77.7 per cent of all employees in this age group. With regard to the group of EU-15 foreigners, this applied to about 73 per cent of the employees, for 65 per cent of the group of other EU foreigners and for 60 per cent of the group of non-EU foreigners.
4.4 Significant increase in cabotage transports According to the Federal Government, the number of cabotage transports in Germany increased significantly in the period from 2011 to 2018. According to the government, the number of cabotage trips, i.e. the provision of transport services by companies not based in Germany, rose from 1.72 million trips in 2011 to 4.11 million trips in 2018. The number of fines imposed for cabotage violations also rose (2011: 294; 2019: 1,114). In contrast, the number of commercial road haulage companies in Germany declined significantly between 2010 and 2015 (2010: 49,676; 2015: 45,051).
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Greece
Summary A new measure provides for the payment of wages for workers who need to quarantine. ______1 National Legislation 1.1 Measures to respond to the COVID-19 crisis 1.1.1 Wage payments during quarantine Employers must pay an employee, who has any of the coronavirus symptoms recognised by the national public health organisations and is absent from work, his/her full remuneration during his/her absence, unless the business has suspended its operations under a state order. Pursuant to a recent provision, as of 1 September 2020, employees who need to quarantine for one or two weeks for preventative reasons, and who cannot telework, are entitled to pay during their absence. However, they will be required to cover half of the working hours, lost due to their absence, by working beyond their daily contractual hours, by one (1) hour per day on other working days, starting from the end of the employee's quarantine (Article 15 of Law 4722/2020). Until 31 December 2020 (previously 30 September 2020), employers may require employees to telework (work remotely) without having to agree to changes to their contract of employment.
1.2 Other legislative developments Nothing to report.
2 Court Rulings Nothing to report.
3 Implications of CJEU Ruling 3.1 Transfer of undertaking CJEU joined cases C-674/18 and C-675/18, 9 September 2020, TMD Friction The cases are of major significance and clarify the issue of employees’ rights in the event of a transfer of undertaking following insolvency proceedings. Greek law (Presidential Decree 178/2002) provides that the transferee may refuse to participate or continue participating in a private insurance agreement (including pension agreements). In this case, the acquired rights of employees shall be preserved. On the other hand, the pay-related entitlements of employees whose employer has become legally insolvent are protected by the fund for protection against employer insolvency, which is run by the OAED – Manpower Organism (Presidential Decree 1/1990). Employees may claim their entitlements from the OAED fund owed to them by their employer – notably, arrears of pay, holiday pay, pay in lieu of statutory notice
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and awards made under employment rights legislation. There is a limit of three months' pay for arrears. The decree (1/1990) also provides that employees’ acquired rights, having already left the employer’s undertaking or business on the date of the onset of the employer’s insolvency, provided in supplementary occupation schemes, shall be preserved. However, the fund does not guarantee any old-age benefits. It only provides that employees’ pension rights shall be taken into account in the framework of the liquidation of the pension scheme’s property. Greek law therefore does not seem to be in compliance with the ECJ ruling stating that “the transferee is not liable for an employee’s rights conferring prospective entitlement to that retirement pension where those rights have accrued with respect to periods of employment that preceded the opening of the insolvency proceedings, provided that, with respect to the portion of the amount for which the transferee is not liable, the measures adopted to protect the interests of the employees are at a level that is at least equivalent to the level of protection required under Article 8 of Directive 2008/94/EC of the European Parliament and of the Council of 22 October 2008 on the protection of employees in the event of the insolvency of their employer”, i.e. at least half of the old-age benefits. However, the ruling does not touch upon sensitive national matters, as only few supplementary occupation schemes exist.
4 Other Relevant Information Nothing to report.
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Hungary
Summary The Constitutional Court has rejected the complaint against Article 6(4) of Government Decree 47/2020 on derogations from labour law regulations. ______1 National Legislation Nothing to report.
2 Court Rulings 2.1 Derogations from labour law Constitutional Court, Decision No. 3326/2020, 5 August 2020 Government Decree No. 47/2020, which was in force from 19 March until 18 June 2020, stated: “6(4) The employer and the employee may derogate from the Labour Code by mutual agreement.” The analysis of this provision has been discussed in former Flash Reports and ad hoc reports and refers as the background for the new decision of the Constitutional Court. As for the history of decision, 52 Members of Parliament turned to the Constitutional Court to claim unconstitutionality of this provision. There is no information in the decision on the date of the complaint. The Constitutional Court rejected these complaints in Decision 3326/2020. (VIII. 5.) AB on 5 August for the following reasons: 1. There is no violation of obligations in international treaties (listed in the complaint): “[11] The international treaties referred to in the constitutional complaint do not have direct effect on the relationship between the employer and employee. The provisions of the referred international treaties have been implemented in the Labour Code and in other national laws. There is no direct connection between Article 6(4) and international treaties, and this argument was not mentioned in the complaint. The complaint, therefore, is not in line with the requirement of the relevant Hungarian law, thus, it must be rejected by the Constitutional Court based on Article 64 point d) of the Constitutional Court Act.” Act 151 of 2011 of the Constitutional Court is available here. 2. The Constitutional Court cannot state unconstitutionality of this provision (Art. 6.4 of Decree 46/2020) based on the violation of constitutional rights: “[23] The Constitutional Court, as a general rule, may investigate the constitutionality of existing legislation that is in force. [24] According to Article 64 point e) of the Constitutional Court Act, the Constitutional Court rejects the complaint in its decision, if the material investigation substantiates that the law is not in force, with exceptions in Article 25-27 of the Constitutional Court Act. Article 6(4) of the Government Decree, mentioned in the complaint, is no longer in force, therefore, it is not possible for the Constitutional Court to examine it in the course of its ex-post abstract norm control, and therefore, the Constitutional Court rejects the complaint.
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[25] The Constitutional Court finds it necessary to remark that in accordance with Article 41(3) of the Constitutional Court Act, the Constitutional Court can exceptionally examine the constitutionality of laws that are not in force, if the given law can be applied in practice after the date it no longer is in force. Even if Article 6(4) cannot be examined within the scope of an ex-post abstract norm control procedure, but the application of the provision to the relationship of an employee and an employer makes it possible, in practice, for the Constitutional Court to investigate the case, if the complainant can prove his/her personal involvement and the violation of fundamental constitutional rights in accordance with Article 26-27 of the Constitutional Court Act. At the same time, the application of the provision in practice to an individual case also makes it possible for the judge to submit an initiative to the Constitutional Court under Article 25 of the Constitutional Court Act, if the breach of a constitutional right emerges in relation to the application of the law, which is not in force.”
3 Implications of CJEU Rulings 3.1 Transfer of undertaking CJEU joined cases C-674/18 and C-675/18, 9 September 2020, TMD Friction Act 96 of 1993 on voluntary mutual insurance funds regulates employees’ pension rights deriving from voluntary pension schemes. Article 2 Subsection (3) point d) of this Act contains the definition, right to and rules of the individual account. However, the Act on voluntary mutual insurance funds does not contain any specific provision on the protection of employee rights in case of transfers of undertakings and particularly the case dealt with by the ECJ judgment. Therefore, Hungarian law does not provide specific protection against such risks.
4 Other Relevant Information Nothing to report.
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Iceland
Summary (i) A new act introduces changes to labour legislation in connection with COVID-19 with regard to unemployment benefits and wage payments in case of quarantine. (ii) Private sector collective agreements remain in force. ______1 National Legislation 1.1 Measures to respond to the COVID-19 crisis On 4 September, Act No. 112/2020, amending various Acts to Respond to Economic Repercussions due to the Coronavirus Pandemic, was passed. The Act extends the period of payments to employees in quarantine, as guaranteed in Act No. 24/2020, on Temporary Payments of Wages of Persons, who are quarantined without infection in accordance with the instructions of the health authorities until the end of 2021. Furthermore, it makes certain amendments to Act No. 54/2006, on unemployment insurance, which, inter alia, allows those receiving unemployment benefits to study at the university for one semester under certain conditions, extends the period of income-related unemployment benefits from three months to six months and extends the partial unemployment benefit scheme to the end of the year.
1.2 Other legislative developments Nothing to report.
2 Court Rulings Nothing to report.
3 Implications of CJEU Rulings 3.1 Transfer of undertakings CJEU joined cases C-674/18 and C-675/18, 9 September 2020, TMD Friction The ruling will not have direct implications for Icelandic law. The Icelandic pension system rests primarily on three pillars: a tax-financed public pension system, mandatory occupational pension funds, and supplementary voluntary pension fund savings. The latter two are financed from payments that are divided between the employer and employee, and are deducted from the employee’s monthly salary. The employee pays 4 per cent from his/her salary and the employer up to 11.5 per cent in mandatory pension contributions and the employee pays up to 4 per cent and the employer up to 2 per cent in voluntary pension contributions. These percentages are set out in Act No. 129/1997, on Mandatory Insurance of Pensions and the Activities of Pension Funds as well as collective agreements. It should also be mentioned in this context that Article 5(d) of Act No. 88/2003, on the Wage Guarantee Fund guarantees up to 4 per cent of supplementary pensions in case of bankruptcy. Article 3(4) of Act No. 72/2002, on the Legal Position of Employees in the Transfer of Undertakings states that the protection afforded to employees in the provision does not apply to employees’ entitlement to old-age and invalidity pensions
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or survivors' benefits in the case of pension funds for one or more professions operating under special laws or regulations. However, this can never lead to a reduction in the rights acquired from the pension funds.
4 Other Relevant Information 4.1 Collective agreements The Icelandic Confederation of Labour (ASÍ) and Business Iceland (SA) met this month to decide whether the conditions for continuing the current collective agreements on the labour markets, which will last until the end of 2022, still apply. ASÍ considered the grounds for continuing the collective agreement to be in place, but SA did not, citing the economic developments in light of the COVID-19 pandemic and therefore decided to take the matter to a vote amongst their members. After several discussions between the social partners and the government and the introduction of a government package, which, inter alia, includes a temporary reduction of the social insurance fee and tax breaks for green investments, the vote was cancelled and the collective agreement will remain unchanged.
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Ireland
Summary (I) The Minister for Transport has issued two regulations implementing further provisions of Directive 2017/159/EU and regulations have also been issued to better implement Article 21 of the Working Time Directive 2003/88/EC as regards sea fishermen. (II) Regulations implementing the Posting of Workers Amendment Directive 2018/957/EU have also been issued. (III) The Labour Court has held that a person who reverts to their substantive grade and whose employment continues at the end of a fixed-term assignment does not enjoy protection under the Fixed-term Work Act. ______1 National Legislation 1.1 Measures to respond to the COVID-19 crisis 1.1.1 Unemployment benefits As of 17 September 2020, the rate of the weekly COVID-19 Pandemic Unemployment Payment (PUP) changed: it is now EUR 300 if one earned EUR 300 a week or more; EUR 250 if one earned between EUR 200 and 300; and EUR 203 if one earned less than EUR 200. These rates will apply until 31 January 2021. At the beginning of May 2020, 598,000 persons received PUP. As of 29 September 2020, this figure has reduced to 217,142; 45.5 per cent of whom were female and 21 per cent were under 25. The sectors with the highest number of persons in receipt are: - Accommodation and Food Services (51,840, down from 128,500 in May); - Wholesale and Retail Trades (30,950, down from 90,300 in May); - Administration and Support Services (23,111, down from 45,800 in May); and - Construction (16,913, down from 79,300 in May).
1.2 Other legislative developments 1.2.1 Work in fishing The first set of Regulations, which came into effect on 1 September 2020, better implement Article 21 of Directive 2003/88/EC in relation to certain aspects of the organisation of working time as they relate to workers on board seagoing fishing vessels registered in another Member State whilst in a port in Ireland. The Regulations set out the maximum hours of work and minimum hours of rest for workers on board such seagoing fishing vessels along with enforcement powers and requirements to notify the relevant flag state of any breaches. The second set of Regulations, which came into effect on 1 September 2020, implement the provisions of Article 3 of Council Directive 2017/159/EU concerning the implementation of the ILO Work in Fishing Convention 2007 and Articles. 19, 26, 27 (other Article 27(a)), 29, 30, 31 and 32 of the Annex to the Directive. The Regulations require the fishing vessel owner to ensure that a fisherman receives appropriate medical attention and is taken ashore in a timely manner to receive appropriate treatment. They also place an onus on the owner to make provisions as necessary for
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the repatriation of a fisherman from a port outside Ireland; the costs thereof are to be borne by the owner. The third set of Regulations, which came into effect on 1 September 2020, implement the provisions of Article 3 of Council Directive 2017/159/EU concerning the implementation of the ILO Work in Fishing Convention 2007 and Articles 12 to 18 of the Annex and Annex 1 to the Directive. The Regulations require the master to carry on board a crew list and the owner to ensure that every fisherman employed on board the fishing vessel is provided with a Fisherman’s Work Agreement.
1.2.2 Posting of Workers The fourth set of Regulations, which came into effect on 1 October 2020, transposes Directive 2018/957/EU (which amends Directive 96/71/EC concerning the posting of workers). These Regulations amend the Principal Regulations (S.I. No. 412 of 2016), particularly as regards the definition of “net remuneration”. The Regulations also provide for the definition of “relevant body” to include a temporary employment undertaking and a placement agency and specify the provision of information requirements with which a user undertaking in Ireland, as well as a service provider or relevant body in another Member State, must comply in respect of posted workers.
2 Court Rulings 2.1 Fixed-term Work Labour Court, FTD201, 5 August 2020, Health Service Executive v Power Directive 1999/70/EC was implemented in Ireland by the Protection of Employees (Fixed-term Work) Act 2003, the provisions of which apply solely to “fixed-term employees”. In Health Service Executive v Power FTD201, the complainant had been employed as a permanent pensionable employee since 1999. In October 2014, he took up the appointment as Interim Group Chief Executive of one of the HSE’s units under a series of fixed-term contracts which came to an end in September 2019 when he reverted to his substantive position. In these proceedings, he claimed that he was entitled to a “contract of indefinite duration” as Chief Executive of the Unit and relied, inter alia, on CJEU decisions in case C-307/05, 13 September 2007, Del Cerro Alonso, case C-212/04, 4 July 2006, Adeneler, case C-251/11, 8 March 2012, Huet and case C-16/15, 14 September 2016, Perez-Lopez. The HSE argued that the complainant was never employed as a fixed-term employee and was at all material times employed in permanent and pensionable employment. The Labour Court agreed and held that a person who reverts to their substantive grade and whose employment continues at the end of a fixed-term assignment does not enjoy protection under the Act.
3 Implications of CJEU Rulings 3.1 Transfer of undertaking CJEU joined cases C-674/18 and C-675/18, 9 September 2020, TMD Friction The national legislation at issue in these proceedings are not replicated in Ireland. Directive 2001/23/EC is implemented by the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003 with Articles 3 and 5 being transposed by Regs. 4 and 6. The former provides that the transferor’s rights and obligations arising from a contract of employment existing on the date of a transfer
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shall, by reason of such transfer, be transferred to the transferee. This does not apply in relation to employees’ rights to old-age, invalidity or survivors’ benefits under supplementary company or inter-company pension schemes that do not fall within the social welfare legislation. The Regulation, in para. (4), goes on to provide that the interests of current and former employees in respect of rights conferring immediate or prospective entitlement to old-age benefits under a supplementary company pension scheme that is an occupational pension scheme within the meaning of the Pensions Acts are protected under those Acts. If, however, the scheme is not an occupational pension scheme as defined, then the transferee must ensure that those interests are protected. The latter Regulation provides that Regs. 3 and 4 shall not apply to any transfer where the transferor is the subject of bankruptcy or insolvency proceedings, unless the sole or main reason for the institution of such proceedings is the evasion of an employer’s obligations under the 2003 Regulations. Those Regulations, however, do apply to transfers effected during procedures, the purpose of which is not the liquidation of the transferor’s assets but the continuation of its business activities followed by the transfer of those activities or some of them. This would be the case with transfers effected by an examiner under Part 10 of the Companies Act 2014. Directive 2008/94/EC is implemented by the Protection of Employees (Employers’ Insolvency Acts 1984 to 2012 with Article 8 being transposed by s. 7 of the 1984 Act as amended. This section allows claims to be made from the Social Insurance Fund where an insolvent employer has failed to pay contributions in accordance with an occupational pension scheme. It covers contributions that should have been paid into the scheme by the employer and contributions deducted from employee’ wages which were not paid by the employer into the assets of the scheme by the employer. The maximum sum payable out of the Fund in respect of the employer’s unpaid contributions is the lesser of: (i) the balance of unpaid contributions during the 12 months preceding the insolvency date; or (ii) the amount certified by an actuary being necessary to meet the liability of the scheme to pay the benefits provided by it. The maximum sum payable in respect of employees’ unpaid contributions is the amount deducted from an employee’s pay and payable in the 12 months immediately preceding the insolvency date. Following the CJEU decision in case C-398/11, Hogan, the deficiencies identified were addressed by ss. 9 and 10 of the Social Welfare and Pensions (No. 2) Act 2013. First priority is given to defined contribution assets; second and third priority is now given to 50 per cent of pensioner and members’ benefits and then priority is given to protecting pension benefits up to EUR 12,000. If a scheme has insufficient resources to provide the 50 per cent of benefits and protect EUR 12,000 of pensioner benefits, the Minister for Finance is required to provide for the shortfall in scheme assets.
4 Other Relevant Information Nothing to report.
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Italy
Summary (i) The Italian government has adopted Legislative Decree 15 September 2020, No. 122, transposing EU Directive 2018/957 on the posting of workers. (ii) The Corte di Cassazione has decided that when an undertaking in crisis is transferred, the transferor’s employees have the right to be employed by the transferee, even if the latter applies a different collective agreement. ______1 National Legislation 1.1 Measures to respond to the COVID-19 crisis 1.1.1 Posting of workers Legislative Decree No. 122 of 15 September 2020 transposes EU Directive 2018/957 on the posting of workers. The Decree amends Legislative Decree No. 136 of 17 July 2016. The main changes are the extension of the scope of application; working and employment conditions for posted workers; modification of the maximum duration of transnational postings. Article 1 para. 2-bis. According to the previous legislation, the rules on transnational postings applied to temporary work agencies established in a Member State posting workers to a user company in Italy. The new regulation protects workers posted by a temporary work agency to a first user company which then posts the workers to Italy. Additional disclosure obligations have been introduced both for the user in Italy and for the user in another Member State, if it posts workers to Italy (Article 10-bis). Article 4, para. 1: the list of subjects to which the law of the host Member State may be applied is better specified. In particular: “a) maximum periods of work and minimum periods of rest; b) minimum duration of paid annual leave; c) wages, including overtime surcharges; d) conditions of employment of workers, with particular reference to the supply of workers by work agencies; e) health and safety in the workplace; f) protection of the working conditions of pregnant women or women who have recently given birth, children and young people; g) equal treatment between men and women, and non-discrimination; h) adequate accommodation conditions for workers, in cases where accommodation is provided by the employer to posted workers away from their usual place of work; i) allowance or reimbursement to cover travel, board and lodging expenses for off-site workers for service needs.” The aim of the amendment is to ensure equal treatment between posted and ‘local’ workers, prohibiting any discrimination based on nationality. Allowances paid to the worker for being posted are considered part of the worker’s salary, except if they are paid for food, accommodation or travel reimbursed by the employer. If the national legislation does not define whether some allowances are paid as reimbursement of expenses, the entire allowance received by the posted worker will be considered reimbursement of expenses and will therefore not be considered part of the worker’s remuneration. Article 4-bis: ‘Long-lasting posting’. The maximum duration of the posting has been reduced from 24 to 12 months, which can be extended to 18 months based on a
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motivated communication to the Ministry of Labour and Social Policies. After this period, all the working and employment conditions provided in Italy by laws and collective bargaining will apply to the posted worker, with the exception of those concerning dismissal and resignation, non-competition clauses; and occupation pension schemes. In case of replacement of one or more posted workers, the duration of 12 (or 18) months will be determined by the sum of all periods of work performed by each worker.
1.2 Other legislative developments Nothing to report.
2 Court Rulings 2.1 Transfer of undertakings Corte di Cassazione, No. 17198, 17 August 2020 When an undertaking in crisis is transferred, the transferor’s employees have the right to be employed by the transferee, even if the latter applies a different collective agreement. Act 20 November 2009 No. 166 was issued as a result of an infringement procedure concerning Article 47, para. 5-6, Act 29 December 1990 No. 428, which did not guarantee workers the rights recognised in Article 3, para. 1, 3 and 4 of Directive 2001/EC/23 in the event of a transfer of undertaking in crisis. Article 19 Act No. 166 of 2009 provides that in the event of a transfer of undertaking in crisis, Article 2112 of Civil Code applies within the limits set by collective bargaining. Collective bargaining can regulate working conditions but cannot prevent the transfer of an employee from the transferor to the transferee. A different interpretation would contradict Article 5 of Directive 2001/EC/23.
3 Implications of CJEU Rulings and ECHR 3.1 Transfer of undertakings CJEU, joined cases C‑674/18 and C‑675/18, 09 September 2020, TMD Friction After the opening of insolvency proceedings, the national insolvency guarantee body must intervene to safeguard the rights of employees who are not yet entitled to an old-age pension. This rule has direct effect. Article 47, Act 29 December 1990 No. 428, establishes that in the event of a transfer of an insolvent undertaking, Article 2112 of Civil Code does not apply. If the employee wants his/her credits to be recognised, he/she must submit evidence that he/she is owed credits. If his/her credits are not provided, the Guarantee Fund shall intervene. Article 5 of Legislative Decree No. 80 of 27 January 1992 protects the employee if insolvency proceedings are initiated against the employer and if the employer has not paid the necessary contributions to the supplementary pension fund. If the social security benefit is not paid to the employee, he/she can ask the Guarantee Fund to supplement the missing contributions. The Guarantee Fund can pay the employer’s contribution, the employee’s contribution that the employer has withheld and not paid, and the part of TFR assigned to the fund that the employer has withheld and not paid. The Guarantee Fund will not pay benefits directly to the employee.
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4 Other Relevant Information Nothing to report.
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Latvia
Summary Nothing to report. ______1 National Legislation Nothing to report.
2 Court Rulings Nothing to report.
3 Implications of CJEU Rulings 3.1 Transfer of undertaking CJEU joined cases C-674/18 and C-675/18, 9 September 2020, TMD Friction The CJEU decision in case C-658/18 has no implications for Latvian law. Occupational pensions in Latvia are regulated by the Private Pension Funds Law. According to the law, occupational pensions can be managed by officially registered private pension funds, but not by an employer, as in the present case. Employers may participate in private pension funds by concluding participation agreements and by making contributions for their employees to such private pension funds. The financial means contributed by the employer to a private pension fund do not constitute assets of the employer. Consequently, the insolvency or bankruptcy of an employer has no impact on any savings in private pension funds in Latvia. In addition, in case of insolvency or bankruptcy of a pension fund itself the savings (contributions) under pension plans may not be considered assets of such private pension funds. It follows that under Latvian law, an employee cannot lose his/her acquired rights (rights deriving from the contributions factually made) under a private pension plan. It is worth noting that occupational private pension funds in Latvia are very rare and, in addition, the majority (or even all of them) usually provide for the right to receive the sum of funds actually contributed. This means that in practice, private pension fund plans in Latvia do not provide occupational pension rights based on biometrical data (right to a certain amount of occupational pension until the end of life). Taking the above-mentioned into account, the decision in the present case has no implications for Latvian law.
4 Other Relevant Information Nothing to report.
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Liechtenstein
Summary Nothing to report. ______
1 National Legislation Nothing to report.
2 Court Rulings Nothing to report.
3 Implications of CJEU Rulings 3.1 Transfer of undertaking CJEU joined cases C-674/18 and C-675/18, 09 September 2020, TMD Friction The basis of cases C-674/18 and C-675/18 is the law on occupational pension benefits. It represents a complex system that is structured very differently in the various countries. There are considerable differences between the Liechtenstein and the German system, which was the subject of the main proceedings before the CJEU. The present CJEU judgment assessed the case on the basis of German law, and such a case cannot, in principle, arise under Liechtenstein law. Insofar, the judgment in cases C-674/18 and C-675/18 is not relevant for Liechtenstein. This conclusion results from the circumstances set out below. The basic protection against the risks of old age and death is provided by the Act on Old Age and Survivors’ Insurance (Gesetz über die Alters- und Hinterlassenenversicherung, AHVG, LR 831.10). This Act created an independent institution under public law (Article 1(1) of the Act on Old Age and Survivors’ Insurance), which operates a social security insurance. The aim of this insurance is to cover the subsistence needs (of the person concerned or his/her survivors) in the event of old age or death. This already substantially mitigates the problem, which the CJEU addressed in paragraph 80 of its judgment. The Court held that the minimum protection required according to Article 8 of Directive 2008/94 precludes a manifestly disproportionate reduction of an employee’s occupational old-age benefits that seriously affects the ability of the person concerned to meet his or her needs. That would be the case if a reduction in old-age benefits affected a former employee who, as a result of the reduction, is living, or would have to live, below the at-risk- of-poverty threshold determined by the European Statistical Office (Eurostat) for the Member State concerned. Concerning the law on occupational pension benefits itself, a distinction must be made between the mandatory part and the non-mandatory part. The mandatory part is regulated by the Act on Occupational Pension Plans (Gesetz über die betriebliche Personalvorsorge, BPVG, LR 831.40). This Act also regulates certain aspects of the non-mandatory part (Article 1(2) of the Act on Occupational Pension Plans). Some larger industrial companies have created very generous facilities to promote the recruitment of skilled workers.
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The following regulation applies to both parts: only foundations registered in the Commercial Register and domiciled in Liechtenstein—which means not the employer itself—may operate a pension fund (with an exception for public corporations, Article 13(1) and (3) of the Act on Occupational Pension Plans). This ensures that the funds are not affected by a possible insolvency of the employer. In the case that the pension fund itself should become insolvent, an efficient security fund steps in. The security fund ensures the legal and regulatory benefits of insolvent pension funds (Article 22f (1a) of the Act on Occupational Pension Plans). Article 2a of the Act on Occupational Pension Plans empowers employers—in terms of an alternative for the non-mandatory part—to join an institution for occupational retirement provision within the meaning of the Act on the Supervision of Institutions for Occupational Retirement Provision (Gesetz betreffend die Aufsicht über Einrichtungen der betrieblichen Altersversorgung, Pensionsfondsgesetz, PFG, LR 831.42). The Act transposes Directive (EU) 2016/2341 of the European Parliament and of the Council of 14 December 2016 on the activities and supervision of institutions for occupational retirement provision. Companies and institutions for occupational retirement provision as well as their assets and accounts must be kept legally separate and must adhere to the requirements of the Financial Market Authority. In the event of bankruptcy of a company, the assets of an institution for occupational retirement provision are to be treated analogously as a special mass within the meaning of the Bankruptcy Act (Article 8 of the Act on the Supervision of Institutions for Occupational Retirement Provision). According to the Bankruptcy Act (Gesetz über das Konkursverfahren, Konkursordnung, KO, LR 282.0), the claims of pension funds against affiliated employers are privileged in the latter’s bankruptcy; they fall into the first (best) class. For the non-mandatory part, some provisions of the Civil Code (Allgemeines bürgerliches Gesetzbuch, ABGB, LR 210) must also be observed. If the employer or the employees pay contributions to the pension scheme, the employer must transfer these funds to a foundation, a cooperative or a public law institution. If these funds are used in the employee’s favour for health, accident, life, disability or death insurance with a licensed insurance company or with a recognised health insurance fund, the employer is not required to make the transfer if the employee has an independent entitlement against the insurance company when the insured event occurs (Section 1173a Article 37 (1) and (2) of the Civil Code). It follows from this provisions again that the assets of the employer and the pension fund must be kept separate so that the pension funds are not affected in the event of the employer's insolvency. To substantiate this result, the author of the present report has asked the Liechtenstein Trade Union (Liechtensteinischer ArbeitnehmerInnenverband, LANV) how occupational pension provision is dealt with in Liechtenstein in practice. The following information was provided: for over 30 years, when the use of a pension fund became obligatory, there have been no company pensions or severance payments, which are paid directly by the employer, not even within the framework of collective employment agreements.
4 Other Relevant Information Nothing to report.
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Lithuania
Summary Nothing to report. ______1 National Legislation Nothing to report.
2 Court Rulings Nothing to report.
3 Implications of CJEU rulings and ECHR 3.1 Transfer of undertaking CJEU joined cases C-674/18 and C-675/18, 09 September 2020, TMD Friction The judgment of the CJEU has very limited direct implications for Lithuania’s legal system. The Law on Professional Pension Schemes contains no provision that addresses the situation of pension beneficiaries in cases of transfers of undertakings or businesses. To date, no cases have been dealt with in which an employee’s periods of insurance (and who worked for the transferee) have been rejected. Professional pension schemes are unpopular in Lithuania.
4 Other relevant information Nothing to report.
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Luxembourg
Summary A new bill prohibits arbitration clauses in labour law-related litigation.
______1 National Legislation 1.1 Measures to respond to the COVID-19 crisis Nothing to report.
1.2 Other legislative developments 1.2.1 Arbitration procedures A new bill on arbitration procedures (‘Projet de loi n° 7671 portant réforme de l’arbitrage et modification du titre I. du Livre III. ‘Des arbitrages’ du Nouveau Code de procédure Civile’) has been introduced, aiming to modernise the existing legislation. This bill will explicitly specify that labour law litigations cannot be subject to an arbitration clause.
2 Court Rulings Nothing to report.
3 Implications of CJEU rulings 3.1 Transfer of undertakings CJEU joined cases C-674/18 and C-675/18, 9 September 2020, TMD Friction Points 1 and 2 of this decision have no implications for Luxembourg. Indeed, supplementary occupational pension schemes are regulated by a law dating back to 1999 (see ‘Loi du 8 juin 1999 relative aux régimes complémentaires de pension’). An amending law from 2018 amended this legislation and, specifically, clarified the rules in case of transfers of undertakings. The supplementary occupational pension scheme is transferred to the transferee who is liable both for acquired rights and for the rights in the course of acquisition. Under no circumstances may the transfer of rights acquired or in the course of formation of active members and acquired rights of former members to the assignee lead to a reduction of these rights. There is no derogative rule in case of an insolvency procedure. Also, there is no case law stating that with regard to the principle of equal ranking of creditors, to avoid unfair advantages, the transferee is not liable for rights related to the period before the opening of insolvency proceedings. As regards the third point of the case, which is of less relevance, it must be noted that on the basis of an international agreement (see ‘Convention entre la République fédérale d’Allemagne et le Grand-Duché de Luxembourg relative à la coopération dans le cadre de l’assurance insolvabilité des régimes complémentaires de pension’), the German Pensionssicherungsverein (PSV) also deals with cases from Luxembourg by
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applying Luxembourg’s national legislation. Thus, the question of direct effect for the designated body also applies for Luxembourg.
4 Other Relevant Information 4.1 Psychological harassment The Minister for Labour has announced a bill on psychological harassment, which has not yet been published.
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Malta
Summary A Court of Appeal has ruled that judges determining compensation for unfair dismissals should be guided by principles of natural justice. ______1 National Legislation Nothing to report.
2 Court Rulings 2.1 Compensation for unfair dismissal Court of Appeal (Inferior Jurisdiction), 43/2019, 23 September 2020 This was an appeal from an Industrial Tribunal decision which liquidated the sum of EUR 33,060 by way of compensation for alleged unfair dismissal. The Court of Appeal in its inferior jurisdiction ruled that the Industrial Tribunal had to be guided by the principles of natural justice and it was hence required and bound to give the underlying reasons which lead to its liquidating damages in the amount of EUR 33,060.
Maltese law is silent on the way in which compensation for unfair dismissal should be paid out. Consequently, many judgments differ in the compensation they afford to workers who would have been unfairly dismissed. The principles of natural justice include the principles of nemo judex in causa propria and audi alteram partem together with the principle that judgments must be fully motivated. A breach of such principles would mean that the parties’ right to a fair trial (or fair hearing) has been breached and, consequently, even the Industrial Tribunal has to ensure that it follows such principles. In default, the judgment is not validly issued and is reversed at appeal stage, as was the case in this case. Consequently, the Industrial Tribunal must ensure that all its judgments are well motivated and that the calculations leading to the sum are adjudged by way of compensation and fully explained.
3 Implications of CJEU rulings and ECHR 3.1 Transfer of undertaking CJEU joined cases C-674/18 and C-675/18, 9 September 2020, TMD Friction The outcome of this preliminary ruling judgment affects national law as follows:
Paragraph 1 Maltese law has provisions similar to the national law to which paragraph 1 of the judgment’s conclusions refers. Indeed, the Maltese provisions transposing Directive 2008/94/EC of the European Parliament and of the Council of 22 October 2008 on the protection of employees in the event of the insolvency of their employer. Indeed, Article 8.(1) states that if an employee or persons competent to act in respect of an occupational pension scheme, make a valid claim to the Administration Board and the Administration Board is satisfied that on the date of insolvency there were relevant contributions remaining to be paid by the employer to the scheme, the Administration
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Board shall, subject to the provisions of this regulation, pay into the assets of the scheme out of the Fund the sum which. in the Administration Board’s opinion, is payable in respect of the unpaid relevant contributions (Guarantee Fund Regulations, 2003). Indeed, Maltese Law does provide that the Guarantee Fund shall pay contributions should the employer fail to do so before the commencement of insolvency contributions. Paragraph 2 The Guarantee Fund, in Maltese law, is not bound to pay the pensions itself but, rather, the aim of the Guarantee Fund is the following: Regulation 6 (1) of the Guarantee Fund Regulations, 2003 The Fund shall be utilised at the Administration Board’s discretion, to guarantee payment of valid claims for employees’ outstanding wages and for contributions to be paid by the employer in respect of occupational pension schemes resulting from contracts of service, as defined in the Act, when the Administration Board is satisfied that the employer of an employee to whom these regulations apply, has become insolvent.
Paragraph 3 There is nothing in Maltese law to preclude the direct effect of Article 8 of Directive 2008/94/EC. Indeed, given the way the Law is drafted, it would be definitely competent for the plaintiff (employee) file a suit on the basis of Article 8 of Directive 2008/94/EC and claim direct effect of the same. No law—or court—could preclude such a right.
4 Other relevant information Nothing to report.
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Netherlands
Summary (I) Details for the new relief package have not been issued yet. A new scheme allowing self-employed to apply for social assistance under more favourable conditions is in force. (II) the Rotterdam Court held that it cannot be ruled that a clause contained in a collective agreement precluding seafarers to carry out cargo handling services in a port where dock workers provide cargo handling is exempted from the scope of Article 101 TFEU based on the exception accepted by the CJEU in Albany. ______1 National Legislation 1.1 Measures to respond to the COVID-19 crisis 1.1.1 Temporary Emergency Bridging measure to preserve employment (NOW)-2 The second NOW package (subvention for wage costs) ran from 6 July 2020 until 31 August 2020. According to data of the UWV (the Dutch Public employment service that carries out the scheme), the scheme has led to advance payments of in total EUR 2.13 billion. This has reached 1.3 million employees. Most of the honoured applications for an advance payment came from small and medium enterprises. Details of the third NOW package (see FR August for the general outline) have not been issued yet.
1.1.2 Temporary benefits for self-employed professionals (TOZO) This scheme allows self-employed to apply for social assistance under more favourable conditions than the pre-existing general conditions of the existing Social Assistance for Self-Employed Decree 2004. A successful application can lead to income support or a business loan. The scheme is carried out at municipality level. See previous Flash Reports for the description of the first two schemes. The first scheme ended as per 1 June 2020, the second scheme ended as per 1 October 2020. The third and fourth scheme will run from 1 October 2020 until 1 April 2021 and from 1 April until 1 July 2021 respectively. Other than previously announced (see FR August) the third scheme will not contain any asset test. The Ministry of Social Affairs and employment has announced this in its letter of 30 September 2020. Reason for the change is the more severe general measures that have been announced by the Dutch government on 28 September 2020. It is now expected that a restricted asset test will be introduced as per 1 April 2021.
1.2 Other legislative developments Nothing to report.
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2 Court Rulings 2.1 Seafarers’ work Rechtbank Rotterdam, C/10/601363 / KG ZA 20-683, 27 August 2020 The Rotterdam court ruled on 27 August 2020 in an injunction procedure on a Non- Seafarers Work Clause that precludes seafarers to carry out cargo handling services in a port where dock workers provide cargo handling. This Clause has been negotiated within the bi-annual conference of the confederation of maritime employers’ organisations and the confederation of trade unions. The result of this conference is a ‘Framework Agreement’ on the remuneration and other terms and conditions of seafarers that serves as a basis for collective labour agreements concluded at industry or company level. The Clause entered into force as of 1 January 2020. The employer in this case was a crew management company that provides crews for shipowners. The employer is member of one of the relevant maritime employers’ organisations and bound by a collective labour agreement that includes the Clause. The relevant shipowner in this case was bound by the Clause via a ‘Special agreement’ that incorporates the Clause. However, the cargo handling is carried out by the seafarers and not the dock workers. The trade unions concerned initiated this injunction procedure to force the employer and the shipowner to respect the Clause. The court rejected the unions’ claim. The defence of the employer and the shipowner was considered valid on two points. First, it would be contrary to the reasonableness and fairness to compel the employer and the shipowner to adhere to the Clause. The court substantiated this based on the following: (i) It is in the interest of the crew and the public health (COVID-19) that seafarers carry out the cargo handling (and not the external dock workers). More generally, it is not clear whether it is in the interest of the crew to leave the cargo handling with the dock workers as stated by the unions. (ii) The shipowner was not involved in the negotiations of the Clause and had no possibility to influence the results, although the Clause has a considerable impact on his business operations. Secondly, the court considered that for the time being (the procedure is an injunction procedure, so there are limits to the provision of evidence), it cannot be ruled that the Clause is exempt from the scope of Article 101 TFEU based on the exception accepted by the ECJ in its decision of 21 September 1999 (CJEU, case C-67/96, 21 September 1999, Albany BV v Stichting Bedrijfspensioenfonds Textielindustrie ). The court considered that it is unclear whether the clause contributes directly to improving the working conditions of seafarers, which is necessary for a successful use of the Albany exception. Seafarers are deprived from work and remuneration by denying them the cargo handling and it was not argued convincingly that the Clause would increase the seafarers’ safety. Furthermore, it seems that applying the Clause leads to a situation where cargo handling that used to be carried out by seafarers will be carried out by another group of workers. This seems to not benefit all seafarers (to whom the collective labour agreement applies) but to workers in a different industry, the dock workers. Given this, it cannot be excluded that the Clause is in contravention of competition law. Although an injunction procedure, the case stands out because there are rarely decisions on this particular industry and topic. The issue has a potentially significant impact on the industry and the industrial relations in the industry because of the tension between seafarers and dockworkers and their representatives on the union side of the bi-annual conference as described above. Furthermore, it is an interesting decision from the perspective of the ongoing debate on the possibility for self- employed persons to collectively negotiate their terms and conditions without contravening competition law.
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3 Implications of CJEU rulings and ECHR 3.1 Transfer of undertakings CJEU joined cases C-674/18 and C-675/18, 9 September 2020, TMD Friction These joined cases concerned a transfer of undertaking. These transfers of undertakings took place after the opening of insolvency proceedings and were carried out by the insolvency administrator. In these transfers, both the employment contracts and the assurances which ensued from the supplementary occupational pension scheme were transferred to the transferees. The employees claimed that the transferees were liable with respect to their rights to a retirement pension for the periods of employment completed before the opening of insolvency proceedings. However, according to the referring court, based on national law, it is not acceptable for employed staff who are transferred to be in a position to assert their claim against a new solvent debtor and therefore obtain an unfair advantage in comparison with other creditors. This means, amongst others, that in these circumstances, the liability of the transferee is limited to the portion of pension benefits acquired as a result of his or her service with the undertaking after the opening of the insolvency proceedings. In its preliminary questions, the referring court asked whether Directive 2001/23, in particular, Articles 3(1) and (4) and Article 5(2)(a) of that Directive, must be interpreted as precluding this limitation. According to the CJEU, it does not. Additionally, the referring court asked whether Article 3(4)(b) of Directive 2001/23, read together with Article 8 of Directive 2008/94, must be interpreted as precluding national legislation which provides that, for the portion of the pension benefits for which the transferee is not liable: (i) the Insolvency Guarantee Body established in accordance with national law is not required to intervene where the rights conferring prospective entitlement to old-age benefits were not already definitive at the time when those insolvency proceedings were instituted, and (ii), for the purposes of determining the amount relating to the portion of those benefits for which liability falls on that body, the calculation of that amount is to be based on the gross monthly pay earned by the employee concerned at the time when those insolvency proceedings were opened. According to the CJEU, the answer to this question is yes if the consequence of that legislation is that the employees are deprived of the minimum protection guaranteed by Article 8. This is for the referring court to determine. In the Netherlands, the rules on transfers of undertakings are found in Title 10 of Book 7 of the Civil Code. According to Article 663, the rights and obligations of the employer in the transferred undertaking arising at that time from an employment contract between it and an employee working there are automatically transferred to the acquirer. However, for a year after the transfer, that employer is jointly and severally bound in addition to the transferee for the fulfilment of the obligations under the employment contract that arose before that time. Article 664 shows that exceptions to this rule can be applicable with regard to pension benefits. Additionally, Article 666 contains exceptions for situations in which the transferred undertaking has been declared insolvent. Although the joined cases C‑674/18 and C‑675/18 have received no specific attention so far in Dutch case notes or academic literature, the CJEU ruling is of particular importance for Dutch legislation as there are plans to reshape legislation in the field of transfers of undertakings in case of employer insolvency. There is a draft bill on transfers of undertakings in case of employer insolvency that is being discussed and elaborated. The CJEU ruling will need to be taken into account when further shaping these plans to ensure that the employees of a transferred undertaking are not deprived of the minimum protection guaranteed by Article 8 of Directive 2008/94.
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4 Other relevant information Nothing to report.
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Norway
Summary (I) There have been minor adaptions of existing COVID-19 measures, namely on parental care benefits. Some new relief measures have also been proposed. (II) Regulations on occupational health and safety at construction sites have been amended, entering into force on 1 of January 2021. This entails minor modifications, one of which aims to better implement Directive 92/57/EEC on health and safety requirements at construction sites. ______1 National Legislation 1.1 Measures to respond to the COVID-19 crisis 1.1.1 Parental care benefits Norwegian society was partially locked down by the government in March 2020 due to the COVID-19 outbreak. A number of measures were introduced to prevent the virus from spreading and to mitigate the effects of the pandemic on society (see Flash Report 5/2020). The gradual reopening of society started in April, and by June, virtually all business activities had restarted (see Flash Report 6/2020). The infection rates increased in August and continued to increase in September, particularly in some municipalities. These outbreaks have resulted in a number of local measures such as stricter social distancing regulations, lockdowns of specific kindergartens and schools, etc. Due to increasing infection rates in other countries, the Ministry of Foreign Affairs has reintroduced general advice against non-essential travel abroad. Almost no countries in the Schengen area/EEA15 now meet the criteria for infection levels set by the Norwegian Institute of Public Health. Quarantine has therefore once again been imposed on travellers from these countries and regions. Information on the travel restrictions is available here. The unemployment rate rose sharply during lockdown but has been declining since the reopening started. Statistics on the development in September will be available 2 October here. In September, the government introduced a few adaptions to the existing measures to fight the COVID-19 outbreak, most importantly: The period of parental care benefits has been made more flexible in response to the risk of local lockdowns of kindergartens and schools. The right to parental care benefits has already been expanded: parents have a full annual quota of days for the period from 1 July to 31 December. In case of a local lockdown of kindergarten or schools, parents are now entitled to additional days. The expansion applies from 15 September to 31 December 2020, see more here.
1.1.2 Other proposals Furthermore, the government has proposed a number of measures to further mitigate the economic effects of the COVID-19 outbreak. The measures require changes in the state budget and will be considered by Parliament when it opens in October. The most important new proposals are:
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A second temporary scheme for subsidies to employers who take laid-off employees back for active work. The first scheme is described in Flash Report 6/2020. The second scheme will apply to employees who were laid off after 31 August and return to work at the beginning of October, November or December (see the details here). New relief measures for the tourism industry. The measures include a separate compensation scheme for businesses with a substantial loss of income (NOK 1 billion), a subsidy scheme (NOK 250 million) run by the municipalities aimed at local businesses and new funds (NOK 250 million) for the development and restructuring of business (the details are available here). New funds (NOK 1.9 billion) to stimulate activities in the volunteering and cultural sector and in sports. New funds (NOK 1.5 billion) to compensate loss of income in public transport.
1.2 Other legislative developments 1.2.1 Health and safety at construction sites Regulations on health, safety and the working environment at construction sites of 3 August 2020 No. 1028 (Construction Client Regulations) have been amended (see regulations 11 September 2020 No. 1755). The regulations implement Council Directive 92/57/EEC on the implementation of minimum safety and health requirements at temporary or mobile construction sites. The amended regulations will enter into force on 1 January 2021. In the amended regulations, the duties of the construction client are more precisely defined. For example, it is defined more clearly when the regulations apply to maintenance work, and the duty of risk assessment and risk reduction measures are made more specific. The amendments primarily aim to clarify the existing requirements to construction clients and do not represent substantial changes. However, one adjustment in the wording of § 7 in the regulation is made to avoid any ambiguity of whether Directive 92/57/EEC is being correctly implemented. Article 3 No. 2 of the Directive stipulates that the construction client or the project supervisor shall ensure that prior to the setting up of a construction site, a safety and health plan is drawn up in accordance with Article 5 (b). The regulations required the client to make sure (påse) a plan is prepared. By changing the wording to ensure (sørge for), the aim is to remove any ambiguity that the client is responsible for the actual preparation of the written plan.
2 Court Rulings Nothing to report.
3 Implications of CJEU Rulings 3.1 Transfer of undertaking CJEU joined cases C-674/18 and C-675/18, 9 September 2020, TMD Friction The judgment concerned German law and how employees’ rights related to supplemented occupational pensions are affected by transfers of business activities to new entities after the opening of insolvency proceedings. for the application of
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Directive 2001/23/EC on transfers of undertakings where insolvency proceedings are opened. The judgment may nonetheless have implications for Norwegian law. Directive 2001/23/EC is transposed in the Working Environment Act (WEA) Chapter 16. In contrast to Germany, Norway has chosen to not apply the protection of Article 3 and 4 as a general rule where the transferor is the subject of bankruptcy proceedings, as permitted by Article 5 (1). In WEA § 16-1 (2), there is an exception for “transfers from a bankrupt estate” which applies to WEA § 16-2 and § 16-4 implementing Articles 3 and 4 of the Directive. As the CJEU comments on the scope of Article 5 (1), the judgment has relevance for the scope of the exception in Norwegian law. The Court held that transfers must fulfil three cumulative conditions to fall within the scope of Article 5 (1): (i) the transferor is the subject of bankruptcy proceedings or any analogous insolvency proceeding, (ii) those proceedings are instituted with a view to the liquidation of the transferor’s assets, and (iii) the proceedings are under the supervision of a competent authority (which may be an insolvency practitioner determined by national law). The first and the third condition do not seem to raise particular issues. The Norwegian exception only applies from the opening of bankruptcy proceedings, as defined in Norwegian law. The exception does not apply to transfers before the opening of such proceedings or when a separate institute for negotiating debts is used. When bankruptcy proceedings are opened, a trustee (bobestyrer) is appointed immediately to supervise the proceedings, cf. Act on Debt Negotiations and Bankruptcy § 77. As regards the second condition, it is interpreted broadly in Norwegian law. The aim of bankruptcy proceedings is generally considered to be a way of distributing assets to cover creditors’ claims. There are no reservations in the preparatory works for proceedings where decisions have been made to continue the business activity, cf. Ot.prp. No. 79 (2000–2001) Chapter 5.1. To the author’s knowledge, there is no case law to form the basis for reservations where such decisions are made. In the judgment para. 61–62, the CJEU finds that the second condition was not met, where the objective of the proceedings is the continuation of the business activities, followed by a transfer of those activities. This raises the question whether the Norwegian exception may be too broad. The legal regime for supplementing occupational pensions in Norway distinctly differs from the German system discussed in the present judgment. This makes it difficult to assess the implications of the CJEU’s findings for Norwegian law. In Norway, a supplementing occupational pension scheme is mandatory in employment relationships, and must fulfil certain minimum conditions, cf. the Act on Mandatory Occupational Pensions. There are three types of schemes in the private sector: the defined contribution pension (innskuddpensjon), the defined benefit pension (ytelsespensjon) and a combined scheme, all of which are regulated by separate acts. The employer is responsible for paying the contributions, and the employees have rights to benefits vis-à-vis the relevant insurance fund. The employees’ rights to occupational pensions are therefore not directly affected by the bankruptcy of the employer (and there are a number of specific measures to ensure that the pension funds do not go bankrupt). When employment ends as a result of bankruptcy or otherwise, the employee gets a pension capital certificate or a guarantee of his/her accrued pension (fripolise), depending on the type of scheme he/she is part of. There is, however, a minimum requirement of 12 months of employment for acquiring rights to occupational pensions. The employee may be indirectly affected if the reason for why he/she does not fulfil this requirement is that the employment has been terminated due to bankruptcy of the employer. The CJEU, however, finds that
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Directive 2008/ 94/EC allows states to treat rights that confer prospective entitlement differently from those that are definitive. Furthermore, the employees may be indirectly affected if the employer failed to pay the contributions to the pension fund before the opening of bankruptcy proceedings. There is a State guarantee according to the Act on State Guarantee for Wage Claims in Bankruptcy, which transposes Directive 2008/94/EC. The guarantee covers wages and other remunerations, including pension contributions, up a limit of 2 G (G is a base amount of ca. NOK 100 000). It is difficult to say under what circumstances this guarantee may fail to ensure at least half of the old-age benefits deriving from accrued pension rights under a supplementary occupational pension scheme, as is required in the judgment.
4 Other Relevant Information Nothing to report.
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Poland
Summary The government has determined the minimum wage rate for 2021, raising it compared to the previous year. ______1 National Legislation 1.1 Measures to respond to the COVID-19 crisis Nothing to report.
1.2 Other legislative developments 1.2.1 Minimum wage On 16 September, the Ordinance of the Council of Ministers on the amount of minimum wage and the amount of minimum hourly rate in 2021 was enacted (Journal of Laws 2020, item 1596). As of January 2021, the minimum wage will amount to PLN 2 800 for employees with an employment contract (around EUR 620), and PLN 18,30 per hour for civil law contracts. In 2019, the minimum wage amounted to PLN 2 600 and PLN 17. The change implies a raise in minimum wage by 7.7 per cent. The text of the Ordinance is available here. The legal basis for enacting this Ordinance is the Law of 10 October 2002 on minimum wage (consolidated text, Journal of Laws 2018, item 2177). The information provided by the Ministry of Family, Labour and Social Policy on minimum wage in 2021 is available here. The minimum wage has been continuously increasing in recent years. As in previous years, the Social Dialogue Council did not reach an agreement on the statutory minimum wage for the following year. Competence to determine the amount of minimum wage for 2021 was therefore transferred to the government.
It should be emphasised that the minimum wage will amount to around 53 per cent of the expected 2021 average remuneration in the national economy, i.e. far above the average ratio among OECD countries. Therefore, the minimum wage in Poland seems to be relatively high compared to other countries’ average remuneration.
On the one hand, from a social perspective, the raise in minimum wage can be evaluated positively. On the other hand, however, due to the COVID-19 pandemic situation and the economic crisis, the factual outcome remains to be seen in the future.
2 Court Rulings Nothing to report.
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3 Implications of CJEU Rulings 3.1 Transfer of undertaking CJEU joined cases C-674/18 and C-675/18, 9 September 2020, TMD Friction In Poland, according to Article 231 LC, in case of a transfer of undertaking, the new employer becomes a party to the existing employment relationships by operation of the law. The Labour Code, however, does not refer to supplementary occupational retirement schemes. The Labour Code of 26 June 1974 (consolidated text Journal of Laws 2020, item 1320) is available here. The supplementary retirement schemes, which may be organised by employers, are regulated by: 1. The Law of 20 April 2004 on employee retirement schemes (consolidated text: Journal of Laws 2020, item 686), 2. The Law of 4 October 2018 on employee capital plans (consolidated text: Journal of Laws 2020, item 1342). Article 7 item 4 of the Law of 20 April 2004 provides that in case of a transfer of undertaking, the new employer assumes the obligations of the previous employer that stem from the agreement on supplementary retirement schemes. Article 9 of the Law of 4 October 2018 provides that in case of acquisition of another employing entity or a merger of entities, the new employer should—on behalf of its employees—conclude an agreement within seven days on an employee capital plan with the financial institution that will manage the capital plan. The status of employee claims in case of employer insolvency is regulated in the Law of 13 July 2006 on the protection of employee claims in case of employer insolvency (consolidated text, Journal of Laws 2020, item 7). Article 12 of the Law refers to employee claims that should be covered by the Fund of Outstanding Employee Claims. This provision, however, does not refer to supplementary retirement schemes.
Polish legislation regulates the status of supplementary retirement schemes (organised by employers) in cases of transfers of undertakings. The new employer should be responsible for existing schemes. As far as such schemes are concerned, there is no express provisions on employee protection in case of employer insolvency. The pattern of organising supplementary retirement schemes should be outlined. The employer should conclude a collective agreement with trade union(s) or other employee representative bodies on establishing a supplementary retirement scheme. As a next step, an agreement with the financial institution (e.g. bank) to manage the scheme should be concluded. In case of employer insolvency, this institution should be in charge of financial means collected via contributions to supplementary retirement schemes.
4 Other Relevant Information Nothing to report.
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Portugal
Summary
(I) Measures related to preventive isolation or sickness of workers or their dependents due to COVID-19 have been amended. (II) A state of contingency has been declared for the entire national (mainland) territory, triggering certain measures, inter alia, regulating telework. ______1 National Legislation 1.1 Measures to respond to the COVID-19 crisis 1.1.1 Exceptional and temporary measures Decree Law No. 62-A/2020, of 3 September amends the exceptional and temporary measures related to the COVID-19 pandemic related to employment matters (the measures described below refer to the amendment of Decree Law No. 10-A/2020, of 13 March; see reference to this law in Flash Report March 2020). Preventive isolation: preventive isolation for 14 days of subordinated or self- employed workers due to serious risk to public health determined by the health authorities shall be treated as a situation of sickness. For this purpose, the public health authority shall indicate the start and end date of the preventive isolation situation. Sickness allowance: in case of sickness of a subordinated or self-employed worker due to a disease caused by COVID-19, he/she shall be entitled to sickness allowance corresponding to 100 per cent of the net amount of the reference remuneration, with a maximum limit of 28 days, from which the period of preventive isolation (if applicable) should be deducted. After the period referred to above, the calculation of the sickness allowance shall be made in accordance with the general rules. Justified absence from work: absence from work resulting from the need to preventatively isolate or due to disease caused by COVID-19 of a child or other dependent of the subordinated employee covered by the general social security regime, shall be considered justified up to a maximum of 14 days for each individual case. Decree Law No. 60-A/2020 entered into force on 4 September 2020.
1.1.2 Declaration of state of contingency Resolution of the Council of Ministers No. 70-A/2020, published on 11 September 2020, declares a state of contingency that is applicable to the entire national (mainland) territory in response to the COVID-19 epidemiological situation, until 11:59 p.m. of 30 September 2020. This decree also establishes the exceptional and temporary measures of response to the COVID-19 pandemic within the declaration of the state of contingency, namely measures related to teleworking and the organisation of work, as described below:
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a) As a rule, teleworking depends on the agreement between the employer and the employee, as set forth in the Portuguese Labour Code. However, in some exceptional situations related to the COVID-19 pandemic, teleworking can be imposed by the employer or the worker. b) When requested by the worker, the teleworking regime is mandatory in the following situations (provided that the work-related functions can be carried out under this regime): (i) through a medical certificate for workers covered by the special regime who have with an immunosuppression or workers with a chronic disease, and (ii) for workers with a degree of disability equal or higher than 60 per cent. c) Teleworking is also mandatory, regardless of the type of employment relationship, provided that the functions can be carried out under such a regime, when the physical space of the workplace or the work organisation does not ensure compliance with the guidelines of the Directorate-General for Health (Direcção-Geral de Saúde) and of the Authority for Work Conditions (Autoridade para as Condições do Trabalho). d) Where the teleworking regime is not adopted, the employer may implement preventive measures, namely: (i) the adoption of daily or weekly rotation systems between teleworking and work performed in the usual workplace; (ii) different entrance and exit schedules; (iii) different break and meal times. All the rules described above have already been included in the previous resolutions of the Council of Ministers. However, the Resolution published on 11 September 2020 establishes that the adoption of the rules described in d) are mandatory in the Metropolitan Area of Lisbon and Oporto, except if they are clearly impracticable. This Resolution entered into force on 15 September 2020. The Resolution of the Council of Ministers of 9 September extends the declaration of the state of contingency to the entire national (mainland) territory, within the context of the COVID-19 pandemic, until 11:59 p.m. of 14 October 2020. This Resolution entered into force on 1 October 2020.
1.2 Other legislative developments Nothing to report.
2 Court Rulings Nothing to report.
3 Implications of CJEU Rulings 3.1 Transfer of undertaking CJEU joined cases C-674/18 and C-675/18, 9 September 2020, TMD Friction The recent CJEU ruling issued in joined cases C-674/18 and C-675/18, concerns the interpretation of i) Articles 3 and 5 of Directive 2001/23/EC of 12 March 2001 on the approximation of the Member States’ laws relating to the safeguarding of employees’ rights in the event of transfers of undertakings, businesses or parts of undertakings or businesses ( “Directive 2001/23”), and ii) Article 8 of Directive 2008/94/EC of 22
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October 2008 on the protection of employees in the event of insolvency of their employer ( “Directive 2008/94”). In both cases, a transfer of undertaking had taken place after the opening of insolvency proceedings which were carried out by the insolvency administrator. Two employees brought legal proceedings against the transferees, claiming that such transferees were liable for respecting their rights to a retirement pension under a supplementary occupational pension scheme (benefits granted to them by the transferor) for the periods of employment completed before the opening of insolvency proceedings. As a result, in this judgement, the CJEU analysed whether Directive 2001/23, in particular Article 3 (1) and (4) and Article 5(2)(a) of that Directive, must be interpreted as precluding, in the event of a transfer of undertaking subject to insolvency proceedings that is carried out by the insolvency administrator, national legislation (such as the German one), as interpreted by national case law, which provides that, on the occurrence after the institution of insolvency proceedings, of the event conferring eligibility for a retirement pension under a supplementary occupational pension scheme, the transferee is not liable for an employee’s rights conferring prospective entitlement to that retirement pension where those rights have accrued with respect to periods of employment that pre-dated the opening of the insolvency proceedings. Regarding this issue, the CJEU recalled that the objective of Directive 2001/23 is to protect employees by ensuring the safeguarding of their rights in the event of a change of employer by enabling them to remain in the service of the new employer under the same conditions agreed with the transferor. As stated by EU case law, the purpose of said Directive is to ensure, as far as possible, that the contract of employment continues unchanged with the transferee, in order to prevent the concerned employees from being placed in a less favourable position as a result of the transfer. Therefore, Article 3 (1) of Directive 2001/23 lays down the principle that the transferor’s rights and obligations arising from a contract of employment or from an employment relationship that exists on the date of a transfer are to be transferred to the transferee. However, according to Article 3 (4) of that Directive, unless Member States prescribe otherwise, the above referred rule does not apply in relation to employees’ rights to old-age, invalidity or survivors’ benefits under supplementary occupational or inter- occupational pension schemes outside the Member States’ statutory social security schemes. In any case, it should be noted that even where Member States do not make provision for applying Article 3 (1), they must adopt the measures necessary to protect the interests of employees—including those employees no longer employed in the transferor’s business at the time of the transfer—in respect of rights conferring on them immediate or prospective entitlement to old-age benefits under supplementary schemes. Furthermore, Article 5 (1) of Directive 2001/23 provides that the referred Article 3 is not applicable, unless Member States decide otherwise, to the transfer of undertaking where the transferor is the subject of bankruptcy proceedings or any analogous insolvency proceedings which have been instituted with a view to the liquidation of assets of the transferor and are under the supervision of a competent public authority. In addition, Article 5 (2) of the same Directive states that where Article 3 applies to a transfer of undertaking, a Member State may, subject to certain conditions, not apply certain safeguards referred to in the referred rule. In the situations under analysis in joined cases C-674/18 and C-675/18, the objective of the insolvency proceeding was not the liquidation of the transferor’s assets, but the
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continuation of its business activities followed by the transfer of those activities. Therefore, Article 5 (1) does not apply to these cases. According to the CJEU, the German legislation at issue, as interpreted by national case-law, brought about a partial transfer to the transferee of the obligation to give effect to the rights of the employees to a retirement pension under a supplementary occupational pension scheme. The CJEU analysed whether this national legislation is compatible with EU law and ruled that Article 3 (1) and (4) and Article 5 (2) of Directive 2001/23 “must be interpreted as not precluding, in the event of a transfer of an undertaking subject to insolvency proceedings that is carried out by the insolvency administrator of that undertaking, national legislation, as interpreted by national case-law, which provides that, on the occurrence, after the opening of insolvency proceedings, of an event that confers eligibility for a retirement pension under a supplementary occupational pension scheme, the transferee is not liable for an employee’s rights conferring prospective entitlement to that retirement pension where those rights have accrued with respect to periods of employment that preceded the opening of the insolvency proceedings, provided that, with respect to the portion of the amount for which the transferee is not liable, the measures adopted to protect the interests of the employees are at a level that is at least equivalent to the level of protection required under Article 8 of Directive 2008/94”. According to the said Article 8 of Directive 2008/94, Member States shall ensure that the necessary measures are taken to protect the interests of employees and of persons having already left the employer’s undertaking or business on the date of the onset of the employer’s insolvency in respect of rights conferring on them immediate or prospective entitlement to old-age benefits under supplementary occupational pension schemes outside the national statutory social security schemes. The CJEU has already held that the correct transposition of that provision i) requires a former employee to receive, in the event of the insolvency of his/her employer, at least half of the old-age benefits deriving from accrued pension rights under a supplementary occupational pension scheme, and ii) obligates the Member States to guarantee, in that case, the employee a compensation corresponding to at least one half of the value of his/her rights conferring immediate entitlement under such a scheme. Therefore, the CJEU ruled that “Article 3(4)(b) of Directive 2001/23, read together with Article 8 of Directive 2008/94, must be interpreted as precluding national legislation, as interpreted by national case-law, which provides that, on the occurrence of an event that confers eligibility to old-age benefits under a supplementary occupational pension scheme after the opening of insolvency proceedings in the course of which a transfer of an undertaking has been made, with respect to the portion of those benefits for which the transferee is not liable: (i) the insolvency guarantee body established under national law is not required to intervene where the rights conferring prospective entitlement to old-age benefits had not already become definitive at the time when those insolvency proceedings were opened and (ii) for the purposes of determining the amount relating to the portion of those benefits liability for which falls on that body, the calculation of that amount is to be based on the gross monthly pay earned by the employee concerned at the time when those insolvency proceedings were opened, if the consequence of that legislation is that the employees are deprived of the minimum protection guaranteed by Article 8, which it is for the referring court to determine”.
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According to Article 285 of the Portuguese Labour Code, in the event of assignment by any means of form of ownership of an undertaking, establishment or part of an undertaking or establishment that constitutes an economic unit, the transferee adopts the contractual position of employer of the employees, wholly or mainly assigned to the business unit by operation of law. Employment agreements are transferred with all contractual and acquired rights, including remuneration, years of service, professional category and social benefits. The Portuguese regime of transfers of undertakings referred to above applies to a situation in which the company is declared insolvent, if the measures adopted in the insolvency proceedings aim to maintain the economic unit, with only the ownership of the company being changes (see ruling of the Oporto Appeal Court dated 16 April 2020). In the event of a transfer of undertaking, the transferee is subrogated to the rights and obligations arising from the employment relationships that exist at the time of the transfer. Portuguese law does not expressly provide that certain rights arising from the employment contract are not transferred or are not fully transferred to the transferee (i.e. in Portuguese law, there is no rule similar to that in German legislation dealt with by the CJEU in the cases at issue). Therefore, in principle, the employees’ rights to old-age benefits established under a supplementary pension scheme shall be transferred to the transferee, even where the transfer occurs in the course of insolvency proceedings.
4 Other Relevant Information Nothing to report.
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Romania
Summary (I) Parents have the right to days off from work if schools are closed. (II) A new piece of legislation defines and penalises moral harassment in the workplace. (III) Collective agreements do not yet contain provisions on occupational pension schemes. ______1 National Legislation 1.1 Measures to respond to the COVID-19 crisis 1.1.1 Childcare leave In Romania, the state of alert was once again extended by Government Decision No. 782/2020, published in Official Gazette No. 842 of 14 September 2020. With the beginning of the new school year, Emergency Ordinance No. 147/2020 on granting days off for parents to care for their children in case of reduction or suspension of teaching activities affecting the actual presence of children in schools and early childhood education facilities in response to the SARS-CoV-2 coronavirus, published in Official Gazette No. 790 of 28 August 2020, has been adopted. The employer must grant days off to employees who meet the legal requirements to benefit from them. Failure to comply with this obligation shall be sanctioned with a fine. The allowance for each day off is initially paid by the employer in the amount of 75 per cent of the basic salary corresponding to one working day, but not more than LEI 4,072. The allowance will be reimbursed by the state from the Wage Guarantee Fund. The right to leave days was also provided before the summer holidays by Law 19/2020 (see March 2020 Flash Report). The right to days off is now only granted if school activities are suspended as a result of an epidemiological investigation caused by the spread of the SARS-CoV-2 coronavirus. Such investigations shall be carried out if there is a suspicion of the risk of contamination in a particular school. In Romania, schooling is currently organised in a hybrid system (part of the time, children are physically present in school and are taught online for the rest of the time), hence parents cannot benefit from days off for the days their children are participating in online learning activities. On the other hand, unlike during the period before the summer holidays, teleworkers or home workers also benefit from the right to days off. It is not yet fully clear whether the employment contract is considered to be suspended or active during the days off.
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1.2 Other legislative developments 1.2.1 Employment of foreigners Law No. 200/2020, published in Official Gazette No. 832 of 10 September 2020, amends Ordinance No. 25/2014 on the employment and posting of foreigners in Romania, and for amending and supplementing some normative acts on the regime of foreigners in Romania, providing that a work permit is no longer necessary for employment in Romania of foreigners from the Republic of Moldova, Ukraine and the Republic of Serbia employed in Romania with a full-time individual employment contract, for a maximum period of 9 months within a calendar year.
1.2.2 Moral harassment In addition to the rules adopted in July, which amended the Labour Code to clarify some aspects related to discrimination at work (see also July 2020 Flash Report), Law No. 167/2020 for the amendment and completion of Government Ordinance No. 137/2000 on the prevention and sanctioning of all forms of discrimination, as well as supplementing Article 6 of Law No. 202/2002 on equal opportunities and treatment between women and men was adopted and published in Official Gazette No. 713 of 7 August 2020. It defines and penalises moral harassment at work. Any treatment of an employee by another employee who is hierarchically superior, a subordinate and/or a peer from a hierarchical point of view within the scope of an employment relationship, with the intent or result of a deterioration in working conditions due to the negative impact on the employee’s rights or dignity, by affecting the employee’s physical or mental health or by compromising his/her professional future, is considered moral harassment at work and shall entail disciplinary, contraventional or criminal sanctions, as the case may be. Such conduct is manifested in one of the following ways: a) hostile or undesirable conduct; b) verbal comments; c) actions or gestures. Moral harassment in the workplace is any conduct that by its systematic nature, harms the dignity, physical or mental integrity of an employee or group of employees, jeopardising their work or degrading the work environment. Stress and physical exhaustion also fall within the scope of moral harassment at work. The employer has the obligation to take all necessary measures to prevent and fights acts of moral harassment at work, including by specifying the disciplinary sanctions for employees who commit acts or deeds of moral harassment at work in the undertaking’s internal rules. The employer is prohibited from establishing internal rules or measures in any form that obligate, determine or urge employees to commit acts or deeds of moral harassment at work. The new regulation includes sanctions for non-compliance with the provisions on the prohibition of moral harassment. In addition, if an act of moral harassment at work has been committed, the court may, in accordance with the law: a) order the employer to take all necessary measures to end any acts or deeds of moral harassment at work in relation to the employee in question; b) order the reinstatement of the employee in question; c) order the employer to pay an amount equal to the salary the employee was deprived of; d) order the employer to pay compensatory and moral damages to the employee;
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e) order the employer to pay the amount necessary for any psychological counselling the employee may need for a reasonable period established by the occupational doctor; f) order the employer to modify the employee's disciplinary records.
2 Court Rulings Nothing to report.
3 Implications of CJEU Rulings 3.1 Transfer of undertaking CJEU joined cases C-674/18 and C-675/18, 9 September 2020, TMD Friction Friction Romania transposed Directive 2001/23 by Law No. 67/2006 on the protection of employees' rights in case of a transfer of undertaking, unit or parts thereof, providing that the rights and obligations of the assignor, deriving from the employment contracts and from the applicable collective labour agreement existing on the date of the transfer, shall be fully transferred to the assignee. However, these provisions do not apply if the assignor is the subject of the judicial reorganisation or bankruptcy procedure according to the law. The law does not include any reference to supplementary pension schemes. Currently, collective bargaining agreements may include occupational pension schemes; their regulation is included in the new Law No. 1/2020 on occupational pensions published in Official Gazette No. 10 of 8 January 2020, which transposes the provisions of Directive (EU) 2016/2341 on the activities and supervision of institutions for occupational retirement provisions. In practice, however, collective bargaining agreements do not yet contain provisions on occupational pension schemes. As a result, Romania has not yet dealt with the problems similar to those invoked in joined cases C-674/18 and C-675/18. But the Court's solution could be helpful in the way the rules on the transfer of undertakings and insolvency must be interpreted once occupational pensions negotiated through collective agreements become a reality in Romania.
4 Other Relevant Information Nothing to report.
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Slovakia
Summary Due to the COVID-19 crisis, the Government of the Slovak Republic approved a Resolution on 30 September 2020 on the State of Emergency and a Regulation on certain measures of economic mobilisation, including work duty. ______1 National Legislation 1.1 Measures to respond to the COVID-19 crisis 1.1.1 State of emergency On 30 September 2020, the Slovak government discussed and approved The Resolution of the Government of the Slovak Republic No. 587 of 30 September 2020 on the proposal to declare a state of emergency pursuant to Article 5 of the Constitutional Act No. 227/2002 Coll. on state security in times of war, state of war, state of emergency, as amended. The government approved the proposal to declare a state of emergency (A.1.) from 1 October 2020 for a period of 45 days in the affected territory of the Slovak Republic (B.1.). In times of emergency, the State can, in accordance with the law, restrict fundamental rights and freedoms to the extent necessary and for the time necessary. The government may declare a state of emergency if there is an imminent danger to the life and health of persons, the environment or if major property values will be endangered. The reason for declaring a state of emergency is the COVID-19 pandemic. The state of emergency shall last 45 days, that is, until Saturday, 14 November. This Resolution entered into force on 1 October 2020 and was published in the Collection of Laws – No. 268/2020 Coll.
1.1.2 Measures of economic mobilisation The government also adopted the Regulation of the Government of the Slovak Republic No. 269/2020 Coll. on the implementation of certain measures of economic mobilisation in connection with the declaration of a state of emergency to ensure the management of the second wave of the coronavirus COVID-19 on 30 September 2020. In the Regulation, the government orders the implementation of several measures of economic mobilisation, including work duty, and its financing in a time of declared state of emergency. According to Article 7 of the Regulation, the government orders the implementation of a measure of economic mobilisation in the entire territory of the Slovak Republic pursuant to § 5 letter r) of the Act (No. 179/2011 Coll. on economic mobilisation and on the amendment of Act No. 387/2002 Coll. on the management of the state in crisis situations outside the time of war and martial law, as amended) as required by the crisis management authorities and designated economic mobilisation entities (paragraph 1). A person to whom an issued written order for the performance of work duty is delivered is obligated to accept it from a person authorised to deliver the written order, otherwise the district office is entitled to impose a fine pursuant to Article 32 paragraph 2 of Act No. 179/2011 Coll. (paragraph 2). When issuing an order
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to perform a work duty, the district office shall cooperate with the relevant subject of economic mobilisation for the benefit of which the order is issued (paragraph 3). According to Article 3 letter k) of Act No. 179/2011 Coll. on economic mobilisation and on the amendment of Act No. 387/2002 Coll. on the management of the state in crisis situations outside the time of war and martial law, as amended, work duty refers to: 1. the obligation of the employee to remain in employment and perform work in a place other than the agreed place of work and the agreed type of work, if the employer is an economic mobilisation entity and if the job in question is a job in the organisational structure of the economic mobilisation entity in times of crisis, 2. the obligation of a natural person to perform the tasks necessary to manage economic mobilisation measures in times of crisis. This Regulation entered into force on 1 October 2020 and was published in the Collection of Laws – No. 269/2020 Coll.
1.2 Other legislative developments Nothing to report.
2 Court Rulings Nothing to report.
3 Implications of CJEU Rulings 3.1 Transfer of undertaking CJEU joined cases C-674/18 and C-675/18, 9 September 2020, TMD Friction In the Slovak Republic, occupational pension rights are not regulated in labour law but in social security law, which is a separate legal branch. Social security in Slovakia is based on three pillars representing an important mandatory public pillar (1st pillar),and the old-age pension saving system (2nd pillar). Together with the old-age insurance (1st pension pillar), the old-age pension saving (2nd pension pillar) constitutes the basic pension insurance system. The system of social security is enhanced through tax deductible voluntary saving/insurance schemes, supported by the state (3rd pillar). As regards occupational pension rights, the main legal sources are Act No. 461/2003 Coll. on social insurance, Act No. 43/2004 Coll. on old-age pension savings and Act No. 650/2004 Coll. on supplementary pension savings. There is no legal regulation of "internal company social insurance" in Slovakia. All contributions are made by each employer to the employee's account in the Social Insurance Agency, pension management company and supplementary pension company.
Act No. 461/2003 Coll. on social insurance (1st pillar of the pension system) Social insurance is provided by the Social Insurance Agency (Article 120 paragraph 1 of the Act). The Social Insurance Agency is a public service organisation established to provide social insurance (Article 120 paragraph 2 of the Act). There is no "transfer", employees do not lose their rights. According to Article 1 paragraph 2 of Act No. 461/2003 Coll. on social insurance “This Act also regulates the performance of old-age pension savings to the extent provided by a special regulation.1)”.
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(Remark 1): Act No. 43/2004 Coll. on old-age pension savings.)
Act No. 43/2004 Coll. on old-age pension savings (2nd pillar of the pension system) This is an old-age pension saving system - a voluntary system of pension savings, in which the Social Insurance Agency puts aside part of a client’s contributions who has joined the 2nd pillar. Savings in the 2nd pillar does not mean leaving the state 1st pillar. The aim of the 2nd pillar is to complement the first one. Old-age pension savings are provided by pension management companies. Entrance to the 2nd pillar means concluding an old-age savings contract with one of the pension management companies. Contributions under the 2nd pillar go to the saver’s personal pension account and are managed by the pension management company.
Act No. 650/2004 Coll. on supplementary pension savings (3rd pillar of the pension system) Supplementary pension savings are voluntary, and the participants' funds are managed by supplementary pension companies. Supplementary pension companies are a joint-stock company with a registered office in the territory of the Slovak Republic, the subject of which is the establishment and administration of supplementary pension funds for the purpose of performing supplementary pension savings on the basis of a permit for the establishment and operation of a supplementary pension company granted by the National Bank of Slovakia (Article 22 paragraph 1 of the Act).
4 Other Relevant Information Nothing to report.
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Slovenia
Summary The government adopted the Fifth Anti-Corona Package (PKP5) and submitted it to the National Assembly for adoption. The PKP5 will introduce new relief measures and extend already existing ones, such as partial reimbursement of wage compensation for temporarily laid-off workers, basic income for self-employed persons and compensation during quarantine. ______1 National Legislation 1.1 Measures to respond to the COVID-19 crisis 1.1.1 The Fifth Anti-Corona Package On 29 September 2020, the government adopted the Proposal for the Act Determining Intervention Measures to Mitigate and Remedy the Consequences of the COVID-19 Epidemic for Citizens and the Economy (‘Predlog Zakona o interventnih ukrepih za omilitev in odpravo posledic epidemije COVID-19 za prebivalstvo in gospodarstvo’, not yet published at the time of writing, therefore, no link to the relevant document can be provided) and forwarded it to the National Assembly for adoption. The so-called Fifth Anti-Corona Package (‘Peti protikoronski paket – PKP5’) includes several measures related to health, social protection, labour, the economy, education, etc. in response to the COVID-19 crisis. According to the government, the fifth package of measures introduces new or extends already existing measures that focus on job protection, care for the elderly and the prevention of the spread of coronavirus infections. The following measures covered by the PKP5 are especially relevant from the perspective of labour law (they may be changed/amended in the legislative procedure; this is the government’s proposal, as presented in the media and on their website, available here). Partial reimbursement of wage compensation for temporarily laid-off workers due to the epidemic crisis: this measure, introduced in April 2020 and extended monthly, will be extended again, this time until the end of 2020, however, the eligibility criteria will be stricter (instead of a 10 per cent, a 20 per cent decrease in revenues in 2020 compared to 2019 due to the COVID-19 crisis). The social partners have raised concerns about this measure: the employers’ side cautions that the eligibility criteria are too strict, whereas the trade unions warn that effective prevention of possible abuses of this measure is lacking. For a detailed description of this measure and the chronology of legal acts that introduced/extend this measure, see previous Flash Reports, in particular, Flash Report 05/2020 and Flash Report 08/2020. Basic income for self-employed persons in the amount 700 EUR net per month and a reimbursement of contributions in the amount of 400 EUR per month. Special wage supplements for health workers and other employees in social protection and health care institutions, who work directly with infected persons. Possibility of temporary deployment of employees in social protection and healthcare institutions (to cover additional needs in senior homes). Possibility to take paid absence from work due to illness for up to 3 working days without a personal physician’s certificate Additional rules on wage compensation during quarantine: in addition to the existing rules valid until 30 September 2020 (a detailed description is available
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in Flash Report 07/2020) which will be extended, two additional instances in which the State will reimburse the costs for (wage) compensation during a quarantine are envisaged: (a) in case of absence from work to care for a child who was ordered to quarantine, a parent will be entitled to 80 per cent wage compensation (only for children until the fifth grade of primary school); according to the existing rules, a parent is entitled to compensation in the amount of 50 per cent of his/her previous salary but not less than 70 per cent of minimum wage, whereby this compensation is not reimbursed by the State; (b) a self-employed person in quarantine will be entitled to compensation in the amount of 250 EUR.
1.1.2 Other COVID-19 measures Various anti-corona measures continue to be in force, amended and/or replaced with the new ones and may have direct or indirect implications in the field of labour law. In general, as a response to the deterioration of the epidemic situation in Slovenia, the government is gradually introducing stricter measures (with respect to wearing face masks, opening hours of restaurants, bars, the gathering of people, etc.), however, the border crossing regime has been slightly loosened following the EU common approach to travel measures (green/orange/red countries etc.).
1.2 Other legislative developments Nothing to report.
2 Court Rulings Nothing to report.
3 Implications of CJEU Rulings 3.1 Transfer of undertaking CJEU joined cases C-674/18 and C-675/18, 9 September 2020, TMD Friction This case concerned the liability for an employee’s rights conferring prospective entitlement to a retirement pension under a supplementary occupational pension scheme in case of a transfer of undertaking subject to insolvency proceedings and in particular, the liability for these rights with respect to periods of employment that preceded the opening of the insolvency proceedings. According to German legislation, in case of a transfer of undertaking subject to insolvency proceedings, the transferee is not liable for these employee’s rights (it is liable only with respect to periods of employment after the opening of the insolvency proceedings in the course of which the transfer of undertaking has been made). Besides, the insolvency guarantee body (the ‘Pensions-Sicherungs-Verein’ - PSV) is not required to intervene where the rights conferring prospective entitlement to old-age benefits had not already become definitive at the time when those insolvency proceedings were opened; and for the purposes of determining the amount relating to the portion of those benefits liability for which falls on that body, the calculation of that amount is to be based on the gross monthly pay earned by the employee concerned at the time when those insolvency proceedings were opened. The CJEU ruled that Directive 2001/23/EC does not preclude national legislation which provides that in such a case, the transferee is not liable for the employee’s rights,
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prospective and accrued, stemming from the supplementary occupational pension scheme with respect to periods of employment that preceded the opening of the insolvency proceedings, however, the minimum protection of the employees, at least equivalent to the level of protection required under Article 8 of Directive 2008/94/EC (protection of employees in the event of employer insolvency) must be guaranteed and provided otherwise. The CJEU further dealt with the protection guaranteed to such employees by the insolvency guarantee body established under national law (the ‘Pensions-Sicherungs- Verein’ - PSV) in light of Article 3(4)(b) of Directive 2001/23/EC and Article 8 of Directive 2008/94/EC (protection of the interests of employees and of persons that have already left the employer’s undertaking before the opening of insolvency proceedings in respect of rights conferring immediate or prospective entitlement on them to old-age benefits under supplementary occupational pension schemes). The CJEU emphasised that the employees must not be deprived, whatever the regime, of the minimum protection guaranteed by Article 8 of Directive 2008/94/EC. The CJEU again repeated that Article 8 of Directive 2008/94/EC is capable of having direct effect, and that it can be relied upon in proceedings against the insolvency guarantee body, which is a body governed by private law if certain conditions are met, which it is again for the referring court to determine. The CJEU judgment in joined cases C-674/18 and 675/18 is of little relevance for Slovenian law, as the legal regulations of supplementary occupational pension schemes is quite different from the German one. There is no specific provision in the Slovenian legal order (neither in labour legislation nor in insolvency legislation) which would, in the meaning of Article 5(1) of the Directive 2001/23/EC, provide that rules on safeguarding the employees’ rights in the event of a transfer also apply in bankruptcy and analogous proceedings which have been instituted with a view to the liquidation of the transferor’s assets. As regards employees’ rights under the supplementary occupational pension schemes, according to Article 239 of the Pension and Disability Insurance Act (‘Zakon o pokojninskem in invalidskem zavarovanju’, ZPIZ-2), Official Journal of the Republic of Slovenia, Nos 96/12 et subseq, available here), in case of a transfer of undertaking, the contractual and other rights and obligations under the pension plan agreement or relevant provisions of a collective agreement on collective supplementary pension insurance that existed on the day of the transfer are transferred from the transferor to the transferee, unless otherwise agreed upon by the transferor and the transferee. That means that there is no obligatory automatic transfer of these rights and obligations to the transferee. According to Article 239 of the Pension and Disability Insurance Act, it is left to the decision of the transferor and the transferee whether the rights and obligations in respect of supplementary pension schemes will be transferred or not. If the transferor and transferee do not arrive at an agreement on the supplementary pension scheme, the rights of the employees in this respect are safeguarded and transferred to the transferee (Article 239, paragraph 1). In this case, the transferee can finance more than one pension plan (Article 233, paragraph 6). These rights are guaranteed to the employees by the transferee under the same rules as before for at least one year after the transfer, unless the pension plan agreement or collective agreement expires or a new pension plan agreement or a collective agreement which covers all employees of the transferee is concluded before the expiry of one year (Article 239, paragraph 2). After the expiry of one year, the transferred employees join the transferee’s supplementary pension scheme if there is one (Article 239, paragraph 3). The employees may transfer their funds from the transferor’s supplementary pension scheme to the new, transferee’s pension scheme within one year from the date of the transfer (Articles 248 and 239, paragraph 3); if they do not decide on this option, the employees retain their rights within the previous pension scheme in relation to the periods prior to the date of the transfer (Articles 247 and
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239, paragraph 3). The transferor is liable for the payment of supplementary insurance premiums for the periods before the date of the transfer (Article 239, paragraph 4). The payment of such supplementary pension insurance premiums is protected in case the transferor is subject to insolvency proceedings, first, by means of a privilege (for six months prior to the opening of the insolvency proceedings – Article 21(1) of the Financial Operations, Insolvency Proceedings and Compulsory Dissolution Act (‘Zakon o finančnem poslovanju, postopkih zaradi insolventnosti in prisilnem prenehanju’ – ZFPPIPP, Official Journal of the Republic of Slovenia, Nos 13/14–consolidated text et subseq, available here), and second, by a guarantee institution (for the last three months and a ceiling applies – Article 19 of the Public Guarantee, Maintenance and Disability Fund of the Republic of Slovenia Act (‘Zakon o Javnem štipendijskem, razvojnem, invalidskem in preživninskem skladu Republike Slovenije' – ZJSRS, Official Journal of the Republic of Slovenia Nos 25/1997 et subseq, available here). According to Slovenian law, the pension funds under the supplementary occupational pension schemes are separate from the assets of the (insolvent) employer and are not affected by the insolvency proceedings which have been opened against the employer. According to the Pension and Disability Insurance Act, the supplementary occupational pension scheme is agreed upon by concluding an agreement between the employer and the employee representatives (representative trade unions at the company level or works council) or on the basis of a collective agreement which defines the pension plan (Articles 233 and 234); on this basis, the pension fund, as separate assets and not part of the employer’s assets, is established and managed by the management entity (pension funds may only be established and managed by pension companies, insurance companies or banks that meet the prescribed conditions) with whom the employer concludes an agreement (Article 237) and on this basis, pays the supplementary pension premiums on behalf of their employees into the pension fund. On the basis of the agreed supplementary occupational pension scheme, the employer is liable for the payment of the supplementary pension premiums, whereas the pension company that manages the pension fund is liable, when certain conditions are met, for the payment of benefits out of the pension fund according to the agreed supplementary pension scheme. The supplementary pension insurance model in Slovenia is based on the principle of a defined contribution system; supplementary pension schemes based on a defined benefit model are not possible.
4 Other Relevant Information Nothing to report.
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Spain
Summary (I) New rules implementing the European Framework Agreement of 2002 have been issued, providing detailed regulation for teleworking and remote working. (II) Special rules aimed at protecting workers and undertakings against the effects of the COVID-19 crisis have been extended until 31 January 2021. ______1 National Legislation 1.1 Measures to respond to the COVID-19 crisis 1.1.1 Teleworking/remote working For decades, Spanish legislation has provided rules for work that takes place outside the workplace and called such forms of work different names, but can generally all be translated as ‘remote working’. Teleworking (or telecommuting) is one of the modalities of such remote working, but not the only one (for example, many people who manufacture clothing for commercial establishments work from their own homes). Teleworking differs from these other more traditional activities due to exclusive or prevalent use of ICT. In any case, these modalities differ from regular onsite work carried out at the undertaking’s premises or at a place determined by the undertaking, and not at a place freely chosen by the worker. These new rules do not, however, apply to anyone who occasionally performs remote work, but is carried out on a regular basis, that is, for at least 30 per cent of the working day within a three-month period. Thus, the status of remote workers can change over time, and such a status can be acquired and lost. It should be taken into account that the law requires a minimum of 50 per cent of onsite work in two cases: 1- Workers under the age of 18 years. 2) Training contracts. The amount of remote work is limited in both situations. On the other hand, there is no specific limitations for fixed-term employment contracts and part-time work. Remote working is based on the principle of voluntariness, i.e. the worker does not have to accept this modality. The agreement must be concluded in writing and a minimum content must be legally established. That is, remote working cannot be imposed, neither by the employer, nor by collective bargaining. The worker's refusal to work remotely is not a just cause for dismissal nor does it justify any retaliation by the employer. Remote working can be agreed at the beginning of the employment relationship or later, and can apply to the entire working day or be combined with onsite work, but both the worker and the employer have the right to abandon this modality and return to full onsite work. Collective bargaining cannot impose remote working, but can provide more specific rules. Remote workers are considered regular workers, i.e. they are covered by labour law. They therefore have the same rights as onsite workers in terms of salary, working time, reconciliation of work and family life, freedom of association, right to strike, vocational training, etc. They also enjoy fundamental rights, such as protection of personal data and, specifically, the right to equality and non-discrimination. As specific rights, the undertaking must provide all the means, equipment and tools necessary for the development of the activity, address the 'technical difficulties' that may arise, as well as apply all the measures to protect the worker against health and safety risks, although the worker's permission is necessary to access his/her home.
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Besides, the worker has the right to digital disconnection outside his/her working hours, a right that has been recognised in Spain since the Data Protection Law of 2018. It is worth noting that workers who carry out remote work from the beginning of their employment relationship for the entire working day have priority to change to onsite working, and the undertaking must provide the relevant information to the workers and their legal representatives. On the other hand, the law allows remote work requests for those workers who are simultaneously studying. The undertaking also has its own rights and powers, i.e. it can implement surveillance and control measures. However, the installation of programmes or applications on devices owned by the worker is prohibited, and the undertaking cannot require the worker to use his/her own devices to perform the activities. The undertaking must generally provide the digital devices necessary to carry out the activity, as well as rules to clarify whether the worker can use these devices for personal purposes, or only for work-related tasks. Labour courts are competent to resolve conflicts on remote working through a preferential and summary proceeding created for these purposes. On 29 September, new rules on teleworking in public administration were approved, and some regions also have their own regulations for teleworking in their own administrations. More information is available here. The 2002 European Framework Agreement on Telework has been transposed in the Spanish legal system by some collective agreements, but not through a law of general scope. During the lockdown due to the effects of the COVID-19 pandemic, teleworking was legally declared a 'priority' work modality, except for activities considered to be essential. This provision implements the European Agreement and provides a much more detailed regulation for remote working and teleworking.
1.1.2 Employment protection As discussed in previous Flash Reports (from March to June), the government approved numerous measures to protect workers and undertakings during the state of emergency. Specifically, layoffs due to COVID were prohibited because the main objective was to overcome this situation without huge job losses: this notwithstanding, unemployment rose in August by 89,849 persons, and there are currently 3,773,034 unemployed persons. The government is providing financial aid to undertakings, i.e. instead of terminating work contracts, employers had to adopt less damaging measures, such as the suspension of employment contracts, the reduction of working hours or changes in working conditions. Workers affected were entitled to unemployment benefits, because more flexible rules were implemented. Those temporary measures lasted first until June and were then extended until September 30. The pandemic’s impact on the economy is still severe, hence these special measures were extended again, this time until 31 January 2021.
1.2 Other legislative developments Nothing to report.
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2 Court Rulings Nothing to report.
3 Implications of CJEU Rulings 3.1 Transfer of undertaking CJEU joined cases C-674/18 and C-675/18, 9 September 2020, TMD Friction The situation in Spain differs significantly from the one described in the ruling, hence there will be no implications for Spanish legislation, or rather it is difficult to foresee any. According to Article 44 of the Labour Code, in the event of the transfer of an undertaking, the transferee is subrogated to the rights and obligations arising from the employment relationships existing at the time of the transfer, and among them, employee welfare benefits are explicitly mentioned. According to Spanish law, social security is public. Supplementary occupational or inter-occupational pension schemes and any other benefits created by collective agreements or by decision of the employer are allowed, but they are not part of the social security system. Several years ago, problems arose because these types of benefits could be modified (reduced and even eliminated) by new collective agreements, so some workers or ex-workers could suffer losses. The law changed and introduced the mandatory ‘externalisation’ of these private benefits, so it is not the employer who pays the benefits. This prevents the workers from bearing the risk of a future insolvency of the undertaking. Private insurance companies play a decisive role due to this externalisation. The employer pays the insurance premium and the worker has the right to enjoy the benefits when the time comes. Therefore, after a transfer of undertaking, the transferee must continue to pay the insurance premiums, because the subrogation affects this obligation, but neither the transferor nor the transferee pays the benefits directly to the worker. Instead, it is the private insurance company that is legally required to pay the benefits, so the workers cannot lose their rights due to the transfer of undertaking. Obviously, problems may arise if the insurance premiums are not paid, but this is a different issue.
4 Other Relevant Information Nothing to report.
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Sweden
Summary The Swedish labour court ruled on possible limitations to the right to collective bargaining. ______1 National Legislation Nothing to report.
2 Court Rulings 2.1 Collective Bargaining Arbetsdomstolen, AD 2020 No. 47, 19 August 2020 In its judgment AD 2020 No. 47, the Swedish labour court ruled in one of several pending cases involving the independent (not organised in the Swedish trade union confederation, LO) trade union the Swedish Dockworkers’ Union and APM Terminals on industrial relations in the harbour of Gothenburg. In the present case, the trade union claimed that the employer had not collectively negotiated before it took a far-reaching managerial decision. The trade union also claimed that the employer had breached the Work Environment Act. According to section 11 of the Swedish Co-determination Act (lag [1976:580] om medbestämmande i arbetslivet), an employer must enter into negotiations with a trade union with which the employer is bound by a collective agreement regarding significant changes in its activities. The labour court held that the employer’s decision to temporarily group the working teams differently was not a significant change. The court held, however, that the trade union’s safety representative should have been involved in the changes according to Chapter 6 section 10 of the Work Environment Act (arbetsmiljölagen [1977:1160]) and section 3 of the Act on Protection of Union Representatives (lag [1974:358] om facklig förtroendemans ställning på arbetsplatsen).
The judgment is not a landmark case, but reflects a long-lasting, continuing, industrial struggle between the “outside” trade union, which is not organised in the Trade Union Confederation (LO), the “established” Transportation Workers’ Union (which is part of the LO) and the employers. The continuing struggle or dispute, which has also been subject to industrial action, has been described in previous Flash Reports in 2018 and 2019. It has resulted in intense political debate and even some restrictions of the right to collective action (2019).
3 Implications of CJEU Rulings 3.1 Transfer of undertakings CJEU joined cases C-674/18 and C-675/18, 9 September 2020, TMD Friction The CJEU held that 1) it is compatible with EU law for an acquirer of an insolvent undertaking to not be responsible for pension rights that were accumulated in a previous undertaking if the employee is compensated by other means. 2) German law was found to not be compatible with EU law as it only requires an acquirer of an insolvent undertaking to assume responsibility for pension rights that were definitive at the time of the transfer. 3) Lastly, the Court held that the applicable EU Directives
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could have a vertical direct effect even though the organ responsible for pensions was private. Directive 2001/23 has primarily been implemented in Swedish law in Section 6b of the Employment Protection Act (lag [1982:80) om anställningsskydd). The second paragraph of this section states that the prerequisites for transfers of undertaking, like in Germany, are not applicable in case of insolvency. Unlike German law, however, Swedish law compensates employees’ pension claims in accordance with Sections 1 and 7 of the Act on Protection of Employees in the event of employer insolvency (lönegarantilagen [1992:497]). Hence, Swedish law seems to be compatible with this part of the CJEU’s judgment. According to Section 6b of the Swedish Employment Protection Act, individual pension rights of an employee are not transferred when an undertaking is transferred. Swedish law differs here between individually earned pension rights and pension rights in collective agreements. Pension rights in collective agreements are transferred to the acquirer in case of a transfer of undertaking in accordance with Section 28 of the Swedish Co-determination Act (lag [1976:580] om medbestämmande i arbetslivet). If the judgment is to be interpreted that all pension rights must be transferred to the acquirer, Swedish law is seemingly not fully compatible with EU law. It must, however, be emphasised that 1) Swedish legal literature has discussed what the exception in Section 6 b for individual pension rights really means, and 2) that individual pension rights are much less important in practice than collective pension rights. Lastly, the CJEU held that the Directive can have vertical direct effect for the relationship between an employee and the German private body that pays out the pensions. In this regard, the Swedish and German pension systems similarly rely on private bodies. In contrast to the German body in the present case, Swedish companies involved in pension management are not, however, indicated by the State. Instead, they are typically owned by the social partners. Therefore, the Swedish bodies can probably not be regarded as an extension of the State legitimising the use of vertical direct effect of Directives.
4 Other Relevant Information 4.1 Proposed amendments to the Employment Protection Act In May, a government inquiry presented proposals for major reforms of the Employment Protection Act. The Swedish social partners rejected the proposal and were given the opportunity to negotiate a proposal of their own. The deadline was set to 30 September 2020. Their proposal will be discussed in the next Flash Report.
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United Kingdom
Summary (i) The UK has introduced a Job Support Scheme (JSS), replacing the furlough scheme. It will run for 6 months from 01 November 2020. (ii) A new regulation requires those who have tested positive for the virus to self- isolate. ______1 National Legislation 1.1 Measures to respond to the COVID-19 crisis 1.1.1 Job Support Scheme On 24 September 2020, the Chancellor announced the Job Support Scheme (JSS) that will run for six months from 01 November 2020. This will replace the furlough scheme. In summary, the government says: • The Job Support Scheme is designed to protect viable jobs in businesses that are facing lower demand over the winter months due to COVID-19, to help keep their employees attached to the workforce. The company will continue to pay its employees for time worked, but the burden of hours not worked will be split between the employer and the government (through wage support) and the employee (through a wage reduction), and the employee will keep his/her job. • Now that the economy is opening up, support should target those businesses that need it most: focussing on those that are being impacted by the coronavirus and who can support their employees to carry out some work, but that need more time for demand to recover. • The government will pay one-third of hours not worked up to a cap, with the employer also contributing one-third. This will ensure employees earn a minimum of 77 per cent of their normal wages, where the government contribution has not been capped. • Employers using the Job Support Scheme will also be able to claim the Job Retention Bonus if they meet the eligibility criteria. • The scheme will open on 01 November 2020 and run for 6 months, until April 2021. Further guidance will be published shortly.
1.1.2 Health and safety measures SI 2020/1045, the Health Protection (Coronavirus, Restrictions) (Self-Isolation) (England) Regulations 2020 requires those who have tested positive for the virus to self-isolate for 10 days and the individual’s contacts via track and trace for 14 days. There are significant fines (£1 000 - £10 000) for non-compliance.
1.2 Other legislative developments Nothing to report.
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2 Court Rulings Nothing to report.
3 Implications of CJEU Rulings 3.1 Transfer of Undertakings
CJEU, joined cases C-674/18 and C-675/18, 09 September 2020, TMD Friction Under the UK rules implementing Directive 2001/23, Reg 10 of the Transfer of Undertakings (Protection of Employment) Regulations provide that most rights under occupational pension schemes are carved out of TUPE and so the transferee does not need to replicate those rights. However, following Beckmann and Martin, there are exceptions to old-age, invalidity and survivors’ benefits and so these will be transferred. In the event of insolvency, the UK set up the Pension Protection Fund. Hogan Lovells summarises the position as follows: “The PPF was set up as a lifeboat for defined benefit schemes in deficit where the pension scheme employers become insolvent. Various conditions must be satisfied in order for the pension scheme to be transferred to the PPF. First, a qualifying insolvency event must have occurred to the pension scheme employer, and this will trigger an “assessment period”. During the assessment period the scheme's eligibility or otherwise will be determined. One of the key eligibility conditions is that the scheme's assets must be less than the level of the scheme's "protected liabilities". The protected liabilities are the compensation that would be paid to the scheme members if the scheme goes into the PPF (in many cases, less than the benefits that would have been paid under the scheme rules). If the scheme has sufficient assets to meet these liabilities, then the PPF will cease to be involved with the scheme and it is likely to wind up outside the PPF. If a pension scheme is transferred to the PPF, the scheme assets are transferred too and it assumes responsibility for paying the PPF level of benefits to members of the scheme.”
They also point out that under Section 75 of the Pensions Act 1995, the sponsoring employer of a defined benefit occupational pension scheme shall pay an additional contribution (the section 75 debt) to the scheme trustees if: the employer becomes insolvent or enters voluntary winding up; the scheme goes into winding up; or where the scheme is a multi-employer scheme, one of the employers ceases to have any employees who are active members of the scheme when another employer continues to employ active members (an ‘employment cessation event’). The third circumstance may occur when a participating employer is sold out of a corporate group (or all its workforce transfers to a new employer under a TUPE transfer) or when the last remaining active member employed by that employer leaves pensionable service. So PPF acts as a fall back. Direct effect will be turned off in the UK from 01 January 2021.
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Flash Report 09/2020
4 Other Relevant Information 4.1 Telework The updated guidance urges workers to work from home where they can, having been encouraged to go back to work.
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