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Flash Reports on Labour Law May 2020 Summary and reports

Written by The European Centre of Expertise (ECE), based on reports submitted by the Network of Labour Law Experts

May 2020

EUROPEAN COMMISSION Directorate DG Employment, Social Affairs and Inclusion Unit B.2 – Working Conditions Contact: Marie LAGUARRIGUE E-mail: [email protected] B-1049

Flash Report 05/2020

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LEGAL NOTICE The contents of this publication are the sole responsibility of the author(s). The contents of this publication do not necessarily reflect the position or opinion of the European Commission. Neither the European Commission nor any person/organisation acting on behalf of the Commission is responsible for the use that might be made of any information contained in this publication. This publication has received financial support from the European Union Programme for Employment and Social Innovation "EaSI" (2014-2020). For further information please consult: http://ec.europa.eu/social/easi. information on the European Union is available on the Internet (http://www.europa.eu). : Publications Office of the European Union, 2020 ISBN ABC 12345678 DOI 987654321 © European Union, 2020 Reproduction is authorised provided the source is acknowledged.

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Country Labour Law Experts Martin Risak Daniela Kroemer Wilfried Rauws Krassimira Sredkova Ivana Grgurev Nicos Trimikliniotis Nataša Randlová Natalie Videbaek Munkholm Gaabriel Tavits Ulla Liukkunen Francis Kessler Bernd Waas Costas Papadimitriou Tamás Gyulavári Leifur Gunnarsson Ireland Anthony Kerr Edoardo Ales Kristine Dupate Wolfgang Portmann Tomas Davulis Luxemburg Jean-Luc Putz Lorna Mifsud Cachia Hanneke Bennaars Suzanne Kali Marianne Jenum Hotvedt Alexander Næss Skjønberg Leszek Mitrus José João Abrantes Rita Canas da Silva Raluca Dimitriu Robert Schronk Barbara Kresal Joaquín García-Murcia Iván Antonio Rodríguez Cardo Andreas Inghammar Catherine Barnard

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Table of Contents Executive Summary ...... 1

Austria ...... 8 1 National Legislation ...... 8 2 Court Rulings ...... 10 3 Implications of Rulings of the CJEU and the ECHR ...... 10 4 Other Relevant Information ...... 12

Belgium ...... 13 1 National Legislation ...... 13 2 Court Rulings ...... 16 3 Implications of CJEU Rulings and ECHR ...... 17 4 Other Relevant Information ...... 20

Bulgaria ...... 21 1 National Legislation ...... 21 2 Court Rulings ...... 21 3 Implications of CJEU Rulings and ECHR ...... 21 4 Other Relevant Information ...... 21

Croatia ...... 22 1 National Legislation ...... 22 2 Court Rulings ...... 23 3 Implication of CJEU Rulings and ECHR ...... 23 4 Other Relevant Information ...... 24

Cyprus ...... 25 1 National Legislation ...... 25 2 Court Rulings ...... 27 3 Implications of CJEU Rulings and ECHR ...... 28 4 Other Relevant Information ...... 31

Czech Republic ...... 32 1 National Legislation ...... 32 2 Court Rulings ...... 40 3 Implications of CJEU Rulings and ECHR ...... 40 4 Other Relevant Information ...... 41

Denmark ...... 42 1 National Legislation ...... 42 2 Court Rulings ...... 43 3 Implications of CJEU Rulings and ECHR ...... 44 4 Other Relevant Information ...... 45

Estonia ...... 46 1 National Legislation ...... 46 2 Court Rulings ...... 47

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3 Implications of CJEU Rulings and ECHR ...... 47 4 Other Relevant Information ...... 47

Finland ...... 49 1 National Legislation ...... 49 2 Court Rulings ...... 50 3 Implications of CJEU Rulings and ECHR ...... 50 4 Other Relevant Information ...... 51

France ...... 52 1 National Legislation ...... 52 2 Court Rulings ...... 57 3 Implications of CJEU Rulings and ECHR ...... 57 4 Other Relevant Information ...... 59

Germany ...... 62 1 National Legislation ...... 62 2 Court Rulings ...... 63 3 Implications of CJEU Rulings and ECHR ...... 64 4 Other Relevant Information ...... 64

Greece ...... 65 1 National Legislation ...... 65 2 Court Rulings ...... 65 3 Implications of CJEU Rulings and ECHR ...... 65 4 Other Relevant Information ...... 66

Hungary ...... 67 1 National Legislation ...... 67 2 Court Rulings ...... 68 3 Implications of CJEU Rulings and ECHR ...... 69 4 Other Relevant Information ...... 70

Iceland ...... 71 1 National Legislation ...... 71 2 Court Rulings ...... 72 3 Implications of CJEU Rulings and ECHR ...... 72 4 Other Relevant Information ...... 72

Ireland ...... 75 1 National Legislation ...... 73 2 Court Rulings ...... 74 3 Implications of CJEU Rulings and ECHR ...... 74 4 Other Relevant Information ...... 75

Italy . ……………………………………………………………………………………………………………………………..76 1 National Legislation ...... 76 2 Court Rulings ...... 78 3 Implications of CJEU Rulings and ECHR ...... 78 4 Other Relevant Information ...... 79

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Latvia ...... 80 1 National Legislation ...... 80 2 Court Rulings ...... 81 3 Implications of CJEU Rulings and ECHR ...... 81 4 Other Relevant Information ...... 81

Liechtenstein ...... 82 1 National Legislation ...... 82 2 Court Rulings ...... 84 3 Implications of CJEU Rulings and ECHR ...... 84 4 Other Relevant Information ...... 84

Lithuania ...... 85 1 National Legislation ...... 85 2 Court Rulings ...... 85 3 Implications of CJEU Rulings and ECHR ...... 85 4 Other Relevant Information ...... 86

Luxembourg ...... 87 1 National Legislation ...... 87 2 Court Rulings ...... 90 3 Implications of CJEU Rulings and ECHR ...... 91 4 Other Relevant Information ...... 91

Malta ...... 92 1 National Legislation ...... 92 2 Court Rulings ...... 92 3 Implications of CJEU Rulings and ECHR ...... 92 4 Other Relevant Information ...... 94

Netherlands ...... 95 1 National Legislation ...... 95 2 Court Rulings ...... 96 3 Implications of CJEU Rulings and ECHR ...... 97 4 Other Relevant Information ...... 98

Norway ...... 99 1 National Legislation ...... 99 2 Court Rulings ...... 100 3 Implications of CJEU Rulings and ECHR ...... 100 4 Other Relevant Information ...... 102

Poland ...... 103 1 National Legislation ...... 103 2 Court Rulings ...... 104 3 Implications of CJEU Rulings and ECHR ...... 104 4 Other Relevant Information ...... 105

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Portugal ...... 106 1 National Legislation ...... 106 2 Court Rulings ...... 110 3 Implications of CJEU Rulings and ECHR ...... 110 4 Other Relevant Information ...... 113

Romania ...... 114 1 National Legislation ...... 114 2 Court Rulings ...... 116 3 Implications of CJEU Rulings and ECHR ...... 116 4 Other Relevant Information ...... 117

Slovakia ...... 118 1 National Legislation ...... 118 2 Court Rulings ...... 120 3 Implications of CJEU Rulings and ECHR ...... 120 4 Other Relevant Information ...... 122

Slovenia ...... 123 1 National Legislation ...... 123 2 Court Rulings ...... 126 3 Implications of CJEU Rulings and ECHR ...... 126 4 Other Relevant Information ...... 130

Spain….………………………………………………………………………………………………………………………..133 1 National Legislation ...... 131 2 Court Rulings ...... 135 3 Implications of CJEU Rulings and ECHR ...... 135 4 Other Relevant Information ...... 136

Sweden ...... 137 1 National Legislation ...... 137 2 Court Rulings ...... 137 3 Implications of CJEU Rulings and ECHR ...... 137 4 Other Relevant Information ...... 138

United Kingdom ...... 139 1 National Legislation ...... 139 2 Court Rulings ...... 139 3 Implications of CJEU Rulings and ECHR ...... 140 4 Other Relevant Information ...... 140

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New health and safety standards for Executive Summary workplaces have been enacted in Germany, Portugal, and Romania, and National level developments the application of previously introduced In May 2020, extraordinary measures measures has been extended e.g. in triggered by the COVID-19 crisis still Austria and Liechtenstein. Existing dominated the developments of labour law provisions have been further clarified in in most but not all of the Member States France, whereas the application of and (EEA) temporary measures has been terminated . in Slovenia. Countries such as Denmark and Portugal have passed legislation to This summary is therefore divided into an prevent vulnerable employees from overview of developments relating to the exposure at the workplace. crisis measures, and a second part summing other labour law developments with particular relevance for the transposition of EU labour law. Measures to alleviate the financial consequences for Developments related to businesses and workers the COVID-19 crisis State-supported short-time work or Measures to diminish the risk of equivalent schemes remain in place in many countries. Previously enacted infection in the workplace temporary schemes have been renewed or All countries still have measures in place extended in Estonia, France, Romania to prevent the spread of the virus in and Spain and further clarified in France workplaces. Most frequently, mandatory and Luxembourg. Such schemes have restrictions of business activity are been newly initiated in Greece and combined with calls to use options such as Slovenia, expanded in scope in Belgium work from home as far as possible. and Iceland, and partly amended in Previously enacted extraordinary Austria. Programmes providing financial measures have been temporarily extended benefits for workers and/or self-employed in countries such as Bulgaria, the Czech persons have been launched in Denmark, Republic, France, Norway, Portugal, Italy, Portugal, and previously Luxembourg, and Spain, whereas an commenced schemes have been easing of such measures in various areas temporarily extended in Denmark, is reported for a number of countries Ireland, the Netherlands and Spain. (Croatia, Cyprus, Denmark, Ireland, The coverage of such support schemes has Italy, Luxembourg, the Netherlands, been enhanced in Italy, Poland, and the Norway, Romania, Slovenia, Spain). In UK, and clarified in Portugal. Subsidies to Luxembourg, a list of measures for employers have been introduced in “post-crisis preparation” has been Iceland, and made more comprehensive published. In Cyprus, the decision in Croatia, the , Italy requiring vulnerable groups to return to and Slovenia. The duration of the existing work is being criticised for having been scheme has been extended in the taken without consultation or warning and Netherlands, and plans to make the potentially violating labour and children system more inclusive exist in Ireland. rights. In Croatia, new employment in public Measures to facilitate work from home sector has been prohibited. were introduced in Latvia, and clarified in A deferral of social security contribution Ireland. payments has been granted in Belgium, and in the Czech Republic, the penalties for non-payment of social security contributions have been reduced significantly. In Croatia, a new law ensures the protection of employees in the

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event of employer insolvency, despite the inclusion income, and Spain has newly new rules in place to protect debtors. introduced an entitlement to ‘minimum living income’. To tackle the In Croatia, employers who receive public crisis, Romania and subsidies are prohibited from dismissing Spain have introduced incentives for employees. By contrast, in Portugal, hiring jobseekers. rules on simplified layoffs have been temporarily extended, while the Authority for Work Conditions’ powers to suspend potentially unlawful dismissals have also Measures to ensure the been enhanced. performance of essential work In Denmark, Parliament has adopted a Previously enacted rules to ensure that whistleblower scheme specifically to avoid essential tasks in areas such as health fraud involving the state financed care, public administration and services emergency measures. In Luxembourg, can be performed remain in place in many specific measures aim to curtail fraud and countries. Beyond that, Luxembourg has abuse in relation to short-time work. passed amendments to facilitate work by students. In Poland, certain social protection workers have been exempt Leave entitlements and social from compulsory quarantine measures. In security Italy and Spain, the employment of foreigners has been facilitated, notably for Special rules on entitlements to family- agricultural (in Italy also domestic) work. and care-related leave and sick leave Spain has enacted a temporary general continue to apply in many countries. In extension of work permits. May, care-related leave rights were The suspension of introduced in Belgium and extended in restrictions for certain groups of essential Norway, but downgraded in workers remain in place in several Luxembourg. Rights to allowances for countries. New rules introducing such such leave have been created in the Czech measures have been passed in Finland, Republic and extended in Italy. The Liechtenstein and Portugal, whereas duration of sick leave schemes for persons previous measures have been partially in quarantine were extended in Iceland, discontinued in Luxembourg. and leave entitlements and benefits for vulnerable persons have been introduced in Austria and Cyprus. Other amendments improving sickness benefit Suspension and changes of entitlements have been made in Ireland time limits and Norway. In France, dismissal In France, elections for employee protection for workers on leave has been representative bodies have been deferred improved. and the mandate of incumbent Spain has enacted rules to cover COVID- representatives extended. Various 19 infections as an industrial injury, even deadlines in relation to tripartite if they emerge after expiry of the state of consultations have been amended emergency. temporarily. In Luxembourg, time limits for apprenticeship contracts have been Unemployment benefit schemes have suspended, and the same is valid for been temporarily amended to facilitate measures such as verification and training access to benefits in Italy, to ensure employees’ fulfilment of Liechtenstein, Portugal and Slovakia. qualification requirements in the Czech The Italian measure specifically focusses Republic. The validity of collective on enabling seasonal agricultural work agreements has been generally extended without a loss of entitlement to in Romania. unemployment insurance benefits; the Spanish rule focusses on artists. Portugal has simplified access to social

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Reduction of employee protection Hungary continues to stand out for introducing the most far-reaching derogations from labour law, many of which are applicable to all workers for the duration of the state of emergency. Apart from the measures reported in March, all employers have been entitled to unilaterally order a reference period for working time of up to 24 months. Football clubs can unilaterally cut their players’ pay by up to 70 per cent.

In other countries, measures that reduce employee protection to help employers deal with the crisis are more limited, entailing e.g. a possibility to order employees to use up their entitlements, as has been introduced in Slovakia in April. In Poland, employers in the public sector now have extended possibilities to terminate employment relationships or reduce remuneration.

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Table 1: developments related to measures to the COVID-19 crisis

Topic Countries

Restriction of business activity by CY CZ DK ES FR HR IE IT LU NL NO PT RO SI lockdown measures Short-time work / technical employment AT BE EE EL ES FR IS LU NO RO SI Health and safety measures AT DE DK FR LI PT RO SI Family / BE CZ IT LU NO PT RO SK Benefits for workers / self-employed DK ES IE IT NL PL PT UK prevented from working Employer subsidies CZ HR IE IS IT NL SI Sick leave for quarantine and vulnerable AT CY FR IE IS NO persons Unemployment benefits ES IT LI PT SI Enhanced sick leave entitlement DE EE FR LU Working time (essential workers) FI LI LU PT Deferral of contributions payment / BE CZ HR reduced penalties Dismissal HR PL PT Measures against fraud and abuse DK LU Eased restrictions for foreign workers ES IT Social assistance ES PT Incentives for hiring ES RO Unilateral changes of contractual HU LV arrangements by employers Telework / work from home LV IE Deferral of qualification assurance CZ procedures Coverage by industrial injury insurance ES Suspension of periods for consultation of FR workers’ representatives of public sector employment HR Eased restrictions for fixed-term IT contracts Eased restrictions for work by students LU Exemption of essential workers from PL quarantine Extended application of collective RO agreements

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Other developments amendment changed and clarified the notion and scope of the The following developments from March transfer of an undertaking, as well as to May 2020 were particularly relevant rules on terminations of employment in from an EU law perspective: this case. In Denmark, the Labour Court referred to CJEU rulings in cases Süzen and CLECE when ruling in a case Free movement and posting of on a possible transfer of undertaking workers concerning cleaning companies. in Germany, the Federal Labour Court In Belgium, a law passed in April found that no transfer of an undertaking introduces three temporary crisis had taken place with regard to the so- measures in favour of employers and called ‘wet lease’. In the Netherlands, their employees who are facing the Supreme Court referred several economic difficulties in the case of a ‘no questions on the application of the rules deal Brexit’ at the end of the transitional on transfers of undertakings in the period. In May, the Federal Parliament context of a pre-packaged insolvency adopted a law transposing Directive sale (‘pre-pack’) to the CJEU. In 2018/957/EU. In the Czech Republic, Norway, the Supreme Court relied on Latvia, and Norway, implementation the judgment of the CJEU in Collino and measures for Directive 2018/957/EU on Chiappero, C-343/98, to find that a civil the posting of workers are being servant who had been working for a prepared. In Germany, an amendment commercial undertaking of the concerns the application of collective was not covered by agreements to posted workers. Directive 2001/23/EC.

Atypical employment Data protection In Cyprus, unions have raised questions In Austria, a Supreme Court ruling of about the compatibility of an March 2020 found a GPS tracking amendment changing the status of system to be illegal in the absence of the public sector employees with the employee’s consent. In Denmark, the principle of equal treatment between Supreme Court ruled in March 2020 that fixed-term and permanent employees an employer had not presented fair or stipulated in the Directive 1999/70/EC. proportionate reasons for applying TV In Lithuania, amendments to the surveillance to its employees. In Labour Code contain i.a. stricter Iceland, a reform of March 2020 requirements for registration as a clarified the confidentiality obligation of temporary work agency, and the data protection officers. reintroduction of the possibility to conclude an unlimited number of fixed- term contracts for posts which, in Working time accordance with legal provisions, should be filled by way of public competition. At In the Czech Republic, a Labour Code least the latter amendment is amendment provides for a calculation of considered potentially problematic with annual leave entitlements in hours a view to Directive 1999/70/EC. rather than days. In Finland, two Labour Court rulings of March 2020

involving fire fighters and emergency Transfer of undertaking medical technicians who had to remain at or close to their place of work during In the Czech Republic, the Supreme standby time found that these periods Court identified criteria for determining should be considered working time. In a ‘significant deterioration of working Germany, a Higher Administrative conditions’ in connection with transfers Court ruling of March 2020 found of undertakings in April 2020. In May, a

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firefighters to be entitled to WLB; transparent and compensation for standby periods. In predictable working Hungary, the Constitutional Court issued an important decision prohibiting conditions the overlap of daily and weekly rest In Croatia, compensation during periods. In Ireland, a fire fighter’s claim parental leave was extended by a reform to have stand-by time recognised as of March 2020. In the Czech Republic, working time was rejected by the Labour requirements for the delivery of Court in March 2020. in Luxembourg, documents to employees have been a law on working time in agriculture was specified in a new Act. In Latvia, passed in March 2020. Parliament has started working on the adoption of amendments to implement rules on transparent and predictable employment conditions and telework.

Table 2: Other main developments

Topic Countries

Working time DE EE FI HU IE LU Transfer of undertaking CZ DK DE NL NO Posting of workers CZ DE LV NO Data protection AT DK IS Public servants CY HR SK Fixed-term work CY LT Dismissal IS SE Brexit BE Strike BE Annual leave CZ Employee information CZ Industrial injury compensation CZ Shared work CZ Penalties EE Collective bargaining HR Parental leave HR Temporary agency work LT Telework LV Transparent/predictable working LV conditions Independent contractors NL Health and safety NO Non-competition clauses NO

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CJEU case C-344/18, 26 March 2020, Implications of CJEU ISS Facility Services Rulings As regards this decision, most Transfer of undertaking countries’ national laws and case laws do not contradict the interpretation of This FR analyses the implications of two implementing provisions in accordance CJEU rulings relating to the transfer of with the CJEU’s findings. Questions an undertaking. about divided responsibilities of employers have hardly come up in previous case law in any national CJEU case C-298/18  Grafe and Pohle, system. In Norway, the courts are 27 February 2020 expected to interpret national law in line The clear majority of national reports with this judgment despite difficulties to indicate that the judgment’s align it with the wording of the interpretation of the concept of transfer implementation provisions. of an undertaking does not seem to However, in Bulgaria and the Czech contradict national provisions or prior Republic, current law seems to only case law. Hence, the importance of the provide for the possibility of transferring judgment lies mainly in the impact it one employee to one specific employer. may have on the future interpretation of Legal uncertainties regarding whether a national law since domestic courts will division of the employer’s position could need to take the interpretation into be taken into account as a deterioration account. of the working conditions under national By contrast, in Germany, certain law exist in Austria. The differences to existing national case law implementation of the judgment is also are mentioned. In Greece, expected to be ‘problematic’ in contradictory judgments have been Lithuania. In Croatia, rules on issued regarding similar cases in the workers’ rights in case of a deterioration past. In Romania, the decision may of working conditions have generally not possibly make legislative amendments been implemented. necessary to ensure a broader concept In Germany, academic literature has of transfer of an undertaking. criticised the judgment for producing practical problems and legal uncertainties.

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Austria

Summary Short-time work legislation has been amended to simplify its administration, the option of COVID-19 risk certificates for employees have been extended to employees in critical infrastructure. ______1 National Legislation 1.1 Measures to respond to COVID-19 crisis The Austrian Parliament has amended legislation to facilitate the administration of short- time work. The protection of members of risk groups from exposure to COVID-19 has been extended and amended to include employees in critical infrastructure as well. The Austrian government has generally continued the step-by-step approach to return to a more ‘normal’ life. Even the obligation to wear masks in shops is being reduced.

1.1.1 Short-time work Following the speedy introduction of COVID-19 short-time work in March 2020, the social partners and the Labour Market Services faced several practical and legal uncertainties. To clarify some of these legal uncertainties, the law on which COVID-19 Short Time Work is based (Act on Labour Market Services, Arbeitsmarktservicegesetz/ AMSG, 67/BNR) has been amended. Also, a new short-time work template agreement for any short-time work entered into from 01 May onwards, as well as for any short-time work that is extended for more than three months, has been drafted and released by the social partners. The administration of requests for short-time work funding has improved. One specific issue has been the monthly payments that employers are required to forward to their employees. The aim of the amendment of the law is to facilitate the administrative process throughout the period of short-time work. § 37b (6) AMSG reads as follows (unofficial translation by the author): “Insofar as the agreement pursuant to para. 1 No. 3 guarantees a minimum net remuneration corresponding to a net replacement rate guaranteed in the directive pursuant to para. 4, the employer fulfils the agreement and directive if the employees concerned are paid the reduced gross remuneration during short-time work, which is to be determined for the gross remuneration due before short-time work in each case by analogy with the flat rates of the AMS - even above the maximum contribution basis. The minimum wage to be guaranteed may relate either to the total wage or to the hours lost and supported by the short-time work allowance. It may relate to individual months or an average consideration during the short- time working period. In any event, the minimum gross remuneration to be paid each month is that which results from the short-time work minimum gross remuneration table. The short- time work minimum gross remuneration table must contain a gradation of the amounts in steps of five each. The short-time work minimum gross remuneration table is to be published by the Federal Minister of Labour, Family and Youth on the homepage of the Federal Ministry of Labour, Family and Youth.” The Act now clearly states that employers fulfil their legal obligation if they pay the reduced gross remuneration based on the funding guidelines on short-time work. Nonetheless, even though employers must generally ensure that employees receive their 80/85/90 per cent net rate throughout the period of short-time work, employees are entitled to 100 per cent of their remuneration for days of paid leave (if taken throughout the period of short-time work) and to remuneration exceeding the 80/85/90

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per cent net rate if their income for the actual hours worked would in fact exceed the net rate, as this is part of the Agreement on Short Time Work, and the funding guidelines. The calculation for net rates is amended, and now a much more accurate calculation exists, as it is based on a gradation of five euros each, instead of previously fifty euros. A legal basis for the obligation to maintain the number of employees during short-time work has been added in § 37b Abs 2 AMSG: “The agreement must ensure, at least with regard to the number of employees covered by short-time work, that the number of employees is maintained during the period of short-time work and in any additionally agreed period after its termination, unless the regional office of the Labour Market Service grants an exception in special cases.” All documents for funding/calculation, etc. on short time work are available here.

1.1.2 COVID-19 Risk Certificate As indicated in the April 2020 Flash Report, legislation on COVID-19 risk certificates for employees has been amended to extend the right to exemption from work, at least until 31 May 2020 (with the possibility of an extension until 31 ), and to include employees who work in critical infrastructure. The amendment (§ 735 Act on General Social Security, BGBl. I, No. 31/2020) passed the Federal Assembly on 04 May. Also, an administrative degree on the definition of risk groups was issued on 06 May. The amended § 735 ASVG on the COVID-19 Risk Certificate reads as follows: “(3) If a person concerned submits a COVID-19 risk assessment to his employer, he shall be entitled to exemption from work and continued payment of remuneration, except 1.if the person concerned can perform his or her work from home (home office) or 2. if the conditions for the performance of his work at the workplace can be designed based on the appropriate measures in such a way that infection of other workers with COVID-19 is excluded to the greatest possible extent; in this context, measures for travel to work must also be included. [...] The exemption may last until 30 April 2020 at the latest. If the COVID-19 crisis continues beyond 30 April 2020, the Federal Minister of Labour, Family and Youth, in agreement with the Federal Minister of Social Affairs, Health, Care and Consumer Protection, shall extend by ordinance the period during which such exemption is possible, but no later than 31 December 2020. [...] (5) The employer, [...], shall be entitled to reimbursement by the health insurance institution of the remuneration paid to the employee or apprentice as well as the employer's share of the social security contribution, unemployment insurance contribution and other contributions. The application for reimbursement must be submitted to the health insurance institution no later than six weeks after the end of the leave of absence. The Federal Government must reimburse the sickness insurance institution for the resulting expenses.” A FAQ on the COVID-19 risk certificates by the Ministry of Social Affairs is available here.

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1.2 Other legislative developments Nothing to report.

2 Court Rulings Nothing to report.

3 Implications of Rulings of the CJEU and the ECHR 3.1 Transfer of undertakings CJEU case C-298/18, Grafe und Pohle, 27 February 2020 In this decision, the CJEU dealt with a case of transfer of the operation of a bus route similar to a previous ruling Liikenne (C-172/99) and carved out the differences between the facts of the two cases. While it considered the transfer of the busses to be of essence in the Liikenne case it was pointed out in the Grafe case that this was not the case as the busses, due to legal, environmental and technical constraints imposed by the contracting authority, were not transferred. Therefore, not taking over those resources cannot necessarily preclude the classification of the takeover of an activity as a transfer of an undertaking since other factual circumstances, such as the taking over of the majority of employees and the pursuit, without interruption, of that activity, make it possible to establish that the identity of the economic entity concerned has been retained and that a transfer of an undertaking has taken place. To our knowledge, the Austrian Supreme Court has not yet ruled on a case similar to the CJEU’s Liikenne case, although it has generally been referred to in a number of cases, for example, recently by the Supreme Court on 19 December 2016, 9 Ob A 136/16i: “In these cases, a (partial) transfer of an undertaking exists if either the new contractor has taken over a substantial part of the workforce in terms of numbers and expertise (ECJ 11. 4. 1997, C-13/95 Süzen; ECJ 15. 12. 2005, C-232/04, C- 233/04 Nurten-Güney-Görres and Gul Demir) or in sectors where human labour is not essential because the activity requires a significant amount of materials and equipment, the second contractor uses the essential material and non- material resources previously used by the first contractor and made available successively by the contracting authority to the first and second contractor (CJEU 20. 11. 2003, C-340/01 Abler, para 36; ECJ 25. 1. 2001, C-172/99 Oy Liikenne, para 39; 8 ObA 122/03d; 9 ObA 119/14m).” The Liikenne case itself has been referred to in the legal literature as well (e.g. Kietaibl, Betriebsübergang und Vergaberecht, JAS 2018, 1 [3]) and it has often been mentioned that a transfer of a business can be avoided by not taking over essential material assets. The Grafe case now relativizes this rather general statement and puts this element into perspective. Not taking over substantial operational resources lose their importance if there is a reason for it imposed by the contracting authority. As there have not been any published decisions by the Austrian courts that deal with cases similar to the CJEU’s Grafe case, yet the decision will have limited implications for Austrian labour law and court practice besides possibly shaping future rulings in such cases if they arise.

CJEU case C-344/18, ISS Facility Services, 26 March 2020

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This is an extremely important ruling as an employee may now have not only one employer but a number of employers after a transfer of an undertaking. The CJEU states a number of prerequisites, however: the division of the contract of employment as a result of the transfer must be possible and may not cause a deterioration of working conditions nor adversely affect the safeguarding of the workers’ rights guaranteed in the Directive and the national laws transposing it. If such a division were impossible to carry out or if it adversely affected the rights of that worker, the transferee(s) would be regarded as being responsible for any consequent termination of the employment relationship under Article 4 of that Directive, even if that termination were to be initiated by the worker. To our knowledge, there have not been any published decisions by Austrian courts that deal with similar cases. The discussions on ‘partial transfers of an employment relationship’ dealt with cases of employees working in different entities in an enterprise where only one of the entities was transferred (see Risak, Die Zuordnung von Arbeitsverhältnissen zum übergehenden Betrieb – Betriebsteil, ZAS 2001, 44). Pursuant to the ECJ’s decision of 7.2.1985, 986/83, Botzen and the following ones (C-209/91, Rask; C-362/89, d'Urso), this was a theoretical discussion, though as it was always emphasised that an employee must be ‘employed in the transferred part of the undertaking’, i.e. be organisationally integrated in it, and not only whilst being employed in an administrative department of the undertaking which has not itself been transferred, carried out certain duties for the benefit of the part transferred (see also Supreme Court of 28 August 1997, 8 Ob A 91/97h). In the mentioned article (Risak, ZAS 2001, 44), the author proposed to not divide the employment relationship but to examine whether the part of the undertaking the employee was predominantly employed in was transferred or not. If this could not be established, no transfer has taken place. This discussion was not taken up in the last 20 years, as there have not been any practical cases. Now with the ISS-decision, there is at least some guidance if such a case does arise. For the Austrian context, one issue remains, however, as the transposition of Article 4 (2) of Directive 2001/23/EC only covers the case of deterioration of the working conditions due to a change in the applicable collective bargaining agreement or works agreement (§ 3 (5) Act on the Adaption of Employment Law – Arbeitsvertragsrechtsanpassungsgesetz – AVRAG): “If working conditions substantially deteriorate based on the collective agreement or works agreement applicable after the transfer of the undertaking, the employee may terminate the employment relationship within one month of the date on which he/she became aware or should have become aware of the deterioration in working conditions, in compliance with the periods and dates of notice provided for by law or collective agreements. The employee is entitled to the rights due at the time of such a termination of employment as if the employer had terminated the employment.” (unofficial translation by the author) The Austrian legislator obviously assumed that a change in working conditions to the detriment of the employee could only occur if the collective bargaining agreement or works agreement changes, as the contractual provisions have to be maintained. The case of a division of the employer’s position due to a transfer to several transferees was not part of the deliberations. It is possible, therefore, to apply this provision by way of analogy to the case of deteriorating working conditions due to the multiplicity of transferees, as a lacuna legis exists in this respect. It is very likely that Austrian courts would take this avenue to interpret Austrian legislation in line with the jurisprudence of the CJEU.

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4 Other Relevant Information Nothing to report.

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Flash Report 05/2020

Belgium

Summary (I) In the context of the Belgian exit strategy and the easing of the measures against the spread of COVID-19, many adjustments were made. A Special Powers Decree temporarily provides for the possibility of corona parental leave. The degressivity in time of full unemployment benefits has been temporarily frozen. The days of temporary unemployment caused by the COVID-19 virus are considered as days worked for the purpose of determining the length of annual leave. A royal decree grants a postponement of payment of mandatory social security contributions until 15 December 2020. (II) In case of a ‘no deal Brexit’ at the end of the transitional period, three temporary crisis measures consist of individual or collective working time reduction and a special scheme for temporary unemployment benefits. (III) The Belgian Constitutional Court has dismissed the for annulment of the rules on the continuity of service in rail passenger transport in the event of a strike. (IV) A law on untaxed additional work has been annulled by the Constitutional Court. (V) The Federal Parliament adopted a law transposing Directive 2018/957/EU. ______1 National Legislation 1.1 Measures to respond to COVID-19 crisis This Flash Report focusses on the corona crisis in Belgium during the month of May 2020 and its impact on the employment of employees.

1.1.1 Safety at work In the context of the Belgian exit strategy and the relaxation of measures against the spread of COVID-19, many adjustments were made in a relatively short period of time to the original Ministerial Decree of 23 March 2020 on urgent measures to fight the spread of the COVID-19 virus. This decree has been amended by the Ministerial Decrees of 30 April, 08 May, 15 May, 20 May, 25 May, 30 May and 05 June. From 30 April onwards, this Ministerial Decree refers to the "phased approach for phasing out the measures", i.e. the exit strategy. The main new measure is the recommendation—no longer the obligation—to offer teleworking for functions that allow this. As a result of this more flexible provision, which cautiously aims at a return to work, there was a need for some obligations to take preventive measures to protect the health and safety of workers. As part of one of these measures, the Ministerial Decree refers to the 'Generic Guidelines against the spread of COVID-19', elaborated by the Supreme Council for the Prevention and Protection at Work. For example, Article 2 of this Ministerial Decree provides that non-essential enterprises are required to take appropriate preventive measures in good time. However, this Ministerial Decree differentiates enterprises in critical sectors and essential services. The latter, if they have not interrupted their activities, may use the Generic Guidelines as a "source of inspiration".

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1.1.2 Parental Leave The Law of 27 March 2020 ‘Covid II’ authorises the King to make adjustments to labour law with a view to proper organisation of businesses and the continuity of critical sectors. In implementation thereof, the special powers Royal Decree ‘Corona parental leave’ - The Special Powers Decree No. 23 of 13 May 2020 has been published in the Belgian Official Gazette (Moniteur belge). Employees who are able to reduce their working hours under parental leave shall be eligible for corona parental leave for the period from 01 May 2020 to 30 June 2020. Subject to the special provisions of the Royal Decree of 13 May 2020, the rules on ordinary parental leave shall also apply to corona parental leave. Foster parents may also make use of corona parental leave. To have access to corona parental leave, the child on the basis of which the leave is taken, may, in principle, not be older than 12 years of age, with the exception of disabled children. The employee must also have been employed for at least one month. The leave can only be taken with the employer’s agreement. As a result of corona parental leave, working hours can be reduced by either 1/2th or 1/5th of the normal number of working hours of a full-time job. In addition, corona parental leave may also be taken in the form of a reduction in work performance to 1/2th, by a worker employed in a part-time employment scheme, amounting to at least three quarters of a full-time job. For the period of corona parental leave, an allowance is provided, which is 25 per cent higher than the allowance in case of parental leave. Employees who have already taken parental leave, where their performance has been reduced by 1/5th or 1/2th, may, with the employer's consent, convert this into corona parental leave. The period of parental leave or career break that is converted into corona parental leave shall not be taken into account for the maximum duration of this parental leave or career break. In the case of corona parental leave, there is a specific dismissal protection as in the case of the employee on ordinary parental leave.

1.1.3 Unemployment benefits The Royal Decree 23 April 2020 to temporarily relax the conditions under which unemployed persons can be employed in essential sectors has been frozen for three months and the degressivity of the amount of unemployment benefits has been frozen depending on the duration of unemployment (Moniteur belge, 30 April 2020).

1.1.4 Annual leave and temporary unemployment In the Belgian legal holiday scheme, the duration of the holiday and holiday pay are calculated, taking into account the days worked in the calendar year preceding the year in which the holiday is granted. Not only the number of ‘days of normal actual work’ in the holiday scheme year is taken into account, but also a number of ‘days of work interruption equivalent to days actually worked’. The Royal Decree of 04 June 2000 assimilating the days of inactivity because of temporary unemployment due to force majeure caused by the COVID-19 pandemic (Moniteur belge, 05 June 2020), now provides that days on which work was interrupted as a result of temporary unemployment due to force majeure caused by the coronavirus pandemic are assimilated to days actually worked. This assimilation is provided for the period from 01 February 2020 to 30 June 2020.

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As a result, employees who were temporarily unemployed during that period due to force majeure will not lose any holidays in 2021, nor will they have less holiday pay. Given that an extension of the scheme for temporary unemployment due to force majeure because of corona until 31 August 2020 is in the pipeline, it does not seem excluded that the assimilation period may also be extended.

1.1.5 Social security contributions Royal Decree No. 17 of 04 May 2020 implementing the Law of 27 March 2020 (Moniteur belge, 12 May 2020) grants a postponement of payment of the social security contributions until 15 December 2020 for amounts owed to the National Social Security Office. Although the Royal Decree was only published on 12 May 2020, it is effective as of 20 March 2020.

1.2 Other legislative developments 1.2.1 Brexit With the Law of 06 March 2020 on the safeguarding of employment following the United Kingdom's withdrawal from the European Union (Moniteur belge, 25 March 2020), the Belgian federal legislator introduced three temporary crisis measures in favour of employees and their employers in certain economic difficulties caused by Brexit. An important clarification of these measures is that they have not yet entered into force and can only be applied in the case of a ‘no deal Brexit’ at the end of the transitional period provided for in the ‘withdrawal agreement’. The circumstances of economic difficulties must be recognised by the Minister of Labour, and in particular, it must be shown that the turnover, production or orders have dropped by at least 5 per cent as a result of the United Kingdom's withdrawal from the European Union. To qualify for the beneficiary measures, the employer must be bound by a sectoral collective bargaining agreement or, in the absence thereof, by a collective bargaining agreement at company level. The employer who fulfils all of the conditions can benefit from three temporary crisis measures: 1. A special scheme for temporary unemployment, whereby the performance of the employment contract is suspended altogether or working time is reduced. However, the employer must pay a supplement to the unemployment benefit of at least EUR 5.63 per day not worked; 2. A temporary reduction in individual working time by 1/5th or up to half-time employment for a period not less than one month and not exceeding six months. This agreement between the parties must be formalised in an agreement between the employer and the employee; 3. A temporary adjustment of the working time in the company, in particular a reduction of one quarter or one-fifth of the working time. This adaptation must be carried out via a company collective bargaining agreement or, if there is no trade union delegation, via an amendment to the work rules at company level.

1.2.2 Posting of workers On 28 May, the Belgian Parliament adopted a law transposing Directive 2018/957/EU, amending Directive 96/71/EC concerning the posting of workers in the framework of the

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provision of services (Memory of Understanding, Parl. Documents, Chamber of Representatives, 2019-2020, No. 55-1173/001). Directive 2018/957 must be transposed before 30 July 2020. The law amends the Law of 05 March 2002 on working, pay and employment conditions in the event of the posting of workers in Belgium and compliance with it, taking account of the extension introduced by Directive 2018/957/EU to the hard core of mandatory provisions on minimum protection of Directive 96/71/EC. The law also regulates the application of the Belgian sectoral provisions providing for allowances or reimbursement of travel, meal and subsistence expenses for workers who are away from home on a professional basis. The law introduces in the Law of 05 March 2002 provisions providing for the application of a more extensive package of Belgian working conditions when the duration of the posting exceeds 12 months. In addition, the law amends the Law of 24 July 1987 on temporary agency work and the posting of workers to create information obligations under criminal law for users of posted workers who are established in Belgium, in particular information on the working conditions applicable to posted temporary workers and information on the place of posting when the user employs the workers posted to a country other than Belgium. The law also creates a mechanism that reduces the penalties for non-compliance with the applicable Belgian working and employment conditions in the case of posting, if the only official website in Belgium does not mention these working and employment conditions.

2 Court Rulings 2.1 Strikes Constitutional Court, No. 67/2020, 14 May 2020 The Belgian Constitutional Court on 14 May 2020, No. 67/2020 has dismissed the action for annulment of the trade unions of the Law of 29 November 2017, introducing a new Chapter 'Continuity of service in rail passenger transport in the event of a strike' in the legislation. The law does not infringe the right to strike. The new legal system is based on voluntariness and the prohibition of strike pickets to block the tracks. In case of strike, the Belgian railways can only schedule a plan of minimum services to transport passengers to the extent that there are volunteers among the railway staff who want to work during the strike. The Constitutional Court does not agree with the trade unions' view that the system would constitute a minimum service, for which, among others, the ILO has laid down specific conditions. However, the Belgian Constitutional Court acknowledged that imposing a disciplinary sanction on staff members who do not express their intention not to participate in the strike (and therefore to come to work) is illegal.

2.2 Income tax Constitutional Court, No. 53/2020, 23 April 2020 The Constitutional Court on 23 April 2020 (No. 53/2020) nullified the entire regulation on untaxed additional income from 18 July 2018 (see August 2018 Flash Report). The law developed an advantageous scheme for association work, but also for 'occasional services between citizens' and services provided via recognised electronic subplatforms. Under the new statute, people can earn up to EUR 6 000 per year untaxed in addition to their main activity (as an employee, self-employed or retired person). From the

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outset, the scheme was highly controversial. The Constitutional Court is of the opinion that the regulation of untaxed additional income does not pass the of the principle of equality and non-discrimination. After all, persons can carry out the same activities in these articles of association as in the status of employee or self-employed person. In doing so, 'auxiliary persons' are treated differently in the field of taxation, social security and employment legislation, without there being any reasonable justification for this. However, the nullification will only take effect from 2021 onwards.

3 Implications of CJEU Rulings and ECHR 3.1 Transfer of undertakings CJEU case C-298/18, Grafe und Pohle, 27 February 2020 Südbrandenburger Nahverkehrs (hereinafter: SBN) had operated public bus transport in the German of Oberspreewald-Lausitz since 01 August 2008. When this district issued a new tender in 2016, SBN withdrew from the tender because it considered that it could not submit an economically viable tender. The contract to provide public bus transport services was awarded with effect from 01 August 2017 to Kraftverkehrsgesellschaft Dreiländereck mbH, which set up the subsidiary OSL for this purpose. OSL employed the majority of the drivers and management staff of SBN. In April 2017, Kraftverkehrsgesellschaft Dreiländereck informed SBN that it did not intend to buy or SBN's buses, depots and other commercial installations, or to use its services. SBN indicated in this case that the takeover of the buses was ruled out, taking account of the technical and environmental standards in force. The CJEU ruled that the decisive criterion for establishing the existence of such a transfer is the fact that the economic entity in question retains its identity, as indicated inter alia by the fact that its operation is actually continued or resumed. The referring German court had already noted that the presence of experienced bus drivers in a rural such as Oberspreewald-Lausitz was decisive to guarantee the quality of the public transport service in question. It also pointed out, in particular, that the bus drivers must have sufficient knowledge of the routes, timetables in the covered and fare arrangements, as well as of the other regional bus routes, rail routes and existing connections, not only to be able to sell tickets, but also to provide passengers with the information they need to make their planned journey. The CJEU concluded that under a procedure for awarding of a public contract for public transport by buses, the fact that that entity does not take over those buses, which are the property of the economic entity previously engaged in that activity, environmental and technical constraints imposed by the contracting authority, cannot necessarily preclude the classification of that takeover of activity as a transfer of an undertaking, since other factual circumstances, such as the taking over of the majority of the employees and the pursuit, without interruption, of that activity, make it possible to establish that the identity of the economic entity concerned has been retained, this being a matter for the referring court to assess. This CJEU ruling has important implications for Belgium because it refines an important judgment of the Court of of 25 2001 in a seemingly similar Oy Liikenne case of 25 January 2001, No. C-172/99. The Court stressed in that judgment that bus transport is not an activity in which the labour force is the main factor, as it requires a significant deployment of equipment and resources. The Court added at the time that the fact that no tangible assets have been transferred from the previous contractor to the new contractor for the operation of the bus routes in question is a circumstance which must be taken into account for classification as a transfer of undertaking. The transfer of material assets was therefore crucial in that case.

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Although in the present case the material consisting of the buses was not taken over, the Court of Justice looked at other factors to determine whether the main criterion for determining whether a transfer of undertaking had taken place, namely whether the economic entity had retained its identity, was fulfilled. The Court observed that bus transport had been interrupted and largely operated on the same lines or for the same passengers, and that the presence of experienced bus drivers in rural areas is decisive to guarantee the quality of the bus routes concerned. Although this outcome, given these specific circumstances, fits well with the existing line of case law of the Court of Justice, this judgment makes it clear that it cannot be said a priori, depending on the type of undertaking (capital-intensive or labour-intensive), whether or not identity is retained because no tangible assets or personnel are taken over.

CJEU case C-344/18, ISS Facility Services, 26 March 2020 The CJEU recently ruled on a more complicated transfer of undertakings case. Mrs Govaerts was employed by the cleaning company ISS, which was responsible for the cleaning and maintenance of various buildings in the City of Ghent, divided into three lots. Mrs Govaerts was the project manager of the three areas of work corresponding to those lots. When the contract between ISS and the City of Ghent came to an end, a tender was issued with regard to the three lots. Although ISS participated, its tender was unsuccessful. Lots 1 and 3 were awarded to its competitor Atalian, while lot 2 was awarded to another competitor, Cleaning Masters. The moment that ISS no longer rendered services for the City of Ghent, the question arose what should happen with the employment contract of Mrs Govaerts. ISS believed that her employment had been transferred to Atalian, in application of the Belgian Collective Bargaining Agreement No. 32bis concluded in the National Labour Council of 07 June 1985, implementing the transfer of Undertakings Directive 2001/23/EC in Belgium. The ISS position was protested by Atalian. As none of the companies continued to employ Mrs Govaerts, the latter initiated legal proceedings to claim the payment of an indemnity in lieu of notice of both ISS and Atalian. On 25 May 2018, the Belgian Appeal Labour Court of Ghent requested a preliminary ruling. The referring court, in essence, sought to ascertain whether when a transfer of an undertaking involving a number of transferees occurs, Directive 2001/23/EC must be interpreted as meaning that the rights and obligations arising from a contract of employment that existed at the time of that transfer are transferred to each of the transferees, in proportion to tasks performed by that worker, or only to the transferee for whom the worker will perform his/her principal tasks. Alternatively, the referring court asks whether that provision must be interpreted as meaning that the rights and obligations arising from the contract of employment cannot be asserted against either of the transferees. The ruling of the CJEU is as follows. Although Directive 2001/23/EC is intended to safeguard the rights of the employee in the event of a change of employer, the interests of the transferee, who must be in a position to make the adjustments and changes necessary to carry on his/her business, cannot be disregarded. A fair balance thus should be found between the interests of the employees, on the one hand, and those of the transferee, on the other. Where there is a transfer of undertaking involving a number of transferees, Article 3(1) of Directive 2001/23/EC must be interpreted as meaning that the rights and obligations arising from a contract of employment are transferred to each of the transferees in proportion to the tasks performed by the worker concerned, provided that the division of the contract of employment as a result of the transfer is possible and neither causes a worsening of working conditions nor adversely affects the safeguarding of the rights of workers guaranteed by that Directive, which it is for the referring court to determine.

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If such a division were to be impossible to carry out or would adversely affect the rights of that worker, the transferee(s) would be regarded as being responsible for any consequent termination of the employment relationship under Article 4 of that Directive, even if that termination were to be initiated by the employee. The CJEU ruling is particularly important because it answers the question of the rights of employees working in an economic unit which has been transferred to not one but two transferees. It follows from the Opinion of Advocate General Szpunar of 26 November 2019, paragraphs 64 to 79, that the Court of Justice has apparently, for the first time, decided such a case. This ruling of the ECJ is therefore very interesting in that, for the first time, it provides for a part-time transfer of employment contracts to different employers, unless they are impossible or affect the rights of the persons concerned.

3.3 Posting of workers CJEU joined cases C-370/18 and C-371/18, CRPNPAC, 02 April 2020 The CJEU delivered its judgment today in the joined cases Vueling Airlines, concerning the binding effect of the A1 social security certificates. The case law of the Altun judgment is confirmed by the Court of Justice. At the same time, the Court disrupts the authority of res judicata in a criminal judgment. In 2012, the company Vueling Airlines SA was criminally convicted for having employed flying personnel at the airport of -Charles-de-Gaulle in Roissy France not affiliated to the French social security system. The staff was affiliated to the Spanish social security system and had been posted. Vueling had obtained E101 certificates from the competent Spanish institution but the French criminal judge did not take them into account. The judgment of the CJEU follows from the consequences of that conviction. Preliminary rulings were given by the Tribunal de Grande Instance at Bobigny and the French Court of Cassation, in each case on the basis of claims for damages for failure of the to register his employees with the French social security system. The CJEU ruled in the merged cases Vueling Airlines (C-370/17 and C-37/18) that the judge of the host Member State may not disregard an E 101 certificate (the predecessor of the current A1 certificate) if he/she considers that that certificate was obtained fraudulently. A posted worker may, under certain conditions, remain subject to the social security system of the sending State and must not be affiliated to the social security system of the host State. The authorities of the sending State may confirm this submission in an official document, i.e. the A1 certificate. In the past, the CJEU has consistently held that an E101 certificate binds the institutions of the host State (i.e. both the competent social security institutions and the judiciary) as long as it has not been withdrawn or declared invalid. This binding effect was first curtailed in the Altun case (see February 2018 Flash Report). If the authorities of the receiving State (1) have entered into a dialogue with the authorities of the sending State on the basis of information pointing to fraud (2) through an application for review, and (3) the authorities of the sending State fail to deal adequately with this application within a reasonable period of time, (4) the court of the receiving State which establishes fraud may, according to the Court, disregard the E 101 declaration. In the merged Vueling cases, the scope of the 'Altun' doctrine was called into question. In case of fraud, can the judge of the host state immediately disregard the declaration (i.e. broad scope of Altun) or must he/she first check whether the dispute procedure has been initiated (i.e. the limited scope of Altun)?

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Contrary to Advocate General Saugmandsgaard, the CJEU ruled that in order for the national court of the host State to be able to disregard A1 forms, two cumulative conditions must be fulfilled: 1. the competent social security institution of the host State has sent a proper request for reconsideration or withdrawal of the A1 forms to the competent issuing institution of the sending State, having regard to the information available to it, which gives rise to a suspicion of fraud, and the issuing institution has failed to take that information into account; and 2. the information available allows the national court of the host State, with due regard for the rights of the defence, to rule that the A1 forms were obtained fraudulently. And the authority of the criminal justice decision? That is not considered absolute by the CJEU. The authority of the res judicata may not result in a breach of Union law being continued before the civil courts. The civil court may deviate from the criminal court: “ In the light of the foregoing, the answer to the second question (…) is that Article 11(1) of Regulation No. 574/72 and the principle of the primacy of EU law must be interpreted as precluding, in a situation where an employer has, in the host Member State, acquired a criminal conviction based on a definitive finding of fraud made in breach of EU law, a civil court or tribunal of that Member State, bound by the principle of national law that a decision which has the authority of res judicata in criminal proceedings also has that authority in civil proceedings, from holding that employer to be liable, solely by reason of that criminal conviction, to pay damages intended to provide compensation to the workers or a fund of that Member State who claim to be affected by that employer’s conduct”.. The CJEU ruling is important for two reasons. First, it confirms the Altun case law. But the importance lies above all in the procedural relativisation of the authority of the res judicata of a decision of the criminal court that has become definitive. The Belgian system of the res judicata in criminal matters is very similar to that in France.

4 Other Relevant Information Nothing to report.

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Bulgaria

Summary The extraordinary situation declared in April has been extended to 14 June.

______1 National Legislation 1.1 Measures related to COVID-19 pandemic The extraordinary situation declared in April has been extended to 14 June and there is a proposal to extend it again.

2 Court Rulings Nothing to report. The civil courts were not active in May.

3 Implications of CJEU Rulings and ECHR 3.1 Transfer of undertakings CJEU case C-298/18, Grafe und Pohle, 27 February 2020 This ruling should not have any implications for Bulgaria. Article 123, para 1, item 7 of the Labour Code provides that the employment relationship with the employee shall not be terminated in the event of a change of employer as a result of cessation or transfer of the activity from one enterprise to another. No other requirements are specified.

CJEU case C-344/18, ISS Facility Services, 26 March 2020 Pursuant to Article 123, para 1, item 3 of Bulgarian Labour Code, the employment relationship with the employee shall not be terminated in the event of a change of employer as a result of the distribution of activities of one enterprise to two or more enterprises. According to Article 123, para 2 of the Labour Code, in the case covered by Paragraph (1), the rights and obligations of the transferor employer arising from the employment relationships that exist on the date of the transfer shall be transferred to the new transferee employer. One employee may be transferred only to one employer depending on his/her position and the character of the work at the transferor employer prior to the transfer.

4 Other Relevant Information Nothing to report.

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Croatia

Summary (I) A number of amendments to the different pieces of legislation has been adopted with the purpose of addressing the difficulties caused by the COVID-19 crisis. Some measures introduced to contain the COVID-19 crisis have been relaxed. (II) New employment in the public sector is prohibited. Accounting documents for the payment of salaries of public sector employees will be delivered electronically to their personal user boxes. (III) The Government of the Republic of Croatia has issued the Decision on the Establishment of a Reporting System for Support of Collective Bargaining Process and Monitoring the Effects of the Implementation of Collective Agreements. (IV) An Annex to the Collective Agreement in the Health Care Sector has been concluded. ______1 National Legislation 1.1 Measures to respond to COVID-19 crisis As regards the pieces of legislation that address the COVID-19 crisis and which have direct or indirect implications for labour law, the following are worth mentioning:  Easing of the measures (markets where the physical distance requirements can be complied with and entry to the market can be controlled will re-opened – Amendment to the Decision on special operations of markets during the COVID- 19 pandemic, Official Gazette No. 62/2020);  Work on Sundays in stores (a very controversial issue in Croatian society; the stores were closed on Sundays during the epidemic’s peak; according to the Amendment to the Decision on opening hours and manner of work in the trade sector during the COVID-19 pandemic, the stores can be open on Sundays again, Official Gazette No. 62/2020);  Tax relief is subject to prohibition of dismissals i.e. employers can make use of subsidies, provided that the initial state of employment is preserved (Amendment to the Ordinance on Profit Tax, Official Gazette No. 59/2020);  Means collected by fines for failure to fulfil obligations related to the quota employment of persons with disabilities will be used for job-saving in sectors affected by the COVID-19 crisis (Decision on the purpose of using financial compensation for non-fulfilment of the obligation of quota employment of persons with disabilities, Official Gazette No. 55/2020).

1.1 Other legislative developments 1.2.1 Prohibition of new employment in the public sector Amendment to the Act on the Execution of the State Budget of the Republic of Croatia for 2020 (Official Gazette No. 58/2020), among others, prohibits new employment in the public sector, save for cases where there are justified and clear reasons for new employment and with the consent of the minister.

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1.2.2 Accounting documents for the payment of salaries in the public sector The Government of the Republic of Croatia has issued Amendments to the Regulation on Content, Manner of Collection and Processing, and Data Protection Measures in the Register of the Public Sector (Official Gazette No. 57/2020). It specifies, among others, that the accounting documents for the payment of salaries of public sector employees will be delivered electronically to their personal inboxes.

2 Court Rulings Nothing to report.

3 Implication of CJEU Rulings and ECHR 3.1 Transfer of undertakings CJEU case C-298/18, Grafe und Pohle, 27 February 2020 The Grafe case deals with a takeover by an economic entity of an activity, the pursuit of which requires substantial operating resources (public passenger transport), under a procedure for the awarding of a public contract. That entity did not take over those resources, which are the property of the economic entity previously engaged in that activity, on account of legal, environmental and technical constraints imposed by the contracting authority. The CJEU ruled that this does not necessarily preclude the classification of that takeover of activity as a transfer of an undertaking, since other factual circumstances, such as the taking over of the majority of employees and the pursuit, without interruption, of that activity, make it possible to establish that the identity of the economic entity concerned has been retained. This is a matter for the referring court to assess. In Croatia, transfers of undertakings are regulated in Article 137 of the Labour Act. According to Article 137(1), in the event of a transfer of an undertaking, business or parts of an undertaking or business, retaining its economic integrity, to a new employer, as a result of the change of status or a legal transaction, all contracts of employment of the workers employed with the undertaking or part of the undertaking being transferred, or of those who are connected with the business or part of the business being transferred, are transferred to the new employer. Since this provision does not explain what ‘retaining of economic integrity’ means, it can be read in line with the judgment in this case without the need to amend it.

CJEU case C-344/18, ISS Facility Services, 26 March 2020 This case dealt with a simultaneous transfer of various parts of an undertaking to various transferees. The issue raised by the referring court is whether the rights and obligations arising from the contract of employment, as existed at the time of the transfer of a worker who was employed in each of the parts transferred, are to be transferred to each of the transferees, albeit in proportion to the extent of the employment of the worker in question in the part of the undertaking acquired by each of the transferees, or Article 3(1) of Directive 2001/23/EC should be interpreted as meaning that the aforementioned rights and obligations are to be transferred in their entirety to the transferee that acquired the part of the undertaking in which the worker in question was principally employed, or as meaning that, if the provisions of the Directive cannot be interpreted in any of the aforementioned ways, there is no transfer to any transferee of the rights and obligations arising from the employment contract of the aforementioned worker,

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which is also the case if it is not possible to determine the extent of the worker’s employment separately in each of the transferred parts of the undertaking. The CJEU ruled that where a transfer of undertaking involves a number of transferees, Article 3(1) of Directive 2001/23/EC must be interpreted as meaning that the rights and obligations arising from a contract of employment are transferred to each of the transferees in proportion to the tasks performed by the worker concerned, provided that the division of the contract of employment as a result of the transfer is possible and neither causes a deterioration of working conditions nor adversely affects the safeguarding of the rights of workers guaranteed by that Directive, which it is for the referring court to determine. If such a division were impossible or would adversely affect the rights of that worker, the transferee(s) would be regarded as being responsible for any consequent termination of the employment relationship under Article 4 of that Directive, even if that termination were to be initiated by the worker. Article 4(2) of Directive 2001/23/EC has not been transposed into Croatian law. When the employee decides to terminate the contract of employment due to substantial changes in working conditions to the detriment of the employee, there is no provision that states that the employer is considered responsible or that the substantial change in working conditions is a cause for extraordinary dismissal. There is a need to transpose Article 4(2) of Directive 2001/23/EC into Croatian law, among others, because unemployed persons are entitled to unemployment benefits when their contracts of employment are terminated by the employer for business reasons or when an unemployed person has terminated his/her employment contract through an extraordinary dismissal caused by employer misconduct. Unemployed persons who terminate their contract of employment unilaterally for other reasons are not entitled to unemployment benefits.

4 Other Relevant Information 4.1 Collective bargaining The Government of the Republic of Croatia has issued the Decision on the Establishment of a Reporting System to Support the Collective Bargaining Process and for Monitoring the Effects of the Implementation of Collective Agreements (Official Gazette No. 60/2020). It intends to establish a central business information system to conduct analyses, simulations and analytical support for parts of the collective bargaining process that affect employee expenditures and for monitoring the financial and legal effects of collective agreements concluded in state bodies and public services. The reporting system will be established with the aim of improving the system of collective bargaining in state bodies and public services by addressing the weaknesses of the wage setting framework in consultation with the social partners to encourage the alignment of wages with performance and macroeconomic conditions. Funds for the establishment of the reporting system are provided by the Ministry of Labour and Pension System from the European Social Fund. The reporting system will be operational by 30 June 2021. The new Annex to the Collective Agreement in the Health Care Sector (Official Gazette No. 56/2020) regulates the rights of employees in the health care sector in terms of salary increases for overtime work, allowances for the exceptional responsibility for human life, and health and salary increases for Master of Science and Doctor of Science degrees.

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Cyprus

Summary (I) The restrictive emergency measures to respond to the COVID-19 pandemic have been eased in the relevant legislation. (II) The suspension of schemes for certain groups of employees without consultation or warning is being criticised as violating labour and children’s rights of vulnerable persons. (III) There are developments in the amendment of the bill that will convert public sector employees with contracts of indefinite duration into civil servants. However, some questions regarding the compatibility of this amendment with the principle of equal treatment stipulated in Directive 1999/70/EC are still unclear. ______

1 National Legislation 1.1 Measures to respond to COVID-19 crisis 1.1.1 Easing of restrictive emergency measures In May, the restrictions related to the COVID-19 lockdown which has affected labour relations have been gradually eased. On 11 May, the first measures were eased, to be followed by a gradual lifting of the lockdown and other restrictions, which permitted the opening of parks, playgrounds, sports grounds, open air markets, door-to-door sales, places of worship, beaches and squares. Scholars have argued that some of the measures imposed, for instance, the curfew and the ban on swimming in the sea were disproportionate and could not be justified as necessary in a democratic society (Kaoulla, L. (2020) ‘Πρόεδρος Νομικής ΠΚυ: Αντισυνταγματική εφαρμογή των μέτρων στις παραλίες’, SigmaLive, 18 May 2020). The second phase of easing restrictions (Law on Infections (O περι Λοιμοκαθαρσεως Νομος) Cap 260, Regulatory Administrative Act No. 5256, Ref. 183, 30 April 2020) lasted from 04 May until 21 May during which:  Exit permits were increased from one to three daily;  Travel between cities was permitted to care for persons belonging to vulnerable groups or who depend on others, as well as for swimming;  The duration of exit permits was for a ‘reasonable amount of time’; no exit was permitted between 22.00 and 06.00 the following day;  Hunters were permitted to go out to train and exercise their dogs, subject to restrictions;  Fishing was permitted subject to restrictions;  shops could open provided they had masks and antiseptic hand sanitiser at the entrance for all visitors. Shops should be aired and cleaned daily on the basis of a specific protocol for the cleaning of surfaces, permitting one customer per eight square metres. Small retail shops could permit only one customer at a time, whilst larger shops should bear a sign stating how many customers could be allowed inside on the basis of their square metres. A duty was placed on employers to provide masks for all employees; masks had to be worn at all times when servicing customers and where the distance between employees was less than two metres;

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 Supermarkets and bakeries were permitted to open again on Sundays;  Open air fruit markets were permitted with 50 per cent of their normal capacity, permitting entry of only one person for every eight square metres. The markets should only serve vulnerable groups, elderly (over 60) or disabled customers until 10am. Masks, hand sanitiser and one use gloves should be made available for persons working at the markets; hand sanitizer should also be made available for customers. Fruit and vegetables should only be offered in paper or plastic bags;  Schools re-opened in different phases for different ages. Children in the final of the Lyceum were the first to return to school on 11 May. The second group of children were primary school pupils aged between 6 and 12, and the students, aged between 13 and 15, for whom schools re-opened on 21 May. Children with disabilities were initially not permitted to return to school but were allowed to return following a series of protests by parents and criticism from the child ;  The use of masks by members of the public is recommended but is not obligatory. The use of masks is mandatory for persons working in means of public transport such as bus drivers, private and public organisations in closed spaces serving the public, persons working in retail businesses serving the public. The second phase of the easing of restrictions started on 21 May (Cyprus, Press and Information Office (2020), ‘Σταδιακή άρση των περιορισμών Δευτερη Φάση’). In this phase:  The use of SMS has been abolished and people can leave their homes freely;  Groups of people up to 10 persons are permitted;  As of 23 May, church masses and other religious services have been permitted, subject to compliance with health protocols;  Parks, playgrounds, squares and other public areas can re-open, but only groups of up to 10 persons are permitted at a time;  The prohibition of movement between 10.00 and 06.00 has been abolished;  Visits to houses for up to 10 persons are permitted;  Restaurants can re-open in open air spaces for groups of up to ten persons each. The third phase of the measures is planned for 09 June-13 July and the fourth phase from 14 July onwards.

1.1.2 Return to work In March 2020, circulars provided for schemes that allowed parents who belonged to vulnerable groups or who had children who belonged to such a group to stay at home. However, without warning or any consultation, another circular was issued on Friday afternoon (Circular No. 1623, 12 June 2020) informing that the vulnerable groups should return to work immediately. This raises problems for parents who have to care for children under the age of 15 years until the end of the school year, i.e. until 26 June 2020. The State employer informed employees who wish to stay at home to care for their children to request the use of annual leave to care for their children. This was strongly criticised by the main opposition party, accusing the government of deciding unilaterally, suddenly and arbitrarily, ignoring the problems this causes to workers, society and public health (statement of the spokesperson of AKEL, Stephanos

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Stephanou, 15 June 2020). Primary and secondary schools, kindergartens and children's clubs are partially operational. There is concern about the following:  Working families would have little options than to take their children to grandparents, who belong to the vulnerable groups;  Workers will face pressure from employers to return to work under the threat of dismissal or pressuring them to use their annual leave. Trade unions have complained that this is irregular and contrary to the law, as parents are required to care for their children because the Ministry decided to close and only partially re-open schools, with schools now operating with only half of the students and for reduced hours (Union ΙΣΟΤΗΤΑ, Press Release - 13 June 2020. The union represents public sector employees who started working under a temporary contract but whose contracts were converted into contracts of indefinite duration). The Union argues that the practical options available to parents are linked to irreconcilable dilemmas:  Take the children to grandparents (those who have this option) when the schools are closed, risking mainly the health of the grandparents, given that children only have lessons in alternate weeks, or  Commit a criminal offense, and leave the children home alone, or  Take the children to work. The Union has filed complaints with the Commissioner for Administration and Protection of Human Rights and the Commissioner for the Protection of the Rights of the Child alleging violations of labour rights and children's rights.

1.2 Other legislative developments 1.2.1 Public sector employees Trade union employees with contracts of indefinite duration have published its proposed changes to the bill currently before a parliamentary committee, pending since February 2020 (there were two sessions of the Committee on 12 February 2020 and 24 February 2020), so that the new law meets the standards of equal treatment between permanent and extraordinary civil servants, as required by Directive 1999/70/EC. The Union quotes the opinion of the Attorney General, which noted that the bill drafted is incompatible with the Directive because it continues to exclude the service in an extraordinary position from the definition of the term ‘public service’, unless a competent authority decides otherwise, while the opposite should be the case, i.e. the emergency service should be included in the above definition, unless otherwise determined by the competent authority for objective reasons in accordance with Article 5 (1) of Law 98 (I) of 2003, as amended. Also, it quotes the Attorney General’s opinion that compliance with the equal treatment principle should include the rights and obligations that define a specific employment relationship and include financial benefits and the treatment of the employee during the development of his/her career. The union notes that the House of Representatives had failed to repeal previous domestic provisions, as it should have done, such as those of the Public Service Law, which do not equate extraordinary with civil servants (ISOTITA, Statement 13 June 2020).

2 Court Rulings Nothing to report.

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3 Implications of CJEU Rulings and ECHR 3.1 Transfer of undertakings CJEU case C-298/18, Grafe und Pohle, 27 February 2020 The CJEU (para. 39) ruled that since a group of workers engaged in a joint activity on a permanent basis, it constituted an economic entity, and such an entity is capable of maintaining its identity after it has been transferred, where the new employer does not merely pursue the activity in question but also takes over a part, in terms of their numbers and skills, of the employees specially assigned by the predecessor to that task. In such circumstances, the new employer takes over a body of assets that enable him/her to carry out the activities or certain activities of the transferor undertaking on a regular basis (the court cited the judgment of 20 January 2011, CLECE, C-463/09, EU:C:2011:24, paragraph 36 and the cited case law). Thus, in the present case, the fact that the operating resources necessary for the pursuit of the economic activity were not transferred does not necessarily preclude the entity in the main proceedings from retaining its identity, the taking over of the majority of the drivers must be regarded as a factual circumstance to be taken into account in order to classify the transaction concerned as a transfer of an undertaking. In this respect, it is apparent from the facts at issue in the main proceedings that the members of staff taken on by the new operator are assigned to the same or similar tasks and hold specific qualifications and skills that are essential for the pursuit, without interruption, of the economic activity concerned. Hence, the CJEU (para 41) ruled that the answer to the questions referred to it is that Article 1(1) of Directive 2001/23/EC must be interpreted as meaning that, in the context of the takeover by an economic entity of an activity, the pursuit of which requires substantial operating resources, under a procedure for the award of a public contract, the fact that that entity does not take over those resources, which are the property of the economic entity previously engaged in that activity, on account of legal, environmental and technical constraints imposed by the contracting authority, cannot necessarily preclude the classification of that takeover of activity as a transfer of an undertaking, since other factual circumstances, such as the taking over of the majority of the employees and the pursuit, without interruption, of that activity, make it possible to establish that the identity of the economic entity concerned has been retained, this being a matter for the referring court to assess. The case offers good guidance for Cypriot courts. The Cypriot law on transfers of undertakings (Ο Περί της Διατήρησης και Διασφάλισης των Δικαιωμάτων των Εργοδοτουμένων κατά τη Μεταβίβαση Επιχειρήσεων, Εγκαταστάσεων ή Τμημάτων Επιχειρήσεων ή Εγκαταστάσεων, Νόμος του 2000 (104(I)/2000)) uses the language of the Directive to transpose Articles 1.1(a), 1.1(c), and 1.3.

CJEU case C-344/18, ISS Facility Services, 26 March 2020 The CJEU (para. 36) noted that according to Article 4(1) of that Directive, while the transfer of an undertaking or part thereof cannot in itself constitute a ground for dismissal for the transferor or the transferee, other than in the situations mentioned in Article 4(1) of that Directive; that provision does not, however, preclude the possibility of dismissals for economic, technical or organisational reasons entailing changes in the workforce. Furthermore, Article 4(2) states that if the contract of employment is terminated because the transfer involves a substantial change in working conditions to the detriment of the employee, the employer is to be regarded as having been responsible for the termination. This means that the CJEU noted that if the division of the contract of employment proves to be impossible or entails a deterioration in the working conditions and rights of the worker as guaranteed by Directive 2001/23/EC, that contract may be terminated, and the termination must be regarded, under Article 4(2) of Directive 2001/23/EC, as the responsibility of the transferee(s), even if that

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termination has been initiated by the worker. Hence, the CJEU (para 38) ruled that where a transfer of undertaking involves a number of transferees, Article 3(1) of Directive 2001/23/EC must be interpreted as meaning that the rights and obligations arising from a contract of employment are transferred to each of the transferees, in proportion to the tasks performed by the worker concerned, provided that the division of the contract of employment as a result of the transfer is possible and neither causes a deterioration of working conditions nor adversely affects the safeguarding of the rights of workers guaranteed by that directive, which it is for the referring court to determine. If such a division were impossible to carry out or would adversely affect the rights of that worker, the transferee(s) would be regarded as being responsible for any consequent termination of the employment relationship under Article 4 of that Directive, even if that termination were to be initiated by the worker. This case is relevant for Cyprus and offers guidance to Cypriot courts on the articles of the Directive on Transfers of Undertaking. The provision in the first paragraph of Directive Article 4.1 is used verbatim in Article 5(1) of the Cypriot law on transfers of undertakings (Ο Περί της Διατήρησης και Διασφάλισης των Δικαιωμάτων των Εργοδοτουμένων κατά τη Μεταβίβαση Επιχειρήσεων, Εγκαταστάσεων ή Τμημάτων Επιχειρήσεων ή Εγκαταστάσεων, Νόμος του 2000 (104(I)/2000)), to the effect that dismissals made as a result of a transfer are unlawful, unless they take place as a result of economic, technical or organisational reasons, resulting in changes in the workforce. When dismissals are deemed to be unlawful, the provisions on the law on unfair dismissal apply, as all other unlawful terminations of employment. If the transfer results in substantial changes in the terms of employment to the detriment of the employee, the employer shall be considered responsible for terminating the employment contract or the employment relationship (Article 5(2) of the Cypriot law transposing Directive Article 4.2). The general provisions relating to unfair dismissal (regulated by Article 3(1) of the Termination of Employment Law) requires an employee who has 26 weeks of ‘continuous employment’ to be entitled to compensation for unfair dismissal. Employees with less than 26 weeks of employment are not protected at all against dismissal (the only provisions in Cypriot law protecting employees, who have worked less than 26 weeks, from dismissal are the laws transposing the anti-discrimination Directives 2000/43/EC and 2000/78/EC, the Gender Equality Directives and the laws on protection of maternity, which prohibit dismissals of employees from the moment the employee informs the employer that she is pregnant). Article 2 of the Cypriot Law defines ‘economic, technical or organisational reasons’ as those specified in Article 18(c) of the Termination of Employment Laws of 1967-2001, which lists the following (the Termination of Employment Laws of 1967-2001 set out these and other factors as reasons giving rise to compensation on the ground of redundancy):  modernisation, mechanisation or any other change in the methods of production or organisation which reduces the number of necessary employees;  change in the products or in the methods of production or in the necessary specialisations of employees;  abolition of departments;  difficulties in the placement of products in the market or difficulties;  shortage of orders or of raw materials;  scarcity of means of production;  Reduction in the volume of work or of the undertaking (this covers situations in which the business is reduced, or if the undertaking ceases to offer certain services or products or one of its departments is closed).

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There are no exceptions in Cypriot law limiting the scope of application of the protection against dismissal. According to the law, this protection is afforded to all employees without exception, subject to the provision of minimum continuous employment with a minimum of 26 weeks. Those who work less than 26 weeks are not protected. According to Article 5(2) of the Cypriot Law, which purports to transpose Directive Article 4.2, a transfer that results in substantial changes in the terms of employment to the detriment of the employee will render the employer responsible for termination and liable to pay compensation to the employee (Theodoros Kyprianides Vs. R. Rousounides Enterprises Ltd, Case No. 4/05). Three similar cases on the subject of transfers of undertakings have been dealt with in Cyprus. In the case of Loris Savvides v. SSP Catering Cyprus, Redundancy Find and CTC- ARI Airports Ltd (Civil Appeal No. 179/2009, 20 September 2012), the appellant was an employee of SSP Catering (respondent No.1) who managed the shops at Larnaca Airport on the basis of a contract. In 2006, respondent No.1 informed the appellant that the management of the airport would be taken over by an investor and that they would no longer manage 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 relationship. Respondents 1 and 3 claimed that this was not a case of transfer of an 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 an undertaking and the relevant Directive applied. court rejected the claims against all three respondents. It ruled that a transfer of an undertaking from Respondent 1 to Respondent 3 had taken place within the meaning of the Directive, as Respondent 3 continued to carry out the operations of Respondent 1 and had proposed further 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 by 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 possessions of the shops to Respondent 3; and the identity of the undertaking was not retained so there was no information as to what type of enterprise the investor would set up. The appeal court agreed with this argument and granted the appeal. The appeal court pointed out that the trial court appeared to have been influenced by the appellant’s refusal to accept Respondent 3’s offer of employment, which was not the key factor in this case. The second case, CTC – ARI Airport Ltd v. Charalambos Andreou, SSP Catering Cyprus Ltd. Redundancy Fund (CTC - ARI Airport Ltd Ν. 1. Χαραλαμπου Ανδρεου, 2. SSSP Catering Cyprus Ltd, 3. Ταμείο Πλεονάζοντος Προσωπικού, Civil Appeal No. 359/2009, 26 November 2014) is factually along the same lines as the previous case, but with a different outcome. Based on the same facts as Loris Savvides (above), Respondent 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 the management would be taken over by CTC- ARI Airports Ltd (the appellant). 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

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an enterprise are assigned to the transferee in order to ensure the 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 offer the continuation of his employment. The court rejected the appellant’s argument that it had no obligation to compensate Respondent 1 because he had rejected an 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 Appeal Court found that the trial court had erred in that it 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 him a definite offer, as it had done with the other employees. The unequivocal position of Respondent 1 that he did not want to continue working for the transferee was also the reason why the appellant proceeded to restructure the enterprise, as a result of which the position previously held by appellant 1 was cancelled. As a consequence of the refusal of Respondent 1 to work for the appellant, he had 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 is seen as unreasonably refusing the offer of another suitable job, which according to Article 20(a) of Law 24/1967, caused him to lose his right to redundancy compensation. The Appeal Court therefore allowed the appeal and set aside the trial court decision. The third case Giannoula Tomazou and others V Redundancy Fund (Civil appeal case No. 11418, 16 July 2003, 1 Α.Α.Δ. 1078.) dates from 2003. The Supreme Court ruled that the Labour Court 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 the new company, inter alia, was 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”).

4 Other Relevant Information Nothing to report.

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Czech Republic

Summary (I) An update on the extraordinary measures of the government adopted in connection with the COVID-19 crisis is provided. In the context of mitigating the consequences of the COVID-19 crisis, legislative changes included are the publication of the Act on Carer’s Allowance, the extension of Regime A and Regime B of the ‘Antivirus’ Programme and a Draft Law for Regime C (on exemptions from the obligation to pay social security contributions for small enterprises), the publication of the Act on protection of employees in the event of insolvency of their employer, and measures in the areas of social security insurance and sickness insurance. (II) An amendment of the Labour Code has passed the Senate and is now awaiting the President’s signature. Among other points, it transposes Directive (EU) 2018/957. ______1 National Legislation 1.1 Measures to respond to COVID-19 crisis 1.1.1 Update on the extraordinary measures To respond to the COVID-19 crisis, the Government of the Czech Republic has declared a state of emergency (see below). The government and the individual ministries (as well as other authorities) have adopted a number of extraordinary measures with the aim of limiting the spread of the COVID- 19 disease in the population. We already informed of the relevant measures in the March 2020 and April 2020 Flash Reports. In the present report, we reflect on recent developments.  Declaration of state of emergency Resolution of the Government No. 219/2020 Coll. issued on 30 April 2020 as Resolution No. 485 (published) On 12 March 2020, the government declared a state of emergency in response to the COVID-19 crisis – under the state of emergency, the government is authorised to issue extraordinary measures. The state of emergency was repeatedly extended and finally ended on 17 May 2020 – many of the extraordinary measures ended with it. After that, some extraordinary measure of the government have been re-issued as measures from the Ministry of Health.  Reintroduction of controls Resolution of the Government of 25 May 2020 No. 570 on temporary re- introduction of border controls and annexed Measure of General Nature of 25 May 2020 Border controls for the land border and for the air border have mostly been lifted.  Restrictions in international transport Resolution of the Government No. 225/2020 Coll. issued on 04 May 2020 as Resolution No. 506 (published) Restrictions on international road, rail and air passenger transport have mostly been lifted.  Travel ban

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Protective Measure of the Ministry of Health No. MZDR 20599/2020-7/MIN/KAN of 05 June 2020 With effect as of 05 June 2020 until 14 June (23:59), entry into the territory of the Czech Republic is still banned for all foreign nationals who did not have a temporary residence permit for more than 90 days or a permanent residence permit on 12 March 2020 with the following exceptions:  family members of Czech citizens or EU citizens with residence in the Czech Republic;  EU nationals and foreign citizens with a visa for stay in the EU who pass through the Czech Republic to get home and have a pass permit for that purpose issued by the embassy;  persons whose entry into the territory is in the interest of the Czech Republic;  cross-border workers, pupils and students who regularly cross the of the Czech Republic with neighbouring states for the purpose of performance of work or studies;  workers in transnational transport;  service workers of critical infrastructure;  diplomats and officials of international organisations;  EU citizens who enter the territory of the Czech Republic (demonstrably) to perform economic activity for a period of no longer than 72 hours (after submitting a negative COVID-19 test result);  EU citizens who enter the territory of the Czech Republic to perform an economic activity or for the purposes of studies (after submitting a negative COVID-19 test result);  food production workers;  key scientists;  medical and social workers;  some holders of long-term visas;  spouses and children of some foreign nationals with a long-term or permanent stay in the Czech Republic;  EU citizens with a confirmation for temporary stay or permanent stay in Hungary, Germany, Austria, Slovakia, and foreign nationals who have permanent residence status in these countries, should they cross the border to the Czech Republic from Germany, Austria, or Slovakia;  other extraordinary situations. The reasons above must be adequately documented (proven). Persons entering the territory of the Czech Republic still have the obligation to notify the competent hygiene station in listed cases, to be tested for COVID-19, etc. Quarantine or isolation can be ordered for persons entering the territory of the Czech Republic.  Restrictions on provision of goods and services Extraordinary measure of the Ministry of Health No. MZDR 20581/2020- 5/MIN/KAN of 02 June 2020 With effect of 08 June 2020, the Ministry of Health has re-issued restrictions on

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the retail sale of goods and provision of services in establishments (i.e. shops). The presence of the public in eateries and other similar establishments is prohibited between 23:00 and 6:00 – this does not apply to outside seating areas of such establishments, establishments that are not open for the public (such as employee eateries, prison eateries, etc.); this also does not apply to sales outside the actual establishment (e.g. t take-out windows). Food and beverages must be consumed at least 10 metres from the place of sale (with exceptions). Establishments (shops) are now mostly open but must comply with specific hygiene rules (obligations of employees/customers to wear masks, obligation to provide disinfectants, to ensure minimum distance between persons, maximum number of customers, etc.).  General restrictions on free movement of persons Extraordinary measure of the Ministry of Health No. MZDR 20588/2020- 5/MIN/KAN of 02 June 2020 Restrictions on the free movement of persons have been lifted to a large degree. Most events with attendance of over 500 persons are, however, still banned (with exceptions). During mass events with an attendance of 500 and fewer persons, a distance of at least 2 metres from other persons must be kept (this does not apply to members of the same household) and disinfectant must be made available. Specific rules are set forth in particular with regard to sporting events, religious services and weddings.  Prohibition of free movement of persons not wearing respiratory protective equipment (of mouth and nose) Extraordinary measure of the Ministry of Health No. MZDR 15757/2020- 21/MIN/KAN of 05 June 2020 With effect of 08 June 2020, 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 indoor spaces (with the exception of places of residence), in public transport, and all other places where distance between persons is less than 2 metres (with the exception of family members). The extraordinary measure further lists specific exceptions form the above ban, e.g.:  public transport drivers who are separated from the space designated for the transport of passengers;  children under 2 years of age;  persons with severe autism spectrum disorders; and  drivers of closed vehicles if driving alone or with members of their household;  employees if they perform work in one place and keep a distance of at least 2 metres from other persons,  lifeguards, coaches and instructors when performing work in swimming pools if they keep a distance of at least 2 metres from other persons, etc.  Ban on personal attendance in schools and other similar facilities Extraordinary measure of the Ministry of Health No. MZDR 20584/2020-

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3/MIN/KAN of 25 May 2020 With effect of 01 June 2020, the ban on personal attendance in schools and other similar facilities (of which we informed in our previous Flash Report) was re- adopted by the Ministry of Health. However, the extraordinary measure now lists a large number of exceptions – limited personal attendance in relevant facilities is possible if certain conditions are fulfilled and certain rules adhered to.

1.1.2 Carer’s allowance Act No. 230/2020 Coll., amending Act No. 133/2020 Coll. on certain adjustments with regard to social security in connection with extraordinary measures during the 2020 epidemic has been adopted and published and entered into effect on 06 May 2020. We have already informed about this Act in the April 2020 Flash Report.

1.1.3 State financial aid for employers The Government of the Czech Republic adopted Resolution of 31 March 2020 No. 353 on a targeted programme to support employment. By means of this resolution, the government approved the so-called ‘Antivirus’ programme. This programme is meant to support employment and to help employers deal with the COVID-19 crisis. Subsequently, the Government of the Czech Republic adopted Resolution of 27 April 2020 No. 481 on the extension of the Antivirus programme until 31 May 2020. On 25 May 2020, the Government of the Czech Republic adopted the Resolution of 25 May 2020 No. 581 on the extension of Regime B of the Antivirus programme until 31 August 2020. On 08 June 2020, the Government of the Czech Republic adopted Resolution of 08 June 2020 No. 635 on the extension of Regime A of the Antivirus programme until 31 August 2020. As already discussed in the March 2020 and April 2020 Flash Reports, the government has adopted a targeted programme to support employment and to help employers deal with the impacts of the COVID-19 crisis, i.e. the so-called ‘Antivirus’ programme. The state contribution was approved to be provided under 2 regimes, i.e. Regime A and Regime B (see previous reports). Both regimes were approved until 31 May 2020. On 25 May 2020, Regime B was extended until 31 August 2020. On 08 June 2020, Regime A was extended until 31 August 2020. Further, a proposal for a third regime has been introduced – Regime C (see point 1.1.4).

1.1.4 Antivirus programme – Regime C The Draft Act on the remission of social security insurance contributions and contributions to the state employment policy paid by certain employers as taxpayers in connection with emergency measures during the 2020 epidemic has entered the legislative process (the Draft Act has been approved by the government and has been forwarded to the Parliament of the Czech Republic). Information on the legislative process is available here. The Draft Act introduces Regime C as part of the state financial aid for employers (the Antivirus Programme – see point 1.1.3). As opposed to Regimes A and B of the Antivirus

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Programme, Regime C is introduced in the form of an Act of Parliament and needs to pass through the legislative procedure. Regime C essentially consists of an exemption from the obligation to pay social security contributions and contributions to the state employment policy for June, July and August 2020, which applies to certain (small) employers under the conditions stated below. Regime C applies to employers if:  the number of employees in employment relationships participating in the sickness insurance scheme does not exceed 50;  the number of employees in employment relationships participating in the sickness insurance scheme does not decrease by more than 10 per cent from March 2020;  the total amount of salaries paid by the employer does not decrease by more than 10 per cent from March 2020;  the employer has duly paid insurance contributions for the relevant employees and in time;  the employer does not draw contributions from Regime B of the Antivirus Programme;  the relevant employee was not given notice of termination of employment due to organisational reasons. The Draft Act was approved by both the government and Parliament, however, it was returned to Parliament by the Senate on 10 June 2020. The Draft Act will enter into effect on the date of its publication in the Collection of Laws.

1.1.5 Protection of employees in the event of insolvency of their employer Act No. 248/2020 Coll., on certain measures adopted to mitigate the effects of the SARS CoV-2 coronavirus epidemic in the field of protection of employees in the event of insolvency of their employer, has been adopted and published. During the COVID-19 crisis, Act No. 191/2020 Coll. was adopted. It introduced a special temporary measure to protect debtors from insolvency procedures – from 24 April 2020 to 31 August 2020, the insolvency petition filed by the creditor is not considered (the court issues a resolution informing the creditor that the insolvency petition is not considered). However, employees to whom the employer owes salary are also creditors for the purposes of Act No. 191/2020 Coll. – this piece of legislation made it impossible for employees to file an insolvency petition against their employer, who has not paid them their salary, and such employees could therefore not apply for substitute payment of their salary to be provided by the Labour Office under the conditions of Act No. 118/2000 Coll., on the protection of employees in the event of insolvency of the employer. As of 19 May 2020, based on the adoption of the Act, the employees may again claim protection under Act No. 118/2000 Coll., on the protection of employees in the event of insolvency of the employer, and claim substitute payment of their salary to be provided by the Labour Office (following submission of the court resolution above). The special procedure described above will be in effect until 31 August 2020. The Act entered into effect on 19 May 2020.

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1.1.6 Social security and sickness insurance Act No. 255/2020 Coll., on the reduction of the penalty from social security contributions and the contribution to the state employment policy paid by employers as taxpayers in connection with extraordinary measures during the epidemic in 2020 and on the amendment of certain laws has been published. If the employer does not (fully) pay social security insurance contributions and contributions to state employment policy for May, June or July 2020, penalties for non- payment have been lowered (by 80 per cent). The Act further states that the employer is to submit the records of employees’ pension insurance and information on the amount of the assessment base for the purposes of calculation of social security insurance contributions and contributions to state employment policy by electronic means only. If objective reasons stated by the employer prevented the employer from submitting the above electronically, such can be submitted in writing in the prescribed (physical) form. Furthermore, the Act states that from 01 September 2020, the employer is required to notify the social security administration in electronic form of the employees’ commencement of employment, which establishes his/her participation in the sickness insurance scheme, no later than on the working day following the day of commencement of employment. The employer is further required to notify the social security administration of the end of such employment no later than on the working day following the day of the end of the period of employment. Previously, such notification could be made in 8 days. All related documentation is sent electronically. In the March 2020 and April 2020 Flash Reports, we informed about the so-called carer’s benefit provided, among others, to employees who cannot work due to schools and other similar facilities being closed on the government’s orders in connection with the COVID-19 crisis. The Act states that employees who do not place their child in school (or similar facility) in view of the possibility of endangering his/her health or the health of other persons living with the child in a shared household due to the COVID-19 crisis or for other serious reasons will also be entitled to the benefit – even though the facility has already opened. The employee states the reasons in a prescribed form. The Act enters into effect in several phases – on 27 May 2020, on 01 June 2020, and on 01 September 2020. The Act mitigates the impacts of the COVID-19 crisis on employees who are taking care of children that attend school or similar facilities. It also introduces the obligation to submit certain information to authorities exclusively in electronic form (with exceptions). The notification period for notifying the social security administration of the commencement and end of employment of the employee has been considerably shortened, which may be problematic. Penalties for non-payment of social security insurance contributions and contributions to state employment policy have been temporarily lowered (given that certain conditions are met). It is in line with the EU aquis. It will have no likely implications.

1.1.7 Qualification requirements Draft Act on certain measures adopted to mitigate the effects of the coronavirus epidemic known as SARS-CoV-2 in the area of demonstrating compliance with qualification requirements for employment purposes has entered the legislative procedure (it is currently being deliberated in the House of Deputies of the Parliament of the Czech Republic). Information on the legislative process is available here. The Draft Act would apply temporarily between 12 March 2020 and 31 December 2020

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– for this period, the relevant employees are to be considered as complying with qualification requirements for the purposes of performance of work according to special legislation listed in the annex to the Draft Act. Furthermore, in the same period, the employer would not be required to conduct periodical trainings of employees pursuant to special legislation (e.g. fire protection training of employees). Such does not apply to periodical trainings conducted electronically. The validity of relevant documents has also been extended, unless the employment relationship between employer and the employee terminates within the period above. The Draft Act would enter into effect on the day following the date of its publication in the Collection of Laws.

1.2 Other legislative developments 1.2.1 Amendment of the Labour Code The Draft Act amending Act No. 262/2006 Coll., the Labour Code, as amended, and other legislation, has been approved by the Senate of the Czech Republic – now, only the signature of the President is required and subsequently it will be published in the Collection of Laws. Information on the legislative process is available here. We have already informed of this Act in the July 2019 Flash Report – the Act mainly aims to transpose Directive (EU) 2018/957 of the and of the Council of 28 June 2018 amending Directive 96/71/EC on the posting of workers in the framework of the provision of services. It further also introduces, among others, the following changes:  Termination of employment in connection with transfers of undertakings If an employee gives the employer notice of termination due to a transfer of undertaking within 15 days of the notification of the employer (which must be made at least 30 days before the date of effective transfer), the employment terminates on the day before the date of the effective transfer. If the employee was not timely and duly informed at least 30 days in advance but gives notice of termination before the effective date of the transfer, the employment ends on the day before the date of effective transfer. If the employee was not timely and duly informed at least 30 days in advance but gives notice of termination after the transfer within 2 months of the date of effective transfer, the notice period is shortened to 15 days calculated from the date of delivery.  Calculation of annual leave The Act introduces a new calculation of annual leave. Leave would be newly calculated in hours (not days) while the current minimum amount of leave would be retained. This approach should generally be fairer, especially for employees with unevenly distributed working hours.  Compensation of non-pecuniary damage An employee’s spouse, partner, child, parent, or other close person are entitled to a one-time compensation of non-pecuniary damage in the event of particularly serious harm to the employee’s health. The amount of compensation will have to be specified by the courts. An employee’s spouse, partner, child, parent, or other close person are entitled to a one-time compensation of non-pecuniary damage for survivors (in case of

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the employee’s ). The minimum amount of compensation is set to 20 times the average monthly salary in the national economy for the first and third quarter of the preceding year (the average monthly salary for the first and third quarter of 2019 is CZK 33 429, approx. EUR 1 232). The minimum amount of compensation for funeral expenses is set at the average monthly salary in the national economy for the first and third quarter of the preceding year (see above).  Shared work position The employer and two or more employees with shorter working hours and with the same type of work may conclude an agreement, pursuant to which such employees will perform work within a shared work position according to a schedule they agree on among themselves – however, the sum of the employees’ weekly working hours may not exceed statutory weekly working hours set forth by the Labour Code and each of the employees must fulfil their weekly working time within a four-week period, on average. The agreement must be concluded in writing.  Delivering employment law documents According to the Act, documents shall be delivered directly to the employee in the workplace. Only if this is not possible can the employer use the following:  Delivery directly to the employee at any place where the employee is present;  delivery via delivery services;  delivery by electronic means;  delivery via data box (only if the employee provided written consent to such delivery). If the employer delivers a document to the employee’s address, it must be an address previously forwarded to the employer by the employee.  Transfers of undertakings The Act also aims to specify transfers of undertakings – a transfer of undertaking is to take place (unless a special law states otherwise) when the employer’s activity is transferred (in whole or in part) under the following conditions:  the activity is performed in the same or similar manner and scope after the transfer;  the activity does not consist wholly or mainly in the supply of goods;  immediately prior to the transfer, a group of employees was deliberately created by the employer with the purpose of exclusively or predominantly performing the activity;  the activity is not intended to be short-term or does not consist of a one- off task; and  property (assets) is transferred, or the right to use or enjoy it, if such property is essential for the performance of the activity, or a substantial part of employees used by the current employer in the performance of the activity is taken over, if this activity depends substantially on employees only, and not on property (assets). The Draft Act will enter into effect in two phases:  the provisions relating to the transposition of Directive (EU) 2018/957 will enter into effect on 30 July 2020;

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 the remaining provisions will enter into effect on 01 January 2021.

2 Court Rulings Nothing to report.

3 Implications of CJEU Rulings and ECHR 3.1 Transfer of undertakings CJEU case C-298/18, Grafe und Pohle, 27 February 2020 The CJEU ruled that “Article 1(1) of Council Directive 2001/23/EC of 12 March 2001 on the approximation of the laws of the Member States relating to the safeguarding of employees’ rights in the event of transfers of undertakings, businesses or parts of undertakings or businesses must be interpreted as meaning that, in the context of the takeover by an economic entity of an activity the pursuit of which requires substantial operating resources, under a procedure for the award of a public contract, the fact that that entity does not take over those resources, which are the property of the economic entity previously engaged in that activity, on account of legal, environmental and technical constraints imposed by the contracting authority, cannot necessarily preclude the classification of that takeover of activity as a transfer of an undertaking, since other factual circumstances, such as the taking‑over of the majority of the employees and the pursuit, without interruption, of that activity, make it possible to establish that the identity of the economic entity concerned has been retained, this being a matter for the referring court to assess”. Currently, according to the Labour Code, the transfer of an undertaking takes place in a wider number of cases than specified in Directive 2001/23/EC, as “the transfer of undertaking under the Labour Code does not require the existence of an economic entity capable of maintaining its identity” (see judgment of the Supreme Administrative Court, No. 2 Ads 328/2017, 16 August 2019). Therefore, in this respect, the employees are afforded a higher standard of protection under Czech law. As mentioned above, an amendment of the Labour Code will enter into effect soon – a transfer of undertaking occurs (unless a special law states otherwise) when the employer’s activity is transferred (in whole or in part) under the following conditions:  the activity is performed after the transfer in the same or similar manner and scope;  the activity does not consist wholly or mainly in the supply of goods;  immediately prior to the transfer, a group of employees was deliberately created by the employer with the purpose of exclusively or predominantly performing the activity;  the activity is not intended to be short-term or does not consist of a one-off task; and  property is transferred, or the right to use or enjoy it, if such property is essential for the performance of the activity, OR a substantial part of employees used by the current employer in the performance of the activity is taken over, if this activity depends substantially on employees only, and not on property (assets).

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CJEU case C-298/18, Grafe und Pohle, 27 February 2020 The CJEU ruled that “where there is a transfer of undertaking involving a number of transferees, Article 3(1) of Council Directive 2001/23/EC of 12 March 2001 on the approximation of the laws of the Member States relating to the safeguarding of employees’ rights in the event of transfers of undertakings, businesses or parts of undertakings or businesses must be interpreted as meaning that the rights and obligations arising from a contract of employment are transferred to each of the transferees, in proportion to the tasks performed by the worker concerned, provided that the division of the contract of employment as a result of the transfer is possible and neither causes a worsening of working conditions nor adversely affects the safeguarding of the rights of workers guaranteed by that directive, which it is for the referring court to determine. If such a division were to be impossible to carry out or would adversely affect the rights of that worker, the transferee(s) would be regarded as being responsible for any consequent termination of the employment relationship, under Article 4 of that directive, even if that termination were to be initiated by the worker”. To our knowledge, the national courts have never dealt with a situation similar to the one in the present case. However, dividing employment (employment contracts) among multiple transferees does not seem feasible under the current legislative framework. Article 338(2) of the Labour Code states that under a transfer of undertaking, “the rights and obligations under employment law relationships shall fully transfer to the new employer”. The Supreme Court has stated that “as regards the contents of the employment law relationship, nothing changes – as if the change in the person of the employer never even took place” (see Decision of the Supreme Court of 25 October 2007, file. no. 21 Cdo 250/2007). It is therefore understood that the employment of a given employee is fully transferred to one employer (one transferee). In case of multiple transferees, such a situation is generally resolved based on agreements between the undertakings (and affected employees). In cases where substantial change in the working conditions to the detriment of the employee takes place after the transfer, the affected employee can terminate the employment relationship and subsequently claim in court that the termination occurred in connection with the deterioration of working conditions – if successful, the employee is entitled to severance pay (as in cases where the employment relationship was terminated by the employer).

4 Other Relevant Information Nothing to report.

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Denmark

Summary (I) The impact of COVID-19 has been relatively low in Denmark compared to neighbouring countries and has re-opened society to a large degree. Help packages have been extended, and some are now slowly being phased out. A whistleblower scheme has been adopted to avoid fraud with state payments. Particularly vulnerable employees have been offered the possibility of not physically reporting to work during the opening of society while receiving sick pay benefits. Furthermore, a tripartite agreement has been reached on the allocation of funds to trainees, who are at risk of not getting work placements. (II) The Labour Court referred to CJEU rulings in cases Süzen and CLECE when ruling in a case concerning cleaning companies. ______1 National Legislation 1.1 Measures to respond to COVID-19 crisis Danish society was partially locked down by the government on 11 March 2020 in response to the outbreak of the COVID-19 pandemic. As of 15 April 2020, a partial opening of society began due to the relatively low number of intensive care patients. As of 15 June 2020, society has opened up to a larger degree, while there are still restrictions on large gatherings, social distancing, as well as closed borders to/from many countries. In connection with the opening of society, new legislative measures continue to be taken to mitigate the financial consequences of the COVID-19 pandemic. Both legislation and tripartite agreements are included in this section.

1.1.1 Final extension of salary compensation to workers The government, the Danish Confederation of Trade Unions (hereinafter: FH) and the Danish Employers’ Confederation (hereinafter: DA) have agreed on an extension of the state-financed temporary salary compensation scheme to employers facing the risk of redundancies. The scheme has been extended and will expire on 29 August 2020. For companies that are still prohibited from opening their businesses, the scheme will expire when the prohibition is lifted. Employees are required to take up to 15 days of leave in the summer period during which the company cannot receive salary compensation. The compensation scheme applies to all private companies that anticipate that they will have to give notice of redundancies for at least 30 per cent of their work force or more than 50 employees. The scheme is available on the conditions that employees are sent home from work on their full salary, and that the company does not dismiss any workers on economic grounds during the salary compensation period. A press release relating to this issue is available here.

1.1.2 Solution for particularly vulnerable workers In connection with the re-opening of society, some employees are at risk of serious complications if they contract the COVID-19 virus. The solution has been to offer particularly vulnerable employees protection through sick leave benefits. Parliament has adopted Act No. 190 of 20 May 2020 that allows for particularly vulnerable employees and their close relatives to stay home from work during the re-opening of society, while

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receiving pay or sick leave benefits. The scheme currently ceases on 01 September 2020.

1.1.3 Allocation of funds to trainees and work placements A tripartite agreement between the government, the FH and the DA allocates a sum of DKK 5.4 billion (approx. EUR 724 000 000) for extraordinary measures to help trainees. Trainees, who attend work placements within a vocational scheme, are at risk of not getting work placements and not finishing their education due to the financial situation of many companies. One of the measures is salary compensation to companies that employ trainees. The scheme is funded by means of AUB, which is an employer’s reimbursement system. A press release on this issue is available here.

1.1.4 Whistleblower scheme against fraud with help packages Parliament has adopted a whistleblower scheme specifically to avoid fraud involving the state-financed emergency measures in connection with the COVID-19 pandemic (Act No. 198 of 04 June 2020). The scheme allows for anonymity of the informant due to the extraordinary situation and large sums involved, which is not otherwise possible according to Danish law. The Act also prohibits any detrimental treatment of employees who have made use of the whistleblower scheme, and provides a legal basis for economic compensation in case of unlawful actions by the employer.

1.2 Other legislative developments Nothing to report.

2 Court Rulings 2.1 Transfer of undertakings Danish Labour Court, 04 March 2020 The case concerned the question whether a transfer of an undertaking had taken place with the consequence that an employee, who was terminated, could claim salary compensation during the notice period as well as severance pay from the transferee. The employee had been employed in a cleaning company that provided cleaning services to a food production factory. The cleaning service was subject to a new tender, and a new cleaning company won the tender. At the time of the (potential) transfer, two employees were employed in the first cleaning company: a full-time cleaner and a part- time cleaner. The new cleaning company chose to employ the full-time employee, but not the part-time employee. As regards assets, the new cleaning company bought an industrial cleaning machine from the first cleaning company, and used washing machines owned by the food production factory on the same terms that the first cleaning company had. The Labour Court carried out an overall assessment of all the details and determined that the situation constituted a transfer of undertaking, in the understanding of the Act on Transfer of Undertaking implementing Directive 2001/23/EC. The Labour Court used the criteria promoted by the CJEU in the case of Süzen, and applied a broad interpretation of the scope of the Act in light of the social purpose of the Directive and the implementing Act. It was of no relevance that the employee, who continued working

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for the new cleaning company, had chosen to do so on his own account and in direct agreement with the new cleaning company.

3 Implications of CJEU Rulings and ECHR 3.1 Transfer of undertakings CJEU case C-298/18, Grafe und Pohle, 27 February 2020 The German bus company SBN decided to not submit a bid in the tender for the public bus service that it used to perform. Bus drivers Mr Grafe and Mr Pohle were terminated in January 2017. The bus company OSL was awarded the contract to perform the public bus service with effect from 01 August 2017. OSL recruited the majority of SBN’s drivers and management staff. None of SBN’s buses were taken over by OSL. Mr Grafe was employed by OSL from 01 September 2017. He challenged SBN’s termination of his employment relationship and submitted that OSL had to take his earlier periods of service into account to determine his seniority, as his employment relationship had been transferred from SBN to OSL. Mr Pohle was not employed by OSL. He challenged his termination by SBN and claimed compensation under SBN’s social plan. SBN asserted that his employment relationship had been transferred to OSL in connection with the tender. OSL relied on the CJEU ruling Liikenne to determine that no transfer of an undertaking had taken place, as no buses had been taken over. SBN provided information that their buses did not live up to the tender’s technical and environmental requirements. The Court found that this does not necessarily preclude classification as a transfer of an undertaking in the understanding of Article 1(1) of Directive 2001/23/EC, that operating resources (buses) have not been taken over, when legal, environmental and technical constraints are imposed by the contracting authority. In such situations, other factual circumstances, such as the taking over of the majority of employees and the uninterrupted pursuit of the activity, make it possible to establish that the economic identity has been retained. This would be a matter for the referring court to assess. The ruling may have implications for Danish law. The Danish courts have interpreted cases on transfers of undertakings in conformity with CJEU case law. Liikenne in particular has been referenced in cases involving the transfer of bus services. No recent case law has dealt with the applicability of the Danish Act on Transfers of Undertakings, where a lack of a transfer of assets is due to legal, environmental and technical constraints. The consequence of the ruling is that it will no longer suffice to evaluate whether equipment, assets, etc. have been taken over by a business, where assets are essential for the operation. It will also be necessary to assess whether the lack of a transfer of assets is due to legal, environmental and technical constraints. In such cases, the courts will be expected to take other factual circumstances in connection with the transfer into consideration, making it possible for the identity of the business to be retained, even though no assets are transferred. In essence, a new test is introduced for the Danish courts to apply. As the Danish courts diligently refer to CJEU case law in cases involving transfers of undertakings, Danish courts are expected to comply with the new test introduced, when relevant cases come before .

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CJEU case C-344/18, ISS Facility Services, 26 March 2020 Ms Govaerts was a project manager employed by ISS to oversee work corresponding to three lots in the City of Ghent. ISS lost a new tender to clean the three lots. The tender was awarded to two companies, which took over the cleaning services of the three lots, Company 1 took over one lot, Company 2 took over two lots. The question concerned which of the two new companies was obligated to take over the employment of Ms Govaerts. ISS claimed that it was Company 2’s responsibility, because they had taken over most of Ms Govaerts’ work. This was disputed by Company 2. It was undisputed before the CJEU that a transfer in the meaning of Directive 2003/21/EC had taken place. The question was how to transfer the rights and obligations of the employee to the transferee in situations involving multiple transferees. The Court found that Article 3(1) of Directive 2003/21/EC does not envisage a situation in which a transfer involves a number of transferees. The Court, on the one hand, rejected that a transfer to several transferees results in a situation in which the rights and obligations arising from the contract of employment cannot be asserted against either of the transferees, as this would deprive the Directive of its effectiveness. On the other hand, the rights and obligations cannot be transferred solely to the transferee for whom the employer would principally work, as this would discount the interests of that transferee. Instead, the employee’s rights and obligations must be transferred to each of the transferees pro rata, i.e. in proportion to the tasks performed by the worker concerned, i.e. a division of the employment of Ms Govaerts. However, if a division of the employment is impossible to carry out or if it will adversely affect the rights of that worker, the transferees will be regarded as being responsible for any consequent termination of the employment relationship, also if the termination is initiated by the worker. The ruling may have implications for Danish law. There is no clear case law from the Danish courts dealing with transfers involving multiple transferees. There is, however, case law for a transfer that involved multiple transferors, cf. Labour Court ruling, No. AR2015.0171, 03 February 2016. In this case, the Labour Court ruled that it had to be assessed for each transferor separately whether the identity had been retained following the new tender. If no employees were taken over, there was no transfer of undertaking. The Danish courts will have to apply the interpretation of the Court in similar cases.

4 Other Relevant Information Nothing to report.

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Estonia

Summary (I) The salary subsidy – a measure introduced by the state to respond to the COVID- 19 crisis – will also be guaranteed for June, although the state of emergency in Estonia has ended. (III) Trade unions would like to see higher fines for violations of labour laws. (IV) Employers would like to modify working time regulations to guarantee necessary flexibility. ______1 National Legislation 1.1 Measures to respond to COVID-19 crisis 1.1.1 Salary subsidy for employers A salary subsidy was introduced in response to the COVID-19 crisis. This subsidy was meant to apply for three months, namely March, April and May. The government has decided that this subsidy will also be provided for the month of June. Whether it will continue after June is not yet clear. The subsidy is paid in June 2020 if the employer has suffered a decline in turnover or revenue of at least 50 per cent compared to the month of June of the previous year. In addition, they must comply with at least one of the following terms:  The employer is not able to provide at least 50 per cent of its employees with work and the employees’ work load has decreased by at least 30 per cent;  The employer has cut the wages of at least 50 per cent of its employees by at least 30 per cent or down to the minimum wage. The employer must have reduced employees’ wages or work load for the entire month of June. The subsidy is only paid for employees who have been employed under an employment contract. Both private and state organisations are eligible for the subsidies, independent of the size of the organisation. An employer can apply for the salaries of contracted employees to be subsidised if the contract was signed before 01 March 2020. Subsidies will be paid to employees whose employers are not able to provide them with work or whose wages have been reduced. The amount of the subsidy will be 50 per cent of the employee’s average monthly wage. The maximum amount of the subsidy is EUR 800. In addition, the employer must pay a wage of at least EUR 150 to the employee. The employer must make the payment before applying for the subsidy. The employee will receive at least the minimum wage of EUR 584 from the Unemployment Insurance Fund and the employer, collectively. In case the employee has thus far received less than the minimum wage due for part-time work, his/her income will remain the same as before. The Unemployment Insurance Fund will pay social security, unemployment insurance tax and mandatory funded pension, as well as income tax on the subsidy, while the employer will pay the aforementioned taxes on the employee’s wage. If the employer

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terminates the contract with the employee due to redundancy in June or in the course of two following calendar months, the subsidy is to be returned to the Fund.

1.2 Other legislative developments Nothing to report.

2 Court Rulings Nothing to report

3 Implications of CJEU Rulings and ECHR 3.1 Transfer of undertakings Case C-298/18, Grafe und Pohle, 27 February 2020 The present case concerns aspects of transfers of undertakings. The main question in this case was whether only the transfer of the majority of employees (in this case bus drivers) constitutes a transfer of an undertaking, if the necessary technical equipment is not transferred. The CJEU confirmed that in case technical equipment is not transferred due to legal, technical or environmental requirements, it does not exclude that a transfer of an undertaking has taken place when the majority of employees is transferred. This case has implications for case law by providing a better understanding of the notion of transfer of an undertaking and protecting the rights of employees in case of a transfer of an undertaking. According to the case law of the Estonian Supreme Court (Riigikohus), in order to determine whether a transfer of an undertaking has taken place or not requires an overall assessment of the circumstances.

CJEU case C-344/18, ISS Facility Services, 26 March 2020 This case dealt with a transfer of an undertaking and the protection of an employee in a situation in which the employee’s tasks could be divided between different employees. If the proportion of tasks that have been transferred can be determined, it is also possible to continue the employment contract’s fulfilment. If the division of the employment contract between different new employers is not possible or if the employment conditions will worsen, the transferee(s) would be responsible for any consequent termination of the employment relationship. The case has important implications for Estonian labour law. The case law of the Estonian Supreme Court (Riigikohus) has thus far not dealt with such a situation. The Estonian legal literature also does not discuss such a situation.

4 Other Relevant Information 4.1 Necessity to change working time regulation According to the Estonian Employers Confederation, the COVID-19 crisis has demonstrated the need to change the working time regulation in Estonia. The options for part-time employment need to be regulated. At present, the Employment Contracts Act requires the working time regulation to specify the exact number of hours an employee must work. There is no possibility to agree on a range of working hours an employee can be employed, e.g. to specify that the employee’s working time is 20 – 30

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hours a week. This possibility could provide the necessary flexibility. Such a regulation could also avoid the need to conclude contracts (e.g. contracts for services) instead of employment contracts. An assessment of this issue by the Estonian Employers Association is available here.

4.2 Trade unions want effective punitive measures The Estonian Trade Unions Confederation submitted a proposal to the Ministry of Social Affairs to amend administrative fines for violations of labour law regulations. At present, the amount of fines the labour inspectorate can apply is between EUR 400 – 1 300. The same amount of fines also applies e.g. for violations of the Trade Unions Act. According to the trade unions, such fines are not effective and need to therefore be changed (increased). There is no concrete draft of a law to change the amount of fines the labour inspectorate can apply. More information on this proposal of the Estonian Trade Union Confederation is available here.

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Finland

Summary (I) The government enacted a decree on temporary amendments to labour legislation in response to the COVID-19 crisis in May. This decree allows deviations of certain provisions of the Employment Contracts Act, Annual Holidays Act and Working Hours Act and related collective agreement provisions. (II) A judgment on a transfer of an undertaking was issued by the Supreme Court, and it followed the well-established jurisprudence of the CJEU. (III) A government proposal for the implementation of the renewed Posted Workers Directive has been submitted to Parliament. A draft Government Proposal, which contains plans for a reform of labour legislation on non-competition clauses, has been circulated for comments. ______1 National Legislation 1.1 Measures to respond to COVID-19 crisis 1.1.1 COVID-19 related exceptions to labour legislation A Government Decree on temporary deviations to the application of certain provisions of the Annual Holidays Act, Working Hours Act and Employment Contracts Act came into force on 14 May 2020 and will expire on 30 June 2020. The decree allows deviations from mandatory labour legislation due to the coronavirus pandemic. The decree is based on the Emergency Powers Act, the purpose of which is to secure the livelihood of the population and protect the national economy, to maintain legal order and fundamental and human rights, and to safeguard the territorial integrity and independence of Finland in a state of emergency. The decree can be applied if it is not possible to ensure a sufficient work force so that the Annual Holidays Act, the Working Hours Act and the Employment Contracts Act’s Chapter 6, Section 3:2 can be applied. These exceptions only apply where it is necessary to ensure the employer’s continued operations and they have to be proportionate in terms of the aims these exceptions seek to achieve. The employer can deviate from the provisions of the Annual Holidays Act and related collective agreement provisions on the announcement of annual leave, transfer the time of already notified annual leave and interrupt an already started annual holiday stipulated in the Annual Holidays Act. However, these measures cannot endanger the employees’ occupational health and safety. In addition, the annual leave days that the employee was not able to use have to be offered to the employee as soon as possible. Moreover, the employer can request employees to work overtime without their approval and deviate from the provisions of the Working Hours Act and related collective agreement provisions on the weekly and daily rest periods as well as from the provisions on maximum working time in the Working Hours Act. However, these measures may not endanger the employees’ occupational health and safety. The employer has to balance the additional strain caused by the work and provide employees the opportunity to recover from the stress caused by the extra work. The employer can extend the term of notice set out in the Employment Contracts Act and related collective agreement provisions for a maximum of four months if necessary to ensure employee’s health, minimum income or safety.

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1.2 Other legislative developments 1.2.1 Posting of workers A Government Proposal to implement the renewed Posted Workers Directive (EU) 2018/957 has been submitted to Parliament. A tripartite working group prepared the proposal, which shall implement the Directive and make use of the possibility to extend the list of applicable terms and conditions of work in Article 3.1 provided in Article 3.10 of the Directive. This proposed amendment would introduce a protective provision for travel and accommodation costs arising from a posted worker’s posting to Finland. The provision would only apply in situations where the posted worker is not entitled to protection on the basis of the law or standard practice of the country of origin or the employment contract, or where the protection would remain substantially below what is considered normal and reasonable for the work in question in Finland. Parliament is currently discussing the Government Proposal.

1.2.2 Non-competition clauses A draft Government Proposal contains plans to reform labour legislation on non- competition clauses. A tripartite working group has prepared draft the legislative amendments that would extend the employer’s obligation to pay compensation to an employee for a non-competition agreement to cover all non-competition agreements. The draft Government Proposal was circulated for comments to be submitted by 22 May 2020.

2 Court Rulings 2.1 Transfer of Undertakings Supreme Court, No. 2020:8, 29 January 2020 The case concerned the dismissal of a civil servant who had been working for a commercial undertaking of the municipality. The staff had been transferred following the transfer of the undertaking to work for the company that had been established. According to the Supreme Court, the judgment of the CJEU in Collino and Chiappero, C- 343/98, confirms that civil servants are not workers as referred to in Directive 77/187/EEC and the benefits based on the Directive only apply to workers who are protected as employees under the national legislation. As Directive 2001/23/EC does not include a broader concept of employee than that of Directive 77/187/EEC, the CJEU’s jurisprudence based on Directive 77/187/EEC must thus be followed.

3 Implications of CJEU Rulings and ECHR 3.1 Transfer of undertakings CJEU case C-298/18, Grafe und Pohle, 27 February 2020 The CJEU held that Article 1(1) of Directive 2001/23/EC must be interpreted as meaning that, in the context of the takeover by an economic entity of an activity, the pursuit of which requires substantial operating resources, under a procedure for the award of a public contract, the fact that that entity does not take over those resources, which are the property of the economic entity previously engaged in that activity, on account of legal, environmental and technical constraints imposed by the contracting authority, cannot necessarily preclude the classification of that takeover of activity as a transfer of an undertaking, since other factual circumstances, such as the taking over of the majority of the employees and the pursuit, without interruption, of that activity, make

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it possible to establish that the identity of the economic entity concerned has been retained, this being a matter for the referring court to assess. This judgment does not require any amendments to the Employment Contracts Act. Its provisions on transfers of undertakings are interpreted in line with the CJEU’s jurisprudence.

CJEU case C-344/18, ISS Facility Services, 26 March 2020 The Court ruled that Article 3(1) of Directive 2001/23/EC must be interpreted as meaning that the rights and obligations arising from a contract of employment are transferred to each of the transferees, in proportion to the tasks performed by the worker concerned, provided that the division of the contract of employment as a result of the transfer is possible and neither causes a worsening of working conditions nor adversely affects the safeguarding of the rights of workers guaranteed by that Directive, which it is for the referring court to determine. If such a division were impossible to carry out or would adversely affect the rights of that worker, the transferee(s) would be regarded as being responsible for any consequent termination of the employment relationship under Article 4 of that Directive, even if that termination were to be initiated by the worker. This judgment does not require any amendments to the Employment Contracts Act. Its provisions on transfers of undertakings are interpreted in line with the CJEU’s jurisprudence.

4 Other Relevant Information Nothing to report.

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France

Summary (I) Several laws, ordinances and decrees have been issued in response to the COVID-19 pandemic. (II) The Data Protection Authority (Commission Nationale de l'Informatique et des Libertés - CNIL) published a manual for employers on its website on 07 May 2020. ______1 National Legislation 1.1 Measures to respond to COVID-19 crisis 1.1.1 Law n°2020-546 on the extension of the State of Health Emergency A state of health emergency (Etat d’urgence sanitaire) was declared for a period of two months from the entry into force of Emergency Law No. 2020-290 of 23 March 2020 published on 24 April (until 24 May 2020). Law No. 2020-546 of 11 May (JO 12 May) extends the state of health emergency until 10 July 2020. As a reminder, during this period, the Prime Minister was authorised to use “the power to declare, by decree and upon recommendation of the , general measures setting limits to the , the freedom to enterprise and the freedom to congregate and allow him to proceed to the requisition of all necessary goods and services to fight against a health crisis” This extension will impact certain deadlines that have been suspended by previous ordinances. For example, the suspension of the works council (hereinafter: CSE) election (which started before 03 April), provided by Ordinance No. 2020-389 dated 01 April (see 1.3).

1.1.1.1 Protection against dismissal of employees in compulsory quarantine The quarantine of persons likely to be affected by COVID-19 because they visited an area with a high rate of COVID-19 during the previous month, as well as placement in isolation of persons affected by COVID-19, may be compulsory for persons arriving on national territory, overseas collectivities or in Corsica (Article L. 3131-15 of the Public Health Code). Employees placed in compulsory quarantine benefit, since 13 May, from the provisions on the suspension of the employment contract in the event of an accident at work or an occupational disease provided for in Article L. 1226-9-1 of the Labour Code. Only employees entering the national territory, overseas collectivities or Corsica and placed in quarantine because they have arrived from a ‘contaminated zone’ are concerned. In addition, the duration of the periods of suspension of the contract related to this quarantine shall be taken into account to determine any legal or contractual benefits, and may not result in any delay in the promotion or progress for the person concerned.

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1.1.1.2 Quarantine: no impact on the distribution of profit-sharing schemes It should be recalled that in France, there are two types of profit-sharing schemes: (1) ‘Participation’ which is a mandatory scheme for all companies with at least 50 employees ; (2) ‘Intéressement’ which is optional (optional profit-sharing scheme). As a general rule, all employees benefit from the mandatory profit-sharing scheme. This includes employees on fixed-term or indefinite contracts, but not interim workers or interns. A three-month length of service condition can be included. The pool can then be divided:  In proportion to wages; or  equally between employees; or  in proportion to working time; or  using a mix of these criteria. The period of presence corresponds to periods of ‘effective work’, to which periods legally considered effective work and paid as such (paid leave, exercise of staff representation mandates). Periods of maternity leave (Article L. 1225-17 of the Labour Code), adoption leave (Article L. 1225-37 of the Labour Code) and suspension of the employment contract due to an occupational disease or an accident at work (Article 1226-7 of the Labour Code) are also considered periods of presence. A new period has now been added to this list: periods of quarantine within the meaning of 3° of I of Article L. 3131-15 of the Public Health Code. The law extending the state of public health emergency provides for these quarantine periods to be considered periods of presence for the distribution of profit-sharing plans according to the beneficiary's period of presence.

According to Article L. 3131-15 of the Public Health Code, the only employees concerned are those entering the national territory, overseas collectivities or Corsica and placed in quarantine because they have arrived from a ‘contaminated zone’.

1.1.2 Extension of the partial activity scheme The French Amending Finance Law No. 2020-473 of 25 April 2020 (JO 26 April), provides for the extension of the partial activity scheme, as of 01 May 2020, to employees who were previously covered by exceptional sick leave. As a reminder, the partial activity scheme may be requested by businesses facing exceptional circumstances, such as the COVID-19 pandemic, pursuant to Article R. 5122-1 of the Labour Code. Employees who, while remaining bound to their employer by an employment contract, suffer a loss of wages due either to the temporary closure of all or part of the establishment or to the reduction of working hours, usually practiced in the establishment below the legal duration of work, benefit from a specific allowance. Some employees were able to benefit from a special work stoppage (no minimum duration of activity or contributory conditions, no waiting period), even though they did not suffer from any COVID-19-related disease. The employees eligible for daily sickness benefits are:  employees who are parents of a child under the age of 16 or of a person with a disability who is subject to a measure of isolation, eviction or home care.

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 employees at risk according to Decree No. 2020-521 of 05 May 2020, which specifies the criteria to identify vulnerable employees who present a risk of developing a serious form of COVID-19 and who may benefit from the partial activity scheme pursuant to Article 20 of Law No. 2020-473 of 25 April 2020 or living with vulnerable persons. From 01 May 2020, Law No. 2020-473 provides that these employees will automatically benefit from the partial activity scheme under the condition that they are still unable to work. The authorisation of the administrative authority is not required for the placement of these employees in partial activity. This partial activity allowance cannot be combined with the daily social security allowance and any additional compensation paid by the employer.

1.1.2.1 Duration of the partial activity scheme For vulnerable employees or employees sharing their home with vulnerable persons, this measure will apply as of 01 May 2020 until a date to be set by decree and no later than 31 December 2020. For parents of a child under the age of 16 or of a disabled person who is subject to a measure of isolation, eviction or home care, partial activity shall apply as of 1 May 2020 and for the entire duration of the measure of isolation, eviction or home support for their child or the disabled person.

1.1.3 Ordinance on the deadlines for professional elections Law No. 2020-546 of 11 May 2020, having extended the state of health emergency until 10 July, Ordinance No. 2020-560 of 13 May 2020 (JO 14 May), draws the consequences and modifies the deadlines for professional elections. The ordinance amends, in particular, the provisions of Ordinance No. 2020-389 of 01 April 2020. By an ordinance dated 01 April 2020 on emergency measures on staff representative bodies (hereinafter: IRP), the government temporarily suspended the ongoing CSE election processes. In accordance with the initial end of the state of health emergency, the CSE election initiated before 03 April 2020 was suspended from 12 March 2020 to three months after the end of the state of health emergency, i.e. 24 August (24 May + 3 months). Henceforth, any electoral process initiated before 03 April has been suspended from 12 March until 31 August 2020. This suspension affects all deadlines related to the electoral process. The ordinance provides that this suspension impacts:  the timeframe for employers to organise elections (Articles L. 2314-4, L. 2314- 5, L. 2314-8 and L. 2314-29 of the Labour Code);  the timeframe within which disputes relating to the elections must be submitted before the administrative authority and the judicial judge (Articles R. 2313-1, R. 2313-2, R. 2313-4, R. 2313-5 and R. 2314-3 of the Labour Code);  the timeframe for the administrative authority to decide on these disputes (Articles R. 2313-2, R. 2313-5 and R. 2314-3 of the Labour Code). In addition, the employer must organise the CSE elections (Article L. 2314-4 of the Labour Code) "on a date freely determined by the employer between 24 May and 31 August 2020, without this date being earlier than the date on which the employer is obliged to initiate this procedure" (Articles 9, 2° a and b):

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 if, between 03 April and 31 August 2020, the employer was required to implement the electoral process, either due to reaching the workforce threshold (Article L. 2311-2 of the Labour Code), a request from an employee or a trade union organisation (Article L. 2314-8 of the Labour Code), or by-elections (Article L. 2314-10 of the Labour Code);  or when, prior to 03 April 2020, the employer has not initiated the electoral process when required to do so under these same articles of the Labour Code.

1.1.4 Ordinance on the deadlines for consulting and informing the CSE Ordinance No. 2020-507 of 02 May 2020 (JO 03 May) temporarily adapts the deadlines applicable to the consultation and information of the CSE to deal with the COVID-19 pandemic, supplemented by Decree No. 2020-508 and Decree No. 2020-509, also dated 02 May 2020 (JO 03 May).

These three texts modify and complete Article 9 of Ordinance No. 2020-460 of 22 April 2020 on the CSE’s information and consultation procedures bearing exclusively on the employer's “decisions aimed at dealing with the economic, financial and social consequences of the spread of the COVID-19 pandemic.” These deadlines apply from 03 May until 23 August 2020. However, when the periods that started running before 03 May 2020 have not yet expired, the employer has the option of interrupting the procedure in progress and starting, from that same date, a new procedure of consultation in accordance with the rules provided for by the Ordinance of 02 May 2020. These deadlines are not applicable to CSE information and consultations on the following subjects:  Job preservation scheme/plan (dismissal of 10 or more employees within the same 30-day period);  collective performance agreement (Article L. 2254-2 of the Labour Code);  the recurring information and consultation procedures provided for in Article L. 2312-17 of the Labour Code.

1.1.4.1 Deadline for communicating the agenda In this case, the deadline for communicating the agenda meetings is reduced from 3 to 2 calendar days (and from 8 to 3 days for the central CSE).

1.1.4.2 Consultation period In the absence of expert intervention (Article R. 2312-6 of the Labour Code), the deadline for the CSE to issue its opinion is reduced from 1 month to 8 days. In the event of an expert intervention (Article R. 2312-6 of the Labour Code), this period ranges from 2 months to 11 days (12 days for the central CSE). In the event of an intervention of one or more expert opinions within the framework of a consultation that takes place both at the level of the central CSE and one or more establishment CSEs, the consultation period increases from 3 months to 12 days. Finally, the minimum period between the of the opinion of each establishment CSE to the central CSE, and the date on which the latter is deemed to

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have been consulted, and to have given a negative opinion has been reduced from 7 days to 1 day.

1.1.4.3 Expertise The expert has a period of 24 hours from his/her designation to ask the employer for any additional information he/she deems necessary for the accomplishment of its mission (as opposed to 3 days under normal circumstances). The deadline for the employer to respond to this request is 24 hours instead of 5 days (Article R. 2315-45 of the Labour Code). Then, the expert must notify the employer of the estimated cost, scope and duration of the expertise within 48 hours of his/her designation (instead of 10 days) or, if a request has been sent to the employer, within 24 hours of the response given (Article R. 2315- 46 of the Labour Code). The period available to the employer to turn to the courts in the event of a dispute increases from 10 days to 48 hours (Article R. 2315-49 of the Labour Code). Finally, the minimum period between the expert's submission of the report and the expiry of the CSE consultation deadlines decreases from 15 days to 24 hours (Article R. 2315-47 of the Labour Code).

1.1.5 Partial activity allowance for certain groups of employees Decree No. 2020-522 of 5 May 2020 specifies the rules for calculating the indemnity and partial activity allowance for senior executives (cadres dirigeants) and employees who carry out their activity in an umbrella company. This decree completes Decree No. 2020-435 of 16 April 2020.

1.1.5.1 Senior executives Senior executives, in accordance with Article L. 3111-2 of the French Labour Code, may only be placed in partial activity if it results in a reduction in working hours below the legal duration in all or part of the establishment where this executive is assigned. The senior executive is excluded when the partial activity results in the closure of the establishment. In other words, senior executives may only benefit from the partial activity scheme in the event of a temporary closure of their establishment or part of the establishment. A decree is expected to specify the methods for calculating this allowance. The indemnity and partial activity allowance of senior executives placed in partial activity are calculated based on the following parameters :  the monthly reference remuneration corresponds to the average gross remuneration received during the last 12 calendar months, or where applicable, all calendar months worked if the employee has worked less than 12 months, preceding the first day of partial activity of the company or establishment;  the hourly amount is determined by dividing one-thirtieth of the amount of the monthly reference salary by 7 hours;  the number of compensable non-working hours, within the limit of the legal working time, is obtained in the same manner of conversion into hours as for employees with an annual working days agreement (half a non-working day

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corresponds to 3:30, a day not worked corresponds to 7 hours and a week not worked corresponds to 35 hours).

1.1.5.2 Employees in umbrella companies (Portage salarial) For employees employed under a permanent contract by an umbrella company, periods without the provision of services to a client company (which are not, in principle, remunerated) give entitlement to compensation and partial activity allowance due to the COVID-19 epidemic according to the following calculation methods:  the number of compensable hours corresponds, within the limit of the legal working time over the period considered, to the monthly average of the hours or days worked during the 12 calendar months (1 day worked corresponds to 7 hours worked);  The monthly reference remuneration used to calculate the allowance and the partial activity allowance corresponds to 75 per cent of the monthly value of the social security ceiling for an activity equivalent to full time (and in due proportion when the activity is less);  The hourly amount used to calculate the indemnity and allowance is determined by relating the amount of the monthly reference salary to the average monthly hours worked, referred to above.

1.2 Other legislative developments Nothing to report.

2 Court Rulings Nothing to report.

3 Implications of CJEU Rulings and ECHR 3.1 Transfer of undertakings Case C-298/18, Grafe und Pohle, 27 February 2020 In the judgment Grafe und Pohle (C-298/18), the CJEU ruled on the transfer of scheduled public bus transport, clarifying its judgment Liikenne (C-172/99) of 25 January 2001. The provisions of Council Directive 2001/23/EC have been transposed in French law in Articles L.1224-1 and L.1224-2 of the Labour Code. Article L.1224-1 of the Labour Code is considered to be part of public law. Therefore, the employment contract's transfer is mandatory for both the transferee and the employees who cannot refuse the change of employer. Notion of “transfer of an undertaking” According to Article L.1224-1 of the Labour Code “In the event of a change in the employer’s legal situation, notably, as a result of inheritance, sale, or merger of the undertaking, a change in its legal form or its , all employment contracts in force on the date of this change in the employer’s legal situation continue between the new employer and the undertaking’s staff”.

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However, this list is not exhaustive and courts must examine the circumstances as a whole to determine whether a transfer of an economic entity has occurred. Indeed, in addition to cases of transfers of assets expressly listed under the relevant provision of the Labour Code, the notion of ‘transfer of an undertaking’ has been extended by the Cour de Cassation to similar situations. The Cour de Cassation defines the general notion of a transfer as "a transfer of an autonomous economic entity that keeps its identity and whose business is continued after the transfer" (Cass. Plén. 16 March 16, n°86-40.686). Thus, the implementation of Article L. 1224-1 in the event of a change in the legal situation is subject to two conditions:  the existence of an autonomous economic entity;  Continuation of this activity by a new entity, without any modification made to its ‘identity’. It is well-established that these conditions are cumulative and consequently, taking over assets remains an element without which Article L.1224-1 of the Labour Code cannot apply: “Merely having another company continue the same activity is not sufficient for there to be a recognised transfer of an autonomous economic entity” (Cass. soc., 26 June 2008, No. 07-41.294). French case law is quite demanding as regards the nature of the assets transferred by the transferor to the transferee. Indeed, the judges require substantial assets to be transferred in order for Article L. 1224-1 to apply. By contrast, the CJEU has ruled that in the case of labour-intensive undertakings, the economic entity may be characterised by a group of workers that is permanently united by an activity. Thus, it must be accepted that such an entity is likely to maintain its identity beyond its transfer, when the new head of the undertaking not only continues the activity in question, but also takes over an essential part, in terms of number and competence, of the workforce which his/her predecessor had assigned specifically to this task. This solution, in which the transfer of the workers is an essential condition for the definition of the economic entity in manpower undertakings, has been affirmed by Community case law (CJEU, 10 December 1998, case C-173/96, Sanchez Hidalgo et al. and CJEU, 02 Dec. 1999, case C-234/98, Allen et al. v. Almalgamated Construction Co. Ltd and a.). In France, Article L.1224-1 of the Labour Code applies to any transfer of an autonomous economic entity defined as “an organised grouping of individuals and tangible or intangible assets that enables the continued running of an economic activity with its own objective” (Cass. soc., 07 July 1998, No. 96-21.451). For example, in order to characterise such a transfer, the Court ruled that it is necessary for the succession of companies be accompanied at the same time by a transfer of the means of operation (e.g. machinery, premises, land, equipment), making it possible to conclude that the essential features of the undertaking in question are being continued (Cass. soc., 13 December 1995, No. 94-40.816). In addition, the French judges ruled that Article L. 1224-1 of the Labour Code is not applicable to the situation of an undertaking which hitherto provided industrial cleaning, collecting, sorting of industrial waste, handling and technical assistance on the site of an airport and which lost the public contract, in the absence of any transfer of organised groups of workers and tangible or intangible assets (Cass. soc., 21 November 2000, No. 98-45.837). Moreover, judges have repeatedly held in cases relating to the cleaning sector that neither the loss of a public contract nor the continuation of the related activity by the principal, following the termination of the contract, can be sufficient, in the absence of any transfer of significant tangible or intangible assets, to lead to a change of employer (Cass. soc., 12 June 2007, No. 06-41.988).

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In specific cases, a transfer of clients without the means of carrying out a business may be regarded as a transfer of an economic entity. For example, the transfer of the clients of a law firm, which constitutes the essential element of that entity, entails the transfer of the employment contracts of that firm’s employees (Cass. soc., 25 September 2007, No. 06-41.892). Nevertheless, in France, businesses that rely on manpower and do not use material assets are usually not considered to characterise an economic entity for the purpose of the application of Article L. 1224-1 of the Labour Code, whereas the ECJ has accepted to apply the Directive to this type of activities. In the Grafe und Pohle judgment, the Court of Justice refers to its 2001 case law judgment of 25 January 2001 (C-172/99) and points out that, although it stated at that time that bus transport cannot be regarded as an activity based essentially on manpower, as it requires substantial plant and equipment, it could not be inferred from its judgment that the takeover of the buses must be considered in the abstract as the sole determining factor of whether an undertaking whose activity consists in the public transport of passengers by bus. The Court then stated that if the lack of transfer of such operating resources results from legal, environmental or technical constraints, it does not necessarily preclude the classification of a transfer as a ‘transfer of an undertaking’ within the meaning of Directive 2001/23/EC. Thus, even if the new contractor of the bus services did not take over any buses from the previous operator, depots and other operating facilities, or the use of its workshop services, the Court ruled that other factual circumstances, such as the taking over of the majority of the employees and the pursuit, without interruption, of that activity, make it possible to establish that the identity of the economic entity concerned has been retained.

CJEU case C-344/18, ISS Facility Services, 26 March 2020 The Court of Justice delivered its judgment in a Belgian case where, for the first time, it was called upon to rule on the employees' rights and obligations in the context of a transfer of an economic entity to several transferees.

In France, the Court de Cassation has never ruled on this matter.

4 Other Relevant Information 4.1 Data Protection Authority manual for employers The French Data Protection Authority (Commission Nationale de l'Informatique et des Libertés, hereinafter: CNIL) has expressed its views on various issues relating to the consequences of the pandemic on the processing and protection of personal data and on its monitoring. The manual recalls the rules for the collection and processing of such data in accordance with the General Data Protection Regulation (hereinafter: GDPR), the French Data Protection Law, stressing the need to rely on occupational health services. Data relating to a person's state of health, as so-called ‘sensitive data’, are subject to special legal protection. They are, in principle, prohibited from being processed (Article 9.1 of the GDPR). However, it may be authorised in a limited number of cases (in particular, in the case of explicit consent). Article L. 1121-1 of Labour Code lays down the general rule on the possibility of restricting individual and collective freedoms in the workplace. However, these

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restrictions must be justified by the nature of the task to be performed and proportionate to the aim being pursued.

2.1.1 Employers’ safety obligations The manual further states that employers are responsible for the health and safety of their employees. Pursuant to Article L. 4121-1 of the Labour Code, the employer is responsible for the health and safety of its employees. In this respect, the employer must implement occupational risk prevention measures, information, and training actions, and set up an appropriate organisation and resources. Employers, in accordance with the GDPR, have the right to process personal data when it is strictly necessary to comply with their legal obligations. As part of its professional risk prevention actions, to deal with the current pandemic, the employer may do the following:  Raise awareness and invite employees to provide individual feedback to the employer or the competent health authorities regarding possible exposure to COVID-19;  Facilitate transmission of this information by setting up, if necessary, dedicated channels;  Promote remote working methods and encourage the use of occupational health services.

2.1.2 Employees’ safety obligations In accordance with Article L.4122-1 of the Labour Code, each employee must ensure that he/ she maintains not only his/her own health and safety, but also the health and safety of anyone with whom the employee may be in contact in the course of his/her professional activities. The manual states that employees who work in contact with others (colleagues and the public) must inform their employer in the event of infection or suspected infection with COVID-19 whenever they may have exposed some of their colleagues to the virus. However, an employee who is, for example, teleworking or working in isolation without contact with colleagues or the public does not have to report this information to his/her employer.

2.1.3 Employer’s reports Employers may therefore only process data that are strictly necessary for the fulfilment of their legal and contractual obligations, i.e. those necessary to take organisational measures (teleworking, referral to the occupational physician, etc.), training and information, as well as certain occupational risk prevention measures. In the event employees report (suspected) infections, employers may only process the following information:  the date and identity of the employee in question;  the fact that the employee reported the infection or suspected infection;  the organisational measures implemented by the employer.

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2.1.4 Body temperature checks The manual stresses that employers are currently not allowed to take the following measurements:  Body temperature readings of employees or visitors, if those readings are recorded by automated means or in a paper record; or  Automated capture or scanning of body temperature through tools such as thermal cameras. However, the manual states that employers would be allowed to check temperatures at the entrance to their premises, using a manual thermometer (such as a non-contact infrared thermometer), if no temperature data is recorded and there is no internal or external reporting of that information. If these conditions are met, employers are not processing any personal data and therefore, the checks would not be subject to the EU General Data Protection Regulation (“GDPR”). In any event, the CNIL reminds that in the event of a suspected infection, the person concerned must contact a health professional (occupational health services, attending physician, emergency services, etc.), who is the only person in a position to assess a person's ability to work or to decide on his/her care.

2.1.5 Serology tests and health status questionnaires The CNIL points out that only competent health personnel (in particular, occupational doctors) may collect, implement and access any medical files or questionnaires from employees containing data relating to their state of health or information relating in particular to their family situation, their living conditions or even their possible travels. Similarly, the results of serology tests are subject to medical professional secrecy. Employers may only know that employees are fit or unfit to work as issued by the health professional.

2.1.6 Business continuity plans Employers may need to establish a “business continuity plan” that aims to maintain the critical activities of their organisation in times of crisis. The plan must, in particular, include all necessary measures to protect the safety of employees and identify the critical activities that need to be maintained, as well as the people necessary to ensure business continuity. The organisation may then create a data file in order to set up and maintain the plan. Only necessary personal data may be processed to that end. The CNIL reminds that the employer must ensure the security and confidentiality of the data it processes in all cases: this is the case, for example, when sending proof of business travel that contains personal data and must only be communicated to the persons individually concerned.

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Germany

Summary (I) The Federal Government has submitted a draft law to amend the law on the posting of workers.

(II) The Federal Cabinet has adopted the key points of an occupational safety programme for the meat industry.

(III) According to the Federal Labour Court, there was no transfer of an undertaking with regard to so-called ‘wet lease’.

(IV) According to the Federal Administrative Court, the Evangelical Lutheran Regional Church of is to be involved in administrative procedures for authorising Sunday work in call centres. ______1 National Legislation 1.1 Measures to respond to COVID-19 crisis Nothing to report.

1.2 Other legislative developments 1.2.1 Posting of workers The Federal Government has submitted a draft law (19/19371) to amend the law on the posting of workers (Arbeitnehmer-Entsendegesetz, hereinafter: AEntG). According to this bill, nationwide, generally binding collective agreements will no longer only apply in the construction industry, but will also be “applicable in all sectors, according to the AEntG, to employers based abroad” if they employ workers in Germany. The draft bill also intends to ensure that, for example, overtime rates or allowances for dirty or hazardous working conditions as well as payments in kind by the employer must in future be paid for all employees working in Germany. The draft bill also intends to prevent any money received by employees to reimburse their expenses from being deducted from their pay. It also regulates, among other things, the requirements for accommodation provided by the employer. The planned new regulations will not apply to the road transport sector.

1.2.2 Health and safety A lack of occupational safety in some meat processing plants has led to an increase in corona infections. In response to this, the Federal Cabinet has adopted the key points of an occupational safety programme for the meat industry. Among other things, it provides for the following: customs and occupational safety authorities as well as local regulatory and health authorities are to take additional measures to ensure that occupational safety, infection and health protection standards are observed. As of 01 January 2021, the slaughtering and processing of meat will only be permitted by on staff. Civil contracts would thus no longer be possible. Fines for violations of the Working Hours Act will be increased.

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2 Court Rulings 2.1 Transfer of undertaking Federal Labour Court, No. 6 AZR 235/19, 14 May 2020 The dismissals of the cabin staff of the insolvent airline Air were not permissible due to incorrect mass dismissal notices. However, the employment relationships of these employees were not transferred to Luftfahrtgesellschaft Walter mbh (hereinafter: LGW). With regard to the dismissals of the cockpit personnel, the Court had earlier ruled that the notification of mass dismissal for the pilots assigned to the Düsseldorf station should have been made to the competent employment agency in Düsseldorf with the information relating thereto. This decision has now been confirmed with regard to the cabin crew. On the other hand, the court found that the requirements for a (partial) transfer of an undertaking within the meaning of § 613a (1) sentence 1 of the were not met (this question had been left open in the ruling of the Federal Labour Court of 27 February 2020 – 8 AZR 215/19; see February 2020 Flash Report). It is true that the LGW was correct that the so-called ‘wet lease’, which Air Berlin had carried out for another airline, had in part been continued by the LGW until the end of December 2017. However, in the absence of sufficient staff allocation, the wet lease at Air Berlin was at no time a part of the business that could have been transferred to a purchaser. A press release relating to this judgment is available here.

2.2 Working time Federal Administrative Court, No. 8 C 5.19, 06 May 2020 According to the Court, the Evangelical Lutheran Regional Church of Saxony is to be involved in the administrative procedures to authorise Sunday work in call centres. In the Court’s view, the provisions of the Working Hours Act protect third parties, including religious communities. The Church may invoke freedom of religion. Pursuant to Paragraph 13(2), sentence 2 of the Act on Administrative Procedures (Verwaltungsverfahrensgesetz), the applicant was to be involved in proceedings for the authorisation of Sunday work in call centres. The provisions of the Working Hours Act, which in individual cases permit exceptions to the fundamental prohibition of employment on Sundays and public holidays, protect third parties with regard to religious communities. These could invoke the fundamental right of freedom of religion under Article 4 of the Law, which is further substantiated by the guarantee of Sundays and holidays under Article 140 of the Basic Law in conjunction with Article 139 of the Weimar Reich Constitution. Pursuant to the latter, Sundays and officially recognised public holidays remain protected by law as days of rest from work and mental rest. The constitutional mandate to protect these days was not only addressed to the legislature, but was also to be observed by the authorities when deciding on granting exceptions. Section 13(2) of the Act reads as follows: “The Authority may, ex officio or upon application, involve as parties those whose legal interests may be affected by the outcome of the proceedings. If the outcome of the proceedings has a legally formative effect on a third party, that third party must, upon application, be called upon to participate in the proceedings as an interested party; to the extent that the authority is aware of the third party, it must inform him of the initiation of the proceedings.” A press release dealing with this judgment is available here.

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3 Implications of CJEU Rulings and ECHR 3.1 Transfer of undertakings CJEU case C-298/18, Grafe und Pohle, 27 February 2020 With its decision, the CJEU deviates to a certain extent from its judgement of 25 January 2001 – C-172/99, even though it attempts to even out differences between the two cases in the present decision. From the German point of view, the question arises in particular whether the CJEU is softening the distinction between transfers with a high level of operational resources and transfers with only a few operational resources. In any case, there are certain differences to the existing case law of the Federal Labour Court. In the opinion of the Federal Labour Court, a transfer of an undertaking in the case of a rescue service is ruled out, for instance, if the rescue vehicles are not taken over.

CJEU case C-344/18, ISS Facility Services, 26 March 2020 In the literature in Germany, the CJEU decision has been criticised by some as being “legally dubious and impractical”. The argument is as follows: the assignment of employees to transferable units in the case of a transfer of parts of a business is controversial. However, the solution found by the CJEU, namely to divide the employment relationship of a superior employee, who typically performs administrative tasks, into several part-time employment relationships, is to be rejected as a rule. Rather, the present case would suggest that the purchasers had actually taken over only the employees involved in the cleaning activities in the individual lots, but not the vendor’s ‘administrative apparatus’, which must be separated from the transferred parts of the business. It was therefore probable that the employee's employment relationship had not been transferred at all (see Arnold, Fachdienst Arbeitsrecht 2020, 429300). It has also been pointed out in the literature that in practice, it will become even more important than before to find consensual, and in any case unambiguous, solutions between the parties concerned (see Boigs, jurisPR-ArbR 21/2020 note 5). Finally, there is doubt in the literature as to whether the existing case law of the Federal Labour Court is in line with the position of the CJEU. It is argued that the splitting of the employment relationship by way of a transfer of an undertaking has so far been alien to the national understanding (see Steffan, ArbRB 2020, p. 135). However, it seems that the German courts have so far only dealt with situations in which employment relationships are integrated into various company substructures and only a part of the substructure that characterises the actual workplace is transferred. According to the Federal Labour Court’s case law, in the case of transfers of parts of a business, the employees are allocated either by mutual agreement between the parties to the employment agreement or by the employer on the basis of his or her right of management. If the employee works for several business units, the focus of his/her work is decisive, i.e. in which part of the business he/she is predominantly active (see Federal Labour Court of 17 October 2013 – 8 AZR 763/12; 21 February 2013 – 8 AZR 878/11; see also Boigs, jurisPR-ArbR 21/2020 note 5).

4 Other Relevant Information Nothing to report.

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Greece

Summary New measures have been taken in Greece to deal with the coronavirus crisis. ______1 National Legislation 1.1 Measures to respond to COVID-19 crisis Article 31 of Law 4690 of 30 May 2020 introduced a new mechanism under the name ‘Co-operation’, aiming to uphold full-time employment contracts. The duration of this mechanism will apply from 15 June 2020 to 15 October 2020, and exceptionally, for particular undertakings, until 31 December 2020. The mechanism is applicable to full- time employees for all enterprises that face a given reduction in their level of income (i.e. of at least 20 per cent in comparison to the reference month and depending on the month of participation in the mechanism). In particular, if an enterprise is eligible to participate in the above-described mechanism, the employer has the option to reduce up to 50 per cent of the weekly working hours of all or some of the employees. Employees included in the mechanism are entitled to receive additional support from the Greek State in addition to their wage for reduced working hours, amounting to 60 per cent of their net salary corresponding to the time during which they do not provide any work (i.e. 60 per cent of their lost income). It is also provided if the employee’s net earnings, after the above adjustment, are less than the minimum statutory salary or wage, the difference is covered by the Greek State. The social security contributions of employees participating in the system of cooperation are covered in full by the employer, both for working and non-working periods, unless explicitly regulated otherwise. To safeguard the concerned employees, it is further provided that employers are not allowed to terminate the employment contracts of employees who participate in said mechanism. Otherwise, such termination shall be considered null and void. Employers shall also maintain the same salaries of the employees for as long as the employees participate in the mechanism.

1.2 Other legislative developments Nothing to report.

2 Court Rulings Nothing to report.

3 Implications of CJEU Rulings and ECHR 3.1 Transfer of undertakings Case C-298/18, Grafe und Pohle, 27 February 2020 The judgment in question an important issue. In fact, for a similar issue, two contradictory judgments have been issued by the Greek Supreme Court. One ruled that renting tourist buses to another travel agency with a

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statement to staff to continue to be employed by the successor is a transfer of undertaking and employee drivers are required to work there (Areios Pagos Supreme Court No. 1479/2018). The other one (Areios Pagos Supreme Court No. 997/2018) ruled that this activity is not a transfer and drivers may refuse to work for the successor and request severance pay. The take-over of the buses is a crucial criterion in establishing whether a transfer of undertaking has taken place. If no transfer of operating resources has taken place, in so far as it results from legal, environmental or technical constraints, the taking over of the majority of the employees and the pursuit, without interruption, of the same activity, make it possible to establish that the identity of the economic entity concerned has been retained. The Court has correctly considered all the facts characterising the transaction concerned and in particular, the type of undertaking concerned. This judgment clarifies an important issue of labour law.

CJEU case C-344/18, ISS Facility Services, 26 March 2020 This judgment seems to be in line with the purpose of the Directive, which is to safeguard workers' rights even in this rather rare case of division of the employment contract.

4 Other Relevant Information Nothing to report.

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Hungary

Summary (I) Following the cessation of the state of emergency, the Labour Code must be applied with four alterations up to 01 July 2020. (II) The Constitutional Court stated that the Constitution contains the right to daily and weekly rest days separately, thus, these periods cannot overlap. ______1 National Legislation 1.1 Measures to respond to COVID-19 crisis 1.1.1 Transitional measures following the cessation of the state of emergency The government submitted Bill No. T/10747 to Parliament on the termination of the state of emergency on 26 May 2020. Parliament is predicted to vote on this Act on 16 June 2020. This new law will not in itself terminate the state of emergency, but only calls upon the government to end it by issuing a Decree, Article 1 of Bill No. T/10747. However, the Authorisation Act and the government decrees issued during the state of emergency will lapse with the end of it. According to the statement of the Minister of Justice (published in a newspaper article on 26 May 2020), the state of emergency shall end on 20 June 2020. At the same time, the government also submitted Bill No. T/10748 to Parliament on the transitional rules connected to the cessation of the state of emergency. Parliament is expected to vote on this Act on 16 June 2020. Amongst the very extensive transitional provisions, Article 56 contains the following rules related to labour law: “24. Transitional provisions concerning the altered application of Act 1 of 2012 on the Labour Code 56. § (1) Act 1 of 2012 on the Labour Code (henceforward: Mt) is applied with the altered rules in this article. (2) Mt will be applied until 01 July 2020 with the following alterations : a) the employer may amend the formerly declared schedule of working time differently than established in Article 97(5) of Mt, b) the employer may unilaterally order home office and telework for the employee, c) the employer may use necessary and justifiable measures to monitor the health condition of the employee, d) the employer and the employee may derogate form the provisions of Mt in a separate agreement. (3) Employment in a reference period, which is ordered unilaterally by the employer or by agreement of the parties during the state of emergency, will not be affected by the cessation of the state of emergency. (4) The minister responsible for employment policy can authorise that in case of a job creation investment, the employer may apply a reference period or a payroll period—taking into account the relevant provisions of Mt—on the basis of maximum 24 months, if the investment is in the interest of the national economy.

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(5) The minister responsible for employment policy shall make the decision described in Subsection (4) within 90 days.” Article 56 clearly indicates that the transitional measures will remain in force, i.e. the provisions of Article 6 of Government Decree No. 47/2020, with the exception of the ban on regulating these issues in a collective agreement. However, the new deadline of 01 July 2020 raises some concern. According to Subsection (2)d) of Article 56, (new) derogating agreements may apply until 01 July 2020. According to Subsection (3), only derogating agreements on reference periods will not be affected by the cessation of the state of emergency. It can thus be concluded (only) from this provision that all other agreements will be affected (terminated) by the end of the state of emergency. If the state of emergency ends before 01 July (i.e. 20 June as predicted by the Minister of Justice), then new derogating agreements can be made until 01 July, but the derogating agreements concluded before the end of the state of emergency (20 June) will be affected by the end of it. Hence, the former derogating agreements will no longer be in force (except those on reference periods), but new derogating agreements may be concluded. The parties, for instance, may uphold their former derogating agreement (concluded before 20 June), which ceased with the end of the state of emergency. There is no rule on the future of the new agreements concluded before 01 July 2020. Their temporal scope may not be affected by the end of the state of emergency, if they are concluded after that date. Based on general principles of law, these agreements must comply with the ‘normal’ rules after 01 July 2020, however, there is no explicit provision on that in the bill. In addition, it is quite obscure why it is necessary to keep the above mentioned measures in force after the state of emergency, supposedly only for a couple of days. Article 56 also contains a clearly non-transitional measure on the maximum 24 months reference period. So far, the employer and the collective agreement could introduce a reference period. From now on, the minister responsible for employment policy can grant a maximum 24-month reference period upon the employer’s request. This decision must be based on the need for ‘job creation’ and the ‘interest of the national economy’. This new provision is in line with some measures described above on weakening the role of collective bargaining. Moreover, this possibility is clearly in the hand of the minister, who makes such a decision on the basis of these extremely flexible concepts. At the same time, the real value of this possibility is also questionable, since the 48 hour weekly maximum must be calculated on a four months or six months basis. Overall, Article 56(4)-(5) is an amendment of the Labour Code provisions on the reference period, which should have been inserted in the Labour Code. Formally, it is quite problematic that only one of the provisions on reference periods is covered in a separate act on ‘transitional rules’.

1.2 Other legislative developments Nothing to report.

2 Court Rulings 2.1 Overlapping of daily and weekly rest periods Constitutional Court, No. IV/702/2019, 26 May 2020 The Constitutional Court stated the unconstitutionality of Decision No. Mfv.II.10.279/2018/13 of the Supreme Court (Curia) and repealed it. In the present case, the employer merged the daily rest period (11 hours) and the two weekly rest days, thus, these periods overlapped. The Curia stated that the daily and

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weekly rest days are separate labour law notions, however, this does not mean that they cannot overlap or fall within the same period. In case of an overlap, the functions of both rest periods are fulfilled. On the contrary, the Constitutional Court stated that the Constitution regards these two rights separately. Therefore, the two periods may not overlap and can be provided in addition to each other, namely 11 hours of daily rest and two weekly rest days.

3 Implications of CJEU Rulings and ECHR 3.1 Transfer of undertaking Case C-298/18, Grafe und Pohle, 27 February 2020 Article 1(1) of Directive 2001/23/EC must be interpreted as meaning that in the context of the takeover by an economic entity of an activity, the pursuit of which requires substantial operating resources under a procedure for the award of a public contract, the fact that that entity does not take over those resources, which are the property of the economic entity previously engaged in that activity, on account of legal, environmental and technical constraints imposed by the contracting authority, cannot necessarily preclude the classification of that takeover of activity as a transfer of an undertaking, since other factual circumstances, such as the taking over of the majority of the employees and the pursuit, without interruption, of that activity, make it possible to establish that the identity of the economic entity concerned has been retained, this being a matter for the referring court to assess. Article 36(1) of the Labour Code contains the following definition of transfer of undertakings: “Rights and obligations arising from employment relationships, existing at the time of transfer of an economic entity (organised grouping of material or other resources) by way of a legal transaction are transferred to the transferee employer.” It is for the Hungarian labour courts, and particularly the Curia (Supreme Court) to interpret this definition in accordance with the above analysed CJEU decision.

CJEU case C-344/18, ISS Facility Services, 26 March 2020 Where a transfer of undertaking involves a number of transferees, Article 3(1) of Directive 2001/23 must be interpreted as meaning that the rights and obligations arising from a contract of employment are transferred to each of the transferees, in proportion to the tasks performed by the worker concerned, provided that the division of the contract of employment as a result of the transfer is possible and neither causes a deterioration of working conditions nor adversely affects the safeguarding of the rights of workers guaranteed by that directive, which it is for the referring court to determine. If such a division were impossible to carry out or would adversely affect the rights of that worker, the transferee(s) would be regarded as being responsible for any consequent termination of the employment relationship, under Article 4 of that directive, even if that termination were to be initiated by the worker. Article 36(1) of the Labour Code contains the following definition of transfer of undertakings: “Rights and obligations arising from employment relationships, existing at the time of transfer of an economic entity (organised grouping of material or other resources) by way of a legal transaction are transferred to the transferee employer.”

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Article 40 contains the right of the employee to terminate the employment relationship, in accordance with Article 4 of the Directive: “40(1) The provisions contained in Section 70 and Section 77 shall apply mutatis mutandis if the worker terminates his employment relationship by giving notice, because the transfer of employment upon the transfer of an enterprise involves a substantial change in working conditions to the detriment of the employee, and in consequence, maintaining the employment relationship would entail an unreasonable disadvantage or would be impossible.” It is for the Hungarian labour courts, and particularly the Curia (Supreme Court) to interpret the definition of transfer and termination of employment by the employee under Article 40 in accordance with the above analysed CJEU decision.

4 Other Relevant Information Nothing to report.

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Iceland

Summary Three new pieces of labour law legislation in response to the COVID-19 pandemic have been published.

______1 National Legislation 1.1 Measures to respond to COVID-19 crisis 1.1.1 State wage support On 29 May, the Act on State Support for Partial Payment of Salary During the Notice Period was passed in Alþingi. The new scheme implemented by the law allows employers who fulfil certain conditions to apply for up to 85 per cent of an employee’s salary during the notice period to be paid by the state for a maximum of ISK 633 000 a month in addition to pension contributions of up to ISK 85 455 a month for up to three months, as stated in Article 6 of the Act. Additionally, the employer may apply for up to ISK 1 014 000 for holiday pay for each employee. The amounts are calculated for full-time work and part-time employees are entitled to a proportion of those amounts in relation to their work percentage. This support, however, is tied to certain conditions. The political discussion focussed much on ensuring that the support target those companies in need to reduce the scale of bankruptcies. There was also discussion in the political and public sphere on excluding companies that were registered in tax-havens from receiving such support. To apply for this support, the employer must fulfil certain conditions laid out in Article 4 of the Act. The employer must inter alia have suffered a 75 per cent reduction in income as of 1 April in comparison to one of four other periods. The employer must have complied with the rules on CFC-companies, tax laws, the Act on Annual Accounts, No. 3/2006, and informed of the actual owners, as stipulated in the Act on Registration of Real Owners, No. 82/2019. Furthermore, the employer must declare the support as taxable income as stated in Article 9. Article 12 of the Act stipulates that the employees shall also be entitled to be prioritised for the job for 12 months from the date of termination and with the same rights and obligations for 6 months from the date of termination.

1.1.2 Partial unemployment benefits On 29 May, the partial unemployment scheme that had been in force since the middle of March was extended with certain amendments in the Amendment of Act on Unemployment Insurance and Act on Wage Guarantee Fund (extension of partial unemployment benefits). As stipulated in Article 2(1) of the Act, the extension will be unchanged for employees until 30 June, i.e. employees must continue working at least 25 per cent. In addition, his/her work percentage must be reduced by at least 20 per cent of full-time work from his/her former work percentage. From 01 July to 31 August, the conditions will change, and an employee will have to work at least 50 per cent. The condition regarding the reduction of work percentage from the former amount remains unchanged. However, additional conditions are placed upon the employer in the amended Act. These conditions are specified in Article 2(5). Firstly, the employer must be subject to unlimited

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taxability in Iceland. Secondly, the employer’s monthly income must have been reduced by 25 per cent from 15 March in comparison with one of four periods stipulated in the provision. Thirdly, the employer may not from 01 June decide to pay dividends, decrease share capital or in any way pay shareholders in relation to their status as shareholders. There are additional conditions such as not paying subordinated loans before the date of maturity, not paying shareholders or senior executives a higher salary than ISK 3.000.000 per month for a certain period as well as having followed rules related to CFC companies, tax laws, the Act on Annual Accounts, No. 3/2006, and informed of actual owners, as stipulated in the Act on Registration of Real Owners, No. 82/2019. These changes have been made in response to the public discussion in Iceland after it was revealed that relatively well-off companies were putting employees on partial unemployment benefits, which was not in line with the target of the original legislation which was nevertheless purposely left quite open to avoid more unemployment. The Directorate of Labour eventually published the list of all those legal persons who made agreements with employees on partial unemployment benefits, which included both companies as well as .

1.1.3 Wage replacement during quarantine Finally, on 11 May, Article 7 of the Amendment of Certain Acts to Respond to the Economic Consequences of the Epidemic Corona Virus (Additional Operations), amended Act No. 24/2020, on Temporary Payments for the Salary of Individuals Ordered to Quarantine by the Health Authorities Without Infection, which extended the scheme which was introduced in mid-March until 30 September. However, a new provision was added to Article 1, which states that no payments shall be made under the Act to those that have travelled abroad, if he/she should have been aware of the need to quarantine upon arrival, based on the health authorities’ decision that those returning from that specific country should be quarantined upon arrival in Iceland.

2 Court Rulings 2.1 Dismissal protection In May, two judgments were passed in the Court of Appeal on the termination of employment. The first one Court of Appeal judgment of 22 May 2020 in case No. 701/2019 concerned the termination of employment of an employee who had been on sick leave and set-off of debts, which meant he had not received his salary during one month of sick leave. The second, Court of Appeal judgment of 29 May 2020 in case No. 544/2019, concerned the payment of regular over-time payments of a seaman whose employment had been terminated without the employer requesting him to work during the notice period. Neither case derogated from established case law.

3 Implications of CJEU Rulings and ECHR Nothing to report.

4 Other Relevant Information Nothing to report.

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Ireland

Summary (I) The three Income Support Schemes introduced in March, continue to apply and have been partly extended, and further amendments are being discussed. (II) The government, social partners and the Health and Safety Authority are expected to develop a national safety protocol for workplaces. ______1 National Legislation 1.1 Measures to respond to COVID-19 crisis The restrictions on social and economic life originally imposed in March 2020 and detailed in previous Flash Reports, began to be lifted on 18 May 2020. On 05 June 2020, the government announced a Revised Roadmap under which all retail stores could open from 08 June 2020, with shopping centres opening on 15 June 2020 and cafés and restaurants opening on 29 June 2020, provided social distancing (currently 2m) can be maintained. The lockdown will largely end on 20 July 2020.

The Pandemic Unemployment Payment (hereinafter: PUP) and the Temporary Wage Subsidy Scheme (hereinafter: TWSS) are to continue until 10 August, but from 29 June, the EUR 350 PUP will drop to EUR 203 for those who earned on average EUR 200 per week or less. This followed the compiling of a report by the Department of Business, Enterprise and Innovation which estimated that 38 per cent of those in receipt of the PUP were paid less than EUR 300 per week before the payment was introduced.

As of 02 June 2020, 47 800 workers, 56 per cent of whom are female, have been medically certified for receipt of the COVID-19 enhanced illness benefit of EUR 350 per week. Twenty-two per cent of these are employed in the human health and social work sector. Only 7 per cent of those in receipt have been medically certified as having the virus. As of the same date, 543 200 workers, 55 per cent of whom are male and 44 per cent of whom are under 35, are in receipt of the PUP. 22.5 per cent of workers in receipt of the payment were employed in the accommodation and food services sector, 15 per cent in the wholesale and retail trade and 11 per cent in construction.

An update on payments awarded in response to the COVID-19 pandemic is available here.

The TWSS is available to employers who keep employees on the payroll, thus avoiding lay- offs and/or redundancies (for details, see previous Flash Reports). The TWSS is operated by the Revenue Commissioners through the payroll system and is now scheduled to last until 10 August 2020. As of 04 June 2020, 57 800 employers had registered for the scheme, with 514 700 employees having been subsidised since the scheme began. Currently, some 380 000 employees are being subsidised. As of that date, the total subsidy payment was EUR 1.37 bn:

Preliminary statistics regarding the TWSS are available here.

On 29 May 2020, the Minister of Finance addressed the concerns of the National Women’s Council, the Irish Congress of Trade Unions and the Irish Human Rights and Equality Commission by announcing changes to the scheme to allow people returning from maternity and other family leave to access the scheme, notwithstanding their not being on the employer’s payroll on 29 February 2020. More information on this issue is available here.

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The Health and Safety Authority has issued guidance in relation to home-working. The guidance is in the form of FAQs on the practicalities of home-working, including what equipment should be provided and what supports/means of communications should be put in place to protect workers.

The Data Protection Commissioner has also published guidance for employees working from home to assist in the protection of personal data. Detailed advice is provided concerning the issue in the context of devices, emails, cloud and network, and hard copy paper records.

Queries about employment rights to the various free legal advice centres have almost doubled since March. The figures indicate a surge in the number of workers who feel that their employer has treated them unlawfully during the lockdown. Among the examples given were women who were told to take their maternity leave early, workers with underlying health conditions being told they had to return to work despite their concerns, and workers being told to take their annual leave during the lockdown.

A newspaper article of ‘The Irish Times’ from 02 June 2020 on this topic is available here.

1.2 Other legislative developments Nothing to report.

2 Court Rulings Nothing to report.

3 Implications of CJEU Rulings and ECHR 3.1 Transfer of undertakings Council Directive 2001/23/EC was transposed in Ireland by the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003 (S.I. No. 131 of 2003).Regulation 3(1) and (2) faithfully transposes Article 1(1) of the Directive. Regulation 2(1) faithfully transposes Article 2(1) of the Directive. Regulation 4 faithfully transposes Article 3(1) of the Directive.

CJEU case C-298/18, Grafe und Pohle, 27 February 2020

The factual situation presented by these proceedings has not arisen in Ireland and it would not appear that the CJEU decision in case C-172/99, Liikenne has been cited or considered in any of the transfer of undertakings cases that have been litigated here. The fact that no buses transferred would obviously be a significant factor but would not in and of itself preclude the classification of the transaction as a transfer of an undertaking, particularly if the service provided by the transferor was essentially similar utilising the same routes for the same passengers and the transferor employed the majority of the transferee’s staff.

CJEU case C-344/18, ISS Facility Services, 26 March 2020

As with Article 3(1) of the Directive, Regulation 4 of the 2003 Regulations does not envisage a situation where a transfer of an undertaking involves more than one transferee. The answer to the questions referred, provided by the CJEU, is not without its own difficulties in that Regulation 4 must now be interpreted as meaning that an employee’s rights and obligations are transferred to each of the transferees in proportion

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to the tasks performed by the employee “provided that the division of the contract is possible and neither causes a worsening of working conditions nor adversely affects the safeguarding of the rights guaranteed by the Directive”.

What if the division of the contract of employment can be carried out, but by only one of the transferees – would there be an adverse effect on the employee’s working conditions? What if only one of the transferees agrees to continue to employ the employee? It is noted that Cleaning Masters (who were awarded Lot 2 estimated at 15per cent of the claimant’s workload) do not appear to have been party to the proceedings before the Ghent Labour Court.

4 Other Relevant Information Nothing to report.

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Italy

Summary The Italian government has adopted several measures aimed to contain the spread of the COVID-19 virus. Some economic activities (i.e. industries and retail) recommenced again on 04 May by Decree of the President of the Council of Ministers 26 April 2020. The decrees approved in May provide for other re-openings on 18 May, 25 May and 15 June, respecting the safety measures to avoid the spread of the virus. At the same time, the Italian government introduced some measures to mitigate the lockdown’s negative consequences and to promote economic recovery ______1 National Legislation 1.1 Measures to respond to COVID-19 crisis 1.1.1 Law Decree 16 May 2020 No. 33 The Law Decree 16 May 2020 No. 33 establishes that all economic activities must comply with the security protocols adopted at national and regional level. Failure to comply with the content of these protocols shall result in the suspension of the activity.

1.1.2 Decree of the President of the Council of Ministers 17 May 2020 The Decree of the President of the Council of Ministers 17 May 2020 regulates the reopening of some economic activities on 18 May, 25 May and 15 June. According to Article 2, all economic activities must always comply with the protocol concluded on 24 April between the government and social partners, which is annexed to the Decree. On 18 May:  all retail stores;  hairdressers, barber shops and beauty centres;  bathhouses;  museums and archaeological areas may reopen. Restaurants and bars may offer table service rather than delivery and take away only. Athletes involved in either individual or team sports may start training again. On 25 May, gyms, swimming pools and sports centres may reopen. On 15 June, theatres, cinemas and concert halls may reopen. Seats must be assigned and only a maximum of 1 000 spectators can be seated outdoors and only 200 indoors. Discos, both outdoor and indoor, cannot reopen and trade fairs and conferences cannot take place.

1.1.3 Law Decree 19 May 2020 No. 34 The Law Decree 19 May 2020 No. 34 introduces urgent measures to support work, the economy and social policy initiatives related to the epidemiological emergency caused by COVID-19. Articles 68-69-70: employers who have suspended their activity due to COVID-19 can apply for Cassa integrazione for 9 months, until 31 August. If they have already used 9

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months of Cassa Integrazione, they can ask for another 5-week extension. An additional 4 weeks can be requested in September and October. Article 72: employees who have children up to the age of 12 years, can take a special leave of 30 days (it was for 15 days according to Law Decree 17 March No 18). Such leave is paid at 50 per cent of the employee’s remuneration and can be used alternately by each parent. This allowance is also paid to workers insured under the ‘Gestione separate’ INPS. The same leave is available for parents of children with disabilities, without an age limit, if they are attending school. Parents with children aged 12 to 16 are entitled to unpaid leave from work for the rest of the school year. The amount of child care bonus has been increased from EUR 600 to EUR 1 200 (from EUR 1 000 to EUR 2 000 for employees of the public and private health sector, such as doctors, nurses, biomedical laboratory technicians, medical radiology technicians and for security, defence and public rescue sector employers). It can be requested instead of leave. Article 73: the number of days of paid leave provided ban additional 12 days, available in May and June 2020. Article 80: the prohibition of dismissal provided for in Decree 17 March 2020, No. 18 has been extended from 60 days to 5 weeks (until 17 August). Article 82: in May, emergency income (REM) is granted to families in financial need due to the COVID-19 crisis. This income is EUR 400 per month, and is paid by Inps (National Institute for Social Security) to families that comply with the requirements of the decree, e.g. residence in Italy and an income threshold. Article 84: the Decree extends the duration of some allowances provided by Law Decree 02 March 2020 No. 9 and Law Decree 17 March No. 18 and confirmed by Law 24 April No. 27. These are allowances for contractors and self-employed workers, agricultural and seasonal workers in the sector. An allowance of EUR 600 per month for the months of April and May 2020 is provided for artists and athletes with an annual income not exceeding EUR 50 000. Article 85: an allowance of EUR 500 per month for the months of April and May 2020 is provided for domestic workers who had one or more employment contracts on 23 February 2020 for a total duration of more than 10 hours per week, only if they are not living with the employer. Article 93: fixed-term contracts, which were concluded before 23 February 2020, can be renewed or extended until 30 August 2020, even in the absence of the requirements provided for by Decree 81/2015 (temporary and objective needs, unrelated to the company’s ordinary activity; replacement of other workers; temporary, significant and non-programmable increases in ordinary activities). Article 94: beneficiaries of unemployment benefits or basic income can have fixed-term contracts with agricultural employers for 30 days, renewable for another 30 days, without losing their benefits. Article 103: employers can ask to sign employment contracts with foreign citizens residing in Italy and can declare irregular employment relationships with Italian or foreign citizens. The application must be submitted to:  INPS for Italian and European workers;  Questura for foreign citizens with expired residence permits that have not been renewed;  office for other foreign workers. The application can only be presented in the following sectors: agriculture, animal breeding, fishing and , caregiving, domestic work in a family. Together with

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the application, a contribution of EUR 500 must be paid for each worker. The application cannot be presented by employers who have been convicted of aiding or exploiting illegal immigration. Workers expelled from Italy or convicted for certain crimes (against personal freedom, drugs, or immigration, exploitation of prostitution) cannot be admitted to the procedure.

1.1.4 Law 22 May 2020 No. 35 The Law 22 May 2020 No. 35 transposes Law Decree 25 March 2020 No. 19 into law, with some modifications that do not affect the overall structure of the provisions and, in any case, do not concern employment relationships.

1.2 Other legislative developments Nothing to report.

2 Court Rulings Nothing to report.

3 Implications of CJEU Rulings and ECHR 3.1 Transfer of undertakings CJEU case C-298/18, Grafe und Pohle, 27 February 2020 and CJEU case C-344/18, ISS Facility Services, 26 March 2020 Both judgments dealt with the succession of contracts and the applicability of the rules on transfers of undertakings. In the past, Italian case law has ruled that a transfer of undertaking had only taken place if a contract had been established between the transferor and the transferee, excluding situations of change of contracts, while the Court of Justice of the European Union, in application of Directive 77/187/EEC, did not consider the existence of any contractual link between the transferor and the transferee necessary. Furthermore, Article 29, para. 3, Legislative Decree 276/2003, in its original version, provided that the hiring of workers already employed after the takeover of a new contractor is not considered a transfer of undertaking, thus excluding the application of Article 2112 Civil Code. To avoid an infringement procedure, Act No. 122/2016 modified Article 29, which now states that "the hiring of workers already employed, after the takeover of a new contractor with its own organisational and operational structure, if there are elements of discontinuity that provide for a specific corporate identity, does not entail a transfer of an undertaking". Italian law does not specify what the elements of discontinuity are; hence, a careful case-by-case examination is necessary. Courts consider that the regulation on transfers of undertakings applies in case of labour intensive activities that continue to take place in the same premises, with the same equipment previously used and with the acquisition of a significant part of the staff both in terms of skills and quantity. A transfer of an undertaking is at stake even when the transferred economic entity consists of staff only, if it is a group of permanently coordinated and organised

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employees with particular know-how (Cass. 06 December 2016, No. 24972). Furthermore, there is no element of discontinuity if the new employer has made organisational changes that do not affect the functional autonomy of the workers. In conclusion, the decisions CJEU 27 February 2020, C‑298/18 and CJEU 26 March 2020, C‑344/18 are compatible with Italian legislation and jurisprudence.

4 Other Relevant Information Nothing to report.

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Latvia

Summary (I) Parliament has adopted several COVID-19 related measures allowing for derogation from certain labour rights. (II) Parliament has started working on the adoption of amendments to the Labour Law on transparent and predictable employment conditions, and telework. (III) The unemployment rate has continued to increase in May 2020. ______1 National Legislation 1.1 Measures to respond to COVID-19 crisis On 07 May 2020, Parliament adopted amendments to the Law on the Threat to the State and Prevention and Overcoming of such Threat in Relation to the Spread of COVID-19 (Grozījumi likumā "Par valsts apdraudējuma un tā seku novēršanas un pārvarēšanas pasākumiem sakarā ar Covid-19 izplatību", OG No. 88B, 08 May 2020). The amendments, which entered into force on 09 May 2020, allows employers to derogate from several employment rights provided by the Labour Law (Darba likums, OG No. 105, 06 July 2001). The derogations that are now possible are the following:  for employers who qualify for state support (‘downtime allowance’) can be provided such allowance in the amount of 70 per cent (derogation from Article 74 of the Labour Law requiring payment of full wages in case of downtime);  remuneration may not be lower than the statutory minimum salary;  persons who have minor dependents are entitled extra pay for each dependent in the amount guaranteed by the State Maintenance Fund;  provide paid annual leave by not observing Article 150(2) of the Labour Law which requires taking the wishes of an employee into account in defining the period when paid annual leave is granted;  if an employee does not agree with the amendments to an employment contract entailing a decrease in pay, an employer is not bound by a time period of one month as provided in Article 100(1) of the Labour Law, i.e. an employer may terminate an employment contract immediately, however, the employer is bound to pay severance as provided in Article 112 of the Labour Law. The amendments also allow for modification of collective agreements but no longer than 31 December 2020. Specifically, collective agreements for a specific period of time may define part-time employment for full-time employees under the condition that minimum pay may not be lower than statutory minimum pay and that employees with dependants are entitled to extra pay for each dependent in the amount guaranteed by the State Maintenance Fund. If an employee does not agree with the amendments to an employment contract under a modified collective agreement entailing a decrease in pay, an employer is not bound by the time period of one month as provided in Article 100(1) of the Labour Law, i.e. an employer may terminate an employment contract immediately, however, the employer is bound to pay severance as provided in Article 112 of the Labour Law.

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1.2 Other legislative developments 1.2.1 Transparent and predictable employment conditions On 29 May 2020, draft amendments to the Labour Law were submitted to Parliament by the Cabinet of Ministers (Legislative proposals No.717/p13). The draft amendments envisage implementation measures for Directive 2018/957/EU on the posting of workers and Directive 2019/1152/EU on transparent and predictable employment conditions.

1.2.2 Telework Apart from the EU law, draft amendments envisage certain regulations for remote working, which presently is not regulated at all. Draft amendments regulate the division of expenses related to remote working between the employer and the employee.

2 Court Rulings Nothing to report.

3 Implications of CJEU Rulings and ECHR Nothing to report.

4 Other Relevant Information 4.1 Unemployment The level of unemployment in Latvia on 31 May 2020 has reached 8.4 per cent (72 917 persons) according to records of the State Employment Agency. Latvia is thus among the EU Member States with the highest rate of unemployment. Compared to the last quarter of 2019, the level of unemployment was 6 per cent (close to the highest level of economic activity since 2007 before the economic crisis of 2008: Special Economic Area of Latgale, Unemployment rate rapidly approaches rates of 2007, Bezdarba rādītāji strauji pietuvojas 2007. gada līmenim, 25 February 2020) and in the middle of April 2020, the unemployment rate was already 7.5 per cent (68 264 persons). As regards the most affected sectors, the collective redundancies announced to the State Employment Agency are in the passenger transport sector (35 per cent of the announced collective redundancies) and arts and entertainment (24 per cent).

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Liechtenstein

Summary The measures reported in the March Flash Report have been supplemented and in some cases modified in accordance with the developments and implementation of protection plans; particularly vulnerable persons should not be engaged in child care activities; hygiene and social distancing measures have been enhanced; the obligations of the employer concerning health protection with regard to particularly vulnerable workers are specified; unemployment benefits and compensation for short-time work are being provided. ______1 National Legislation 1.1 Measures to fight COVID-19 The March Flash Report reported a number of measures taken by the Government of Liechtenstein to fight the coronavirus (COVID-19). These include measures that directly affect labour law. During the reporting period, these measures were supplemented and in some cases modified. Some are mentioned here:

1.1.1 Development and implementation of protection plans For approved facilities and events, the development and implementation of a protection plan must ensure that the transmission risk is minimised for customers, visitors, participants and workers. Wherever possible, industry or professional associations shall develop industry-related basic protection plans. To this end, they shall consult the social partners. The competent enforcement bodies shall close institutions or ban events if there is no adequate protection plan or if the latter is not being observed. Art. 5a(1), (3), and (5) of the Ordinance on measures to fight the coronavirus (COVID- 19) (Verordnung über Massnahmen zur Bekämpfung des Coronavirus, Covid-19, LR 818.101.24).

1.1.2 Education and child care facilities Particularly vulnerable persons should not be engaged in child care activities. Art. 5b(4) of the Ordinance on measures to fight the coronavirus (COVID-19) (Verordnung über Massnahmen zur Bekämpfung des Coronavirus, Covid-19, LR 818.101.24).

1.1.3 Hygiene and social distancing Particularly vulnerable persons shall stay at home and avoid crowds. If they leave the house, special arrangements apply and the recommendations of the government and of Public Health on hygiene and social distancing must be complied with. Art. 7b(1) of the Ordinance on measures to fight the coronavirus (COVID-19) (Verordnung über Massnahmen zur Bekämpfung des Coronavirus, Covid-19, LR 818.101.24).

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1.1.4 Obligations of the employer concerning health protection with regard to particularly vulnerable workers The employer shall allow particularly vulnerable workers to perform work from home. To this end, the employer shall take the appropriate organisational and technical measures to make this possible. If it is not possible for a vulnerable employee to perform his/her regular work obligations from home, the employer shall, in derogation from the employment contract, assign equivalent substitute work to the respective worker, which can be performed from home, and for which the same amount of remuneration is paid. To this end, the employer shall take the appropriate organisational and technical measures. If, for operational reasons, the presence of particularly vulnerable workers on site is fully or partly indispensable, they may be employed on site in their regular occupation if the following conditions are met:  the workplace is designed in such a way as to preclude any close contact with other persons, in particular by providing a single room or a clearly delimited working area, taking into account the minimum distance of two metres;  in cases where close contact cannot be avoided at all times, appropriate protective measures shall be taken according to the STOP principle (substitution, technical measures, organisational measures, personal protective equipment). If it is not possible to employ the respective workers in this manner, the employer shall, in derogation from the employment contract, assign equivalent substitute work on site to such workers, whereby the requirements are met, and for which the same amount of remuneration is paid. Before introducing these measures, the employer shall consult the worker(s) concerned. The worker(s) concerned may reject the work assigned to them if the employer does not meet the above-mentioned conditions or if the worker considers the risk of infection with the coronavirus to be too high for special reasons, despite the measures taken by the employer. The latter may require a medical certificate. If it is not possible to employ vulnerable workers in accordance with the above- mentioned provisions, or if the workers concerned justifiably reject the work assigned to them, the employer shall release them from work while continuing to pay their wages. The workers shall submit claims of their particular vulnerability by means of a personal declaration. The employer may request a medical certificate. Art. 7c(1)–(8) of the Ordinance on measures to fight the coronavirus (COVID-19) (Verordnung über Massnahmen zur Bekämpfung des Coronavirus, Covid-19, LR 818.101.24).

1.1.5 Unemployment benefits and compensation for short-time work Parliament has authorised the government to derogate by ordinance from a number of legal provisions concerning unemployment benefits and compensation for short-time work, to the extent necessary to fight the coronavirus (COVID-19) and mitigate its effects. Art. 94a of the Act on Unemployment Insurance and Insolvency Compensation (Gesetz über die Arbeitslosenversicherung und die Insolvenzentschädigung, Arbeitslosenversicherungsgesetz, ALVG, LR 837.0).

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The government has made use of this authorisation by issuing several special provisions in a specific ordinance. To mitigate the economic impacts of the coronavirus (COVID-19), this Ordinance facilitates the payment of unemployment benefits and short-time work compensation. The following provisions are examples: If an employment relationship is terminated by the employer due to the coronavirus pandemic before the expiry of the legally or contractually agreed notice period, the loss of working hours is deemed to be chargeable. Work loss caused by the coronavirus is, in principle, considered to be chargeable if it is associated with a decline in the demand for goods and services, an order of official measures or with other circumstances for which the employer is not responsible. Art. 1(2), 3, and 8 of the Ordinance on temporary unemployment insurance measures in connection with the coronavirus (COVID-19) (Verordnung über befristete Massnahmen im Bereich der Arbeitslosenversicherung in Zusammenhang mit dem Coronavirus, COVID-19, COVID-19-ALVV, LR 837.012).

2 Court Rulings Nothing to report.

3 Implications of CJEU Rulings and ECHR Nothing to report.

4 Other Relevant Information With the Brexit, the United Kingdom will not only leave the EU, it will also leave the European Economic Area (EEA). The EEA Exit Agreement was signed in London on 28 January 2020 and approved by the Liechtenstein Parliament (Landtag) on 29 January 2020. It has been applied provisionally since 1 February 2020. This is ensured by the Brexit Transitional Act (Brexit-Übergangsgesetz, Brexit-ÜG, LR 632.61, cf. Liechtensteinisches Landesgesetzblatt No. 50 of 31 January 2020).

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Lithuania

Summary The Lithuanian legislator has introduced a set of technical amendments to the Labour Code of 2017, which provide more clarity and legal certainty. Some of the novelties are of importance in terms of EU labour law as they affect transposition in relation to fixed-term contracts and temporary employment contracts. ______1 National Legislation 1.1 Measures to respond to COVID-19 crisis Nothing to report.

1.2 Other legislative developments 1.2.1 Amendments to the Labour Code On 21 May 2020, the legislator adopted a set of amendments to the Labour Code of 2017 (Law No. XIII-2944 of 21 May, Register of Legal Acts, 2020, No. 12135), which will come into force on 01 August 2020. There are approximately 40 new provisions that aim to eliminate some uncertainties and ambiguities of the Code, as the need for changes has become visible in the course of three years of the Code’s application in practice. Many of the amendments are of a technical nature (i.e. explanations, ameliorations of procedures, re-introduction of old norms, etc). Few provisions are directly related to the transposition of EU labour legislation:  Re-introduction (Article 41 (4) of the Labour Code) of the provision allowing employers to conclude (unlimited number of times – T.D.) fixed-term contracts with the employee, if he/she is temporarily filling a vacant post, which in accordance with legal provisions, should be filled by way of public competition. The already known regulation (2002-1917) will serve as a legal basis to conclude countless numbers of fixed-term contracts with no justification and no restriction on their maximum duration, which may cause problems in terms of complying with Directive 1990/70/EC;  New requirements for temporary work agencies as employers of temporary workers have been introduced (Article 72 (2) of the Labour Code). An employer who is party to a temporary employment contract may only be a temporary work agency that meets the new six criteria and is included in the list of temporary work agencies compiled by the State Labour Inspectorate and published on its website (Directive 2008/104/EC). The criteria seem to not be too rigid but they are indicative of a more cautious attitude by the policy makers toward this type of business.

2 Court Rulings Nothing to report.

3 Implications of CJEU Rulings and ECHR 3.1 Transfer of undertakings CJEU case C-298/18, Grafe and Pohle, 27 February 2020

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In Lithuania, there have been no similar cases or situations as those dealt with by the CJEU. There is, however, no indication that a different perception of the notion of ‘transfer of an undertaking’, as interpreted by the CJEU, would apply. The fact that resources, which were the property of the economic entity previously engaged in the economic activity, were transferred, is not an absolute requirement for the classification of a ‘transfer’ in Lithuania.

CJEU case C-344/18, ISS Facility Services, 26 March 2020 There have been no similar cases or situations in Lithuania. In fact, it is very unlikely that the courts would follow the argumentation of the CJEU because of the possible ‘division’ of the contact of employment and partial transfer of employees’ duties to several different new employers. This construct is unknown in Lithuania and therefore, the practical implementation could be rather problematic.

4 Other Relevant Information Nothing to report.

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Luxembourg

Summary Changes have been made to the temporary legislation related to the COVID-19 pandemic. ______1 National Legislation 1.1 Measures concerning the COVID-19 crisis No new laws or decrees associated with the COVID-19 pandemic have been passed. Furthermore, the pace of labour law reforms as a result of the crisis has decelerated. The list of authorised activities has been extended several times in Luxembourg, with a view to gradual economic opening. For example, bars and restaurants have been allowed to open under a number of conditions. The following measures have been taken: - Apprenticeship contracts. The time limits for the procedure for terminating apprenticeship contracts have been suspended (2). The deadline by which new apprentices must find a training supervisor/employer is to be extended (from November to December 2020) and to suspend the six-week period within which an apprentice must find a new supervisor following termination of his/her apprenticeship contract (11). - Family leave. Due to the (half-time) reopening of schools and childcare facilities, the leave for family reasons, which was previously available to almost all parents who had no alternative care for their children, has been substantially restricted. Apart from the classic case of caring for a child with an illness that already existed prior to the outbreak of the crisis, such leave can only be taken in the following cases (3): 1. The child is vulnerable. This vulnerability must be documented by a medical certificate. 2. The child is very young (children born on or after 1/9/2015). 3. The child is in school, but the school is closed because of the health crisis and there is no possibility for another school or care facility to take care of the child. A ministerial certificate must be produced in this case. For children attending school abroad, the Ministry decides on a case-by-case basis and based on a certificate from the authorities of the state of residence. - Family support leave. Minor adaptations and clarifications have been made to the family support leave scheme, allowing employees and self-employed persons to take care of family members who need assistance because of their age or due to disability (4). - Maximum working time. The circle of undertakings eligible for derogation to increase daily working time to 12 hours has been restricted. Previously, a number of commercial and craft activities were included, such as food shops and pharmacies; the derogation has now been limited to 'activities essential for maintaining the vital interests of the population' listed in Grand-Ducal Regulation (5). - Student contracts. Student contracts are, in principle, subject to certain restrictions, i.e. they must take place during school holidays and their duration may not exceed two months per year. Because of the increased need for staff to provide extra-curricular care for children following the partial opening of schools, these restrictions have been lifted for the period between 25 May 2020 and 15 July, the start of the school holidays (6). Students accepting such posts will therefore not be deprived of the opportunity to work during the rest of the holidays.

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- Medical examinations. The time limits for hospital staff to undergo medical examinations relating to occupational health had been suspended; this suspension has now been lifted (7). - Management of short-time work. Certain measures have been taken to facilitate the administrative management of short-time work (8). The job administration (ADEM) will also have direct access to social security data and certain other data to check the merits of applications. The statements do not have to be signed by the employees individually, but by the staff representatives. The time limit for issuing such a declaration is extended from 2 to 3 months following the occurrence of short- time work. - Fight against fraud in relation to short-time work. Recourse to short-time working has been massive, and it appears that a number of frauds have been committed. Until now, Article L. 511-14 of the Labour Code simply provided that subsidies granted on the basis of false or erroneous declarations are to be returned. The sanctions regime has been strengthened (9). From now on, as soon as subsidies are granted on the basis of deliberately false declarations and as soon as there is a deliberate failure to pay compensation to one or more of the employees concerned, respectively that subsidies have been used for purposes other than the payment of wages, the beneficiary must repay the totality of the sums received on the basis of all the applications submitted for crisis-related partial unemployment. The benefit of partial unemployment is withdrawn with immediate effect from the undertaking concerned. The text also provides that non-payment of compensation benefits to one or more employees and any use of the subsidies for other purposes is punishable by a fine of between EUR 251 and EUR 5,000. - List of activities. For a number of Grand-Ducal regulations, which had hitherto referred to a list as essential activities and authorised activities, it was decided to transfer the list of these activities into individual and specific annexes for each of these Grand-Ducal regulations (10). - Post-crisis preparation. To prepare for an exit from the state of emergency in accordance with the meaning of the Constitution (by 24 June 2020 at the latest), a number of decisions taken by way of emergency grand-ducal regulation are or will be replaced in the future by formal laws. This is required for all provisions that are supposed to have an effect after the state of emergency.

Subject Decree Replacing Content/Observations legislation

Family RGD  Law of Abolition of the condition that leave 25.5.2020 25.5.2020 children aged 13 or over must be (12) (13) (Bill No. hospitalized to benefit from leave for repealed 744 family reasons. mentioned in

FR 4/20 has been voted)

Family RGD  Bill No. 7583 As a transitional measure, between leave 25.5.2020 (link) 25 May 2020 and 15 July 2020, the (12) special and additional family-related repealed ; leave introduced as a result of the RGD crisis will only be maintained for parents whose children cannot be

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20.5.2020 cared for at school or in a childcare (3) facility because they have not obtained a place there. The duration of this additional leave is limited to the period during which it is impossible to place the child. The related expenses are borne by the State and not by the sickness and maternity insurance fund. In its opinion of 19/5/2020, the Council of State issued numerous criticisms, including two formal objections (opposition formelle).

Procedure RGD  Bill No. 7587 The suspension of the time limits for 25.5.2020 (link) bringing legal proceedings, including (14) before the Labour Court, is confirmed. The suspension of time limits in proceedings will cease with the end of the state of emergency.

Student RGD  Bill No. 7588 Lifting of restrictions on the hiring of contracts 11.5.2020 (link) students to ensure the extra- (15) curricular care of children (see above)

Sick pay RGD  Bill No. 7582 For reasons of administrative ease, 3.4.2020 (link) the rule that sickness benefits are (16) entirely paid by the State does not cease on the day the state of

emergency ends, but continues until the end of the month concerned (i.e. in principle, until the end of June). To help companies facing difficulties, interest on arrears of social security contributions will remain suspended until 31/12/2020. In its opinion of 19/5/2020, the Conseil d'Etat made only minor observations.

Sources: (1) Règlement grand-ducal du 26 mai 2020 portant modification du règlement grand- ducal modifié du 18 mars 2020 portant introduction d’une série de mesures dans le cadre de la lutte contre le Covid-19 (link). (2) Règlement grand-ducal du 20 mai 2020 portant suspension des délais prévus dans la procédure de résiliation du contrat d’apprentissage (link). (3) Règlement grand-ducal du 20 mai 2020 portant dérogation aux dispositions des articles L. 234-51 et L.234-53 du Code du travail (link).

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(4) Règlement grand-ducal du 15 mai 2020 portant modification du règlement grand- ducal du 3 avril 2020 portant introduction d’un congé pour soutien familial dans le cadre de la lutte contre le Covid-19 (link). (5) Règlement grand-ducal du 15 mai 2020 portant modification du règlement grand- ducal modifié du 27 mars 2020 portant introduction d’une dérogation à l’article L. 211- 12 du Code du travail (link). (6) Règlement grand-ducal du 15 mai 2020 portant dérogation aux dispositions 1° des articles L.151-1 alinéa 1er et L.151-4 du Code du travail (link). (7) Règlement grand-ducal du 11 mai 2020 portant abrogation du règlement grand- ducal modifié du 1er avril 2020 portant dérogation aux articles L. 322-2 et L. 326-1 à L. 326-12 du Code du travail (link). (8) Règlement grand-ducal du 29 avril 2020 portant dérogation aux dispositions des articles L. 511-13 et L. 621-3 du Code du travail relatifs à la procédure en matière de chômage partiel (link). (9) Règlement grand-ducal du 30 avril 2020 portant dérogation aux dispositions de l’article L. 511-14 du Code du travail (link). (10) Règlement grand-ducal du 11 mai 2020 portant modification du règlement grand- ducal du 27 mars 2020 portant introduction d’une dérogation à l’article L. 211-12 du Code du travail (link) ; Règlement grand-ducal du 11 mai 2020 portant modification du règlement grand-ducal du 8 avril 2020 portant dérogation à l’article L.551-2 du Code du travail (link) ; Règlement grand-ducal du 11 mai 2020 portant modification du règlement grand-ducal du 1er avril 2020 portant dérogation à l’article L. 585-6 du Code du travail (link) ; Règlement grand-ducal du 11 mai 2020 portant modification du règlement grand-ducal du 27 mars 2020 portant dérogation à l’article L. 122-1 du Code du travail (link). (11) Projet de loi n° 7593 relatif aux mesures temporaires dans le domaine de la formation professionnelle et portant dérogation à l'article L. 111-3, paragraphe 4, du Code du travail (link). (12) Règlement grand-ducal du 25 mai 2020 portant abrogation du règlement grand- ducal du 25 mars 2020 portant modification de l’article L. 234-52 du Code du travail (link). (13) Loi du 25 mai 2020 portant modification de l’article L. 234-52 du Code du travail (link). (14) Règlement grand-ducal du 25 mars 2020 portant suspension des délais en matière juridictionnelle et adaptation temporaire de certaines autres modalités procédurales (link). (15) Règlement grand-ducal du 11 mai 2020 portant modification du règlement grand- ducal du 27 mars 2020 portant introduction d’une dérogation à l’article L. 211-12 du Code du travail (link). (16) Règlement grand-ducal du 3 avril 2020 portant dérogation aux dispositions des articles 11, alinéa 2, 12, alinéa 3, 14, alinéa 2 et 428, alinéa 4 du Code de la sécurité sociale et L.121-6, paragraphe 3 du Code du travail (link).

2 Court Rulings Nothing to report.

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3 Implications of CJEU Rulings and ECHR 3.1 Transfer of undertakings without a transfer of operating resources CJEU case C-298/18, Grafe und Pohle, 27 February 2020 Decision C-298/18 concerns a very specific situation. To the author’s knowledge, no similar case has yet been dealt with in Luxembourg. In any event, Luxembourg’s legislation is copied verbatim from the European Directive, in particular with regard to the notion of transfers of undertakings. In disputes involving a transfer of undertaking, which are not very frequent, Luxembourg courts tend to systematically refer to European case law.

CJEU case C-344/18, ISS Facility Services, 26 March 2020 Decision C-344/18 is a very interesting solution, and there has been no similar case in Luxembourg. It is worth noting that the employment contract can be divided into two part-time contracts. It would thus also be possible for an employee to partially continue working for his/her former employer and to partially work for a new employer if not all of the activities are transferred..

4 Other Relevant Information Nothing to report.

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Malta

Summary The “Covid-19 Guarantee Scheme” and the “Interest Rate Subsidy Scheme” have been launched. ______1 National Legislation 1.1 Measures to respond to COVID-19 crisis Nothing to report.

1.2 Other legislative developments Nothing to report.

2 Court Rulings Nothing to report.

3 Implications of CJEU Rulings and ECHR 3.1 Transfer of undertakings CJEU case C-298/18, Grafe und Pohle, 27 February 2020 The CJEU ruled: “Article 1(1) of Council Directive 2001/23/EC of 12 March 2001 on the approximation of the laws of the Member States relating to the safeguarding of employees’ rights in the event of transfers of undertakings, businesses or parts of undertakings or businesses must be interpreted as meaning that, in the context of the takeover by an economic entity of an activity the pursuit of which requires substantial operating resources, under a procedure for the award of a public contract, the fact that that entity does not take over those resources, which are the property of the economic entity previously engaged in that activity, on account of legal, environmental and technical constraints imposed by the contracting authority, cannot necessarily preclude the classification of that takeover of activity as a transfer of an undertaking, since other factual circumstances, such as the taking‑over of the majority of the employees and the pursuit, without interruption, of that activity, make it possible to establish that the identity of the economic entity concerned has been retained, this being a matter for the referring court to assess.” Maltese law - Transfer of Undertakings (Protection of Employment) Regulations, SL 452.85 and Article 38 of the Employment and Industrial Relations Act (Chapter 452 of the Revised Edition of the Laws of Malta) does not exclude any type of transfer of undertaking. The result of this is that the final assessment is left to the industrial tribunal. There have been judgments in which a transfer of a lease has been deemed to be a transfer of an undertaking. In the judgment delivered on 05 October 2018, in the names of Antoinette Farrugia vs Optical (CCSG) Company Limited and Classic Group (Appeal No. 16/2018), the Court of Appeal (Inferior Jurisdiction) analysed what circumstances amount to a transfer of an

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undertaking within the remit of the Employment and Industrial Relations Act and the Transfer of Business (Protection of Employment) Regulations. The case in question involved a claim filed before the industrial tribunal by Antoinette Farrugia (hereinafter: claimant) who had been indefinitely employed with Optical (CCSG) Company Limited (hereinafter: Optical). On 08 December 2014, Optical informed the claimant that her employment contract would be terminated as of April 2015 due to redundancy because the company's contract to operate from the premises of the Malta International Airport ('MIA'), initially awarded by a tender, would not be extended. In the same termination letter, Optical informed the claimant that Classic Group Limited (hereinafter: Classic), an 'associated company', had agreed to ‘re- employ’ her. The claimant, however, refused the terms of the new employment agreement, which were less favourable than the terms she had with Optical, and challenged the termination decision, claiming that it was not on the basis of redundancy but on the basis of the transfer, and hence, she was entitled to the same conditions of employment as before. The Court of Appeal (in its Inferior Jurisdiction) had decided that a transfer of an undertaking had indeed taken place, and in its final comments, also stated that for a transfer of an undertaking to have taken place, it was not necessary for Classic to take control of Optical as the defendants had argued. The Court further stated that even if the transfer is effected in two stages, this does not exclude a business transfer under circumstances in which the new employer continues to perform the same or similar activities, thereby retaining the identity of the former business. In this case, the Court looked at a transfer that had been carried out in two stages. It is highly probable that since the Court has, in this case, relied extensively on CJEU judgments, it is very probable that the Court will take this judgment into consideration and decide accordingly should there be a case with facts similar to the above. Maltese law does not exclude such interpretation.

CJEU case C-344/18, ISS Facility Services, 26 March 2020 The CJEU ruled: “Where there is a transfer of undertaking involving a number of transferees, Article 3(1) of Council Directive 2001/23/EC of 12 March 2001 on the approximation of the laws of the Member States relating to the safeguarding of employees’ rights in the event of transfers of undertakings, businesses or parts of undertakings or businesses must be interpreted as meaning that the rights and obligations arising from a contract of employment are transferred to each of the transferees, in proportion to the tasks performed by the worker concerned, provided that the division of the contract of employment as a result of the transfer is possible and neither causes a worsening of working conditions nor adversely affects the safeguarding of the rights of workers guaranteed by that directive, which it is for the referring court to determine. If such a division were to be impossible to carry out or would adversely affect the rights of that worker, the transferee(s) would be regarded as being responsible for any consequent termination of the employment relationship, under Article 4 of that directive, even if that termination were to be initiated by the worker.” Maltese law does not preclude such an interpretation of the law. However it must be stated that no actual case-law on this point has been found. It is highly probable that Maltese courts would follow this interpretation of the law in view of the fact that in cases of transfers of undertakings, Maltese courts take the rulings of the CJEU into serious consideration.

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4 Other Relevant Information Nothing to report.

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Netherlands

Summary (I) An update on the COVID-19 developments with a focus on economic measures aiming at retaining employment is provided. (II) The government will not issue a legislative proposal providing for a minimum tariff for self-employed workers. (III) The Dutch Supreme Court published preliminary questions in a case to which Directive 2001/23/EC applies. ______

1 National Legislation 1.1 Measures to respond to COVID-19 crisis 1.1.1 General measures to protect the public health On 19 May 2020, the government announced a further easing of the restrictions. Basic rules such as keeping a 1.5 metre distance and hygiene remain in place. People are furthermore advised to continue working from home as much as possible and to avoid crowded places (instead of staying home as much as possible). As of 01 June 2020, secondary schools will open again and public life will also open (bars, restaurants, museums, theatres, cinemas may open again, with a maximum of 30 people inside). Public transportation will be running on a more frequent timetable again and it is compulsory to wear a mask in public transportation. In case of physical complaints such as cough or fever, staying at home is mandatory (also for other household members). A further easing of measures is expected as per 01 July 2020.

1.1.1 Economic measures 1.1..1 Temporary Emergency Bridging Measure to preserve employment (NOW) Regulation by the Minister of Social Affairs and Employment dated 31 March 2020 establishing a temporary subsidy scheme as a contribution towards wage costs to retain jobs in exceptional circumstances, Stcrt. 2020, 19874, as amended last by Decree of 26 May 2020, Stcrt. 2020, 29256 (see also earlier Flash Reports). The latest amendment of the NOW entails an extension of the application period (until 5 June 2020), amendments on the requested audit certificate and a provision that enables the UWV (which carries out the scheme) to publish the names of the companies that made use of scheme. On 03 June 2020, the UWV published new data on the use of the scheme. Between the launch of the scheme on 06 April 2020 until 03 June 2020, 144 000 applications were filed and 123 000 were awarded. Advance payments up to a total amount of EUR 4.5 billion have been made. With these advance payments, 2.1 million employees have been reached. Furthermore, the government has announced that a second tranche of the NOW scheme will be initiated (the current scheme closes on 05 June 2020), for four months (June to September) under different conditions. The scheme will commence on 06 July 2020, and the details have not been published yet. The main change to be expected is that

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companies will be allowed to restructure (and dismiss staff) whilst applying for NOW’s wage subsidy. There will be other conditions such as a prohibition to pay out bonuses or dividends and to buy (back) own shares. The wording of the new regulation is not available yet.

1.1..2 Temporary benefits for self-employed professionals (TOZO) Government Decree of 17 April 2020 establishing temporary rules regarding benefits for self-employed who have been financially hit by the consequences of the crisis connected to COVID-19, Stb. 2020, 118 (see also earlier Flash Reports). This scheme, which consists of income support for self-employed persons, will also be extended for four months (June up to and including September). The main change compared to the first scheme is that the partner income test will apply again.

1.1..3 Compensation for entrepreneurs in affected sectors (TOGS) Policy regulation on compensation for entrepreneurs in sectors affected by COVID-19 dated 27 March 2020, Stcrt. 2020, 19159 (see also earlier Flash Reports). This scheme, entailing a one-time fixed compensation for businesses in specific sectors, will be closed as per 26 June 2020.

1.1..4 Temporary Bridging Measure for Flex Workers (TOFA) No formal regulation available yet. Giving in to the strong push by Parliament, the government announced on 03 June 2020 that it will launch a temporary bridging measure for flex workers. This new scheme will compensate flex workers that were laid off after 01 March due to the coronavirus crisis, and who cannot claim benefits. Another condition is that the employee had a wage of at least EUR 400 gross per month in February 2020. The eligible employees can apply for a monthly benefit of EUR 550 for the months March, April and May 2020. The scheme will implemented by the UWV and aims to commence on 22 June for a period of three weeks.

1.2 Other legislative developments 1.1.1 Minimum tariffs for independent contractors The Flash Reports of July and October 2019 mentioned plans of the government to introduce a minimum tariff for independent contractors at the lower end of the labour market. Following internet consultations, the Minister of Social Affairs and Employment decided on 15 June 2020 to retract this plan. The main reason is that it will represent too much of an administrative burden, entail too much insecurity for the parties and will probably be difficult to enforce. Moreover, the level of support in society is very low.

2 Court Rulings 1.1 Transfer of undertakings Dutch Supreme Court, No. 18/04401, ECLI:NL:HR:2020:954, 29 May 2020, Heiploeg

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With reference to the April 2020 Flash Report, the Dutch Supreme Court has established the final preliminary questions on the applicability of Directive 2001/23/EG to a so-called ‘pre-pack’ situation and has requested clarification in the Smallsteps case.1

3 Implications of CJEU Rulings and ECHR 1.1 Transfer of undertakings without a transfer of operational resources CJEU case C-298/18, Grafe und Pohle, 27 February 2020 This case concerned the tendering of public passenger transport by bus. The company that was awarded the contract (through its fully owned subsidiary company OSL) recruited the majority of drivers and management staff from the company that had previously provided the bus transport service (SBN). OSL did not, however, purchase or lease SBN’s buses, depots and other operating facilities, or use its workshop services. The referring court asked whether the transfer of the operation of bus routes from one bus undertaking to another as a consequence of a tendering procedure could be considered a transfer of an undertaking within the meaning of Article 1(1) of Directive 77/187/EEC (now: Council Directive 2001/23/EC), even if no significant assets, in particular no buses, were transferred. Additionally, the referring court asked whether the fact that the buses owned by SBN did not meet the requirements set out in the tender could provide justification for the conclusion that taking over a significant proportion of the staff could also result in Directive 77/187 being applicable. The Court ruled that Article 1(1) of Council Directive 2001/23/EC must be interpreted as meaning that in the context of the takeover by an economic entity of an activity, the pursuit of which requires substantial operational resources, under a procedure for the awarding of a public contract, the fact that that entity does not take over those resources, on account of legal, environmental and technical constraints imposed by the contracting authority, could not necessarily preclude the classification of that takeover of activity as a transfer of an undertaking, since other factual circumstances, such as the taking over of the majority of the employees and the pursuit, without interruption, of that activity, made it possible to establish that the identity of the economic entity concerned had been retained. Whether or not this is the case is a matter for the referring court to assess. The ruling has no implications for Dutch law as it confirms and refines earlier case law. No amendments are needed since the applicable legislation (Article 7:662 and further Dutch Civil Code) are in conformity with the Court’s ruling. The case received brief attention in case notes, where the ruling is seen as a refinement of previous jurisprudence. It has received no attention so far in academic literature, nor in public debate.

1.2 Transfer of undertakings CJEU case C-344/18, ISS Facility Services, 26 March 2020 In this case, an employee had worked for one employer and had been a project leader of three cleaning projects. After a tender procedure, the three projects were awarded to two new companies, the transferees. The main question was whether the rights and obligations arising from a contract of employment that existed at the time of that transfer were transferred to each of the transferees, in proportion to the tasks performed by the employee, or only to the transferee for whom the employee would

1 ECJ 22 June 2017, C-126-16 (Smallsteps) ECLI:EU:C:2017:489.

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perform his or her principal tasks. Alternatively, the referring court asked whether that provision must be interpreted as meaning that the rights and obligations arising from the contract of employment cannot be asserted against either of the transferees. The CJEU ruled that the rights and obligations arising from a contract of employment are indeed transferred to each of the transferees in proportion to the tasks performed by the worker concerned, provided that the division of the contract of employment as a result of the transfer is possible and neither causes a deterioration of working conditions nor adversely affects the safeguarding of the rights of employees guaranteed by that Directive, which it is for the referring court to determine. If such a division were to be impossible to carry out or would adversely affect the rights of that employee, the transferee(s) would be regarded as being responsible for any consequent termination of the employment relationship under Article 4 of that Directive, even if that termination were to be initiated by the employee. Under national law, it has been debated for a long time whether the employment contract can be divided. This debate has particularly played a role with respect to the partial termination of an employment contract. Recent case law seems to indicate that the Dutch Supreme Court accepts partial terminations of the employment contract (Supreme Court 21 February 2020, ECLI:NL:HR:2020:283). It is, however, foreseeable that the division of an employment contract due to a transfer of undertaking might lead to practical issues, such as terms and conditions that cannot be divided easily (such as a leased car). Only one case note has appeared, not indicating that any issues are to be expected.

4 Other Relevant Information Nothing to report.

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Norway

Summary (I) The COVID-19 outbreak in Norway seems to be under control and the lockdown measures are gradually being lifted. In May, some of the existing measures continued to apply and/or were adapted. ______1 National Legislation 1.1 Measures to respond to COVID-19 crisis 1.1.1 Adaption of measures to respond to the COVID-19 outbreak Norwegian society was partially locked down 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. An overview of the national measures is available here. Former amendments to the Layoff Wage Act facilitated extensive use of temporary layoffs to prevent bankruptcy and job loss. The period for which the employer was responsible to pay the employees’ wages during layoff, was reduced from 15 to 2 days. After this period, employers are exempt for a maximum period of 26 weeks from the duty to pay wages. During this period, employees are usually entitled to unemployment benefits in accordance with the National Insurance Act Chapter 4. Temporary regulations on wage compensation were introduced to compensate for the reduction in income caused by the reduced period during which the employer pays the employee’s wages. Temporary regulations on sick leave and benefits, parental care leave and benefits, etc. were introduced in response to the containment measures and closed schools and kindergartens. Employers were i.a. required to accept self-certification of sickness in the first 16 days of sickness. Temporary regulations on advance payment of unemployment benefits were passed to compensate for delays in the management of the National Welfare Authorities. A number of other measures, relief aid packages, etc., were also introduced, as reported in Flash Report 4/2020. Norway gained control over the outbreak relatively quickly. A slow and gradual reopening of society began in April and continued in May. On 7 May 2020, the government introduced a time schedule for further downscaling of measures related to the COVID-19 outbreak. All primary schools and high schools were opened during week 20. Regulations on social distancing, quarantine and restrictions on different types of activities have gradually been lifted. The time schedule is available here. The unemployment rate rose sharply during the lockdown, and is now slowly declining. By the end of May, there were around 355 400 unemployed persons, which amounts to 12.6 per cent of the workforce. The number is 65 600 less than at the end of April (see the statistics here). In May, the government passed several regulations to continue and/or adapt existing measures to contain the impacts of the COVID-19 outbreak, most importantly:  Temporary regulations on wage compensation to employees during temporary layoff were extend until the end of August. The updated regulations are available here;  Temporary regulations on sick leave and benefits, parental care leave and benefits, etc. were extended and slightly modified. From 01 June, employers are no longer required to accept self-certification of sickness for the first 16 days of

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sickness, a medical certificate can be required as of day 4. The amendments are available here.  Temporary regulations on advanced payments of unemployment benefits were extended and adapted; the updated regulations are available here. In May, the Government also proposed extending and/or adapting a number of other measures. In the revised national budget, the government i.a. proposed extending the 26-week exemption period, for temporary layoffs already enacted due to the COVID-19 outbreak, to the end of October.

1.2 Other legislative developments 1.2.1 Health and safety New regulations on diving from ships were passed 27 April 2020 No. 876 pursuant to the Ship Safety Act with effect from 1 June 2020. The previous regulations were repealed in May. The new regulations aim to ensure that divers covered by the Ship Safety Act are protected by safety requirements on an equal basis as divers covered by the Working Environment Act. The new regulations can be found here, and the repeal can be found here.

2 Court Rulings Nothing to report.

3 Implications of CJEU Rulings and ECHR 3.1 Transfer of undertakings CJEU Case C-298/18, Grafe und Pohle, 27 February 2020 Local authorities in Germany issued a new tendering procedure for operating public bus services. The previous operator, the bus company SBN, did not participate, and ceased its business operations and terminated the employment of its employees, including the bus drivers Mr. Grafe and Mr. Pohle. The bus company OSL was awarded the contract from 01 August 2017, recruited a majority of SBN drivers and management staff, but did not purchase or lease any of SBN’s buses or operating facilities, etc. Mr. Grafe was recruited by OSL, but was treated as a new employee under the collective agreement, without recognising his nearly 30 years of service for SBN. Mr. Pohle was not employed by OSL. Both argued that their contracts of employment had been transferred from SBN to OSL, as a transfer of undertaking had taken place within the meaning of Directive 2001/23/EC. OSL relied on the CJEU ruling in Liikenne (case C- 172/99, EU:C:2001:59) to argue that no transfer of an undertaking had occurred, as no operating resources such as buses had been taken over. OSL’s decision not to take over the buses was, however, dictated by the requirements on environmental and technical standards in the tender, which the buses did not meet. The CJEU found that the classification as a transfer of an undertaking in the meaning of the Directive is not necessarily precluded when the decision not to take over the operating resources is dictated by external—legal, environmental or technical— constraints. It is possible to establish that the identity of the economic entity in question has been retained by other factual circumstances, such as the taking over of the majority of the employees and the uninterrupted pursuit of the activity. This is for the referring court to assess.

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The provisions in the Norwegian Working Environment Act Chapter 16 implement Directive 2001/23/EC and are interpreted in accordance with CJEU case law. Norwegian courts regularly refer to CJEU rulings. The Norwegian Supreme Court has specifically referred to Liikenne in cases concerning transactions of undertakings in which assets are considered essential to the operation, for example, in Rt. 2011 s. 1755, which concerned catering services to an airline company. It has been assumed that in these types of transactions, the takeover of assets is crucial to the assessment of whether the identity of the economic entity has been retained. Norwegian courts are expected to align their interpretations to the refined reasoning in Grafe and Pohle. Consequently, the assessment of transactions of undertakings in which assets are considered essential to the operation, must take account of possible external constraints.

CJEU case C-344/18, ISS Facility Services, 26 March 2020 Local authorities in Belgium issued a new tendering procedure for operating cleaning services, divided into three lots. The previous operator, ISS Facility Services, lost the tender. New contracts were awarded to Atialian (two lots) and Cleaning Masters (one lot). Mrs. Govaerts was a full-time project manager in ISS of the areas of work in all three lots. ISS and Mrs. Govaerts claimed that her contract of employment had been transferred to Atialian. It was undisputed before the CJEU that there was a transfer in the meaning of Directive 2003/21/EC. The question was how rights and obligations arising from a contract of employment are transferred in a situation involving several transferees. The Court stated that Article 3 (1) of the Directive does not envisage a situation involving several transferees. The Directive was considered to aim not solely to safeguard the interests of employees in the event of a transfer of an undertaking, but to seek to ensure a fair balance between the interests of the employees and of the transferee. The Court, therefore, on the one hand, rejected that rights and obligations cannot be asserted against either of the transferees, as this would deprive the Directive of any effectiveness. On the other hand, rights and obligations cannot be transferred solely to the transferee for whom the employee would principally work, as this would disregard the interests of that transferee. The Court concluded that the employee’s rights and obligations must be transferred to each of the transferees pro rata in proportion to the tasks performed by the worker concerned. If such a division is not possible or would adversely affect the rights of that worker, the transferee(s) will be regarded as responsible for any consequent termination of the employment relationship. Norwegian courts interpret relevant rules in accordance with the case law of the CJEU (see above). There does not seem to be any previous Norwegian case law on how to transfer rights and obligations of an employment contract in a situation involving several transferees. However, the Norwegian Working Environment Act § 16-2 (1) stipulates that rights and obligations arising from a contract of employment are transferred to “the new employer” in singular. Aligning the interpretation of Norwegian courts will thus require an expanded interpretation of the wording of the act. This can be achieved within the interpretive tradition of the courts. The relevant provision in the act also refers to the transferor as the “the previous employer” in singular. This did not prevent the Norwegian Supreme Court to align its interpretation with the ruling in Albron (case C-242/09, EU:C:2010:625) in Rt. 2012 s. 983. Here, the Court built on the CJEU’s finding that there can be two employers (a contractual and a non-contractual) and thus two possible transferors.

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In similar cases, Norwegian courts can therefore be expected to interpret the Norwegian Working Environment Act § 16-2 (1) in accordance with ISS Facility Services.

4 Other Relevant Information Nothing to report.

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Poland

Summary The Law of 14 May has introduced some changes to the ‘anti-crisis shield’. Unlike the initial anti-crisis regulations, the new law regulates labour law matters to a very limited extent only. ______1 National Legislation 1.1 Measures to respond to COVID-19 crisis 1.1.1 Amendments to the ‘anti-crisis shield’ package On 14 May, the Law on amendments to several laws within the scope of protective measures connected to the prevention of the spread of the SARS-CoV-2 virus (Ustawa o zmianie niektórych ustaw w zakresie działań osłonowych w związku z rozprzestrzenianiem się wirusa SARS-CoV-2, Journal of Laws 2020, item 875) was enacted. The Law amended numerous legal acts, including the Law of 02 March 2020 on particular measures preventing, averting and fighting COVID-19, other infectious diseases and crisis situations caused by them (Ustawa o szczególnych rozwiązaniach związanych z zapobieganiem, przeciwdziałaniem I zwalczaniem COVID-19, innych chorób zakaźnych oraz wywołanych nimi sytuacji kryzysowych, the original ‘anti-crisis shield’ package; this piece of legislation was introduced and analysed in the March and April 2020 Flash Reports). The Law of 14 May introduced changes to the so-called ‘anti-crisis shield’. The new regulations have been named ‘anti-crisis shield 3.0’. Unlike previous coronavirus measures, the new law only refers to labour law matters to a very limited extent. The new regulations took effect on 16 May. Information on the legislative process is available here. The text of Law of 02 March 2020 (the original ‘anti-crisis shield’ package) can be found here (introduced and analysed in the March and April 2020 Flash Reports). http://prawo.sejm.gov.pl/isap.nsf/download.xsp/WDU20200000374/U/D20200374Lj.p df Two issues introduced by the Law of 14 May should be mentioned. The newly inserted Article 4e of the Law of 02 March 2020 on specific measures preventing, averting and fighting COVID-19, other infectious diseases and crisis situations caused by them, refers to the work of employees in social assistance institutions. The provision concerns the entities that provide 24/7 care for persons in need, or provide continuous assistance to people with disabilities, people with long-term illnesses or elderly people. Under the new regulation, employees of such entities, who are in quarantine, can perform work as agreed in the employment contract during this period, if they consent to do so. In that case, they receive remuneration for work, and not sickness benefits. Secondly, Article 15zq of the Law of 02 March 2020 on the work stoppage benefit was amended. This benefit provides financial support for some persons who perform work outside an employment contract (for details, see March 2020 Flash Report, ‘National legislation’, section 8). Following the amendment, entrepreneurs who commenced their activities before 01 April 2020, and not before 01 February 2020, can apply for the benefit. Thus, entrepreneurs who only recently commenced their activities and experienced negative consequences due to the coronavirus epidemic can also apply for the benefit.

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1.2 Other legislative developments Nothing to report.

2 Court Rulings Nothing to report.

3 Implications of CJEU Rulings and ECHR 3.1 Transfer of undertakings CJEU case C-298/18, Grafe und Pohle, 27 February 2020 Under Polish law, transfers of undertakings are regulated in Article 231 of the Labour Code (consolidated text Journal of Laws 2019, item 1040; hereinafter: LC). Article 231 § 1 LC provides that if a work establishment or of a part thereof has been transferred to another employer, that employer, by operation of the law, becomes a party to the existing employment relationships. There are no further statutory criteria to determine the ‘transfer of an undertaking’. This notion is very broad. In practice, Polish courts refer to judicial decisions of the CJEU on the criteria to determine the existence of the transfer of an undertaking, and they take recourse to pro-union interpretation of Polish law. In Poland, there have been no reported rulings that explicitly refer to the taking over of the operation of bus routes. However, the taking over of particular activities by another economic entity (awards of public contract included) would clearly fall within the scope of Article 231 § 1 LC.

CJEU case C-344/18, ISS Facility Services, 26 March 2020 As indicated above (section 3.1), in Poland, Article 231 § 1 LC provides that if a work establishment or of a part thereof has been transferred to another employer, that employer, by operation of the law, becomes a party to the existing employment relationships. Under Article 231 § 2 LC, the previous and the current employer are jointly and severally liable for any duties resulting from the employment relationship that existed before the transfer of part of the establishment to the new employer. According to Article 231 § 4 LC, within two months of the transfer of a work establishment or of a part thereof to another employer, the employee may terminate the employment relationship without notice, giving a seven-day notification. Such termination of the employment relationship has the same effect on the employee as those provided for in the labour law in relation to terminations with notice of the employment relationship by the employer. Moreover, Article 231 § 6 LC provides that a transfer of a work establishment or of a part thereof to another employer cannot constitute a reason justifying termination with notice of an employment relationship by the employer. According to the abovementioned provisions, employee rights in case of a transfer of an undertaking should be safeguarded, and the employee may terminate the employment relationship without any negative consequence, if he/she does not intend to continue the employment relationship with the new employer. As indicated in section 3.1 above, the scope of application of a ‘transfer of an undertaking’ under Article 231 § 1 LC is very broad indeed. There is no doubt that if the tasks performed by an economic entity have been taken over by another entity, the case falls within the scope of Article 231 § 1 LC. Polish courts would likely follow the

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position that in case of a division of tasks performed by the economic entity, the rights and obligations arising from a contract of employment will be transferred to each of the transferees in proportion to the tasks performed by the worker concerned (depending on factual circumstances). Under Polish law, the transfer of an undertaking should not imply deteriorating employment conditions, and the transfer as such does not constitute a reason for dismissal. Should any action of the employer lead to changes in the employee’s working conditions, the employee can terminate the employment relationship without any negative consequences. Article 231 § 4 LC expressly provides that such an action is regarded as a termination of the employment relationship by the employer.

4 Other Relevant Information Nothing to report.

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Portugal

Summary (I) Amendments to the exceptional and temporary measures have been implemented to address the COVID-19 pandemic: wage compensation for fishermen who are prevented from exercising their activity, social protection, reinforced powers to the Authority for Work Conditions, revised limits to overtime work. (II) A Resolution of the National Assembly recommends measures to safeguard the rights of workers in the surveillance and cleaning sectors. (III) A Ministerial Ordinance clarifies amendments to the employment support system called ‘+CO3SO Emprego’. (IV) Two resolutions of the Council of Ministers introduce the first and second renewal of the state of emergency. ______1 National Legislation 1.1 Measures to respond to COVID-19 crisis 1.1.1 Measures in the context of COVID-19 with impacts on labour issues 1.1.1.1 Decree Law No. 20/2020 of 01 May Decree Law No. 20/2020 was published on 01 May 2020 (an English version of this Decree Law is available here) and was subsequently rectified by the Declaration of Rectification No. 18-C/2020, of 05 May. This decree introduces changes and amendments to, among others, Decree Law No. 10- A/2020, of 13 March, which established exceptional and temporary measures related to the COVID-19 pandemic that have an impact on employment-related issues, such as: (i) Body temperature check in the workplace In the current context and solely for reasons of protection of the health of workers and third parties, body temperature measurements may be performed on workers who want to access and perform work in the workplace. This measurement does not prejudice the right to data protection, and it is prohibited to register the result, unless the worker consents to such recording. If the temperature is higher than the normal body temperature, the worker can be prevented from accessing the workplace. (ii) Justified absence from work for some categories of workers A special protective regime applies to immunosuppressed individuals and people with chronic diseases who, according to the guidelines of the health authority, should be considered high risk individuals. These workers can justify their absence from work by means of a medical declaration, provided that they cannot perform their activity through teleworking (this regime does not apply to workers of essential services). (iii) Simplified lay-off Companies with establishments whose activities have been subject to a lifting of restrictions after the end of the state of emergency or to a lifting of restrictions imposed by a legislative or administrative decree may continue to implement ‘simplified lay-offs’ set forth in Decree Law No. 10-G/2020, of 26 March, as long as they resume their activity within eight days after such a lifting. (iv) Risk assessment in the workplace

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Companies must prepare a contingency plan for the workplace in accordance with the guidelines of the health authorities (Direcção-Geral da Saúde) and the Authority for Labour Conditions (Autoridade para as Condições do Trabalho). This Decree Law entered into force on 03 May 2020.

1.1.1.2 Decree Law No. 20-B/2020, of 6 May This Decree Law (an English version of this Decree Law is available here) establishes the criteria for temporary and exceptional wage compensation for fishermen who are prevented from exercising their activity due to the compulsory stoppage resulting from the outbreak of the COVID-19 virus. These professionals are to be compensated for their salaries, provided that  the impediment to the exercise of fishing is proven, as a result of a fall in the value of fish by 40 per cent or more compared to the equivalent period of one of the previous two years or  difficulty to recruit crews due to preventive isolation associated with the COVID- 19 pandemic is proven. The planned salary compensation scheme is subsidiary to other financial support schemes and cannot be combined with any financial support for the same purpose, income replacement benefit or training allowance. The application for payment of salary compensation shall be addressed to the Fishermen's Compensation Fund. This decree entered into force on 07 May 2020.

1.1.1.3 Decree Law No. 20-C/2020, of 07 May This Decree Law (an English version of this Decree Law is available here) establishes exceptional measures of social protection in the context of the COVID-19 pandemic, namely:  temporary measures to strengthen unemployment protection, and  simplification of access to social inclusion income. Moreover, this decree changes and amends Decree Law No. 10-A/2020, of 13 March. Concretely, it:  widens the suspension of the limits applicable to overtime work in accordance with the legal framework applicable to civil servants (“Lei Geral do Trabalho em Funções Públicas”) and the Labour Code - rendered by workers of bodies, services and other entities of the Ministry of Health, security forces, the National Authority for Emergency and Civil Protection, Armed Forces Hospital, National Institute of Legal Medicine, Social Security Institute, Authority for Labour Conditions, institutions of social solidarity and other associations that carry out essential activities in the social and health fields;  states that the rules on support measures to self-employed workers are applicable to corporate bodies, regardless of the circumstance of having, or not, dependent workers, and amends rules on the criteria for its application, the amount of the support and the possibility of renewing it;  envisages an extraordinary incentive measure (which consists of financial support) to the exercise of professional activity, applicable to workers who, in March 2020, were exclusively covered by the self-employed regime;

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 sets forth a specific measure to frame situations of social protection, which consists of financial support for individuals who are not covered by a social security regime (national or foreign) and have declared the beginning or re- commencement of an independent activity with the tax administration. Furthermore, the aforementioned decree amends Decree Law No. 10-F/2020, of 26 March, establishing new rules on the maintenance of the right to deferred payment of contributions by employers. This decree entered into force on 08 May 2020.

1.1.1.4 Law No. 14/2020, of 09 May This Law approves several amendments to Law No. 1-A/2020, of 19 March, which establishes exceptional and temporary measures to respond to the epidemiological situation caused by the COVID-19 pandemic. In particular, it extends the reinforcement of the powers given to the Authority for Work Conditions (Autoridade para as Condições do Trabalho) on the verification of the existence of evidence of unlawful dismissal and the suspension of such dismissal until the rectification of the situation by the employer or the final decision of the court beyond the state of emergency (during the term of this law). This law entered into force on 10 May 2020.

1.1.1.5 Decree Law No. 22/2020, of 16 May This Decree Law introduces amendments to Decree Law No. 10-A/2020, of March 13. Specifically, it (i) widens the suspension of the limits applicable to overtime work in accordance with the legal framework applicable to civil servants (“Lei Geral do Trabalho em Funções Públicas”) and the Labour Code, to the essential services of local authorities, and (ii) specifies the rules on the use of filter masks or visors when accessing and performing work in trade establishments, public attendance services, schools and kindergartens. This decree entered into force on 13 March 2020 and addresses the changes highlighted in point (i), and on 17 May 2020, the changes highlighted in point (ii) above were introduced.

1.1.1.6 Decree Law No. 24-A/2020, of 29 May This Decree Law introduces changes and amendments to Decree Law No. 10-A/2020 of 13 March. Specifically, this decree:  clarifies the meaning of essential services of local authorities for the purposes of the suspension of the limits applicable to overtime work in accordance with the legal framework applicable to civil servants (“Lei Geral do Trabalho em Funções Públicas”) and the Labour Code;  clarifies the mandatory use of filter masks or visors, and  specifies the conditions for the attribution of financial support to situations of social protection set forth in Decree Law No. 20-C/2020 of 07 May.

1.1.2 Rights of workers in surveillance and cleaning This Resolution of the National Assembly No. 24/2020, of 11 May recommends the adoption of measures to safeguard the rights of workers in the surveillance and cleaning

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sectors, especially as regards the maintenance of acquired rights in a context of a transfer of an undertaking.

1.1.3 Employment support system This Ministerial Ordinance No. 128/2020, of 26 May, proposes amendments to Ministerial Ordinance No. 50/2020, which created the employment support system called ‘+CO3SO Emprego’. Concretely, this decree clarifies the rules regarding:  the territorial scope of the modality ‘+CO3SO Emprego Interior’, and  the limits of eligible costs, which may consist of the object of this support system. This decree entered into force on 27 May 2020 (reporting its effects on the date of entry into force of Ministerial Ordinance No. 50/2020, i.e. 29 February 2020).

1.1.4 Renewal of the declaration of the state of emergency 1.1.4.1 Resolution of the Council of Ministers No. 38/2020, of 17 May This Resolution renews the declaration of the state of emergency in the entire national territory, from May 18 until the end of the month. This decree  maintains the civic duty of staying at home and prioritises activities that do not imply extended social contact;  maintains the general obligation to perform remote work, where feasible, although stipulating that when not possible, the adoption of daily or weekly rotation should be introduced, with different entry and exit schedules;  widens the termination of the suspension of activity of trade establishments, albeit allowing the opening of local commerce with direct entrance from the street and with a limited dimension of 400 square meters;  allows the opening of catering establishments, but their occupancy may not exceed 50 per cent of the respective capacity, and in accordance with the performance of the guidelines for hygiene and sanitation of the Directorate- General for Health (Direcção-Geral de Saúde); and  establishes rules for access to museums, monuments, palaces, archaeological sites and similar. This decree entered into force on 18 May 2020.

1.1.4.2 Resolution of the Council of Ministers No. 40-A/2020, of 29 May This Resolution renews the declaration of the state of emergency in the entire national territory. It should be noted in this regard that the population no longer has to fulfil the civic duty of remaining at home. Another relevant change refers to teleworking, which is no longer mandatory, except in the following cases:  when required by the worker who finds him-/herself in one of the following situations (provided that the functions can be carried out under this regime): o workers covered by the special regime for immunosuppressed individuals or workers with chronical diseases; o workers with a degree of disability equal or higher than 60 per cent; o workers with a child or other dependent under the age of 12 years or, regardless of age, with a disability or chronical illness, in the context of

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suspension of school activities (excluding the period of interruption of teaching activities);  regardless of the type of employment relationship and provided that the functions can be carried out under a teleworking 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). Outside the cases referred to above, the teleworking regime may be adopted under the terms defined in the Labour Code (which requires an agreement between the employer and the employee). Furthermore, if not teleworking regime is adopted, the employer may implement preventive measures, namely the adoption of daily or weekly rotation between teleworking and work performed in the usual workplace, different entrance and exit schedules and different times for breaks and meals. Moreover, this decree:  widens the set of trade establishments that may function, allowing the opening of those with an area higher than 400 square meters;  stipulates that catering establishments and similar no longer have to adhere to restrictions regarding their occupation, without prejudice to complying with all hygiene and sanitary guidelines of the Directorate-General for Health (Direcção- Geral de Saúde) defined for the sector. It must also be noted that this Resolution establishes some exceptions regarding the functioning and occupation of trade establishments in the Metropolitan Area of . This decree entered into force on 01 June 2020.

1.2 Other legislative developments Nothing to report.

2 Court Rulings Nothing to report.

3 Implications of CJEU Rulings and ECHR 3.1 Transfer of undertakings CJEU case C-298/18, Grafe und Pohle, 27 February 2020, and CJEU case C-344/18, ISS Facility Services, 26 March 2020 The recent CJEU decisions issued in cases C-298/18 and C-344/18 concern the interpretation of some provisions of Directive 2001/23/EC, on the approximation of the laws of the Member States relating to the safeguarding of employees’ rights in the event of transfers of undertakings, businesses or parts of businesses. Specifically, in case C-298/18, the CJEU analysed whether Article 1(1) of Directive 2001/23/EC must be interpreted as meaning that, in the context of a takeover by an economic entity of an activity under a procedure for the award of a public contract, the fact that such an entity has not taken over the operating resources owned by the economic entity previously engaged in that activity precludes the classification of that transaction as a transfer of an undertaking.

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This issue is related to the interpretation of the concept of ‘transfer of an undertaking’ for the purpose of Directive 2001/23/EC. Pursuant to Article 1 (1) (b) of that Directive, “there is a transfer within the meaning of this Directive where there is a transfer of an economic entity which retains its identity, meaning an organised grouping of resources which has the objective of pursuing an economic activity, whether or not that activity is central or ancillary”. Following the case law of the CJEU, the court considers that the decisive criteria for establishing the existence of a transfer in the relevant situation is the fact that the economic entity in question retains its identity, as indicated inter alia by the fact that its operation is actually continued or resumed. According to the CJEU, “(i)n order to determine whether that condition is met, it is necessary to consider all the facts characterising the transaction concerned, including in particular the type of undertaking or business concerned, whether or not its tangible assets, such as buildings and movable property, are transferred, the value of its intangible assets at the time of the transfer, whether or not the majority of its employees are taken over by the new employer, whether or not its customers are transferred, the degree of similarity between the activities carried on before and after the transfer, and the period, if any, for which those activities were suspended. However, all those circumstances are merely single factors in the overall assessment which must be made and cannot therefore be considered in isolation (…)”. In fact, “the degree of importance to be attached to each criterion will necessarily vary according to the activity carried on and the production or operating methods employed in the undertaking, business or part of a business (…)”. In a previous similar case (Liikenne – C-179/99), the CJEU understood that although the fact that tangible assets used to operate the bus routes were not transferred from the old to the new contractor should be taken into account, it does not mean that the takeover of the buses must be regarded in the abstract as the sole determining factor of whether an undertaking whose activity consists in the public transport of passengers by bus has been transferred. Therefore, to determine whether the fact that the operating resources, namely the buses, were not transferred precludes the classification as a transfer of an undertaking, the particular circumstances of the case must be taken into account. In this case, the fact that there is no transfer of operational resources, namely the buses, to the transferee results from legal, environmental or technical constraints. Based on this, in case C-298/18, the CJEU ruled that the referred Article 1 (1) of Directive 2001/23/EC “must be interpreted as meaning that, in the context of the takeover by an economic entity of an activity the pursuit of which requires substantial operating resources, under a procedure for the award of a public contract, the fact that that entity does not take over those resources, which are the property of the economic entity previously engaged in that activity, on account of legal, environmental and technical constraints imposed by the contracting authority, cannot necessarily preclude the classification of that takeover of activity as a transfer of an undertaking, since other factual circumstances, such as the taking-over of the majority of the employees and the pursuit, without interruption, of that activity, make it possible to establish that the identity of the economic entity concerned has been retained, this being a matter for the referring court to assess”. The Portuguese Labour Code (hereinafter: PLC) transposed Directive 2001/23/EC into the Portuguese legal framework. According to Article 285 (1) of PLC, there is a transfer of an undertaking for the purposes of Portuguese law when the assignment, by any

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means of form, of ownership of an undertaking, the establishment or part of an undertaking or an establishment that constitutes an ‘economic unit’ occurs. For this purpose, an “economic unit” is deemed to be the aggregate of organised means constituting a productive unit with technical and organisational autonomy which retains an own identity, with the purpose of carrying out an economic activity, principal or accessory (Article 285 (5)). Portuguese courts have considered that the abovementioned definition of a transfer of an undertaking should be interpreted in accordance with the CJEU’s decisions. Therefore, the referred ruling issued in case C-298/18 is relevant to the densification of the concept of a transfer of an economic unit envisaged in Article 285 (5) of PLC. In case C-344/18, the CJEU interpreted Article 3(1) of Directive 2001/23/EC, which sets forth that “(t)he transferor’s rights and obligations arising from a contract of employment or from an employment relationship existing on the date of a transfer shall, by reason of such transfer, be transferred to the transferee”. Specifically, it was analysed whether when a transfer of an undertaking occurs within the meaning of Article 1(1) of Directive 2001/23/EC, involving a number of transferees, Article 3(1) of that Directive must be interpreted as meaning that the rights and obligations arising from a contract of employment that exists at the time of that transfer are transferred to each of the transferees, in proportion to tasks performed by that worker, or only to the transferee for whom the worker will perform his/her principal tasks or, alternatively, whether that provision must be interpreted as meaning that the rights and obligations arising from the contract of employment cannot be asserted against either of the transferees. According to the CJEU, the last alternative referred to above should be rejected because it implies the exclusion of the safeguarding of the rights and obligations arising from a contract of employment that existed on the date of the transfer of an undertaking and, consequently, it is contrary to the aim of Directive 2001/23/EC. As regards the possibility of transferring the contract of employment solely to the transferee with whom the employee is to perform his/her principal tasks, the CJEU considered that such an interpretation of Article 3 (1) of the Directive has the effect of disregarding the interest of the transferee, which has to assume all rights and obligations arising from a full-time employment contract, although the employee only performs his/her tasks to the transferee in part time. On the other hand, the possibility of transferring to each of the transferees the rights and obligations arising from the contract of employment entered into with the transferor, in proportion to the tasks performed by the employee, should be assessed in accordance with the definition of the contract of employment and the employment relationship provided by national law. Regarding this issue, the CJEU considered that “such a transfer of the rights and obligations arising from a contract of employment to each of the transferees, in proportion to the tasks performed by the worker, makes it possible, in principle, to ensure a fair balance between protection of interests of workers and protection of the interests of transferees, since the worker obtains the safeguarding of the rights arising from his or her contract of employment, while the transferees do not have imposed on them obligations that are greater than those entailed by the transfer to them of the undertaking concerned”. Taking into account the above, the CJEU concluded in the ruling of case C-344/18 that where there is a transfer of undertaking involving a number of transferees, Article 3(1) of Directive 2001/23/EC “must be interpreted as meaning that the rights and obligations arising from a contract of employment are transferred to each of the transferees, in proportion

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to the tasks performed by the worker concerned, provided that the division of the contract of employment as a result of the transfer is possible and neither causes a worsening of working conditions nor adversely affects the safeguarding of the rights of workers guaranteed by that directive, which it is for the referring court to determine. If such a division were to be impossible to carry out or would adversely affect the rights of that worker, the transferee(s) would be regarded as being responsible for any consequent termination of the employment relationship, under Article 4 of that directive, even if that termination were to be initiated by the worker”. According to Article 285 (1) and (3) of PLC, in the event of an 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 takes on the contractual position of employer of the employees fully 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. In case the activity performed by the employee is transferred to two or more transferees, the interpretation of Article 3 (1) of Directive 2001/23/EC, which was defended by the CJEU in the ruling of case C-344/18—according to which the rights and obligations arising from the contract of employment are transferred to each of the transferees, in proportion to the tasks performed by the employee—seems to be the most consistent with Portuguese law. Therefore, in that case, as a result of the transfer of an undertaking, it would be considered that the employee is bound to the transferees by part-time employment contracts.

4 Other Relevant Information Nothing to report.

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Romania

Summary The state of emergency ended on 15 May 2020, followed by the establishment of a state of alert for another 30 days. During this time, measures were ordered to reduce the impact of the COVID-19 crisis on the economy, as well as on the health of workers. ______1 National Legislation 1.1 Measures to respond to COVID-19 crisis 1.1.1 Labour market support (i) Extension of technical unemployment During the state of emergency, employers who faced economic difficulties and suspended employment contracts, received the amount of money they needed from the State to pay their employees’ technical unemployment benefits (see also March 2020 Flash Report). During this period, the technical unemployment benefit was borne by the unemployment insurance budget, amounting to 75 per cent of the employee’ s salary, but not more than 75 per cent of the national average salary in the economy. This measure was extended until 31 May 2020 by Government Emergency Ordinance No. 70/2020 (Official Gazette of Romania No. 394 of 14 May 2020). In addition, the granting of technical unemployment benefits for employees as well as benefits for self- employed persons for all areas of activity in which restrictions are maintained, was extended until after 31 May 2020, i.e. until these restrictions are lifted. In other words, the support measure is granted:  during the state of emergency,  until 31 May, as a rule;  after 01 June, but only for areas where activity is still restricted. After the end of the emergency measures, technical unemployment can continue under the general rules of the Labour Code, the indemnity being supported by the employers' budgets. (ii) Incentives for employers to retain employment contracts Emergency Ordinance No. 92/2020 for the establishment of active support measures for employees and employers in the context of the epidemiological crisis caused by the spread of SARS-CoV-2, as well as for the amendment of some normative acts (Official Gazette of Romania No. 459 of 29 May 2020) established a measure to prevent lay-offs. After 01 June, employers who have maintained employment contracts, after they were suspended in the context of the COVID crisis, benefit from state support for the payment of a part of the salary due. Such employers will receive payment of 41.5 per cent of the salary of each employee retained, but not more than 41.5 per cent of the average gross earnings in the economy from the state budget of unemployment, for a period of three months. The allowance is only granted if, during the state of emergency or alert, the employees’ employment contract was suspended for at least 15 days. Instead, employers are required to not dismiss the workers until 31 December 2020, with the exception of seasonal workers. Hence, the amount of 41.5 per cent is received

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for the first 3 months, and the employers will have to then retain the employment contracts in force for another 4 months. This measure is not applicable in the public sector. (iii) Employment of people at the beginning and at the end of their career. In Romania, at the end of May 2020, as a result of the COVID-19 crisis, almost 430 000 employment contracts had already been terminated. Under these circumstances, the government adopted Emergency Ordinance No. 92/2020 to reduce the impact of redundancies on the labour market, especially for people who will face greater difficulty finding employment. The following are considered:  Persons over the age of 50 years;  Persons between 16 and 29 years of age.  Employers who, between 01 June and 31 December 2020, hire job seekers from the above age categories, will be able to obtain 50 per cent of their salary for one year, up to LEI 2 500 (a sum that is equivalent to the national gross minimum wage).  Employers are required to maintain employment for at least another year. Otherwise, they will be required to reimburse the amounts collected for each person for whom the employment relationship ended before the 12-month period, plus interest, if the termination took place:  by agreement between the parties;  because of the nullity of the employment contract;  as a result of reinstatement, by court order, of the employee previously employed in that position;  by dismissal for reasons not related to the individual concerned. This measure does not apply in the public sector, either.

1.1.2 Measures to protect the health of workers Law No. 55/2020 on some measures to prevent and fight the effects of COVID-19 (Official Gazette of Romania No. 396 of 15 May 2020) provides in Article 21 that during the state of alert (the state of alert was declared after the end of the state of emergency, for 30 days (May 18 - June 17). It is likely to be extended) public and private sector employers with more than 50 employees may unilaterally establish individualised work programmes, so that employees start and end the work schedule in at least three groupings. It is a staggered work schedule, meant to avoid congestion at the beginning and end of the working day. During the state of alert, each employer must comply with a series of rules established by Order No. 3577/831/2020 on measures to prevent the spread of SARS-CoV-2 and to ensure work can be performed in safe conditions and protection of health at work during the state of alert (Official Gazette of Romania No. 403 of 16 May 2020), and Order No. 874/81/2020 on the establishment of the obligation to wear a protective mask, epidemiological triage and mandatory disinfection of hands to prevent SARS-CoV-2 infection during the state of alert (Official Gazette No. 435 of 22 May 2020). The rules concern the organisation of work, the maintenance of social distancing between workers and measures to limit the risk of infection with COVID-19.

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1.1.3 Collective labour relations According to Article 20 of Law 55/2020, the validity of collective labour agreements has been extended during the state of alert, as well as for a period of 90 days after its termination. Usually, even if they should have expired in the meantime, collective bargaining agreements remain valid until 14 September 2020. At the same time, the deadline for initiation by the employer of collective bargaining for a new collective agreement has also been postponed, if the previous one has expired. Collective labour disputes are prohibited in the units of the national energy system, in the operating units of the nuclear sectors, in the emergency services, in the health and social assistance units, telecommunications, the public radio and television, in railway transport, in the units that ensure public transport and sanitation, as well as supplying the population with gas, electricity, heat and water.

1.2 Other legislative developments Nothing to report.

2 Court Rulings Nothing to report

3 Implications of CJEU Rulings and ECHR 3.1 Transfer of undertakings CJEU case C-298/18, Grafe und Pohle, 27 February 2020 Directive 2001/23/EC on transfers of undertakings has been transposed into Romanian legislation through Law No. 67/2006 on the protection of the rights of employees in the event of transfers of undertakings, businesses or parts thereof. Romanian law defines a transfer of an undertaking as a change in ownership from the hands of the transferor to those of the transferee. The reference to "ownership" already leads to a more restrictive interpretation of the concept of transfer of an undertaking than the one provided for in the Directive. In line with Romanian national legislation, a legal situation like the one in the present case, in which no transfer of ownership on tangible assets involved took place would not be considered a case of a transfer of an undertaking. Therefore, case C 298/18 Grafe may have implications for future Romanian legislation, resulting in the legislator opting for a broader definition of the concept of transfers of undertakings.

CJEU case C-344/18, ISS Facility Services, 26 March 2020 Case C 344/18 ISS Facility Services NV examined the application of the rules of Directive 2001/23/EC on transfers of undertakings when the transfer of the undertaking involves two or more transferees, and the activities performed by an employee are to be distributed among them. The Romanian courts have not yet dealt with a similar problem discussed in this case. It is possible that if they had had to deal with this question, the Romanian courts would have opted for a solution similar to that of the European court. The solution would

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nevertheless depend on the extent to which, following the transfer, the employee’s working conditions at the transferor can be maintained. The transformation of a full- time contract into two or more part-time contracts may in some cases lead to a worsening of the employee's situation. The employee him-/herself might not agree with such fragmentation of his/her contract. For example, a part-time worker may not provide overtime according to Romanian legislation. As a result, an employee who has two part-time contracts cannot earn overtime income, while an employee who has a full-time contract may have this option.

4 Other Relevant Information Nothing to report.

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Slovakia

Summary Several acts and government decrees have been adopted, particularly in relation to COVID-19. Some new regulations have already addressed the need for personnel changes in the state administration. ______1 National Legislation 1.1 Measures to respond to COVID-19 crisis 1.1.1 Soldiers and public servants By Act No. 126/2020 Coll. amending Act No. 281/2015 Coll. on the civil service of professional soldiers and amending certain other acts, three acts have been amended:  Act No. 281/2015 Coll. on the civil service of professional soldiers, as amended;  Act No. 55/2017 Coll. on civil service, as amended and  Act No. 35/2019 Coll. on financial administration, as amended. The approved changes are related to COVID-19 but also to personnel changes in the state administration. Act No. 126/2020 Coll. entered into force on 21 May 2020.

1.1.1.1 Professional soldiers The purpose of Article I of Act No. 126/2020 Coll. amending Act No. 281/2015 Coll. on the civil service of professional soldiers is: 1. to increase the effectiveness of the selection procedure for the position of professional soldiers (Article 18); 2. to increase the age of children from 10 years to 11 years for the purpose of providing paid leave because a sick child requires treatment or to care for a child, thus harmonising the age of the child with the general legislation in Act No. 461/2003 Coll. on social insurance, as amended (Article 116 paragraph 2 letter a/ and b/); 3. to allow the release of a professional soldier even when an extraordinary situation, state of emergency or exceptional state in connection with COVID-19 has been declared due to non-submission to undergo an examination in connection with the performance of civil service, e.g. to detect the presence of alcohol or metabolites of narcotics or psychotropic substances in the body, by reason of a breach of an established restriction or prohibition, by reason of reaching the age limit or expiration of the period for which the professional soldier was granted a derogation from the age limit, by reason of meeting the conditions for entitlement to a retirement pension or by reason of imposing a disciplinary measure to reduce service salary (Article 235f paragraph 2 to 5); 4. to regulate the provision of service leave of a professional soldier due to the ordered quarantine (Article 235f paragraph 6 and 7); 5. to regulate the possibility of a professional soldier to perform service duties in a place other than his regular place of performance of civil service (Article 235f paragraph 8).

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1.1.1.2 Civil service The purpose of Article II of Act No. 126/2020 Coll. amending Act No. 55/2017 Coll. on civil service is primarily: 1. to remove the contradiction between Act No. 453/2003 Coll. on state administration bodies in the field of social affairs, family and employment services, as amended and Act No. 55/2017 Coll. on civil service, as amended as regards the civil service relationship of the director of the Office of Labour, Social Affairs and Family; 2. to change one of the qualification conditions for the performance of the function of the secretary-general of the Service Office, so that the current condition of three years of experience in public administration and three years of experience in management is replaced by five years of experience in management; 3. to delete paragraph 2 of Article 24, thus enabling service offices to respond more flexibly and quickly to the need for changes in their organisational structure caused by the need to adapt to the changing external environment; 4. to extend the calculation of legal titles for admission to temporary civil service to enable the service offices to strengthen their staffing capacity on a transitional basis if necessary, temporary civil service on the basis of a new legal title will last until the occupation of a vacant civil servant post, but a maximum of six months, at the same time a civil servant admitted to temporary civil service according to Article 36 paragraph 3 letter e/ will not be able to apply to the narrower internal selection procedure; 5. to unify the legal regulation of immediate termination of civil service with the legal regulation of immediate termination of employment relationships according to the Labour Code.

1.1.1.3 Financial administration Article III of Act No. 126/2020 Coll. amending Act No. 35/2019 Coll. on financial administration, as amended, provides as follows: 1. In Article 105, paragraph 5 reads: "(5) The Director of the Tax Office, Director of the Customs Office, Director of the Criminal Office Financial Administration, Deputy Director of the Tax Office, Deputy Director of the Customs Office and deputy director of the Criminal Office of Financial Administration is appointed and dismissed from their position by the President; they may be dismissed from office without a reason being provided."; 2. In Article 105 paragraph 6, the following sentence has been added at the end: "The Director-General of the section may be dismissed from office by the President without a reason being provided." (President of the Financial Administration)

1.1.2 Social insurance By Act No. 127/2020 Coll. amending Act No. 461/2003 Coll. on social insurance, as amended, and amending certain other acts, three acts have been amended. The approved changes are related to COVID-19; one immediate impact on labour law relations has been the amendment of Act No. 283/2202 Coll. on travel expense reimbursement. Act No. 127 /2020 Coll. has been in force since 21 May 2020.

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1.1.2.1 Travel expense reimbursement In Article II of Act No. 127/2020 Coll. amending Act No. 283/2002 Coll. on travel expense reimbursement, in view of the current situation, it is provided to not temporarily adjust the amounts of meal cost for the relevant time zones and the amounts of basic expenses for the use of road motor vehicles (until 31 December 2021). After Article 38f, a new Article 38g has been inserted, which, including the title, reads: Article 38g - Transitional provision in relation to the declaration of an extraordinary situation, state of emergency or exceptional state in relation to COVID-19: “The provisions of Article 8 shall apply until 31 December 2021."

1.1.3 Unemployment benefits The purpose of the Decree of the Government of the Slovak Republic No. 137/2020 Coll., amending the Decree of the Government of the Slovak Republic No. 101/2020 Coll. on the extension of the unemployment benefit period during an extraordinary situation, state of emergency or exceptional state declared in connection with COVID- 19 is that the unemployment benefit period, which was extended pursuant to Article 293et of Act No. 461/2003 Coll. on social insurance as amended by Act No. 66/2020 Coll. by one month and extended by another month by a government decree, has been extended by another month because of the ongoing crisis and the related negative consequences. Decree of the Government of the SR No. 137/2020 Coll. entered into force on 30 May 2020. In Article 1 of the Decree of the Government of the Slovak Republic No. 101/2020 Coll. a new paragraph 2 has been inserted after paragraph 1, which reads as follows: “ (2) The unemployment benefit period, which has been extended pursuant to paragraph 1 and which would have elapsed during an extraordinary situation, state of emergency or exceptional state declared in connection with COVID-19, shall be extended by one month; Article 293et paragraph 3 of the Act shall apply equally”. (Article 293et paragraph 3 of Act No. 461/2003 Coll. on social insurance: “For the purposes of Article 105 paragraph 4, the remaining part of the unemployment benefit period shall not include the extension of the unemployment benefit period pursuant to paragraph 1.”)

1.2 Other legislative developments Nothing to report.

2 Court Rulings Nothing to report.

3 Implications of CJEU Rulings and ECHR 3.1 Transfer of undertakings CJEU case C-298/18, Grafe und Pohle, 27 February 2020

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The main legal source is the Labour Code (Act No. 311/2001 Collection of Laws – “Coll”) as amended. The provisions of the Labour Code are binding for all employers in the private (business) sector and in the public sector. The issue is broadly regulated in the legal regulation of the ‘Transfer of rights and obligations resulting from labour law relations’ (Articles 27 – 31). According to Article 28 paragraph 1 of the Labour Code, if a business unit, which is an employer or a part of an employer for the purposes of this act or if a task or activity of an employer or part thereof is transferred to another employer, the rights and obligations arising from the relationships governed by labour law with the transferred employees shall be transferred to the transferee employer. The provision of Article 28 paragraph 2 of the Labour Code is also of relevance: “A transfer pursuant to paragraph 1 is the transfer of a business unit, which preserves its identity as an organised group of resources (tangible components, intangible components and personal components), whose purpose is to carry out an economic activity, regardless of whether this activity is primary or secondary.” The legislation, of course, does not go into such detail as the judgments of courts. Their assessments, in the event of a dispute, will depend on the competent court. However, given the number and content of the judgment of the CJEU, the question may arise whether it might not be useful to amend the Directive and subsequently the national legislation.

CJEU case C-344/18, ISS Facility Services, 26 March 2020 The main legal source in this regard is the Labour Code (Act No. 311/2001 Collection of Laws – “Coll”) as amended. The provisions of the Labour Code are binding for all employers in the private (business) sector and in the public sector. The issue is broadly regulated in the legal regulation of the ‘Transfer of rights and obligations resulting from labour law relations’ (Articles 27 – 31). According to Article 28 paragraph 1 of the Labour Code, if a business unit, which is an employer or a part of an employer for the purposes of this act or if a task or activity of an employer or part thereof is transferred to another employer, the rights and obligations arising from the relationships governed by labour law with the transferred employee shall be transferred to the transferee employer. Rights and obligations of the hitherto employer towards employees whose labour law relations ceased on the day of the transfer shall remain unaffected (Article 28 paragraph 5). According to Article 29a of the Labour Code, if a transfer results in significant changes of an employee’s working conditions and the employee does not agree with those changes, the employment relationship shall be deemed to have been terminated by agreement pursuant to Article 63 paragraph 1 letter b/ with effect from the date of the transfer. The employer shall issue a written document concerning the termination of the employment relationship to the employee pursuant to the first sentence. An employee who falls under the first sentence shall be entitled to severance pay pursuant to Article 76. As mentioned above, the legislation is not particularly detailed as the judgments of the courts. Their assessments, in the event of a dispute, will depend on the competent court. However, given the number and content of the judgments of the CJEU, the question may arise whether it would not be useful to amend the Directive and subsequently the national legislation.

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4 Other Relevant Information Nothing to report.

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Slovenia

Summary (I) On 14 May 2020, Slovenia declared the end of the COVID-19 epidemic with effect as of 31 May 2020. A gradual easing of epidemic-related measures has occurred. Formal revocation of the COVID-19 measures has had implications for employment relationships as well. (II) The Act Determining the Intervention Measures to Mitigate and Remedy the Consequences of the COVID-19 Epidemic (the so-called third mega package of COVID-19 measures) was passed by Parliament on 29 May 2020, published on 30 May 2020 and entered into force on 31 May 2020. ______1 National Legislation 1.1 Measures to respond to the COVID-19 crisis 1.1.1 Slovenia declared end of COVID-19 epidemic Slovenia was the first European country to declare the end of the COVID-19 epidemic. On 14 May 2020, the Government of the Republic of Slovenia adopted the Ordinance on the revocation of the measures in response to the epidemic contagious disease SARS- CoV-2 (COVID-19) (Odlok o preklicu epidemije nalezljive bolezni SARS-CoV-2 (COVID- 19), Official Journal of the Republic of Slovenia, No. 68/2020, 14 May 2020), which was followed by gradual easing of the Covid-19 related measures introduced to contain its spread. The Ordinance entered into force on 15 May 2020 and became effective on 31 May 2020. Many COVID-19 related measures have been lifted or loosened. Nevertheless, numerous measures still remain in force, as the risk of the spread of COVID-19 has not ended. The government has introduced new ordinances or has amended existing ones, thus adapting different measures to prevent the spread of COVID-19 (measures at the borders, quarantine rules, masks, social distancing, etc.) to the changing situation in the neighbouring and other countries as well as in Slovenia. The formal revocation of the COVID-19 epidemic has had implications in the field of labour law. Provisions in labour legislation that deal with exceptional circumstances, natural or other disasters were deemed to no longer apply. For example, Article 169 of the Employment Relationships Act (Zakon o delovnih razmerjih, Official Journal of the Republic of Slovenia, No. 21/2013, as later amended; ZDR-1), which stipulates that “in cases of natural or other disasters, or if such are expected, or in other exceptional circumstances when human life and health or the employer’s assets are endangered, the type of work or place of performing the work defined in the contract of employment may temporarily be changed, even without the worker’s consent, though only while such circumstances persist” was used from the onset of the epidemic as a legal basis to unilaterally order workers to work from home; such orders have been repealed and Article 169 of the Employment Relationships Act could no longer be used as a legal basis for home working. Nevertheless, home-/tele-/distant working is still widespread, wherever possible, but on a voluntary basis, upon agreement between the employer and the worker, and in accordance with the general labour law rules on home/teleworking (Articles 68 to 72 of the Employment Relationships Act). Certain temporary measures that were introduced to mitigate the epidemic’s negative consequences and epidemic-related measures on employment and social situation

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(described in previous Flash Reports) were only envisaged for the duration of the epidemic and ceased to apply with its formal ending (some measures have been extended or replaced with new ones in the so-called third mega package of COVID-19 measures – see below under 1.1.2). According to Articles 20 and 54 of the Act Determining the Intervention Measures to Contain the COVID-19 Epidemic and Mitigate its Consequences for Citizens and the Economy (Zakon o interventnih ukrepih za zajezitev epidemije COVID-19 in omilitev njenih posledic za državljane in gospodarstvo, ZIUZEOP; the so-called second mega package of COVID-19 measures, which entered into force in April), the provisions of that Act regulate temporary measures, which applied retroactively from 13 March 2020 until 31 May 2020 (with some exceptions), whereas in case the epidemic had not been revoked by 15 May 2020, these measures would have been automatically extended for another month, i.e. until the end of June 2020.

1.1.2 Third mega package of COVID-19 measures The Act Determining the Intervention Measures to Mitigate and Remedy the Consequences of the COVID-19 Epidemic was passed by Parliament on 29 May 2020; it was published on 30 May 2020 and entered into force on 31 May 2020 (Zakon o interventnih ukrepih za omilitev in odpravo posledic epidemije COVID-19, Official Journal of the Republic of Slovenia, No. 80/2020; hereinafter: ZIUOOPE). According to Article 10 of the ZIUOOPE, the temporary measures provided for by this Act shall apply from 01 June 2020 until 31 December 2020 (with some exceptions). The ZIUOOPE is a complex law regulating temporary intervention measures in the areas of employment and social issues, public finances, infrastructure, public procurement, scholarships, education, the economy in general and certain specific sectors, the most vulnerable sectors, such as for example tourism, agriculture, forestry, food and transport. The report focusses on measures in the area of labour law, the most important being the partial reimbursement of wage compensation for temporarily laid-off workers and the State subsidies in case of the short-time work scheme. (i) Wage compensations for temporarily laid-off workers The ZIUOOPE, the third COVID-19 mega package, extended (with some adjustments) the measure of reimbursement of wage compensation paid by employers to the temporarily laid-off workers due to the epidemic crisis until the end of June 2020 (initially foreseen only until the end of May 2020, see above under 1.1.1). This measure is regulated in Articles 24 to 34 of the ZIUOOPE. All employers in Slovenia who cannot provide work for their employees due to the consequences of the epidemic are, under the prescribed conditions, entitled to the reimbursement of wage compensation, whereby certain exceptions apply (it is not possible to receive this type of State aid if, for example, the employer is directly or indirectly financed by the State or municipal budget and the public revenue share was above 70 per cent in 2019, in case of unpaid taxes or social security contributions, or if the bankruptcy proceedings have been initiated against the employer). As a general rule, the employer is entitled to the reimbursement of wage compensations for the temporarily laid-off workers if, due to the epidemic crisis, the revenues in 2020 will be at least 10 per cent lower than in 2019. Subsidies are awarded on the basis of the employer’s assessment of this revenue; if it is established a posteriori, when annual reports for 2020 are submitted, that this condition of at least 10 per cent drop of the actual revenues in 2020 was not met, the employer will be required to return the amount received for the reimbursement of wage compensations paid to employees temporarily laid-off due to the COVID-19 crisis.

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Employers wishing to benefit from this measure must submit an online application to the Employment Service of Slovenia and enclose the statement indicating the estimated drop in revenues in 2020. The application must be submitted within eight days after laying-off the employees, but no later than on 30 June 2020. The Employment Service must make a decision within 15 days. Employers benefiting from this measure may not dismiss the respective employees and may not impose overtime work on other employees, if the work could be done by the laid-off employees. The temporarily laid-off workers are entitled to a wage compensation in the amount stipulated by the Employment Relationships Act in case of employers’ temporary inability to provide work for business reasons (ZDR-1, Article 138), i.e. 80 per cent of the salary, whereby the compensation may not be lower than the minimum salary in Slovenia (Article 27 of the ZIUOOPE). The State reimburses up to 80 per cent of the wage compensation actually paid to the employee; however, there is a ceiling that equals the maximum amount of unemployment benefit according to the Labour Market Regulation Act (EUR 892.50 gross). The remaining part of the costs for wage compensations paid to the laid-off employees is borne by the employer (20 per cent or more in case the ceiling applies). (ii) Short-time work scheme One of the key measures of the third COVID-19 mega package is the introduction of the subsidised short-time work scheme (Articles 11 to 23 of the ZIUOOPE). The ZIUOOPE offers a partial State subsidy to employers who introduce a short-time work scheme. The employers may receive State subsidies covering a certain proportion of the wage compensation for employees whose working time has been reduced due to the COVID-19 crisis for up to 50 per cent of their regular/full working time, i.e. for a maximum of 20 hours per week. Employers who cannot provide at least 10 per cent of their employees with 90 per cent of their normal working time, i.e. 36 hours of work per week, and consequently introduce a short-time work scheme in the company, meaning that their employees work less than their regular working time, but at least 20 hours per week, can apply for partial State subsidy (partial State subsidy may cover between 5 hours and 20 hours per week for an individual employee). Employees whose working time has been reduced due to lack of work are entitled (in addition to the proportion of their salary corresponding to their reduced working time, i.e. the time they actually work) to the wage compensation for the remaining time during which they are not working. Employers can apply for partial State subsidy monthly in the period from 01 June to 31 December 2020. The introduction of a short-time work scheme in the company must be based on a fruitful social dialogue. Before a decision on short-time work is adopted, the employer must inform the trade unions at the company and consult with them about all relevant issues of the short-time scheme, such as the scope of the measure, the number of employees affected and the expected duration of that measure. If no trade union exists in the company, the employer must organise consultations with the works council. Before introducing the short-time work scheme, the employer must obtain a written opinion of the trade unions/works council. Continuous social dialogue should take place. Employers are expected to apply for the partial State subsidy monthly, therefore, monthly consultations with trade unions/works councils seem to be appropriate. The ZIUOOPE explicitly stipulates (Article 12, paragraph 5 of the ZIUOOPE) that consultations with trade unions/works councils is necessary each time a relevant change in the circumstances affecting the short-time work scheme (in particular, if the scope of the short-time work scheme, the number of workers affected and/or the duration of the measure are to be changed). If there is no trade union nor works council at the

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company, the employer must inform the employees directly in the usual manner prior to the adoption of the decision on short-time work. The employer must apply for the subsidy at the Employment Service of Slovenia within 15 days after the introduction of a short-time work scheme in the company and the Employment Service of Slovenia must issue a decision within 15 days. If the subsidy is granted, the employer concludes a special agreement with the Employment Service of Slovenia specifying all the details of this measure, in particular, mutual obligations and responsibilities of the contracting parties, the amount, method of payment of the subsidy, conditions and method of refund of the subsidy, time of receipt of the subsidy, monitoring, reporting, sanctions for infringements and supervision of implementation of the agreement. One of the most important commitments on the part of the employer who benefits from this measure is that the employer shall not dismiss employees covered by the short- time work scheme on economic grounds during the period of collecting the State subsidy and in the month following the expiry of the measure. In addition, the employer is not allowed to impose overtime work on other employees, if the work could be performed by the employees covered by the short-time work scheme. The amounts of the subsidies are as follows:  EUR 448 per month per employee if the reduced working time is between 20 to 24 hours per week;  EUR 336 per month per employee if the reduced working time is between 25 to 29 hours per week;  EUR 224 per month per employee if the reduced working time is between 30 to 34 hours per week;  EUR 112 per month per employee if the reduced working time is 35 hours per week. Detailed provisions regulate the supervision and inspection, sanctions, different restrictions as well transparency, publication of data, reporting, etc. In the announcement of this measure, the Minister of Labour explained that “with this measure, the government aims to encourage businesses to restart their production processes and thus help flatten the unemployment curve”.

1.2 Other legislative developments Nothing to report.

2 Court Rulings Nothing to report.

3 Implications of CJEU Rulings and ECHR 3.1 Transfer of undertakings CJEU case C-298/18, Grafe und Pohle, 27 February 2020 The CJEU case C-298/18 (Grafe and Pohle), which deals with the issue of the definition of the transfer of an undertaking and further clarifies this concept and criteria to be taken into account when assessing whether the transfer of an undertaking in the

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meaning of the Directive 2001/23 took place or not is of relevance for the Slovenian legal order. Directive 2001/23 has essentially been transposed into the Slovenian legal order by the Employment Relationships Act (Zakon o delovnih razmerjih, Official Journal No. 21/2013, as later amended – ZDR-1), in particular by its provisions of Article 75, paragraphs 1 to 8, and Article 76. Both the Slovenian legislation and the relevant Slovenian case law follow a broad concept of the transfer of an undertaking as has been defined in the Directive and further developed by the case law of the CJEU. According to Article 75, paragraph 1 of the Employment Relationships Act, the change of employer (transfer) can occur in the form of a legal transfer of (part of) an undertaking/business, executed on the basis of a law, any other regulation, contractual transaction, final court decision, merger or division. However, there is no specific provision in the Slovenian legislation which defines the meaning of ‘transfer of an undertaking’ and in particular, the meaning of the ‘retention of identity of an economic entity’. There are also no specific provisions in the Slovenian legislation which would specify the criteria to be used when assessing whether the transfer of undertaking took place or not. Therefore, the CJEU case law has significantly influenced the meaning of a transfer in the Slovenian legal order and in Slovenian case law (see, for example, Senčur Peček, D., Aktualna vprašanja spremembe delodajalca [Current Issues Regarding Transfers of Undertakings], Delavci in Delodajalci, 2010, Vol. 10, No. 2-3, 300-301). The Commentary on the Employment Relationships Act emphasises that when interpreting and applying the relevant provisions of this act regulating safeguards of employees in the event of a transfer, Directive 2001/23/EC as well as the relevant CJEU case law must be taken into account (Končar, P., Komentar k 73. členu [Commentary on Article 73], V: več avtorjev, Zakon o delovnih razmerjih s komentarjem, : GV 2008, 330; Senčur Peček, D., Komentar k 75. členu [Commentary on Article 75], V: več avtorjev, Zakon o delovnih razmerjih s komentarjem, Ljubljana: GV 2019, 454- 456). When deciding transfer cases, Slovenian labour courts strongly depend on the (ever- developing) case law of the CJEU. It can be said that every new CJEU judgment in this respect shapes the Slovenian case law on transfers of undertakings and that it is just a matter of time for it to be reflected in judgments of the Slovenian court. There are many examples of Slovenian courts interpreting the concept of ‘transfer’ and in particular the meaning of ‘retention of identity of an economic entity’— in the absence of more precise legal provisions in the Slovenian legislation—rely on and follow the relevant case law of the CJEU (see, for example, judgments of the Supreme Court No. VIII Ips 342/2017, ECLI:SI:VSRS:2019:VIII.IPS.342.2017; No VIII Ips 273/2015, ECLI:SI:VSRS:2016:VIII.IPS.273.2015; No. VIII Ips 178/2006, ECLI:SI:VSRS:2006:VIII.IPS.178.2006; judgment of the Higher Labour and Social Court, No. Pdp 68/2015, ECLI:SI:VSRS:2015:PDP.68.2015; and many others). CJEU judgment C-298/18 addresses a specific situation in which a local public bus transport service has been taken over by another company as a result of a public tender procedure (whereby the new operator of the public bus transport service has recruited the majority of bus drivers and management staff of the previous operator, but—due to the stricter legal, environmental and technical requirements as regards the buses and other equipment, imposed by the contracting authority—has not taken over the operational resources, including buses and similar). Such a situation has not yet been addressed by Slovenian case law. The referring court, in essence, asked whether in the context of a takeover by an economic entity of an activity under a procedure for the awarding of a public contract, the fact that that entity has not taken over the operational resources owned by the economic entity, which was previously engaged in that activity, precludes the classification of that transaction as a transfer of an undertaking. The company that

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previously operated the local public bus transport, the SBN, decided not to participate in a new call for tender, ceased its operations and dismissed all employees, among them Mr Grafe and Mr Pohle. The OSL, a wholly owned subsidiary of the company that was awarded the contract for the public bus transport services, recruited the majority of SBN’s drivers and management staff. Mr Grafe was employed as a bus driver by the OSL, but his previous periods of employment and the continuity of his employment relationship were not recognised by the OSL. Mr Pohle was not recruited by the OSL. The question arose whether in this context, a transfer of an undertaking had taken place in the meaning of Directive 2001/23 or not. The OSL argued that the approach adopted in the CJEU judgment Liikenne (C 172/99) should be relevant in this case: since the operating resources, including buses, have not been taken over by the OSL, there could be no transfer. On the other hand, the SBN emphasised that taking over the buses and other tangible assets by the OSL was precluded, given the stricter technical and environmental standards in force and therefore, other aspects had to be taken into account, namely that the bus drivers constituted a ‘scarce resource’ in rural areas and that their know-how and knowledge of the network made SBN’s bus drivers operational, thus ensuring the continuity of public transport service in the district. SBN inferred from this that the drivers should be seen as vital to the economic entity and that a transfer in the meaning of Directive 2001/23/EC had therefore taken place. The CJEU found that the fact that the entity (the OSL) had not taken over the tangible resources, which were the property of the economic entity previously engaged in that activity (the SBN), on account of legal, environmental and technical constraints imposed by the contracting authority, did not necessarily preclude the classification of that takeover of activity as a transfer of an undertaking, since other factual circumstances, such as the taking over of the majority of employees and the pursuit, without interruption, of that activity, make it possible to establish that the identity of the economic entity concerned has been retained, this being a matter for the referring court to assess. It can be expected that this CJEU judgment will have an impact on the further development of Slovenian case law. The Slovenian courts have in the past referred to the Liikenne case (for example, in the judgments of the Supreme Court, No. VIII Ips 273/2015, ECLI:SI:VSRS:2016:VIII.IPS.273.2015; No. VIII Ips 432/2009, ECLI:SI:VSRS:2010:VIII.IPS.28.2009; and the judgments of the Higher Labour and Social Court, No. Pdp 770/2015, ECLI:SI:VDSS:2016:PDP.770.2015; No. Pdp 68/2015 ECLI:SI:VDSS:2015:PDP.68.2015; Pdp 88/2017, ECLI:SI:VDSS:2017:PDP.88.2017; No. Pdp 1084/2016, ECLI:SI:VDSS:2017:PDP.1084.2016); therefore, they are expected and will have to take into account the new judgment C-298/18, which further develops and more precisely specifies the criteria from the Liikenne judgment. There are no obstacles in the Slovenian legislation and in existing case law on transfers of undertakings, which would prevent Slovenian legal rules on transfers to be interpreted and applied in line with this judgment.

CJEU case C-344/18, ISS Facility Services, 26 March 2020 This CJEU judgment, which also deals with the definition of a transfer, is of relevance for the Slovenian legal order as well. It addresses an interesting situation in which a transfer involves not just one transferor and one transferee, but rather a number of transferees. The CJEU found that in such situations, the rights and obligations arising from a contract of employment are transferred to each of the transferees in proportion to the tasks performed by the worker concerned, provided that the division of the contract of employment as a result of the transfer is possible and neither causes a deterioration of working conditions nor

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adversely affects the safeguarding of the rights of workers guaranteed by that Directive, which is for the referring court to determine. It further pointed out that if such a division were to be impossible to carry out or would adversely affect the rights of that worker, the transferee(s) would be regarded as being responsible for any consequent termination of the employment relationship under Article 4 of that Directive, even if that termination were to be initiated by the worker. Such a solution results in a situation in which an employee ends up with more than one contract of employment and more than one employer. A full-time contract of employment is divided into a number of (proportionate) contracts of employment for part-time work, which in total amount to full-time work, corresponding to the employment relationship with the previous employer, the transferor. The Slovenian legislation does not explicitly regulate the respective situation. Article 75, paragraph 1 of the Employment Relationships Act provides for the transfer of rights and obligations relating to the terms and conditions of employment, i.e. arising from the contract of employment on the day of the transfer, from the transferor (i.e. previous employer) to the transferee (i.e. new employer). Neither this nor any other provision specifically addresses the situation of transfers involving more than one transferee; Article 75, paragraph 1 speaks of a transferee. However, the provision, in combination with other provisions of the Employment Relationships Act, can be interpreted and applied in line with the CJEU judgment. Part-time contracts of employment are regulated by the Employment Relationships Act (Articles 65 to 67). According to Article 66, paragraph 1, part-time employment contracts may be concluded with several employers to achieve the full working time (in Slovenia, 40 hours per week). According to Article 65, paragraph 3, a part-time worker shall have the same contractual and other rights and obligations arising from the employment relationship as a worker who works full time, and shall exercise these rights and obligations proportionately to the time for which the employment relationship was concluded. In case of more employers, the part-time worker and the employers must reach an agreement on the working time (coordination of the distribution of working time in a manner that the worker is able to work for each of the employers concerned), on the manner of taking annual leave and on other absences from work. Employers employing a part-time worker shall be required to ensure that the worker can use the annual leave and other absences from work at the same time, unless this would cause damage to the employers (Article 66, paragraphs 2, 3, and 4 of the Employment Relationships Act). National courts have a difficult task when assessing whether such a division of one full- time contract of employment into several part-time contracts of employment is actually possible in a concrete situation and whether such a division results in a deterioration of working conditions or adversely affects the safeguarding of the rights of the worker. If this is the case, Article 75, paragraph 3 of the Employment Relationships Act is relevant which transposes Article 4 of Directive 2001/23/EC. This provision stipulates that if within a period of two years from the date of transfer, the rights under the employment contract deteriorate for objective reasons at the transferee’s premises or the employee’s working conditions at the transferee’s premises significantly change and the employee therefore terminates the employment contract, the employee has the same rights as if the employment contract had been terminated by the employer for business reasons. In determining the period of notice, the amount of severance pay and all other rights relating to years of service, the periods of service with both employers must be taken into account. If a deterioration of working conditions occurs when the transfer takes place, and the employee rejects the transfer because of it, this provision applies as well. Slovenian rules are in line with the judgment in this respect since the transferee(s) would be regarded as being responsible for any consequent termination of the employment relationship, even if that termination were to be initiated by the worker.

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A situation of dividing a full-time employment contract into several part-time contracts of employment as a result of a transfer has not yet been addressed before the Slovenian labour courts and there is no case law in this respect. However, it can be expected that the CJEU judgment in case ISS Facility Services will have an impact on the further development of Slovenian case law when such a case is brought before the Slovenian labour court. As already pointed out above, under Grafe and Pohle, the Slovenian labour courts depend strongly on the (ever-developing) case law of the CJEU when deciding transfer cases and frequently refer to CJEU judgments. Therefore, the Slovenian courts are expected and will have to take into account the new judgment C-344/18. There are no obstacles in Slovenian legislation and the existing case law on transfers of undertakings which would prevent Slovenian legal rules on transfers to be interpreted and applied in line with this judgment.

4 Other Relevant Information Nothing to report.

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Spain

Summary The government has declared a state of emergency to prevent the spread of COVID- 19. On 14 March, the government decided to lock down the country for 15 days, which has continued to be extended and will end on 21 June. The government has approved various measures to deal with the situation, some of which are aimed at minimizing the impact on employment relationships. The de-escalation process has been in place for several weeks now and will lead to a so-called ‘new normality’, because many restrictions for social life (and even work) will continue to be in place until a cure for COVID-19 is found.

______1 National Legislation 1.1 Measures to respond to COVID-19 crisis 1.1.1 General overview: de-escalation Spain continues to be in a state of emergency. The last extension will end on 21 June (Royal Decree 555/2020, 05 June) and it seems that it will be the last extension. The so-called ‘de-escalation’ of the extraordinary situation caused by COVID-19 began on 04 May. The government announced that this ‘de-escalation’ would consist of four stages, but they would not start and end at the same time in the entire Spanish territory. The impact of the virus and the health system capabilities are key for the decision to move from one phase to another.  The first phase, with a minimum duration of one week, is ‘Phase 0’ due to its preparatory purpose, and it began on 04 May. The lockdown was eased and people were allowed to walk and do sports in specific time slots. Small shops were allowed to open but with enhanced health and safety measures. Some businesses, such as hair salons, could resume their activity, but clients must request a prior appointment (Orden SND/388/2020, 03 May);  ‘Phase 1’ (initial phase) started on 11 May in some areas. Restaurants and bars were allowed to open their terraces, but they had to adhere to capacity limitations (no more than 50 per cent of full capacity) and to new health and security protocols. Phase 1 started on 04 May in some Balearic and Canary (Formentera, la Gomera, el Hierro y la Graciosa, Orden SND/386/2020, 03 May) and on 11 May in most other regions. However, telework is still the preferred option to perform work in all phases of de-escalation and even thereafter (Article 3 of Orden SND/399/2020, 09 May);  During ‘Phase 2’ (intermediate phase) malls, cinemas and theatres were allowed to open. Restaurants and bars opened with capacity limitations (not only terraces, as in Phase 1). Phase 2 started on 18 May in some Balearic and Canary islands (Formentera, la Gomera, el Hierro y la Graciosa, Orden SND/414/2020, 16 May) and on 25 May in the majority of regions. and Barcelona, which were more severely affected by COVID, remained in Phase 0 until 25 May and then entered Phase 1. The restrictions were not so tight in municipalities with less than 10 000 inhabitants (Orden SND/427/2020, 21 May);  During ‘Phase 3’ (advanced stage) capacity limitations are less rigid and all businesses are allowed to be open (e.g. gyms), although in some regions, discotheques and pubs must remain closed for now. This phase started on 01 June in some Balearic and Canary islands (Formentera, la Gomera, el Hierro y la

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Graciosa, Orden SND/458/2020, 30 May) and on 08 June for many other regions, almost half of the Spanish territory (Orden/SND/507/2020, 06 June). Madrid and Barcelona have not yet entered Phase 3. The return to work must be safe, so new security measures have been introduced, such as ‘social distancing’ or improved hygiene standards (Articles 4 ff. of Orden SND/399/2020, 09 May). In the transition towards the ‘new normality’, the return to on-site work is beginning to be adopted in various sectors, such as vocational training (Resolution by the Public Employment Service, 01 June). After the state of emergency, a ‘new normal’ will begin until a cure for COVID-19 is found. This ‘new normality’ will require enhanced hygiene standards, the use of masks, social distancing and new behaviour to minimise risks. This new normal will affect employment relationships because employers are required to adopt new measures to reduce their workers’ risk of exposure to COVID (as well as their clients). New regulations have been passed for that purpose.

1.1.2 Transport sector Passenger transport undertakings must provide masks and hydro-alcoholic products to their workers, since these workers will be required to wash their hands more frequently (Orden TMA/384/2020, 03 May). Security measures will be more severe to protect workers and users from the virus.

1.1.3 Court staff The progressive increase in activity due to the de-escalation has led to the return of many workers to their jobs. However, the conditions of this return differ from the previous ones, because new security measures must be respected, such as ‘social distancing’ or improved hygiene standards. These are specific measures for court staff. The return to work must follow a predefined plan, which consists of several phases. Phase 2 of that plan started on 24 May (Orden JUS/430/2020, 22 May) and Phase 3 began on 07 June (Orden JUS/504/2020, 05 June). Orden JUS/394/2020 of 08 May, which comprises the work safety programme and the de-escalation programme for court staff, is available here.

1.1.4 Temporary lay-offs Temporary lay-offs will not end when the state of emergency is over, but their effects, including reductions of employer contributions to social security, will last until 30 June (Royal Decree 18/2020, 12 May). In this new context, temporary lay-offs could affect the entire staff or only part thereof once the undertaking can resume its activity, but not at full capacity. This extension of effects has three conditions:  Undertakings with fiscal residence in a tax haven are excluded;  Undertakings with more than 50 workers cannot pay dividends;  The prohibition of dismissals for six months continues to be in force, but it is not applicable to undertakings with a risk of entering into an arrangement with creditors. There are ongoing negotiations between the government, unions and employer organisations to extend these measures beyond June.

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1.1.5 Employment The regions have started providing financial aid to promote employment. These regional measures have been followed by the State, which has also provided support for employment plans. There are measures that apply to the entire Spanish territory (Orden TES/406/2020, 07 May) and others to specific regions (e.g. Cataluña, Decree 16/2020, 05 May)

1.1.6 Financial support for people with low incomes and self-employed workers Some regions continue to provide financial aid to people with low incomes and to self- employed workers due to the temporary closure of their business. Many regions are providing economic support for , as reported in the previous Flash Report (e.g. Baleares, Decree 4/2020, 20 March or Cataluña, Decree 14/2020, 28 April and Decree 21/2020, 02 June). All of these regulations are included in a ‘Code’ that is updated daily which can be consulted free of charge on the Official Gazette website.

1.1.7 Work of foreigners The lockdown has had a significant impact on foreigners, because work permits could not be renewed, even if they expired. This limitation has put these workers in a situation of uncertainty. The government has decided to extend work permits for foreigners if these expire during the state of emergency (Orden SND/421/2020, 18 May). This extension will last for six months after the end of this exceptional situation. The alien identity cards of EU citizens and the residence cards of family members of a Union citizen are entitled to the same extension. This is consistent with the freedom of movement and with the guidelines provided for by the Commission during the COVID- 19 crisis.

1.1.8 Freedom of movement The government has introduced major restrictions on the freedom of movement (Orden SND/439/2020, 23 May). In particular, border controls are tighter and also affect EU citizens. As a general rule, entry into Spain is not allowed. The aforementioned limitation has exceptions, and some of them are related to work. In particular, the entry into Spain is allowed for frontline workers and health staff to perform work. These measures have been extended until the end of the state of emergency (Orden SND/521/2020, 13 June).

1.1.9 Unemployment benefits Article 2 of Royal Decree 17/2020 introduces temporary unemployment benefits for artists. The suspension of all cultural activities has had a huge impact in this sector. Not all artists are affected by temporary lay-offs, so those who are excluded cannot, as a general rule, enjoy unemployment benefits.

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The government continues to extend unemployment benefits (in an extraordinary way) to deal with the consequences of the lockdown.

1.1.10 Employment in the agricultural sector The extraordinary measures to boost employment in the agricultural sector have been extended until 30 September 2020 (Royal Decree 19/2020, 26 May). Moreover, young foreigners between the ages of 18 and 21, who have worked in the agricultural sector in accordance with these provisions will receive a two-year residence permit, renewable for another two years. To deal with this situation, the government has approved measures to make the recruitment of fixed-term workers in the agricultural sector easier. Due to these flexibility measures (extraordinary, according to this provision), wages obtained for fixed-term work in agriculture during this period are compatible with unemployment benefits and other social assistance. These measures were now extended, regardless whether the state of emergency ends, because the problem will not disappear immediately.

1.1.11 COVID-19 and health care staff Contracting COVID-19 will be considered an accident at work for health care staff, even if it occurs in the month after the end of the state of emergency (Royal Decree 19/2020, 26 May)

1.1.12 Minimum living income The government has created a new social security benefit called ‘minimum living income’, aimed at preventing the risk of poverty and social exclusion of people when they find themselves in a vulnerable situation due to the lack of sufficient economic resources to cover their basic needs (Royal Decree 20/2020, 29 May). It is a new non- contributory social security benefit and configured as the subjective right to an economic payment for ensuring a minimum level of income to those who are in a situation of economic vulnerability. The new minimum living income is not a temporary and merely conjunctural social protection instrument, but one that has already been added to the list of social security benefits that will remain for the future. It is applied in the form of a monthly payment, which is a supplement to the beneficiaries’ own income. Minimum income covers the difference between the beneficiaries’ own income and the sum established as being the minimum living threshold and total amount (as a maximum) of the minimum income benefit. This amount of the minimum income and threshold for access to the benefits is calculated by taking non-contributory old-age and invalidity as a starting point. Following these rules, the amount initially established for the year 2020 is EUR 461.50 monthly for an adult living alone (EUR 5 538 annually). For those who live in a multi- person household, the amount is higher, depending on the number of persons who live in that household and on their specific circumstances, namely up to EUR 1 015 monthly for a household of five members. Single-parent households receive an additional payment. The amounts will be periodically updated.

1.2 Other legislative developments Nothing to report.

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2 Court Rulings Nothing to report.

3 Implications of CJEU Rulings and ECHR 3.1 Transfer of undertakings CJEU case C-298/18, Grafe und Pohle, 27 February 2020 According to CJEU Grafe (27 February 2020, case C–298/18), “Article 1(1) of Council Directive 2001/23/EC of 12 March 2001 on the approximation of the laws of the Member States relating to the safeguarding of employees’ rights in the event of transfers of undertakings, businesses or parts of undertakings or businesses must be interpreted as meaning that, in the context of the takeover by an economic entity of an activity the pursuit of which requires substantial operating resources, under a procedure for the award of a public contract, the fact that that entity does not take over those resources, which are the property of the economic entity previously engaged in that activity, on account of legal, environmental and technical constraints imposed by the contracting authority, cannot necessarily preclude the classification of that takeover of activity as a transfer of an undertaking, since other factual circumstances, such as the taking‑over of the majority of the employees and the pursuit, without interruption, of that activity, make it possible to establish that the identity of the economic entity concerned has been retained, this being a matter for the referring court to assess.” The Supreme Court has numerous judgments on the application of the rules of transfers of undertakings when the contractor terminates the activity and is replaced by a new contractor. Transfers of undertakings are not automatic, and require either a transfer of assets or a succession of staff. This is the standard situation in Spain.

CJEU case C-344/18, ISS Facility Services, 26 March 2020 According to the CJEU, ISS Facility Services NV (26 March 2020, case C-344/18), “where there is a transfer of undertaking involving a number of transferees, Article 3(1) of Council Directive 2001/23/EC of 12 March 2001 on the approximation of the laws of the Member States relating to the safeguarding of employees’ rights in the event of transfers of undertakings, businesses or parts of undertakings or businesses must be interpreted as meaning that the rights and obligations arising from a contract of employment are transferred to each of the transferees, in proportion to the tasks performed by the worker concerned, provided that the division of the contract of employment as a result of the transfer is possible and neither causes a worsening of working conditions nor adversely affects the safeguarding of the rights of workers guaranteed by that directive, which it is for the referring court to determine. If such a division were to be impossible to carry out or would adversely affect the rights of that worker, the transferee(s) would be regarded as being responsible for any consequent termination of the employment relationship, under Article 4 of that Directive, even if that termination were to be initiated by the worker.” In Spain, collective bargaining for some sectors, mainly the cleaning sector, requires the new contractor/transferee to succeed the employment contracts of those workers that are already performing the job, so a transfer of an undertaking involving a number of transferees does not cause a problem of interpretation. The worker has the right to

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keep the job in the same workplace as before, even if there are different new employers for each of them. However, this rule is not common for other sectors. Therefore, the key issue is not addressed in Spanish law by a provision of general scope and there is no case law about it. In this context, it is unclear how Spanish courts would have dealt with it.

4 Other Relevant Information 4.1 Unemployment Unemployment increased in May by 26,573 people, and there are already 3,857,776 unemployed people.

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Sweden

Summary The Swedish government has received a controversial public enquiry on the Employment Protection Act. The legislative proposals of the enquiry suggest some significant changes to the selection criteria for dismissal and to the procedures in dismissals for personal reasons. ______1 National Legislation 1.1 Measures to respond to COVID-19 crisis Nothing to report.

1.2 Other legislative developments 1.2.1 Dismissal protection The Swedish has received a public enquiry, SOU 2020:30, which was initiated as a result of parliamentary support from two parties of the liberal- conservative opposition. The enquiry, chaired by one of the most prominent legal experts in the country, includes proposals on how to ease the statutory redundancy provisions, giving the employer the option to exclude five employees prior to applying the last-in-first-out selection principle. The current legislation only allows small enterprises (less than ten employees) to exclude two employees. The last-in-first-out selection provision (Section 22 Employment Protection Act) can be modified or completely disposed by collective agreement, which is very commonly the case. The Social Democrat – government coalition and the workers trade unions have reacted very negatively to the proposals and the prospects of these proposals are very uncertain.

2 Court Rulings Nothing to report.

3 Implications of CJEU Rulings and ECHR 3.1 Transfer of undertakings CJEU case C-344/18, ISS Facility Services, 26 March 2020 The CJEU has ruled on a transfer of an undertaking in case C-344/18. The Court concluded that the Directive on Transfers of Undertakings could apply in a situation where the employment content of the contract was only partly transferred to the (main) new employer while other parts of the employment content were transferred to another. The Court found that the Directive also covers such situations. From a Swedish perspective, this seems uncontroversial, even though, to the author’s knowledge, there is no case law on part-time or partial transfers. The Swedish labour law accepts “slicing” of employment, with reduced work percentages, under the application of the procedures in the Employment Protection Act (the future of this regime is highly debated from the trade unions). The most likely outcome of a similar case as C-344/18, which could represent a “sliced” employment contract, would be to find, as the CJEU did, that it

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would be considered a transfer of an undertaking, and that the new employer would then be able to slice the employment from 100 per cent to 85 per cent as in C-344/18.

CJEU case C-298/18, Grafe und Pohle, 27 February 2020 In case C-298/18, also involving a transfer of an undertaking, the CJEU concluded that the “takeover by an economic entity of an activity the pursuit of which requires substantial operating resources, under a procedure for the award of a public contract, the fact that that entity does not take over those resources, which are the property of the economic entity previously engaged in that activity, on account of legal environmental and technical constraints imposed by the contracting authority, cannot necessarily preclude the classification of that takeover of activity as a transfer of an undertaking, since other factual circumstances, such as the taking-over of the majority of the employees, and the pursuit, without interruption, of that activity”. The case seems to reinforce an overall multi-factor perspective of what constitutes a transfer of an undertaking, previously adopted by the CJEU and reinforced by the Swedish Labour Court (AD 2010 No. 25, AD 2008 No. 64). The CJEU conclusion that the national courts, with respect to the material aspects of the cases, will have to, in casu, examine the circumstances as in the current case, is well-established with the Swedish Labour Court.

4 Other Relevant Information Nothing to report.

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United Kingdom

Summary COVID-19 legislation has been supplemented with new documents on the Self- Employment Income Support Scheme, the Job Retention Scheme, and Holiday entitlement and pay. ______1 National Legislation 1.1 Measures to respond to COVID-19 crisis 1.1.1 Key documents  The relevant government web page;  Specific advice for employees, employers and businesses;  Guidance on social distancing;  People in Scotland, Wales and have to follow the specific rules in those parts of the UK.

1.1.2 New documents (i) Self-Employment Income Support Scheme There is guidance on the equivalent of furlough for the self-employed (SISS). The direction by the treasury is available here and public information is available here. The scheme will allow an individual to claim a taxable grant of 80 per cent of their average monthly trading profits, paid out in a single instalment covering 3 months, and capped at GBP 7 500 altogether. This is a temporary scheme, but it may be extended. (ii) Job Retention Scheme The furlough scheme for employees is now up and running. The direction by the treasury is available here and additional public information is available here (latest update 12 June 2020). The direction takes precedence over the guidance issued by HMRCA. A helpful summary of the changes has been published by Simmon & Simmons and is available here. The scheme will run until 31 October 2020. From August 2020, employees will be able to return to work on a part-time basis and employers will be required to continue to pay the salaries of the furloughed workers. (iii) Holiday entitlement and pay New guidance on holiday entitlement and pay is available here.

1.2 Other legislative developments Nothing to report.

2 Court Rulings Nothing to report.

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3 Implications of CJEU Rulings and ECHR 3.1 Transfer of undertakings CJEU case C-298/18, Grafe und Pohle, 27 February 2020 This case concerns an interpretation of Article 1(1) on a transfer of an undertaking in the case of what, at first sight, appears to be an assets-based transfer. In the UK, the Directive has been implemented by the Transfer of Undertakings (Protection of Employment) Regulations 2006 and the implementation goes further than the Directive because it covers ‘Service provision change’ (hereinafter: SPC) (Regulation 3(1)(b)). If the transfer falls within the definition of SPC, then it is automatically a transfer of an undertaking as it would be in this case. This case does not therefore affect the law in the UK.

CJEU case C-344/18, ISS Facility Services, 26 March 2020 This case concerns the division of tasks between transferees. The Court ruled that the rights and obligations arising from a contract of employment are transferred to each of the transferees in proportion to the tasks performed by the worker concerned, provided that the division of the contract of employment as a result of the transfer is possible and neither causes a deterioration of working conditions nor adversely affects the safeguarding of the rights of workers guaranteed by that Directive, which it is for the referring court to determine. If such a division were to be impossible to carry out or would adversely affect the rights of that worker, the transferee(s) would be regarded as being responsible for any consequent termination of the employment relationship, under Article 4 of that Directive, even if that termination were to be initiated by the worker. This is a clarification of the law and would inform the interpretation of the relevant provisions of the UK regulation

4 Other Relevant Information Nothing to report.

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