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The European Court of Justice: Employers must keep track of their employees’ working hours (Denmark)

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Legal news
calendar 29 May 2019
globus Denmark

In a recent ruling, the European Court of Justice declared that all employers must, in principle, have a system in place to record the actual daily working hours of their staff. According to the Court, it is necessary for employers to ensure that EU rules on maximum working hours are being followed. The ruling is far-reaching and will likely result in amendments being made to Danish law.

The case revolved around a trade union in Spain. The union alleged that a bank was, under Spanish law, required to establish a system to track and record the actual, daily working hours of its staff. The system that the bank had in place was only able to record entire days of absence; e.g. holidays or sick leave. The case was brought before a Spanish court which found that the bank did not have a system that made it possible to effectively keep track of staff working hours. They also found that the bank had ignored an order from the Spanish labour inspectorate to introduce such a system.

The court also found, however, that Spanish case law only required the employer to introduce a system to record overtime worked by employees. The court was therefore in doubt as to whether or not the situation in Spain was in violation of EU law, given that employers in Spain were not obligated to establish their own systems to record all daily hours worked by their staff. According to the court, this meant that employees were not properly able to demonstrate whether or not their working time exceeded the limits for daily and weekly working hours established by EU law.

It therefore fell to the ECJ to determine whether or not it was in line with EU law that Spanish law, as it was interpreted by the Spanish courts, did not require employers to establish a system for the registration of all working hours for the individual staff members within their organisations.

Systems that record working hours are necessary in order to effectively protect employees

The ECJ ruled that staff working hours are primarily governed by the Working Time Directive and by the EU Charter of Fundamental Rights. These legal documents establish rules regarding daily and weekly periods of rest, and they establish maximum limits for weekly working time. The Court noted that member states are obligated to adopt the measures needed to effectively safeguard employee rights, but that EU law does not impose any specific or concrete requirements as to the precise ways in which these rights should be safeguarded in practice.

The Court found that, realistically, it is impossible to determine actual staff working hours and overtime hours in an objective and reliable way in the absence of a system that can be used to measure and record the individual daily hours worked by each employee. According to the Court, it is therefore unreasonably difficult or practically impossible for employees to enforce their rights on the limitations regarding working time in accordance with EU law.

On this basis, the Court found that member states are obliged to ensure that employers establish objective, reliable and accessible systems that can be used to measure the length of each individual employee’s daily working time. According to the Court, such a system can be used to ensure that employees have an effective way to protect their rights while also making it easier for employees to document their case in the event that their rights are violated. During the case, the Spanish government argued that a requirement for employers to introduce such a system for the recording and tracking of daily staff working hours would entail huge costs on the part of employers, but the court found that the need to protect the safety and health of employees weighed more heavily than such financial considerations.

The Court therefore ruled that it is a violation of EU law if member states do not oblige employers to establish a system for the tracking of individual employee working hours. The Court also noted, however, that it is up to each individual member state to determine the precise rules that should apply to these working hour recording systems, including whether or not special rules should apply for certain sectors or companies of a certain size.

IUNO’s opinion

The ruling is very far-reaching, as it states that all member states require employers to record their employees' actual daily working hours. This will entail a considerable financial and administrative burden for companies.

It is currently unclear exactly how Danish law will be amended in light of the ruling, but it is likely that an amendment to the Working Environment Act will be proposed in the new parliamentary session. Sweden and Norway, on the other hand, already have such rules in place, although perhaps not as far-reaching as may be required under the EU rules. Companies in Sweden are required to record overtime and on-call time and companies in Norway are required to keep a written and continuous overview of the actual daily working hours. In both Sweden and Norway, employees in independent or managerial positions are exempted.

IUNO recommends that companies already now prepare for when they will have to record the daily working hours of all employees. We will be closely following the implementation of this ruling and will report back when there are new developments.

[European Court of Justice ruling of 14 May 2019 in case C-55/18]

The case revolved around a trade union in Spain. The union alleged that a bank was, under Spanish law, required to establish a system to track and record the actual, daily working hours of its staff. The system that the bank had in place was only able to record entire days of absence; e.g. holidays or sick leave. The case was brought before a Spanish court which found that the bank did not have a system that made it possible to effectively keep track of staff working hours. They also found that the bank had ignored an order from the Spanish labour inspectorate to introduce such a system.

The court also found, however, that Spanish case law only required the employer to introduce a system to record overtime worked by employees. The court was therefore in doubt as to whether or not the situation in Spain was in violation of EU law, given that employers in Spain were not obligated to establish their own systems to record all daily hours worked by their staff. According to the court, this meant that employees were not properly able to demonstrate whether or not their working time exceeded the limits for daily and weekly working hours established by EU law.

It therefore fell to the ECJ to determine whether or not it was in line with EU law that Spanish law, as it was interpreted by the Spanish courts, did not require employers to establish a system for the registration of all working hours for the individual staff members within their organisations.

Systems that record working hours are necessary in order to effectively protect employees

The ECJ ruled that staff working hours are primarily governed by the Working Time Directive and by the EU Charter of Fundamental Rights. These legal documents establish rules regarding daily and weekly periods of rest, and they establish maximum limits for weekly working time. The Court noted that member states are obligated to adopt the measures needed to effectively safeguard employee rights, but that EU law does not impose any specific or concrete requirements as to the precise ways in which these rights should be safeguarded in practice.

The Court found that, realistically, it is impossible to determine actual staff working hours and overtime hours in an objective and reliable way in the absence of a system that can be used to measure and record the individual daily hours worked by each employee. According to the Court, it is therefore unreasonably difficult or practically impossible for employees to enforce their rights on the limitations regarding working time in accordance with EU law.

On this basis, the Court found that member states are obliged to ensure that employers establish objective, reliable and accessible systems that can be used to measure the length of each individual employee’s daily working time. According to the Court, such a system can be used to ensure that employees have an effective way to protect their rights while also making it easier for employees to document their case in the event that their rights are violated. During the case, the Spanish government argued that a requirement for employers to introduce such a system for the recording and tracking of daily staff working hours would entail huge costs on the part of employers, but the court found that the need to protect the safety and health of employees weighed more heavily than such financial considerations.

The Court therefore ruled that it is a violation of EU law if member states do not oblige employers to establish a system for the tracking of individual employee working hours. The Court also noted, however, that it is up to each individual member state to determine the precise rules that should apply to these working hour recording systems, including whether or not special rules should apply for certain sectors or companies of a certain size.

IUNO’s opinion

The ruling is very far-reaching, as it states that all member states require employers to record their employees' actual daily working hours. This will entail a considerable financial and administrative burden for companies.

It is currently unclear exactly how Danish law will be amended in light of the ruling, but it is likely that an amendment to the Working Environment Act will be proposed in the new parliamentary session. Sweden and Norway, on the other hand, already have such rules in place, although perhaps not as far-reaching as may be required under the EU rules. Companies in Sweden are required to record overtime and on-call time and companies in Norway are required to keep a written and continuous overview of the actual daily working hours. In both Sweden and Norway, employees in independent or managerial positions are exempted.

IUNO recommends that companies already now prepare for when they will have to record the daily working hours of all employees. We will be closely following the implementation of this ruling and will report back when there are new developments.

[European Court of Justice ruling of 14 May 2019 in case C-55/18]

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