Global menu

Our global pages

Close
Print Friendly and PDF

Global Employment and Labor Law Update - February 2021

Welcome to this first edition of our quarterly Global Employment and Labor Law Update for 2021.

As we start the new year, many businesses continue to refresh and revise plans to reflect the changing economic environment. At the same time, governments around the world continue to reform and bring in new laws, many of which have been precipitated or accelerated by the pandemic. Our work across the globe gives us a genuine insight into such developments, both as they are enacted and those on the horizon, allowing us to help our clients plan their people strategies.

In this quarter, emerging themes include developments in the areas of remote working, diversity and inclusion and enhanced family-friendly rights. Further, as businesses continue to grapple with the financial impact of the pandemic, we see new developments in Government financial support and measures protecting the ongoing employment of workers.

We hope you find the practical information useful in managing your global employment challenges. Please do not hesitate to contact us if you wish to find out more.

Diane Gilhooley Diane Gilhooley
Global Head of Employment, Labor and Pensions
dianegilhooley@eversheds-sutherland.com

Asia Global Update Banner

South Africa

Subject Matter/Name of Development

Disciplinary action during notice period (case law)

Summary

In the case of Standard Bank of South Africa Limited v Nombulelo Cynthia Chiloane (JA 85/18) [2020] ZALAC (5 November 2020), the Labour Appeal Court clarified that a resignation with immediate effect by an employee does not deprive an employer of their right to discipline such an employee during the contractual notice period. If there is no such contractual notice period, the notice period in s.37 of the Basic Conditions of Employment Act 75 of 1997 (“BCEA”) will apply and the employer can discipline the employee during that period.

Impact Date

10 December 2020

Employer Implications/Action Needed

Employers have the freedom to choose either to waive the notice period or have the employee serve it (the length of such period calculated under the contract or, in the absence of a contractual notice period, in accordance with s.37 of the BCEA). If the employer chooses to hold the employee to the notice period, the employer may discipline the employee during this time. Employers should review disciplinary policies and ensure that such policies reflect this position.

Employer Risk

N/A.

Subject Matter/Name of Development Protected lockouts (case law)
Summary

In the case of The Airline Pilots Association of South Africa v South African Airways SOC Limited and Others (J 1507/2020) [2020] ZALC, it was determined that a lockout of members of The Airline Pilots Association of South Africa was lawful and did not constitute a suspension of employment contracts (which is unlawful under the Companies Act 71 of 2008). In particular, that the decrease of a business’s operation does not mean that there is no workplace for the lawful implementation of a lockout. Further, that a lockout notice is not required to involve all employees in respect of whom a dispute is referred, and the referral to conciliation and the notice of lockout may vary in wording if the issue in dispute remains the same. The Labour Court therefore dismissed the application to have the lockout declared unlawful or unprotected.

Impact Date

29 December 2020

Employer Implications/Action Needed

Although the lockout in this case was deemed lawful, this case highlights the grounds on which the legality of a lockout can be challenged. Employers should ensure that the process to effect any lockout is carefully considered and undertaken.

Employer Risk

Employers risk losing the indemnity against civil proceedings and liability for breach of contract if a lockout is deemed unlawful.

Contact:

Sandro Milo
Partner
+27 834 4403 20
sandromilo@eversheds-sutherland.co.za

Africa Global Update Banner

China

Subject Matter/Name of Development New judicial interpretation on trial of labour disputes
Summary

In order to facilitate the implementation of the PRC Civil Code, the PRC Supreme Court “cleared away” a large amount of previous judicial interpretations and legislative/governmental documents and issued the first batch of new judicial interpretations. These include one on issues concerning the trial of labour dispute cases (最高人民法院关于审理劳动争议案件适用法律问题的解释(一), “New Labour Interpretation”).

However, the New Labour Interpretation is essentially a compilation of four previous judicial interpretations and no material revisions have been included.

Impact Date

1 January 2021

Employer Implications/Action Needed

Article 34 (which deals with the circumstance where an employee continues to work for the employer upon expiry of the employment contract and the employer fails to object, “Circumstance”) has triggered heavy debate in practice. If an employer intends to continue the employment of the employee, to minimise potential risks, the employer should always renew the employment contract in writing upon its expiry.

Employer Risk

Whether an employer has the right to terminate the employment contract without cause under the Circumstance based on the New Labour Interpretation may still be subject to local tribunal/court discretion. Employers are recommended to seek legal advice and take appropriate action accordingly.

Subject Matter/Name of Development Online recruitment services
Summary

The PRC Administration of Human Resources and Social Security has issued the Provisions on Administration of Online Recruitment Services (网络招聘服务管理规定, “Provisions”).

The Provisions confirmed, amongst others, that

  • ‘online recruitment services’ refers to the job search and recruitment services provided to job applicants and employers by qualified HR service providers within the PRC through information networks (e.g. Internet) by means of online recruitment service platforms, in-platform operation, self-established websites or other network service modes
  • a HR service provider must obtain the HR Service Permit from the local labour bureau before it can provide online recruitment services
  • when providing online recruitment services, HR service providers shall take technical measures and other necessary measures to ensure the security of the relevant networks, information systems and user information in accordance with the national cybersecurity law
Impact Date

1 March 2021

Employer Implications/Action Needed

Before engaging a HR service provider to provide online recruitment services, employers should ensure the service provider has a HR Service Permit with ‘carrying out online recruitment services’ explicitly included.

Employers should also ensure that the information provided to the qualified HR service provider for online recruitment purposes (e.g. conditions, role details, location, basic remuneration) is lawful, true and non-discriminatory.

Employer Risk

Employers may face administrative and/or civil liabilities in the event of any failure to comply with the Provisions.

Subject Matter/Name of Development Shared Employees
Summary

In order to implement the relevant requirements under the Notice on Guidance and Service Regarding Employee Sharing (“National Guidance”), the Beijing Human Resource and Social Security Bureau released local guidance (北京市共享用工指导和服务指引, “BJ Guidance”) and it is generally in line with the National Guidance.

In addition to the employee sharing-related services and guidance that may be provided by the local labour bureau, the BJ Guidance further specifies the relevant rights and obligations of the three parties, i.e. the employer, the shared employee and the company short of workers, respectively.

Impact Date

9 December 2020

Employer Implications/Action Needed

Employers in Beijing should follow the BJ Notice to ensure their legal compliance in relation to employee sharing.

Employer Risk

The BJ Notice provides that the channels for public complaints and tip-offs should be freed of blockages and law enforcement should be strengthened, in order to punish the infringement of shared employees’ legal rights and interests. On this basis, failure to fully comply with the BJ Notice may trigger potential liabilities/penalties.

Subject Matter/Name of Development

Work-related injury: Jiangsu and Guangdong Provinces

Summary

The Measures on Workers over Statutory Retirement Age and Interns Participating Work-related Injury Insurance in Jiangsu Province (江苏省超过法定退休年龄人员和实习生参加工伤保险办法, “JS Measures”) and the Measures on Special Workers Participating Work-related Injury Insurance (Trial Implementation) (关于单位从业的超过法定退休年龄劳动者等特定人员参加工伤保险的办法(试行, “GD Measures”) have been released.

The JS Measures provides, amongst others, that employers may, on a voluntary basis, go through the registration formalities for work-related injury insurance and pay insurance contributions for its “Overaged Workers” (i.e. those who have reached statutory retirement age - 60 for males and 50/55 for females - but have not reached 65 nor completed the retirement formalities at the competent local authority) and “Interns” (i.e. those who have reached 16 and are collectively arranged by the relevant vocational school to work for the employer for on-the-job internship purposes).

Similar to the JS Measures, the GD Measures also provides that employers may pay work-related injury insurance for special workers such as individuals over statutory retirement age and intern students on a voluntary basis.

Impact Date

1 February 2021 – JS Measures 1 April 2021 – GD Measures

Employer Implications/Action Needed

Employers in both Provinces may consider paying contributions to work-related injury insurance for their Overaged Workers and Interns in accordance with the JS Measures.

Employer Risk

Employers are recommended to pay work-related injury contributions and/or procure sufficient commercial insurance for their special workers, so as to mitigate the high costs that may arise from personal injury/accident suffered by special workers.

Contact:

Jack Cai
Partner
+862161371007
jackcai@eversheds-sutherland.com

Hong Kong

Subject Matter/Name of Development

Post-termination, non-competition covenants (case law)

Summary

In a recent case (AB Club Ltd & Anors v Chan Yin Ki Cubie & Anors [2020]), the Court of First Instance refused to grant an interim injunction restraining former employees from competing with the employer’s business because the employer delayed in seeking the injunction for three weeks.

Impact Date 30 September 2020
Employer Implications/Action Needed

In a case of an employee’s breach of a non-compete or non-solicitation clause, employers should apply for an injunction as soon as it is aware of grounds to make the application.

To protect the interests of the company, an employer should review an employee’s pre- resignation conduct to identify potential breaches of the non-compete or nonsolicitation obligations as soon as possible.

Employer Risk

The court has made it clear that an unexplained delay of more than two weeks in enforcing a post-termination covenant may lead to a conclusion that there is no urgency for an injunction and to a refusal of the employer’s application.

Employers should therefore minimise any delay in applying for injunction relief.

Links

The Importance of Right Timing

Subject Matter/Name of Development

Guidance on working from home

Summary

The Office of the Privacy Commissioner for Personal Data, Hong Kong (“PCPD”) has issued three practical guidance notes relating to working from home (“WFH”) for (1) organisations, (2) employees and (3) users of video conferencing software, to provide practical advice for enhancing data security and to protect personal data privacy.

Impact Date

30 November 2020

Employer Implications/Action Needed

Employers should refer to PCPD’s guidance note to establish appropriate policies; provide sufficient staff training and support in relation to WFH arrangements and to ensure data security and protection of personal data privacy.

Additionally, employers should ensure employees are aware of PCPD’s recommendations on the use of video conferencing software.

Employer Risk

Employers should note the data security and personal data privacy risks which may arise during WFH arrangements, and put in place appropriate measures and policies with reference to PCPD’s recommendations.

Links

Working From Home

Subject Matter/Name of Development

Updates on new maternity leave provisions

Summary

The Labour Department has published a “Frequently Asked Questions” document regarding December’s Employment (Amendment) Ordinance 2020 and has provided updates on the reimbursement of maternity leave pay scheme (RMLP Scheme).

The RMLP Scheme is expected to be operational in the first half of 2021.

Impact Date

11 December 2020

Employer Implications/Action Needed

Employers who wish to apply for reimbursement under the RMLP Scheme are required to keep relevant/supporting employment records and documents regarding pregnant employees including:

  • payment records for the 14 weeks’ statutory maternity pay;
  • wage records for the 12 months preceding the commencement of maternity leave; and
  • proof of pregnancy (as provided by the employee)
Employer Risk

Since the changes in maternity leave entitlements are in effect and applicable to all employees giving birth on or after 11 December 2020, employers should make sure their relevant policies are compliant.

Links

Updates on the Implementation of the New Laws on Maternity Leave

Subject Matter/Name of Development

Temporary relaxation of visa restrictions for non-permanent residents

Summary

In light of COVID-19 travel restrictions, on 31 December 2020 the Immigration Department relaxed requirements for applications for extensions to stay by non-permanent residents currently outside Hong Kong but hoping to return.

Impact Date

31 December 2020

Employer Implications/Action Needed

Employees may now renew their employment visas while they are not physically in Hong Kong and within one year after the expiry of current visas.

Employer Risk

These special measures are expected to be temporary measures in response to the COVID-19 pandemic. Employers should ensure that their employees have a valid visa before undertaking any work in Hong Kong.

Links

COVID-19 - Visa Extension Applications by Non-Permanent Residents Outside Hong Kong

Contact:

Jennifer Van Dale
Partner
+852 2186 4945
jennifervandale@eversheds-sutherland.com

Singapore

Subject Matter/Name of Development

Updated Tripartite Advisory on Managing Excess Manpower and Responsible Retrenchment

Summary

This Advisory has been updated to set out clearer guidelines on carrying out retrenchment (i.e. redundancy or reorganisation) exercises. The principle of maintaining a significant proportion of Singaporean employees is emphasised, together with examples of best practice for notifying and supporting affected employees.

Impact Date

17 October 2020

Employer Implications/Action Needed

Employers contemplating any retrenchment exercise are strongly encouraged to consider the recommendations and implement them.

Employer Risk

N/A.

Link Responsible retrenchment
Subject Matter/Name of Development

Tripartite Advisory on Mental Well-Being at Workplaces

Summary

This Advisory sets out recommendations for employees, workplace teams and organisations to prevent work-related stress compromising employees’ well-being and productivity. The recommendations include providing access to counselling and implementing flexible work arrangements.

Impact Date

17 November 2020

Employer Implications/Action Needed

Employers are strongly encouraged to consider the recommendations to manage the mental well-being of their employees.

Employer Risk

N/A.

Subject Matter/Name of Development

Work pass conditions

Summary

As part of their work pass conditions under the Employment of Foreign Manpower (Work Passes) Regulations 2012, all work pass holders (excluding foreign domestic workers) are required to download the FWMOMCare mobile application and register their details by 23 December 2020. They must also supply details of any new residential address or mobile number within five days of any change.

Impact Date

23 December 2020

Employer Implications/Action Needed

Employers should ensure their foreign employees are aware of these new obligations, as the Singapore Ministry of Manpower will conduct checks, both randomly and when work passes are renewed.

Employer Risk

Non-compliance may lead to criminal liability for the employee and the revocation of their work pass, which will have consequences for the employer.

Contact:

Sze-Hui Goh
Partner

+65 8382 8702
sze-huigoh@gtlaw-llc.com

Europe Global Update Banner

Austria

Subject Matter/Name of Development Special care leave
Summary

Employees are now legally entitled to special care leave (Sonderbetreuungszeit), of up to four weeks with pay, until the end of the school year (9 July 2021). The leave is aimed, in particular, at employees caring for children under the age of 14 and can be taken in stages and on a daily and half-day basis.

Employers whose employees use special care leave are supported by the Government. However, the entitlement support is capped at the maximum monthly contribution basis under the General Social Security Act - currently EUR 5,370.

Impact Date

1 November 2020 to 9 July 2021

Employer Implications/Action Needed

Claims for support must be made to the appropriate tax office within strict timescales.

Employer Risk

N/A.

Subject Matter/Name of Development

Notice periods for blue- and white-collar workers are to be harmonized

Summary

Notice periods for blue-collar workers are often shorter than those for white-collar workers. Under this change, the statutory minimum notice periods that employers must give to terminate employment will be the same for all employees.

Where an employer terminates the employment relationship, the statutory minimum notice period will be:

  • 6 weeks (0-2 years of service);
  • 2 months (2-5 years of service);
  • 3 months (5- 15 years of service);
  • 4 months (15-25 years of service); and
  • 5 months (25 or more years of service)

The employer’s notice is effective at each calendar quarter (31 March, 30 June, 30 September, 31 December). However, the employer and employee can agree the 15th and the last day of each month as termination dates within the employment contract.

All employees will be required to give one month’s notice to terminate their employment, to the end of the month, although the employer and employee can agree that the employee will be required to give the same period of notice as the employer.

Impact Date

1 July 2021

The Government had previously approved this change for implementation on 1 January 2021. However, due to the COVID-19 pandemic, it has been postponed to 1 July 2021.

Employer Implications/Action Needed

The new notice provisions apply to terminations by notice given after 30 June 2021.

Employers should check their employment contracts with blue-collar workers for necessary adaptions regarding the notice periods and termination dates.

Employer Risk

Terminations by notice can be very costly if a wrong notice period or termination date is applied.

Contact:

Silva Palzer
Partner
+43 15 16 20 12 5
silva.palzer@eversheds-sutherland.at

Belgium

Subject Matter/Name of Development

Birth leave has been increased to 15 days

Summary

Birth leave (formerly called ‘paternity leave’) has been increased to 15 days. From 1 January 2023, it will be increased to 20 days. The process for taking leave remains the same; the father (or co-mother) may take the leave within 4 months of the birth with the employer paying for the 3 first days of absence and the remaining days covered by an allowance from the authorities.

Impact Date 1 January 2021
Employer Implications/Action Needed

Employers should amend their applicable policies.

Employer Risk

N/A.

Subject Matter/Name of Development

COVID-19 : extended entitlement to quarantine leave

Summary

Originally, quarantine leave was only available in the event of a day nursery, school or care centre closing. However, access has been extended to other situations in which employees have to take care of their children as a result of measures to limit the spread of the coronavirus and are therefore unable to continue employment.

Impact Date

1 October 2020 (retroactively) until 31 March 2021, but may be prolonged.

Employer Implications/Action Needed

The employee is authorised to stay at home without pay.

Employer Risk

N/A.

Contact:

Stefan Corbanie
Partner
+32 27 37 93 51
stefancorbanie@eversheds-sutherland.be

Czech Republic

Subject matter/Name of Development

Extension of the Antivirus Job Retention Programme

Summary

The Programme has been again extended until 28 February 2021.

An employer can receive state aid: up to 100% (or up to 80%) of wages paid (Mode A Plus or Mode A) in the event of a forced closure of an establishment; or 60% of wages paid (Mode B) where the employer is unable to provide work due to COVID-related economic difficulties.

Impact Date 1 October 2020
Employer Implications/Action Needed

If a company has been affected by government measures regarding COVID-19 and work could not be assigned to employees, it may be able to apply for the subsidy, subject to time limitations.

Employer Risk

The subsidy will not be granted to late applicants.

Link

Information about the program from the Ministry of Labour and Social Affairs

Subject Matter/Name of Development

Labour Code change – calculating holiday entitlement

Summary

An employee’s entitlement to annual leave has changed and is now based on the number of weekly working hours. This will also be the basis for calculating the duration of annual leave.

Impact Date 1 January 2021
Employer Implications/Action Needed

Employers should change their internal holiday calculation settings. The relevant unit is hours of work, not working day.

Employer Risk

If an employer fails to update their annual leave processes, it risks a fine of up to CZK 200,000.

Subject Matter/Name of Development

Labour Code change – shared workplace (job-shares)

Summary

At least two employees with the same type of work and a shorter agreed working time will be able to share, subject to their employer’s agreement, one position and alternate their attendance.

Impact Date 1 January 2021
Employer Implications/Action Needed

Job-sharing allows an employer to employ at least two part-time workers in one position.

Employer Risk
Subject Matter/Name of Development

Labour Code change – workplace injury and employer compensation

Summary

The list of survivors who are entitled to one-off compensation (for example, for a workplace death) is expanding and the amount of compensation is at least twenty times the average national wage.

Impact Date 1 January 2021
Employer Implications/Action Needed

In cases involving the death of an employee, the employer must compensate the employee’s adult children or parents, even if they did not share a household with the employee.

Employer Risk

If compensation is not paid voluntarily by the employer, it is likely to be enforced through a court.

Subject Matter/Name of Development

Minimum wage level for 2021

Summary

The minimum wage is CZK 15,200 per month and CZK 90.50 per hour. Higher levels of minimum wage (minimum guaranteed wage) exist for different categories of employees depending on the skills and qualifications required.

Impact Date 1 January 2021
Employer Implications/Action Needed

All employees are entitled to a minimum wage (or minimum guaranteed wage) in this specified amount.

Employer Risk

In the event that the employer does not pay at least the minimum wage, a fine of up to CZK 2,000,000 may be imposed.

Subject Matter/Name of Development

Employee training disrupted by COVID-19

Summary

Due to COVID-19 disruption, employers are being relieved of certain repeat training qualification obligations. Employees who met the qualifications previously are deemed to be qualified until June 2021.

Impact Date 19 December 2020
Employer Implications/Action Needed

The employer does not have to provide qualification training for its employees until at least the end of June 2021 and will continue to meet certain workplace requirements even where, for example, certification has expired.

Employer Risk

N/A.

Subject Matter/Name of Development

Terminating the employment of a trade union official – Supreme Court decision

Summary

Generally, an employer may unilaterally terminate the employment of a trade union official only with the consent of the trade union. If consent is withheld, the employer may still terminate if it cannot be fairly required to continue employing the employee. The Supreme Court clarified that a trade union official may be selected for redundancy based on previous repeated misconduct, poor treatment of customers and lack of qualification.

Impact Date 26 August 2020
Employer Implications/Action Needed

Even where the consent of the trade union is withheld where the redundancy termination of their official is involved, it is not automatically the case that other employees must instead be selected for dismissal.

Employer Risk

N/A.

Contact:

Radek Matouš
Managing Attorney
radek.matous@dhplegal.com

Denmark

Subject Matter/Name of Development Parental rights – bereavement leave
Summary

A right to extended bereavement leave has been adopted. The right has been extended to 26 weeks if a parent loses a child under the age of 18.

Impact Date

1 January 2021

Employer Implications/Action Needed

The extended right applies to both parents, whether they are biological or adoptive parents. It includes the right to be absent from work and to maternity benefits during that time, if the parents meet conditions under the Danish Maternity Act. Employers need to review and update their policies to reflect this change.

Employer Risk N/A.
Subject Matter/Name of Development Immigration changes
Summary

Changes to immigration legislation aim to strengthen compliance control in relation to the working conditions of foreign employees, and to prevent circumvention of the applicable rules. Among the changes, residence and work permits may be rejected if there is reason to believe that an employment offer is not genuine. There are also provisions for the Danish Agency for International Recruitment and Integrations (SIRI) to make inspection visits.

Impact Date 1 January 2021
Employer Implications/Action Needed

Employers should review their immigration arrangements for compliance.

Employer Risk N/A

Contact:

Anne Marie Abrahamson
Partner
+45 35252858
AMA@Lundgrens.dk

The EU

 

Subject Matter/Name of Development

EU employment law and Brexit

Summary

The UK-EU Trade and Cooperation Agreement, agreed at the end of 2020, addresses the future development of EU (and UK) employment laws and standards. In broad terms, it means that if the current level playing field on workers’ rights is undermined by the UK, affecting trade and investment between the parties, the EU may (subject to conditions) be able to apply retaliatory measures.

Impact Date

The Agreement is provisionally in force from 1 January, pending ratification

Employer Implications/Action Needed

For employers with pan-UK/EU operations, it appears that significant divergence between EU and UK law will be unlikely in the short-term. However, if the EU moves to further extend or strengthen EU employment standards, this may trigger a review in the medium-term (4-5 years) if the UK significantly fails to keep pace and if competition is materially distorted.

Employer Risk

Employers should prepare for piecemeal divergence between UK and EU employment law. HR and legal teams will need to keep up-to-date and be ready to amend policies and practices to ensure compliance in the different jurisdictions.

Subject Matter/Name of Development

New initiatives on platform workers, and on adequate minimum wages

Summary

The EU is preparing to consult on taking measures to ensure that European competition rules do not prevent collective bargaining by vulnerable self-employed individuals in order to support such workers to challenge pay and working conditions.

A draft Directive which aims to provide a framework to improve the adequacy of minimum wages across the EU is awaiting feedback from the EU Parliament.

Impact Date 2021 to 2023
Employer Implications/Action Needed

Collective bargaining initiative: businesses reliant upon platform workers and self-employed contractors should monitor the EU’s proposals as they develop.

Minimum wage initiative: the proposal does not set an EU-wide minimum wage. However, if agreed, employers should anticipate greater focus on any gaps in Member States’ minimum wage provision (whether by collective bargaining or otherwise), the level of such wages and how they are enforced.

Employer Risk

In the immediate term, no change. However, if both are agreed by the EU in 2021/early 2022, they should be risk-assessed by employers of lower paid ployees and self-employed contractors.

Subject Matter/Name of Development

New laws on whistleblowing, casual workers and work-life balance due for implementation

Summary

Member States will progressively implement the three outstanding employment directives on: predictable working conditions; work-life balance and whistleblowing (read our summary of each directive).

Impact Date 2021 to 2022
Employer Implications/Action Needed

All employers should expect to change their current practices relating to the provision of written statements to employees upon commencing work. Paternity, arental and carers and flexible working policies should be reviewed as national laws are amended to implement the minimum rights under the work-life balance directive. Furthermore, employers should anticipate significant change in whistleblowing regulation in some Member States.

Employer Risk

It will be for each individual Member State to decide how rights under the directives should be enforced and what the legal sanctions should be for non- compliance. Whatever the legal consequences, there will also be reputational risks for defaulters.

Contact

Constanze Moorhouse
Partner
+44 122 344 3803
constanzemoorhouse@eversheds-sutherland.com

Finland

 

Subject matter/Name of Development

Temporary changes to employment legislation enacted due to the COVID-19 pandemic regarding the reduction of the workforce in the private sector are no longer in force

Summary

With regard to lay-offs, the minimum duration of co-operation negotiations is currently 14 days or 6 weeks instead of the previous 5 days, and the lay-off notice period is 14 days instead of the former 5 days.

Employers no longer have the right to lay-off fixed-term employees and terminate employment relationships during the trial period on financial or production-related grounds.

Employers’ obligations to re-employ an employee whose employment has been terminated on financial and production-related grounds is currently 4 or 6 months instead of the previous 9 months.

Impact Date The temporary changes ended on 31 December 2020
Employer Implications/Action Needed

Employers must now comply with the requirements of the current legislation. For example, more flexible solutions for lay-offs are no longer available.

Employers should also be aware that applicable collective agreements may contain derogating provisions from the statutory ones.

Therefore, it is important to review each case separately and ensure that the correct steps are taken when reducing the workforce.

Employer Risk

Failure to comply with the correct co-operation procedure may lead to liability to pay compensation. In addition, failure to comply with other employer obligations regulated by the Employment Contracts Act may lead to liability to pay damages.

 

Subject matter/Name of Development

Supreme Court ruling on the amount of damages in a criminal case concerning work discrimination (case law)

Summary

The Supreme Court has ruled that an employee had been fully compensated by a civil case judgment regarding the same incident under the Non-Discrimination Act and the Employment Contracts Act. Previously awarded non-material damages and compensation were taken into account when assessing the amount of compensation under the Tort Liability Act.

Impact Date

17 December 2020

Employer Implications/Action Needed The ruling clarifies that compensation for non-material damage in an employment discrimination case, awarded for the unjustified termination of an employment contract, must be taken into account when assessing the amount of compensation for anguish regulated by the Tort Liability Act.
Employer Risk

Employers may be liable for damages/ compensation for the same issue under several laws. The ruling poses no new risks for employers.

Contact:

Timo Jarmas
Partner
+35 81 06 84 15 14
timo.jarmas@eversheds.fi

Germany

Subject matter/Name of Development

Extension of digital meetings according to § 129 German Works Constitution Act (BetrVG)

Summary

The Works Constitution Act enabled works councils to hold virtual meetings from May 2020. Due to the pandemic, the regulations have now been extended until June 2021 so that works council meetings, conciliation bodies and company meetings can continue to take place virtually and to enable resolutions to be passed via video and telephone conferencing.

Impact Date

27 November 2020

Employer Implications/Action Needed

Decisions based on a virtual meeting still have to be accepted. Confidentiality must also be upheld in virtual works council meetings e.g. unauthorized third parties must be excluded and participants should be confirmed to the works council chairperson by e-mail.

Employer Risk

N/A.

Subject matter/Name of Development

So-called crowdworkers can be classified as employees

Summary

Crowdworking companies usually engage in small-scale tasks which are posted on an online platform to be performed by an unknown group of people (the “crowd”) who have registered online to undertake such tasks. After a task has been completed successfully, a fixed amount of money is credited to the individual. The Federal Labor Court has ruled for the first time that a crowdworker can have an employment relationship with the platform operator based on established criteria such as that they lack the independence of self-employment, being reliant on others’ instructions. In all cases the specific circumstances must be taken into account and an overall assessment of status must be made.

Impact Date

1 December 2020

Employer Implications/Action Needed

Companies engaging crowdworkers should not offer additional benefits based on activity or penalise those who are inactive. Crowdworkers should also be given as much freedom as possible with regard to the time, place and type of execution of tasks.

Employer Risk

If a company offers crowdworking, special attention should be paid to the autonomy of participants if an employment relationship is to be avoided (along with the advantages of employment, such as holiday entitlements).

Subject matter/Name of Development

Certification of health insurance

Summary

An employee’s obligation to submit membership certificates from the health insurance funds in paper form will no longer be necessary at the beginning of employment and/or upon a change of fund. The employee must simply inform the employer of their health insurance fund when taking up employment/ making a change. The insurer will then confirm membership electronically.

Impact Date

1 January 2021

Employer Implications/Action Needed

The Employer can register employees for social security based on information provided by the employee but must double-check the electronic response from the health insurance funds.

Employer Risk

N/A.

Subject matter/Name of Development

Added protection for parents’ earnings

Summary

Parents/guardians of young children at home due to extended school or company holidays, school closures or disrupted schooling, may be entitled to compensation for lost earnings where no other reasonable care option can be secured for a child under 12 or with a disability. The amount of compensation will be 67% of lost earnings, up to a maximum of EUR 2,016 per month over 20 weeks (divided between parents where there are two working). The 20 weeks can be spread over several months.

Impact Date

16 December 2020 (applies retrospectively)

Employer Implications/Action Needed

Compensation is paid by the employer, who can apply for reimbursement from the competent federal state authority.

Employer Risk

N/A.

Link

Arbeitsgericht Düsseldorf

Subject matter/Name of Development

New figures for social security contributions and an increase to the minimum wage

Summary

The income threshold in the statutory health insurance increased from 1 January 2021 to EUR 58,050 per year (EUR 4,837.50 per month). The compulsory insurance ceiling is therefore now EUR 64,350 per year (EUR 5,362.50 per month).

The statutory minimum wage rose to EUR 9.50 gross per hour from 1 January 2021, and will increase in further steps to EUR 9.60 gross on 1 July 2021; EUR 9.82 gross on 1 January 2022, and EUR 10.45 gross on 1 July 2022.

Impact Date

1 January 2021

Employer Implications/Action Needed

Employers must ensure that the applicable minimum wage rate is paid in all cases, especially noting the scheduled rate rises.

Employer Risk

Non-payment of the minimum wage can result in fines and penalties.

Link

https://www.bundesregierung.de/breg-de/aktuelles/beitragsbemessungsgrenzen-2021-1796480 

Contact:

Frank Achilles
Partner
+49 89 54 56 52 75
frankachilles@eversheds-sutherland.com

Hungary

Subject matter/Name of Development

New home-working regulation during state of emergency

Summary

The Government has adopted a temporary regulation in connection with Teleworking during the state of emergency resulting from COVID-19. Employers and employees are allowed to deviate from provisions of the Hungarian Labour Code related to Teleworking during this period.

Impact Date 11 November 2020 until the end of the state of emergency (expected 8 February 2021, subject to extension)
Employer Implications/Action Needed

During the state of emergency, employers are not obliged to carry out a risk assessment regarding the home-office workplace, or to examine working tools and the working environment for safety purposes. Instead employers should inform employees of the rules of healthy and safe working conditions, enabling employees to choose their workplace.

Employer Risk

Employers are temporarily relieved of health and safety standards at home if home-working is agreed.

Web link

N/A.

Subject matter/Name of Development

Compensation for home-working costs during the temporary state of emergency

Summary

Employers are able to support home-working with a tax free lump sum payment in lieu of employee expenditure (such as for water, gas, electricity, internet, etc.). Up to HUF 16,100 (around €45) per month may be paid. This payment is optional, not mandatory.

Impact Date 11 November 2020 until the end of the state of emergency (expected 8 February 2021, subject to extension)
Employer Implications/Action Needed

To apply the tax exemptions, a home-working agreement should be concluded between the employee and employer.

Employer Risk

N/A.

Subject matter/Name of Development

Commissioner for Fundamental Rights to enforce equal treatment

Summary

Previously, the Equal Treatment Authority had responsibility for investigating complaints of alleged discrimination. This role has now been taken over by the Commissioner for Fundamental Rights.

Impact Date 1 January 2021
Employer Implications/Action Needed

Employers should note that employee complaints of alleged discrimination will now be handled and investigated by the Commissioner for Fundamental Rights.

Employer Risk

N/A.

Contact:

Katalin Varga
Partner
+36 (1) 394 31 21
varga@eversheds-sutherland.hu

Ireland

Subject Matter/Name of Development Increase to parent’s leave
Summary

Parent’s leave (leave entitlement for new parents) is to increase from 2 to 5 weeks for each parent. Parents will be able to take the leave during the first 2 years of the child’s life or adoption.

Impact Date 1 April 2021
Employer Implications/Action Needed

Employers should be aware that eligible employees can take leave as one continuous period of 5 weeks or in single weekly blocks.

Current policies on parent’s leave should be updated to take account of the increased entitlement from 1 April 2021.

Employer Risk

A failure to grant the new parent’s leave entitlement could result in a claim to the Workplace Relations Commission (WRC).

Subject Matter/Name of Development

Increase in minimum wage

Summary

The national minimum wage has increased by 10 cent per hour, from EUR 10.10 to EUR 10.20.

Impact Date 1 January 2021
Employer Implications/Action Needed

Employers need to ensure that all employees are receiving the updated minimum wage.

Employer Risk Non-payment of the increased minimum wage rate can lead to employee complaints to the WRC and to WRC investigation. In addition, if an employee is dismissed for seeking the national minimum wage, the employee may bring a claim for unfair dismissal.
Link

Government approves increase in the National Minimum Wage from 1st January 2021

Subject Matter/Name of Development Increase to parental leave
Summary

Parental leave (unpaid leave entitlement for parents to look after their children) has increased from 22 weeks to 26 weeks. The leave must be taken before the child’s 12th birthday.

Impact Date 1 September 2020
Employer Implications/Action Needed

Employers should consider parental leave requests in light of this new entitlement.

Employers should consider updating their parental leave policy to take into account the increase in leave since 1 September 2020.

Employer Risk A failure to grant an employee their full parental leave entitlement can result in a claim to the WRC.

Contact:

Joanne Hyde
Partner
+35 31 66 44 25 2
joannehyde@eversheds-sutherland.ie

Italy

Subject Matter/Name of Development Extension and renewal of fixed-term employment contracts
Summary

By derogation of the ordinary rules, Law Decree n. 178/2021 provides that until 31 March 2021 a further single extension of a fixed-term employment contract will be permissible for a maximum period of 12 months (the maximum duration of the fixed term being 24 months) without the need to specify one of the mandatory reasons provided by Legislative Decree n. 81/2015.

Impact Date 1 January 2021
Employer Implications/Action Needed

After 31 March 2021 the extensions/renewals of fixed-term employment contracts will be subject to ordinary rules.

Employer Risk A failure to comply with the requirements for fixed-term contracts may lead to the contract being deemed permanent.
Subject Matter/Name of Development Ban on dismissals extended
Summary

A ban on dismissals due to economic reasons (individual or collective) has been extended to 31 March 2021. The ban does not apply in the event of business closure (without any partial continuation or transfer to a third party).

Impact Date 1 January 2021 until 31 March 2021
Employer Implications/Action Needed

Termination of employment remains possible notwithstanding the ban if agreement is reached with the trade union and the employee, or if the dismissal is unrelated to economic circumstances (e.g. is for reasons of misconduct).

Employer Risk A dismissal in breach of and during the period of the ban will be ineffective.
Subject Matter/Name of Development Suspension of social security contributions for some under 35’s
Summary

For the year 2021-2022 the payment of social security contributions will be suspended for new employees and those transferring from fixed term to permanent contracts who are under the age of 35. The suspension is capped at EUR 6,000 per year and for a period of 36 months (extended up to 48 months in the specified regions of Abruzzo, Molise, Campania, Basilicata, Sicily, Puglia, Calabria and Sardinia).

Impact Date 1 January 2021
Employer Implications/Action Needed

Employers should be aware of the option to suspend social security contributions for relevant employees.

Employer Risk Risk of over-payment of contributions.
Subject Matter/Name of Development Suspension of social security contributions for some female employees on fixed term contracts
Summary

Payment of social security contributions (except for premiums/ contributions due to the National Authority for Insurance against Accidents at Work or “INAIL”) may be suspended by employers for female employees engaged on fixed term contracts who are either new recruits or who transfer to fixed term contracts. The suspension applies for a maximum period of 12 months (extendable to a maximum of 18 months) and is capped at EUR 6,000 per year.

Impact Date 1 January 2021
Employer Implications/Action Needed

Employers should be aware of the option to suspend social security contributions for relevant employees.

Employer Risk

Risk of over-payment of contributions.

Subject Matter/Name of Development Working from home
Summary

As per Law Decree no. 183/2020 and by derogation of ordinary rules, until 31 March 2021 employers can implement working from home in the absence of individual agreement of the employee.

Impact Date 31 December 2020 until 31 March 2021
Employer Implications/Action Needed

This change will facilitate working from home in light of the COVID-19 pandemic. However, employers should bear in mind that they are still required to provide employees with INAIL, information regarding health and safety whilst working from home.

Employer Risk

N/A.

Link

Continuity of administrative action

Contact:

Marcello Floris
Partner
+39 02 892 871
marcellofloris@eversheds-sutherland.it

Valentina Pomares
Partner
+39 02 892 871
valentinapomares@eversheds-sutherland.it

Netherlands

Subject Matter/Name of Development Statutory rate rises: minimum wage and maximum severance pay
Summary

The minimum wage for employees aged 21 or over has been increased from EUR 1,680.00 gross to EUR 1,684.80 gross per month (excluding the statutory 8% holiday allowance), based on full-time employment. The maximum daily wage has been increased from EUR 222.78 gross to EUR 223.40 gross. Also, the cap on statutory severance payments has been increased from EUR 83,000 gross to EUR 84,000 gross. The exception, which entitles employees to one annual salary if this amount exceeds EUR 84,000 gross, remains applicable.

Impact Date

1 January 2021

Employer Implications/Action Needed

Employers must (i) ensure all employees receive at least the statutory minimum wage, (ii) check whether salary levels required for certain exceptions (e.g. including holiday allowance in salary if salary equals 3x minimum wage) are still being met, (iii) observe the maximum daily wage (e.g. regarding sick pay) and (iv) observe the maximum severance payment in the event of termination.

Employer Risk

Failure to pay the statutory minimum wage may result in wage claims (including the statutory increase of 50%) from employees and fines from the Inspectorate SZW of between EUR 500 and EUR 10,000 per employee. Additionally, this may negatively affect employer reputation.

Subject Matter/Name of Development Misclassification of independent contractors
Summary

Employers and/or independent contractors are able to access a pilot module online which assesses whether an assignment could indicate employment status, rather than that of independent contractor. The results of the online assessment have no legal status during the pilot phase and the pilot will be reviewed after 6 months. The government will subsequently decide if and when it will clamp down further on disguised employment (but this is not expected before October 2021, at the earliest).

Impact Date

11 January 2021

Employer Implications/Action Needed

Employers can use the pilot to assess the risk of challenge to independent status and a potential liability to pay (wage) taxes and/or social security contributions resulting from “disguised employment” and/or “misclassification”.

Employer Risk

As the results of the online module are merely indicative, employers cannot rely on them and may still be held liable to pay (wage) taxes and/or social security contributions with respect to an independent contractor due to “disguised employment” and/ or “misclassification”.

Subject Matter/Name of Development Dismissal of statutory directors of foundations
Summary

The new Management and Supervision of Legal Entities Act brings dismissal protection for statutory directors of foundations more in line with that applicable to statutory directors of NV’s and BV’s. At the request of an interested party and/or the public prosecutor, the court may dismiss a director for dereliction of their duties, for other important reasons or due to significant changes in the foundation’s circumstances. The court cannot order the foundation to reinstate a dismissed director or member of the supervisory board of foundations.

Impact Date

1 January 2021

Employer Implications/Action Needed

It is no longer necessary to follow all regulations of Dutch dismissal law with respect to the dismissal of a statutory director and/or member of the supervisory board of a foundation. Foundations can request the court to terminate the employment contract on the basis of the new regulation included in Section 2:298 of the Dutch Civil Code. It is expected that this change will make such dismissals easier to achieve.

Employer Risk

N/A.

Subject Matter/Name of Development On-call contracts
Summary

An amendment to the Dutch Civil Code will require that employers must offer on-call employees fixed hours once they have been engaged for 12 months and must do so within 2 months of that anniversary (the ‘statutory commencement date’).

Impact Date

1 July 2021

Employer Implications/Action Needed

Employers will have limited opportunity to delay the introduction of fixed hours once an engagement has lasted 12 months.

Employer Risk

Failure to offer an on-call employee a fixed number of working hours by the statutory commencement date will expose the employer to claims for additional pay from that date and to payment of the statutory increase of 50% for late salary payments.

Subject Matter/Name of Development Applicable premium rate
Summary

The Dutch Government has announced that a corrective provision, which will require employers to pay backdated higher unemployment benefit premiums for permanent employees who have worked more than 30% overtime in a calendar year, will not take effect in 2021 due to the COVID-19 pandemic.

Impact Date

1 January 2021

Employer Implications/Action Needed

During 2021, employers will not be required to pay the higher premium rate retrospectively in the event that an employee has worked more than 30% overtime.

Employer Risk

N/A.

Subject Matter/Name of Development

Pension provision for payroll employees

Summary

Employers must provide “adequate” pension provision for payroll employees. A pension scheme will be considered adequate if a number of conditions are met, such as no qualifying service requirement and accrual of at least old-age pension and surviving dependents’ pension. Alternatively, payroll employees must have access to a scheme to which other employees performing the same or similar roles within the company or industry have access.

Impact Date

1 January 2021

Employer Implications/Action Needed

Employers must ensure payroll employees have access to an adequate “pension scheme” within the meaning of the new legislation.

Employer Risk

Failure to offer an adequate pension scheme can result in a damages claim. The Inspectorate SZW cannot impose a fine for non-compliance but is authorized to audit the company (e.g. at the request of the payroll employee or the labor union), following which a report will be made which can subsequently be used to substantiate a damages claim in civil court.

Contact:

Ingrid van Berkel

Wijnand Blom

Partner Partner
+31 10 24 88 04 6 +31 20 5600 608
ingridvanberkel@eversheds-sutherland.com wijnandblom@eversheds-sutherland.nl

Norway

Subject Matter/Name of Development COVID-19: temporary rules for work-related travel
Summary

People arriving in Norway from overseas must quarantine for 10 days on arrival (entry quarantine). However, EEA or Swiss residents traveling to Norway to carry out work or assignments, are exempt from entry quarantine obligations while working if they have: tested negative for COVID-19 on arrival in Norway; tested negative again every 3 days for 10 days after arrival, and remained in private rooms for those 10 days. (This exemption does not apply to those who, during the 10 days prior to arriving in Norway, stayed in areas with particularly high levels of infection).

Impact Date

These rules were implemented with effect from 31 October 2020, and will remain in place for as long as necessary to prevent the spread of COVID-19.

Employer Implications/Action Needed

The employer must ensure the COVID-19 travel rules are complied with and may also be responsible for funding testing and providing a suitable place to stay during the first 10 days after arrival. The employer must notify the authorities if a positive test result is obtained.

Employer Risk

N/A.

Subject Matter/Name of Development COVID-19: extension of temporary sick pay rules
Summary

When an employee’s absence is due to COVID-19, the employer remains responsible for paying sickness benefit during the first 16 days, but can seek reimbursement from the social security scheme for any sick pay relating to the 4th day onwards.

Impact Date

These changes, originally introduced in March 2020, have been extended to 1 April 2021.

Employer Implications/Action Needed

The employer must provide evidence that the employee’s absence was related to COVID-19.

Employer Risk

N/A.

Contact:

Sten Foyn

Partner
+47 928 35 278”278
s.foyn@haavind.no

Poland

Subject Matter/Name of Development Minimum wage increases
Summary

New minimum wage rates have been introduced as follows:

  • employment contracts - PLN 2,800 (approx. EUR 615)
  • hourly rate for civil law contracts - PLN 18.30 (approx. EUR 4)

As a consequence, the statutory cap for redundancy payments (employers with 20+employees), increases to PLN 42,000 (approx. EUR 9,200).

Impact Date

1 January 2021

Employer Implications/Action Needed

Employers must adjust the remuneration of their employees/contractors to at least the minimum wage level.

Employer Risk

Payment in breach of the minimum wage may lead to fines of between PLN 1,000 to PLN 30,000 (approx. EUR 220 to EUR 6,700).

Subject Matter/Name of Development New immigration rules for UK workers
Summary

UK workers and their family members residing in Poland before 1 January 2021 are entitled to remain in Poland under current rules, upon fulfilling certain registration requirements. However, those migrating to Poland after 1 January 2021 are subject to the general rules of entry and stay applicable to third-country nationals.

Impact Date

1 January 2021

Employer Implications/Action Needed

Employers are obliged to take the new rules into account when hiring UK workers, in particular, the mandatory right to stay checks.

Employer Risk

Sanctions for illegal employment may be imposed if employers do not fulfil their obligations relating to the employment of foreign nationals.

Subject Matter/Name of Development Notification obligations on conclusion of contracts for a specific task
Summary

Employers must notify the Social Security Authority (ZUS) when a contract for a specific task has been concluded. Any such contracts with employees are excluded from this obligation.

Impact Date

1 January 2021

Employer Implications/Action Needed

Employers engaging contractors to perform a specific task must inform the Social Security Authority within 7 days of conclusion of the contract, using the relevant form.

Employer Risk

The sanction for non-compliance is a fine not exceeding PLN 5,000 (approx. EUR 1,100).

Subject Matter/Name of Development Proposals to introduce remote working into the Labour Code
Summary

The government is working on an amendment to the Labour Code (based on COVID-19 rules) which would permanently introduce remote working into the Labour Code, amending the so-called “telework” rules.

Impact Date

First quarter of 2021

Employer Implications/Action Needed

No draft has been published yet, therefore no actions are currently required.

Employer Risk

None currently.

Contact:

Ewa Lachowska-Brol
Partner
+48 22 50 50 79 7
ewa.lachowska-brol@eversheds-sutherland.pl

Romania

Subject Matter/Name of Development Increase in national minimum wage
Summary

The national minimum gross wage has increased to RON 2,300 (approx. EUR 472) for a full-time position.

Impact Date

13 January 2021

Employer Implications/Action Needed

Employers should meet the new pay obligations.

Employer Risk Failure to comply may trigger a fine and is also a criminal offence, punishable by imprisonment.
Subject Matter/Name of Development Potential labor law changes
Summary

Proposed amendments include:

  • reduction in the number of founding member employees required to meet the threshold for forming a trade union
  • reduction in the union membership thresholds to be met for the negotiation of a collective bargaining labor agreement
Impact Date
The law is still in draft

Currently undergoing Parliamentary scrutiny

Employer Implications/Action Needed

Employers may need to update internal policies and collective bargaining labor agreements.

Employer Risk

To be confirmed.

Subject Matter/Name of Development Suspension of individual employment contracts
Summary

Employers may suspend individual employment contracts if their activities are temporarily ceased or reduced as a result of a State-decreed curfew or state of emergency.

An unemployment allowance will be available for affected employees, which may be topped up by employers.

Impact Date 27 December 2020
Employer Implications/Action Needed

Employers must not terminate employee roles where contracts have been suspended and while they continue to be in receipt of the unemployment allowance.

Employer Risk

Employers who contravene these arrangements may be fined.

Subject Matter/Name of Development Employee benefits for remote working (telework)
Summary

Employers may pay a non-taxable allowance to employees who are working remotely to reimburse them for expenses incurred e.g. utility bills and office equipment.

Impact Date 24 December 2020
Employer Implications/Action Needed

N/A.

Employer Risk N/A.

Contact:

Mihai Guia
Partner
+40 21 31 12 56 1
mihaiguia@eversheds.ro

Russia

Subject Matter/Name of Development

Remote working legislation

Summary

New legislation has been introduced to regulate remote working, whether this is performed on a permanent basis, for a specified period or periodically. The law also addresses issues such as the provision of relevant equipment, employees’ offline rights and amends the grounds for dismissal of remote employees.

Impact Date

1 January 2021

Employer Implications/Action Needed

Employers should ensure that local practices are now in accordance with this new law, in addition to potentially updating employment contracts.

Employer Risk An employer may be held liable for failing to comply with this new law.
Link

Legal alert

Subject Matter/Name of Development

Declarations of conformity of working conditions

Summary

Rather than being valid only for 5 years, declarations of conformity of working conditions will now be valid as long as those workplace conditions are maintained. A new declaration will have to be issued only where the employer is responsible for an employee having an accident at work; being diagnosed with an occupational disease; or where there has been a breach of labor protection obligations.

Impact Date

30 December 2020

Employer Implications/Action Needed

None required.

Employer Risk N/A.
Subject Matter/Name of Development Potential extension to time limits for claiming moral damage
Summary

A new Bill is being considered which would provide employees with greater time to claim compensation for moral damage than under current regulations.

Impact Date

Awaited

Employer Implications/Action Needed

No actions are currently required as the Bill is still being considered by the State Duma.

Employer Risk N/A.
Link

Разработаны поправки о сроках подачи иска о компенсации морального вреда за нарушение трудовых прав

Contact:

Olga Chirkova
Senior Associate
+78 12 36 33 37 7
olga.chirkova@eversheds-sutherland.ru

Slovakia

Subject Matter/Name of Development Minimum wage
Summary

The application of the amended automatic minimum wage determination mechanism has been postponed due to the COVID-19 pandemic. For 2021, the minimum wage is therefore statutorily set as: EUR 623.00 per month or EUR 3.580 per hour.

Impact Date January 2021
Employer Implications/Action Needed

Employers who pay the minimum wage should monitor developments and ensure that the correct updated rates are applied from January 2021.

Employer Risk

Failure to pay at least the statutory minimum wage rate can result in both financial and criminal sanctions.

Subject Matter/Name of Development Anticipated amendments to regulation of “Tele-Commuting” and “Home-Office” arrangements
Summary

Several amendments are expected to be made to the Labour Code. One such amendment is to the existing “Tele-Commuting” and “Home-Office” sections of the Code. The amendment is expected to better regulate home-office working, which has increased as a result of the COVID-19 pandemic.

Impact Date Expected 1 March 2021
Employer Implications/Action Needed

Employers should ensure that existing policies and contracts are reviewed to identify areas where the documents may need to be updated to reflect the expected changes.

Employer Risk A fine issued by the Labour Inspectorate may be imposed in the event of a breach of the Home-Office requirements of the Labour Code.
Subject Matter/Name of Development Anticipated amendments to statutory food voucher provisions
Summary

A further expected change to the Labour Code is to food vouchers. Where employees currently receive statutorily-regulated food vouchers, the law is expected to be amended to allow employees to choose financial compensation instead of food vouchers.

Impact Date

Expected 1 March 2021

Employer Implications/Action Needed

Internal systems should be updated to allow for employees opting for financial compensation instead of food vouchers.

Employer Risk

Failure to ensure that the food voucher/ financial compensation amount is in accordance with the minimum statutory value can result in claims. A fine issued by the Labour Inspectorate may be imposed.


Contact

Helga Maďarová
Senior Associate
helga.madarova@eversheds-sutherland.sk

Spain

Subject Matter/Name of Development

Equality plans

Summary

Companies with more than 101 employees must prepare and register an equality plan by March 2021. Such equality plan must also include a remuneration audit, with an analysis of current remuneration practices and an action plan to address inequalities.

Impact Date

March 2021

Employer Implications/Action Needed

Employers should note the requirement for equality plans, including procedural requirements, how they have to be negotiated and minimum standards for their content.

Employer Risk

Breach of the requirement to establish an equality plan in accordance with the statutory requirements could result in fines ranging from EUR 6,251 to EUR 187,515. Additionally, employees could request additional damages for breach of fundamental rights.

Subject Matter/Name of Development

Maternity and paternity leave

Summary

The maximum duration of maternity and paternity leave are being equalized. Each type of leave will have the same maximum duration of 16 weeks. The first 6 weeks of maternity and paternity leave will be compulsory.

Impact Date

January 2021

Employer Implications/Action Needed

Employers should note the new leave requirements and ensure that existing policies are reviewed and updated to reflect the change.

Employer Risk

Failure to comply with paternity and/ or maternity obligations could result in employees bringing claims.

Subject Matter/Name of Development

COVID-19

Summary

It is expected that the government will approve the extension of COVID-19 legislation. This includes special procedures to carry out temporary suspension of contracts, working time reductions and restrictions on dismissals.

Impact Date Pending
Employer Implications/Action Needed

Employers should continue to monitor the anticipated extension of the legislation. If extended, employers seeking to carry out or extend temporary suspension of contracts or working time reductions or considering dismissals should ensure that the statutory limitations and requirements are understood.

Employer Risk

Failure to comply with the statutory procedures and restrictions (if applicable) could result in fines and the decision may be deemed null and void.

Contact:

Jacobo Martinez
Partner
+34 91 42 94 33 3
jmartinez@eversheds-sutherland.es

Sweden

Subject Matter/Name of Development Short-time work allowance
Summary

The short-time work allowance scheme will be extended until 30 June 2021, available to any private company facing temporary and serious financial difficulties due to COVID-19. Irrespective of any allowance received during 2020, it will be possible to apply for the allowance for up to 7 months retrospectively from 1 December 2020. The level of Government aid will be 75% of the salary costs during December-March and 50% during April-June. The employees’ working hours may be reduced by 20, 40 or 60%, as well as by 80% during January-March.

Impact Date

15 February 2021

Employer Implications/Action Needed

Employers wishing to utilise the scheme should ensure that they are able to demonstrate temporary and serious financial difficulties in coping with the challenges resulting from COVID-19.

Employer Risk

N/A.

Subject Matter/Name of Development

Immigration – UK nationals

Summary

UK nationals who have been living and working in Sweden prior to 1 January 2021 will be able to continue to do so up until 30 September 2021. In order to continue to do so following that date, they must apply for “residence status” (Sw. uppehållsstatus). The rules that currently apply to non-EEA/non-Swiss nationals will apply to UK nationals who enter Sweden on or after 1 January 2021.

Impact Date

1 January 2021

Employer Implications/Action Needed

Employers must ensure that UK nationals working in Sweden have a right to work in Sweden. A UK passport will not be sufficient to evidence that right.

Employer Risk
A court can declare a termination of
employment before the retirement age
invalid and hold the employer liable for
damages.

Employing any individual who does not have the right to stay or work in Sweden may result in a penalty charge or sentence to a fine or imprisonment.

Subject Matter/Name of Development Tax
Summary

Non-Swedish employers have previously only been obliged to deduct tax from payments for work carried out in Sweden if they have a permanent establishment in Sweden. However, from 1 January 2021, subject to some exceptions, non-Swedish employers without a permanent establishment in Sweden may be obliged to deduct tax where an employee is hired out to or is performing work for a Swedish business, even for short periods of work. In that event, the employer must also register as an employer in Sweden.

Impact Date

1 January 2021

Employer Implications/Action Needed

Non-Swedish employers without a permanent establishment in Sweden should familiarise themselves with the new tax rules, including the exceptions. One such exception is when work is only performed during a maximum of 15 consecutive days and the total number of work days in Sweden does not exceed 45 days during a calendar year.

Employer Risk

Failing to correctly report tax risks conviction for negligent tax reporting in accordance with the Tax Offenses Act.


Contact:

Per Westman
Partner
+46 85 45 32 28 8
perwestman@eversheds-sutherland.se

Switzerland

Subject Matter/Name of Development Social insurance
Summary

Due to the newly-introduced paternity leave, the loss of earnings insurance (EO) contributions that have to be paid by the employer and the employee have been increased by 0.025% each. The EO contribution rate is therefore now 0.5% (0.25% each) instead of the previous 0.45%, with the total contribution rate for the AHV/ IV/EO social insurances increased from 10.55% to 10.6%.

Impact Date 1 January 2021
Employer Implications/Action Needed

The usual practice in Switzerland is for the parties to agree a gross salary. The increase in the EO contribution rate will therefore result in a small reduction in the net salary for employees. Employers should inform employees about this reduction.

Employer Risk

Failure to take account of the increased EO contribution rate can result in incorrect payroll accounting and salary payments.

Subject Matter/Name of Development

Occupational pensions

Summary

The threshold for mandatory pension insurance has been increased from an annual salary of CHF 21,330 to CHF 21,510 (approx. EUR 19,840).

Impact Date

1 January 2021

Employer Implications/Action Needed

Employers should ensure that payroll teams take account of the increased threshold and that any employees with an annual salary of CHF 21,510 or more receive pension insurance.

Employer Risk

Employers risk failing to remove the costs of pension fund contributions of persons who do not reach the threshold anymore if they fail to take account of the change.

Subject Matter/Name of Development Business travel and Sunday work
Summary

Certain provisions of the Swiss Labour Law Act have been amended, the key amendments concerning business travel and Sunday work. The amendment regarding business travel clarifies that, irrespective of whether the employee actually performs work, the time spent on business travel (at least on Swiss territory) is considered normal working time to the extent it exceeds the usual commuting time from the employee’s place of residence to the workplace. In terms of Sunday working, the amendment clarifies that occasional Sunday work may not exceed 6 worked Sundays per year.

Impact Date

1 January 2021

Employer Implications/Action Needed

Employers should note the new requirements and ensure that existing policies are reviewed and updated to reflect the change.

Employer Risk

Failure to comply with the amended requirements could result in financial risk for employers through employees claiming additional salary payments. The qualification as occasional Sunday work has impact on the compensation and the necessary Sunday work permit. If it transpires retrospectively that an employee worked more than 6 Sundays per year, the compensation premium for occasional Sunday work remains applicable to the first 6 Sundays worked.

Subject Matter/Name of Development Paid leave entitlement for carers
Summary

The newly-implemented Federal Law Act is intended to improve and facilitate employees caring for sick family members or those in need of care, whilst remaining in gainful employment. Implementation of the changes are on a phased basis. In the first phase, employees caring for family members in need of care have an extended entitlement to paid leave for short absences. Care credits in old-age and survivors’ insurance AHV are extended and entitlement to the intensive care supplement and the helplessness allowance of the disability insurance IV for children is adjusted. In the second phase, a 14-week paid leave entitlement for caring for seriously-ill or injured children will enter into force.

Impact Date

1 January 2021 (first phase); 1 July 2021 (second phase)

Employer Implications/Action Needed

Employers should note the new requirements and ensure that existing policies are reviewed and updated to reflect the change. Planning actions may be required in anticipation of increased absences.

Employer Risk

The changes are likely to result in increased employee absence.

Contact:

Michel Verde
Senior Associate
+41 44 204 90 90
michel.verde@eversheds-sutherland.ch

UK

Subject Matter/Name of Development

Brexit

Summary

The UK-EU Trade and Cooperation Agreement seeks to maintain the current level playing field on workers’ rights. If that standard is undermined by the UK, affecting trade and investment, the EU may (subject to conditions) be able to apply retaliatory measures.

Free movement of people has now ended and there is a new points-based immigration system for all migration to the UK (except for Irish nationals). Having a sponsor licence will be essential for organisations who recruit both from outside of the EU and from within it. EU nationals resident in the UK must have applied on/before 31 December 2020 to the EU Settlement Scheme (EUSS) for settled status (or for pre-settled status before the end of June 2021), if they wish to continue working in the UK after that date.

Impact Date

31 December 2020 onwards

Employer Implications/Action Needed

In the short-term, Brexit is unlikely to result in any significant impact on employment laws. In the longer-term, there may be a slow divergence in case law. In addition, if the EU moves to further extend or strengthen EU employment standards, the UK is likely to face pressure to keep pace and may face retaliatory measures if it fails to do so. The more immediate impact for employers will be on immigration. Employers should review their people strategy in light of the new immigration environment. This should include ensuring that they have a sponsor licence, supporting any pre-existing EU national workers with EUSS applications and reviewing and amending processes and systems for frontier workers or frequent travellers.

Employer Risk

Potential issues with recruiting and retaining workers.

Links

Brexit Hub

Beyond Brexit: employment rights and the UK-EU Trade Agreement

The new points-based immigration system briefing

EU nationals working in the UK briefing

Subject Matter/Name of Development Employment Bill
Summary

The awaited Employment Bill is expected to provide the right to: request a more predictable contract; one week’s unpaid carers’ leave; extended maternity protection on redundancy; protection of workers’ tips; neonatal leave and pay; and to pave the way for the creation of a single enforcement body. A right to flexible working as a default is also expected (with employers potentially finding this harder to refuse in the aftermath of the pandemic).

Impact Date

Implementation dates are currently unknown (although indications are that neonatal leave will be April 2023)

Employer Implications/Action Needed

The introduction of a single-enforcement body could prove significant in relation to future claims.

Employers reliant on casual workers should anticipate a new right to request a more predicable contract. All employers should assess the potential impact of the new leave provisions and changes that will make flexible working the default position.

Employer Risk

Failure to take account of the changes once implemented could result in grievances and potential litigation.

Links

What next for employment law briefing

Subject Matter/Name of Development

IR35

Summary

Responsibility for determining the tax status of workers who supply their personal services via an intermediary, such as a personal service company, is transferring to many private sector end user organisations from 6 April 2021 (under the extension of tax rule IR35).

Impact Date

6 April 2021

Employer Implications/Action Needed

Employers should take steps now to consider the makeup of workforces and address business needs to prepare for the introduction of the new requirements and minimise potential disruption to supply chains. Steps to prepare should include a review of employment models and contractual terms and training staff to understand the practical implications of the new regime.

Employer Risk

Failure to comply with the new requirements could result in liability for any underpaid employment taxes and penalties.

Link

IR35 guidance materials

Subject Matter/Name of Development

Gender and ethnicity pay reporting

Summary

Gender pay reporting obligations were temporarily suspended during 2020 and will restart for the 2020/21 reporting year. In addition to the existing gender pay reporting requirements, the UK government has proposed to introduce ethnicity pay reporting. A consultation in relation to that proposal closed in January 2019, with the outcome yet to be released. The Commission on Race and Ethnic Disparities is due to report during 2021, which is anticipated to also include proposals on ethnicity pay reporting.

Impact Date

Currently unknown

Employer Implications/Action Needed

Employers should ensure that gender pay gap reports are prepared for the 2020/2021 reporting year and review the effectiveness of diversity and inclusion initiatives. Further, prepare for potential ethnicity pay gap reporting by auditing current arrangements. Some companies in the UK have already started voluntary ethnicity pay gap reporting.

Employer Risk

Failure to ensure effective diversity and inclusion within a workplace could result in grievances and potential litigation.

Links

Bridge the gap guide

Ethnicity pay reporting briefing

Subject Matter/Name of Development

Government consultations

Summary

A number of government consultations are currently in progress or ended and awaiting outcomes, that will potentially result in employment law changes. Those consultations include the areas of sexual harassment, employment status, non-disclosure agreements, support for survivors of domestic abuse, and exclusivity clauses and restrictive covenants.

Impact Date

Currently unknown

Employer Implications/Action Needed

Employers should continue to monitor for developments. Pending any changes, employers should also review contracts and policies to identify where changes may need to be made and audit practices to assess any areas that may be vulnerable to challenge.

Employer Risk

N/A.

Links

Government consultation on non-compete and exclusivity clauses briefing

Government consultation on sexual harassment briefing

Government consultation on non-disclosure agreements briefing

NB: This update covers England, Wales and Scotland. It does not cover developments that apply only in Northern Ireland

Contact:

Diane Gilhooley
Partner
+44 161 831 8151
dianegilhooley@eversheds-sutherland.com

Middle East Global Update Banner

UAE

Subject Matter/Name of Development

Easing of sanctions between UAE and Qatar

Summary

2017, the UAE and fellow GCC countries Saudi Arabia and Bahrain, along with Egypt, severed diplomatic and trade ties with Qatar due to political reasons. The Al Ula Statement has since been signed by all participants, including Qatar. during the 41st GCC summit, leading to the easing of sanctions between the countries involved. The aim of the Al Ula Statement is to restore joint action and reinforce unity in the region. As a result, the UAE has reopened air, land and sea borders with Qatar from 9 January 2021.

Impact Date

9 January 2021

Employer Implications/Action Needed

Although this development is still relatively new with limited information publicly available in terms of the impact this may have on employers, further developments and easing of more restrictions are anticipated which would generate more freedom of movement between the two countries. For example, movement of employees, export/ import, entity presence in UAE and Qatar.

Employer Risk

Due to the developing nature of this situation, we would recommend careful consideration and review by companies in relation to any action taken linked to Qatar at this stage. This is to ensure any step taken is compliant with the current rules and regulations.

Subject Matter/Name of Development The launch of a ‘Freelance License’ in Abu Dhabi
Summary

The Abu Dhabi Department of Economic Development launched the Freelance License, which allows freelancers to conduct business in Abu Dhabi. Previously, foreigners had to be employed by a company to be able to work in Abu Dhabi. The license also allows individuals to work without the need for a local service agent or Emirati citizen as a partner.

Impact Date

15 November 2020

Employer Implications/Action Needed

Abu Dhabi-based companies now have the option to work with a Freelance License holder without the need to employ/ sponsor the individual. The Freelance License, which is specific to the emirate of Abu Dhabi, is aimed at working professionals, allowing them to work from home or any other location. Companies wishing to utilise freelancers should consider whether the license requirements are likely to be met in the circumstances, which include the applicant proving a relevant skillset. Applications can be submitted online through registering with the Abu Dhabi Business Centre.

Employer Risk

Companies face risk of acting unlawfully if they engage freelancers without a valid Freelance License. To mitigate that risk, companies should obtain proof of the valid License, which is industry/role specific (there are over 40 categories of business activities). Further, agree in writing the terms of the arrangement.

Link

www.adbc.gov.ae

Contact:

Geraldine Ahern
Partner
+9712 494 3632
geraldineahern@eversheds-sutherland.com

North America Global Update Banner

USA

Subject Matter/Name of Development

COVID-19 – reporting obligations

Summary

The U.S. Occupational Safety and Health Administration (OSHA) has released updated FAQs addressing when an employer must report employee hospitalizations in light of COVID-19, seeking to address recent confusion on the issue. OSHA clarified its position in a 30 September 2020 update, stating that employers are only required to report in-patient hospitalizations to OSHA if the hospitalization "occurs within 24 hours of the work-related incident".

Impact Date

Ongoing

Employer Implications/Action Needed

An employer has to report employee hospitalization due to COVID-19 within 24 hours of the hospitalization, but only if (1) there is an in-patient hospitalization, and (2) the employer knows that the employee contracted COVID-19 at work. Employers must also check with state and local health and safety agencies for compliance directives.

Employer Risk

Failure to report can result in penalties.

Subject Matter/Name of Development Independent contractor classification
Summary

The Department of Labor (DOL) has proposed a new employer-friendly rule to address independent contractor classification. The new proposed rule looks to the "economic reality" of each workplace relationship by evaluating five factors to determine whether the worker is economically dependent on the "employer". Importantly, the rule places focus on two "core factors": 1) the extent of control exercised over key aspects of the work; and 2) and the opportunity for profit or loss.

Impact Date

Currently under a 30-day comment period

Employer Implications/Action Needed

No immediate action is required. The proposed rule was delivered with some urgency, but may be challenged following change in the administration, which may choose to pursue a more stringent test.

Employer Risk

While the test does not pose additional burdens on the employer, misclassification can generally result in significant penalties and back-pays.

Subject Matter/Name of Development

Pay reporting (California)

Summary

Recent California legislation requires that private California employers with 100 or more employees must annually report to the State detailed pay data categorized by gender, race, and ethnicity. The report must be filed on 31 March 2021 and every 31 March thereafter. Employers with more than one establishment must submit a report for each establishment.

Impact Date

31 March 2021 and every 31 March thereafter

Employer Implications/Action Needed

Employers must review their systems to ensure that such a report can be created with some degree of efficiency. Additionally, given that the goal of the report is to uncover any wage disparities, we recommend a review of internal audit systems under attorney-client privilege to ensure that there are no hidden disparities that cannot be defended by legitimate business rationale. Further, while the current law only impacts California employers, employers should look out for similar laws in other states.

Employer Risk

If the employer fails to file the report, the Department of Fair Employment and Housing (DFEH) may recover costs associated with seeking the compliance. Further, the employer may be subject to investigations to ensure that the failure to file is not intended to cloak any unlawful pay practices.

Subject Matter/Name of Development

5th Circuit establishes new conditional certification standard for FLSA actions (case law)

Summary

In Swales v. KLLM Transport Services, LLC, the U.S. Court of Appeals for the 5th Circuit established a new standard for determining whether a case should proceed as a collective action. The court rejected what has become the widely-used two-stage process for certification of a collective action. The court stated courts should consider merits-based evidence before notice of a collective action is sent to putative plaintiffs.

Impact Date

12 January 2021

Employer Implications/Action Needed

The 5th Circuit’s new standard is likely to result in a more detailed review of FLSA collective actions by district courts in the 5th Circuit and may reduce the number or scope of collective actions.

Employer Risk

N/A.

Subject Matter/Name of Development

Telemedicine visits under the FMLA

Summary

The DOL issued guidance, stating that a telemedicine visit with a health care provider can be used to support FMLA leave. In accordance with the FMLA, one way for an employee to prove they have a serious health condition is to attend an in-person visit with a healthcare provider within seven days of the first day of incapacity. However, the COVID-19 pandemic has affected in-person visits. In its recent guidance, the DOL confirmed that a telemedicine visit is considered an in-person visit for purpose of FMLA leave so long as the visit is: (1) an examination, evaluation, or treatment by a health care provider; (2) permitted and accepted by State licensing authorities; and (3) performed by video conference.

Impact Date

29 December 2020

Employer Implications/Action Needed

Employers will have to continue to consider telemedicine visits in determining if an employee qualifies for FMLA leave.

Employer Risk

Employers can face liability for FMLA violations.

Contact:

Scott McLaughlin
Partner
+1.713.470.6155
scottmclaughlin@eversheds-sutherland.com

Previous update

February 2021