News from Luxembourg: the time clock for everyone. In many member states of the EU, including Germany, the European Court of Justice considers the current recording of working time to be insufficient. Employers are now to be required to fully document the working hours of their employees.

On May 14, 2019, the European Court of Justice (ECJ) ruled that the recording of working hours must go beyond the documentation of overtime (Case C-55/18). Employers are to be required in future to record employees' working hours systematically.

Legal situation in Germany

Section 16 (2) German Working Hours Act (ArbZG) stipulates that employers must document their employees' working hours exceeding eight hours per working day.

This is now declared insufficient by the ECJ.

Union demands detailed recording of working time

A Spanish trade union had brought an action before the Spanish National Court of Justice seeking to impose an obligation on the employer, Deutsche Bank, to fully record the daily working hours of employees in Spain. In their view, this was the only way to ensure compliance with the planned working hours. The union reiterated its statement that 53.7% of overtime hours in Spain have to date not been properly recorded. So far, the sued employer has documented only the overtime worked by employees.

The National Court of Justice in Spain referred the case to the ECJ.

Reasoned opinion of the Advocate-General: the harbingers of the decision

Already at the end of January, Advocate-General Giovanni Pitruzzella clearly came out in favor of stricter timekeeping rules in his reasoned opinion. In his view, the Charter of Fundamental Rights of the European Union imposes an obligation on companies to introduce a system for recording the actual daily working time of employees. He considers that national legislation that does not achieve this level of protection is contrary to EU law and would therefore not be applicable.

The Luxembourg judges have now shared this view. 

Protection of fundamental rights under the EU Charter

As grounds for their judgment, the Luxembourg judges referred to the Charter of Fundamental Rights and the EU Working Time Directive 2003/88/EC. This guarantees "the fundamental right of every worker to a limitation of maximum working hours and to daily and weekly rest periods". This guarantees "the fundamental right of every worker to a limitation of maximum working hours and to daily and weekly rest periods". Without the introduction of a system for recording working time, it would not be possible to check whether the permissible working hours had been exceeded.

Ramifications: more bureaucracy and the end of trust-based working hours

Due to the comparable current legal situation in Spain and Germany, the decision of the European Court of Justice will also have considerable ramifications for German labor law.

EU member states will have to compel employers to set up a timekeeping system that satisfies the Court's requirements. The member states can decide on the details of further implementation themselves. They are free to determine the appropriate form, from a national point of view, for recording the actual daily working hours. The ECJ judges also emphasize, however, that it is possible to take special circumstances into account. For example, the size of the company or the nature of the work may justify exceptions to the strict time recording guidelines.

This means that the German lawmakers are now called upon to initiate a suitable regulation. It is crucial for the employer “to set up an objective, reliable and accessible system enabling the duration of time worked each day by each worker to be measured”.

It is foreseeable that the current form of "trust-based working time" will probably have no future. It is currently unclear whether it will be possible to delegate working time documentation to employees following the introduction of a suitable implementing law. In the World of Work 4.0, such a time recording measure appears to be retrogressive. It is quite possible that the flexibility gained in the modern working world will suffer under such a system.

It is clear that employers will have to cope with additional bureaucracy in the future. Compliance with working time laws will become more relevant as a result of the ruling. The all-clear signal applies to the extent that no immediate obligation for employers to act can be derived from the ruling of the European Court of Justice. It therefore remains to be seen how quickly the German lawmakers will take action and what the exact requirements for recording working time will be.