Employment Law Alert International – May 2022

Belgium

• Labour deal. The federal government has agreed on a Labour Deal which contains measures providing more flexibility in the labour market aimed at ensuring an 80% workforce participation rate by 2030. The labour deal is based on four pillars which include: more flexibility at work; stimulating individual training and monitoring innovation; facilitating changing jobs, updating the labour market to reflect digital developments, and other diversity monitoring. Further information about the agreed labour deal is here.
• Work-life balance. A first draft bill has been announced aimed at ensuring a better work-life balance for employees. The main principles concern flexible working arrangements with regard to working schedules and working hours, a new type of care leave, measures to avoid abusive and unjustified terminations of fixed or temporary workers following a leave request (eg pregnancy leave, parental leave, etc.) and the implementation of sanctions when birth leave is not respected.
• Inflation and impact on salaries. The inflation rate is currently at approximately 8% and this will have an impact on the mandatory indexation of salaries as the indexation rate is determined on the evolution of consumption price index. Therefore, for many companies (determined by a sector-level CBA), current estimations indicate a mandatory salary increase of more than 8% on 1 January 2023.
• Measures against discrimination in the labour market. As part of the fight against recruitment discrimination, the Chamber of Representatives approved a bill amending the Social Penal Code which entitles social inspectors to make mystery calls or conduct practice tests in order to detect possible discrimination during job applications. From immediate effect, a social inspector can make a mystery call as soon as there has been, ie: (1) a complaint or a notification; or (2) an objective indication of discrimination; or (3) discrimination through data mining and data matching (for example: data showing a low ratio of ethnic minorities are employed). Apart from administrative penalties, companies may also face discrimination claims by anyone who feels discriminated against although most claims following mystery calls may come from unsuccessful candidates. A labour tribunal can award the victim a lump sum of 6 months’ salary as compensation. There is also an alternative claim for moral damages.

England

• Open justice. Two recent decisions in relation to the redaction and anonymisation of documents and the provision of documents to journalists after a hearing have found in favour of open justice. In Guardian News and Media Ltd v Dimitri Rozanov & ors) the EAT ruled that it was in the interests of open justice for Guardian News and Media Ltd to have more and ongoing access to copies of skeleton arguments, witness statements and documents referred to in a Tribunal judgement, with Judge Tayler stating that "The press have an important role in reporting the judgments of courts and tribunals. It is in the public interest that they have the necessary information to be able to do so fairly and accurately.” In Frewer v Google UK Ltd & Ors) the EAT said it was an error of law to make the order to redact Google’s clients without considering the competing rights of Article 6 (right to a fair and public hearing) and Article 10 (right to freedom of expression) on the one hand and any issues of commercial confidentiality on the other. Similarly, the anonymisation order in relation to commercially sensitive information had been granted without carrying out the necessary structured analysis and to identify the appropriate rules or principles that applied.)
• Guidance on taking evidence from witnesses located abroad. On 27 April 2022 the Presidents of the Employment Tribunals in England and Wales and Scotland issued Presidential Guidance on taking oral evidence by video or telephone from witnesses located abroad. Following the decision in Agbabiaka (Evidence from Abroad, Nare Guidance) 2021 UKUT 286 (Immigration and Asylum Chamber), the guidance states that where an individual intends to give evidence from a foreign state, enquiries must be made to ascertain whether there is any objection from that state. The Foreign, Commonwealth and Development Office has established the ToE Unit which will be responsible for establishing the stance of different overseas governments to oral evidence being given from their territory. Parties potentially seeking to rely on oral evidence given abroad should inform the Tribunal as soon as this becomes apparent (but need not inform the other party) so that HMCTS can arrange for the ToE unit to make enquiries of the relevant state. It is noted that this may take months. It is hoped that in time there will be a maintained list of countries who have permitted the giving of oral evidence.
• Claimant’s perception not determinative for harassment finding. The EAT has held that the Claimant’s perception is just one of the matters for the Tribunal to take into account when considering if conduct amounts to harassment. The Claimant, who worked as a security guard at Heathrow Airport, claimed that he had been harassed by a ‘test object’ included in a security check with the words "Allahu Akbar" written in Arabic. The Claimant who is Muslim, claimed that the incident amounted to harassment on the grounds of his religion. The Tribunal found that it was not reasonable for the Claimant to perceive the conduct as having an effect falling within s26(1)(b) Equality Act 2010, given recent incidents in which the phrase had been used by terrorists and that the ‘test object’ was not designed to associate Islam with terrorism. This case serves as a useful reminder of the objective and subjective elements of section 26(4) of the Equality Act 2010. (Ali v Heathrow Express and Redline Assured Security Ltd)
• Annual D&I disclosure requirements for listed companies. On 20 April 2022 the FCA published its final rules requiring the disclosure of data in relation to diversity on listed company boards and executive committees (PS22/3). Companies must disclose annually whether they meet diversity targets on a ‘comply or explain’ basis. The targets are: (i) at least 40% of the board are women; (ii) at least one senior board position is a woman; and (iii) at least one board member is from a minority ethnic background. Companies to be given flexibility to determine how to report on those self-identifying as women.
  Reporting should start to appear in annual financial reports published early 2023. For a more detailed look at the FCA’s final rules see our Insight here.

Read our Employment Law Alert affecting employers in the UK over recent months.

France

• Gender equality. A reminder from our alert last year that companies with 50 or more employees must publish and transmitted the results of their equality index (out of 100 points) annually by 1 March. This deadline has been extended to 1 September for 2022 only. The decree dated 25 February 2022 has also clarified the publication obligations, including outlining the new thresholds for progress targets, stipulating where companies must adopt corrective measures, clarifying in what forums the targets must be published and the information that must be made available.

  In addition to this, another decree from 26 April 2022 has further specified the procedures for calculating and publishing the gaps in representation between men and women among senior managers and management bodies, how to publish the progress targets and corrective measures on the website, and the obligation to transmit these gaps, objectives, measures and publication to the services of the Minister for Labour (online declaration) and to the CSE.

  Further detail is available here on why 2022 is the pivotal year for the Gender Equality Index and what has changed.

• Forfait jours scheme. A judgment from the Supreme Court on 2 February 2022 established that an agreement on working hours in days over the year (forfait jours) does not give an employee the right to freely determine their working hours independently of any constraint linked to the organisation of work by the employer in the exercise of their power of direction. As a result, the company could impose on the employee half-days or days of presence depending on the constraints linked to the company’s activity. Within those half-days / days of presence imposed by the employer, the employee remained free to organise themselves as they saw fit. Indeed, it is important for the employee on a forfait jours to be autonomous in the organisation of their work.

Germany

• Involvement of a confidante in occupational integration management. Due to the German Strengthen Participation Act, the law has been changed now allowing an employee to bring a confidante to an occupational integration management meeting. The employee should inform the employer if they wish to bring a confidante and employers are well advised to inform employees of this option.
• Requirement of fair negotiation in case of a separation agreement. The Federal Labour Court has ruled that it is possible for separation agreements to be invalid due to violation of the fair negotiation requirement. However, whether this is the case must be decided on the basis of the overall circumstances of the negotiation situation in each individual case. According to the recent decision, an employee´s freedom of choice was not violated by the employer only accepting an immediately countersigned separation agreement.
• Employment status. Changes came into force on 1 April 2022 clarifying procedure and providing legal certainty regarding employment status under social insurance law. We have outlined the revised law and the various status determination procedures here.
• Overtime claims. In May 2022, the Federal Labour Court has now ruled that employees remain obliged to prove that they worked overtime. Previously, the ECJ in 2019 had ruled that employers must establish a reliable system for recording working time, making it unclear in Germany whether employees are entitled to overtime compensation if such recording of working time did not take place. Further, a previous decision of one labour court stated that the burden of proof was reversed and the employer had to prove that the employee had not worked overtime. This recent Federal Labour Court ruling has now clarified that an employer is not obliged to pay overtime without the employee providing proof of overtime worked.

Italy

• Gender equality. Further to our update in the February Alert, from 1 January 2022 this year companies with more than 50 employees must submit a report on the ratio of male/female staff (including analysis of related remuneration) every two years via the Ministry of Labour portal and also send to the company union representatives. The new inter-ministerial decree specifies that the report must be submitted by 30 September 2022 (for the period 2021-2022 only) and for subsequent two-year periods, reports must be submitted by 30 April of the year following the end of each two-year period. The decree also outlines the specific data to be reported. For further information on what is required please contact our team in Milan.
• Paternity leave. From 1 January this year, new fathers must now take 10 days’ fully paid paternity leave within five months from their child’s birth.
• Clawback clauses: Historically, enforceability of clawback clauses has been a grey area and often challenged legally. However, recent court judgments have confirmed enforceability in cases of misconduct stating that repayment is allowed for the net amount, not gross (ie tax paid by employer is not recoverable). However, case law does not cover early leaving (in these circumstances clawback clauses may hide invalid non-compete restrictions).

Netherlands

• Paid parental leave. From August 2022, both parents will be entitled to nine weeks of paid parental leave in their child’s first year of life. The introduction of paid leave aims to encourage both parents to take parental leave. The benefit amounts to 70% of the daily wage and is capped at 70% of the maximum daily wage. Employers should be aware that upon receiving a request for paid parental leave, it will be up to the employer to submit the application to the UWV (with all the administrative burdens involved). It will also be (even) more difficult for employers to reject a request for parental leave.

• EU Directive on Transparent and Predictable Working Conditions. From 1 August 2022, the Act Implementing the EU Directive on Transparent and Predictable Working Conditions will come into effect, which introduces:

1. the obligation for an employer to pay for an employee’s education costs (if the education is required by law or collective labour agreement), study time will now also count as working time;

2. a ban on ancillary activities clauses, unless an employer can justify the use of such a clause in the employment agreement on objective grounds;

3. the possibility for employees to request more predictable and secure working conditions after 26 weeks of employment (an employer is not obliged to comply with the request but must respond in writing);

4. expansion of an employer’s duty to inform the employee in writing or electronically of their working conditions with ie the place of work, working hours, probationary period and variable remuneration;

5. a distinction between predictable and unpredictable work patterns and the corresponding information to be provided to employees (for example on the timing of an employer’s request to perform work and defining the days and hours on which the employee is obliged to work); and

6. the employer's duty to inform an employee being seconded to another EU Member State prior to their secondment about their remuneration entitlement (including any allowances and arrangements) under the host Member State’s law and to provide a link to the relevant Member State’s website in this respect.

The aim of the Directive is to improve employment conditions by promoting more transparent and predictable employment while at the same time maintaining labour market flexibility.

Please contact our Netherlands team for more detailed information on the new Act.

PRC

• Paternity Leave for Male Employees: Male employees can now apply for paternity leave in many locations, ie: in Beijing paternity leave is 15 days. On 7 March 2022, the Beijing Haidian People’s Court released judgments which act as a reminder for fathers to protect their paternity leave rights. These three cases regarding paternity leave for male employees established that:

  • Male paternity leave is a form of maternity leave and should not be counted as annual leave. The employer is not allowed to deduct paternity leave from annual leave.
  • The employer cannot terminate employment contracts due to paternity leave or reduce the salary of the employee who is on paternity leave.
  • Employees cannot claim compensation for untaken paternity leave.

• Second Draft Revisions of Women’s Rights and Interests Protection Law: Further to our update in the February Alert, the NPC Standing Committee (NPCSC) is soliciting public comments on the second draft of revisions to the Law on the Protection of Women’s Rights and Interests through to 19 May 2022. Compared with the first draft, the second draft revisions provide, among other changes, the following:

  • Preventing Human Trafficking: The creation of an obligation to report suspected trafficking to police for various public-facing agencies, including marriage registrars. Women federations are also to play a more active role in collaborating with the police. A newly added article 28 also imposes a greater obligation for hotels to monitor and report any potentially illegal conduct from guests that is harmful to the protection of women’s rights. Also listed as prohibited treatment towards girls in article 48, the word “sale“ has been changed to “transactions”.
  • School background check system: Article 26 has added a new requirement. Schools shall conduct background record checks on a wider range of crimes, including violence, trafficking, or sexual offenses when hiring staff or volunteers, social workers, etc.

Singapore

• Work passes. The Singapore Government will be overhauling Singapore’s immigration policies by increasing the minimum qualifying salaries for work passes with effect from September 2022 and will be introducing a new Complementarity Assessment Framework (COMPASS) for Employment Passes with effect from September 2023. Employment Pass applications will need to satisfy a new 40-point criteria based on a mix of individual attributes (eg salary, professional qualifications), employer-related attributes (eg diversity ratios, support for local employment) and bonus criteria (eg specialised skills, strategic economic priorities).
• Flexible working. In line with the recent abolishment of almost all pandemic-related restrictions, Singapore has introduced non-binding guidelines to encourage employers to transition to permanent flexible working arrangements. Although voluntary, the intention behind such a move is to promote better work-life harmony to ensure a more engaged and productive workforce. The civil service has indicated that it will be adopting these flexible working arrangements as the default going forward, and many large corporate MNCs and FIs have indicated they would be doing likewise.
• The implied term of mutual trust and confidence in employment contracts. Although the position regarding the existence of such an implied term was seemingly made clear by a series of recent judgments in Singapore (influenced in large part by parallel developments in English law), a recent judgment by the Appellate Division of the High Court (the second highest judicial authority in Singapore) has recently cast doubt on the existence of this implied term, with the court favouring the approach taken by the Australian courts in recent years. This area of the law remains largely in flux pending a more authoritative decision of the Court of Appeal (the apex court in Singapore). Read our analysis on this case here.

Spain

• Gender pay and equality plans. From 8 March 2022 onwards, it is now mandatory for companies with more than 50 employees to implement an equality plan. These plans must include analysis, salary audits, monitoring and evaluation, as well as the requirement to proceed with public registration. All companies must also have a remuneration register of all their staff (including management staff and senior management,) with average categorised data. Sanctions for non-compliance can range from €751 to €7,500 if considered serious, or between €7,501 and €225,018 if considered very serious.
• Remote working. Although remote working (when at least 30% of working time is remotely) is voluntary, it is compulsory to have a signed remote working agreement in place. There is minimum mandatory content required in the agreement and the agreements must be shared with the public authorities. Failure to have a signed agreement in place could result in a fine ranging from €751 to €7,500.

UAE / DIFC

• Introduction to new DFSA Whistleblowing Regime. The DFSA has introduced a new regulatory regime for whistleblowing with effect from 7 April 2022 (“Whistleblowing Regime”).
  Under the Whistleblowing Regime, any person who makes a qualified disclosure whether internally within a DFSA regulated entity, or externally to an auditor, the DFSA Authority or any law enforcement agency, will not:

  • be subject to civil or contractual liability;
  • have any contractual, civil or other remedy or right enforced against them by another person; or
  • be dismissed from their current employment or otherwise be subject to action by their employer that is reasonably likely to cause them detriment.

  A whistle-blower is also entitled to seek relief from the courts if any of the above protections afforded are violated.

  UAE based employers are advised to put in place appropriate and effective policies and procedures to facilitate the reporting and assessment of regulatory concerns. Sanctions for non-compliance are yet to be confirmed. For further information on what appropriate arrangements are required please contact our UAE team.

• Amendments to the DIFC Data Protection Law 2020. On 8 March 2022, the DIFC introduced amendments to the DIFC Data Protection Law No. 5 of 2020. A new penalty has been introduced of $75,000 for failure to comply with a direction from the Commission of Data Protection.
  Some of the amendments include, among others:

  • clarifying the judicial redress and relief available to aggrieved individuals; and
  • introducing further accountability requirements for controllers and processors where a data subject’s request for access to data is considered vexatious or repetitive.

• Amendments to the DIFC Employment Law 2019. On 8 March 2022, the DIFC introduced amendments to the law such that weekends should fall on either Friday and Saturday or Saturday and Sunday as determined by an employer and if not determined, the weekends shall be Saturday and Sunday. For private sector companies, there is flexibility and therefore no legal requirements. However, companies need to be mindful of religious observance on Fridays and employees should be entitled to a half day on Friday for this reason.